6/13/16 2:57 PM

July16_JPT_Cover.indd 1
J U LY 2 0 1 6 • V O L U M E 6 8 , N U M B E R 7 JOURNAL OF PETROLEUM TECHNOLOGY
 ResFlow CV CHECK-VALVE ICD

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ResFlow CV full page for JPT June 16-CO-145466 AD.indd 1 5/9/16 4:17 PM
CONTENTS
Volume 68 • Number 7

14 GUEST EDITORIAL • AIMING FOR A BETTER OIL PRICE

As an example of an open system, the oil and gas market is a
function of several external forces. Free market supply and demand
may not yield a sustainable equilibrium price, but the deferral
of capital projects will result in a lack of global supply in just a
few years.

27 BREAKING FROM THE NORM TO REACH MARGINAL

OFFSHORE FIELDS
A number of companies are pushing for alternative approaches
to offshore development that seek to access marginal reservoirs.
Their differing and unique ideas call for a departure from the usual
playbook, but share a common goal of slashing capital costs.

34 BOPs BECOME THE FOCUS OF DATA-DRIVEN

SCRUTINY
Well control is built around huge steel machines, but the future
of the business is digital. Data have become a critical asset as A computer illustration shows
a standalone drilling tool being
operators and services companies work to increase the safety lowered into the subsea. Still under
and reliability of their products and operations. development in Norway, the tool is
designed to lower the cost of drilling
40 INCREASING EFFICIENCY, SAFER OPERATIONS KEY exploration wells by eliminating the
THEMES AT OTC need for a rig. Image courtesy of
Badger Explorer.
Coverage of the 2016 Offshore Technology Conference held in
Houston. Conference sessions covered new offshore technologies
and advances in existing technologies that reduce costs and
improve safety.

51 SPE ATCE TO FOCUS ON INDUSTRY DEPARTMENTS

TRANSFORMATION
The SPE Annual Technical Conference and Exhibition (ATCE) 6 Performance Indices
from 26 to 28 September in Dubai will examine the theme of 8 Regional Update
transforming and shaping the future of E&P. It will be the first ATCE 10 President’s Column
held in the Middle East. 12 Comments
16 Technology Applications
53 MANAGEMENT • SOLVING THE CASING-WEAR
PUZZLE USING STIFF-STRING MODEL 20 Technology Update
Precise casing-wear prediction is important for improving well 22 Young Technology Showcase
integrity and longevity. This article proposes a new modeling 24 E&P Notes
method for casing-wear prediction which aims to reduce the 93 People
uncertainties in downhole wear estimation. 94 SPE News
94 SPE Events
95 Professional Services
96 Advertisers’ Index

An Official Publication of the Society of Petroleum Engineers. Printed in US. Copyright 2016, Society of Petroleum Engineers.
TAM-189_Corporate_Ad_051016_outlines.indd 1 5/10/16 11:58 AM
TECHNOLOGY FOCUS
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you the
56 RESERVOIR SIMULATION
William J. Bailey, SPE, Principal, Schlumberger-Doll Research superpowers
57 Project Tests High-Performance Cloud Computing for Reservoir
Simulations you’ve
60 Modeling of a Complex Reservoir Where the Normal Modeling Rules
Do Not Apply always
63 Use of Emulator Methodology for Uncertainty-Reduction Quantification
65 Simulation Analysis With Association-Rule Mining Plus High-Dimensional
dreamed of.
Visualization Introducing the world’s
first X-Ray technology
67 ARTIFICIAL LIFT for oil wells.
Mike Berry, SPE, Independent Artificial-Lift Consultant
VISURAY’s revolutionary VR90 ®
68 Evaluation of Intermittent-Flow Behavior Upstream of Electrical not only finds downhole blockages
Submersible Pumps
faster, it lets you see 2D and 3D
70 Run-Life Improvement by Implementation of Artificial-Lift-Systems reconstructions of the obstruction.
Failure Classification We’ll illuminate the problem, you’ll
72 Methodology Evaluates Artificial-Lift Requirements Amid High eliminate the problem. Better yet,
Uncertainty you’ll eliminate downtime and
increase profitability.
74 NEW-FRONTIER RESERVOIRS I
Simon Chipperfield, SPE, Chief Production Engineer, Santos
Contact us for a
75 A Flexible “Well-Factory” Approach to Developing Unconventionals
demonstration
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78 A More-Rigorous Development Framework for Unconventional Reservoirs
80 Production Performance in the In-Fill Development of Unconventional
Resources

84 CO2 APPLICATIONS
Sunil Kokal, Principal Professional, Saudi Aramco

85 Chemical-Looping Combustion: An Emerging Carbon-Capture Technology

87 Viscosity and Stability of Dry CO2 Foams for Improved Oil Recovery
89 A Portfolio of Commercial-Scale Carbon-Capture-and-Storage
Demonstration Projects

91 CO2-Based Enhanced Oil Recovery From Unconventional Reservoirs

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The complete SPE technical papers featured in this issue are available
free to SPE members for two months at www.spe.org/jpt.
p opl
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The power of our resources means
nothing without the energy of our
people. Their focus and expertise make
our energy more dependable, more
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SPE BOARD OF DIRECTORS
OFFICERS
2016 President
Nathan Meehan, Baker Hughes
2015 President
Helge Hove Haldorsen, Statoil
2017 President
Janeen Judah, Chevron
Vice President Finance
Roland Moreau, ExxonMobil Annuitant
REGIONAL DIRECTORS
AFRICA
Adeyemi Akinlawon,
Adeb Konsult
CANADIAN
Darcy Spady, Broadview Energy
EASTERN NORTH AMERICA
Bob Garland, Silver Creek Services
GULF COAST NORTH AMERICA
J. Roger Hite, Inwood Solutions
MID-CONTINENT NORTH AMERICA
Michael Tunstall
MIDDLE EAST
Khalid Zainalabedin, Saudi Aramco
NORTH SEA
Carlos Chalbaud, ENGIE
NORTHERN ASIA PACIFIC
Phongsthorn Thavisin, PTTEP
ROCKY MOUNTAIN NORTH AMERICA
Erin McEvers, Clearbrook Consulting
RUSSIA AND THE CASPIAN
Anton Ablaev, Schlumberger
JPT STAFF
Glenda Smith, Publisher
John Donnelly, Editor
Alex Asfar, Senior Manager Publishing Services
Pam Boschee, Senior Manager Magazines
Chris Carpenter, Technology Editor
Trent Jacobs, Senior Technology Writer
Anjana Sankara Narayanan, Editorial Manager
Joel Parshall, Features Editor
Stephen Rassenfoss, Emerging Technology Senior Editor
Stephen Whitfield, Staff Writer
Adam Wilson, Special Publications Editor
Craig Moritz, Assistant Director Americas Sales & Exhibits
Mary Jane Touchstone, Print Publishing Manager
David Grant, Electronic Publishing Manager
Laurie Sailsbury, Composition Specialist Supervisor
Dennis Scharnberg, Proofreader
archerwell.com/point
SOUTH AMERICA AND CARIBBEAN
Anelise Quintao Lara, Petrobras
SOUTH ASIA
John Hoppe, Shell
SOUTH, CENTRAL, AND EAST EUROPE
Matthias Meister, Baker Hughes
SOUTHERN ASIA PACIFIC
Salis Aprilian, PT Badak NGL
SOUTHWESTERN NORTH AMERICA
Barrier
Libby Einhorn, Concho Oil & Gas
WESTERN NORTH AMERICA
Andrei Popa, Chevron
failure is
TECHNICAL DIRECTORS
DRILLING AND COMPLETIONS
David Curry, Baker Hughes
certain.
HEALTH, SAFETY, SECURITY, ENVIRONMENT,
AND SOCIAL RESPONSIBILITY
Trey Shaffer, ERM
MANAGEMENT AND INFORMATION
J.C. Cunha
PRODUCTION AND OPERATIONS
Jennifer Miskimins, Barree & Associates
PROJECTS, FACILITIES, AND CONSTRUCTION
Howard Duhon, GATE, Inc.
RESERVOIR DESCRIPTION AND DYNAMICS
Tom Blasingame, Texas A&M University
Well integrity
DIRECTOR FOR ACADEMIA
Dan Hill, Texas A&M University
is at a tipping
AT-LARGE DIRECTORS point.
Khaled Al-Buraik, Saudi Aramco
Liu Zhenwu, China National Petroleum Corporation
Most integrity surveys only
evaluate barrier condition.
Archer’s new Point® system
The Journal of Petroleum Technology® magazine is a
registered trademark of SPE.
evaluates barrier performance
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tinent to the interests of the Society in its publications.
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 PERFORMANCE INDICES

WORLD CRUDE OIL PRODUCTION1+‡ HENRY HUB GULF COAST NATURAL GAS SPOT PRICE‡

THOUSAND BOPD
6
O PEC 2015 JUL AUG SEP OCT
Algeria 1370 1370 1370 1370 5 USD/million Btu
Angola 1890 1910 1800 1810 4
Ecuador 538 537 539 538
3
Iran 3300 3300 3300 3300
Iraq 4375 4275 4425 4275 2
Kuwait* 2550 2550 2550 2550
1
Libya 400 360 375 415

JUN

JUL

AUG

SEP

OCT

NOV

DEC

2016
JAN

FEB

MAR

APR

MAY
Nigeria 2270 2320 2320 2370
Qatar 1537 1537 1537 1537
Saudi Arabia* 10290 10290 10190 10140
UAE 2820 2820 2820 2820 WORLD CRUDE OIL PRICES (USD/bbl)‡
Venezuela 2500 2500 2500 2500

TOTAL 33840 33769 33726 33625 2016

OCT NOV DEC JAN FEB MAR APR MAY
Brent 48.43 44.27 38.01 30.70 32.18 38.21 41.58 46.85
THOUSAND BOPD WTI 46.22 42.44 37.19 31.68 30.32 37.55 40.75 46.83
NON-OPEC 2015 JUL AUG SEP OCT
Argentina 532 529 529 535
Australia 361 360 335 330 WORLD ROTARY RIG COUNT†
Azerbaijan 867 867 867 872
Brazil 2466 2547 2395 2406 2016
REGION NOV DEC JAN FEB MAR APR MAY
Canada 3821 3912 3412 3581
US 760 714 654 532 478 437 408
China 4263 4278 4317 4259
Canada 178 160 192 211 88 41 42
Colombia 947 968 1009 1030
Latin America 284 270 243 237 218 203 188
Denmark 154 157 154 157
Europe 108 114 108 107 96 90 95
Egypt 524 511 510 509
Middle East 419 422 407 404 397 384 391
Eq. Guinea 250 250 250 250
Africa 90 91 94 88 91 90 91
Gabon 215 215 215 215
Asia Pacific 208 198 193 182 183 179 190
India 754 768 757 758

Indonesia 801 777 800 801 TOTAL 2047 1969 1891 1761 1551 1424 1405

Kazakhstan 1592 1593 1594 1595

Malaysia 599 591 652 619
WORLD OIL SUPPLY AND DEMAND2‡
Mexico 2308 2291 2306 2314
Norway 1611 1599 1581 1685 MILLION BOPD 2015 2016
Oman 1001 990 985 980 Quarter 2nd 3rd 4th 1st
Russia 10200 10180 10150 10140
SUPPLY 95.40 96.40 96.49 95.61
Sudan 257 254 255 257
DEMAND 93.32 94.97 94.08 94.22
Syria 30 30 30 30
UK 838 788 862 912
USA 9433 9407 9460 9347 INDICES KEY

Vietnam 343 307 348 333 + Figures do not include NGLs and oil from nonconventional sources.
* Includes approximately one-half of Neutral Zone production.
Yemen 22 22 22 22
1 Latest available data on www.eia.gov.
Other 2496 2479 2517 2509 2 Includes crude oil, lease condensates, natural gas plant liquids, other hydrocarbons for refinery feedstocks,
refinery gains, alcohol, and liquids produced from nonconventional sources.
Total 46685 46670 46312 46446
† Source: Baker Hughes.
Total World 80525 80439 80038 80071 ‡ Source: US Department of Energy/Energy Information Administration.

6 JPT • JULY 2016

 REGIONAL UPDATE
AFRICA
Z Cairn Energy reported that the
SNE-4 appraisal well offshore Senegal
encountered a gross oil column of 328 ft.
Drilled as part of an appraisal campaign
over the SNE field, which was discovered
in 2014, the well confirmed the correlation
and presence of principal reservoir units
between each of the wells across the
entire field. The 32 °API oil recovered to the
surface was similar to that seen elsewhere
in the field, according to initial indications.
Cairn, the operator, has a 40% interest in
the well with the other interests held by
ConocoPhillips (35%), FAR (15%), and
Petrosen (10%).
Z Eland Oil & Gas said that the company
and operator Nigerian Petroleum
Development Corporation (NPDC) have
completed re-entry work and boosted
production at the Opuama-3 well on
the OML license in Nigeria. Workover
operations included the perforation of
two new intervals and production logging
runs in both strings. The combined flow
from the two strings was tested for 1 hr on
a 48/64-in. choke and produced at a rate
equivalent to 10,584 B/D of dry crude.
NPDC holds a 55% interest in the license
with the remaining share held by Elcrest
Exploration and Production Nigeria,
Eland’s joint-venture subsidiary.
ASIA
Z SapuraKencana Petroleum reported
May 31 that it had discovered gas in a
three-well 2015 drilling campaign in
production sharing contract (PSC) SK408
offshore Sarawak in Malaysia. The Jerun-1
well, which is 3.1 miles north of the 2014
Bakong discovery, is a multi-Tcf discovery
with an interpreted gross gas column of
approximately 2,625 ft in the primary
target reservoir. The Jeremin-1 well
encountered a gross gas column of 341 ft,
and the Putat-1 prospect was a dry hole.
SapuraKencana is the exploration operator
with a 40% working interest in the PSC.
Petronas Carigali and Shell each hold
30% interests.
Z Woodside Petroleum has increased the
company’s best estimate of contingent
8 JPT • JULY 2016
(2C) resources to 4.48 billion BOE, an
increase of 83 million BOE, following two
first-quarter discoveries offshore Myanmar.
The company announced the discovery of
105 ft of net gas pay in the Block A-6 Shwe
Yee Htun-1 exploration well—an increase of
56 ft from an earlier estimate—and 203 ft
of net gas pay in the Block AD-7 Thalin-1A
exploration well. Woodside’s early success
in Myanmar establishes the petroleum
system credentials of the Rakhine Basin,
where the company is one of the largest
acreage holders with interests in six blocks.
Z Santos has spudded the AAL-4X
appraisal well in the Northwest Natuna
Production Sharing Contract (PSC) offshore
Indonesia. The company-operated well is
being drilled in 236 ft of water to a planned
maximum 4,042-ft true vertical depth
from mean sea level. The well targets the
G Sand reservoir, which is estimated to
hold 36 million bbl of gross recoverable oil
resources. Santos and AWE each have a
50% interest in the PSC.
AUSTRALIA/OCEANIA
Z Empire Oil & Gas reported encouraging
test data from its solely owned Red Gully
North-1 discovery well in permit EP 389 in
Western Australia. Test results from the
Cattamarra C and Upper D intervals yielded
an estimate of 7.5 PJ (1.2 quadrillion BOE)
of contingent gas resources, which
are potentially recoverable but sub-
commercial because of business and/
or technological hurdles. Testing of the
Lower D interval indicated a sandstone
of very low permeability that is unable
to flow commercial quantities of gas and
condensate. The Cattamarra C and Upper D
sands are being isolated from a high-water
zone and retested.
EUROPE
Z InfraStrata has spudded the Woodburn
Forest-1 well in County Antrim in Northern
Ireland, the United Kingdom. With a
planned well depth of 6,561 ft, the drilling
targets three conventional sandstone
intervals. P50 prospective resources
targeted by the well are estimated at
25 million bbl of oil. After drilling, the well
will be plugged and abandoned and the site
will be restored to its former state. Should
results be favorable, additional consent and
plan approval will be needed for further
activity such as testing. InfraStrata is the
operator with a 20% interest in the well with
seven other companies holding stakes of
9% to 16%.
MIDDLE EAST
Z Circle Oil has produced oil from the
AASE-24 well on the North West Gemsa
field in Egypt. Drilled as part of the field’s
2016 infill campaign, AASE-24 recorded an
average gross output rate of 1,714 B/D of
oil and 3 MMcf/D of gas through a 40/64-in.
choke. The rate is being lowered to protect
the field’s long-term production capability,
the company said. Circle has a 40% interest
in the field, which is operated by NPIC,
a subsidiary of Zhen Hua Oil (50%). The
remaining stake is held by SDX Energy.
NORTH AMERICA
Z EOG Resources’ Chairman and Chief
Executive Officer Bill Thomas told investors
on 6 May that the company has the ability
to post strong returns with oil prices at
approximately USD 40/bbl and would post
triple-digit returns should prices spike to
USD 60/bbl. The Houston-based company
is considered one of the most efficient US
drillers. EOG is also successfully boosting
recovery from existing wells with relatively
low new investment, particularly in south
Texas’ Eagle Ford Shale. These projects “will
get more efficient as we move forward, and
lower cost,” Thomas said.
SOUTH AMERICA
Z LGO has started production from a
new interval on well GY-671 in its solely
owned Goudron field in Trinidad. A total of
208 ft of perforations were added to the
well’s Upper C-sand reservoir following
the isolation of the zone with a packer.
The interval had never been completed in
the various surrounding wells. After initial
cleanup operations, the well flowed at rates
of up to 240 B/D of oil before being choked
back to a natural stabilized rate of 80 B/D.
The additional production will complement
a base field rate that averaged 403 B/D
in March. JPT
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 IMPROVING PEOPLE’S LIVES
Minimizing Impact
Nathan Meehan, 2016 SPE President
Last December I had the pleasure of
returning to the Kingdom of Saudi Ara-
bia and touring the giant Manifa oil field.
Manifa produces a heavy, sour crude oil
from six, long (up to 40 km), stacked res-
ervoirs in shallow water (Arukhe 2014).
The shallow waters have abundant sea
grasses and corals and are teeming with
marine life. Shrimping and fishing are important parts of the
local economy. The development of the Manifa field is a fas-
cinating story showing how creative solutions can minimize
impact on the environment.
Manifa was discovered by Saudi Aramco in 1957. The discov-
ery well targeted both the shallower formations productive in
the large Safaniya coastal field and the deeper Arab formations
so productive onshore. Neither zone was productive; however,
the discovery found excellent productive layers in between, in-
cluding three that were only produced in small volumes on-
shore and three that had never before proved productive. The
heavy, sour crude was similar to Khursaniyah, one of the three
major types of crude present in large quantities in the King-
dom. Demand was less for this crude than for Safaniya and Arab
crudes but the market for heavy sour crudes was improving
(Aramco World 1963). The first development was in 1962, and
the field was brought on stream in 1964. The field produced for
20 years before being mothballed in 1985 because of low de-
mand (Aldossary 2015).
The design and operations practices of the Manifa oil
field enable high production with minimal environmental
impact.
To contact the SPE President, email president@spe.org.
10
Manifa’s history can be contrasted with that of Prudhoe Bay
in Alaska. While specific reserve estimates for Manifa are not
public information, both fields are very large. The Prudhoe Bay
field was discovered in 1968 and did not begin production until
1977. Prudhoe production peaked at about 1.5 million BOPD in
1989. Prudhoe Bay crude averages 27.6 °API and had a signifi-
cant domestic market to serve. Manifa crude is 26–31 °API and
has from 2.8% to 3.7% sulfur content (Croft and Patzek 2009),
with less of a market at the time. It is fairly astonishing that
roughly comparable fields would go down such radically differ-
ent paths.
Manifa would remain mothballed until 2006. Saudi Aramco
redeveloped the field consistent with a very long life produc-
tion time horizon for its large reservoirs (Saudi Aramco 2016).
But the old way of approaching shallow offshore fields would
not be acceptable.
The use of jackup rigs in these shallow waters would have re-
quired excessive dredging, and the size of the reservoir elimi-
nated the possibility of effective development from the shore. A
new approach to development would be needed. A creative plan
to develop man-made islands connected by a causeway would
allow conventional onshore rigs to be used to develop this off-
shore field.
A long causeway was considered, but early designs would
have decreased water circulation vital to distributing nutrients
and oxygen vital to marine life. With more than 4 million man-
hours of work in the design phase, a solution was developed to
build 27 man-made islands connected by 41 km of causeways.
To ensure needed water circulation, the causeway does not go
all the way across the bay and 14 bridges were built into the
causeway to further improve circulation (Aldossary 2015). Pro-
duction commenced in 2012 ahead of schedule and under bud-
get in a development that earned a UNESCO Environmental Re-
sponsibility Award nomination.
It is an impressive development of which Saudi Aramco
is rightly proud, with eventual production capacity of
900,000  BOPD or more. As our helicopter approached the
massive processing facility, I looked at the three large flare
stacks. There was nothing being flared. Was the field shut in?
No, the design and normal operations of the field use all of the
produced gas and creative operations practices mean that al-
most no gas is flared. Excess electricity produced by the facili-
ties goes into the power grid.
JPT • JULY 2016
 Walking to the edge of the offshore islands I looked into References
the crystal blue-green waters. They were much clearer than Aldossary, G. 2015. Manifa Oil Field Development Program–Onshore
the waters at the Pacific island resort I had come from a and Offshore Shallow Water Development. Presented at the
few days earlier. I was struck at how small the impact of a 2015 Offshore Technology Conference, Houston, Texas, 4–7 May.
900,000-BOPD facility could be. OTC-25663-MS. http://dx.doi.org/10.4043/25663-MS.
This production volume is comparable to the individual Aramco World. 1963. Manifa–Profile of a Decision. 14 (6) 18–21.
Eagle Ford, Bakken, and Permian Basin unconventionals. Not http://archive.aramcoworld.com/issue/196306/manifa-profile.
a fair comparison to be sure, but the contrast was striking. As I of.a.decision.htm.
have flown over the Fort Worth/Dallas area, the vastness of the Arukhe, J. 2014. Environmentally Friendly Manifa Field
surface impact of more than 16,000 wells is notable. Major Development—The World’s Largest. Presented at the International
unconventional plays cover huge areas and most wells to date Petroleum Technology Conference, Kuala Lumpur, Malaysia,
have not been drilled from multiple-well pads. 10–12 December. IPTC-17833-MS. http://dx.doi.org/10.2523/
Individual well productivities and reserves for unconven- IPTC-17833-MS.
tionals are far lower than the Middle East, or even Alaska, re- Croft, G.D. and Patzek, T.W. 2009. The Future of California’s Oil
quiring orders of magnitude more wells to develop compara- Supply. Presented at the SPE Western Regional Meeting, San
ble reserves or production. In 2014, the combined production Jose, California, 24–26 March. SPE-120174-MS. http://dx.doi.
of the Bakken/Three Forks (North Dakota) and Eagle Ford org/10.2118/120174-MS.
(south Texas) plays was more than 2.4 million BOPD, with Energy Information Administration (EIA). 2015. U.S. Crude Oil and
proved reserves of just under 11 billion bbl of oil (EIA 2015). Natural Gas Proved Reserves, 2014. US Department of Energy,
These reserve estimates are likely to grow, perhaps one day Washington, DC. https://www.eia.gov/naturalgas/crudeoilreserves/
equaling or exceeding Prudhoe or Manifa. Subsequent drill- Saudi Aramco. 2016. Oil Recovery. http://www.saudiaramco.com/
ing will need to minimize impact through techniques such en/home/our-business/worlds-leading-supplier-of-energy/oil-
as these: recovery.html (accessed 17 March 2016).
◗ Making better use of pad drilling to decrease surface
impact
◗ Minimizing traffic
◗ Optimizing the use of flowback and produced water for
subsequent hydraulic fracturing operations
◗ Eliminating fugitive methane emissions and flaring
Close cooperation with regulators is one step forward. As
regulators use both “carrot” and “stick” approaches to reduc-
ing impact and maximizing economic and technical recover-
REGISTER NOW
ies, operators should be able to see clear priorities for subse- URTeC.org
quent developments. With current prices, activity levels and
capital investments have dropped dramatically. This decrease
in activity provides us a chance to carefully analyze our own
performance and identify ways of improving performance
when prices recover to acceptable levels.
A significant number of unconventional wells drilled have
not proved commercially viable. How can we either find ways
to improve their performance—through better geosteering,
alternative completion approaches, or otherwise—or elimi-
nate their drilling? The well that is not drilled has the least
1-3 AUGUST 2O16
environmental and economic impact of all! Some production HENRY B. GONZALEZ CONVENTION CENTER » SAN ANTONIO, TEXAS

