Lead author Mujeeb Mahadik

PRODUCtION DECLINE ANaLYSIS aND FORECaStING IN tIGht-GaS RESERVOIRS

Department of Petroleum Engineering 613 (rear), level 6, ARRC Curtin University 26 Dick Perry Avenue Kensington WA 6151 M.Mahadik@postgrad.curtin.edu.au

M.K. Mahadik , H. Bahrami, M. Hossain and P.A. Tsar Mitchel

ABSTRACT
Exponential decline curve analysis is widely used to estimate recoverable reserves due to its simplicity. In most cases, however, an exponential model cannot provide a satisfactory match of overall production history. The generalised form of a hyperbolic decline model is more powerful in matching production history than the other decline models, but it is difficult to apply in practical production data analysis since it requires predicting two unknowns as decline constants. Although a hyperbolic model may provide a good fit to early-time production decline data; it may overestimate the late-time production, especially for hydraulic fractured wells in a tight-gas reservoir. In fact, the exponential decline model might be more reliable for forecasting the late-time production. This paper presents a practical approach to production decline analysis for non-fractured and fractured wells in a tight-gas reservoir using numerical simulation. Some production rate functions and type curves are introduced to obtain the best matching values of hyperbolic, exponential and harmonic production decline constants. The simulated production rate decline data for various well and reservoir parameters are used to indicate the optimum time duration of use of each decline model and to show the time when the production decline starts following the exponential model. The proposed approach is applied in production data analysis and forecasting for a tight-gas field in WA. The results showed good agreement with the production forecast obtained from a reservoir simulation.

hyperbolic; and, harmonic. Nevertheless, at the beginning of the wells production decline trend, extrapolating forward involves much uncertainty. Decline curve analysis techniques are a substitute for the volumetric and material balance method. At times, based on the type, quantity and quality of the data available, decline curve analysis is the only method available for measuring reserves (Rushing et al, 2007). For example, material balance requires estimation of stabilised shut-in bottomhole pressures (BHPs); however, in low permeability reservoirs the BHPs are not available due to the long period of time needed for stabilisation (Lee and Wattenbarger, 2008) Although decline curve analysis is an excellent tool used to estimate the production in conventional oil and gas reservoirs, it should be applied under proper conditions. Normal application of decline curve analysis has the following assumptions (Lee and Wattenbarger, 2008). Type curves are generated with constant bottom-hole flowing pressure. The permeability and skin of the reservoir is kept constant, thus any changes in reservoir parameters due to stimulation strategies will affect the reserve estimates. If there is no true boundary dominated flow then there is no theoretical basis and the future predictions can be inaccurate. Late-time production data in a reservoir located off-center may not represent true boundary-dominated flow. Decline curve assumes for a volumetric reservoir, meaning there is no energy from outside, such as pressure from an aquifer. If any of these assumptions are violated, it may result in significant errors in the reserve estimates. These are even greater in tight-gas reservoirs due to the complexity of geological and petrophysical systems, as well as the large scale of heterogeneities (Rushing et al, 2007).

PRODuCTION DECLINE ANALYSIS

A method presented by Arps in the 1950s has been used due to its simplicity, and since it is based on empirical methods it does not require any reservoir parameters. The Arps equation is used to curve-fit the production data and to get the best fit by changing the decline constants. The general Arps rate/time equation represents hyperbolic decline behaviour as shown in Equation 1.

KEYwORDS
Production decline analysis, production forecasting, tight-gas reservoirs, decline models, rate derivative function, effect of well and reservoir parameters, decline constant, decline exponent.

INTRODuCTION
Reservoir production performance analysis and forecasting are fundamental responsibilities for a reservoir engineer. There are several techniques that help to predict the production profile; one of the most common methods used is known as decline curve analysis. Typically, a decline curve analysis is begun by plotting stable initial production rates in detail against a short period of time. The extrapolation of the existing early-time data is generally carried out with three decline trends: exponential;

qt =

qi

Where qi is the initial production rate, t is elapsed time, Di is the initial decline constant, and b is the decline exponent. In the Arps equation, if b equals zero, it represents exponential decline behaviour, as shown in Equation 2.

