Marginal oil fields

M A R G I N A L O I L F I E L D S

Profitable Oil At Low Reserves : How?

Agenda

Case Histories For Unconventional Techniques

Unconventional Techniques For Developing Marginal Fields

Conventional Techniques For Developing Marginal Fields

Conclusion

Introduction

Challenges in marginal oil fields

In 2008, Shell’s CEO, Jeroen van de Veer, announced that the era of “easy-to-find” oil was coming to an end

1. Introduction

1. Introduction: Terminology

Commercial Fields:

Noncommercial Fields:

Marginal Fields:

Can be developed normally with high or normal profit

Unprofitable and can’t be developed

With parameters set at their best, development can be profitable at their worst economically disastrous

By definition a Marginal oil field is: a field that is economically unattractive to develop and produce.

It could be a new discovery or an already producing field.

Economical Factors that contribute in making a field marginal:

High CAPEX and OPEX

Unattractive revenue dependent on RF and production rates

Technological constraints

Government regulations and policies

Oil price

1. Introduction- Cont’d

IT’S ALL ABOUT ECONOMICS

Challenges in marginal oil fields

The two main enemies in developing marginal fields are :

the uncertainty of DATA and TIME

1. Data Acquisition Problem (Exploration Problems) Uncertainty is not specific to Marginal ones

Exploration: Heavy data acquisition programs is an impossible choice

One or two discovery wells , 3D seismic for a development decision

Appraisal drilling, long duration tests, are not applicable

2. Challenges in marginal oil fields

Number of wells required:

The economy can not bear MULTIPLYING the number of wells

They can be limited by these choices :

Intense use of horizontal wells

Multi-branched wells

Hydraulic fracturing

2. Challenges in marginal oil fields

2. Time :

We have two opposite requirements:

Go fast to have a short production period

Low production for the reservoir not to be destroyed

So, production should be optimized where:

we must reduce the velocity to insure a good recovery and have as higha rate as possible to insure profitability

2. Challenges in marginal oil fields- Cont’d

3. Production operations life:

The uncertainty necessitates transferring costs from CAPEX TO OPEX by:

a. Using existing facilities on a contractual basis

b. Leasing as much as possible the required facilities and equipment

2. Challenges in marginal oil fields- Cont’d

Conventional Techniques For Developing Marginal Fields

Cost optimization methods in marginal fields to ensure profitability :

1. Geology and exploration

Re-correlation of the geologic column as more wells are drilled

Using 3D simulation programs and available data from the nearest fields to make a good understanding of the geology of a marginal field

3. Conventional Techniques For Developing Marginal Fields

2. Drilling

Use of PDC bits to ensure longer bit life and fewer bit runs

3. Completion and production

Ensure wellbore production optimization

Sub sea completion for offshore fields


4. Stimulation

Hydraulic fracturing for low permeable formations

Acidizing


5. Processing:

Connection to the existing pipeline

Use of excess processing capacity

Use of idle equipment and material

Using the in-plant test separator as a production separator

Surface facilities debottlenecking

Use of Floating Production Storage and Offloading (FPSO) tanker

Direct electrical heat in offshore


Smart Solutions

4.1 Smart Solutions : Cable Deployed ESP

Use draw works unit instead of workover rigs to handle the tubular required of conventional ESP

Reduce workover (Operating) costs, by

retrieving an ESP without handling tubulars

4.2 Smart Solutions : Dual ESP system

Used for marginal wells to improve the production and to provide the power and reliability demanded in high-risk, high-cost producing wells.Provide an in-well, cost-effective backup system that minimizes the downtime caused by ESP failures.

Features:Access below the ESPFlow bypassAutomatic switching between ESPsParallel OR Series ESP system option

4.3 Smart Solutions : Extreme overbalance perforating

A new concept for wellbore cleaning operations

In EOP completions, tubing pressure is increased before the guns are fired and thenreleased into the wellbore with gun explosion

Because wellbore pressure exceeds rockyield strength, perforating initiates one or more small fractures beyond the zone damaged by invasion

This stimulation obviates the need forcleaning the perforation tunnel

4.4 Smart Solutions : Horizontal Drilling

Why this technology?

Increase sand face

Used for thin tight formations

Used to prevent severe coning

Can produce with optimum velocity

required for production in marginal

oil fields

4.5 Smart Solutions : Multilateral technology:

Why this technology?