logs have indicated that a significant number of hydraulic

fracture stages contribute very little to wellbore inflow. These
logs may be misleading, or perhaps those apparently non-
producing stages helped to increase the production at subse-
quent stages. But guessing is not good enough. Existing inte-
grated natural fracture, hydraulic fracture, geomechanical,
geological, and reservoir flow models continue to have incom- The integrated event for unconventional
plete physics. Now is the time to solve these problems and find resource teams
ways to produce the massive unconventional fields in North
America more safely and economically, with minimal environ- Sponsoring Organizations: Supporting Organizations:

mental impact, and to make unconventional fields around the

world more viable. JPT

JPT • JULY 2016 11

 COMMENTS EDITORIAL COMMITTEE
Bernt Aadnøy, University of Stavanger

Syed Ali—Chairperson, Consultant

Tayfun Babadagli, University of Alberta

Growth in Renewables William Bailey, Schlumberger

Mike Berry, Mike Berry Consulting

John Donnelly, JPT Editor Maria Capello, Kuwait Oil Company

Frank Chang, Saudi Aramco

Simon Chipperfield, Santos

The renewable energy sector is showing strong global growth, Nicholas Clem, Baker Hughes

especially wind and solar power, but oil shows no sign of los- Alex Crabtree, Hess Corporation
ing market share in the global energy mix, particularly after the Gunnar DeBruijn, Schlumberger
steep drop in oil prices over the past 2 years. Mark Egan, Retired
Investment in renewable energy reached an all-time high in
Mark Elkins, ConocoPhillips
2015, with developing countries spending more than developed
Alexandre Emerick,
countries for the first time. Spending on renewable energy hit Petrobras Research Center
USD 286 billion last year, 3% higher than its previous record
Niall Fleming, Statoil
spend in 2011, according to data from the United Nations Environment Program and
the Frankfurt School of Finance & Management. That is in sharp contrast with the Ted Frankiewicz, SPEC Services

steep cuts in capital spending in oil and gas projects since the drop in hydrocarbon Stephen Goodyear, Shell
prices began, although spending in renewables overall pales in comparison with oil Omer M. Gurpinar, Schlumberger
and gas capital expenditure (capex). More than USD 150 billion was cut from oil and A.G. Guzman-Garcia, Retired
gas capex in 2015, with additional cuts evident this year.
Greg Horton, Consultant
Investment in new solar and wind projects rose 50% last year. The growth came
John Hudson, Shell
in developing countries, more than offsetting a decrease in renewable spending in
Europe and North America. Renewable investment in developing countries totaled Morten Iversen, Karachaganak Petroleum

USD 156 billion, according to the UN/Frankfurt School data, an increase of 19% from Leonard Kalfayan, Hess Corporation
the year before. Investment in developed countries equaled USD 130 billion, a drop Tom Kelly, Retired
of 8%. China spent roughly two-thirds of the developing country total (USD 103 bil- Thomas Knode, Statoil
lion), while India spent USD 10 billion and Brazil, USD 7 billion. China spent most of
Sunil Kokal, Saudi Aramco
the money on solar photovoltaic, onshore wind, and nine large offshore wind projects.
Marc Kuck, Eni US Operating
Renewables are making particular progress in power generation but have not been
able to make solid inroads in the transportation sector, a mainstay of hydrocarbon use. Jesse C. Lee, Schlumberger

Spending on biofuels has declined since peaking in 2007. Silviu Livescu, Baker Hughes
The annual Renewables Global Status Report and the annual BP Statistical Review of Shouxiang (Mark) Ma, Saudi Aramco
World Energy, both released in June, confirm the growth in renewables. “Renewables John Macpherson, Baker Hughes
are now established around the world as mainstream sources of energy” because of
Casey McDonough, American Energy Partners
increasing cost competitiveness, policy initiatives, better access to funding, and ener-
Stephane Menand, DrillScan
gy demand growth in developing regions, said the Renewables report, published by
REN21, an organization that works with governments, nongovernmental agencies, Badrul H Mohamed Jan, University of Malaya

and academia to monitor and promote renewable energy use. Michael L. Payne, BP plc
But the BP report points out that a new consumption record was set for oil in 2015 as Zillur Rahim, Saudi Aramco
well, underscoring the worldwide thirst for energy in a variety of forms. Global crude Martin Rylance, BP GWO Completions
production grew another 2.8 million B/D in 2015, with the US accounting for 1 mil- Engineering
lion B/D of that. OPEC increased output by 1.6 million B/D last year, according to the BP Robello Samuel, Halliburton
report. Including crude oil, shale oil, and natural gas liquids, the US is the world’s larg- Otto L. Santos, Petrobras
est oil producer at 12.7 million B/D with Saudi Arabia second at 12 million B/D.
Luigi A. Saputelli, Frontender Corporation
Due to its cheaper price, oil’s share in the global fuel mix rose for the first time since
1999. Total global energy consumption rose 1%, weaker than its decade average of Sally A. Thomas, ConocoPhillips

1.9% per year, with coal the only major fuel in decline. Global oil production rose 3.2% Win Thornton, BP plc
while demand rose only 1.9%. Renewable energy was 2.8% of world energy consump- Xiuli Wang, Baker Hughes
tion, up from 0.8% a decade ago. JPT Mike Weatherl, Well Integrity, LLC

Rodney Wetzel, Chevron ETC

Scott Wilson, Ryder Scott Company

Jonathan Wylde, Clariant Oil Services

To contact JPT’s editor, email jdonnelly@spe.org.

12 JPT • JULY 2016

 GUEST EDITORIAL
Aiming for a Better Oil Price
Abdul Jaleel Al Khalifa, Chief Executive Officer, Dragon Oil
The debate among leaders in the oil and ects have been canceled or deferred.
gas industry originally was about the Many small- to medium-sized com-
longevity of the down cycle: Would it be panies have declared bankruptcy. Hun-
V-shaped or U-shaped, or would prices dreds of drilling rigs are stacked. Many
stay low for a longer period? When it students have decided to change their
became clear that lower prices were here major away from petroleum engineer-
to stay, the debate shifted to its impact. If ing. Shareholders, including investors
the down cycle is healthy and beneficial, and oil-producing countries, have lost
it should be allowed to take its course. trillions of dollars. Indeed, some gov-
But if it is seen as a tragedy, it should trig- ernments have approached the Interna-
ger urgent mitigation. tional Monetary Fund, World Bank, and
A down cycle is healthy, some believe, the bond market for rescue. This cycle
because commodity cycles are supply severely impacted unconventional, deep-
and demand driven. Down cycles trim the water, and other renewable resources.
fat, boost competition, and differentiate The petroleum industry has suffered an
those who are fit to survive. These are the immense loss, with far-reaching conse-
rules of the free market economy, lead- quences that likely will result in oil price
ing to cost efficiency, higher productiv- spikes in the future. This is a summary of
ity, and greater economic development. this camp’s position.
Emotions aside, the oil price is deter- In his classic book, The Origin of
mined by the equilibrium of supply and Wealth, Eric D. Beinhocker explained
demand, and the consequences of such the evolution of economics, strange-
cycles are realities that the industry must ly enough, by reviewing the basic laws
bear. After all, a free market economy is of thermodynamics. Economic theories
a package deal, and one should expect to were developed concurrently alongside
see casualties in this journey. The current the progress of laws of physics.
down cycle will not be the last, and the Traditional economies were based on
industry will keep going and continually the first law of thermodynamics (ener-
get healthier over the years. This is the gy is neither created nor destroyed).
opinion of this camp. This applies to a closed system where the
It is a tragedy, others believe, because boundaries of the system do not allow
so far approximately 350,000 employ- exchange of energy or matter with the
ees have lost their jobs and about outside. A good physical example is the
USD  350  billion worth of capital proj- whole universe. If applied to econom-
Abdul Jaleel Al Khalifa, SPE, has been chief executive officer of
Dragon Oil since May 2008 and an executive director on its board
of directors since September 2008. Al Khalifa has more than 25
years of leadership and technical experience. His technical skills
span exploration, reservoir characterization and development,
and well testing. Al Khalifa served as 2007 president of SPE. He
holds a doctorate in petroleum engineering from Stanford
University.
14
ics, it means that value is preserved and
can only be transformed. Resources are
transformed into goods and then into
utilities. In other words, wealth is trans-
formed but cannot be created. This law
states that supply and demand yield an
equilibrium sustainable price.
But this law assumes that people
behave rationally; that is, their decisions
are based solely on their self-economic
interest and not on ulterior motives such
as hatred or altruism. According to this
law, the balanced price between supply
and demand is equivalent to the cost of
goods or services that meets the demand
of the customers plus a reasonable mar-
gin of profit to make the business sus-
tainable. This also assumes that all play-
ers work under same circumstances.
But both the assumptions are not
valid. Suppliers are sometimes driven by
motives other than their self-economic
interest. In addition, suppliers may not
be working on a level playing field; listed
companies are often influenced by mar-
ket forces and, hence, pursue short-term
quarterly results, unlike national oil com-
panies that are able to better pursue long-
term strategic interests.
This shortcoming of traditional eco-
nomics gave birth to complexity econom-
ics, coinciding with the introduction of
the second law of thermodynamics: The
entropy of a closed system, which is a
measure of disorder, is always increasing.
Most systems are open, where boundar-
ies exchange energy or matter with the
outside, creating order inside but export-
ing entropy to the outside. A house is
an open system. While cooling is done
inside, heat and pollution are exported
outside. The economy is an open system,
a social system consisting of people, mat-
ter, energy, and information. It is an open
JPT • JULY 2016
 system where agents interact and gener-
ate continuous change.
The oil and gas market is an exam-
ple of an open system comprising many
open systems. It is a function of external
forces such as economic growth, politi-
cal tension, energy policies, and trends.
Within, there are many open systems at
work such as the physical market, futures
market, stock and inventories, and spare
capacity. Supply is not based entirely on
pure economic interest among all play-
ers so free market supply and demand
forces may not yield a sustainable equi-
librium price.
Historically, this market dynamic has
led to many attempts to regulate the
industry. The US Supreme Court broke
up the Standard Oil Company monop-
oly in the early 20th century. The Rail-
road Commission of Texas played a major
role in rationalizing oil production and
influencing oil prices between the 1930s
and 1960s. OPEC was intended to stabi-
lize crude prices, while the International
Energy Agency was formed to help con-
sumer countries.
Unfortunately, OPEC meetings since
late 2014 have not established a work-
ing mechanism to correct oil prices, and
the 2016 Doha meeting failed to freeze
oil output to boost prices. The decline
in rig counts, lower production from the
US, and the disruption of Nigerian and
Canadian supplies have nudged prices
higher, but they are still much below the
marginal cost needed to secure barrels
for future supply. This is not sustainable.
The deferral of capital projects will result
in a lack of global supply in just a few
years. Rigs, services, and people will not
be readily available to meet the next wave
of demand.
Market cycles can be categorized as
organic or inorganic depending on the
root causes. The root cause of the 1980s
down cycle came from within the indus-
try and therefore can be seen as organ-
ic. There was a clear structural change
in demand patterns and spare capacity
had swollen to more than 10 million bbl.
The short 2008 down cycle was inor-
ganic, since the root cause was the glob-
al financial crisis external to the indus-
try. The current cycle is a mix. There
was a huge increase in unconventional
supplies from North America, but glob-
al demand has continued to grow and
spare capacity is only 2–3 million bbl.
These internal industry fundamentals do
not lend themselves to an organic cycle.
Indeed, the limited spare capacity can be
wiped out quickly through political dis-
ruptions. But even if political stability is
secure, the deferral of capital projects
will accelerate natural decline, leaving
growth in demand to consume current
spare capacity.
The current cycle needs only the hearts
and minds of producers to meet, and the
price will immediately rebound as it has
no anchor to remain low. It is time produc-
ing countries agreed on a production ceil-
ing that will ensure a price of USD 60/bbl
by year end. That would be barely suf-
ficient to maintain existing producing
fields as well as fund some new develop-
ment projects that will ensure that the
global economy will continue to have an
affordable, sustainable supply of energy
resources in the near future. JPT

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 TECHNOLOGY APPLICATIONS
Chris Carpenter, JPT Technology Editor
Casing-Exit Software
and Consulting Service
The QuickCut Pro service from Weath-
erford enables reliable, precise
casing-exit operations by combin-
ing field-proven downhole tools, the
AccuView real-time downhole-data-
gathering system, and support from
experienced subject-matter experts
(Fig. 1). The QuickCut casing-exit sys-
tem offers operational flexibility with
multiple anchor options for either high-
or low-side casing exits, making it suited
for any type of casing in any environment
and for a wide range of operations. The
AccuView system securely captures and
transmits real-time data to the field oper-
ator on the rig floor and, simultaneously,
to Weatherford technical experts off-site
to facilitate a precise casing-exit angle
and placement through effective com-
munication. The system displays casing
exits on a foot-by-foot basis, similar to
directional-drilling software, there-
by improving accuracy and helping the
entire team to see the big picture. The
data-gathering system can also calcu-
late hypothetical scenarios on the basis
of real-time well data, such as rate of
Fig. 1—The QuickCut Pro service from Weatherford increases the probability of
a single-trip casing exit.
16
penetration, pressure, and flow rate,
which enables forecasting and compre-
hensive planning for any contingencies
before they happen, effectively manag-
ing risk for clients. The real-time com-
munication and consultation aspects
of the service bring together field and
support experience and expertise, pro-
viding reliability, shaving off nonpro-
ductive time, and reducing the num-
ber of milling trips. This service greatly
increases the probability of a single-trip
casing exit.
◗ For additional information, visit
www.weatherford.com.
Sensing System
Silixa has introduced Carina, a versa-
tile fiber-optic sensing system compris-
ing an advanced optoelectronics inter-
rogator and sensing cables, which are
equipped with the new family of engi-
neered Constellation fibers that gain
two orders of magnitude more sensi-
tivity over that achieved with standard
fibres. Applications such as borehole
seismic, well production profiling, pipe-
line leak detection, and perimeter secu-
rity have benefited from the inherent
nature of the technology, whereby a
standard optical fiber acts as a huge
sensor array. The Constellation fiber
is engineered to provide bright scatter
centers along its length to capture and
reflect more light back to the interro-
gator. This is achieved without intro-
ducing significant loss to the forward-
propagating laser pulses. It is possible to
achieve the massive coverage of distrib-
uted sensors without having to compro-
mise on sensitivity. This change in per-
formance is most acute in applications
with low acoustic-signal levels such as
leak detection and production monitor-
ing, where acoustic information can be
present at, or below, the inherent sys-
tem noise floor of the current technol-
ogy and therefore can be difficult to
detect. Borehole seismic applications
stand to benefit from greatly reduced
source effort required to achieve high-
quality, densely sampled seismic data,
leading to significantly reduced operat-
ing time and costs.
◗ For additional information, visit
www.silixa.com.
Knife Gate Valve
Victaulic introduced the Series 795
Knife Gate Valve, the industry’s first in-
line maintenance knife gate valve. The
new valve simplifies installation and
maintenance, reduces downtime, and
improves worker safety. The Series 795
Knife Gate Valve is ideal for fluid lines
containing solids or abrasive materi-
als common in wastewater treatment,
hydroelectric power generation, min-
ing, and other industrial settings with
applications such as lines for slurry and
tailings or cyclones. It alleviates a long-
standing industry challenge: the time-
consuming, labor-intensive process of
removing the entire valve from the pipe-
line to facilitate maintenance, rebuild-
ing, and repair. The new valve’s design
can reduce maintenance downtime by
up to 95% and generate up to 60%
savings in annual maintenance costs
(Fig. 2). Victaulic developed technology
JPT • JULY 2016

