The Lowest OPEX Producer Wins the Production Game

Transcription

1 The Lowest OPEX Producer Wins the Production Game Enercom Dallas, February 23, 2018 Jeff Saponja, CEO A Schlumberger Joint Venture Multiple Patents Pending HEAL Systems, 2018

2 Agenda 1. Horizontal Well Production Phase Challenges 2. OPEX Reduction Opportunity 3. Importance of Life of Well Slug Flow Mitigation 4. Case Studies 5. Q&A Production Plus Energy Services Inc

3 Horizontal Well Production Phase Challenges Production Plus Energy Services Inc

4 OPEX Definition (basic) Lift Selection OPEX = Lifting Cost BBL Drawdown Production Plus Energy Services Inc

5 Production Engineer s Predicaments 1. No single lift solution for life of well 2. Production rate at the end of natural flow is greater than the top end of rod pumping 3. More drawdown means less reliability of lift system Production Plus Energy Services Inc

6 Depth 3 Depth 3 Rod Pump Depth 2 Natural Flow ESP Gas Lift Rod Pump Depth 1 Depth 2 Depth 1 Gas Lift ESP Production Rate (bbl/d) Natural Flow Common Approach to Production and Lift Conventional Strategy > 300 bbl/day < 300 bbl/day 0 Time Production Plus Energy Services Inc

7 Natural Flow Phase Challenges Challenge Excessive solids Frac proppant flowback events Killing of well transitioning to lifting phase Maximization of flow period Consequence Higher OPEX Higher OPEX Higher OPEX Higher OPEX Production Plus Energy Services Inc

8 > 300 bbl/day Lift Phase Challenges Challenge Pump gas interference Pump solids damage Rate maximization Restrictive casing size Lift system selection Consequence Higher OPEX Higher OPEX Higher OPEX Higher OPEX Higher OPEX Production Plus Energy Services Inc

9 < 300 bbl/day Lift Phase Challenges Challenge Pump gas interference Pump solids damage Drawdown maximization High field backpressure Lift system selection Consequence Higher OPEX Higher OPEX Higher OPEX Higher OPEX Higher OPEX Production Plus Energy Services Inc

10 OPEX Reduction Opportunity Production Plus Energy Services Inc

11 Where is the hidden upside in production rate? Production Plus Energy Services Inc

12 The Importance of Drawdown High BHP Low BHP Production Plus Energy Services Inc

13 Producing Bottomhole Pressure Lift Type Comparison Ideally want lowest OPEX artificial lift method at the appropriate phase of the decline curve Production Plus Energy Services Inc

14 The Importance of Life of Well Slug Flow Mitigation Production Plus Energy Services Inc

15 Slug Flow is the Root Cause of Higher OPEX P P Pump not sumped Production Plus Energy Services Inc

16 Why do Horizontal Wells have Slug Flow? Slug Flow Mechanisms Production annulus gas rate Typical Pump Location Production Plus Energy Services Inc

17 Slug Flow is the Root Cause of Higher OPEX Slug Flows Cause Fluctuating gas and liquid rates OPEX Consequences Solids transport in horizontal High fluid levels and high BHP s High pump failure rates Poor pump efficiency and downhole separation Reduced run times Acceptance of gas lifting for life of well Fluctuating BHP s Frac proppant flow back Production Plus Energy Services Inc

18 Slug Flows Transport Solids Along Horizontal Solids are transported in dunes or beds along horizontal due to wave mechanics (saltation) associated with slug flow Solids dunes / beds in horizontal created by slug flow Transported solids accumulate at the heel of the horizontal well, where pumps are commonly positioned high risk of solids damage to pumps Source: Production Plus Energy Services Inc

19 Slug Flows Reduce Frac Conductivity Maximum pressure to maintain stability of proppant pack Maximum flow rate (velocity for sand transport) In example, rates were above the level of proppant pack stability Evidence that periodic high rates from interruptions and slug flows can reduce proppant conductivity Source: Schlumberger (accessed 26 July 2017). Production Plus Energy Services Inc

20 Slug Flow Mitigation with HEAL System Production Plus Energy Services Inc

21 Bottomhole Pressure Regulating Flow for Slug Flow Mitigation Bubble Flow Slug Flow Annular Transition Mist SRS is sized for: 1. Slug flow mitigation 2. Longevity and should not require re-sizing or maintenance Tubing ID Source: Purdue University Production Plus Energy Services Inc

