Heriot -Watt University

Heriot-Watt
DEPARTMENT OF PETROLEUM ENGINEERING

Introduction to Reservoir Engineering

Adrian C Todd
History of Reservoir Engineering

z Traced to mid 1930’s

z 1994 Dake in ‘Practise of Reservoir Engineering.’
– ‘Reservoir Enginering shares the distinction with geology in
being one of the ‘underground sciences’ of the oil industry,
attempting to describe what occurs in the wide open spaces
of the reservoir between the sparse points of observation -
the wells’
Integration of Reservoir Engineering
Roles of the Reservoir Engineer

z Contributing with geologists and

petrophysicists in estimation of oil-in-place
z Determining fraction of oil-in -place that can
be recovered.
z Attach a time scale to the recovery.
z Day-to-day operational reservoir engineering
throughout the project lifetime.
Activities of Reservoir Engineering

z Reserve Estimation
z Development Planning
z Production Operations Optimisation
Reserve Estimation

z The reserves are the main assets of an oil

company.
z Quantifying reserves and recovery factor is an
ongoing role of the reservoir engineer.
z Basic data not always straightforward.
z Reserves can be affected by the development
process
 Reserve Estimation

z Geophysical
estimates from
seismic interpretation
Reserve Estimation

z Log Analysis
estimates of porosity
and fluid saturation
 Reserve Estimation

z Laboratory measurements to measure

recoverable oil
Reserve Estimating

z Not exclusive to reservoir engineers

z Volumetric estimates of reserves obtained at
various stages
z STOIIP - stock tank oil initially in place
Optimal Development Planning

z Large up front investment

Optimal Development Planning

z Requires detailed understanding of the

reservoir characteristics
Optimal Development Planning

z Various development options to be

considered
Production Operations Optimisation

z Rarely do reservoirs perform as predicted

z The reservoir engineering model has to be
updated in line with the production behaviour.
 Reservoir Engineering Techniques
z Traditional reservoir engineering tools were designed
around slide rule and graph paper.
z Increasingly advanced computing capability is
enabling large ‘simulations’ to be carried out
Available data

z Geophysical surveys
z Well logs
z penetration
z cuttings
– electrical
– sonic
– nuclear

z Pressure data
z Formation fluid content data
Tools of the Trade

z Seismic maps z Structural maps

z Well logs z Porosity maps
z Sections z Understanding the
geological model
z Pressure
measurements z Imagination.
z Isopach maps
Geological model
Petroleum Reserves Definitions

z Subject of study for some time.

z Agreed definitions by SPE and WPC in 1996.
z Recognises that not practical to have precise
classification because of different forms of
occurrence, wide characteristics, uncertainties
of geological environment, and evolution of
technologies.
Petroleum Reserves Definitions

z Essential that governments and industry have

a clear assessment of quantities available and
anticipated within practical time frame through
additional field development, technological
advances, or exploration.
z Important that a consistent nomenclature be
used by industry to define reserves.
Reserves Definitions

z Reserves are those quantities which are

anticipated to be commercially recovered
from known accumulations from a given
date forward.
z Reserve estimates involve some degree of
uncertainty.
z Uncertainty depends on reliable geological
and engineering data available at the time of
estimate and its interpretation.
Reserve Uncertainty

z Relative uncertainty expressed by placing

reserves into two classifications.

z Proved
z Unproved-less certain than proved.
Further subdived to express increasing
uncertainty.

