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European Unconventional Resources
European Shale – The Next Challenge
IADC Bucharest May 23rd, 2012
Doug Bentley, European Unconventional, Schlumberger
European Unconventional Resources
Transforming an Industry
Barnett
Antrim
Lower Huron
2000
2011
Schlumberger Oilfield Review Autumn 2011
European Unconventional Resources
Shale Gas Development Benefits
0
40
80
120
160
200
D&C
Spen
d $B
Land Offshore
US Drilling and Completion Spend
Source: Spears D&P Dec 2011
– New Long Term Energy Resources ● Large Resource Base ● Energy Security & Independence
– Economy Benefits ● >100,000 Potential Jobs ● Local Business Growth ● Community Improvements
Resource Opportunities
Shale Gas Development Challenges Understanding the Scale
Source: Smith Bits STATS; SBC analysis
US: RIGS FOR OIL AND GAS BY TYPE OF WELLWEEKLY AVERAGE
0
200
400
600
800
1,000
1,200
1,400
1,600
1,8001,641
1,324
954
201120052000
80%
70%
60%
50%
40%
30%
20%
VerticalHorizontalDirectional
% of Horizontal + Directional (right axis)
2011 Estimates US Land Rigs 1600+ Horizontal Wells 17,000+ Frac Stages 200,000+ Prop/Stage 300,000 -600,000+ lb Water/Stage 9,000 - 15,000+ bbl
US: AVERAGE FRAC STAGE COUNT
10
8
5
6
10
14
12
10
6
8
12
19
15
12
8
10
15
25
15
15
8
10
16
27
0 10 20 30
Haynesville
Marcellus
Fayetteville
Barnett
Eagle Ford
Bakken
Number of fracturing stages
2011 2010 2009 2008
European Unconventional Resources
Key Concerns Faced
– Conservation of Natural Resources ● Protection of Water Resource
» Initial baseline testing » Sourcing » Reuse » Well Integrity » Monitoring
● Environmentally Engineered Fracturing
– Operational Intensity ● Surface Footprint ● Increased Infrastructure Strain ● Increased Traffic, Noise, Emissions
Shale Gas Development Challenges VS
European Unconventional Resources
Conserving Natural Resources – Reducing at the Source
Channel Fracturing Technology Precision Fracture Placement > 4500 stages pumped (9 countries, 5
Areas)
Reduced footprint:
500,000,000 lb proppant
150,000,000 gal water
Reducing Materials is Key Remote access in many areas Transportation Issues Supply Chain Issues Resource Availability
Technologies to Reduce Materials
European Unconventional Resources
Water Sourcing ● Municipal ● Water wells: shallow and deep ● Ponds, Streams and Rivers ● Re-use/ Treatment ● Sea Water
Transportation ● Number of trucks in the road ● High tendency to pipe the system
Water Storage ● Temporary / Long Term Planning ● Use of ponds, impoundments, frac tanks ● Re-usable above ground storage. Low
environmental impact. Regulations
● Permits of water sourcing ● Dictate discharge criteria
Conserving Natural Resources – Water Management
European Unconventional Resources
Conserving Natural Resource – Water Reuse M-I SWACOWater Treatment Technologies• Filtration• Chemical• Mechanical• Biological• Membranes• Thermal
Clean Water Returned ToHydrologic Cycle
Wat
er R
etur
ned
for
Reu
se
Close Loop System100% Recycle
Pro
duce
d W
ater
Disposal/Water Flooding/ Steam Injection
Discharge
Underground Storage
European Unconventional Resources
Current USL Regs
USL CBM
Some US State
Regulators (Non-Oilfield)
Customer Base Customer Base
US Federal
Gov’t
MSDS Disclosure
ManyUS State
Regulators (Traditional
Oilfield)
Some Enviro Orgs
GeneralPublic
Increased Fluid Disclosure
Incr
ease
d Co
mpo
und
Rest
rict
ions
Time
Conserving Natural Resources Environmentally Engineered Systems
Fully Disclosable Fracturing Fluids Designed to Comply with Environmental Standards
What is being asked for today
European Unconventional Resources
Conserving Natural Resources – Well Integrity
Hole QualityCaliper
Real-TimeBoreholeGeometry
Mud Removal Design
Well Clean II*Spacer Design
Casing Centralization
Slurry Placement
Fluid System Design
Gas migration control (gel strength; transition time; fluid
lossCemSTRESS*
analysis
ExecutionFlexSEAL* / FUTUR*Flexible & Expandable
Self-sealingCemCRETE technology
high solids content Low perm and Porosity
EvaluationCement Isolation
EvaluationIsolation Scanner*
Technology Across the Entire Process Factors to Consider Low Reservoir Pressures / Loss
Circulation Stresses on Wellbore
• Completion Phase • Production Phase
Gas on Annulus Long Term Viability
Highest Pay
Deepest Aquifer Deepest Aquifer
Highest Pay
European Unconventional Resources
Operational Intensity – Technology and Lessons Learned More Planning Less Footprint
1986
Reservoir Quality‘sweet spots’
Culture data Surface restrictions
Pad Placement Favorable reservoir and pad location
Pad Well Design
Reservoir Quality‘sweet spots’ Culture data
Surface restrictionsPad Placement
Favorable reservoirand pad location Pad Well Design
FDP
2008 Close Collaboration will be Required
Integrating it All Together
Mega Pads
European Unconventional Resources
It will take the application and adaption of technology It will take investment in developing new technology It will require good planning It will require new regulations It will take close collaboration We need to manage it together as an industry
Environmental Concerns Can be Addressed
European Shale Thank You
