The Next Trillion: Anticipating and Enabling Game-Changing Recoveries

Nansen G. Saleri, SPE, Manager, Reservoir Management, Saudi Aramco

Editor’s note: This is the second installment of a yearlong series designed to stimulate discussion in research and development. The Technology Tomorrow articles will be published every other month and vary in emphasis, covering topics as broad as R&D industry trends and as focused as improving reservoir recovery factors. This series is one of several actions being taken by the SPE R&D Advisory Committee to encourage R&D development and discussion. The target audience is the entire readership of JPT. We hope to create a forum that sparks discourse and ideas, including ideas that may not be in the current mainstream of thought. Comments on the articles are welcome. Please send any questions, comments, or ideas to vik.rao@halliburton.com.

By any measure of efficiency, globally reported expected ultimate recoveries (EURs) have been less than impressive. The often-quoted industry average of 35% recovery (for conventional crude oil) sets a useful benchmark for the future, and raises the question, “Can we double it for the next trillion?” As we look ahead to April 2007, the date of the first SPE R&D Conference, one might ponder several related questions: How high can the industry stretch EURs? What are the major impediments to achieving them? Do R&D programs have a role to play, or does the spontaneous technology boom in the industry coupled with free-market dynamics signal the end of organized R&D?

A quick look at global oil resources, their acknowledged uncertainties notwithstanding, calls for some perspective on this issue (Fig. 1). In 2005, global consumption had depleted only one out of seven barrels of conventional oil initially in place (and a fraction of nonconventional), a point perhaps overlooked by peak-oil advocates (Deffeyes, 2005; Tertzakian, 2006). A 10% incremental recovery translates to about 1.4 trillion bbl of recoverable resources, roughly an additional 50-year supply of global crude consumption at current rates. The gains in gas reserves could be equally rewarding.

Fig. 1—The author's estimate of global oil resources based on various sources.

The point is not so much to argue for the veracity or the feasibility of these figures. Instead, the intent is to highlight vast possibilities in the context of twin questions: How can R&D shape the energy future, and how should the desired future outlook govern present-day R&D? Intent matters! The industry has no choice but to articulate its own anticipations for the future regarding trillions of barrels of recoverable resources. The recovery standards of the past century certainly cannot be the basis going forward.

Among countless opportunities for future direction, my personal top four challenges for the R&D community are relatively simple and aim at raising EURs significantly.

Exploring and understanding the pore. A much deeper understanding of the physical and chemical processes at the pore-throat scale would lead to step-change improvements in recovery efficiency, akin to stem-cell research in fighting the biogenetic roots of medical ills. It could also create a new generation of designer wettability-altering agents (chemical and beyond chemical, based on pore-throat research).
Creating imbedded smartness in wells, including the development of next-generation maximum-reservoir-contact wells (Saleri, 2003, 2004) with supersmart flow-control features imbedded into the casing design (smart pipes?).
Speeding well construction. Transforming oil and gas resources to reserves depends critically on favorable economics and, hence, on the future capacity to drill wells much faster than in the past.
Developing electrical submersible pumps with extreme ruggedness, versatility, and smartness and fully integrated with next-generation intelligent-well design. This would create boundless opportunities for both conventional and unconventional reserves.

The game-changing advances of the past decade in drilling, completions, and diagnostics technologies are fuelling expectations for bolder and higher EURs. The industry is witnessing the resurgent penetration of information technology into upstream operations. The intelligent field and the geosteering phenomenon are nothing but the spread of the computer chip—ever present in our modern lives in mobile phones and smart products—into the E&P operational theater. The result is a growing level of intelligence and sophistication about the subsurface with predictably positive consequences (Fig. 2).

Fig. 2—Saudi Aramco’s upstream-technology deployment.

Maximizing constituent factors that make up EUR efficiency (i.e., EA, EV, and ED), remains arguably the pre-eminent challenge for upstream R&D. EA and EV values approaching unity (i.e., 95% plus) are well within the industry’s reach thanks to unfolding advances in geosteering, complex-well architecture, and intelligent flow-control devices (Saleri, 2005). R&D’s mission in this domain is simply to accelerate and enhance what already has been initiated. ED, by contrast, offers a wider, more elusive target range (60–100% for conventional reservoirs), depending on fluid/rock interactions and the underlying physical and chemical processes. How can R&D push ED to a higher plateau? Can a molecular perspective offer the most promising path forward?

Peak-oil enthusiasts embrace the notion, at times unknowingly, that recovery efficiencies are, by and large, technology insensitive—the next trillion will mirror the last! Can we accept the premise that the 21st century’s innovations will be inconsequential in terms of recovery efficiencies? In my view, for EURs of 75% and higher to be more than tokens of vision statements, the industry must embrace a bolder R&D perspective. More ambitious than the past, less ambiguous in its EUR mission, and emboldened with the intensity and financial muscle similar to that of the Apollo space project. Welcome to the San Antonio R&D Conference, April 2007.

Legend

EA = Areal Conformance Efficiency (fraction).
EV = Vertical Conformance Efficiency (fraction).
ED = Displacement Efficiency (fraction).

References

British Petroleum. 2004. BP Statistical Review of World Energy. London.

Deffeyes, K.S. 2005. Beyond Oil: The View from Hubbert’s Peak. Hill and Wang Publishers.
Intl. Energy Agency. 2004. World Energy Outlook.

Saleri, N.G. 2005. Diagnostics and Tenets in Modern Reservoir Management, Proc. of the Eighth Intl. Forum on Reservoir Simulation, Stresa, Italy, June.

Saleri, N.G., et al. 2004. Shaybah-220: A Maximum Reservoir Contact Well and Its Implications for Developing Tight Facies Reservoirs, SPEREE (August 2004) 316.

Saleri, N.G., Salamy, S.P., and Otaibi, S.S. 2003. The Expanding Role of the Drill Bit in Shaping the Subsurface. JPT 53.

Tertzakian, P. 2006. A Thousand Barrels a Second. New York: McGraw-Hill.

U.S. Geological Survey. 2000. World Petroleum Assessment 2000. Washington, D.C.

Nansen G. Saleri is Manager of Reservoir Management for Saudi Aramco, overseeing reservoir management and strategic planning activities for the company’s hydrocarbon reserves. He has held various positions with the company, including Chairman of the Gas Development Strategy Task Force; Co-Leader, Drilling Re-Engineering Project; Member, E&P Technology Steering Committee; and spearheaded the company’s efforts in maximum reservoir contact and next-generation wells. Saleri is a member of the Advisory Board of Petroleum Engineering at the U. of Houston, is the author of numerous technical papers, and is a frequent speaker at oil and gas industry conferences. Saleri earned MS and PhD degrees in chemical engineering from the U. of Virginia. He was an SPE Distinguished Lecturer during 1991–92, a keynote speaker at the Fifth and Sixth SPE International Forums on Reservoir Simulation, and Cochairperson of the 1997 SPE European Forum.