Î Probable
Î Possible
Methods of Estimation

z Deterministic
– A single best estimate of reserves bases on
known geological, engineering, and economic
data.

z Probabilistic
– Known geological, engineering and economic
data are used to generate a range of
estimates and their associated probabilities.
Proved Reserves

z Those reserves which by analysis of

geological and engineering data , can be
estimated with reasonable accuracy to be
commercially recoverable from a given
date forward from known reservoirs and
under current economic conditions,
operating methods and government
regulations.

z Developed and Undeveloped

Proved Reserves

z Deterministic methods
– reasonable certainty to express a high degree
of confidence that quantities will be
recovered.

z Probabilistic methods
– at least 90% probability that the quantities
actually will equal or exceed the estimate.
Proved Reserves

z Reserves are considered proved if

commercial producibility is supported by
actual production or formation tests.
z In certain cases proved reserves may be
allocated on the basis of well logs and/or core
analysis that indicate that the reservoir is
hydrocarbon bearing and analogous to
reservoirs in the same area that are producing
or have demonstrated the ability to produce
on formation tests.
Proved Reserves

z The area of the reservoir includes:

Î the area delineated by drilling and defined by
contacts, if any.
Î The undrilled portions of the reservoir that
can be reasonably judged as commercially
productive on the basis of available geological
and engineering data.
Î If no fluid contacts, lowest occurrence of
hydrocarbons controls the proved limit unless
indicated by definite geological, engineering
or performance data.
 Test 1

z There are 950 MMstb of oil initially in place in a reservoir.

It is estimated that 500 MMstb can be produced. Already
100MMstb have been produced. What are the reserves?

STOIIP is: 950 500 400 MMstb

The reserves are:

450 400 500 MMstb

 Test 1

z There are 950 MMstb of oil initially in place in a reservoir.

It is estimated that 500 MMstb can be produced. Already
100MMstb have been produced. What are the reserves?

STOIIP is: 950 √ 500 x 400 x MMstb

The reserves are:

450 x 400 √ 500 x MMstb

Test 3

z What is wrong with the following statement ?

– Reserves are those quantities which are
anticipated to be recovered from a petroleum
accumulation
Test 3

z What is wrong with the following statement ?

– Reserves are those quantities which are
anticipated to be recovered from a petroleum
accumulation

z Answer
– Reserves are those quantities which are
anticipated to be commercially recovered.
Economics is very important aspect
 Economics
z Oil and gas price ?
z Inflation?
z Future economic trends?
z Discount factors etc?
z Answer-
z The current economic conditions are the basis re;-
prices
– costs
– contracts
– government regulations
 Test 4.
z We have a structure in an area which we expect to
explore. We anticipate it to contain a STOIIP of
2000MMstb, and a recovery factor of 65% using
primary recovery (30%), secondary (25%) and
tertiary (10%) recovery methods. What are the
reserves?
z Answer:SPE/WPC - zero. Intentions are not a
basis for reserves. No well has yet been drilled.
z Some companies will allocate potential reserves for
internal use. Cannot be used for public or
government figures.
Requirements for proved reserves
z Maps
– from seismic and geological data.

z Petrophysical logs
z Well test results and rock properties from
recovered core.
z Facilities
– Necessary facilities for processing and
transport either in place or will be installed as
backed up by formal contract
Contributions to the Proved Reservoir Area

z This comes from the drilled and produced

hydrocarbons
z the definition of the gas and oil and water
contacts
z or the highest and lowest observed level of
hydrocarbons.
z Also the undrilled area adjacent to the drilled
can be used.
Reserves - progression with time
Probabilistic Representation of Reserves

z In the deterministic approach volumes are

determined by calculation of values
determined for the various parameters.

z With the probabilistic approach statistical

analysis is used. e.g. Monte Carlo methods
Probabilistic Representation of Reserves
z Proven - 90% probability
z Probable - difference
between 50 & 90%
z Possible - difference between
10 & 50%
 Probabilistic Representation of Reserves
z Some measure of subjectivity. For each element there is a
probability function.
Probabilistic Representation of Reserves

z Proven = 500MMstb,
z Probable =740-500=240MMstb
z Possible =860-740=120MMstb
Probabilistic Representation of Reserves
z As field is produced the shape of the curve changes.
Probability converted to recovery leaving less uncertainty in
reserves.
Volume in-place calculations
z Volume of oil and gas in-place, V, depends on:
Ê aerial coverage of reservoir , A.
Ê Thickness of the reservoir, hn.
Ê Pore volume, expressed by porosity,φ.
Ê Proportion of pore space occupied by hydrocarbon, (
the saturation ), 1-Sw

