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Well-Integrity Management and Profitability

Gunnar Andersen, President, TecWel A/S

Well-integrity management (WIM) is an important part of health, safety, and environment and quality-assurance programs in the petroleum industry. Still, there is room for improvement; it is a matter of protecting an investment. Hardly any other industry is building such “expensive factories” as the petroleum industry when it drills and completes a well. Then again, hardly any other industry is putting so few resources into maintaining and running these “factories,” or, in other words, not making the maximum profit. This is not because of a lack of brains, capacity, or financial muscle.

Ranking a project and justifying its value should be done by calculating its net present value (NPV). Every company should perform NPV calculations before approving or disapproving a well-intervention project. The NPV model accounts for the long-term prospect of a project and is used to model the economy of the well’s remaining life. The model does not necessarily come up with exact values of the project but will rank the project among other projects and make its value visible.

WIM has been described as an “unimpaired condition based on a standard,” indicating that it is something forced on operators. But a more easily understood definition is “prevention of uncontrolled flow of fluids.” When things go wrong, it can have catastrophic consequences, such as loss of lives and equipment or contamination of groundwater reservoirs. It is fair to say that WIM is focused on the drilling and completion phase of a well, and a well’s life cycle has room for improvement all the way from the design through the operational phase to the final abandonment. The lack of WIM in all of these phases is based on a restricted understanding of its benefits. Some wells may have a lifetime of a hundred years, including possible sidetracking out of old casings and a final abandonment that lasts “forever.” It is a huge task the well owner has undertaken. But that task can be managed under a profitable WIM system consisting of three factors: preventing leaks, identifying leaks, and stopping leaks.

Operating a Well

During the design phase of a well, it is prudent to look at its planned life cycle, keeping in mind that some day the well will be abandoned. A well can be produced from a high-pressure reservoir; then, later in life, it may require gas lift, while at a later stage, it may serve as an injector before it is abandoned. In addition, there might be plans for sidetracks. Such a life cycle requires the selection of proper material, especially in the casing. The tubing is more cheaply replaced and is the part of the well exposed to the most hostile environment. Tubing cannot be expected to last forever. It is often more prudent to sacrifice some quality initially in a well to reduce investment and then compensate by a more active maintenance program during operation. It also may be economically profitable to postpone the investment. But it is not possible to design, drill, and complete a well that will escape the need for intervention throughout its lifetime (unless its lifetime is just a few years).

Different companies have different WIM systems, but the important focus should be on operating and maintaining the well in a safe manner to save money and keep up production. A good system should contain the following (Fig. 1):

Fig. 1—Elements of a good WIM system.

• An accountable person.
• Qualified well-operation procedures.
• Qualified intervention procedures.
• A tubing/casing-monitoring program.
• A wellhead and tree maintenance program. 
• A downhole-safety-valve program.
• A drilling and well-intervention policy.

Setting up such a system is not hard, and most oil and gas operators seem to have a system in place. The less promising aspect is the industry’s inability to avoid making this just a paper exercise. In general, barrier criteria should be found in

• Industry standards (e.g., American Petroleum Inst., Norsok).
• Company regulations, based on risk analysis.
• Regulatory bodies.
• Operational experience.

All companies are obliged to comply with company regulations and regulatory requirements. However, there is a tendency for many operators to use waivers as soon as they observe a discrepancy. The waiver is usually approved under the presumption that the operator is paying close attention to the development of the failed barrier and is planning corrective action. Some operators seem to ignore all signs of a failing barrier, which is documented when they finally decide to pull the tubing and it needs to be fished out of the well. This is a misunderstood way to handle the company’s WIM and a costly and uneconomical exercise.

When a barrier shows a failing tendency, a monitoring program should be launched and the problem quantified. A failing tubing will expose the casing to corrosive wellbore fluids for which the casing seldom is designed. If the casing is lost, the workover costs will be high. A monitoring program should contain the following:

1. Identify annulus fluids and volumes. Decide what compressibility to use in leak-rate calculations
2. Record a pressure buildup. This monitoring should be taken after a bleedoff sequence so the calculated leak rate would be as close to all open flow (AOF) as possible.
3. Calculate a leak rate.

If the calculated leak rate exceeds the barrier failure criteria, or if the leaking fluids will corrode the casing, the next step would be to conduct different pressure tests to try to identify where the leak is coming (i.e., which pressurized system is leaking into the volume experiencing a pressure buildup).

The next question is: Are there any remedial treatments to be performed?

Undoubtedly, the most expensive solution would be pulling the tubing and casing out of the well. This is definitely a last resort—not only are the direct costs high, but there is additional cost because of deferred production because the well will be shut in for a longer period of time.

Today, the service industry is offering several methods of fixing a tubing leak. Even if a movable part such as the expansion joint is failing, there are ways to repair that without pulling the tubing. A tubing repair is unlikely to last the remaining lifetime of the well if the horizon is long, but it will cost far less than replacing the tubing and also will postpone a full workover. If action is taken before the whole tubing is lost, tubing failures can be repaired by straddle packers, solid expandable tubulars, chemicals for small leaks, or by replacement of removable downhole equipment.

All of these methods have the ability of postponing a major workover. To conduct remedial treatments in the well as soon as a tubing is failing is extremely good economy, if for nothing more than to protect the casing. Casing leaks are far more complicated to repair and far more costly. Under favorable conditions, though, even a minor casing leak can be fixed without a major workover. A small A- to B-annulus leak could be fixed with chemicals.

If the barrier failure is caused by some type of reservoir fluid leaking into one of the outer annuli, even this can be fixed without a major workover by placing a particulate paste in the annulus in question. A particulate paste is an impermeable substance that does not set up and become rigid as cement. The paste maintains its ductility after placement in the well. In short, find the cheapest method of repair to keep the well on production for an extended period before a full workover is needed.

Once a leak is identified, a possible leak source is found, and a preferred method of repair is chosen, the next step will be to identify the exact depth of the leak so the remedial treatment can be properly planned and executed. Today, a high-frequency ultrasound tool is available for identifying all kinds of leaks in a well; even a casing leak can be found by logging inside the tubing. This tool locates the leak point with an accuracy of a few inches, and then there is no problem in executing a cheaper repair.

To indicate the financial benefits of performing a cheap remedial treatment compared to a full workover with tubing replacement, consider this illustration:

A tubing leak has been observed, the well no longer complies with regulations, and a corrective action must be taken.

Alternative 1: Use a wireline unit, identify the location of the leak by logging, and repair the leak by running a straddle packer on wireline.

Alternative 2: Bring in a rig, pull the tubing, and replace it.

Input:
Oil price: U.S. $20/bbl*
Oil production: 500 STB/D
Tubing length: 6,500 ft
Discount factor: 8%
Estimated lifetime of well: 15 years
Waiting time for rig: 14 days
Waiting time for wireline unit: 4 days

Under these assumptions, Alternative 1 will save the operator U.S. $1,070,000, including the cost of deferred production. If there were a 50% chance that the tubing should fail again a year after it was fixed, and a multifinger caliper now indicated that the only option is to replace the tubing, the savings still would be $460,000 by fixing it cheaply the first time. Based on experience from several oil producing regions, it is fair to conclude that big money can be saved by implementing a strict WIM system with a low tolerance for leak rates in an effort to protect a well investment.

*This price is used by many oil companies during financial calculations at present date, even though the current oil price is much higher.

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