Fig. 2—Victaulic’s
Series 795 Knife
Gate Valve.
that encloses all wear parts into a single
seat cartridge kit, which greatly sim-
plifies maintenance. The design allows
the valve to remain installed through
ongoing maintenance cycles. One Mon-
tana mining company beta-testing the
Series 795 saw maintenance that once
required hours of downtime reduced to
minutes. The new valve also improves
worker safety because only one compo-
nent has to be replaced, vs. removing
the entire valve from the pipeline. This
design eliminates the need for rigging
Fig. 3—ThinJack’s PowerPad hydraulically inflatable steel envelope.
JPT • JULY 2016
with heavy chains and pulleys swinging
over the heads of maintenance crews.
◗ For additional information, visit
www.victaulicknifegate.com.
Cutting-Operations
Steel Envelope
Building on the field-proven ThinJack
technology of safe, fast, rigless sepa-
ration of seized well flanges, the com-
pany’s research and development efforts
have resulted in PowerPad—the first
hydraulically inflatable, millimetric-
thin steel envelope for supporting and
maintaining the height of the gap dur-
ing a cutting operation (Fig. 3). This
pad prevents objects from collapsing in
on the cut gap and trapping and break-
ing the diamond wire, thereby caus-
ing delays, and meets a need to deliver
productivity in engineering safe asset-
reduction techniques in the decommis-
sioning sector. It permits faster and
safer operations cutting through con-
crete assets and, with the addition of
sensors and software, can also be used
either simultaneously or consecutively
to determine the weight, load require-
ments, and center of gravity of heavy
items being removed. With the capa-
bility to calculate the center of gravity
before the lift of the upper, cut-off part
of the asset, PowerPad permits widen-
ing the range of vessels that may be used
for topside disconnection and thereby
can contribute toward decreasing costs,
with a range of structure sizes.
◗ For additional information, visit
www.thinjack.co.uk.
Wellhead Outlet
Downhole monitoring equipment is
changing; new power requirements exist
and more well data are being transmit-
ted to the surface, and multiconductor
cables are becoming increasingly preva-
lent to serve this equipment. The 7-Pin
I-Wire Penetrator System smart-well
feedthrough from ITT BIW is the first
wellhead penetrator that offers up to
seven contacts to serve multiwire cables
(Fig. 4). These electrical outlets are usu-
ally placed on top of the wellhead bonnet
and serve as a seal to connect downhole
monitoring equipment to the surface.
The cables are connected at both ends
of the pressure barrier, allowing for
safe transmission of electric power to
the downhole gauges, and data from the
equipment back to the surface to aid in
well management. With the smart-well
feedthrough, customers now will be able
to connect their most advanced monitor-
ing equipment without having to perform
complicated workovers on the cabling,
which involves maintenance costs and
potential safety tradeoffs. This is a prod-
uct that wellhead operators will want to
use because it covers their pressing need
for an electric infrastructure that can
handle greater data transmission,
allowing them to manage
their ˆwells ˆin
a smarter
way.
Fig. 4—The 7-Pin
I-Wire Penetrator
System smart-well
feedthrough from
ITT BIW.
17

Fig. 5—Baker Hughes’ DrillThru solution offers a customized approach to
overcoming trouble-zone challenges.
Additionally, this new outlet incorpo-
rates a safety indicator that provides a
visual warning if high pressure is detect-
ed within the outlet housing, preventing
disassembly in unsafe conditions.
◗ For additional information, visit
www.ittbiw.com.
Trouble-Zone Drilling Solution
Operators are looking to extend the prof-
itable life of their fields, which often
requires drilling through problemat-
ic environments, or trouble zones. To
enable safe, efficient, and economi-
cal drilling through these zones, Baker
Hughes introduced the DrillThru solu-
tion, which offers a proven, comprehen-
sive work flow to overcome the challenges
associated with trouble zones. The work-
flow process starts with gathering and
contextualizing reservoir and field data
so that all potential threats are identi-
fied and interpreted through geomechan-
ical models (Fig. 5). The service com-
pany then designs a customized well path
and a detailed plan to construct the well
through any potential trouble zones. Each
solution prescribes the most-appropriate
remedies for addressing identified trou-
ble zones. In one recent application, the
company designed and implemented a
solution in the North Sea for an operator
that needed to accommodate an unstable
shale formation protruding into the pay
zone. The service company developed
a solution that could capture additional
reserves without risking wellbore integ-
rity. A steerable drilling liner was com-
bined with careful fluid management to
directionally drill through the unstable
18
shale. Drilling and laying liner simulta-
neously prevented the wellbore from col-
lapsing, and enabled access to previously
bypassed reserves. This solution deliv-
ered an additional 758 ft of pay-zone con-
tact, boosting recovery by an estimated
350,000 bbl of oil.
◗ For additional information, visit
www.bakerhughes.com.
Artificial-Lift System
A new technology from Production Plus
Energy Services offers a solution for oper-
ators to reduce lifting costs and increase
production in horizontal wells. The Hor-
izontal Enhanced Artificial Lift System,
or HEAL System, complements existing
artificial-lift systems, settling the messi-
ness of horizontal flow, reducing fluid
density, and lifting fluids higher in the
vertical section where a pump can operate
most reliably. Sluggy, inconsistent flow
in horizontal wells means poor run time,
excessive workover costs, and inadequate
drawdown. The HEAL System delivers
smooth flow to the pump that is placed
shallower in the vertical section, to allow
the pump to work more reliably and effi-
ciently, ultimately reducing operating and
capital costs while enhancing production
(Fig.  6). Suitable for both existing and
new wells, HEAL allows natural flow dur-
ing the early part of the life cycle, and
then integrates, with minimal expense,
into artificial-lift systems once they are
required. For some operations, the HEAL
System can fill the lifting gap and elimi-
nate the need for intermediate lift sys-
tems such as gas lift. Operators who have
installed the HEAL System have experi-
HEAL Vortex
Separator
HEAL
Seal
Fig. 6—The HEAL System from
Production Plus Energy Services.
enced a material improvement in produc-
tion and reserves, on the order of 30% or
more, over the remaining life of the well.
◗ For additional information, visit
www.pdnplus.com.
Injection and Fracturing Valve
GEODynamics introduced its QuickStart
Inject and Frac Valve product line. The
results of field testing yielded complete
successful toe-stage openings in more than
120 wells in the United States. The Quick-
Start Inject and Frac Valve is the value
offering within GEODynamics’ broader
patented SmartStart Plus Time Delay Test
and Frac product line. The reliability of
the QuickStart Valves and SmartStart Plus
are the result of extensive engineering-
development efforts and patented TORQ
Thru and Port Jetting technology. Opera-
tors have reported that QuickStart valves
using Port Jetting technology have great-
ly improved their ability to inject into the
toe stage of their wells. The SmartStart
Plus product line allows customers to meet
the most stringent regulatory and safe-
ty test requirements, while in the current
challenging economic environment, the
QuickStart Inject and Frac Valve reduces
cost, increases reliability, improves safety,
and maximizes toe-stage injectivity. Quick-
Start Valves are the best option for opera-
tors currently using standard toe valves
and seeking to improve injection rates and
efficiency at the well site. The Port Jetting
technology has been proven in thousands
of wells as a superior technique to achieve
connection with the formation. JPT
◗ For additional information, visit
www.perf.com.
JPT • JULY 2016
 Is your company
developing a
brilliant new
Brilliance can technology?
change life Showcase it to the industry
at ATCE in Dubai on the
as we know it. exhibit floor theater.
Demonstrate your commitment to the
groundbreaking technologies your company
is developing for the E&P industry. Be an
ENGenious presenter or sponsor at the
Annual Technical Conference and Exhibition
(ATCE) in Dubai, 26–28 September 2016.

Be a Presenter
• Showcase your new technology in
the ENGenious Theater
• Present new technology to a well-
qualified audience cost effectively
• If your technology is selected as the
“Best Overall” it will be featured in a
future issue of JPT!
To get involved as a presenter, contact
Sylvia Ansara at sansara@spe.org

Be a Sponsor
Is your company a leader in E&P technology?
Demonstrate your leadership position
by becoming a sponsor of ENGenious, the
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For more information, visit
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ENGenious is brought to you by the Journal of

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attendees will be welcome to visit the JPT Young
Technology Showcase and see the presentations.

Nikola Tesla
 TECHNOLOGY UPDATE
New Tool and Sealant Technology
Expedites Annular Isolation Tasks
Bengt Gunnarsson, SPE, Sven Harald Tønnesen, and Eugen Olsen, CannSeal, and Yuting Leong, SPE, Maersk Oil
Annular isolation issues are frequently
discussed in well asset forums worldwide
with a focus on improved oil recovery/
enhanced oil recovery applications or
annular well integrity challenges. Con-
ventional methods to repair annular iso-
lation typically involve coiled tubing (CT)
operations or heavy workovers, where it
is necessary to pull the well tubing. These
are high-cost procedures that are some-
times deferred.
We discuss herein the CannSeal tech-
nology, a well intervention tool that con-
veys and accurately places a proprietary
epoxy sealant into an annulus at a pre-
defined location in the well. The tech-
nology enables a level of precision in the
placement of annular sealant that has not
previously been possible. Considerable
savings in rig time can be achieved, com-
pared with alternative methods.
Operators can use the technology to
isolate and improve the response to res-
ervoir issues such as high water cuts and
thief zones and efficiently repair and
re-establish well barriers. As a result,
well recompletions can be postponed
or avoided.
The results of a field trial are included
in this discussion.
The Technology
The technology was patented in 2005,
following a joint industry project between
Fig. 1—Injected sealant forms an annular isolation barrier.
Images courtesy of CannSeal.
20
Shell, Statoil, Eni, Total, and the Research
Council of Norway. A field trial was per-
formed in 2012 with Shell Appalachian in
Pennsylvania (United States) with partial
success, but revealed the need for further
design improvements. ConocoPhillips,
Maersk Oil, and BP contributed financial-
ly to support considerable reengineering
and rigorous testing. Eventually, Maersk
and BP spent resources on the final tool
qualification processes to ensure that the
equipment was ready for downhole oper-
ations. In late 2015, the tool was suc-
cessfully run at Maersk’s Halfdan field
in Denmark.
The technology concept consists of
an electrical-wireline- or electrical-CT-
(e-CT-) operated tool that incorporates
the epoxy sealant. The sealant is pre-
mixed in the workshop and transferred
to a steel container/canister within the
tool assembly.
The tool incorporates an advanced
telemetry communication system that
provides the tool operator at the surface
full control of
◗ Position, using the integrated casing
collar locator (CCL)
◗ All tool functions
◗ Perforation
◗ Pumped sealant volume
◗ Sealant injection rate and pressure
◗ Tool and well pressures and
temperatures
Fig. 2—An example is shown of isolation plugs placed on
either side of a connection.
◗ Emergency release features
When located at the precise target
depth in the well, a three-hole perfora-
tion process is activated, which allows
access to the entire circumference of the
annulus. The sealant is injected and dis-
placed exclusively into the annulus in a
single operation without sealant spilling
into the tubing (Fig. 1). The sealant will
also seal the perforated holes without the
subsequent need for patching. If the seal-
ant is injected into a cement matrix for
microannulus repair, a pumping differ-
ential pressure of 200 bar is achievable.
The proprietary sealant is designed
with rheology properties that allow it
to be injected into an open/cased-hole
annulus with possible crossflow of water
or into a gravel pack or cement matrix.
The epoxy plug solidifies under well tem-
perature conditions.
Prefield-Trial Testing
Maersk and CannSeal have collaborated
closely since 2011 to establish acceptance
criteria for the proprietary epoxy sealant
and tool parameters to match those of
downhole operations in the Halfdan field.
Halfdan injection wells are completed
with long horizontal CAJ (controlled acid
jetting) liners with no cement or prein-
stalled annular isolation devices. In some
wells, stimulation or water injection has
unintentionally caused direct connec-
JPT • JULY 2016
tions to neighboring wells. These become
thief zones that allow direct communica-
tion between the injector and the produc-
er. In the areas planned for annular plug
placements, potential crossflow was con-
sidered an issue. So one of the first tests
was to verify that the epoxy sealant would
stay in place during the injection.
The test setup included an annular
cell of 7-in. outer-diameter pipe inside
a 9.5-in. inner-diameter (ID) pipe. The
setup was capable of allowing a water
crossflow rate of up to 330 B/D with
a maximum differential pressure of
0.2 bar. Under crossflow conditions, the
sealant was successfully injected into the
annulus to shut off the crossflow. The test
proved the annular isolation concept by
using a highly viscous epoxy paste.
More than 100 operating hours of tool
testing were performed in a horizontal
pressure and temperature (P&T) cell in
relevant well conditions. The next step
was to repeat the same operation in the
CannSeal vertical test well (40 m deep)
with full pressure and temperature integ-
rity. In addition, the complete tool sys-
tem was run in the Altus Well Academy
test well to acquire operational training
and experience, and to ensure that the
tool could be run in combination with
the Altus well tractor (although it was not
used in the Halfdan operation). This test-
ing also included emergency release of the
tool with subsequent successful fishing.
The final test before releasing the tool
for operational use was to build an annu-
lar cell with the same wellbore geometry
as the Halfdan well set for intervention.
The annular cell was integrated with the
horizontal P&T test cell. The tool, which
included a 14-m sealant canister (70 L
epoxy), was installed inside the test cell.
The cell was filled with water and heat-
ed to 80°C, at a constant pressure of
100  bar, before the sealant was injected
into the annular cell.
Field Trial
The overall objective for the Halfdan well
operation was to isolate a fracture thief
connection in a water injector, which had
short-circuited the injection stream to
a producing well. This article does not
describe all the diagnostic work required
by Maersk before the operation, but in
JPT • JULY 2016
general terms describes the CannSeal
portion of the operation. When perform-
ing the risk assessment during the late
planning phase, it was decided to use
e-CT instead of a well tractor because of
the poor liner condition.
In addition to revealing the condition
of the CAJ liner, the diagnostic work pro-
vided potential location information for
possible annular placement of the plugs
on either side of the fracture connection.
The operation comprised the follow-
ing steps.
◗ Diagnostic work such as distributed
temperature surveying, production
logging, water flow logging, and
caliper applications
◗ Installation of the CannSeal plugs
◗ Straddling the CannSeal plugs with
CoilFlate1 packers and pumping of
ThermaSet2 through CT into the
fracture connection. The CannSeal
plugs served as a base/foundation to
channel the conformance material
(ThermaSet) into the fracture
◗ Removing the upper packer, milling
residual ThermaSet in the liner, and
removing the lower packer
◗ Surveillance to confirm the results
of the conformance operation
The operation was given a high focus
by Maersk during the planning phase,
as this was the world’s first conformance
treatment of this type. Engineers from all
parties involved took part in the evalua-
tion of plans and designs, testing, qualifi-
cation, program writing, risk assessment
analyses, and coordination of the inter-
face between personnel and equipment.
For the operation, CannSeal mobi-
lized six epoxy canisters, each of which
were filled with 70 L of epoxy. For an in-
gauge 8.5-in.-ID wellbore, 70 L of epoxy
would have created a 6-m plug. How-
ever, because the well was stimulated
with acid, the actual ID of the wellbore
was unknown. To allow for the uncertain-
ty, plugs were placed on either side of the
connection (Fig. 2).
With the complexity of the operation,
using new technology and expecting the
CAJ liner to be in poor condition, it was
decided to execute an initial dummy run
into the well for the trial and testing of the
equipment in hole. The main objectives of
the dummy run were to
◗
Acquire operational experience
without time constraint, as no epoxy
was used
◗ Obtain an understanding of run-in-
hole time to total depth (TD), using
e-CT
◗ Acquire well temperature readings
with the tool as a baseline for
the pot life of the sealant over
consecutive runs
◗ Obtain a correlation sequence using
new downhole tools (the integrated
CCL and a CT compensation-sub)
◗ To set the injection pads and
conduct pressure testing against the
liner wall at several locations to help
determine the best spots for plug
placement
For the entire operation, nine runs to
TD were performed. Three runs were
made to get an understanding of the
well and liner condition, three runs were
related to challenges with the CannSeal
perforation system, and three runs were
made to perform the needed operations.
The perforation issues were related to a
challenging space limitation in the perfo-
ration assembly and poor assembly pro-
cedures in loading the guns offshore.
These issues were clarified offshore in
close dialog with onshore expert teams.
The final three runs were per-
formed successfully, which resulted in
one plug set downstream of the frac-
ture connection and two upstream of the
fracture connection.
During placement of all three plugs,
accurate injection pressures, epoxy flow
rates, and other tool readings were mon-
itored (in real time), making it user-
friendly for Maersk and CannSeal to
observe the critical injection period. With
an average injection rate of 0.5 L/min,
injection and placement of each plug
took about 2 hours. The entire operation,
including tool string makeup, running in
hole, preparing for and placing the plug,
pulling out of hole, and tool string break-
down, took about 24 hours per plug.
The operation was considered a success
by Maersk, and future applications of the
annular isolation technology could hold
significant value for the industry. JPT
1A Schlumberger technology.
2A WellCem product.
21
 YOUNG TECHNOLOGY SHOWCASE