V=Ah nφ (1 − Sw )
When expressed as stock tank volumes
equation divided by Bo or Bg

V=Ah nφ (1 − Sw ) / Bo
Volume in-place calculations & Reserves
STOIIP=V=Ah nφ (1 − Sw ) / Bo

Reserves = STOIIP × R F x

Where RF is the recovery factor

A - will vary according to category:

proven
probable
possible
 Evolution of the reserve estimate

Suggest this location

Evolution of the reserve estimate
Evolution of the reserve estimate

Proved
Probable Probable
Possible Possible
Evolution of the reserve estimate
Evolution of the reserve estimate
Evolution of the reserve estimate
 Evolution of the reserve estimate
Deterministic perspective as indicated by top structure map
Formation Volume Factors Oil,Bo and Gas, Bg
z Formation volume factors convert reservoir
volumes to surface volumes.
z They do not vary significantly across the
reservoir compared to other rock related
properties.
z In some reservoirs there is a compositional
gradient which results in variations in the oil
formation volume factor
z In this case average or values measured at
depth would be preferred
 Recovery Factor
z Proportion of hydrocarbons recovered called
recovery factor.
z Influenced by a range of properties.
z Rock and fluid properties.
z Drive mechanisms.
z Formation characteristics & heterogeneity
z Development process
z Geometry and location of wells
Other Appraisal Tool - Production Test

z One of the moat powerful tools for reservoir

engineer.
z Used to evaluate the characteristics of the
reservoir under realistic conditions.
z Exploration well is turned temporally into a
producing well and downhole pressure
recorded.
 Production test - Well Test

Key aspects >

Producing interval

Downhole pressure
monitoring
Lines

Oil & Gas Flowrates

 Well Test
2 rate test
Initial downhole
pressure
Pressure declines
in relation to flow 1

Pressure declines
in relation to increased
flow 2

Well shut in
and pressure
builds up
Draw down and
build up curves
analysed to give kh
 Other Appraisal Tools

z Nature of the Fluids - PVT

Ë important for reservoir behaviour and processing.

z Pressure profile in a well.

Ë powerful measurements to aid in reservoir structure
and dynamic continuity.

z Core analysis
Ë a cross check for downhole measurements and
unique measurements.
 Development Planning
z An evaluation of alternative plans
z Well data and Test Results
z Reservoir maps
z Material Balance
z Drive mechanisms
z Reservoir models
z Techno economics
Ë Land developments higher degree of flexibility
Ë Offshore developments limited flexibility after production system
ordered
Reservoir maps
An evaluation of alternative plans
 Development Planning

z Drive mechanisms
z Simple and complex models
z Displacement models for injection processes
z Recently, integration of geological and
geophysical perspectives providing greater
confidence in simulation models
 Drive mechanisms

Water Drive Gas Drive

1 1
1

2
2

3
3
Development Planning

z Production profiles
Î oil, gas and water

z Well requirements
z Topside facilities
 Uncertainty
z Reducing uncertainty is the key issue of the
decade and not least in reservoir engineering
and its related disciplines.
z More information gives less uncertainty.
z Collecting data costs money
z Greater cost the delay on the project.
z Tension between reservoir engineers and
project engineers.
Uncertainty - Reservoir

z Static properties
Î Reservoir structure
Î Reservoir properties, k, h etc
Î Reservoir connectivity
Î Impact of faults
Î ‘thief’ sands
Uncertainty - Reservoir

z Dynamic properties
Î Relative permeabilities etc.
Î Fluid properties
Î Aquifer behaviour
Î Well productivity ( fractures, well type, condensate
drop-out etc.
Uncertainty - Reservoir
 Material Balance Equation

