Integration of

Geomodelling, Flow Simulation,

COURSE #01 TITLE: Economics & Uncertainty
in Field Development Planning
Course Designer & Lecturer:
Jean-Marie Questiaux

Intensive 5-Day Course

281 Pages of Notes

424 Presentation Slides

50% Spent on Teaching

50% Spent on Tutorial
Course #01 Content TUTORIAL (50% of Course)

Build
Static Model

Flow
Simulation

Simulator
Output

FDP &
Optimization

Cashflow
Modelling

FID & Value Creation

3
 Course #01 - Overview of Course & Tutorial
This geoengineering course aims to give Geoscientists a greater insight into flow behaviour and dynamic simulation and to build static geomodels that better
replicate the true flow behaviour of wells and fields, while giving Reservoir Engineers a better understanding of the complexity of reservoir geology, particularly
the large number of parameters and the difficulty of capturing the key heterogeneities that affect flow behaviour. The range of scales affecting flow behaviour is
wide, from microscopic pore space geometry, mineralogy and clay content (Vshale), Reservoir properties (Porosity, Kh, Kv, Sw) to depositional environments,
reservoir architecture, trapping mechanism, field geometry and faults all of which must be captured into a geologically coherent gridblock system that replicates
accurately the geology and the flow behaviour at each well and the field as a whole.

Reserves and Resource definitions as well as Project Economics, Economic definitions and Cashflow modelling are extensively covered as are the economic
screening metrics and benchmark of different projects.

The course emphasises how static and dynamic models can best be used in Field Development Planning to maximize recovery and reserves, ascertain and
quantify uncertainties and how to address these. The course emphasizes how the judicious usage of static and dynamic models can optimize well numbers
and their placement, lowering investment and operating costs while maintain best industry practises. All this with the ultimate objective of value creation to the
benefit of all stakeholders.

The course is split into teaching classes in the morning complemented by tutorials in the afternoon where students will apply what they have learned to
generate a Field Development Plan from static and dynamic models that they will build themselves. Using these models, the students will assess the field’s
reserves, economics and identify key uncertainties and explain how these uncertainties will be addressed in their development proposal. Students will be split
into teams for the tutorial, each team allocated half an hour on the last afternoon of the course to present their results and conclusions using a maximum of 20
slides to state their case and justifications for the development.

Detailed instructions and guidance are given for the tutorial.

4
Course #01 - Learning Objectives
1. Understand the main reasons and objectives of geomodelling & dynamic simulation.
2. Understand the workflow and each step in constructing a geomodel.
3. Introductory geostatistics and its application in constructing geomodels.
4. Data analysis and data integration in geomodelling workflow.
5. In Place Resource Estimates
6. Uncertainties in geomodelling.
7. Reservoir Engineering fundamentals
8. Drive mechanisms and their impact on well placements
9. Flow Performance, Productivity Index
10. Introductory Well Testing & Material Balance
11. Basics of flow Simulation and interface with Geomodelling
12. Artificial Lift
13. Flow simulation outputs
14. Using flow simulation results to assess reserves and uncertainties
15. Reserves and Resources definition and how they are estimated
16. Basic Economics, and Economic Metrics for assessing projects
17. Run a cashflow simulation
18. Generate Field Development Plan (FDP) by constructing static and dynamic models of a field, determine its
development strategy (wells, facilities etc), its reserves and run full economics.
19. Assess the technical and economic merit/ risks of this Field Development and rank them.
20. Defend the merits of their proposed Field Development Plan before Peers

