SPE 84222

A Cost Effective Approach to Modeling and Managing Large Gas Fields

David Yee, SPE, PHH Petroleum Consultants Ltd., Ricot Poitevien, Apache Canada Ltd.

Copyright 2003, Society of Petroleum Engineers Inc.

Medicine Hat zones have very low permeability and produce
This paper was prepared for presentation at the SPE Annual Technical Conference and at low rates while the SWS zone has higher permeability and
Exhibition held in Denver, Colorado, U.S.A., 5 – 8 October 2003.
produces at higher initial rates. Productive Milk River exists
This paper was selected for presentation by an SPE Program Committee following review of
information contained in an abstract submitted by the author(s). Contents of the paper, as over the entire field while the Medicine Hat pay disappears to
presented, have not been reviewed by the Society of Petroleum Engineers and are subject to
correction by the author(s). The material, as presented, does not necessarily reflect any
the east and the productive SWS exists only in the extreme
position of the Society of Petroleum Engineers, its officers, or members. Papers presented at south. While the three zones are still segregated in some wells
SPE meetings are subject to publication review by Editorial Committees of the Society of
Petroleum Engineers. Electronic reproduction, distribution, or storage of any part of this paper it is now common practice to commingle the upper two zones
for commercial purposes without the written consent of the Society of Petroleum Engineers is
prohibited. Permission to reproduce in print is restricted to an abstract of not more than 300
and segregate the SWS. The Milk River-Medicine Hat well
words; illustrations may not be copied. The abstract must contain conspicuous spacing varies from 64.7 to 32.4 ha (160 to 80 acres) while the
acknowledgment of where and by whom the paper was presented. Write Librarian, SPE, P.O.
Box 833836, Richardson, TX 75083-3836, U.S.A., fax 01-972-952-9435. SWS spacing varies from 259 to 64.7 ha (640 to 160 acres).
The main part of the field has been developed under closer
spacing and most of the remaining reserves are in the Milk
Abstract
River zone as the other productive zones have less net pay
thickness and area and had higher initial producing rates.
Management of gas reservoirs can be a difficult task if
In the year 2001 program 200 wells were added and in
there is a varying degree of interference between wells. This
2002, a 600 well infill program was initiated. At the end of
difficulty increases with well count and the number of
October, 2001 there were 1846 wells producing out of a total
compressors and inter-connected processing plants. Numerical
of 2136 wells in the Apache operated area. The surface
simulation of the integrated network and reservoir can help
network in Hatton is very complex with multiple delivery
substantially. However, stability issues in complex networks
points, compressor stations and significant flow splitting.
and extensive data requirements have made simulation costly
There were four sales points and six compressor stations, two
for large and complex projects.
of which were boosters. The maximum rate for the Apache
With an extremely stable and efficient numerical model
wells in this field reached 4000 E3m3/d during the late 1980’s
combined with data preparation techniques that rely on the use
and has since decreased to approximately 1500 E3m3/d.
of existing databases and automated techniques, as well as
The original model for this field was built in 1993 using a
streamlined history matching approaches, it has now become
“pseudo well” model where wells associated with a given
economically viable to use integrated models for large shallow
battery were grouped and averaged into tank reservoirs.
gas properties. Without such a model to predict future
Gathering lines connected these pseudo wells to the
performance, there is significant risk of over-building and
compressors and plants. This model was limited because of
over-drilling for future development. This paper discusses the
the use of tanks to represent reservoirs, where new wells may
setup, calibration and day to day use of an integrated model
start at lower pressures than actual. In addition, pressure drops
for a shallow gas field in Southern Saskatchewan, Canada.
along group lines are not properly accounted for and
uncertainty existed in the calculation of effective diameters for
Background
the pseudo wells.
With improved computer performance and simulation
The Hatton reservoir has three main productive geological
programs it is now practical to model such a system on an
zones, all of which are of low permeability. As of October,
individual well basis with reasonable computing times. A
2001 the Hatton gas field in this project contains over 2900
decision was made to build a full-scale model of the system to
wells with 38 years of production history. Production from the
help plan facilities optimizations for a 600 well infill program
field began in 1964 and was taken over by Fletcher Challenge
for 2002.
Energy in the late 1960’s. Rapid development started in 1986
A discrete reservoir surface network model was chosen to
and has continued to the present. The field has since been
improve the field analyses. All 2136 historic wells in the
acquired by Apache Canada Limited.
Apache operation and 818 outside wells were included in the
This field has three shallow Cretaceous gas zones, Milk
reservoir history match.
River (MR), Medicine Hat (MH) and Second White Speckled
Databases and programs developed to process data were
Sandstone (SWS). The MR and MH zones contain shale and
used to help eliminate the manual sorting and calibration of
silt layers with sandy lenses. The MH pay is all at the top of
large quantities of well and reservoir data. This eliminated the
the formation immediately below the MR. The Milk River and
2 SPE 84222
need for any manual handling of the data and thus reduced the
likelihood of errors.