(1 + bDi t ) b

(1)

qt = qi e Di t

(2)

If b equals one, it corresponds to harmonic decline, as shown in Equation 3. APPEA Journal 20121

SECOND PROOFMAHADIK 27 MAR 12

M.K. Mahadik , H. Bahrami, M. Hossain and P.A. Tsar Mitchel

qt =

qi (1 + Di t )

(3)

tive data can provide the optimum value for Di for production forecast applications.

The original Arps exponential model is based on boundary dominated flow, which is reached in months in conventional reservoirs. A transient-flow regime, however, can last for years as tight-gas is produced through a group of fractures, tight zones or horizontal sections. Therefore, the engineers have resorted to using b in the Arps equation that generates the curved portion of the production decline hyperbolically, before it straight lines into a late-time exponential decline (Ryder Scott Company Petroleum Consultants, 2011). The trend of early-time production data generated by the harmonic decline model is mainly affected by Di and the trend of the late-time production data is controlled by b. The Arps model is based on conventional reservoirs and does not consider the possibility of the hyperbolic exponent (b) being greater than one. There is, however, no theoretical basis for limiting the hyperbolic exponent to one. Using numerical simulation, Gentry and McCray (1978) showed that reservoir heterogeneity can result in a hyperbolic exponent to be greater than one. Furthermore, Bailey (1982) used mathematical curve fitting to determine the best fit hyperbolic equation for some fractured gas wells and found that the value of b exceeded 1. In a pseudo-radial flow in a tight-gas reservoir, the value of b ranges from 220 (Kupchenko et al, 2008). The main objective in production decline curve analysis is to determine the optimum values of the decline constant (Di) and decline exponent (b), which can be used to provide the best fit between the actual field production data and the calculated ones from a production decline model. Then, using the optimum values of the decline parameters, the wells future production performance can be predicted accordingly. With exponential and harmonic decline models, the uncertainties are low in curve fitting since the models have only one unknown Di. First, a curve is fitted on the well production data using the initial guess for Di. Then, by trial and error and trying different values for Di, the curve fitting is improved until the optimum value of Di that results in the least error between the field data and the calculated ones can be obtained. With the hyperbolic model, the uncertainties are significantly larger since there are two unknowns, Di and b, and estimating their optimum values is more challenging.

Harmonic decline
For the harmonic decline model, Equations 7 and 8 show the dimensionless production rate, and the rate derivative as a function of the decline constant and time.

qD =

1 (1 + Di t )

(7)

q ' D = (+1) * t +

Equation 8 indicates that a plot of qD versus time results in a unit-slope line with the intercept of 1/Di as shown in Figure 2. Using the plot, fitting the +1-slope line on the rate derivative data can provide the optimum value for Di for production forecast applications.

1 Di

(8)

Hyperbolic Decline:
For the harmonic decline model, Equations 9 and 10 show the dimensionless production rate, and the rate derivative as a function of the decline constant and time.

qD =

THE RATE DERIVATIVE TECHNIQuE

The rate derivative technique can be used to reduce uncertainties associated with determining optimum values for the parameters in the production decline model. The rate derivative function is defined in Equation 4.

Equation 10 indicates that a plot of qD versus time results in a straight line with a slope of b and the intercept of 1/Di as shown in Figure 3. Using the plot, fitting a straight line on the rate derivative data can provide the optimum value for b for production forecast applications. Since decline curve analysis using hyperbolic decline has two unknownsb and DiEquation 10 helps with calculating one of the constants (b), thus making it easier to do the type curve matching. The intercept of the straight line with the vertical axis cannot be used for estimation of the optimum value for Di due to the different behaviours of the hyperbolic model in early-time and late-time. Once the optimum value of b is known from the rate derivative plot, with trial and error and assuming different values of Di and checking which one gives the best fit, the optimum value of Di can be found.

(1 + bDi t ) b 1 q 'D = b * t + Di

(9)

(10)

Using the dimensionless rate (qD = qt/qi) and the rate derivative function (qD), the optimum values of the decline rate constant and exponent can be determined with fewer uncertainties.