5
 Introduction to All Courses (#01, #02, #03 and #04)
Since the 1990’s commercial computer based geomodellers and dynamic simulators have become widely available in the industry with an increasing suite of evermore
powerful analytical, geostatistical and visualisation tools to help in their construction and analyse their output results. The ambition of this course is for students to understand
the fundamentals behind static and dynamic modelling; the workflow in constructing these and how to use the results or outcomes intelligently and effectively, which in the
case of this course, is in its application to Field Development Planning.
The course is not intended as a training in the use of static or dynamic packages, any more than a course in creative writing aims to teach students how to use a word
processor.
Model outcomes are first and foremost used as a predictive tool to establish reliable production profiles & reserves which are then used to determine costs, income, Net
Present Value (NPV) and ultimately to make important Financial Investment Decisions (FID) with a high degree of confidence on such major capital investment projects as
Field Development Plans (FDP’s).
The following rules govern the successful construction and use of static & dynamic models:
1) Models must be geologically coherent (structural framework, sedimentology, reservoir distribution & architecture, reservoir characteristics (Phi, Vshale, Sw, Kh, Kv etc.)
and reproduce the observed dynamic behaviour (production rates of Oil, Gas & Water) reservoir pressure behaviour etc. as from well tests or analogues.
2) In the case of producing fields, the models should accurately reproduce the production history of the various wells and the field.
3) Identify and capture the key Heterogeneities affecting flow behaviour in models.
4) Where production history exists, the better the model replicates past dynamic behaviour, the more confidence in its predictions for the future.
5) Grid size must be linked to the degree of detail required to effectively capture the reservoir characteristics that affect dynamic behaviour.
6) The simplest grid is one cell as in Material Balance (Section 17.8) but it requires minimum production history (typically at least 5% of reserves). Although useful for
predicting ultimate recoveries, Material Balance cannot make forecasts on individual well or field production profiles. Modelling does that.
7) Models are invaluable in assessing and quantifying uncertainties that impact productivity, recovery and reserves. The possibility of generating and testing “what if”
scenarios is endless, limited only by the imagination and insight of the Geoscientists and Reservoir Engineers.
8) Upscaling of models through averaging always degrades static models. Therefore, avoid excessively fine-gridded geological models, which subsequently need to be
upscaled to a manageable grid size before flow simulation.
Very significant volumes of additional and/or bypassed oil have been identified and successfully produced on the basis of work based on models. Geomodelling or dynamic
simulators never stifled geological or reservoir engineering creativity, insight or imagination anymore then calculators did to engineering and technological innovation. On the
contrary.
The visualization power (graphs and maps) of geomodelling and dynamic simulation tools is one of their greatest assets in analysing output results.
Geomodelling has now moved largely into the fields of exploration and appraisal where prospects and leads are not only easy and simple to build, but can be analysed and
examined from any angle, sliced and diced to help identify geological incoherencies, weaknesses and risks. We can modify geometries and parameters (velocity models, shift
or add faults, shift fluid contacts, modify reservoir properties etc.) with just a few clicks of a mouse and compute/ quantify the impact of each of these changes.
Modelling offers enormous power to the imaginative Geoscientist and Reservoir Engineer.

6
Course #01 - TUTORIAL (50% Course Time)

7
COURSE #02 TITLE: Geomodelling Workflow
Course Designer & Lecturer:
Jean-Marie Questiaux

3-Day Course

163 Pages of Notes

259 Presentation Slides

50% Spent on Teaching

50% Spent on Tutorial
(Modified from Petrel 2003)

Course #02 is a Module

Extracted from Course #01
Course #02 Content

TUTORIAL (50% of Course)

Static
Model

BASIC
Flow
Simulation

BASIC
Simulator
Output

9
 Course #02 - Overview of Course & Tutorial
This course aims to give Geoscientists a greater insight into building static geomodels that best replicate the true flow behaviour of
wells and fields, while giving Reservoir Engineers a better understanding of the complexity of reservoir geology, particularly the
difficulty of capturing in a geomodel all the key heterogeneities that affect flow behaviour.
The range of scales affecting flow behaviour is wide, from microscopic pore space geometry, mineralogy and clay content (Vshale),
Reservoir properties (Porosity, Kh, Kv, Sw) to depositional environments, reservoir architecture, trapping mechanism, field geometry
and faults all of which must be captured into a geologically coherent gridblock system that replicates accurately the geology and flow
behaviour at each well and the field as a whole.
The students will be taught basic flow simulation so that they can generate outputs to verify that their static models indeed replicate the
true flow behaviour at the wells
The course is split into teaching classes in the morning complemented by tutorials in the afternoon where students will apply what they
have learned to construct a Geomodel that they will be able to test in a flow simulator
Students will be expected to compute In Place and Recoverable Resources from their Static and Dynamic Models
Students will be split into teams for the tutorial, each team allocated half an hour on the last afternoon of the course to present their
results and conclusions using a maximum of 20 slides to present their work, results and conclusions from their Tutorial study.
Detailed instructions and guidance are given for the tutorial.