Top-Down Modeling: A Shift in Building

Full-Field Models for Mature Fields
Shahab D. Mohaghegh, Intelligent Solutions

Description of the Technology
Models are needed to develop and oper-
ate petroleum reservoirs efficiently. Data-
driven reservoir modeling [(also known
as top-down modeling (TDM)] is an
alternative or a complement to numerical
simulation. TDM uses the so-called “big-
data” solution (machine learning and
data mining) to develop (train, calibrate,
and validate) full-field reservoir models
on the basis of measurements rather than
solutions of governing equations.
Unlike other empirical technologies
that forecast production, or only use pro-
duction or injection data for its analysis,
TDM integrates all available field mea-
surements (well locations and trajectories,
completions, stimulations, well logs, core
Water Saturation (%)
data, well tests, seismic, and production/
injection history—e.g., choke settings)
into a full-field reservoir model by use of
artificial-intelligence technologies. Intel-
ligent Solutions, as the inventor of TDM,
has recently released software application
“IMagine” for TDM development.
TDM is a full-field model wherein pro-
duction [including gas/oil ratio (GOR)
and water cut] is conditioned to all mea-
sured reservoir characteristics and oper-
ational constraints. TDM matches the
historical production and is validated
through blind history matching, and it
is capable of forecasting a field’s future
behavior on a well-by-well basis.
The novelty of TDM stems from the
fact that it is a complete departure from
traditional approaches to reservoir mod-
eling. In this new paradigm, current
understanding of physics and geology is
substituted with field measurements as
the foundation of the model. This char-
acteristic of TDM makes it a viable mod-
eling technology for unconventional
assets, where the physics of hydrocarbon
production is not well-understood.
Role of Physics and Geology
First-principles physics of fluid flow is
not formulated explicitly within TDM,
but forms the framework for the assim-
ilation of the spatiotemporal database
as its foundation. TDM is built by cor-
relating flow rate at each well/timestep
to a set of measured static and dynam-
ic variables. Static variables (such as
porosity, thickness, initial water satura-

80
70
TDM Field Measurements
tion, and formation top) are considered
60
50 History Match Blind Forecast as follows:
40
Sw History Match ◗ At and around the well
30 ◗ The average from the drainage area
20
10 of the offset producers and injectors
4 ◗ The average from the drainage area
Static Pressure (psi)

PR The dynamic variables are considered

3.5
at appropriate timesteps:
3 ◗ Wellhead pressure or choke size at
timestep t
2.5
◗ Completion modification (inflow-
2 control valve and squeeze-off) at
3
qo timestep t
Oil Rate (bbl/yr)

2.5
◗ Days of production at timestep t
2
1.5 ◗ GOR, water cut, and oil production
1 of the well at timestep t and for the
0.5 offsets at timestep t–1
0 ◗ All injections at timestep t
Dec-73 May-79 Nov-84 May-90 Oct-95 Apr-01 Oct-06 Apr-12 Sep-17 The data incorporated into TDM
Time (Date) demonstrate its distinction from other
empirically formulated models. Once the
Fig. 1—TDM history match, blind simultaneous history match, and forecasting
for Well #C0x41 for time-lapse water saturation (top), static reservoir pressure development of the TDM is completed,
(middle), and oil production (bottom). Red squares in all three plots indicate its deployment in forecast mode is com-
field measurements, while lines indicate TDM results. putationally efficient (running in sec-

22 JPT • JULY 2016

 1980 1990 2000 2010
Fig. 2—Map of water saturation (blue is Sw=1.0) as a function of time in Unit A. All measured values of water saturation
throughout the history of the field are honored in this map. Where and when field-measurement values were not
available, TDM results have been substituted at the well locations and then geostatistics have been used to populate
the map.

onds). The small computational footprint
makes TDM an effective tool for reser-
voir management, uncertainty quantifi-
cation, and field-development planning.
Development and deployment costs of
TDM are a small fraction of the cost of
numerical simulation.
Other Considerations
TDM can accurately model a mature
field and forecast its future produc-
tion behavior successfully (Fig. 1). Its
deliverables include forecast of oil pro-
duction, GOR and water cut of exist-
ing wells, location of sweet spots, field-
development planning, and in-fill drilling.
When TDM is used to identify the commu-
nication between wells, it generates a map
of reservoir conductivity that is defined
as a composite variable that includes mul-
tiple geologic features and rock charac-
teristics contributing to flow in the res-
ervoir (Fig. 2). This is accomplished by
deconvolving the effect of operation-
al issues from reservoir characteristics
on production.
TDM is applicable to fields with a
certain amount of production history
as long as the physics of the flow does
not change dramatically. It needs to
be updated (retrained) with new mea-
surements that reflect the new fluid-
displacement mechanism. JPT

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 E&P NOTES
Small Bubbles, Big Rewards for Separation
Technology
Trent Jacobs, JPT Senior Technology Writer
Reminiscent of the song made famous
by late Hawaiian crooner Don Ho, tiny
bubbles are the focal point of a new inno-
vation aimed at transforming produced
water from a costly byproduct into a
valuable asset.
Termed nanobubbles, they are sever-
al times smaller than a human red blood
cell, which allows them to play with the
physics of how dissolved gas interacts
with liquids, according to Nano Gas Tech-
nologies. The suburban Chicago-based
startup says its technology is capable of
cheaply producing these nanobubbles to
treat produced wastewater that is among
the “worst of the worst.”
The technology works by pushing gas,
either oxygen or nitrogen, through a noz-
zle head that shoots the tiny bubbles into
a treatment tank. The result is what the
company’s chief executive officer, Len
A nanobubble-based wastewater treatment system operating for Permian
Disposal Services in Texas. The system’s developer says it is treating about
11,000 B/D day of produced water and enabling the operator to recover
nearly all of the 2–3% of oil (by volume) that is mixed in with the water.
Photo courtesy of Nano Gas Technologies.
24
Bland, calls “fluffy water” that causes
suspended solids to fall and oil to float
to the top where it is easily skimmed off.
“If you want to put it in technical
terms,” he said, “we change the specific
gravity of the liquid so that it enables the
oil that is stuck in the water to rise.”
Bland went on to explain that because
the bubbles are so small, significantly
higher levels of dissolved gas in water can
be achieved than under normal temper-
atures and pressures. For instance, tap
water tends to have a dissolved oxygen
concentration of about 5 ppm. Nano Gas
says its technology generates concentra-
tions more than 10 times that figure.
Founded in 2013, the company is hop-
ing the industry will take notice of its first
unit that it began operating last year for
a disposal well company in the Permian
Basin town of Seminole, Texas.
“This stuff is just sludge,” Bland said
of the produced water quality being pro-
cessed at the site that is mostly coming
from the bottom of settling tanks and
the washout from trucks used to haul the
water to and fro.
Before it is run through the nanobub-
ble system, the water has already been
through multiple conventional separa-
tion processes but “at the end of the
day, they still have this dirty water that
they are putting into their disposal
well, potentially clogging up that well,”
Bland said.
He noted that despite such problems,
injecting produced water deep under-
ground is still the most affordable option
for nearly every operator around the
world. But the company believes its sys-
tem makes water handling cheaper, and
possibly profitable, by enabling com-
panies to recover the oil that typically
represents 0.5% to 3% of injected fluids.
The company designed its business
model to introduce as little risk to the
client as possible. Instead of charging
a per barrel fee, renting, or selling the
equipment as many other treatment ser-
vices do, the company retains ownership
of its system and makes money by split-
ting the sales of the recovered oil with the
disposal well operator.
After processing, any revenue derived
from the sale of the treated water is also
shared. Bland said the end product is of
a good enough quality that it can be sold
back to an oil company that may be look-
ing to reduce the amount of fresh water
used in hydraulic fracturing.
Because many oil producers operate
a sizeable portion of their own disposal
wells, Nano Gas believes the payoff would
be substantially greater for them since
they could recover more of their own oil
JPT • JULY 2016
 √ Zonal isolation √ Well Integrity √ Support to P&A

3D & Layout: Render.no

Place your annular plug in
a single wireline operation

cannseal.com
A norwegian based technology company
 and not have to pay a third party for the
recycled water.
The company reports that it has suc-
cessfully clarified tank bottom water
without any upfront treatment pro-
cesses. Such demonstrations are hoped
to show that the technology can work
under nearly any circumstances and that
capital costs can be further reduced by
eliminating the need for equipment such
as  heater-treaters, centrifuges, and set-
tling tanks.
The company also says that when
oxygen-nanobubbles are injected into
produced water, a chemical reaction
takes place that knocks out hydrogen sul-
fide (H2S), a toxic chemical that is so cor-
rosive it easily eats through thick steel.
The oxygen also acts as a biocide, killing
harmful bacteria that could cause further
downhole damage.
Search for Flight MH 370 Shows Durability of AUVs
Trent Jacobs, JPT Senior Technology Writer
The unprecedented search effort for
Malaysian Airlines flight 370 has yet
to achieve its main goal of locating the
vanished aircraft and the 227 persons
on board. However, it has served as an
endurance test of sorts for offshore sur-
veying systems such as the autonomous
underwater vehicle (AUV), which just a
couple of years ago was considered an
emerging technology with a small track
record. Edward Saade, president of the
ocean surveying firm Fugro Pelagos, the
company contracted by the Australian
government to carry out much of the
search operation, said he knows of no
other commercial project where AUVs
have been successfully deployed for such
an extensive period of time.
Speaking at the 2016 Offshore Tech-
nology Conference in Houston, Saade
said that to cover large swaths of sub-
sea terrain as quickly as possible and
capture high-resolution data, Fugro first
deployed vessels equipped with conven-
tional deep-tow side scanning sonar.
Then starting in January of last year, the
AUV vessel was deployed from Perth.
“The purpose of the AUV was to try
and get into all those areas that turned
26
But because oxygen is itself corro-
sive, nanobubbles containing nitrogen
gas are introduced into the treated pro-
duced water to displace the oxygen-
containing nanobubbles. The final prod-
uct is a nonreactive water that could
help extend the lifespan of disposal wells
prone to skin and plugging issues caused
by the extremely poor quality of the
injected fluids.
The nitrogen-infused water could also
be beneficial to waterflooding opera-
tions since the gas is known for reduc-
ing the interfacial tension of residual
oil trapped in mature reservoirs. Build-
ing on this advantage, the company
claims its nanobubbles are long-lasting.
This characteristic not only keeps oil
and water separated for weeks, but
in a waterflood scenario, the nitrified
bubbles should also remain intact and
out to be blocked in the side-scan opera-
tion, either by the steep slopes or other
types of data anomalies,” Saade said.
“We would preprogram the AUV, launch
it and it would do its thing for about
24–28 hours and very effectively fill in all
the gaps.”
In the future, he suggested that it may
be possible to use a larger number of
AUVs and deploy them from multiple
points to carry out such large surveys.
But the limits of today’s AUV technology
meant covering the 120,000 km3 of Indi-
an Ocean that make up the search area—
roughly the size of New Zealand—would
have taken about a decade.
“I have completely bought in to the
AUV approach,” Saade said. “So going to
a deep-tow approach almost seemed like
a step backward, but it turned out to be
the exact right approach for something
on this massive scale.”
The AUV that Fugro used in the proj-
ect is the Kongsberg-Hugin 100 model,
which was selected because of its techno-
logical abilities, and since there are many
in production, replacements or spare
parts would be readily available. The sen-
sors on both the AUV and the deep-tow
exposed to the formation long after the
initial treatment.
The microscopic size of the nanobub-
bles gives them stability and an average
half-life of 15 days—meaning that after
that period, half of the bubbles remain
intact and in solution. Large bubbles,
such as those generated by other water
treatment and separation technologies,
tend to burst in seconds which Bland said
wastes up to 90% of the energy and gas
used to create them. Nano Gas believes
that its bubbles are two orders of magni-
tude smaller than what anyone else in the
oil and gas industry uses.
The company’s research found at least
50 other industries that might bene-
fit from nanobubbles, including waste-
water treatment and poultry farming—
the oxygenated water may help chickens
grow faster.
units were the same, which allowed the
data to be seamlessly integrated.
Saade discussed many other details of
the search effort which has taken place in
one of the most remote and unexplored
areas of the planet.
He said the initial seabed survey
revealed that the actual water depths in
some areas were more than a mile shal-
lower than what existing ocean maps
suggested. This proved to be a criti-
cal data point in helping Fugro select
which sensors to use and it also meant
the operations would be a little easier
to perform.
When investigators turned to Austra-
lian satellite operators to look for any
sign that the aircraft’s communications
system sent locating information up to
space, the companies all said that they
use the area in question for downtime
and maintenance.
And despite the “hellacious seas” that
are common during the winter months
in this part of the Indian Ocean, Saade
noted that the project has incurred very
little downtime, most of which was
due to crew illnesses and not equip-
ment failure. JPT
JPT • JULY 2016

CONFERENCE REVIEW
BREAKING
From the Norm
To Reach Marginal
Offshore Fields
Trent Jacobs, JPT Senior Technology Writer
O
ne could argue that now is not
the time to discuss how mar-
ginal or stranded offshore fields
can be effectively monetized. After all,
even in the good times the offshore sec-
tor showed that it had little appetite for
small-scale developments; their risk-
reward ratio is usually not viewed as
worth the effort.
On the other hand, going big has not
exactly worked out for the offshore sec-
tor in recent years. Too many headline
projects have suffered major cost over-
runs or missed production targets.
And thanks to low oil prices, most
of the recently completed projects that
managed to stay on budget are now oper-
ating at a significant loss. On top of all
that, the number of commercially viable
offshore discoveries has been shrinking
each of the past few years.
JPT • JULY 2016
As the challenges continue to mount,
a number of technology developers are
hoping to rewrite the offshore playbook.
Much of their work is focused on devel-
oping cheap ways to access the mar-
ginal assets that often lie just beyond
the reach of existing facilities. Some of
the more radical ideas involve devel-
oping futuristic and nimble technolo-
gies that could drastically reduce the
physical capital required for green-
field projects.
A company in Norway thinks it can do
this by drilling record-long wells from
aging platforms for a fraction of the
cost it takes to use floating rigs or sub-
sea production systems. Another Nor-
wegian-born firm is working on a stand-
alone drilling robot that will burrow
thousands of feet into the subsurface
where it will appraise a prospective res-
The last few years of offshore
megaprojects have produced
some of the worst margins in
the oil and gas industry. To
achieve long-term profitability
in the subsea world, some argue
that oil companies must begin
thinking smaller.
ervoir and then monitor it for several
years afterward.
Others are pushing for simpler solu-
tions that have less to do with emerging
technology and instead center on per-
suading oil companies to change how
they develop their subsea properties.
Among them is a call to build deepwater
floating facilities with spare capacity to
handle unplanned field expansions. A
proposal for shallow water argues that
operators should use fixed-leg platforms
that can be floated away and reused in
multiple fields.
While these ideas do not answer all of
the problems facing the offshore sector,
nor do they apply to every type of field,
they address the primary sources for spi-
raling costs. Using far less steel and far
fewer people could allow subsea assets to
start delivering positive earnings.
27
 Going Longer For Less
It sounds counterintuitive, especially
for those familiar with how expensive
offshore wells can be, but one way to
save money might be to drill the world’s
longest wells. This “Long Reach Well
Concept” involves drilling wells up to
30  km long (18.5 miles), about twice
the length of the current record-holding
wells drilled by ExxonMobil offshore
Sakhalin Island, Russia.
The idea was presented at the recent
SPE/IADC Drilling Conference and Exhi-
bition in Fort Worth, Texas by the Inter-
national Research Institute of Stavanger
(IRIS), whose researchers are develop-
ing the remaining bits of technology
needed to carry out such an extended
drilling operation.
The system is being designed to use
technology from existing offshore plat-
forms and target otherwise stranded
reservoirs. Sigmund Stokka, a research
director at IRIS, said this approach
might be a quarter of the cost required
for a floating rig and about a third the
cost of a subsea production spread.
The investment requirements for a
long-reach well are further reduced if
an existing well can be used to get a
head start. “The first phase is just to
make a well longer—start with a well
that is 10 km and make it 10 km longer,”
Stokka explained.
Tripping in and out of the well is
not an option because of the distances
24½-in.-Casing diameter
20 in.
14 in.
0 1000 2000 3000 4000
In one drilling scenario, researchers see an opportunity to extend a lateral well from its pre-existing depth to access
virgin reservoirs just beyond the horizon. Graphic courtesy of the International Research Institute of Stavanger.
28
involved, which means the entire drill-
ing operation is a one-way journey to
the pay zone. Hence the name of the
startup company IRIS spun off to com-
mercialize the technology, Hole-in-
One Producer.
Stokka said the ambitious project’s
paramount objective is to achieve a very
high level of reliability. “That’s the chal-
lenge,” he said. “We can’t take it out, and
it needs to be reliable enough to com-
plete the whole well.”
Completion-while-drilling technolo-
gies are a must have. Each component—
and there are many on a well this long—
must work together as a system. They
must also work for extended periods
since the entire operation could take
weeks to complete. Stokka said that the
rate of penetration is expected to be
between 5 m and 10 m per hour.
Though this is a snail’s pace com-
pared with conventional drilling prac-
tices, the slow drilling will reduce the
vibrations that cause wear and tear on
downhole assemblies. It will also allow
for a single, yet robust, bit to be used
to drill the entire well length. Stokka
described it as “more like machining”
than drilling.
And in more ways than one, the
long-reach concept is a perfect fit
for automated drilling technologies.
Because the operation is methodical-
ly paced, pipe handling could easily be
done by a robot. Automated systems
9⅝ in. (10¾ in.)
5000 6000 7000 8000
Lateral Length (meters)
to control managed pressure drilling
and continuous circulation will also
be needed.
The technologies listed above are rel-
atively proven and will not require much
more maturation to apply in the long-
reach scenario. However, there remains
one big piece of technology that needs
more work: the tractor system made
up of 200 expandable rubber packers
that will move the extra-long drillstring
through the wellbore.
Located at 100-m to 150-m intervals,
the packers will move like a caterpillar,
pulling and pushing the entire string
along one meter or two at a time. Con-
trolled by a computer, the packers will
allow for stable drilling by expanding
and locking into position.
As the drill bit moves forward, the
packers will retract and also move for-
ward with the help of a piston-like
hydroelectric mechanism conjoined to
each packer unit. This process is repeat-
ed over and over again until the well
reaches its target.
Made from pure rubber, the packers
have been tested to verify that they can
expand and retract hundreds of times
without failure. They will also pull dou-
ble duty as the well’s primary zonal iso-
lation element, eliminating the need to
cement the well. The next steps for the
project are focused on proving that the
packer-tractor system will work in the
real world.
0
500
Depth (meters)
1000
1500
2000
2500
3000
9000 10000 11000 12000
JPT • JULY 2016
 The drill bit of a prototype drilling
system that is designed to complete
a one-way journey into hydrocarbon-
bearing formations. Photo courtesy of
Badger Explorer.