22 Gas Lifting Drawdown Limitation Mist Flow Gas Gradient Annular Transition Flow Slug Flow Bubble Flow Gas Lifting Limitations: 1. Multiple flow regimes compounding throughout gas lifting interval means drawdown BHP s limited to psi 2. Higher OPEX 3. Less recovered reserves Mist Flow Production Plus Energy Services Inc

23 Low Cost Lift Transitioning: NF to Gas Lift to RP Natural Flow Gas Lift HEAL Slickline System is installed below gas lift system HEAL Slickline Separator Flow Through Prong installed (HEAL Slickline Separator is bypassed and isolated from annulus) Extends natural flow period as SRS lifts fluids around bend and delays the onset of liquid loading Formation Fluids Transition to gas lifting without pulling tubing Gas lift same as conventional; injecting gas down production annulus HEAL System SRS increases production drawdown over conventional gas lifting as fluids are efficiently lifted around bend section and slug flow is mitigated (Oil, Water, Gas) Separated Gas Oil / Water Rod Pump Can low cost transition to rod pump without pulling tubing With slickline retrieve Flow Through Prong; install HEAL Separator Prong RIH and land insert pump/rods into upper nipple profile Production casing is open for separated gas HEAL System protects pump from gas and solids, as well as maximizes production drawdown Solids are separated and settled in HEAL Sump INSERT PUMP Separated Solids HEAL SLICKLINE SEPARATOR c/w FLOW THROUGH PRONG HEAL SLICKLINE SEPARATOR c/w FLOW THROUGH PRONG HEAL SLICKLINE SEPARATOR c/w SEPARATOR PRONG OPTIONAL: CHOKE OPTIONAL: STANDING VALVE OPTIONAL: FRAC HIT PROTECTION SRS STRING SRS STRING SRS STRING HEAL SEAL HEAL SEAL HEAL SEAL Production Plus Energy Services Inc

24 Turner Critical Flow Rate (mcf/d) Improving ESP OPEX: Casing with Enlarged Interval 8 ½ hole size 5 ½ Casing Annular flow area past a 4.5 OD equipment is 700% greater with Production Enhancement Casing Sub, therefore it handles 700% higher gas rate at an equivalent downhole pressure ½ x 7 Swedge 7 Casing 7 Swedge KOP % Performance Enhancement 5.5" 20 ppf Casing 7" 32 ppf Casing Pressure at 4.5 OD Component (psia) Production Plus Energy Services Inc

25 Case Studies Production Plus Energy Services Inc

26 Case Study: Improve Production Performance HEAL System Installed Reference: Nagoo, A. et al Multiphase Flow Simulation of Horizontal Well Artificial Lift and Life-of-Well Case Histories. HEAL System Modeled in Pipe Production Plus Energy Services Inc Fractional Flow. Presented at URTEC, San Antonio, Texas URTEC MS.

27 Case Study: Reduce OPEX (Reliability) Viking, Canada Ran pumps deep to maximize drawdown but then multiple pump failures Ran pumps shallow for reliability but then poor drawdown, rod breaks from gas interference Pre-HEAL: 9 pump changes over 2 years costing $600k Post-HEAL: Zero pump changes in 2.5+ years Production Plus Energy Services Inc

28 Case Study: Reduce Capital Investment Cardium, Canada HEAL PSN: 1320m (1312mTVD) 0 deg inclination Surface Unit Conventional PSN: 1570m (1524mTVD) 60 deg inclination Surface Unit HEAL System allowed PSN to be raised 700 up into vertical Can now use smaller pump jack; saves $30k 800 less production tubing and rods, saves $10k Same or better drawdown Reduced pump failure frequency and system wear No need to conventionally lower pump over time Production Plus Energy Services Inc

29 Reduce OPEX: Enhance Plunger Lift with HEAL System Rod Pump Installed HEAL System Installed First commercial install: Permian Basin Wolfcamp HEAL + continuous flow plunger Proceeding as expected: Consistent plunger arrivals Production 2x from rod lift Reduced OPEX Production Plus Energy Services Inc

