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Reserves/Asset Management

As a member of the JPT Editorial Committee, I am privileged to review papers presented at SPE events during the last year in the area of Reserves and Asset Management. I am always impressed by the highly skilled, innovative members of our Society who address the constant change in our industry in these papers.

Recently, many of the reserves papers have focused on changes in reserves and resource estimation resulting from the introduction of the Petroleum Resource Management System (PRMS) and the US Securities and Exchange Commission’s (SEC’s) Modernized Rules. Last year, many of the papers dealt with theoretical aspects of reserves estimation in unconventional plays. This year, most of the papers dealt with unconventional reserves, focusing on integration of theoretical and practical aspects of the engineering principles used to estimate reserves and resources. Several papers went full circle to address how issues around PRMS or the SEC’s Modernized Rules affect reserves and resource estimation in unconventional resources.

There was a similar shift in asset-management papers. Prior years were weighted heavily toward theoretical-optimization approaches, primarily focused on surface facilities. This year, there were many excellent papers addressing the practical application of those principles in technically challenging, high-cost environments. Integration of surface and subsurface components to improve efficiency was another recurring theme.

The fact that I could select only a few of the many outstanding papers that I reviewed highlights the importance of attending the venues at which these papers are presented. The insight provided during the presentation’s opportunity to ask questions yields valuable information that cannot be obtained by reading the paper alone. I selected the papers for highlighting and those recommended for additional reading with a view to the needs and interests of the membership of our global society. I hope I found something that will benefit each of you.

Read the paper synopses in the December 2011 issue of JPT.

Delores Hinkle, SPE, is Director, Corporate Reserves, for Marathon Oil Company. She has worked for Marathon for 25 years and has 35 years of experience in the oil industry, including positions at Atlantic Richfield Company and Sun. Hinkle has served as Chairperson of the SPE Oil and Gas Reserves Committee and served on the 2010 SPE Hydrocarbon Economics and Evaluation Symposium Steering Committee and the 2009 SPE Annual Technical Conference and Exhibition Management Program Subcommittee. She serves on the JPT Editorial Committee and on the SPE Gulf Coast Section Scholarship Committee. Hinkle earned a BS degree in petroleum engineering from the Missouri University of Science and Technology and an MBA degree from the University of Alaska, Anchorage.

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SPE Production and Operations: featured papers

View the entire November 2011 issue.

140937-PA – Review of Electrical-Submersible-Pump Surging Correlation and Models
Jose Gamboa and Mauricio Prado, The University of Tulsa

142764-PA – Assessing Gas Lift Capability To Support Asset Design
James W. Hall, SPE, and Mubarak A.M. Jaralla, Qatar Petroleum

144573-PA – World’s Deepest Through-Tubing Electrical Submersible Pumps
J.Y. Julian, SPE, BP; J.C. Patterson, SPE, ConocoPhillips; and B.E. Yingst, SPE, and W.R. Dinkins, SPE, Baker Hughes

140228-PA – Case History: Lessons Learned From Retrieval of Coiled Tubing Stuck by Massive Hydrate Plug When Well Testing in an Ultradeepwater Gas Well in Mexico
Victor Vallejo Arrieta, Aciel Olivares Torralba, Pablo Crespo Hernandez, and Eduardo Rafael Román García, PEMEX; and Claudio Tigre Maia and Michael Guajardo, Halliburton

134483-PA – New Perspective on Gas-Well Liquid Loading and Unloading
C.A.M. Veeken, SPE, NAM, and S.P.C. Belfroid, SPE, TNO

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SPE Economics & Management: October 2011

View the October 2011 issue of SPE Economics and Management.

