A Global Perspective for IOR and Primary in Unconventional Tight Oil and Gas Reservoirs. Richard Baker May-13

Transcription

1 A Global Perspective for IOR and Primary in Unconventional Tight Oil and Gas Reservoirs Richard Baker May-13 1

2 Conclusions 1. There has been tremendous growth in tight oil and gas rates and reserves. 2. Despite the rapid oil rate well counts and wells drill in major plays are constant. 3. It is extremely difficult to forecast the future oil production because the classic S shaped growth curve and the Resource pyramid. 4. It is my opinion that growth in tight oil will level off Constant well counts (constant production profiles) Decreasing liquids from gas (CGR )

3 Conclusions 5. Most of these shale plays are not really shales rather they are very low permeability plays (0.01 to 0.1 md) 6. Estimates of recoverable oil in volumetric basis are too high. 7. Pay Cut offs are way too pessimistic

4 General Observations Reservoir permeability is often higher than air permeability (small fractures contributing) inflow tests and pressure transient analysis Most of the times we have more hydraulically induced fractures than we need No strong correlation between number of induced fractures and IP or reserves number of induced fractures and IP or reserves but near wellbore permeability is huge variable This may only be true for tight oil ( true shale gas???) 4

5 Presentation Flow Big picture (countries) Medium size picture (basins) Small picture (wells) Summary 5

6 Making Forecast using historical data Forecasting like this is a bit like only looking at the rudder and determining where the boat goes Wind + waves 6

7 Beware of all forecasts with developing plays/technology Most shale oil and shale gas wells have only few years production Most shale plays are developed in sweet spots first Shale plays are large areally and only portions of fields have been developed Technology advancements will impact plays U.S. Shale Gas and Shale Oil PlaysReview of Emerging Resources: July 2011 CAUTION STATEMENT 7

8 (big picture) USA AND CANADIAN OIL RATE TRENDS 8

9 USA Oil and Liquids forecast from IEA July 2011

10 Thousands of Barrels/day USA Oil + Liquids Production US EIA website U.S. Oil Production Jan Jan US Total Oil Production Crude Oil, NGPL, and Other Natural Gas Plant Liquids Year

11 Thousands of Barrels/day USA Oil + Liquids Production US EIA website U.S. Oil Production Jan Jan 2013 Oil+ liq MM bbl/d Oil+ liq. 8.5 MM bbl/d US Total Oil Production Crude Oil, NGPL, and Other Natural Gas Plant Liquids Initially liquids from gas wells Now growth from oil wells Year

12 CAN Historical Oil Production Mining bbl/day (2010) In-Situ stm bbl/day (2010) Source Geoscout

13 All wells Canada Ends in

14 Canadian Oil Production from Hz with 5 or more fractures.includes SAGD

15 (medium size picture) BASIN ANALYSIS 15

16 16 Source; Review of Emerging Resources: U.S. Shale Gas and Shale Oil Plays July 2011

17 15% Δq o = 1.6 MMbbl/d 14% 15% 7% 17

18 Summary of Liquids Production (oil + ngl) vs. Year Source; USA EIA Sum of Annual Liquid Column Labels BARNET EAGLE HAYNESVILL MARCELLUS NIOBRAR WOODFOR Row Labels BAKKEN T FORD E /SH/ A D Grand Total ,368,710 86,401 7,455, ,951,603 20,288 98,416 14,070, ,183,264 87,996 63,122 11,558 19,345, ,316,578 82,635 64,407 89, ,348 36,697, ,047,968 94, , , ,092 57,663, ,898, ,181 1,512, ,029, ,521 93,907, ,433, ,302,933 79,384 42,381,008 48,851 5,689, , ,717,003 70, ,225,971 3,732 53,450 10,744,646 1,668, ,484, ,203,131 3,961 13,815, ,971 1,157 48,936, ,993,58 Grand Total 592,989, , ,122,034 3, ,578 18,873,890 3,328, MMbbl 136 MMbbl 10 MMbbl 206/355 = 58% = 38% = 3%

19 U.S. Shale Basins 862 Tcf & 24 BBO TRR (TRR -Technically Recoverable Resources by EIA) McClure Wolfcamp 23 Significant Shale Basins in U.S. - over 55,000 producing wells Baker Hughes Incorporated. All Rights Reserved.