Pi
Production

Water Influx

Pt
Material Balance Equation
z Examines the pressure -volume behaviour of
an entire field
z Tank model of the reservoiur
z Engineer fits a simple model to the data and
predicts future performance
z Model gets updated to match production -
history matching.
z Reservoir simulation models comprise many
aspects of material balance
 Material Balance Equation
N p ⎡⎣ Bt − Bg ( R si − R p ) ⎤⎦ + Wp = C
⎡B − B ⎛ Bg − Bgi ⎞ Sw c w + c f ⎤
NBti ⎢ t ti
+ m⎜ ⎟ + (1 + m ) ∆p ⎥ + We
⎢⎣ Bti ⎜ Bgi ⎟ 1-Sw ⎥⎦
⎝ ⎠
Known : Production data Np, Rp, Wp
HISTORY MATCHING Hydrocarbon Properties Bt, Bti, Bg, Bgi
Reservoir Properties Sw, cw, cf, m
Pressure drop ∆p
Unknown : Reserves N
Water Influx We

PREDICTION Known : Reserves,Water influx, Hydrocarbon properties,

Reservoir properties.

Unknown : Oil & Gas production as a function of pressure drop

Production Operations Optimisation
z The development phase
Î covers period from continuous production to
abandonment.
Î When to stop a techno-economic decision.
Î Best reservoir engineering data during production
stage.
Î Through production the reservoir yields its secrets.
Î Hydrodynamic continuity revealed by post production
pressure surveys.
Î Rise of fluid contacts needs monitoring
History Matching
z Throughout production the comparison of the actual
performance with that predicted during appraisal
stage is monitored. It is during this stage that the
reservoir simulation model is under examination.

z History Matching. - The update of the model to

fit actual performance.
z Clearly a model that cannot predict the past is no
good for predicting the future!
z Computing power is enabling integration of geological
input with physics of flow etc. - Integrated reservoir
simulation.
Production Operations Optimisation

z Good production records required.

z History Matching
– The update of the model in line with actual
performance

z Reservoir simulation success depends on

detail of reservoir description and complexity
of reservoir.
Reserve Estimating

z When production data available reserves

estimates can be refined.
z Historically
– Decline curve analysis
– Material Balance Equation

z Computer based reservoir simulation

 Decline curve analysis

z Plots of production rate versus time, or

production, on a variety of co-ordinate scales
z Straight line is considered to characterise
behaviour and is extrapolated to predict future
performance.
 Phases of Development
z During development a number of
phases
z the build up phase
– with predrilling may not
happen
z the plateau phase
– the reservoir is producing at
design capacity for the
facilities.
z The decline phase
– the reservoir no longer able
to produce at capacity.
– Plateau phase can be Economic limit - will vary
extended, eg use of artificial according to project type
lift, downhole pumps or gas and size
lift.
 Improving Recovery
Three phases of recovery
z Primary recovery
– recovery obtained through natural energy of the reservoir

z Secondary Recovery
– energy is supplemented by injection of fluids, gas or water.
To maintain or partially maintain pressure.
– Two types of oil left.
– High saturation in unswept part- by passed oil
– Lower saturation in swept part - residual oil saturation

z Enhanced oil recovery, EOR.

– The target for by-passed and residual oil
 Enhanced or Tertiary Recovery
Improved Oil Recovery,
IOR -
covers all approaches to
improve hydrocarbon
recovery
The Uniqueness of the Reservoir

Reservoir Behaviour

Early agreement to
reservoir description
Reservoir Development speeds development
Plan

Unique & Static

Dynamic
Reservoir Description
Leman Gas Field UK after first exploration well
Leman Gas Field UK 10years after first exploration well
 Reservoir Engineering

z A broad fundamental background of basic

sciences and engineering.
z The behaviour of the reservoir rocks.
z The properties of the contained fluids
z Fluid through through reservoir rocks
z Reservoir drive mechanisms
How things have changed !!