133044-PA – Valuation of Swing Contracts by Least-Squares Monte Carlo Simulation
B.J.A. Willigers, SPE, Palantir Economic Solutions, S.H. Begg, SPE, University of Adelaide, and R.B. Bratvold, SPE, University of Stavanger

147910-PA – Optimization of Equity Redeterminations Through Fit-for-Purpose Evaluation Procedures
Paul F. Worthington, SPE, Gaffney, Cline & Associates

125178-PA – Improving Allocation and Hydrocarbon Accounting Accuracy Using New Techniques
R. Cramer and D. Schotanus, Shell Global Solutions; K. Ibrahim, Brune Shell Petroleum; and N. Colbeck, Hess Corporation

146530-PA – Demonstrating Reasonable Certainty Under Principles-Based Oil and Gas Reserves Regulations
R.E. Sidle, SPE, Texas A&M University, and W. John Lee, SPE, University of Houston

154056-PA – Unconventional-Natural-Gas Business: TSR Benchmark and Recommendations for Prudent Management of Shareholder Value
Ruud Weijermars, Delft University of Technology, and Steve Watson, Ashridge Business School

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SPE Reservoir Evaluation & Engineering: featured papers

View the entire October 2011 issue of SPE Reservoir Evaluation & Engineering.

Seismic Data Integration

131310-PA – Preselection of Reservoir Models From a Geostatistics-Based Petrophysical Seismic Inversion
M. Le Ravalec-Dupin, SPE, G. Enchery, A. Baroni, and S. Da Veiga, IFP Energies Nouvelles

131538-PA – Seismic History Matching of Nelson Using Time-Lapse Seismic Data: An Investigation of 4D Signature Normalization
Alireza Kazemi, Karl D. Stephen, SPE, and Asghar Shams, Heriot-Watt University

Advanced Numerical Techniques

141207-PA – Near-Well-Subdomain Simulations for Accurate Inflow-Performance-Relationship Calculation To Improve Stability of Reservoir/Network Coupling
B. Gűyagűler, SPE, and V.J. Zapata, SPE, Chevron; H. Cao, SPE, Total; H.F. Stamati and J.A. Holmes, SPE, Schlumberger

SPEPO

SPE Production & Operations: featured papers

View the entire August 2011 issue of SPE Production & Operations.

Scale Inhibition

98774-PA – What Would Be the Impact of Temporarily Fracturing Production Wells During Squeeze Treatments?
Abdul Al-Rabaani, PDO, and Eric J. Mackay, Heriot-Watt University

141384-PA – Modeling the Application of Scale-Inhibitor-Squeeze Retention-Enhancing Additives
O. Vazquez, Heriot-Watt University; P. Thanasutives, PTT Exploration and Production Plc; C. Eliasson and N. Fleming, Statoil; and E. Mackay, Heriot-Watt University

Stimulation

132535-PA – Laboratory Study of Diversion Using Polymer-Based In-Situ-Gelled Acids
A.M. Gomaa, SPE, M.A. Mahmoud, SPE, and H.A. Nasr-El-Din, SPE, Texas A&M University

133380-PA – Methods for Enhancing Far-Field Complexity in Fracturing Operations
Loyd East Jr., SPE, Halliburton; M.Y. Soliman, SPE, Texas Tech University; and Jody Augustine, SPE, Halliburton

SPEEM

SPE Economics & Management: July 2011

View the July 2011 issue of SPE Economics and Management.

148542-PA – Discretization, Simulation, and Swanson’s (Inaccurate) Mean
J. Eric Bickel, SPE, and Larry W. Lake, SPE, University of Texas at Austin; and John Lehman, Strategic Decisions Group

134811-PA – Stochastic Analysis of Resource Plays: Maximizing Portfolio Value and Mitigating Risks
Paul D. Allan, SPE, Portfolio Decisions International

130089-PA – Survey of Stranded Gas and Delivered Costs to Europe of Selected Gas Resources
E.D. Attanasi and P.A. Freeman, US Geological Survey

134237-PA – Qualifying Seismic as a “Reliable Technology” — An Example of Downdip Water-Contact Location
R.E. Sidle, SPE, Consultant; and W.J. Lee, SPE, Texas A&M University

127761-PA – Probabilistic Modeling for Decision Support in Integrated Operations
Martin Giese, University of Oslo, and Reidar B. Bratvold, SPE, University of Stavanger