20 660 M bbl/d Source: Baker Hughes Baker Hughes Incorporated. All Rights Reserved.

21 520 M bbl/d Rising oil Decreasing gas Source: Baker Hughes Baker Hughes Incorporated. All Rights Reserved.

22 19 M bbl/d Decreasing oil Decreasing gas Source: Baker Hughes Baker Hughes Incorporated. All Rights Reserved. Note rapid decline in production

23 Rig Count (~drilled wells) Jan Jan Baker Hughes Incorporated. All Rights Reserved.

24 Major Shale Oil Play Data Comparison PLAY BAKKEN EAGLE FORD NIOBRARA UTICA Depth, ft 8,500 10,400 4,000-12,000 3,000 14,000 2,000 14,000 Thickness, ft Permeability, md 0.05 Middle Bakken Up to 0.13 md md md IP Rate, BOPD 200 1, ,500 +/ ,000 Bopd + 6 MMcfd Avg Lateral, ft 10,000+ 5,000 7,000 3,300 10,000 5,500 7,500 Resources, BBO 4.5 (est to 20) (est to 5.5) Niobrara and Utica very early data Resources = Technically Recoverable (TRR) Source: EIA Baker Hughes Incorporated. All Rights Reserved.

25 Definitions of Low Permeability vs. Shale Permeability Baker Hughes Incorporated. All Rights Reserved.

26 Major Shale Oil Play Data Comparison PLAY BAKKEN EAGLE FORD NIOBRARA UTICA Depth, ft 8,500 10,400 4,000-12,000 3,000 14,000 2,000 14,000 Thickness, ft Permeability, md 0.05 Middle Bakken Up to 0.13 md md md IP Rate, BOPD 200 1, ,500 +/ ,000 Bopd + 6 MMcfd Avg Lateral, ft 10,000+ 5,000 7,000 3,300 10,000 5,500 7,500 Classification of reservoir type 4.5 by absolute Resources, permeability. BBO (est From to 20) Golan (1991). Niobrara and Utica very early data (est to 5.5) Resources = Technically Recoverable (TRR) Source: Very high EIA > Baker Hughes Incorporated. All Rights Reserved. Permeability Classification Permeability (md) Very low < 0.01 Low Average High

27 Sample of Pembina Cardium Multi-Frac d Wells ~65% decline rate in first year, shallow decline after that Initial rates show large scatter but similar decline trend Total trend 81 wells

28 USA BAKKEN OIL RATE ~Arithmetic average~200bbl/d 28

29 ABCs of Reservoir and Well Dynamics: Controlling Factors Completion Fractures Near wellbore permeability Oil rates Pressure support Drive mechanism Far field permeability time First year production

30 Oil rates ABCs of Reservoir and Well Dynamics: Controlling Factors Completion Fractures Near wellbore permeability Pressure support Drive mechanism Far field permeability Decline rate is steep ~65%/yr in first year, generally caused by: Transient effects Pressure depletion Increasing gas saturation Secondary recovery will become critical to maintain a higher plateau oil rate Lack of drive energy First year production time

31 Checks and Balances Use available data in many ways: Model Building Image logs Fracture reports Shale petrophysics Mechanical properties Formation structure Well geometry Fluid characterization Model Validation Microseismic Tracer surveys Production logging Minifrac Transient tests Production rates and pressures 31