As it drills to the target depth, the

drill cuttings are to be moved through
the inside of the tool. When the cuttings
reach the top end of the tool they will
be pressed tightly by a compaction unit.
This should seal the borehole to pro-
vide wellbore stability and isolation as
required by environmental regulations.
Tests run on a traction unit prototype (top) have shown that the necessary Larsen said the company believes
friction to provide wellbore stability and zonal isolation can be achieved. the Badger will also enable a new way
Researchers have also tested a PDC drill bit (bottom) to verify that the traction to conduct seismic surveys. By using
system provided enough weight-on-bit and torque to move through cement.
some of the tools as the seismic source,
Photos courtesy of the International Research Institute of Stavanger.
and others as the receiver, he said com-
panies could get an unprecedented
Badger Explorer nating most of the capital needed to drill cross-view of the formation that would
Another IRIS spinoff company founded an exploration well. be unaffected by the distortions created
about a decade ago, Badger Explorer, is “With the Badger, you would be able by the sea and the seabed during con-
working on a much different technology to drill many more exploration wells for ventional surveys.
that seeks to redefine offshore explora- the same cost” as a single one, Larsen Tethering the tool to the outside world
tion operations. In spite of funding cuts explained. “You don’t need the rig, the is a combined power and fiber-optic
due to the ongoing downturn, Chief Exec- helicopters, or all the people.” cable that will spool out of the back end
utive Officer Øystein Larsen said his start- The entire exploration program connect to a seabed manifold that pro-
up is perhaps 3 years away from “build- could be done by a service vessel used vides power. The company is currently
ing a robot that will drill down into the to launch the tool, or probably several exploring ways to use the fiber to moni-
underground and search for oil and gas.” tools to form an array. The badger is then tor pressure and acoustics.
Named after the company, the badger guided down and locked into its drilling The data will be streamed beyond the
tool is essentially a 100-ft-long bottom- position by a remotely operated vehicle. manifold and up to a satellite buoy to
hole-assembly package that is designed Each tool will be installed with various enable operators to monitor and readjust
to reach subsurface depths of 3000 m. logging and sonar systems to analyze its drilling parameters—the one thing
The technology promises offshore pro- geological conditions and monitor the Larsen said the operators can control
ducers the tantalizing prospect of elimi- prospective reservoir. once the tool has burrowed itself into

JPT • JULY 2016 29

 Offshore Development Slump Likely To Cause Long-Lasting Pain
Stephen Rassenfoss, JPT Emerging Technology Senior Editor

Those waiting for the offshore exploration sector
to come back should expect delays. “We are at the
bottom of the cycle,” Julie Wilson, research director
for global exploration at Wood Mackenzie, said during
a presentation at the 2016 Offshore Technology
Conference (OTC) that showed deepwater spend
declining through 2020, with no upturn in sight.
The problem is that an oil price of USD 50/bbl is
still short of the price needed to profitably develop
deepwater fields. An oil price of USD 60/bbl is the
break-even cost for 70% of the proposed deepwater
projects, she said.
The energy information company predicted a
growing backlog of postponed projects in the coming
years, totaling USD 150 billion by 2020, in a sector
Deepwater Capex (USD billion)
where future investment will be affected by whether
it can break from its reputation for high costs.
Deepwater producers have made progress in cost
cutting. Despite the drop in hydrocarbon prices since
2013, the gap between the value of what has been
discovered and the cost of finding and appraising those
fields has narrowed. But the deficit remains significant.
“Hammering the service sector will not make projects
viable again,” Wilson said. While service companies and
suppliers cannot afford further discounts, savings are
possible because, she said, “there is huge waste across
the industry.”
For example, projects to build the trains used to
liquefy natural gas have had huge cost overruns.
Those high-development prices combined with
depressed prices for natural
gas worldwide led to the

50 deferral of USD 43 billion

Control Line Pipeline Platform
45 in deepwater projects in
Single Point Mooring Subsea Completion Australia, and USD 37 billion
40 in Mozambique.
35 Lowering offshore
costs, though, will require
30
more than better project
25 management. The rising costs
also reflect rising numbers of
20
dry holes. The drilling success
15 rate dropped from 40% to
10 35% between 2012 and 2015,
as the industry went after
5 prospects in increasingly
0 complex formations.
2014 2015 2016 2017 2018 2019 2020 Some discoveries have
proven too costly to develop
Capital spending is expected to continue falling in the near term. Graphic because the fields were in
courtesy of Wood Mackenzie. remote areas where the cost

the subsurface. Otherwise, the tool will
remain on autopilot as it heads to its tar-
get depth.
Badger Explorer wants its robotic
drilling unit to achieve a lifespan of
nearly 15 years to offer time-lapse res-
ervoir monitoring, also known as 4D
seismic. To help it achieve that critical
capability, the company recently teamed
up with Honeybee Robotics, an engi-
neering firm that designed many of the
drilling tools found on the long-lived
Mars rovers.
So far, two prototypes have been built
and tested onshore where Larsen said
two of the most critical components were
successfully demonstrated: the drill-
cutting-transport-system and the com-
paction technology.
Moving the drill cuttings to the top of
the unit was a challenge because there
is no way to use drilling mud in such a
system. Once moved to the top, those
cuttings must be packed so tightly that
they retain their original porosity. This
ensures that any hydrocarbons encoun-
tered while drilling cannot freely escape
the wellbore and reach the surface.
But before this innovation becomes a
reality, Larsen said much work remains.
He also noted that in the wake of the
current downturn many of the backers
of the program have put their funding
on hold. Those companies who have left
with their checkbooks include Exxon-
Mobil, Chevron, and Wintershall.
The only original sponsor currently
committing funds to Badger Explorer
is Norwegian state-owned oil company
Statoil. “We are in continuous dialogue
with the other partners, and we have
reason to believe they will come on
board again, but it is much harder to get
funding now than it was 2 years ago,”
Larsen said.
Plan For More, Spend Less
If oil companies use a bit of foresight
and at the same time are willing to make
some compromises, then they stand to
improve their field economics in a num-

30 JPT • JULY 2016

 of installing production facilities was too high, or there production with infill wells at its Lucius Field in the
were problems to solve, such as high-temperature/high– Gulf of Mexico, according to the presentation.
pressure reservoirs. Brownfield investments, such as enhanced
Even if oil prices rise above USD 60/bbl long enough oil recovery (EOR), are also likely to become an
to alter industry expectations about future price trends, increasingly significant source of added barrels. In a
those fields will be competing with development presentation at OTC, BP talked about why it sees a
alternatives such as onshore unconventional plays. payoff in large technology development investments
For example, Chevron’s Buckskin/Moccasin offshore in low-cost EOR as well as improved seismic imaging,
project in the Gulf of Mexico is expected to produce which can highlight remaining opportunities in
oil for about USD 62/bbl, while the company’s best older fields.
unconventional wells in the Permian Basin deliver at “By applying the best technology in the best
about USD 40/bbl, and do not require the long-term giant fields you can add a lot of value in the next
commitments of deepwater field development. 25 years,” said Ahmed Hashmi, global head of upstream
Offshore exploration is also competing with technology for BP.
investment in older fields. For example, Anadarko
estimated it would earn a 34% return by adding Others
UK 12
8
Indonesia
10
Full-cycle value creation Angola
US GoM
76
17

Nigeria
29

Mozambique
37
Australia
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 43

The value of discoveries has been less than the Deferred capital expenditure by country
cost of exploration and appraisal costs since in USD billion. Graphic courtesy of Wood
2013. Graphic courtesy of Wood Mackenzie. Mackenzie.

ber of ways, Cobie Loper, vice president
of business acquisition at SBM Offshore,
told attendees at the Offshore Technol-
ogy Conference in Houston in May. SBM
is a global contractor of floating produc-
tion facilities including two of the Gulf of
Mexico’s most notable, Thunder Hawk
and the Independence Hub.
Loper said offshore producers that
build their own facilities run the risk of
missing original production expectations
or too often fail to build enough capacity
to handle potential satellite fields. “One
of the key development solutions” to this
problem, he said, “are hubs where you
share multiple assets with one produc-
ing unit.”
He explained that facility contrac-
tors tend to be more optimistic on the
production potential of an area and are
therefore less likely to underestimate
production needs. When SBM plans for
a floating facility, it draws a 30-mile cir-
cle around the parent field and looks for
what else might be developed.
For producers who buy into the con-
tractor model, which involves them pay-
ing a per-barrel handling fee, Loper said
the benefits can include a smaller upfront
investment, earlier first production, and
a significant reduction in decommission-
ing liabilities.
Using Thunder Hawk as the prime
example, Loper explained how SBM
designed it with 2,000 tons of spare
capacity, which enabled a recent expan-
sion of its maximum production from
45,000 B/D to 60,000 B/D.
The deep-draft semisubmersible came
on stream in 2009 with Murphy Oil as
the primary operator. Then in 2012 and
2013, Noble Energy discovered two sub-
sea fields between 7 and 18 miles from
Thunder Hawk. Three new wells were
drilled which meant a new gas lift, chem-
ical injection, and flowback control sys-
tems were added to the floater’s topsides.
After all that, there remains enough
space left over for Noble to install a water
injection system to support production
as its wells mature.

JPT • JULY 2016 31

 Once in the ground and drilling, the Badger tool will conduct a series of logs and seismic surveys to enhance an
operator’s understanding of an appraisal site. Graphic courtesy of Badger Explorer.
The option to use the facility as a
hub enabled Noble to bring on the wells
using subsea tiebacks between 2 and
3 years from discovery—less than half
the time that it takes to achieve first oil
from wells requiring new facilities. For
Noble, using tiebacks to produce from
existing facilities is the norm; all but
one of its Gulf of Mexico projects involve
this strategy.
Wesley Johnson, a Gulf of Mexico
asset manager for Noble, said using the
hub approach to develop the two fields
reduced the size of its initial investment
while helping double its Gulf of Mexico
oil production in just one year. “In this
case, it’s a clear example of what can be
done at any price environment with sub-
sea tiebacks,” he said.
Loper said SBM is in talks with a num-
ber of operators to build a second Thun-
der Hawk “just as is.” By using the exist-
ing design he said the company could
build and deploy the next facility in
28  months, about 4 months less time
than the original required. This factor
alone would help lower costs by a signifi-
32
cant margin, but requires the clients to
stick to the plan.
“Everybody wants a unique system,”
Loper said as he warned that focusing on
unnecessary specifications can increase
costs by 30-40%. “If you have a system
that is working and producing effectively,
we don’t really see the value in changing a
lot of those details.”
He noted that while today most tie-
backs are within 10 to 15 miles from
the hub, he expects advances in engi-
neering to make using longer tiebacks
more feasible. The current tieback
record is 43  miles for oil and 93 miles
for gas.
Oil companies that build and oper-
ate their own facilities can also benefit
from using flexible designs that allow for
expansion. Following the conclusion of
a 3-year refurbishing project, BP recent-
ly announced that it has turned on a
newly installed water injection system
to enhance production at its mammoth
250,000 B/D capacity Thunder Horse
platform. The platform came on stream
in 2008 and its new injection scheme is
hoped to produce an additional 65 mil-
lion bbl over the life of the development.
Suction Piles to the Rescue?
For shallow-water stranded reservoirs,
the trick to making them profitable may
not involve new technology or the expan-
sion of existing facilities. Rather, it might
be as simple as picking a platform up and
moving it a few miles away to the next
closest field.
This is the idea that Thomas Span-
jaard, a tender manager at SPT Offshore,
championed in an SPE paper present-
ed earlier this year at the OTC Asia con-
ference in Kuala Lumpur. The linchpin
to this concept involves a rather simple
technology that has been around since
the 1980s: suction piles.
Mostly used as a mooring or anchor-
ing device on floating facilities, suction
piles are placed over the seabed and then
water is sucked out to generate the nega-
tive pressure that secures them in place.
This process is easily reversed by forcing
water back into the suction pile, releasing
it from the seabed.
JPT • JULY 2016
A three-legged suction pile platform being towed into position. This reusable design could help offshore producers
drive down the lifting costs of shallow reservoirs. Photo courtesy of SPT Offshore.
Using suction piles instead of the
more commonly used driven piles, which
require much more installation work,
companies could redeploy the same plat-
form, topsides and all, over and over
again. “By doing that, you can spread
your capex over several fields, instead
of only on one, and that could be the
key to unlocking certain marginal fields,”
Spanjaard said.
Removing a suction pile takes only
a few hours he said and relocating the
facility not only delays decommissioning
costs, but lowers those costs because the
process requires none of the special tools
or lengthy operations used to take apart
pile-driven platforms.
Perhaps the most important consider-
ations involved with this concept are the
foresight required to optimize the plat-
form for multiple fields and that the relo-
cation operation takes only 2 or 3 days
to avoid issues related to weather and
sea conditions.
The concept is not one that has been
widely accepted yet. Spanjaard said suc-
tion piles are considered a mature tech-
JPT • JULY 2016
nology, yet he estimated that only about
20 fixed platforms use them around the
world and even fewer were designed to
be relocated.
“What we commonly see is that com-
panies do not fully understand the risks
and mitigations that can be used for such
a technology,” he said. “But once these
are understood, we think those com-
panies become a real sponsor—they see
the benefits.”
Spanjaard said early stage engi-
neering represents another barrier.
Because suction piles are rarely used
as a platform foundation, they are not
often taken into account in the original
designs, which become hard to change
once accepted.
The most notable exceptions to the
industry’s lack of interest in this area is
found in the North Sea where German-
operator Wintershall has deployed three
platforms designed to be relocated using
suction piles. SPT performed the design
review of the platforms and performed
the suction pile operation for both the
original installation and the relocations.
Spanjaard said he is not aware of any
other cases where this has been done, but
in his paper he noted there is great poten-
tial elsewhere.
In particular, he explained that off-
shore Malaysia there are more than 100
marginal fields that could benefit from
this strategy. The Malaysian fields are
each found in similar depths, and have
more or less the same seabed soil qual-
ity which he said “makes this solution
tailored for that market.” JPT
For Further Reading
SPE 178859 Long Reach Well Concept
by Sigmund Stokka, International
Research Institute of Stavanger,
et al.
OTC 26611 How Can Suction Pile
Foundations Help to Maximise
Profitability of Marginal Fields?
by Thomas Spanjaard and
R.H. Romp, SPT Offshore
OTC 27167 Turning FPU’s Into Hubs:
Opportunities and Constraints
by Ricardo Yoshioka, SBM Offshore
33
 BOPs Become the Focus
of Data-Driven Scrutiny
Stephen Rassenfoss, JPT Emerging Technology Senior Editor

Technicians working at the control desk of BP’s real-time offshore drilling monitoring center in Houston can draw from
25 screens with data and images showing operations in the Gulf of Mexico. Photo courtesy of BP.

N
OV’s pressure control research
and development (R&D) labora-
tory is in a tall factory building
with a row of large, thick-walled booths
used to test how blowout preventers
(BOPs) perform at extreme temperatures
and pressures.
During a tour, NOV’s R&D Lab Man-
ager Roger “Dale” Brown made a point
of stopping to open a small electrical
box. Nearly all of the 24 slots inside were
filled with cartridges, each about the size
of a deck of cards. The circuits inside
them allow engineers to gather what-
ever sort of data they need from BOP
tests and send it along to NOV’s central
data recorder.
The box is a tangible sign of the indus-
try’s growing appetite for data as it seeks
ways to reduce risk, increase efficiency,
and pare costs. For Brown, it represents
a big change from how things were done
just 5 years ago, when the only data avail-
able often were just printouts of spread-
sheets and graphs of pressure test data
stored in a file folder.
Having a deep pool of data is “like a
different set of glasses,” he said, add-
ing that, “I am asking questions I never
asked before.”
At a time when sales of stacks of subsea
well control equipment as tall as an office
tower are all but dead, BOP makers such
as Cameron, GE Oil & Gas, and NOV are
all working on developing digital tools
to address pressing problems facing cus-
tomers. An issue for some is the well con-
trol rule from the US Bureau of Safety
and Environmental Enforcement (BSEE),
which requires deepwater operators to
gather real-time data from the BOP con-
trol system and come up with a way to
do real-time monitoring where offshore
data can be observed by expert advisers
on shore.
“One of the things we are pushing for is
an extra set of eyes onshore, the ability to
bring expertise from other areas and pro-
vide technical support as issues arise,”
said Doug Morris, chief of the office of
offshore regulatory programs for BSEE.

34 JPT • JULY 2016

 The value of monitoring programs will
depend on the quality of information that
can be extracted from a growing flow of
data, and the ability of those onshore
to build relationships with drillers who
trust that the advice is useful.
Data use by Shell, which was a pio-
neer in real-time monitoring, evolved
over time. It was initially “used for post-
mortem analysis, and people realized
there is value if we get out ahead of this,”
using early warning signs to avert poten-
tial problems, said Lt. Kyle Carter, a
technical adviser at the US Coast Guard’s
Outer Continental Shelf National Center
of Expertise.
Carter studied real-time monitoring
while he was a graduate student at
the University of Texas at Austin (SPE
170323). His comments reflect his
thoughts and research, and should not be
taken as representing the official views of
the Coast Guard, whose responsibilities
include regulating aspects of oil and gas
operations offshore.
While BSEE’s mission is to reduce
threats to safety and the environ-
ment, the future of deepwater explora-
tion depends on finding ways to sharply
reduce costs.
The potential financial rewards for
investments in monitoring and analy-
sis include designing and manufacturing
more reliable equipment, reducing the
time lost due to equipment failures by
more accurately predicting when parts
will fail, and reducing maintenance costs
by moving from time-based repair sched-
ules to systems based on actual wear.
“We are at start of a data revolution in
the oil and gas industry,” said Eric van
Oort, a professor of petroleum engineer-
ing at the University of Texas at Austin.
“We now see that we have data, need
more data, and have a bunch of data
issues we need to take care of.”
The professor who established a net-
work of real-time offshore drilling con-
trol centers when he worked for Shell
is now advising regulators on how they
can do their jobs more efficiently, such as
observing offshore testing at a real-time
monitoring center on land, rather than
flying out to a rig.
Satisfying the rule requires companies
that do not already have real-time moni-
JPT • JULY 2016
toring to create a plan to create a secure,
reliable system to gather and share data
on the state of the BOP, as well as on
fluid flows and downhole conditions,
with onshore personnel. This requires
creating a secure connection sending
data from an offshore drilling rig to an
onshore observer who does not have to
be in a central location.
Cameron is running a pilot project on
an upgraded system that collects data
at a higher resolution; compresses,
transmits, and stores data; and enables
remote, real-time monitoring on displays
like those used on the rig.
Security is also an essential element in
these systems. GE’s control and data col-
lection systems are designed to isolate
critical well control equipment, so data
can flow out but unauthorized users can-
not get in and take control.
These extra sets of eyes must be mar-
ried to more analytical brains to turn the
data into useful insights.
“The BSEE well control rule is viewed
as a catalyst that will drive remote, real-
time monitoring of the BOP control sys-
tem, which will normalize the practice
and will lead to more intelligent sys-
tems,” said Zach Hrabak, product line
manager for Cameron, who is work-
ing on condition-based monitoring sys-
tems. “Collection of data and analysis will
reduce unplanned downtime and drive
equipment design optimization with the
ultimate goal of reducing nonproductive
time for our customers.”
Drilling is following a path traveled
by other industries. For example, GE’s
drilling division is drawing on the expe-
rience of the company’s jet engine divi-
sion, which is constantly tracking the
condition of its engines on jets around
the world.
Data-sharing is a common practice
for airlines, but not for rig owners who
generally consider it proprietary infor-
mation. GE worked around that barrier
with a deal that is unique in the oil busi-
ness giving it control of the BOPs used
by a drilling contractor. Under the con-
tract with Diamond Offshore, GE bought
back eight BOP stacks, then leased them
back to the offshore driller. The ser-
vice agreement gives GE access to the
data and equipment maintenance as
part of a deal where GE gets paid only
if the equipment performance meets
certain standards.
While this is similar to leasing jet
engines to airlines, in the offshore oil
business the drilling company normally
works closely with the oil company that
plans the well and pays the bills.
“Honestly, it has been a big learning
experience. It (a leaseback) has not tra-
ditionally been done in this space,” said
Bob Judge, director of product manage-
ment for drilling at GE Oil & Gas. Col-
lecting data over long periods of time
marks a significant change in a business
where “we have no historical record of
how BOPs are operated. We do not know
how many times it was used, and what
happened yesterday, and what happened
before it failed.”
Blowout Drives Change
The Macondo blowout in 2010 that
destroyed Transocean’s Deepwater Hori-
zon rig pressed BP into a role at the fore-
front of this industrywide change. The
company created a real-time monitor-
ing center tracking drilling with experts
elsewhere following other offshore oper-
ations. Other groups in BP helped devel-
op a well control condition display with
NOV that uses a stop light format, and it
has been using data to closely track the
health of BOP systems and using those
reports to reduce drilling time lost due to
equipment problems.
Since 2012, BP’s program to identify
and address the causes of BOP-related
downtime allowed it to reduce the num-
ber of drilling days when equipment was
pulled for repairs from 600 days in 2012
to 150 days in 2015, said David Eyton,
group head of technology for BP.
“Now we know if it is not 100 percent,
that brings a lot of pressure to bear on
the manufacturer” to resolve costly prob-
lems, he said.
Jose Gutierrez, director, Technology
and Innovation for Transocean, said the
results of sophisticated mathematical
analysis must be grounded in an under-
standing of how machines perform
while drilling.
“What we need to measure are those
right moments and right values,” he said.
The data can be used to track the likely
35