144490-PA – Moving the Energy Business From Smart to Genius by Building Corporate IQ
Ruud Weijermars, Delft University of Technology

SPEDC

SPE Drilling & Completion: featured papers

View the entire September 2011 issue of SPE Drilling & Completion

134563-PA – Continuing Application of Torque-Position Assembly Technology for API Connections
James P. Powers, SPE, ExxonMobil Development Company; and Michael S. Chelf, SPE, ExxonMobil Upstream Research Company

135462-PA – A Major Advancement in Expandable Connection Performance, Enabling Reliable Gastight Expandable Connections
Richard DeLange, SPE, Raju Gandikota, and Scott Osburn, SPE, Weatherford International

119468-PA – New Standard for Evaluating Casing Connections for Thermal-Well Applications
Jaroslaw Nowinka, SPE, and Dan Dall’Acqua, SPE, Noetic Engineering 2008

139829-PA – Casing Design With Flowing Fluids
Robert F. Mitchell, Halliburton

139824-PA – Lateral Buckling–The Key to Lockup
Robert F. Mitchell, Halliburton, and Tore Weltzin, Statoil

 

 

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Gas Production Technology

It was not long ago that finding a natural-gas field beneath your property was viewed universally as a stroke of good luck. Now, local natural-gas development is feared by many who assume the “new technology” of “fracing” is environmentally harmful. In reality, the first hydraulic-fracturing treatment was tested in a North Carolina granite quarry way back in 1903. Hydraulic fracturing has been used successfully in more than a million wells since then, and, currently, hundreds of fracturing stages are pumped every day. Very impressive for a “new” technology!

Partly because of these very successful and trouble-free wells, natural gas has enjoyed an enviable reputation as a clean, cheap, and abundant energy source. However, we need only to look to the nuclear industry to see that a hard-won reputation can be ruined by false rumors, isolated incidents, or the worst examples of safety, environmental, and reporting practices. If we always strive to be good neighbors in the communities in which we work, we can remain proud natural-gas producers for years to come.

Because stimulated wells make up an increasing portion of supply with each passing year, we have become dependent upon wells that require additional attention and often exhibit high decline rates. To buffer the supply/demand swings, gas-storage wells are used for both injection of dehydrated pipeline gas and production of newly saturated formation gas. Water-vapor equilibrium will reduce the water saturation around injection wellbores but may increase salt precipitation in the same region. A new study from the Middle East describes a means of maximizing sand-free gas-production rates from wells in unconsolidated zones, without a difficult-to-place hydraulic fracture. A third paper describes a means of identifying well candidates that may need a second treatment because of deterioration of the original fracture or the need to access additional reservoir. A downloadable full-length technical paper provides a new decline-curve functional form that can match unconventional wells with long transient-flow periods w hile honoring late-time interference and depletion. These papers provide some legitimately new technology.

Read the paper synopses in the November 2011 issue of JPT.

Scott J. Wilson, SPE, is a Senior Vice President of Ryder Scott Company. He specializes in well-performance prediction and optimization, reserves appraisals, simulation studies, software development, and training. Wilson has worked in all major producing regions in his 25-year career as an engineer and consultant with Arco and Ryder Scott. He is Cochairperson of the SPE Reserves and Economics Technical Interest Group and serves on the JPT Editorial Committee. Wilson holds a BS degree in petroleum engineering from the Colorado School of Mines and an MBA degree from the University of Colorado. He holds two patents and is a registered professional engineer in Alaska, Colorado, Texas, and Wyoming.

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Horizontal and Complex Trajectory Wells

Geometrically complex and horizontal wells are constructed to deliver additional production with fewer environmental effects. The continuous success with which we are able to drill, complete, operate, and maintain wells having demanding profiles positioned for stronger reservoir performance is the result of service companies, drilling companies, operators, and technical institutions developing ever-more-advanced and -reliable technology. As new technologies are put to work, new techniques are developed to reduce operational risk, increase payback, and improve efficiency, thereby pushing the boundaries of what previously was considered technically improbable to achieve or uneconomical. As a result, higher-value wells are constructed. Development of these new technologies and techniques continues, but none of this is possible without technically competent experienced people.

