Experiences, Successes and Challenges in Sustaining Long-Term Production at the Tiwi Geothermal Field

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Experiences, Successes and Challenges in Sustaining Long-Term Production at the Tiwi Geothermal Field Anthony (Tony) Menzies Chevron Geothermal Services Company Chevron 2005 IEA GIA/EDC Joint Seminar September 21, 2013

Drilling of Nag-1 (1972) Chevron 2005 Credit: Bernie Tolentino 2

Presentation Outline Introduction Field Location and Regional Setting Summary Fact Sheets Power Plants and Production Resource Description Challenges and Responses Meteoric Recharge (MR) Matalibong Steam Zone and Rising Liquid Levels Concluding Remarks Chevron 2005 3

Introduction Development of the Tiwi geothermal field was notable for the installation of 330MW over three years (1979 to 1982) This was and still is one of the most aggressive development schedules seen in the geothermal industry The aggressive development was a consequence of the situation in the Philippines at the time, with a 95% dependence on imported oil, three fold increases in oil prices and surging demand for electricity There was obviously risk associated with the speed of this development and also that of Mak-Ban (330MW; 1979 1984), with both fields reacting quite differently to the imposed level of extraction This presentation will review two of the major challenges that have occurred in Tiwi and how they were or are being managed to reach a successful outcome Chevron 2005 4

Location and Geologic Setting Tiwi is located in the Bicol Region of Southern Luzon, 350 km SE of Manila on the northeast flank of Mt. Malinao Mt. Malinao is part of a chain of andesitic, composite volcanoes associated with SW subduction of the Pacific Plate, which include Mt. Mayon and Mt. Bulusan which continue to be active Chevron 2005

Topographical Map and Production Sectors MATALIBONG NAG PARK BARIIS KAPIPIHAN 5&6 1&2 3&4 5&6 1&2 3&4 Chevron 2005 6

Power Plants and Production Power Plants: Initial installed capacity: 330 MW Units 1 and 2 (55 MW each) - 1979 Units 3 and 4 (55 MW each) - 1980 Units 5 and 6 (55 MW each) - 1982 Partial Re-hab (re-rated to 234 MW) Units 1 and 2: 60.0 MW each Units 5 and 6: 57.0 MW each Unit 3: standby in 2005 Unit 4: decommissioned in 2001 Overall Generation 49.04 TWh gross generation as of Aug 2013 Average 161 MWe gross (1979 2013) Production Facilities: 81 equivalent km of pipeline 10 separator vessels and 6 scrubbers 40 production / 20 injection wells Chevron 2005 7

Resource Description Production Area: 18 km 2 Initially over-pressured and artesian with small shallow steam zone in outflow Max. resource temperature: 340ºC Reservoir fluids generally benign 5,000ppm Cl; avg 2.5 wt-% NCG Reservoir changes due to production Formation of steam caps in Naglagbong and Matalibong Influx of meteoric water (different depths) Influx of peripheral acid fluids Wide variation in well discharge characteristics Discharge enthalpy: from liquid water (1,050 kj/kg) to steam (with up to 30ºC superheat) Steam production: from 2.5 to 40+ kg/s Present resource challenges Rising liquid levels below steam zone Maintaining injection capacity Chevron 2005 8

Challenges and Responses Challenge Signature Response Meteoric water influx in Nag resulting in Calcite scaling and thermal decline Injection of waste brine / injection breakthrough Well / Pipeline Scaling Acid-sulfate / Corrosive Fluids Steam Cap Dryout Declining Cl, excess stm, NCG, increasing Tritium Increasing Cl, Si and lower excess stm, NCG Well production/injection declines, blockages Declining ph, increasing sulfate, Mg Superheat, excess Cl, Fe in steam condensate Moved production further west Drilled more distal injectors SDO and acidization, reconfiguration of well tie-ins, hot brine injection Recompleted wells or changed targets Downhole chemical mitigation Deeper casing in new wells Pilot infield injection, Brine scrubbing (MatRidge Upgrade) Steam wells turn wet and lose productivity Step change in enthalpy and productivity caused by rising liquid level Divert injection from Matridge area to the south east Chevron 2005 9

Chevron 2005 Meteoric Recharge (MR)

Impact of MR on Production Tiwi started commercial production in 1979 1982 with the available steam supply from the Naglagbong sector being more than sufficient to fully load all units (330MW) Initial production caused high pressure drawdown and formation of an extensive steam zone, particularly in shallow outflow region Production discharge enthalpies increased, with most wells turning to all steam Shut-in wellhead pressures increased as the steam zone expanded downward Increased shallow steam formation and associated heat flow resulted in a number of hydrothermal eruptions from 1977 to 1984 in the area of the hot springs Chevron 2005 11