30 Total Fluid Rate (bbl/d) HEAL System Installed Case Study 6: High-rate Deep Rod Pumping Days After Install Pump Card Gas Lift to long stroke 8,200 ft: Inconsistent gas lift production Consistent production after transition to RP/HEAL 86% increase in total fluid rate > 85% consistent pump fillage Reduced Opex Increased top end of deep rod pumping ~600 bbl/day Production Plus Energy Services Inc

31 HEAL System Installed Case Study: Improve Production Performance Wolfcamp, Permian Basin Gas lift to Rod Pump transition, lower BHP. Wolfcamp Formation is challenged by depth, high total fluid rates, high watercuts and severe high GOR gas interference Installation in 12 Wolfcamp wells resulted in a sustained +33% increase in production Lower OPEX and total capital with rod pumping Production Plus Energy Services Inc

32 Case Study: Gas Lift to Rod Pump Transition Oklahoma Gas lifting baseline strategy. Major historic rod pumping challenges: deep, high GOR, high initial rates and decline rates Increased drawdown objective. Transitioned to rod pumping with HEAL System; installed in 9 wells Long term (>12 months) average result is +100% increase in production over previous trend, increasing drawdown from 600 psi to 120 psi Implementing larger program (100 wells), transitioning from gas lift to rod pumping with HEAL System Production Plus Energy Services Inc

33 Monthly Lease Operating Expense per BOE (USD/BOE) HEAL System Installed Case Study: Gas Lift to Rod Pump Transition Oklahoma $10 Monthly LOE/BOE Comparison for Gas Lift Conversion to Rod Pump in Oklahoma $8.17 $8 $5 $3 $2.57 $ Days After HEAL System Install Production Plus Energy Services Inc

34 300% uplift in Production on single well Capital Efficiency: ~$1,300/boe/day Payout: 1.8 months 75% uplift in production averaged on 25 wells Capital Efficiency: ~$1,900/boe/day Payout: 2.4 months Average 6month incremental Production 20,000 bbls OPEX Reduction (20%-40%) Production Plus Energy Services Inc

35 Cumulative Incremental Operating Cash Flow Thousands Cumulative Incremental Operating Cash Flow Thousands Case Study: Improve Economics Montney, Canada $400 $350 $300 $250 $200 $150 $100 $50 $0 ($50) ($100) ($150) $400 $350 $300 $250 $200 $150 $100 $50 $0 ($50) ($100) ($150) HEAL Installed at Transition or Failure Netback = $10.00/boe Netback = $15.00/boe Netback = $20.00/boe Netback = $25.00/boe Month After Install Workover Only for HEAL Install Netback = $10.00/boe Netback = $15.00/boe Netback = $20.00/boe Netback = $25.00/boe Month After Install HEAL System Cost Only HEAL Total Workover Cost New Drill HEAL System Cost Only HEAL Total Workover Cost Total Capex Incremental Daily Production Capital Efficiency $/boe/d $60, $923 $120, $1,846 $3,500,000 $4,500, $ Internal Rate of Various Netbacks $10/boe $15/boe $20/boe $25/boe 328% 535% 737% 937% 98% 218% 328% 433% New Drill 20%-75% HEAL System Cost Only HEAL Total Workover Cost Payout Period Various Netbacks $10.00/boe $15.00/boe $20.00/boe $25.00/boe New Drill Production Plus Energy Services Inc

36 Production and Lift Strategy Defined by Slug Flow Mitigation > 600 bbl/day < 600 bbl/day (increased top end of rod pumping) Production Plus Energy Services Inc

37 Thank You CONTACT DISCLAIMER This presentation is for use by the HEAL System user (User) only. User has sole responsibility for the use of the HEAL System and any field operations and installation activities in relation thereto and neither HEAL Systems nor any of its affiliates or representatives shall have any liability to User under any circumstances in relation to any field operations of or installation activities conducted by User. HEAL Systems does not makes any representations or warranties express, implied, statutory or otherwise as to the HEAL System (including as to the merchantability or fitness for a particular purpose thereof) or as to the procedures contained in this guide. No certainty of results is assured by HEAL Systems and HEAL Systems makes no warranty concerning the accuracy or completeness of any data, the effectiveness of material used, recommendations given, or results of these procedures or technology. User's use of the HEAL System is subject to the terms and conditions of its master sales agreement with HEAL Systems TRADEMARK HEAL System is a trademark of HEAL Systems Production Plus Energy Services Inc