The reservoir was history matched and the surface
gathering system was calibrated. Several forecast cases
involving combinations of additional compression, new sales
delivery points and line looping were then investigated upon
the tie-in of a 600 well drilling program. The resulting model
forms a comprehensive tool for facility and well evaluations
for these large reservoirs with complex gathering systems.
The techniques presented in this paper allow the operator to
have a detailed working model of the entire shallow gas
property at stake, taking much of the uncertainty out of the
day to day operating decisions.
Simulator
The simulator solves the network and reservoir systems in
a sequential manner. The network, which includes all surface
facilities and the well inflow equation, is solved to establish
the production rates at the wells. These rates are then used to
update the pressure distributions in the reservoirs tied into
the network.
Reservoir calculations utilize the pseudo gas potential,
while the network is solved on a mass flow basis. The
network and inflow equations are solved simultaneously, thus
facilitating complicated surface networks. Examples of the
latter are line looping, multiple demand nodes, parallel
compressors, and in-line compression. Compressors are
defined according to manufacturer defined performance
curves and constraints.
All model runs were performed in Unix on a Digital Alpha
Station XP900 workstation.
Reservoir Model
The Hatton field reservoirs were divided into three model
layers to represent the main producing zones MR, MH and
SWS. Parts of 21 Townships were included. The edge of the
simulation is on the boundary of the Apache operated area to
the east and north while it goes one mile beyond the property
boundary to the south and west as shown in Figure 1.
The SWS net pay and production is limited to Townships
13 and 14 in the southern part of the simulation area. The
main pay has high initial productivity and medium
permeability. There are tighter layers associated with the
permeable sand, particularly to the southeast, but they were
not generally completed and were not included in
the simulation.
Each grid block is one legal subdivision (LSD) or is
approximately 402 meters square. There are 17,158 active out
of 42,780 total grid blocks. The well spacing in the area
varies from four to eight wells per section. This grid block
size was deemed to be sufficient based on previous studies of
a similar gas field1.
All layers are isolated with no cross flow except in the
commingled wells. Commingled production was allocated
based on the permeability-thickness of each layer. Wells
which flow into the Hatton gathering system but do not
produce from any of the three main zones were modeled as
single grid block tanks.
The MR and MH pay were estimated from cross sections.
The SWS net pay was imported from a geological contour of
the productive sand. The map contours were digitized and
read into a program which converted the digitized files into a
format that can be entered into the simulator.
Wells were automatically located in the correct grid block
by using software to interpret the Unique Well Identifier
(UWI). Wellbore details such as tubing and casing diameters,
and depths were entered in the model using a spreadsheet
containing this data. A diagram of the grid system with well
locations is shown as Figure 2.
History Matching
Once the reservoir model was built, it was history
matched. Monthly well production was imported from a
public database and allocated to the layers according to the
completion history. The process of assigning the correct
production to each well was expedited by use of software that
searches the database for a given UWI, and then matches this
with the well in the model with the same UWI.
Net pay thickness and permeability were adjusted to match
historical reservoir pressure measurements. The wells were
set on rate control with grid block and wellhead pressures
calculated by the simulator. A low permeability was first
entered and then increased in small increments until the
recorded volume could be produced with reasonable draw
down. If there was insufficient gas to produce the input
historical rate, the model would shut down and pore volumes
were adjusted until these wells could flow. The formation pore
volume and permeability were then further adjusted to match
observed static reservoir pressures. Localized parameters were
modified to match build up data and confirm the permeability
was in the correct range. The history match included
production from 1964 to mid 2001.
The inflow equation used to define well deliverability is
the Back Pressure equation:
Qg = C (Pr2 – Pwf2)n ..............................................(1)
Theoretical C coefficients (based on kh) for the history
matching were calculated by the model by the equation:
0.00528 * kh ........................(2)
C=
 r  
ln 0.3545 *  e  + S  * µ Z T
  rw  
where,
∆x∆y
re = ..........................................................(3)
π
Some of these theoretical coefficients had to be manually
adjusted to achieve the specified flow rates at particular wells.
These coefficients will eventually be adjusted to match actual
conditions at the end of calibration.
SPE 84222
Pressures were matched at individual wells where
pressures were recorded. The historical production at a given
well was input and the model calculated the pressure as a
function of time. The measured pressures were matched in the
model by adjusting the permeability and pay in the vicinity of
the well. An example is shown in Figure 3.
Figure 4 shows the pressure distribution at May, 2001
along with measured pressures at selected points for the MR
layer. The simulated average pressure was close to the
measured average although the accuracy of the match varies
through the area. Average simulated and measured pressures
are tabulated by year in Table 1. The average simulated value
