Heriot-Watt University

INSTITUTE OF PETROLEUM ENGINEERING

Introduction to Reservoir Engineering

History of Reservoir Engineering

 Traced to mid 1930’s

 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

 Contributing with geologists and

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

 Reserve Estimation
 Development Planning
 Production Operations Optimisation
Reserve Estimation

 The reserves are the main assets of an oil

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

 Geophysical
estimates from
seismic interpretation
Reserve Estimation

 Log Analysis
estimates of porosity
and fluid saturation
 Reserve Estimation

 Laboratory measurements to measure

recoverable oil
Reserve Estimating

 Not exclusive to reservoir engineers

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

 Large up front investment

 Optimal Development Planning

 Requires detailed understanding of the

reservoir characteristics

1mm
Optimal Development Planning

 Various development options to be

considered
Production Operations Optimisation

 Rarely do reservoirs perform as predicted

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

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

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

 Seismic maps  Structural maps

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

 Subject of study for some time.

 Agreed definitions by SPE and WPC in 1996.
 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

 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.
 Important that a consistent nomenclature be
used by industry to define reserves.
Reserves Definitions

 Reserves are those quantities which are

anticipated to be commercially recovered
from known accumulations from a given
date forward.
 Reserve estimates involve some degree of
uncertainty.
 Uncertainty depends on reliable geological
and engineering data available at the time of
estimate and its interpretation.
 Reserves
 Some measure of subjectivity. For each element there is a
probability function.
Reserve Uncertainty

 Relative uncertainty expressed by placing

reserves into two classifications.

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

 Probable
 Possible
Methods of Estimation

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

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

 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.

 Developed and Undeveloped

Proved Reserves

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

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

 Reserves are considered proved if

commercial producibility is supported by
actual production or formation tests.
 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

 The area of the reservoir includes:

 the area delineated by drilling and defined by
contacts, if any.
 The undrilled portions of the reservoir that
can be reasonably judged as commercially
productive on the basis of available geological
and engineering data.
 If no fluid contacts, lowest occurrence of
hydrocarbons controls the proved limit unless
indicated by definite geological, engineering
or performance data.
 Economics
 Oil and gas price ?
 Inflation?
 Future economic trends?
 Discount factors etc?
 Answer-
 The current economic conditions are the
basis re;- prices
– costs
– contracts
– government regulations
Requirements for proved reserves
 Maps
– from seismic and geological data.

 Petrophysical logs
 Well test results and rock properties from
recovered core.
 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

 This comes from the drilled and produced

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

 Reserves from other locations proved under

developed provided where geological and
engineering data from wells indicate objective
formation is laterally continuous and contains
commercially recoverable at locations beyond
direct offset wells.
 Reserves

 Reserves can be attributed to natural energy

or improved recovery methods.
 Improved recovery methods
– all methods for supplementing natural energy
or altering natural forces in the reservoir to
increase ultimate recovery.
– Examples: pressure maintenance, gas
cycling, waterflooding, thermal methods,
chemical flooding, and the use of miscible
and immiscible displacement fluids
Unrecovered oil

 What are the amounts termed which are not

recovered?
 The amount that remains in the reservoir are
called:

 remaining hydrocarbons in place.

 NOT Remaining Reserves !
 Proved reserves

 Reserves produced using established improved

recovery methods when:
 successful results from pilot project or favourable response in the
same or analogous reservoir with similar rock & fluid properties.

 Reasonable certain project will proceed.

 From IOR methods yet to be established provided:

 favourable production response from subject reservoir
 from pilot
 installed programmes with response as planned
 reasonably certain project will proceed
Unproved Reserves

 Based on geological and/or engineering

data similar to proved reserves but
technical, contractual, economic, or
regulatory uncertainties preclude being
classified as proved.
 Further classified as:

 Probable
 Possible
Probabilistic Representation of Reserves

 In the deterministic approach volumes are

determined by calculation of values
determined for the various parameters.

 With the probabilistic approach statistical

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

 Proven = 500MMstb,
 Probable =740-500=240MMstb
 Possible =860-740=120MMstb
Probabilistic Representation of Reserves
 As field is produced the shape of the curve changes.
Probability converted to recovery leaving less uncertainty in
reserves.
 Phases of Development – Production
Profile
 During development a number of
phases
 the build up phase
– with predilling may not
happen
 the plateau phase
– the reservoir is producing at
design capacity for the
facilities.
 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.
 Enhanced or Tertiary Recovery
Improved Oil Recovery,
IOR -
covers all approaches to
improve hydrocarbon
recovery