32 Finite difference numerical options Can capture most flow dynamics Need to be oriented along principle stresses Micro Seismic Data MFrac simulations a. Tartan Grid (SPE ) b. Variable Frac Conductivity (SPE ) 32 c. Affected Rock Volume Modeling (SPE ) d. Shale Engineering (SPE *)

33 Advanced Reservoir Engineering for Shales In-Place Description Shale Engineering Cash flows Shale Engineering Modeling Based on geo-mechanics Flow Physics Pressure-dependent properties Matches observed performance Interprets and implements micro-seismic Optimizes well design and field development Provides early predictions of long term production behavior 33 Based on: CSUG/SPE

34 What are the lessons learned from Fracture Diagnostics and Reservoir Simulation Permeability is controlling factor Primary waterflood In lower permeability formations natural fractures increase permeability Pay cut offs are way too high Reservoir drive energy is late stage controlling factor 34

35 With new technology HISTORIC GROWTH CURVES

36 Historic Growth Curves (organic growth) 2012 Baker 36 Hughes Incorporated. All Rights Reserved.

37 Historic Growth Curves (organic growth) Only so many good fields/infrastructure/political limitations Rapid growth Best fields being exploited Reservoir depletion Few operators + not much experience 2012 Baker 37 Hughes Incorporated. All Rights Reserved.

38 Thermal EOR Production 1000 bbls/day US Thermal EOR Production Data (mainly California) Source: Strosur (2003) till 1994, Conservation Committee of California Oil and Gas Producers till 2003, DOE report till 2008 and Mohan et al (2011). 700 Rapid growth 600 Best fields being exploited 500 Limitations on number good fields/infrasture 400 Reservoir depletion Few operators + not much experience Year

39 Historic Growth Curves (organic growth) Only so many good fields/infrastructure/political limitations Rapid growth Best fields being exploited Reservoir depletion Few operators + not much experience 2012 Baker 39 Hughes Incorporated. All Rights Reserved.

40 Note Oil rate Growth in West Texas ``s`` shaped curve in 1950 s draft for discussion purposes only 40 5/27

41 Oil Production from Saskatchewan s Horizontal Wells PTAC Report 2006 Flat plateau; decreasing costs + more poor res. quality 130 Mstb/d Growth has been achieved by using horizontal wells 5/27/2013 draft for discussion purposes only 41

42 Alberta Tar Sands 750 MSTB/d Not including Cold Lake + >150 Approximately ~900 MSTB per day Note Field Pilots, note growth oil rate 5/27/2013 draft for discussion purposes only 42

43 Monthly CO2 EOR Oil Production (1000 bbls/d) 'World' Oil Price (2004$) / # of Projects Most growth in CO 2 occurred in a low price environment US CO 2 EOR Growth (2004$) Price collapse 250 infrastructure First large field tests Year Monthly CO2 Production (1000 bbls/d) World Oil Price # of Projects J. Shaw EOR Presentation April 7, 2006 (Calgary EOR Forum) and WTRG Economics 5/27/2013 draft for discussion purposes only

44 There is always a much larger lower quality resources compared to high quality resources 5/27/ draft for discussion purposes only

45 Thousands of Barrels/day USA Oil + Liquids Production US EIA website plus RB view U.S. Oil Production Jan Jan Why constant well Count + infrastructure US Total Oil Production Crude Oil, NGPL, and Other Natural Gas Plant Liquids Year

46 Conclusions The future forecast is sensitive to; Oil price and Technology Pressure support Not in that order The future of tight oil forecast is a function of IP, decline rate and plateau oil rate of individual wells Geology Completion, well length OOIP Shale Oil Development Requires Large Number of Wells 46

47 US Tight/Shale Oil Basins An overiview Fabián Vera (FVR) Reservoir Engineer Unconventional Resources Team

48 References Kennedy, Robert. US Shale Basin Overview. Lecture given at Shale Academy. Februrary Internal document 03/07/ /07/ /07/ Baker Hughes Incorporated. All Rights Reserved.