1 q 'D : [d[ln(qD )] / dt

(4)

RESERVOIR SIMuLATION FOR EVALuATING THE PRODuCTION DECLINE BEHAVIOuR

Reservoir simulation using the KAPPA-ECRIN test-design module is used to numerically generate the production data from the models with different well and reservoir parameters. A sensitivity analysis is then performed to understand the effect of each parameter on production decline behaviour. The reservoir data and sensitivity analysis parameters used in the simulation models are shown in Tables 1 and 2. Using the proposed practical approach of production decline analysis using the rate derivative, values of the decline parameters for each of the non-fractured and fractured wells are estimated. The production rate derivative is used to calculate the value of b and interactively change the initial decline constant ( D i) to curve-fit the production profile. Once b is calculated using the derivative of production rate, the value of D i is manually changed to the curve fitting for the production data computed in the commercial reservoir software.

Exponential decline
For the exponential decline model, Equations 5 and 6 show the dimensionless production rate, and the rate derivative as a function of the decline constant and time. (5) q = e Di t

q ' D = (0 t ) +

Equation 6 indicates that a plot of qD versus time results in a zero-slope line with the intercept of 1/Di as shown in Figure 1. Using the plot, fitting the zero-slope line on the rate deriva2APPEA Journal 2012

1 Di

(6)

SECOND PROOFMAHADIK 27 MAR 12

Production decline analysis and forecasting in tight-gas reservoirs

Integrating hyperbolic-exponential models for decline curve analysis

Using the hyperbolic decline over a long period of time for production forecasting will over-estimate the reserves. As for the exponential decline, it does not give a satisfactory type curve match of the overall production data and may underestimate the reserves if it is fitted on the early-time production data. The practical approach is to fit the hyperbolic decline model on early-time data, and the exponential model on the late-time data. Therefore, it is important to calculate the time when the hyperbolic decline shifts to an exponential decline. For this purpose, production data are generated for each simulation model, and curve fitting the early-time hyperbolically and the late-time exponentially is used to calculate the time when the production starts following an exponential trend. This process was done over a period of 10 years as follows: hyperbolic fit on the first six months of production data, followed by an exponential fit on the rest of the production data for 9.5 years; hyperbolic fit on the first two years of production data, followed by an exponential fit on the rest of the production data for eight years; and, hyperbolic fit on the first five years of production data, followed by an exponential fit on the rest of the production data for five years. These steps are repeated for different reservoir parameters, and the point when the hyperbolic decline starts following the exponential trend is determined by curve fitting the early-time

hyperbolically and late-time exponentially. This procedure was repeated for eight cases of varying permeability (k) in Figure 4, skin (S) in Figure 5, and hydraulic fracture half-length (Xf) in Figure 6. By considering R2 0.9 to be a good exponential curve fit, Figures 4, 5 and 6 suggest the hyperbolic decline starts following the exponential trend between 12 years; meaning, early-time till 12 years can be curve fitted hyperbolically and the rest exponentially. If the data is curve fitted hyperbolically for the first six months and exponentially for rest of the production period, it reduces the accuracy of the curve match by giving R2 0.9. The range of time estimated is the same for both non-fractured and hydraulically fractured reservoirs.

Effect of permeability, skin and hydraulic fracture half-length on decline constants

To determine the effect of permeability, skin, and hydraulic fracture half-length on the decline constant, the values of b and Di were first plotted on a linear scale. Based on the sensitivity analysis results on the decline constants, it is noticeable that:

Figure 3. Hyperbolic decline curve and rate derivative.

Table 1. Summary of varying reservoir parameters (marked in red) with two constant reservoir properties (marked in black). Change in K Change in Xf
0.1 20 0 0.1 100 0 0.1 500 0

Change in S
0.1 0 5 0.1 0 10 0.1 0 20

Figure 1. Exponential decline curve and rate derivative.

K (md) Xf (ft) S K (md) Xf (ft) S K (md) Xf (ft) S

0.01 0 0 0.1 0 0 1 0 0

Table 2. Summary of rock, fluid and reservoir properties. Pi

5,000 psi 1,000 psi 10% 100C 0.6

Porosity Temperature

Pwf

Figure 2. Harmonic decline curve and rate derivative.