Many targets at different depth scan be

reached from a single well

Less casing , less drilling time

Increases production from a single well

Commonly a wellbore less than 6 in. Diameter

Simply reducing the hole and casing sizes for each hole

interval; Consequently well cost ( mainly drilling and

completion costs) fall.

Good candidate for developing marginal fields

4.6 Smart Solutions : Slimhole technology

4.7 Gas lift Using Coiled Tubing

• CT can be used to feed the field with artificial lift gas and injector water.

• The main advantages of using coiled tubing are:

1. The cost of the pipeline is much less than the normal pipelines.

2. The required time to install the line was only a small fraction of the time required to install a butt-welded pipeline.

4.8 Smart solutions: vapor extraction(VAPEX)

Thermal method used for enhancing the heavy oil or bitumen recovery

Twice as efficient as the older cyclic steam stimulation

4.9 Tiebacks

Tieback (subsea)

is a connection between a new oil and gas discovery and an existing production facility, improving the economics of marginal fields into profitable assets.

It decrease the overall capital expenditure

4.10 Smart solution: Radial drilling

Steps: 1) Milling : milling head , fluid

2) Jetting : Fresh water or acid ,clay inhibitors

4.10 Radial drilling cont’d

4.10 Radial drilling cont’d

Radial Drilling

Hydraulic fracture

Pressure maintenance

techniques

Steam injection

Dual completion

4.10 Radial drilling &Hydraulic fracturing

Economical challenge

Are you SURE where your FRAC is going?

Advantages:

• Directing fracture by orienting laterals

• Provide a long conduit before your fracture meets resistance

• Unwanted zones

4.10 Radial drilling & secondary recovery

Pressure maintenance: Laterals are designed to enhance conventional methods of reservoir pressure maintenance:

1) Directed Water Flood

2) Directed CO2 Flood

3) Injection Wells

4.10 HOSS (heavy oil steam system)

Integration between three

technologies: radial

drilling, steam injection

dual completion

4.11 Other techniques:

SSR (self standing riser) technology:

Used in development of Deep Water marginal oil fields

• It enables early production

• Lower drilling time and cost

• Achieving fast first oil

4.11 Other drilling techniques:

1) Offshore side tracking: wells on a platform reached economic limit

Using these wells to sidetrack marginal fields

Applied in: Dessert project

2) Underbalanced drilling: wellbore pressure < formation pressure

• Providing production testing during drilling

• Reduce formation damage

• Applied in: Indonesia

In high pour point marginal oil reservoirs

4.11 Other techniques:

• Extended reach drilling:

• Enhancing production by accessing different parts of reservoir

• Common practice in many areas

• Having many challenges

• Hydraulic fracturing mostly used in marginal fields have several bad impacts on shallow water sources

• High water cut off in heavy oil marginal fields requires high number of pours which contaminate subsurface water aquifers

• Disuse of mud in radial drilling reduces formation damage

Environmental impact

Case histories

Conventional Case Studies

LOCATION DESCRIPTION SOLUTION RESULT

West QaronField

High cost for a separate pipeline

A small connection From adjacent fieldIRR changed

from -2.8% to 12%

GazwarinaField

High cost for a production

facilityUse of excess processing capacity of SUCO base

Field put on production

ZafaranaField

Effective way of handling

crude oil

Utilizing "The Floating Production Storage and Offloading (FPSO) tanker"

50% cost savingsproduction

facilities

South BdranField

Esp went down twice

Using 3.5 inches coil tubing gas lift line to transmit the gas from the nearest platform

Operating cost reduced

considerably

Conventional Case Studies Cont.


MengkapanField, Indonesia.

high water cut.

squeeze cementing Oil rate increased from 36 BOPD to 104 BOPD.

Umusadege, Nigeria Field

Economically Unattractive

Improved fiscal terms, Reduced royalty based on a sliding scale

and lower profit tax

Investment was carried out in this fields

SemberahField,Indonesia

Difficulty in conducting

detailed reservoir

study

Using the in-plant test separator as a production separator( Portable)

The integrity of the development plan

resulted in raising oil production from 5,000

to 12,000 BOPD

Unconventional Case Studies Cont.