Impact of MR on Production Steam zone formation was followed by an influx of groundwater (MR), leading to productivity declines in Naglagbong wells due to: Cooling and enthalpy decline Increased occurrence of calcite scaling Various ideas were put forward to stop the influx, including grouting and injecting seawater to initiate anhydrite scaling. These were not successful With the declining productivity of the Naglagbong wells, make-up wells were drilled progressively to the west; initially in the Kapipihan area and later in the Matalibong and Bariis areas Only one of the original Naglagbong wells is still producing Chevron 2005 12

Impact of MR on Production Loss of production in the Naglagbong area required replacement wells to be drilled in the Western sectors (Kap-Mat-Bar) Chevron 2005 13

The Attack of the Blue Blob Chevron 2005 14

Monitoring MR Movement Chloride Chevron 2005 15

Monitoring MR Movement Tritium Chevron 2005 16

Tiwi Production Area and Well Locations 2008 1&2 5&6 1978 3&4 3&4 Power Plant Units Chevron 2005 17

Matalibong Steam Zone and Rising Liquid Levels Chevron 2005 18

Chevron 2005 Tiwi Field Map Showing Present Production and Injection Areas

Matalibong Production/Injection Sector Matalibong Sector Chevron 2005

Chevron 2005 Matalibong Production/Injection Sector Important area of the field as it provides 30 40% of the total steam production, with a significant proportion from the overlying steam zone, with a number of wells producing superheated steam Steam zone production has declined since 2004 by 26MW due to a rising liquid steam interface that has flooded the deeper steam production zones in some wells Rising interface is caused by combination of increasing deep liquid zone pressures and declining steam zone pressures If the interface continues to rise, it is anticipated that a further 34MW will be lost over the next 10 years, in addition to normal decline Understanding how and why the deep liquid and overlying steam zone pressures are changing is therefore important to the long term management of the resource 21

Steam/Water Interface Changes Pressure (MPa.g) 10 8 6 4 2 Pressure @ 1,000m bsl Pressure @ 600m bsl Steam-Water Interface 600 700 800 900 1000 0 1100 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 Steam/Water Interface (m bsl) The relative change in deep liquid and shallow steam zone pressures since the mid-1990 s has resulted in a continuous rise in the steam-water interface from 945m bsl in 1995 to 700m bsl in 2009 and this has continued Downhole PT logs confirm that the rise in water level has flooded deeper production zones in some steam wells that had previously produced dry or superheated steam When the flooding occurs, the wells quickly change from producing steam (2,800+kJ/kg) to liquid (1,160kJ/kg) and productivity declines or the well dies Chevron 2005 22

Well Mat 23 Downhole Data -250 Satn T: Flowing Satn T: Shut-in 0 250 Elevation (m bsl) 500 750 1000 Production Zone Steam/Water Interface 1250 1500 Chevron 2005 1750 Flowing Press Shut-in Press 0 2 4 6 8 10 Pressure (MPa.a) Flowing Temp Shut-in Temp 150 200 250 300 Temperature (deg C) 0 10 20 30 40 SH (deg C) 23

Simple Conceptual Model and Net Voidage Concept Production from the deep liquid zone is independent of production from the overlying steam zone Net voidage in the liquid zone is defined as: Net voidage = deep injection deep production Chevron 2005

Chevron 2005 Correlation Between Deep Pressure Changes and Voidage

Observations The data indicate that the pressure increase in the deep reservoir is caused by injection to Mat-21 and 33 and this has caused the steam-liquid interface to rise and negatively affect the shallow steam wells Based on the net voidage analysis, reducing deep pressures will require >125kg/s injection flow to be diverted to another area of the field This information was used to justify the building of an injection line linking WS-7 to the SE injection system Diversion of brine through this line was recently started The liquid-steam interface also depends on pressure changes in the overlying steam zone. Hence it will be necessary to maintain negative voidage to get the interface to descend. If this occurs, it may allow previously flooded production zones to flow again Chevron 2005 26

Chevron 2005 Concluding Remarks

Resource Challenges Going Forward The historical issues are still with us and hence we need to continue to be vigilant Major resource challenges going forward continue to include: Difficulty in forecasting well and field decline; Stabilizing the Matalibong steam zone; Potential thermal degradation of deep reservoir due to continuing meteoric recharge; Managing injection Maintaining capacity Where to inject and how much? Monitoring for possible thermal breakthrough Chevron 2005

Concluding Remarks Tiwi has presented many challenges over the years for resource management and no doubt it will continue to do so in the future The meteoric influx to the Nag area during the first 3 years of operation was a huge challenge that required relocation of the entire production system and has continued to influence resource management to the present time Tiwi generation for the past 34 years has averaged 161MWe (gross) and has provided 45.76 TW.hrs (net) electricity to the Philippine national grid In 2008, Bar-11 and Kap-35 were successfully drilled and opened up additional production areas to the south and southwest of Bariis and Kapipihan that will help maintain production in the future Today we are producing 140MWe and there are plans to drill additional wells in the future to increase capacity Chevron 2005 29

The End Thank you Chevron 2005