S.G. of gas (air = 1)

SECOND PROOFMAHADIK 27 MAR 12

APPEA Journal 20123

M.K. Mahadik , H. Bahrami, M. Hossain and P.A. Tsar Mitchel Di and b are inversely and directly proportional to permeability, respectively (Fig. 7); Di and b are inversely and directly proportional to skin, respectively (Fig. 8); and, Di and b are directly and inversely proportional to hydraulic fracture half-length, respectively (Fig. 9). Furthermore, the match that gave the best results was done using power fit, meaning the accuracy of the power fit was R2 0.9. Figures 79 indicate that b and Di are approximated by a power-law function and will exhibit a near-constant behaviour at very large permeability, skin, and hydraulic fracture half-length values in an infinite-acting reservoir. saved time significantly by estimating the optimum value of b directly, making it easier to estimate Di. The methodology of the hyperbolic fit on early-time and exponential fit on late-time data was also examined (Fig. 12). In Figure 12 a satisfactory match of the first year (months 112) data could be achieved using the hyperbolic model, and the late-time data after one year (months 1320) show exponential behaviour.

CONCLuSIONS
The rate derivative method can be used to find optimum parameters in production decline models. For a hyperbolic decline, the rate derivative results are in a straight line with a slope of b; for exponential decline, it is in a straight line with a slope of zero; and for the harmonic decline, it is a +1 unit slope line. The initial decline constant can directly be estimated for exponential and harmonic models using the rate derivative method. In the hyperbolic model, the rate derivative provides the hyperbolic exponent, b, and Di can be estimated by the trial and error method to get the best fit. The early-time production data can be matched using hyperbolic decline, and the late-time data follow exponential decline. The shift from hyperbolic to exponential decline is roughly between 12 years. The general effect of permeability on the decline constants was: 1. the initial decline constant decreases with an increase in k; and, 2. the hyperbolic decline exponent increases with an increase in k.

FIELD EXAMPLE: PRODuCTION DECLINE ANALYSIS IN A TIGHT-GAS RESERVOIR

A production decline analysis was performed for a hydraulically fractured well in a tight-gas reservoir in WA to evaluate the decline trend and estimate the constants b and Di. For this purpose, a qD versus time plot was used, resulting in a straight line that has a slope of b, as shown in Figure 10. The b value was estimated to equal 4.79 then, using the trial and error approach of trying different Di values on Figure 11, the value of Di equalling five was provided. With noisy field data and high uncertainties with curve fitting, the traditional approach of trial and error for estimating optimum values of b and Di could be very time consuming. With successful use of the rate derivative method, however, it

Figure 4. Partial hyperbolic-exponential for permeability.

4APPEA Journal 2012

Figure 5. Partial hyperbolic-exponential for skin.

SECOND PROOFMAHADIK 27 MAR 12

Production decline analysis and forecasting in tight-gas reservoirs The general effect of skin on the decline constants was: 1. the initial decline constant decreases with an increase in S; and, 2. the hyperbolic decline exponent increases with an increase in S. The general effect of hydraulic fracture on the decline constants was: 1. the initial decline constant increases with an increase in hydraulic fracture half-length; and, 2. the hyperbolic decline exponent decreases with an increase in hydraulic fracture half-length. q D t D i b k S Xf qD Hyp. Dimensionless rate Time in days Initial decline constant Hyperbolic decline exponent Permeability Skin Hydraulic fracture half-length Derivative of production rate Hyperbolic

ACKNOwLEDGMENTS
The authors wish to acknowledge the technical support of Aurora Oil and Gas Limited, and give special thanks to Ian Lusted, Malcolm Bult, and Philip Trajanovich for their valuable technical advice and support regarding this study. The authors would also like to thank KAPPA Engineering for their generous support by providing free licenses for their software to Curtin Universitys Petroleum Engineering Department.

NOMENCLATuRE
q i q t Initial flow rate Flow rate at time t

Figure 7. Effect of permeability on decline constants.

Figure 8. Effect of skin on decline constants.

Figure 6. Partial hyperbolic-exponential for hydraulic fracture half-length.

Figure 9. Effect of hydraulic fracture half-length on decline constants.

APPEA Journal 20125

SECOND PROOFMAHADIK 27 MAR 12

M.K. Mahadik , H. Bahrami, M. Hossain and P.A. Tsar Mitchel BHP R2 Bottomhole pressure A statistical term to describe the proportion of variability in a data set that is accounted for by a statistical model, and shows how good one term is at predicting another. A higher value of R2 (0 < R2 < 1) means the predictions made by the statistical model have low uncertainties.