10
 Course #02 - Learning Objectives
1. Understand the main reasons and objectives of geomodelling & dynamic simulation.
2. Introductory geostatistics and its application in constructing geomodels.
3. Data analysis and data integration in geomodelling workflow.
4. Understand and apply the workflow and each step in constructing a geomodel.
5. Resource Estimates
6. Uncertainties in geomodelling.
7. Basics of flow Simulation and interface with Geomodelling
8. Flow simulation outputs
9. Using flow simulation results to assess reserves and uncertainties
10. Defend the merits of their Static Model before Peers

11
Course #02 - TUTORIAL (50% Course Time)

Static Modelling
Build Static Model and Populate with Properties
Compute in Place Resources from Model

BASIC - Flow Simulation

Basic Flow Simulation (given Res. Eng. Parameters & Wells)
Verify Flow Behaviour of Wells/ Field

BASIC – Simulator Output

Generate Key Dynamic Simulator Outputs & Graphs
Estimate Recoverable resources

12
COURSE #03 TITLE: Practical Reservoir Engineering
& Flow Simulation
Course Designer & Lecturer:
Jean-Marie Questiaux

3-Day Course

122 Pages of Notes

171 Presentation Slides

50% Spent on Teaching

50% Spent on Tutorial

Course #03 is a Module

Extracted from Course #01
Course #03 Content
TUTORIAL (50% of Course)

GIVEN
Static Model

Flow
Simulation

Simulator
Output

BASIC
Cashflow
Modelling

14
 Course #03 - Overview of Course & Tutorial
This course aims to give Geoscientists a greater insight into some fundamentals of Reservoir Engineering and flow behaviour and how this can be modelled using
Dynamic Simulators, whose primary input are static geomodels. This will give better insight in the importance of capturing relevant key heterogeneities in static
models to best replicate the true flow behaviour of wells and fields.

Focus is on fluid and rock properties; Drive mechanisms and their impact on productivity, recovery and ultimately Reserves.

Some basics fundamentals of Well Testing are also covered, in order to give the whole picture around fluid movements in porous and permeable reservoirs, how
these are analysed and what information can be gained from such tests.

The various available Dynamic simulators are also reviewed.

Reserves and Resource definitions and computation is covered, as are project economics and screening metrics, the reservoir engineer often at the forefront of
reserves and economic assessment on the basis of his dynamic modelling results.

The course emphasises of determining key uncertainties, how to quantify and address these. Optimization of well numbers and their placement, lowering
investment and operating costs while maintain best industry practises is stressed during the Tutorial exercise. All this with the ultimate objective of value creation
to the benefit of all stakeholders.

The course is split into teaching classes in the morning complemented by tutorials in the afternoon where students will have to apply what they have learned from
the teaching. They will be provided with a static model and will have to place a series of development and injection wells and assess the optimum development
scenario; the field’s reserves and identify key uncertainties.

Students will be split into teams for the tutorial, each team allocated half an hour on the last afternoon of the course to present their results and conclusions using
a maximum of 20 slides to show their work, results and conclusions.

Detailed instructions and guidance are given for the tutorial.

15
 Course #03 - Learning Objectives
1. Understand the main reasons and objectives of geomodelling & dynamic simulation.
2. Uncertainties in static and flow modelling.
3. Reservoir Engineering Fundamentals
4. Rock and Fluid properties
5. The different dynamic simulation models
6. Drive mechanisms and their impact on well placements
7. Flow Performance, Productivity Index
8. Introductory Well Testing & Material Balance
9. Artificial Lift
10. Flow simulation outputs
11. Using flow simulation results to assess Recoverable Resources and uncertainties
12. Resources definition and how they are estimated
13. Basic Economics, and Economic Metrics for assessing projects
14. Defend the merits of their proposed Field Development Plan, as determined in their Tutorial exercise before
their Peers