Students at the University of Texas at Austin have use of a real-time
monitoring center, which was started by Eric van Oort, a professor there
who helped create Shell’s monitoring centers. Photo courtesy of the University
of Texas at Austin.
life span of parts using established meth-
ods. “That is not analytics. It is common
engineering logic.”
NOV uses a stream of data from BP and
others to build more reliable products.
The company has a team of data scien-
tists working closely with its engineering
experts to study product performance.
Their priorities are based on a list rank-
ing the problems based on how much
they cost users.
One of their projects is a database
gathering all of the data related to each of
its elastomer products from the day these
critical rubber parts are made at the NOV
plant. It will also include product testing
results and how each part performs over
its lifetime.
BOP makers are also working on bet-
ter software to detect early signs of pos-
sible problems while drilling. “The [BOP]
function logger is morphing into an
onboard diagnostic system,” said Lance
Staudacher, electrical controls manager
for NOV Rig Systems.
The early results have been encour-
aging. “The improvement that has hap-
pened. It is pretty remarkable,” said
Frank Springett, vice president and
general manager for the pressure con-
trol group at NOV. “What we see as the
next step is gaining the ability to pre-
36
dict failures before they happen and
act accordingly.”
Maintenance by the Numbers
BOP maintenance schedules are nor-
mally based on the time the BOP has
been in service. The BSEE well control
rule requires owners to “break down
the entire BOP system every 5 years
for recertification.” These inspections,
which can be done in stages, require
each part to be inspected and worn
ones replaced.
Equipment makers point out that
there is little evidence supporting the
need for this costly system, and that tak-
ing a complex machine apart and putting
it back together can cause problems.
“There is nothing behind the 5 years
(schedule) except that it is an industry
accepted rule of thumb,” Judge said. GE
and others are working to change that
by building a case for standards based
on how fast parts actually wear out.
The companies are creating software
that counts cycles on their equipment—
the number of times each component is
used. The goal is a dependable estimate
of how many cycles their parts are like-
ly to last, under specific conditions.
This could allow warnings when a part
is nearing the number of cycles where
failure is likely so it can be replaced
during scheduled downtime.
Other data points are being consid-
ered. NOV is tracking the gallons of
fluid flowing through valves to see if
that is a good wear indicator.
Another regulation in question is the
requirement that users test BOPs every
14 days, which is based on an API stan-
dard. The test requires drilling to stop
so the rams can be closed, adding wear
on the equipment. Other methods may
make it possible to tell if the equipment
is ready to go without having to close
the rams.
“That (data analysis) might indicate
more confidence in the capability of
that equipment,” Morris said. “It might
reduce the need to stop drilling activ-
ity and do pressure testing as the pri-
mary way to determine the health of
the equipment.”
Another possibility is using data-
based methods to demonstrate that
key equipment complies with regu-
lations, reducing the number of off-
shore inspections, “which are highly
disruptive events for operators,” van
Oort said.
This does not mean the end of off-
shore inspections. Those writing and
commenting on monitoring say that
inspectors will need to see how things
are done offshore, but more data could
help focus their attention to critical
spots in these complex operations.
But rapid change is not likely. NOV
got started early on monitoring, with
a couple years of data from Ensco Rigs,
and the number of rigs it monitors is
growing. One thing the company has
learned is that BOPs generally do not
lead eventful lives. “You do not have
failures every day, so it takes years,”
Staudacher said.
The pressure readings by a data sci-
entist often require a close look at the
hardware to see if an observation is an
indication of something that will cause
trouble, or just bad data. An early anal-
ysis from a GE analytical pilot program
showed multiple issues in the electri-
cal system on one BOP stack, but none
on its twin. The odds of that happening
randomly are impossibly high, Judge
said. To figure out why, an engineer
JPT • JULY 2016
with expertise in subsea electrical sys-
tems was assigned to figure it out.
“What we found is we need to have a
subject matter expert alongside a data
scientist and let them ask questions,”
he said.
An early target for NOV’s team of sci-
entists and engineers was pressure reg-
ulators. The device, which manages the
pressure of the hydraulic fluid as it goes
from the supply line to the BOP, was at
the top of its list of costly problems for
owners of BOP stacks.
The project began with a course on
how regulators work for the data sci-
entists, who also “took them apart to
see how we designed them,” Staudacher
said. They needed to understand the
inner workings of the machines to sift
through years’ worth of data and distin-
guish telling details from bad data.
The result was two algorithms based
on data patterns that can indicate poten- Displays show drilling in progress at BP’s real-time monitoring center in
tial future trouble. One was based on Houston. Photo courtesy of BP.
data showing a change in the normal
pattern of pressure changes at one valve. to you unless you had a workflow pro- ted onshore—data from the BOP con-
The team observed that the variations cess, and you have the people that can trol system, drilling fluid flow rates,
appeared to be correlated with changes make the changes in the field instigated and drilling data from the bottomhole
down the line that could be an indication by the data analysis.” assembly—and BSEE must be given
of a failure ahead. A study by NOV analyzing why some access upon request.
The data scientists and engineer- parts fail early concluded that “there is The regulation said real-time moni-
ing experts worked together to gath- a percentage of (failures due to) manu- toring is to be used “to assist rig person-
er physical evidence that showed that facturing defects, but more are due to nel in identifying and evaluating abnor-
the pressure change could be predic- installation issues,” Staudacher said. malities and unusual conditions before
tive. Now when a change in the pat- The next step is understanding what they become critical issues.” But it is up
tern is observed, a note is sent to engi- happens during installation, and finding to the companies to figure out how they
neers who decide whether to pass the a cost-effective way to change that. One can best do so. The possibilities include
advisory on to clients, who may or may option under consideration is creating creating a monitoring system connecting
not act. training videos on the information page experts at various locations, rather than
“The algorithm is relatively new. We for each component. building a center.
have fairly high confidence. We need Changing habits is hard, but the pay- One approach that is not like-
to build confidence in customers, who off for doing so can be large. For exam- ly to work is trying to manage drilling
may decide to let it run its course,” ple, by analyzing data generated while remotely. Drillers do not want someone
Staudacher said. installing casing, BP created software to onshore following along with a com-
track casing runs that it said has elimi- puter screen telling them what to do,
Motivating Change nated instances of stuck casing, saving Carter said.
The value of data-driven drilling ideas more than USD 200 million in the 2-year “Those in a real-time center … are not
depends on the willingness of people period ending in mid-2015, said Ahmed there to drill the well, but to help the
and organizations to do what it takes to Hashmi, global head of upstream tech- drillers drill the well more efficiently
apply them. nology for BP. and safely,” he said. Those in the drill-
“Remember, getting data and building BSEE’s rule requires all companies ing chairs are looking at increasingly
nice displays and nice visualization pro- drilling wells in deep water or in high- crowded displays as more drilling data
grams is the easy part,” said van Oort. “I pressure/high-temperature formations are added, and can benefit from skilled
can show you nice plots analyzing drill- to have a plan for doing real-time mon- onshore advisers filling in the gaps.
ing data, and how many days of rig time itoring that supports those operations. “The great thing in this is they can
you can save. That would mean nothing It specifies what must be transmit- provide context over time for a trend. A

JPT • JULY 2016 37

 driller may be focused on that stand of
pipe,” Carter said. He likened the adviser
role to the people who work in the Coast
Guard’s Vessel Traffic Service who track
the course and speed of commercial ves-
sels in busy harbors. When a vessel strays
from its intended course, someone from
the traffic service will contact them to
deal with the potential problem. As older
hands retire, an expert in a center can
support several less-experienced drill-
ers, he said.
What has been done by majors to
establish real-time monitoring will need
to be adapted as companies with differ-
ent levels of staffing and cultures estab-
lish their own centers. Service com-
panies or partnerships may play a role
in monitoring.
A study for BSEE by DeepStar, an
industry deepwater research group, is
looking at which data need to be collect-
ed and transmitted.
Another project for BSEE by Camille
Perez, an assistant professor in environ-
Rethinking the Blowout Preventer
B OP Technologies has designed a
blowout preventer (BOP) that it
says is simpler, more efficient, and, most
importantly, can deliver enough power to
shear anything that goes into a well.
After 3 years of work, the small Hous-
ton company is showing off models and
pictures of a new compact, cylindrical
design that it says can drive a shearing
ram with 5 million pounds of force—
more than 60% greater than what is
now available—and that will be able to
cut through drill collars that cannot be
cut by currently available BOPs.
“It delivers the power. That is where
they come up short,” said Jay Read, the
inventor of the device and founder of
BOP Technologies.
The big problem now facing BOP
Technologies is “we have got to prove
it,” Read said. The company needs to
raise millions of dollars to build a BOP
big enough to show what it can do to
actual steel tubing. But based on his
long experience building BOPs for the
biggest makers in the industry, he said
38
mental and occupational health at the
Texas A&M University Health Science
Center in College Station is looking at
what it takes to create effective BOP mon-
itoring displays that deliver critical infor-
mation to decision makers.
BP’s and NOV’s display that uses a stop
light format to highlight the status of key
BOP systems is now being used on two
rigs drilling for BP, and the company said
it is looking at expanding the pilot pro-
gram. Color-coded warnings are intui-
tive, but the question remains: Will drill-
ers, like automobile drivers, tune out
the dashboard?
“If they are staring day after day at
screens full of stop lights, you have to
worry that at some point they will stop
paying attention,” van Oort said.
With more and more people able to fol-
low drilling in progress—some of these
data feeds can be displayed on a smart-
phone—there is also the concern that
it will dilute the authority of those on
the rig.
he is looking forward to it, adding, “I
can’t wait.”
While BOP Technologies is talking
about its ideas as it seeks backers, Shell
and Transocean have quietly been work-
The new blowout preventer design
does not have arms extending from
its body, normally a standard feature
for these well control devices. Photo
courtesy of BOP Technologies.
During its rule-making procedure,
BSEE received multiple comments about
the dangers of drillers being distracted
by too much advice and the dangers of
moving decision making off the rig. BSEE
responded in the final rule by saying “it
does not intend that onshore person-
nel monitoring the real-time monitoring
data would have operational control over
the rig based on the data.”
BSEE does not want to try to define
that evolving relationship. “That is up to
the operator. Some companies do pro-
vide a little more authority onshore” to
subject matter experts, Morris said. “It is
totally up to the industry to decide about
the operating decision-making process.”
For Further Reading
SPE 170323 Improved Regulatory Oversight
Using Real-Time Data Monitoring
Technologies in the Wake of Macondo
by K. Carter and E. van Oort, University
of Texas at Austin, and A. Barendrecht,
Genesis RTS.
ing over the past 3 years on a new-
generation BOP control system, said
Jose Gutierrez, director, technology and
innovation for Transocean.
“This is an opportunity to attack the
status quo,” said Gutierrez, adding that
the control systems available now are
unreliable, resulting in much lost time
during drilling. “It removes value from
the system,” he said.
The process used by Shell and Trans-
ocean relies on methods regularly
employed by industries such as aero-
space to develop reliability-centered
designs, which allow systems to con-
tinue working even when parts fail,
Gutierrez said, but said he could not
provide further details.
In the wake of the blowout of the
Macondo field in 2010, which destroyed
Transocean’s Deepwater Horizon rig,
regulators have focused on reliability
and pushed for a BOP able to shear
whatever was inside it.
While that remains a goal of the US
Bureau of Safety and Environmental
JPT • JULY 2016
High-pressure fluid flows in the BOP Technologies blowout
preventer (blue line below) filling a chamber which
expands, compressing fluid in the smaller intensifier
chamber (red square) above. Illustration courtesy of BOP
Technologies.
The expanding piston can magnify the pressure in the
intensifier 10-fold, which is used to drive the piston.
Illustration courtesy of BOP Technologies.

Enforcement (BSEE), which is tracking
efforts like BOP Technologies, the off-
shore regulator has not set a deadline
to reach that goal. In BSEE’s recent-
ly released well control rule, it calls
for BOP stacks with two shear rams to
ensure that if one cannot sever what is
inside, the other will be able to do so.
In the rule-writing process, a time
limit was considered for development
of a BOP that can sever anything, but
it is not in the final rule because such
equipment “probably doesn’t exist”
now, though BSEE is still seeking a prac-
tical way to reach that goal, said Doug
Morris, chief for the office of offshore
regulatory programs for BSEE.
Adding to the difficulty for equipment
makers is a market where demand for
well control equipment has disappeared
with the deep slump in offshore explora-
tion and production.
While Gutierrez acknowledged that
in this market, “you see blood on the
floor,” he is hopeful because there is also
“more focus on inventiveness, efficien-
cy, and cost.”
Mark Alley, chief executive officer of
BOP Technologies, said “there is serious
interest in” his BOP design but he has
yet to secure project financing.
The thinking behind the BOP Tech-
nologies design began after Read left
Cameron and was working at a small
think tank considering inventive oilfield
ideas. He said that being away from an
established BOP maker for the first time
in his career freed him from the limits
that come with designing products for
a company with a successful product
where fundamentally changing things
has significant consequences.
“We went in it with a different
approach to create the ultimate shearing
BOP,” he said. One obvious difference is
that the device does not have long arms
holding the pistons driving the shear-
ing rams. Instead it uses an “intensifier
piston.” Pressurized hydraulic fluid fills
a larger piston that pushes up, shrink-
ing the area inside the smaller inten-
sifier piston. The compression of the
fluid in the intensifier piston turns the
4,000-psi stream of fluid flowing into
the larger piston to generate 40,000 psi.
The round shape of the intensi-
fier assembly is reflected in the BOP
brand name, Cirbop, which was based
on the description: circular intensifi-
er ram blowout preventer. When the
BOP is fired, that pressure can be used
to drive the rams, applying millions of
pounds of force without arms the size of
oil drums.
This approach requires a hydrau-
lic supply line operating at 4,000 psi,
compared with 7,500 psi for other
high-capacity deepwater BOPs, reduc-
ing the pressure on the line as well as
the pressurized fluid stored in accu-
mulator bottles at the wellsite. It also
has about a third fewer parts than a
conventional design.
Another difference in the design is
the lack of nuts and bolts in sight. This
makes it easier to service, Read said,
and those connectors are not exposed
to salt water.
The case for doing something differ-
ent is persuasive until one considers the
obstacles facing a tiny startup compet-
ing with the biggest oilfield service com-
panies at a time when the business is in a
deep slump. But Read is optimistic, say-
ing, “I have no doubt in my mind that
this will eventually be used. When it will
is a big question.” JPT

JPT • JULY 2016 39

 Increasing Efficiency,
Safer Operations Key
Themes at OTC
D
espite the downturn in the oil and
gas industry, more than 68,000
experts and leaders gathered
from across the world in Houston for the
2016 Offshore Technology Conference
(OTC) in May. The number of attendees,
from 120 countries, put this year’s OTC
among the top 15 in attendance in its
48-year history.
“As it has since 1969, the world came
to OTC to make critical decisions, share
ideas, and develop business partnerships
to meet global energy demands,” said Joe
Fowler, 2016 OTC chairman. The confer-
ence included 11 panel sessions, 24 exec-
utive keynote presentations, and more
than 325 technical paper presentations.
Increasing efficiency while ensur-
ing safe operations was a key theme at
this year’s conference. Sessions covered
new technologies that not only reduce
costs to the operator but enhance the
overall safety of the operations; cost-
effective advances in well cementing
technologies; and use of RFID to precise-
ly track drillpipe.
40
Subsea Processing
Panel sessions covered a variety of indus-
try issues, including the value of subsea
operations. Moving oil/water separation
equipment from platforms to the seabed
looks inevitable, but based on the cur-
rent rate of adoption, it may require a
long-term outlook. Out of the 5,000 wells
with subsea completions, only five have
used some variety of separation, whether
it is separating water from oil, gas from
liquids, or treating seawater before it is
injected into a reservoir.
A panel made the case for why sepa-
rators are a better option in deep water
than lifting water a mile or more, pro-
cessing it, and pumping it back down to
the bottom for injection into the ground.
“It is going to happen,” said Jeff Jones,
senior subsea systems consultant for
ExxonMobil. “We will get back to it.”
Jones referred to subsea separation in
the past tense because it has been a while
since the five projects, eight if you include
some smaller units used for pilots, have
gone into service.
“It is not as dead as you think,” said
Don Underwood, director of subsea pro-
cessing for FMC Technologies. “We are
in a world where, perhaps, operators
cannot go forward with greenfield proj-
ects,” but still need to find ways to add
production to make up for declines in
older wells.
As for what will turn the inevitable
technology into a practical option, the
one-word answer is cost. Statoil, which
has been a major supporter of moving
operations subsea, has said that a 50%
cost cut is needed, while Petrobras has
put that number at 30%.
“There has been significant movement
in that direction,” Underwood said. “For
one, prices have been lowered dramati-
cally,” while designs have shifted from
huge units to “lower-cost, compact tech-
nologies” that can be added as a cheaper
alternative to drilling.
“Drilling these wells will be so expen-
sive, but tying back to existing hosts
would help us squeeze every last barrel
we have,” Jones said, noting that drilling
JPT • JULY 2016