for year 2001 was within 4% of the measured. The 1998
simulated values were about 2% low while the 1999 are 2%
high and the 1992 numbers were within 1% of the measured
values. The standard deviation of the data indicates the same
amount of variation in the simulated and measured values. If
10 or 11 deviant points are removed the average moves to
within 2% of the measured. The simulated and measured
points were generally within 5% while a small percentage of
the points have differences greater than 25%.
The effective MR permeability was estimated at 0.4 mD
through the central area while being between 0.2 mD and 0.3
mD in the north and 0.6 mD to 1.0 mD in the south. The
permeability of the MH was about 50% higher than the MR
while the permeability of the SWS varies from 5 mD to 50
mD. The MR or MH trends similar to the OGIP, higher to the
south and west. The SWS has high permeability thickness
through the central part of its productive area. The
productivity or permeability decreases to the north and east.
Automatic history matching was considered, but deemed
not to be suitable. Sparse data, a coarse grid and difficulty of
including wellhead flowing pressures (which influences the
calculation of the C coefficient) would make an automatic
history match problematic.
The run time for each history match run was
approximately 15 minutes for 38 years of production history
and 2954 wells. The total time spent on the history matching
was about 35 man-days.
Network Setup
A digital pipeline map file drawn to scale was provided by
the client was used to assist in building the surface network.
An in-house graphical pipeline interface program that could
read the pipe segments from this map was used to create a
template. The network was then created by using this template
as a guide to digitize the pipe segments in the pipeline
program. Pipe diameters had to be manually entered, but
could be done simultaneously for groups of pipes of the same
diameter according to the color-coding from the digital map.
Pipeline lengths were calculated interactively by the program
based on the map scale.
Locations for all wells in the field specified by Universal
Transverse Mercator (UTM) coordinates were available in
spreadsheet format. This coordinate system was transformed
to the scale used on the digitized pipeline map. The graphical
pipeline interface program then places nodes at the well
locations as defined by the UTM coordinates. This allowed
3
the wells in the model to be located automatically without the
necessity of any manual digitizing of the nodes. A schematic
diagram of the entire network is shown as Figure 5.
The total time to set up the reservoir, and surface network
model was approximately 15 man-days.
Network Calibration
Once the network was built, it had to calibrated to reflect
current operating conditions. For the network calibration it is
desirable to have as much performance data as possible when
the network is reasonably stable in terms of operating
conditions. October 31, 2001 was selected as the calibration
date and gas rates and wellhead pressures at each well,
compressor flow rates and suction and discharge pressures
were available in spreadsheet format. Much of this data was
available or could be converted to spreadsheet format, which
greatly accelerated the processing of the data.
The friction factor multiplier was adjusted in the pipelines
until the model calculated wellhead flowing pressures
matched the field observed wellhead flowing pressures. The
pressure drop along a given pipe segment was determined by:
L ⋅ f ⋅ w2 1 1 (ρ + ρ ) ⋅ g
P2= P1 − ⋅ ( + ) − 1 2 ⋅ (E2 − E1) .........(4)
4E3⋅ D⋅ A2 ρ1 ρ2 2E3
This part of the modeling was not automated due to the
occurrence of questionable or scattered pressure readings. In
this case, judgement was used to determine which readings to
disregard.
Compressor discharge and suction pressures were also
matched. During calibration, the measured pressure drops
across the compressors were fixed to keep the suction
pressures constant while calibrating the rest of the gathering
system. The compressor efficiencies were matched by scaling
the manufacturer’s curves to fit the rates and conditions on the
calibration date.
At the time of calibration the wellhead pressures were in
the range of 300 kPa to 700 kPa, compared to a range of 220
kPa to 310 kPa at the compressor inlets. The measured and
simulated wellhead pressures were generally matched to
within 10 kPa or less than a 5% difference. The group line
pressures have less than 2% error or were within 5 kPa
throughout the system. In some cases where difficulty was
encountered in matching the observed data, dimensions were
checked and errors were found in the raw data.
The friction factor modifiers were generally less than 2.0.
In general, no high-pressure drops or bottlenecks were
identified in the analyses. Line pressure drop was generally
less than 100 kPa. A short segment of group line was found
with a pressure drop of more than 12 kPa per km (3 psi per
mile). Friction loss in the well tubing was in the order of 10
kPa, a small portion of the overall pressure drop. Water
production from the wells was minimal and considered
insignificant for modeling purposes.
Well indices and limits were based on field data. The “n”
index was set at 0.9 based on pressure transient buildup tests
that were conducted in this field. Values moderately below
4 SPE 84222
1.0 are observed in outside areas. (n indices were recorded in
an approximate range of 0.8 to 1.0 in a field west of Hatton).
A portion of the network which shows some of the looping
in the network and two of the sales points, along with the
actual measured and calibrated model pressures of October
31, 2001, is shown in Figure 6. Also shown on this figure are
the friction factor multipliers for each pipeline segment.
At the end of the calibration, the Back Pressure equation C
factors were automatically adjusted by the model to match the
wellhead pressures calculated by flowing out of the reservoir
