EOR Global Markets, Challenges, and Opportunities

Atlanta, Aug 5, 2011

Song Cao Global Synergy Corporation

Presentation Topics

 EOR Concept/Terminology Review  EOR Global Markets  EOR Challenges/Opportunities

 Discussion

EOR Concept/Terminology Review
EOR (Enhanced Oil Recovery) Terminology  IOR - Improved Oil Recovery  Tertiary Oil Recovery  CO2-EOR  Thermal EOR  Chemical EOR (CEOR)  Microbial EOR (MEOR)  Pre-EOR (Conformance Control)

EOR Concept/Terminology Review IOR and EOR .

EOR Concept/Terminology Review Field-Proven Solution .Chemical EOR Chemical 1: Surfactant (to increase microscopic displacement efficiency) Chemical 2: Polymer (to increase volumetric sweep efficiency) .

EOR Concept/Terminology Review .

EOR Concept/Terminology Review .

EOR Concept/Terminology Review .

(To increase volumetric sweep efficiency and microscopic displacement efficiency)  Alkali-Surfactant-Polymer Flood (ASP) – Advanced SP flood.EOR Concept/Terminology Review Summary of Polymer Technologies  Polymer Flood (P) – Basic chemical flood. (Mobility Controller to increase volumetric sweep efficiency)  Surfactant-Polymer Flood (SP) – Advanced Polymer flood. (Using alkali as sacrifice agent to reduce surfactant usage) .

it only can remove ~20-30% of the original oil in place after waterflood .EOR Review (Pre-EOR) Common Problems with Mature Oilfields (1) Injector Producer  Need secondary recovery (waterflood) after primary methods been exhausted  Left oilfields with high water cut. low production rate. and depleted reservoirs  In general.

EOR Review (Pre-EOR) Common Problems with Mature Oilfields (2) Homogeneous Reservoir .

EOR Review (Pre-EOR) Common Problems with Mature Oilfields (3) Heterogeneous Reservoir .

EOR Review (Pre-EOR) Common Problems with Mature Oilfields (4) Heterogeneous Reservoir .

EOR Review (Pre-EOR) Common Problems with Mature Oilfields (5) Solution: Conformance Control (or Pre-EOR) .

Much of it is recoverable by Chemical EOR.” – Society of Petroleum Engineers 2.000 billion barrels Market value at $50/bbl  $100 Trillion SPE ST200601 .EOR Global Markets Immense EOR Market Potential (1) “Worldwide unrecoverable oil about 2.000 billion barrels.

2005 .): 649 Billion Barrels 170 Billion Barrels Already Abandoned Target for EOR NETL-DOE.S.EOR Global Markets Immense EOR Market Potential (2) Original Oil in Place (U.

EOR Global Markets Major EOR Applications and New Markets New Market .

but small market size  Middle East (Great Potential) o Oman: very aggressive o Other countries: considering it  New Markets with Great Potential: South America. Russia. Africa .EOR Global Markets World EOR Market Summary  North America (Good Potential) o USA: slowly picking up o Canada: picking up  Asia (Great Potential) o China: very active (hot!!!) o Indonesia: slow but moving forward o India: pushing forward.

primarily due to the oil price collapse. then decreased tremendously. N2) leading EOR. Currently accounting only about 1% of total oil production!  Miscible Gas EOR (CO2.EOR Global Markets . but invest large capital in high return projects such as deepwater. HC. outside of US  Many old oilfields are in waterflood with high water cut and most of them are operated by middle-small size companies (easy to work with!) . shale gas. accounting about 10% of US oil production  Chem-EOR recently picking up due to high oil price  Majors are fully equipped with “know-how” and $.USA USA EOR Market Summary  Chem-EOR started in US in early70’s and reached peak in early 1986.

EOR Global Markets .USA USA EOR Market Summary .

USA USA EOR Market Summary .EOR Global Markets .

USA EOR Is Very Sensitive to Oil Price .EOR Global Markets .

USA Major States with Chem-EOR Projects  Texas  Oklahoma  Wyoming  California  Illinois  Kentucky  New Mexico .EOR Global Markets .

EOR Global Markets China EOR Market Summary  National policy to “squeeze out” every possible barrel of oil  Largest fields in decline: o 85% of China’s oil production .onshore mature fields o Major oilfields are over 40 years old with high water cut as high as 85-95% on average  Improved on US Technology: o Commercial polymer flooding started in 90’s o 46% of CNPC new reserves added by polymer flooding o New EOR technologies being continuously invented RESULT: Over 60% Recovery Rate Being Reached China Leads the World in Chemical EOR .

EOR Global Markets .China Major EOR Projects In China Huabei Zhongyuan Liaohe Daqing Xinjiang Dagang Henan Shengli .

China Chemical EOR will be the Dominant EOR Method for Future EOR Reserves in China AP 2% Polymer 24% ASP 50% Thermal 11% Immiscible 5% Miscible 8% Total 2 billion tons (14 billion barrels) recoverable EOR reserves in China .EOR Global Markets .

85 mmbopd)  About 90% water cut in main oil-producing reservoirs. SP and ASP flooding)  50-60% recovery percentage in major oil producing reservoirs  The world largest EOR application . accounting about 40% of China total onshore oil production  Peak annual production of 50 million tons (1 mmbopd) for 27 years and currently about 40 million tons per year (0.EOR Global Markets .China EOR in Daqing Oilfield  The largest oil-producing field in China with a total cumulative oil production of 2 billion tons (14 billion barrels). About 25% of the total oil production from the application of EOR (polymer flooding.

China Daqing Polymer Flooding Process Optimization .EOR Global Markets .

EOR Challenges and Opportunities Major Challenges in Gas/Waterflood (Pre-EOR) Poor Conformance  Poor areal sweep by injected fluid and early breakthrough at offset producers  Uneven vertical sweep due to channeling of injected fluid through thief zones or fractures We have to “recondition” the reservoir before doing EOR .

EOR Challenges and Opportunities Favorable Characteristics for Polymer Flooding • High remaining oil saturation (>25%) • High permeability (>10 md) and porosity (>15%) • Light oil with viscosities less than 500 cp? • Good results in sandstones over carbonates • Reservoir is not highly fractured • Short project life due to favorable combination of small well spacing and/or high injectivity • Fresh water and/or soft water (Salinity) • Reservoir temperatures less than 250 F What or could you do EOR if the above conditions are not there? .

EOR Challenges and Opportunities Polymer Technology Comparison Aspect Polymer Flood SurfactantPolymer Flood AlkaliSurfactantPolymer Flood EOR Efficiency Chemical Cost Operation Cost Scaling Problem Economics .

 Alkaline agents are a hazardous material and must be handled with care when mixing. a higher concentration of polymer is needed compared to that required for a solution with no alkali.EOR Challenges and Opportunities ASP Challenges  Scale in the producing well can form due to the alkali mixing with produced water from different zones or from reaction by-products due to the alkali reacting with the reservoir rock.  More difficult to treat the produced water (or fluids) .  Because alkali shrinks the size of the polyacyrlamide polymer in solution.

TX 77036 713. Song Cao President Global Synergy Corporation 6161 Savoy Drive. Suite 1030 Houston.9588 office phone 713.822.0661 cell phone 713.785.9588 fax Email: songcao@globalsynergycorp.785.com .Contact Information Dr.

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