16
 Course #03 - TUTORIAL (50% Course Time)

GIVEN - Static Modelling

A Static Model will be provided

Flow Simulation
Enter Reservoir Engineering Parameters
Dynamically Simulate in FRONTSIMS
Compare Productivity between Vertical versus Horizontal Wells

Simulator Output
Generate Key Dynamic Simulator Outputs in Tables and Graphs

BASIC - Field Development

Propose simple FDP (Maximize Recovery/ Reserves & Minimizes Costs
(# of Wells, Optimal Placements, Reservoir Support (Injection), etc.)
 Resources
Resources
Resources & & &
COURSE #04 TITLE: Reserves Reserves
Reserves Definition
Definition
Definition
Their Assessment;
Course Designer & Lecturer:
Their
Their Assessment;
Assessment;
Jean-Marie Questiaux Project
Project Project Economics
Economics
Economics & & &
Screening
Screening
Screening
3-Day Course
Strong Emphasis on Tutorial
(Cashflow Simulation)

74 Pages of Notes
106 Presentation Slides

35% Spent on Teaching

65% Spent on Tutorial

Course #04 is a Module

Extracted from Course #01
Course #04 Content

Simulator
Output

FDP &
Optimization

Cashflow
Modelling

FID & Value Creation

20
 Course #04 - Overview of Course & Tutorial
This course is aimed at Geoscientists and Reservoir Engineers that need to understand the definitions of what constitutes Resources
and Reserves and what differentiates them.

The course begins with a detailed overview of world resources/reserves and production trends. This is followed by a review of the
definitions of Contingent and Prospective Resources and how and why these are differentiated from Reserves

This is followed by Resource and reserves Computation, starting with a review of key computing parameters, in particular Net-Pay cut-
offs and fluid contacts. Deterministic and Probabilistic approaches to resource and reserves computations are explained, including the
use of dynamic models’ outputs to do this.

Next is an overview of world petroleum economics, before a detailed review of economic definitions, followed by Project Economics
(Cashflow modelling) and Economic metrics to screen the viability of projects and benchmark projects.

The teaching classes are complemented by a tutorial where students will carry out a cashflow simulation on a Field development Plan
(FDP) and assess its economic viability on various metrics

Detailed instructions and guidance are given for the tutorial.

21
Course #04 - Learning Objectives
1. Understanding of present-day World Reserves and Production trends
2. Reserves and Resources Definitions
3. Reserves and Resources Computation
4. Understanding of present-day World Petroleum economic trends
5. Economic Metrics for assessing projects
6. Cashflow simulation for a Field Development Plan (FDP)
7. Assess the economic merit/ risks of this Field Development and rank them.
8. Defend the merits of their proposed Field Development Plan before Peers

22
Course #04 - TUTORIAL (50% Course Time)

Simulator Output
Students given varying Well Type profiles for Producers
Determine a FDP that best applies to given Resources
This includes Facilities, Wells and Oil export

Field Development Plan

Propose FDP to maximize Reserves and minimize Costs
i.e. Determine Number of Production and Injector Wells
Compute CAPEX, OPEX & ABEX and Gross Income

Cashflow Modelling
Compute Gross: Costs, Income, Royalties and Taxes
Run full Cashflow Simulation
Determine: NPV

FID & Value Creation

Besides NPV, compute Key Economic Metrics (IRR, ROI etc.)
Use Key Economic Metrics to decide on Project Sanction