costs represent 50-80% of the cost of
offshore projects.
So far the company’s only experience
with subsea separation is as a partner
with Total on its Pazflor project off West
Africa, which is operated by Total. There,
gas is removed from the oil to ease lift-
ing. But Jones said the technology could
be used on its developments off New-
foundland to increase the output from
tiebacks—eliminating the need to build
lines to carry both water and oil as well
as reducing flow assurance issues—and
processing seawater used for injections
to enhance production.
Removing the water and disposing it
saves the cost of lifting water, which is
then pumped back down to the bottom to
be injected into the formation. As fields
age, and when the water cut far exceeds
the oil, operators must either expand
processing capacity on the platform or
live with limited output.
“Adding a pump is sometimes not the
most efficient answer, but it is easier,”
Jones said, noting that the comfort factor
JPT • JULY 2016
exceeded the energy required to pump
water to the surface, process it, and send
it back down.
Turning subsea separation into a tool
used as widely as pumps will require
executives to show their support for
doing something new, and make it clear
that project managers are not risk-
ing their career if they choose to use
subsea processing.
The heightened attention on the
risk of using subsea processes may be
adding to the complexity, which is an
obstacle to adoption. One of the tough-
est challenges is removing sand from
the production stream because it can
shorten the life of these devices. But
that could introduce the complexity-
driven risks.
“If a pump can, in theory, fail because
of sand, we create a sand system that
is 10 times more complicated than the
pump,” said Rune Fantoft, chief executive
officer of Fjords Processing, a Norwegian
firm working on separation. While he
recognized the need for improved equip-
Jeff Jones, senior subsea systems
consultant at ExxonMobil, talks about the
company’s effort to incorporate subsea
separation to make it easier to lift oil
from the seafloor.
ment to deal with such problems, he
pointed out the methods are likely to
be drawn from what is now down above
the surface.
FMC has addressed one of the prob-
lems nagging subsea operators—the
hard-to-separate emulsions of water
and oil that stymie processes—with its
InLine ElectroCoalescer, which earned
it an OTC Spotlight on New Technol-
ogy Award. The device uses electrical
currents to cause oil to form droplets
that can be easily removed from water.
It is not a new idea, but it is a compact
solution to emulsions, which separa-
tion methods using forces such as grav-
ity cannot solve. “You cannot depend on
separation for that,” Underwood said.
“Emulsions could take days to break
down on their own.”
The industry needs to create other
compact, standard models that can be
added as needed to increase processing
capacity, according to the panel. But, so
far, the experience of the five projects
shows subsea processing methods work.
41
 Deepwater Future Tied to Technology Innovation
Joel Parshall, JPT Features Editor
The economics of deepwater development are more
challenging than ever in today’s low-price environment.
While technology innovation faces economic headwinds
for the same reason, it also remains the key to future
deepwater projects and will be essential to their
competitive sustainability through market downturns.
In a session on the energy outlook and the future
of innovations for deepwater in a cost-competitive
environment, panelists emphasized the need for scalable
technology, the standardization and simplification
of projects, patient capital investment in innovation,
greater collaboration, and new perspectives coming
from outside the industry.
“Fossil energy sources will continue to be a main
component of our energy mix out to 2050 and beyond,”
said Robert Armstrong, director of the MIT Energy
Initiative. “By 2050, fossil fuels will still account for
about 75% of our primary global energy supply.
“How do we continue to take advantage of these
fossil energy heat sources and at the same time start
driving down carbon emissions?”
Mission Innovation
Armstrong noted the Mission Innovation commitment
announced by 20 developed and developing countries
at the 2015 Paris Climate Change Conference to double
basic clean energy research and development budgets
by 2020.
“Basic energy research is the beginning stage of the
innovation chain,” Armstrong said, [but] “how do you
get innovative ideas to come out of basic research; how
do you get that into commercial practice? And that’s
a particularly difficult thing to do in the energy sector
because the amounts of capital required are quite large
and the time scales are quite long, compared with what,
say, the venture capital community is dealing with.”
An initiative addressing that problem, likewise
announced at the Paris conference, is the Breakthrough
Energy Coalition. It is a group of private investors who
committed to picking up projects coming out of the
Mission Innovation countries’ research—“providing
the kind of patient capital necessary to move them
from the laboratory and into commercial practice,”
Armstrong said.
Changing Paradigms
“Basic science research helps to change paradigms,”
said Kripa Varanasi, deputy associate professor of
mechanical engineering at MIT. “It really helps us to
move beyond where we are, but at the same time we
need to be thinking about scalability.” He discussed a
technology that he and a co-researcher have developed
and commercialized with the help of the university’s
programs for bringing innovations to the market.
LiquiGlide is a liquid-impregnated coating that acts as a
slippery barrier between a surface and a viscous liquid.
Varanasi and research partner David Smith were
interested in developing a coating to prevent the
buildup of ice on airplane surfaces and methane
hydrate in oil pipelines. However, LiquiGlide has
42
initially been commercialized in food and consumer
product packaging. A video created for a 2012 MIT
entrepreneurship competition, showing ketchup sliding
out of a LiquiGlide-coated plastic bottle, went viral
and received worldwide attention. Varanasi pointed
to a number of applications in which these coatings
could benefit the industry, such as flow assurance, tank
interiors, separation systems, and reduction in water use.
Tom Moroney, vice president of wells and facilities
technologies in projects and technologies at Shell, said
that the industry must find a new way to approach
technology development. “We need to innovate
innovations,” he said. Moroney called the Deepwater
Horizon disaster in 2010 a “forcing moment” for the
industry and the current fall in commodity prices
coupled with climate change another such moment.
“We need to think differently about how we innovate
and deliver the solutions we need and scale them up
rapidly for the business,” Moroney said. His company
has a number of “innovation vehicles,” he said, and
noted one called Shell TechWorks, a group of 50 to 70
people from outside the industry, which the company
established in Cambridge, Massachusetts.
“They are scientists; they are researchers from
medical, from defense, from high-tech,” Moroney said.
“They are entrepreneurs; they’re from startups. They
have brought in a whole new way of thinking about
innovation and matching up deep science with getting
the needs out to the field quickly.”
Olivier Le Peuch, president of completions at
Schlumberger, said that technology innovation to
improve efficiency is essential if deepwater development
is to remain sustainable. The industry must reduce risk,
complexity, contingencies, and the need for downhole
trips. He mentioned two new technologies that are
helping in these areas, a high-pull wireline system and
electric flow control systems.
Derek Mathieson, vice president and chief technology
and marketing officer at Baker Hughes, said that
industry thinking needs to move away from an “either/or
constraint,” such as focusing on “either new technology
or low cost” or “either rapid commercialization or
risk reduction.” Instead of treating such objectives as
alternative choices, they should be viewed as achievable
simultaneously. “How do we make that transition from
or to and?” he said.
Investment Continuing
Ram Shenoy, principal at Innovation Impact, a business
strategy consultancy, said that industry technology
investment is continuing in the current climate in focus
areas such as reducing rig time, increasing production,
and improving recovery rates.
Shenoy noted that deepwater and onshore
unconventional developments often involve similar
price tags over project life cycles but that deepwater
investment is front-loaded with slow cost recovery, while
investment in unconventionals is spread evenly with
speedy cost recovery. Deepwater cash flow profiles need
to become competitive with unconventionals, he said.
JPT • JULY 2016
Reducing Project Complexity
Complexity is the central challenge of
executing deepwater major capital proj-
ects, and the industry must find ways
to reduce it for future projects to be
viable, Chevron’s General Manager of
Facilities Engineering Mick Kraly told
a luncheon audience during the confer-
ence. “Major Capital Projects Yesterday,
Today, and Tomorrow: Is There a Need
for Change?” was his topic.
Kraly said companies must prove
capable of finding, developing, and
maintaining the competencies needed
to carry out these projects and over-
coming various performance gaps that
have become increasingly evident. The
industry must commit to increasing
standardization across multiple proj-
ects, come together to address major
technological challenges, and take full
advantage of joint industry projects
and the work of industry committees,
he said.
Deepwater projects are inherently
complex because of the increased reser-
voir recovery necessary to justify their
economics. “We’ve got to have the abil-
ity to do further technology deploy-
ments to be successful,” Kraly said. Proj-
ects involve seafloor pumps, may also
use in-well and electrical submersible
pumps, and can incorporate waterflood-
ing, which may be followed by enhanced
oil recovery. “Each of these adds a layer
of complexity,” he said.
Kraly presented a major consultant’s
analysis of a large number of deepwater
installations that showed widespread
performance gaps in the industry’s proj-
ect executions in the areas of meet-
ing schedules, keeping within budget-
ed costs, and attaining targeted startup
production. Only 18% of projects met
both their schedule and cost goals, and
a mere 8% met schedule, cost, and pro-
duction attainment goals. “If we don’t
change, obviously in this low-price envi-
ronment many projects are not going to
be viable,” Kraly said.
At the same time, the necessary tech-
nical capabilities for these major proj-
ects are not always available to the
extent desired. Chevron is addressing
these needs internally with a focus on
three areas:
JPT • JULY 2016
IHS: Markets Will Begin to Balance
Next Year
Trent Jacobs, JPT Senior Technology Writer
It may not come as a shock to anyone, but the next couple of years for
the oil and gas industry are likely to be defined by mediocre prices. That
was the message driven home by Atul Arya, senior vice president of IHS
Energy, in a talk at OTC.
“It is going to take a long time to get back to the good old days,”
he said. “We are in an oversupplied market and, for a change, the
fundamentals are working, but it will take us probably all of next year
to balance the market.”
Arya discussed at length the many factors affecting prices, and aside
from weak demand in China due to its slowing economy, the bigger
issues he emphasized involve the role that the Organization of the
Petroleum Exporting Countries (OPEC) is playing.
When prices headed south, OPEC responded by pumping out more
oil, which “has never really happened in the history of OPEC,” he said.
Much of that added production came from Saudi Arabia, which many
saw as taking up a defensive position to preserve its market share from
higher-cost producers. Many have also seen this decision as a key factor
in prolonging the downturn as it deluged an already flooded market.
And while some OPEC member nations are seeing declining
production, such as Venezuela, IHS believes the stronger members will
more than fill the gap as they add another 2 million B/D of “really low-
cost oil” to the market in the coming years.
The bulk of those new barrels will come from the Arab bloc that
includes Saudi Arabia, Kuwait, the United Arab Emirates, and Iraq. But
the major unknown remains Iran, which Arya said is still having issues
accessing financial markets months after the US and European Union
removed sanctions that stifled oil and gas production in the country.
“What happens to Iran over this year and next year is going to be
hugely important in terms of supply,” he added.
Another cause for pessimism involves the estimated 3 billion bbl of
oil in storage around the world. Arya said before a price recovery takes
hold, that oil must begin coming out of storage and into the refineries.
On the short list of things that are helping prices normalize is the
decline in US oil production. IHS estimates that US production peaked
at around 9.7 million B/D last year and will flatten out at around
8.6 million B/D over the next few years. The declines are almost
exclusively coming from shale production, which Arya said needs a
price point of approximately USD 50/bbl to stabilize.
“It’s a little bit of a chicken and egg situation,” he explained. “If the
price doesn’t go up, then we don’t see production going up. But the
price has to stay down for that production to go down because of the
reactivity of [shale] barrels to price.”
43
 Don Underwood, director of
subsea processing for FMC
Technologies, speaking at a
panel session in Houston.
Wind Could Be Pushing Offshore Oil Production
Stephen Rassenfoss, JPT Emerging Technology Senior Editor
Wind power could be used to pump oil from remote
offshore fields in the way windmills were once used to
pump water from wells in arid West Texas. The offshore
wind idea was offered by DNV GL, which did a study
showing that the wind offshore Norway is strong and
steady enough year round to provide the electric power
needed to inject 45,000 B/D of water into a remote
offshore field in water 200 m deep.
The study, which is the product of a seven-company
joint industry project (JIP) created by the Norwegian
classification and standards setting body, examined
ways to move the source of power close to where it
is needed. It is a natural idea for the offshore Europe
region, a leader in the growth of offshore wind capacity,
which is rising 37% a year.
“Wind on floating structures is developing rapidly
and we see a need for lower costs in oil and gas,” said
Johan Sandberg, segment director for floating offshore
wind, DNV GL. The JIP is now talking to oil producers
about working with them on the next stage, which
will move from a tabletop test using available data
to laboratory testing with a goal of preparing for an
offshore test.
The results presented at OTC suggest that there
are places where floating turbines can significantly
reduce the cost of powering injection pumps. The
results reflect the reality in a single field, located 33 km
away from its host platform and from land. The JIP
considered the cost of floating an unstaffed structure,
with a water processing plant on board treating the
water for injection. The floating wind turbine saves both
44
◗ Preservation of project materials
from purchase through final
installation.
◗ Shifting the management of single-
point inspections to an in-house
responsibility and redefining
the meaning and scope of these
inspections.
◗ Quality management of engineering,
procurement, and construction
(EPC) contractors, expanding the
level of it, and shifting it upward in
the project cycle to bring more of it
into the front-end engineering phase.
Increasing the industry standardiza-
tion of future projects is critical to their
successful execution, Kraly said. “We try
to simplify processes, workflow process-
es as well as engineering standards as
well as executional standards,” he said.
“We are challenging ourselves to stop
the cost of long lines for electricity and seawater for
injection from the host.
The study concluded that the capital expenditure
required for wind would be 39% lower than a
conventional electric generator in the case studied,
Sandberg said. On the other hand, the cost of
maintaining a huge, 6-MW floating turbine is greater
than the fuel cost of running a turbine. But the upfront
saving on capital expenditure advantage far exceeded
the operating expense difference.
While the study is focused on a single installation,
plenty of wells also have long tiebacks, making building
an umbilical out to them an expensive option, and more
are expected in the future.
Offshore wind power has become a huge growth
industry in the waters off northern Europe, but this
study appears to be a first effort to use it to serve
nearby platforms. At current prices, Sandberg said it
is attracting industry interest.
While this may well be possible elsewhere, there
are limits—oil production added from water injection
would need to be large enough to offer a return on
an investment of about EUR 75 million. Water depths
exceeding 1000 m would likely not be economic because
of the high cost of anchoring the unit to the seabed.
One of the biggest concerns going into the study
was whether the wind was sufficiently strong year
round. While the wind varies by season, and blows
strongest during winter, the study showed that in no
month did the process fall short of the goal of injecting
approximately 44,000 B/D of water, he said.
JPT • JULY 2016
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 doing this on an ad hoc basis and actual-
ly implement these as part of our overall
work stream. We have to take advantage
of standardization in the ability to deliv-
er things more repeatedly as well as more
cost-effectively.”
He recommended that companies
across the upstream industry and regu-
lators work together to enable the indus-
try to move forward, and cited high-
pressure/high-temperature (HP/HT)
technology as an area that could benefit
especially from such an initiative.
Recent discoveries in the Gulf of Mex-
ico present downhole environments that
will exceed the current 15,000-psi limits
of wellheads, casing liners, and blowout
preventers, and new HP/HT technologies
must be developed and qualified to oper-
ate in 20,000-psi settings. Internation-
al oil companies, EPC contractors, sup-
pliers, and regulators are sounding the
same message for this need.
“Let’s do this together,” Kraly said.
“Let’s just make sure that we have these
controls and standards and qualifica-
tions. Let’s make sure that the 20,000-psi
opportunities are done in the best way.”
Cost Savings for FPSOs
With the oil and gas industry facing an
uncertain financial future, organizations
are looking for any way to save costs. One
way to achieve cost savings is through
efficient planning in the construction
and conversion of floating production,
storage, and offloading (FPSO) units.
In a technical session, “Practical Steps
Toward FPSO Cost Reduction,” a series of
industry experts discussed the strategies
organizations may take.
Bryan Kendig outlined the opportu-
nities organizations have to lower costs
in purchasing oil and gas production
equipment and services for major off-
shore projects as described in OTC paper
27009. Kendig is a supply chain manag-
er at SBM Offshore. In the paper, Kendig

How Mexican Energy Reforms Have Affected the Service Sector

Trent Jacobs, JPT Senior Technology Writer

Of all the attention generated over the opening of the
Mexican oil and gas sector to the outside world, one
consideration has been largely left out of the discussion:
What does it all mean for service companies?
The energy reforms that became law in 2013 did not
specifically address how service companies will run their
businesses. And unlike the exploration and production
sector, which was monopolized by Pemex for more than
75 years, the service sector in Mexico has long been
open to many foreign and domestic companies.
However, the mere fact that there are now a number
of new exploration and production companies coming
to Mexico means change to the service sector is also
coming. Iain Cook, vice president of secure drilling
services at Weatherford, spoke on a panel at OTC
that addressed what impact the reforms may have
on service companies such as his.
Cook struck an optimistic tone with regard to the
size of the prize in Mexico and was especially upbeat
about the deepwater arena, which is seen by many as
virgin territory with the most potential.
“If you draw a comparison between the US Gulf of
Mexico and what has been drilled offshore Mexico,
there are more deepwater and ultradeepwater wells
drilled in the US waters compared to all offshore
wells in Mexico,” he said. “So there is a tremendous
opportunity for the deepwater drillers, a tremendous
opportunity for the service companies, and a
tremendous opportunity for technology implementation
as we go forward.”
The panel discussion also focused on contracting
schemes and how they might change. Cook said
operators in Mexico, both foreign and domestic, could
draw on some of the lessons learned in Iraq and Brazil—
two countries that have undergone similar transitions
as Mexico.
In Iraq, many contracts awarded were based on a
cost-recovery system that typically rewards service
companies on a fee-per-barrel rate. Cook said this
system creates more risk for service companies and
leads to less technology deployment.
By contrast, when Brazil opened up its offshore
sector to international companies to tackle the
challenges associated with tapping into pre-salt
reservoirs, many of the contracts were production-
sharing agreements. Cook said this approach resulted
in more capital and more technology being used and
very little risk for the service company.
Sergio Aceves, vice president of business
development at Mexican service company Diavez,
said one challenge for companies such as his will
be overcoming the growing pains associated with
transitioning into a business that owns and operates
fields outright. Diavez is one of a number of Mexican
companies who have worked for Pemex for years and
were awarded onshore fields to operate last year.
Aceves also noted that Mexican service companies
once wholly reliant on Pemex must find ways to
adapt to their new ecosystem, which will involve
building relationships with new partners who have
different expectations.
And now that operators can effectively own and sell
Mexican-produced hydrocarbons, they will press service
companies to drive down costs in order to achieve
wider margins than what may have been acceptable in
the Pemex-monopoly era.
Luis Escalante, director and general manager of FMC
Technologies’ Mexico business, said during his remarks
that the reforms represent an opportunity for service
companies to expand their locations to serve more
customers, optimize their supply chain strategies, and
develop a “culture of innovation.”