Gemsa FieldHigh operating

costs for a marginal reserve

Cable deployed ESPReducing

workover costs

July Field

Located in a complex

structure area (Up-dip attic oil

reserve)

Horizontal drilling

Development of an estimated attic oil reserves of about

5 MMBO

October FieldHigh operating


Slim-hole Technology

Reduced the drilling cost and

saved 80% of the cost of a

conventional completion

Geisum FieldHigh operating


Convert jack-up rig to offshore platform Operating cost is reduced to 1.35

USD/Bbl

Unconventional Case Studies- Cont’d


SemberahField,

Indonesia

Difficulty in conducting

detailed reservoir study

Extreme overbalance perforating

Oil production increased from 5,000 to 12,000

BOPD

Alberta Field, Canada

technical challenges

Horizontal wells, water injection, dual ESP system, subsea tieback technology and subsea multiphase

metering.

Horizontal wells produced 15:20

000

The YounisField

high operating cost for marginal

fielduse of coiled tubing

Reduce the cost of pipe and time

needed for pipe installation

Case study from Al Alamien Field

Acid Frac :

L Bah

AR/G

M Bah

SR Pump

• For marginal oil fields , the principal criteria for selecting the field development option was : technical feasibility , economic profile , environmental considerations

• The real challenge is not in selecting the most suitable technologies but in the way these technologies will be managed.

• It is less the power of the weapons which will lead to victory than the art of using them.

• The reservoir engineering responsibility of a marginal field must be given to an engineer who ‘FEELS’ the reservoir more than to one who ‘COMPUTES’ it

Conclusion

References Technology for Developing Marginal Offshore Oilfields.

Subsea engineering hand book.

Leye A. Adetoba, SPE, Chevron Nigeria Ltd. The Nigerian Marginal Field Initiative: Recent Developments. Paper SPE 163040. Presented at the Nigeria Annual International Conference and Exhibition held in Abuja, Nigeria, 6–8 August 2012.

Samuel HUSY - Total S.A.. Marginal Fields: Technology Enables Profitability / Marginal Fields and their Challenges. Paper OTC 21382. Presented for presentation at the Offshore Technology Conference held in Houston, Texas, USA, 2–5 May 2011.

M.El Awady. MARGINAL FIELDS DEVELOPMENT IN WESTERN DESERT, EGYPT. Paper OMC 2001-27. Presented at the offshore Mediterranean and Exhibition in Ravenna, Italy , March 28-3-2001.

A. Hassan, SPE, Gulf of Suez Petroleum Company, H. Elshahawi and K. Gad, SPE, Schlumberger Oilfield Services. An Integrated Approach to Marginal Field Development: Case History from the Gulf of Suez. Paper SPE 64661. Presented at the SPE International Oil & Gas Conference and Exhibition in China held in Beijing, China, 7–10 November 2000.

Franco Bottazzi - ENI E&P Division. Marginal Field Development Using CT Completion. Paper SPE 81706. Presented at the SPE/ICoTA Coiled Tubing Conference held in Houston, Texas, U.S.A., 8–9 April 2003.

Oluropo Rufus Ayodele, SPE, and Samuel Frimpong, School of Mining and Petroleum Engineering, University of Alberta, Canada. Economics of Nigerian Marginal Oil Fields. Paper SPE 81998. Presented at the SPE Hydrocarbon Economics and Evaluation Symposium held in Dallas, Texas, U.S.A., 5–8 April 2003.

Akinpelu, L.O, SPE, Omole O.A., SPE – University of Ibadan, Ibadan. Economics of Nigerian Marginal Oil Fields – Identifying High Impact Variables. Paper SPE 128343. Presented at the 33rd Annual SPE International

Technical Conference and Exhibition in Abuja, Nigeria, August 3-5, 2009.

John Conway, Doug Rogers, VECO, Canda. MARGINAL OIL FIELDS. Paper WPC 30180.

References Cont’d

Quotes

If Opportunity doesn’t Knock, build a door.

Despite hard work, when you are done it’s awesome.

Quotes Cont’d

Great days with great team. Individually we are one drop. Together, we are an ocean.

I had an amazing adventure and great experience the last month, ( it was a win-win deal ).

Union with discipline is the hidden power which creates success

Quotes Cont’d

Thank You

Education

Marginal oil fields