23
 References 1 of 2 - All Courses (#01, #02, #03 & #04)
1. AAPG Studies in Geology No. 50, Chapter 18 (1998): The Geometry, Architecture, and Sedimentology of Fluvial and Deltaic Sandstones Within the Upper Ferron Sandstone Last
Chance Delta: Implications for Reservoir Modeling by: T. C. V. van den Bergh1,2 and James R. Garrison, Jr.1,3
2. Abdallah et al. (2007). Fundamentals of Wettability. Oilfied Review, 19(2), 44-61. Retrieved from
https://www.slb.com/~/media/Files/resources/oilfield_review/ors07/sum07/p44_61.pdf
3. Amaefule, J.O., Altunbay, M., Tiab, D., Kersey, D.G., and Keelan, D.K. (1993), Enhanced reservoir description: using core and log data to identify hydraulic (flow) units and
predict permeability in uncored intervals/wells. SPE paper 26436, 205-220
4. Berg, R.R. (1970), Method for Determining Permeability From Reservoir Rock Properties. Trans., Gulf Coast Association of Geological Societies 20: 303-335
5. Berman A, The oil price collapse is because of expensive tight oil (2015) http://www.artberman.com/the-oil-price-collapse-is-because-of-expensive-tight-oil/
6. BP Statistical Review of World Energy (2018), British Petroleum PLC
7. Busch D. a. et al (1985). Exploration Methods of Sandstone Reservoirs. OGCI Publication
8. Caers J. (2005), Petroleum Geostatistics, SPE
9. Chang, Yih-Bor, Coats, B.K. and Nolen, J.S., (1998) A Compositional Model for CO2 Floods Including CO2 Solubility in Water, SPE RE&E, April, 155-160
10. Chidsey, T. C., Adams, RR. D., Morris T. H. (2004), Regional to wellbore analog for fluvial-deltaic reservoir modelling: The Ferron Sandstone of Utah. AAPG Studies in Geology,
No 50 - 2004
11. Cobb, W.M. and Marek, F.J.: “Net Pay Determination for Primary and Waterflood Depletion Mechanisms,” SPE 48952 presented at the 1998 SPE Annual Technical Conference
and Exhibition, New Orleans, Sept. 27-30 -1998
12. Consentino, L. Integrated Reservoir Studies Editions TECHNIP (2001)
13. Cowan G., et al., The use of dipmeter logs in the structural interpretation and palaeocurrent analysis of Morecambe Fields, East Irish Sea Basin. In: J.R. Parker, ed., Petroleum
Geology of Northwest Europe: Proceedings of the 4th Conference, The Geological Society, London, p. 867-882 - 1993
14. Deutsch C., Geostatistical Reservoir Modeling. Oxford University Press - 2002
15. Dubrule, O., Geostatistics in Petroleum Geology. AAPG - Continuing Education Course Note Series # 38 - 1998
16. Glover, P, Relative Permeability. Formation Evaluation MSc Course Notes Chapter 10. Leeds University
17. Harrison, P.F. (1994), Wytch Farm: Horizontal well application. Paper presented at 3rd Horizontal well technical forum, 18-19 August, Heriot-Watt University
18. Hatton, I.R. et al, 1992. Techniques and applications of petrophysical correlation in submarine fan environments, early Tertiary sequence, North Sea. In: Geological Applications
of Wireline Logs II (A. Hurst, C.M Griffiths & P.F. Worthington, eds.) Geological Society, London, Special Publication, 15.1, 21- 30 - 1992
19. Hook, M., Soderbergh, B., Jakobsson, K. & Aleklett, K.”The evolution of giant oil field production behaviour”Natural Resources Research, 2009, Vol. 18, Issue 1: 39-56 URL:
http://dx.doi.org/10.1007/s11053-009-9087-zA
20. Hook M., Robert Hirsch R., Aleklett K., 2009, Giant oil field decline rates and their influence on world oil production. Published in Energy Policy, Volume 37, Issue 6, June 2009,
Pages 2262-2272. http://dx.doi.org/10.1016/j.enpol.2009.02.020
21. Horne R. N, 1995, Modern Well Test Analysis, Second Edition (2000). Petroway Inc
22. Frank J., Cook M. & Graham M. – Hydrocarbon Exploration and Production Elsevier (2001)
23. J-Leverett Function. http://web.mst.edu/~numbere/cp/chapter%203.htm#_Toc506795466