REFERENCES
AHMED, T., 2000Reservoir Engineering Handbook, 2nd edition. Oxford: Gulf Professional Publishing. ARPS, J.J., 1945Analysis of Decline Curves. Trans. AIME, vol. 160, 22847. BAILEY, W., 1982Optimized hyperbolic decline curve analysis of gas wells. In: Oil & Gas Journal, 80 (7), 1168. GASKARI, R., MOHAGHEGH, S.D., AND JALALI, J., 2006An Integrated Technique for Production Data Analysis with Application to Mature Fields. SPE Gas Technology Symposium, Calgary, Alberta (Canada), 1517 May, SPE 100562. GENTRY, R.W., AND MCCRAY, A.W., 1978The effect of reservoir and fluid properties on production decline curves. In: Journal of Petroleum Technology, 30 (9), 132741. KUPCHENKO, C.L., GAULT, B.W. AND MATTAR, L., 2008 Tight Gas Production Performance Using Decline Curve. CIPC/ SPE Gas Technology Symposium, Joint Conference, Calgary, Alberta (Canada), 1619 June, SPE 114991.

Figure 10. Rate derivative (case study).

Lee, J. and Wattenbarger, R.A., 1996Gas Reservoir Engineering. Allen, Texas: SPE. RUSHING, J.A., PEREGO, A.D., NEWSHAM, K.E., COMISKY, J.T. AND BLASINGAME T.A., 2007Beyond Decline Curves: LifeCycle Reserves Appraisal Using an Integrated Work-Flow Process for Tight Gas Sands. SPE Annual Technical Conference and Exhibition, Anaheim, California, 1114 November, SPE 109836. RYDER SCOTT COMPANY PETROLEUM CONSULTANTS, 2011Promising DCA techniques emerge as widespread public debate focuses on shale gas forecasts. In: Reservoir Solutions, 14 (3), 18.

Figure 11. Actual and hyperbolic production profile (case study).

Figure 12. Early time hyperbolic and late time exponential fit on the field data.
6APPEA Journal 2012

SECOND PROOFMAHADIK 27 MAR 12

Production decline analysis and forecasting in tight-gas reservoirs

THE AUTHORS
Mujeeb Khan Mahadik is a petroleum engineering graduate from Curtin University (Perth). Prior to this, he had completed a bachelors degree in mechanical engineering from Curtin University (Sarawak, Malaysia). M.Mahadik@postgrad.curtin.edu.au Hassan Bahrami is a PhD candidate in the Department of Petroleum Engineering at Curtin University (Perth). At present he has focused on tight-gas sand reservoirs damage and productivity. Prior to his study at Curtin University, he worked for Schlumbergers data and consulting services (DCS) as a borehole reservoir engineer (200309) and for Tehran Energy Consultants as a reservoir engineer (200103). Hassan holds a B.Sc in Chemical Engineering from Persian Gulf University, and a M.Sc in Reservoir Engineering from the Sharif University of Technology (Tehran, Iran). Hassan.Bahrami@postgrad.curtin.edu.au Tsar Mitchel is presently studying for a Masters degree in Petroleum Engineering from Curtin University. He briefly worked for the Kenya Electricity Generating Company Ltd. as an exploration geophysicist before joining the National Oil Corpoation of Kenya as a petroleum geophysicist. Prior to this, he had studied for a Bachelors degree in Geophysics from Moi University (Kenya). M.Tsar@postgrad.curtin.edu.au

Dr Mofazzal Hossain is a senior lecturer, postgraduate course coordinator, and SPE faculty advisor at the Department of Petroleum Engineering in Curtin University. He has more than 14 years of experience in teaching, research and consulting work with a major focus in the areas related to well technology and petroleum production technology. He has worked with the University of Adelaide and UNSW, Saudi Aramco and King Saud University (Saudi Arabia), and the Reservoir Engineering Research Institute (Palo Alto). His research works encompass reservoir stimulation by hydraulic fracturing for improved production from unconventional tight/shale gas reservoir, completion optimisation, rock fracture mechanics and wellbore stability. Dr Hossain received his PhD in Petroleum Engineering from UNSW. Member: SPE and IEA. Md.hossain@curtin.edu.au

SECOND PROOFMAHADIK 27 MAR 12

APPEA Journal 20127

M.K. Mahadik , H. Bahrami, M. Hossain and P.A. Tsar Mitchel

THIS PAGE LEFT BLANK INTENTIONALLY.

8APPEA Journal 2012

SECOND PROOFMAHADIK 27 MAR 12