and up the wellbore to wellhead pressures calculated in the
network. This effectively prepares the model for forecasting.
The run time for the calibration step was about 60 seconds
for 1846 active wells. The total time required for completion
of the network calibration phase of the modeling was about
18 man-days.
Forecasting
Several forecast cases were proposed to alleviate
bottlenecks in the system by looping, additional compression
or new sales points. The forecasts also included infill drilling,
and flowline modifications. The initial forecasts analyzed line
looping and small development programs.
The forecast well C factors were based on a mapping of
the average C coefficients determined for the existing wells
which produced from both the MR and MH layers.
Specifically, the ratios of the C determined at the end of
calibration to the theoretical C determined for the history
match were calculated. These values were plotted and
interpolated on a grid program to assign a C ratio to each grid
block. The final C coefficient assigned to an infill well is
determined by multiplying the ratio associated with the infill
grid block by the theoretical C calculated by Equation 2. This
procedure was repeated for infill wells completed only in the
SWS zones, which where produced separately, using existing
wells that were completed only in the SWS.
Several initial cases were run with all 600 infill wells on at
the same time to determine peak rates and some compression
addition, new sales points and flowline modifications. Cases
were also run with further line looping or crossover between
different group lines to reduce pressure but this had only a
minor effect on the total production. The economic limit was
set at 0.15 E3m3/d per well.
Based on the results of these initial forecasts, a final case
was selected based on the optimum compression and pipeline
scenario. Three variations of this case were run with a more
accurate representation of the timing of the infill wells. The
infill wells were to start producing in August, 2002 and were
brought on at approximately 100 wells per month. A new
sales point with a compressor station was put on stream
August 1, 2002. An average well added a net rate of
approximately 1.0 E3m3/d to the total field production while it
produced approximately 1.3 E3m3/d. Individual new wells
produce between 0.80 and 1.5 E3m3/d. The SWS wells input
as isolated completions, start at approximately 1.4 E3m3/d
each with attendant back-out of approximately 0.3 E3m3/d. In
total, the infill wells contributed a maximum rate of about 720
E3m3/d as the original wells were backed-out by 120 E3m3/d.
A sample of the results of some the final cases are shown
in Figure 7 and Table 2. Case 1 was a forecast case with the
600 infill wells turned on at approximately 100 per month
starting August 1, 2002 with a new plant and compressor
station on stream at that time. Case 2 was the same as Case 1
with a group of SWS wells added as separate completions.
The forecast cases were set up quickly using similar methods
to those used in the set-up of the original model. All cases
were run for ten years and the average run time for each case
was about 15 minutes. Setting up the initial forecast case for
600 infill wells required about 14 man-days, which includes
the time to set up each completion and the surface pipelines
for each well.
The location and timing of many of the infill wells actually
drilled for 2002 were ultimately different than forecasted. An
as-built case was run using the above method for calculating
the C coefficients, accounting for the actual infill wells drilled,
actual tie-in points, production schedule and compressor
additions. This new forecast was plotted against the actual
production in Figure 8. The forecast gas rate matches the
actual production until just after the point at which an
additional compressor unit was put into service on October 15,
2002. The initial gain in production when the initial groups of
infill wells were put on production is matched in the forecast,
but subsequently the forecast rates are higher than the actual
rates. This is due to operational problems and freezing in the
pipeline and wellheads. At certain points (e.g. Feb 21, 2003)
when these problems are temporarily resolved, it can be seen
that the field is able to achieve the rates which were
forecasted. Further comparison when these operational
problems are fully resolved will further validate the model.
Initial shut-in wellhead pressures were recorded at the all
infill wells. Comparison of these pressures to those predicted
by the model shows about that 40% of the pressure readings
were reasonably matched by the model while 55% were
within 10% and the remaining 5% were within 20%. There
were some isolated anomalous readings which showed larger
deviations but some of these could attributed to inaccuracies
or problems with the readings.
Conclusions
The model provides a base line to evaluate development
and operation alternatives and to enhance the understanding of
the reservoir and facilities. Continued data monitoring and
possibly model adjustments will improve the overall accuracy
of the projections and increase the confidence in the model.
This is particularly important in order to evaluate and support
further down spacing. The reliability of the forecasts depends
on the accuracy of the model calibration. Thus, it is important
to collect reliable, pertinent field data.
The current 600 well drilling program provides an
excellent opportunity to monitor the reservoir pressure and
further define the strata. The recording of the final shut in
pressure after the fracturing of new wells as in last year’s
program, provides a cost effective indication of the pressure
distribution. Static gradients are required on a large portion of
the wells to verify the bottom hole estimates. The number of
static gradients run should be high enough to be statistically
SPE 84222 5