24. Jahn F., Cook M., Graham M., (1998) Hydrocarbon Exploration and Production. Developments in Petroleum Science – 46 - Elsevier
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 References 2 of 2 - All Courses (#01, #02, #03 & #04)
25. Kossack, C.A., Kleppe, J. and Aasen T., Oil Production From the Troll Field: A Comparison of Horizontal and Vertical Wells, SPE 1987 (SPE-16869)
26. Lawrence D.A., 2002, Net sand analysis in thinly bedded turbidite reservoirs - case study integrating acoustic images, dipmeters and core data. Paper HH, SPWLA 43rd Annual
Logging Symposium, June 2-5, 14 pp
27. Lerner A., (2015) Of Giants, Super-Giants, And Mega-Giants (2015). https://seekingalpha.com/article/3124106-of-giants-super-giants-and-mega-giants
28. Lindsay, N. G., F. C. Murphy, J. J. Walsh, and J. Watterson, 1993, Outcrop studies of shale smear on fault surfaces: International Association of Sedimentologists Special
Publication 15, p. 113-123
29. Merrill R. K. and Sternbach C. A. (2017), AAPG Century – Giant Fields through the Decades - Search and Discovery Article #70267 (2017)
http://www.searchanddiscovery.com/pdfz/documents/2017/70267merrill/ndx_merrill.pdf.html
30. Nelson P.H, 2004, Rock Evolution on the Permeability-Porosity Plane: Data Sets and Models. AAPG Hedberg Conference, Austin, 8-11 February 2004.
31. Nelson P.H, 1994, Permeability-Porosity Relationships in Sedimentary Rocks, Log Analyst, p38-64
32. Reading H.G (editor), 1978. Sedimentary Environments and Facies, Second Edition (1986). Blackwell Scientific Publications
33. Ringrose P, Skjetne E, Elfeinbein C (2003) Permeability estimation functions based on forward modeling of sedimentary heterogeneity. SPE 84275, presented at the SPE annual
conference, Denver, CO, USA, 5–8 Oct 2003
34. Ringrose, 2001. Geological Reservoir Modelling Course, Statoil visiting lecturer At Heriot Watt University
35. Robelius, F., (2007); Giant Oil Fields - The Highway to Oil: Giant Oil Fields and their Importance for Future Oil Production. Doctoral thesis from Uppsala University
36. Saudi Arabian Oil Company - Global Medium Term Note Programme. Saudi Arabian Oil Company. April 1, 2019
https://www.rns-pdf.londonstockexchange.com/rns/6727U_1-2019-4-1.pdf
37. Schlumberger: https://www.slb.com/-/media/Files/resources/oilfield_review/defining_series/ Defining-Reservoir-Drive-echanisms.pdf?la=en&hash=9A39F323DB3044F91EC00
A148A018EB1484FA6AF
38. Scholle P.A et al, 1982, Sandstone Depositional Environments. AAPG, Memoir 31
39. Selley R. C., 1985, Elements of Petroleum Geology, Academic Press (Second Edition, 1998),
40. Selley R. C., 1988 Applied Sedimentology, Academic Press
41. Serra O., 1985, Sedimentary Environments from wireline logs, Schlumberger Publication
42. Skjaeveland S.M, Siqveland L.M, Kjosavik A, Hammervold W.L, Virnovsky G.A, Capillary Pressure Correlation for Mixed-Wet Reservoirs. Society of Petroleum Engineers, 1998
(SPE 39497)
43. Snyder, R.H.:”A Review of the Concepts and Methodology of Determining ‘Net Pay’,” SPE 3609 presented at the 1971 SPE Annual Meeting, New Orleans
44. Smithson T, Reservoir Drive Mechanisms, Oilfield Review (2016).
45. SPE/WPC Reserves Definitions Approved JPT (May 1997) 527.
46. Speers R et al, 1992. Managing Uncertainty in Oilfield Reserves. Schlumberger Middle East Well Evaluation Review, vol 12
47. Vavra, C.L., Kaldi, J.G., and Sneider, R.M.: “Geological Applications of Capillary Pressure: A Review,” AAPG Bulletin (June 1992) 76, No. 6, 840- 50
48. Wagoner J.C. et al, 1990, Siliciclastic Sequence Stratigraphy in Well Logs, Cores and Outcrops. AAPG Methods in Exploration Series, No 7
49. World Energy Investment 2017, International Energy Agency (US) 2017

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Course Designer
& Lecturer

27
Lecturer
Lecturer