Well-construction activity has ramped up over the past 2 years. This activity ramp is occurring simultaneously in established areas and “frontier” locations that are remote from upstream infrastructure or are lacking local expertise. As a result, it is challenging to ensure that complex wells gain the focus of the most-experienced technical personnel to deliver acceptable performance consistently. While remote operating centers alleviate some of this challenge, the need for technical training and competency development probably has never been greater than it is today. However, the opportunities to achieve this have never been greater.

Every well we construct and operate presents on-the-job-training and competency-development opportunities. We should make greater efforts in identifying these opportunities and in committing to exploiting them. This should be more widely recognized at the planning phase by documenting training opportunities as key well objectives. Achieving these objectives would enhance the value delivered from each well.

It is only by focusing on development of people, existing and new to our industry, that the boundaries of horizontal and complex wells will continue to expand, adding production with fewer environmental effects. This must persist irrespective of the business cycle because while there are efficient methods of attaining technical proficiency by commitment to well-structured programs, there are no shortcuts.

Read the paper synopses in the November 2011 issue of JPT.

Jon Ruszka, SPE, is Field Career Development Manager, Baker Hughes Africa Region. He has more than 25 years’ industry experience in various technical, operational, and marketing positions, primarily focused on the application and advancement of directional-drilling technology and techniques. Ruszka earned a BSc Honours degree in aeronautical engineering from the University of Bristol and a post-graduate diploma with distinction in offshore engineering from Robert Gordon Institute of Technology, Aberdeen. He has authored and presented several SPE papers and serves on the IADC/SPE Drilling Conference & Exhibition Organizing Committee and the JPT Editorial Committee.

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Drilling and Completion Fluids

When you take a look at the oil industry these days, what is the one thing you hear and read about the most? “Shale plays.” Operators are developing resources, purchasing acreage, and purchasing companies that have acreage in the USA and in countries around the world, now more than ever before.

For long-term economic stability of these projects, they need to be drilled as inexpensively and as fast as possible–basically, they need to be “factory-type wells.” The main fluid-related challenges associated with shale drilling are rate of penetration (ROP), shale stability, torque and drag, and waste management. Many of these wells are being drilled with nonaqueous fluids (NAFs) to meet these challenges, with the only real issue being waste management. However, there are technologies being used that reduce the amount of waste generated with NAFs, such as premium solids-control systems and thermal-desorption methods.

In an effort to eliminate NAF waste-management issues, drilling-fluids companies have developed fit-for-purpose water-based drilling fluids for each of the major shale plays. The shale regions around the world vary in depth, mineralogy, temperature, and other characteristics, and a single fluid formulation does not fit all circumstances. Each fluid is customized to the unique characteristics of a particular shale region. Fluids companies have specific products and chemistries that are designed for a specific type of shale and drilling operation.

As technological advances enable exploitation of shale resources around the world, the challenge will be to find the most-cost-effective solution. As always, the lowest overall well cost may not result from the lowest-cost-per-barrel drilling fluid. One has to take into account ROP, torque and drag, wellbore stability, and waste management when determining the most-cost-effective solution.

There were many good papers written this year, and I have tried to choose a variety of universal topics. Please take time to read them and the papers listed as additional reading.

Read the paper synopses in the November 2011 issue of JPT.

Brent Estes, SPE, is a Drilling Fluids Specialist for Chevron Energy Technology Company supporting worldwide drilling operations. Previously, he was with ExxonMobil and Baroid Drilling Fluids. Estes earned a BS degree in petroleum engineering from Texas A&M University. He has a broad background in all aspects of drilling and completion fluids, including fluids research and development and working as a drilling engineer. Estes has authored several SPE papers and serves on the JPT Editorial Committee.