reliable and yet cost effective. Running bottom hole build-ups Acknowledgments
would further verify the correlation of the surface readings to
the reservoir. Thanks to Apache Canada Ltd. for granting permission to
The model has continued to be used for further forecasting publish the paper.
involving new compressors (both boosters and in parallel with
existing units), looping and additional sales points to identify Peter Holst, Frank Sorensen and Richard Holst of PHH
a viable method to achieve a targeted field rate. Also Petroleum Consultants Ltd. for their assistance in setting up
simulated was a plan to build a pipeline send gas from the and maintenance of the model.
Hatton system to a third-party pipeline to reduce the back-out
in the network to determine the incremental production. Such Walter Seyer, independent consultant, for work on the
cases typically required a half-day or less to set up and run. history matching.
More recently, a new forecast case involving a 550 well infill
program for 2003 and tying in third party wells has been References
conducted. The model has also been used extensively to
quantify the losses due to back-out at existing wells as a result 1. Holst, R., Malowany, L. and Kopjar, R. “Computer
of additional infill wells. Optimization of Large Gas Reservoirs with Complex
The use of databases and automation techniques in Gathering Systems”, paper SPE 56548 presented at the
conjunction with sorting and graphics software results in 1999 SPE Annual Technical Conference and Exhibition
considerable time savings as opposed to the time required for held in Houston, Texas, 3–6 October 1999.
manual inputs, which may make such an undertaking
impractical. An extremely stable and efficient numerical
solution method also contributes to the efficiency of
the modeling.
Integrated forecasts with a large number wells and
complex networks can obtained in a short time and can be
obtained at lower cost than alternative methods. This is also
much more efficient and accurate than simplified approaches
such as manual or spreadsheet calculations or using tanks
models to represent the reservoirs.

Nomenclature

A = area open to flow, m2

C = c-coefficient in back pressure equation, m3/kPa2nd
D = pipeline inside diameter, m
E = node elevation, m
ƒ = Colbrook friction factor (function of Reynolds No.)
g = gravitational acceleration, 9.81 m/s2
L = pipeline length, m
n = n-coefficient in back pressure equation, dimensionless
ρ = density = P/zRT, kg/m3
P = pressure, kPaa
Pr = reservoir pressure, kPaa
Pwf = well flowing sandface pressure, kPaa
Q = gas flowrate, m3/d
rw = well radius, m
S = skin, dimensionless
T = temperature, K
Z = gas deviation factor
µ = viscosity, cp
w = mass flow rate, kg/d
∆x = grid block dimension in x-direction, m
∆y = grid block dimension in x-direction, m
6 SPE 84222

TABLE 1 - RESERVOIR PRESSURE SUMMARY

Measure- Measured Simulated Diff. Sim.- Measured Simulated
Year Layer ments Pressure Pressure Measured Std. Dev. Std. Dev.
# # kPaA kPaA % kPaA kPaA

2001 1 21 1883 1915 1.7 460 471

2 1 1706 1689 -1.0
3 1 1650 1504 -8.8
1&2 177 1693 1694 0.1 367 320
All 201 1713 1782 4.0
*Modified 190 1744 1776 1.8

1999 1 8 2541 2696 6.1 460 471

2 4 2897 3103 7.1 216 203
1&2 10 2640 2588 -2.0 732 577
All 22 2656 2722 2.5

1998 1 9 2473 2567 3.8 460 471

1&2 24 2374 2277 -4.1 367 320
All 33 2401 2356 -1.9

1992 1 35 2590 2580 -0.4 546 471

2 7 3015 3021 0.2 421 423
3 8 2381 2480 4.2 256 383
All 50 2616 2626 0.4

Original 1 3300
2 4100
3 5800

Notes:
1. The simulated pressure is the grid block pressure at the same location as
the measured point.
2. Except for a minor number of points in 1998 and 1992 all data represents
the shut in pressure after fracture clean-up.
* Remove 11 low deviant points.
SPE 84222 7

TABLE 2 - FIELD FORECAST SUMMARY

Case Gas Rate Cum. Gas Gas Rate Cum. Gas

3 3 6 3 3 3 6 3
(E m /D) (E m ) (E m /D) (E m )
Jan. 2003 Dec. 2012

Base 1431.5 675.7 729.3 4343.3

Case 1 2017.5 762.7 866.7 5504.5

Case 2 2033.3 763.1 877.1 5569.0

Case1 Turn on infill wells ~100/month starting August, 2002

+ New Compressor Station & Plant

Case 2 Turn on infill wells ~100/month starting August, 2002

+ New Compressor Station & Plant + SWS infill wells

Note: Cum. Gas is production since Oct. 31, 2001

8 SPE 84222

Fig. 1 – Apache Hatton Simulation Area

SPE 84222 9

Fig. 2 - Grid System for Hatton. Wells denoted by (+).

10 SPE 84222

Fig. 3 History Match Plot for Typical Well

SPE 84222 11

Fig. 4 – Pressure Distribution in Milk River Layer at May, 2001

12 SPE 84222

Fig. 5 – Schematic of Hatton Gathering System.

SPE 84222 13

Fig. 6 – Partial Schematic of Gathering System Showing Model Calculated and Measured Pressures on the Calibration Date of
October 31, 2001
14 SPE 84222

Fig. 7 – Sample Forecast Cases

Apache Hatton
Actual Field & Forecast Gas Rates
2500

2000
Gas Rate (E3 m 3/d)

1500

Actual Gas Rates

Calibration Date: Forecast Gas Rates
1000
October 31, 2001
Infill w ell production begins:
August 1, 2001
500

Fig. 8 As-built Forecast Case Comparison With Actual Field Rates