46 JPT • JULY 2016

and co-author Jim Wodehouse, vice pres-
ident of technology management at SBM
Offshore, recommended strategies orga-
nizations should take to maximize cost
reductions on future projects.
One recommendation is to use the
procurement department in a strategic
manner. Kendig and Wodehouse said
organizations should devote a sufficient
internal budget that is independent of a
client’s project budget so that procure-
ment methodologies can be developed
and implemented.
Other recommendations focus on
standardization. Kendig and Wodehouse
suggested that the standardization of
equipment, specifications, documenta-
tion, and working processes are good
economic practices, and organizations
should utilize them on offshore projects.
They also recommended that any major
cost reduction decisions with regards
to equipment or key vendors should be
made in a collaborative fashion, with a
team of stakeholders representing an
appropriate cross-section of functions
within the organization.
Kendig said vendors should play a crit-
ical role in identifying cost-reduction
opportunities. However, he also de-
scribed the process of working with
equipment vendors as “scattered” and
Disruption on the Horizon: OTC d5 Presents
Thought-Provoking Visions of the Future
Trent Jacobs, JPT Senior Technology Writer
W e are living in an age of disruption.
If you question that assertion, just
reach into your pocket. In less than a
decade, a combination of the Internet,
smartphones, and the myriad of apps
developed to run on them have obliter-
ated a growing number of once-lucrative
business models.
Countless brick-and-mortar music
stores have been replaced by iTunes
and Spotify. Kodak has been replaced
by Instagram. The global taxi trade is
being redefined by Uber. Expensive long-
distance phone calls and over-priced text
messages are now free thanks to Whats-
App, Viber, and Skype.
JPT • JULY 2016
that it is not realistic for companies to
expect vendors to reduce their budgets
by significant margins.
“Energy is feeling a transition, espe-
cially offshore,” he said. “We’re the first
ones to feel the brunt. But, some of our
vendors are catering to other markets, so
the 50% reduction isn’t there for those
vendors. I can tell you from previous
experience putting together proposals
that it’s been a long time since I’ve seen
gross margins from vendors that were
more than 20%.”
Technology development was another
focus of Kendig’s presentation. In their
paper, the authors recommend that proj-
ect developers, vendors, and EPC con-
tractors should collaborate to iden-
tify and develop the technologies that
will lead to cost reductions prior to the
awarding of the EPC contract.
Kendig said he wants to see the indus-
try approach cost reduction in the
same manner in which it approaches
technology development. He suggest-
ed the development of a joint-industry
program targeting things like the cre-
ation of standards for documentation
and certification.
“I am very passionate about improving
costs and seeing what we can do with-
in the industry from a supply chain per-
And this is only the beginning. The
disruption these consumer-friendly
technologies are causing to the retail
and service sectors will pale in com-
parison to the changes coming to ener-
gy supply and the entire global econo-
my. This prognostication comes from
Vivek Wadhwa, a renowned tech-
nology researcher and a fellow at
Stanford University.
“Every industry will be disrupted,” he
said. “As technology advances, it becomes
more powerful, it becomes smaller, and it
becomes cheaper. It democratizes so that
anyone, anywhere can now use it to build
world-changing solutions.”
spective,” he said. “Let’s pull some things
out we can repeat from one project to the
next project. I would really like to see this
stick to the wall. I’ve been in the indus-
try for 27 years. I’ve seen the ups and the
downs. The ups come around, and we
tend to forget the things we were trying
to do [during the down periods].”
Kendig was one of seven speakers to
present a paper at the technical session.
In another presentation, Kees van Roos-
malen, a managing director at Nevesbu,
discussed the lessons learned from his
company’s experiences engineering FPSO
conversions. In OTC paper 27053, van
Roosmalen said thorough preparation is
key to cost-effective ship conversion.
“FPSO conversion requires that you
know what you’re going to do when you
start doing it,” van Roosmalen said. “You
need to have phased growth. You need
to know what you’re going to do in what
sequence. You need to have good prepa-
ration and good [front-end engineering
design]. You need to manage your sub-
contractors and vendors because many
of them are delivering projects tailored to
the FPSO you are looking at.”
JPT staff Stephen Rassenfoss, Trent
Jacobs, Joel Parshall, and Stephen
Whitfield contributed to this report.
Wadhwa was the keynote speaker at
SPE’s second annual d5 event on the
Friday after OTC. Held at Rice Univer-
sity in Houston, the meeting featured
speakers with various backgrounds in
digital technology and oil and gas who
shared their ideas on how to challenge
the status quo.
Wadhwa’s message to the audience of
oil and gas executives from around the
world was that technology development
is on an exponential path, and that there
is no turning back.
Over the next few years, he said the
world will witness the rapid maturation
and convergence of robotics, 3D printing,
47
 Larry Tesler
low-cost sensors, artificial intelligence,
and high-performance computers. There
will be unprecedented benefits, but also
plenty of upheaval to go around.
For instance, Wadhwa is an investor in
an Indian-based startup that makes an
affordable and portable computer capa-
ble of running a battery of medical tests
that typically require a visit to the clinic
or hospital.
Comparing it to the fictional tricorder
device made famous by Star Trek, he said
the new invention will not only revolu-
tionize health care in the poorest parts
of the world, but it will also present an
attractive alternative to patients in rich
countries frustrated by long wait times
that end with an examination by a doctor
that lasts an average of only 7 minutes.
On the flip side, when robotics-based
manufacturing takes hold next decade,
Wadhwa predicted that China’s economy
will collapse as companies in the US and
elsewhere relocate factories back to their
home countries. He said China is unable
to avoid this future despite a billion-
dollar initiative to build “zero-labor” fac-
tories that use robots instead of human
workers. “The problem for them is that
their robots are no harder working than
ours are,” he explained.
But for many of those in the room, the
most relevant piece of Wadhwa’s remarks
was his forecast for the energy sector. For
48
those in the fossil fuel business, the out-
look may be a little nerve-wracking.
“We’re headed into an era of unlimited,
clean, and almost-free energy—this is a
reality whether we believe it or not,” he
said. “By 2020, it will cost half as much to
store energy and half as much to capture
energy than it does today. In 2025, it will
cost an eighth as much.”
What does all that mean for the oil and
gas industry? According to Wadhwa, just
one word: “toast.” There will still be some
need for oil and gas in the decades to
come, but he believes the era of demand
destruction has already begun and will
be accelerated by electric, driverless cars
and solar power generation.
The cost of solar power has been driv-
en down dramatically in recent years and
Wadhwa said that with each 20% drop,
the number of installations around the
globe doubles. He noted that many gov-
ernment subsidy programs ended last
year, yet solar power remains “an unstop-
pable force” and may supply 100% of US
electricity demand in 40 years.
Recycle the Research
A discussion led by Larry Tesler, the
inventor of the cut, copy, and paste com-
mand on personal computers, merged
the topics of management and technol-
ogy. Tesler, who has held various leader-
ship roles at Apple, Yahoo, and Amazon,
Vivek Wadhwa
stressed the importance of not letting
good ideas go to waste even if the prod-
uct line they were initially dreamed up
for was a flop.
“Identifying the next big thing may
take several tries,” he cautioned. “If
you do something too early, then it’s
not going to be high-performing. If you
do it too late, your competitors will get
there first.”
When a technology fails upon launch,
companies should identify its most suc-
cessful elements and then find new ways
to leverage them. Two ideas Tesler pro-
posed were to license the technology to
others and to spin off the team that devel-
oped it into a startup to allow investors to
share the risk.
Tesler drew on personal experience
from the time he worked at Xerox’s
research facility in Palo Alto, Califor-
nia, to talk about the do’s and don’ts of
managing corporate research. He was
among only a few people in the room
when the company’s cutting-edge com-
puter technology was demonstrated for
Apple cofounder Steve Jobs in the win-
ter of 1979.
The meeting has become a fixture
in the pantheon of Silicon Valley folk-
lore because it is where Jobs was pre-
sented with, and then appropriated, the
computer mouse and the window-based
graphical user interface. Months later,
JPT • JULY 2016
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evolution to
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 Larry Tesler speaks at Rice
University in Houston where
he explained to oil and gas
professionals how their
companies can find value in
technologies that failed to
have commercial success.
Jobs would also lure Tesler away from
Xerox to join Apple.
Fast forward to today, Xerox is merely
a footnote in the history of personal com-
puting and Apple is the world’s largest
computer company by revenue.
Tesler said there were a number of
other factors behind Xerox’s failure to
take advantage of its own innovations.
One was the company’s refusal to redirect
resources from its copier business to sup-
port the growth of its computer busi-
ness. This resulted in Xerox’s personal
computers costing 13 times more than
the competition.
“Disrupt or be disrupted,” is the lesson
to be learned here, Tesler said. “Put it that
way, and maybe you can sell your company
on going in and taking some big risks.”
Tesler said Xerox made many of the
same mistakes years later when it missed
the chance to capitalize on the low-end
laser printing market. He hinted that
things may have turned out differently
had there been better communication
between Xerox’s headquarters in Connect-
icut and its research center in California.
“The research center and corporate
have to be engaged with each other,”
he said. “Someone who has only been
50
in engineering organizations, and never
was close to a research organization, will
have expectations that are just not real-
istic. But vice versa, the research people
have to understand that what they are
doing won’t make a difference unless it
turns into a product.”
Diversify and Conquer
The importance of engagement was also
a central theme in a presentation given
by Gindi Vincent, an author and coun-
sel at ExxonMobil. Citing recent studies,
she said only 30% of the American work-
force feels engaged with their job.
Part of the problem is that too many
companies are focused on financial goals
alone, which Vincent explained is not a
top priority for the average worker. “It’s
not the money, but the mission” that
drives most people, she said.
As a student of the brave leadership
philosophy, Vincent said managers need
to stop surrounding themselves with peo-
ple who look like them and start building
diverse work teams made of individuals
with different backgrounds and perspec-
tives. This improves creativity which she
said is one key to staying relevant for the
long term.
Vincent also recommended that
companies look for innovative ways to
improve internal communication and
encourage employees to give their feed-
back and submit more of their own ideas.
One example she provided was a com-
pany that uses television monitors in
its common spaces to play short videos
of different employees describing their
accomplishments at work.
“I know that can be very logistically
hard to manage and that the bigger the
organization the more challenging it can
be, but the more critical it is the bigger
the organization is,” she said.
She also spoke about the tough times
many upstream oil and gas companies
are going through as they manage a
nervous and dispirited workforce. Her
advice on keeping morale up is to estab-
lish short-terms goals for employees
to reach for and to “tout the wins” as
they come.
One thing companies should avoid
trying is to improve morale with office
perks, which she said do not work. “Giv-
ing someone a cappuccino bar is not what
is going to engage the workforce,” she
said. “It is going to be driven by person-
ality and by leadership.” JPT
JPT • JULY 2016
CONFERENCE PREVIEW
SPE ATCE To Focus on Industry Transformation
Joel Parshall, JPT Features Editor
SPE will hold its Annual Technical Con-
ference and Exhibition (ATCE) from
26  September through 28 September at
the Dubai World Trade Centre, Dubai,
United Arab Emirates (UAE). Transform-
ing and shaping the future of the explora-
tion and production (E&P) industry will
be the theme of the meeting. It will be
the first time in the 92-year history of the
ATCE that the event has taken place in the
Middle East.
The conference will provide an unpar-
alleled opportunity for learning and col-
laboration at workshops and training
courses, while the concurrent exhibi-
tion will showcase the latest technologies
from around the world. More than 250
companies and organizations are expect-
ed to exhibit. Oil and gas professionals
from at least 70 countries are expected to
attend the ATCE.
A high-quality slate of 58 technical ses-
sions is scheduled covering all aspects of
the upstream oil and gas industry. More
than 450 peer-selected papers will be
presented, which were chosen from more
than 2,100 abstracts submitted.
Two plenary sessions, six panel ses-
sions, and 13 special sessions are on the
program, focusing on short- and long-
term challenges affecting areas such as
business strategies, project management,
innovation, young professionals’ devel-
opment, academia, and mature fields.
Plenary Sessions
On the 26 September agenda are two
plenary sessions, the first in the morn-
ing and the second in the afternoon.
Both will examine the conference theme
“E&P 2.0—Transforming and Shaping
the Future.”
A diverse group of global E&P industry
chief and senior executives will serve as
JPT • JULY 2016
Al-Adsani Al Jarwan
Craighead Kibsgaard
panelists for the sessions: Nizar Moham-
mad Al-Adsani, deputy chairman and
chief executive officer (CEO) of Kuwait
Petroleum; Ali Al Jarwan, executive
advisor at Abu Dhabi Marine Operating
Company; Mohammed Y.A. Al-Qahtani,
senior vice president of upstream at
Saudi Aramco; Arnaud Breuillac, presi-
dent of exploration and production at
Total; Martin Craighead, chairman and
CEO of Baker Hughes; Paal Kibsgaard,
chairman and CEO of Schlumberger;
David J. Lesar, chairman, president, and
CEO of Halliburton; D.K. Sarraf, chair-
man and managing director of Oil and
Natural Gas Corporation; Datuk Anuar
Taib, executive vice president and CEO
of upstream at Petronas; and Vadim
Yakovlev, deputy chairman of the man-
agement board and first deputy CEO of
Gazprom Neft.
Panel Sessions
Six panel sessions are scheduled
throughout the conference, begin-
ning on 26 September with Radical New
Ideas: Innovation Beyond the Limits. On
27  September, panels will discuss Proj-
ect Management: Getting It Right; Boost-
ing Efficiency in E&P; and Collaboration
Al-Qahtani Breuillac
Lesar Sarraf
Taib Yakovlev
2.0—Reinventing the E&P Industry. The
panel sessions conclude on 28 September
with Successful Strategies for Mitigat-
ing the Effect of Boom and Bust; and The
Next Generation (YP 2.0): Talent Man-
agement for Future Energy.
Special Sessions
A robust slate of 13 special sessions is
scheduled, including
26 September
◗ Big Data, Analytics and Impact
◗ Increased Water Cut—How to
Handle
◗ Processes and Technologies
27 September
◗ How is Academia Managing in
a Cyclic Environment?
◗ The Way To Move Forward is
To Look Back
◗ Women in Leadership: The Value
of Gender Diversity in Leadership
51
 ◗ Unconventional and Tight Gas
Reservoirs
◗ Human Capital and the Impact
of Low Oil Prices
◗ Local Content and Diversity
◗ Managing the Oil Industry Cycles:
Employee, Student, and Employer
Perspective
28 September
◗ Getting the Most From Mature
Fields
◗ New Technologies and People
Competencies for Integrated Flow
Assurance Solutions
◗ Exploration 2.0
Annual Events
◗ On 26 September, a breakfast will be
held honoring the SPE Distinguished
Lecturers and members of the
25-Year Club.
◗ On 27 September, the Annual
Reception and Awards Banquet
at the JW Marriott Marquis will
recognize significant contributions
of members to the industry, SPE,
and the greater community. A
reception will precede the banquet.
◗ On 28 September, the President’s
Luncheon and Annual Meeting
of Members will be held. The
luncheon showcases 2016 SPE
President Nathan Meehan’s
presentation on new achievements
at SPE and upcoming initiatives.
SPE’s newly elected Distinguished
Members, notable volunteers,
and outstanding SPE sections will
also be recognized. Attendees
will be able to meet SPE Board
members and 2017 SPE President
Janeen Judah, who will receive the
presidential gavel and officially
begin her term.
Training Courses and
Technical Sections
Ten professional training courses will
be held covering a variety of technical
disciplines, including four 2-day courses
on 24–25 September, a 1-day course on
25 September, and five 1-day courses on
29 September. Participants will receive
1.6 continuing education units (CEUs)
for 2-day courses and 0.8 CEUs for
1-day courses.
52
SPE technical sections will also hold
meetings, including
25 September
◗ Drilling Systems Automation
Technical Section symposium
26 September
◗ Projects, Facilities, and Construction
Technical Section dinner
◗ Multisection dinner (Digital Energy,
Petroleum Data-Driven Analytics,
and R&D technical sections)
27 September
◗ R&D Technical Section topical
luncheon
◗ Wellbore Positioning Technical
Section luncheon
Other Events
◗ The ATCE Welcome Reception
will take place at the JW Marriott
Marquis Hotel on 25 September.
Dubai’s traditional arts and culture
will be showcased.
◗ Attendees wishing to improve
their ability to submit papers
can participate in a session titled
“How To Write a Good Technical
Paper” on 26 September.
◗ Soft skills workshops on
leadership, strategic tools for
career success, marketable team
skills, and strategic planning will
be held on 27 September.
◗ ENGenious, a JPT-sponsored
showcase of young technology, will
be held throughout the conference.
Students and Young
Professionals
A Student Meet and Greet event will take
place in the afternoon on 25 September.
Special activities will help attendees meet
and network with fellow students.
The 15th annual PetroBowl will be held
on 26 September. Teams from around
the world will take part in a tourney-type
contest that will challenge their knowl-
edge of the oil and gas industry and SPE.
A reception will follow.
The International Student Paper Con-
tests will take place on 27 September.
Winners of regional contests will com-
pete for prizes at the undergraduate,
graduate, and PhD levels.
A Student Communication Workshop
will be held in the morning on 27 Septem-
ber. For those unable to attend, the work-
shop will be repeated on 28  September.
Students will work in small groups to
hone their networking abilities, refine
their communication skills, and build
up a toolkit of essential knowledge for
their careers.
The Student Awards Luncheon will
take place on 27 September. SPE will
honor outstanding student chapters and
the winners of the student paper contests
and PetroBowl.
A Career Pathway Fair with Career
Breakout Sessions will be held on 27 Sep-
tember. Students will meet with spe-
cialists from multiple disciplines in the
industry to gain insight into different
career paths, how those paths fit into the
industry, and what it is like to work in a
particular discipline. In an informal set-
ting, students and graduates will have
the opportunity to speak with young pro-
fessionals and more experienced indus-
try hands.
A Young Member Reception will take
place in the evening on 27 September.
SPE’s energy education outreach pro-
gram Energy4me has invited 50 UAE
high-school-level science teachers to a
free 1-day energy education workshop on
27 September. The teachers will receive
hands-on training by qualified SPE facil-
itators, listen to a presentation from a
prominent keynote speaker, and tour
the ATCE exhibitions. In addition, the
teachers will receive a variety of free
instructional materials to take back to
their classrooms.
On 28 September, approximately
150  UAE high school students will see
firsthand the opportunities the indus-
try has to offer. The free program spon-
sored by Energy4me will include a scav-
enger hunt of the technology exhibits
and hands-on energy lessons led by qual-
ified SPE facilitators. The students will
also have the opportunity to meet indus-
try professionals and ask questions about
careers in the E&P industry.
SPE Pavilion
At the SPE Pavilion, staff members will
be available to answer questions about
membership, publications, continuing
education programs, sections, and stu-
dent activities. JPT
JPT • JULY 2016
MANAGEMENT
Solving the Casing-Wear Puzzle Using
Stiff-String Model
Robello Samuel, Aniket Kumar, and Adolfo Gonzales, Halliburton, and Sylvester Marcou and
Anne Mette Rød, Statoil
Precise casing-wear prediction is impor-
tant for improving well integrity and
longevity, while simultaneously making
casing designs more cost-effective. Cur-
rently, there are no known and com-
monly accepted guidelines available in
the industry. Several studies have been
presented in literature over the past cou-
ple of decades that proposed various
methods for estimating the downhole
wear in casings. However, the results of
all such efforts have been mixed. Pre-
dicted values of casing wear using wear
models failed to accurately match the
wear logs from the wells when scaled
up to the field level. This has led to a
perception in the industry that existing
casing-wear prediction methods lack the
desired accuracy.
Many of these suspicions are unwar-
ranted and have emerged because of
inconsistencies in accurately apply-
ing the casing-wear model. Kumar and
Samuel (2015) have previously present-
ed a comprehensive treatise on all the
uncertainties involved in casing-wear
analysis and the underlying modeling
method and parameters. This article
proposes a new modeling method for
casing-wear prediction using stiff-string
analysis, aiming to reduce the existing
uncertainties in downhole wear esti-
mation. In addition to estimating more
accurate side forces, the stiff-string
model also predicts the contact posi-
tion of the drillstring at any given depth
in the casing. These contact positions,
at any given casing depth cross-section,
are used to model the development of
multiple wear grooves around the cross-
section, as various wellbore operations
are conducted through the casing. Fur-
ther details of this modeling method
have been presented in this study.
JPT • JULY 2016
The proposed model has been validat-
ed using measured wear-log data from an
offshore well in the North Sea. The value
of the maximum wear-groove depth,
along with its respective azimuthal loca-
tion at that casing cross-section mea-
sured using the wear logs, were com-
pared with the simulated values for the
entire logged-casing section.
Casing-Wear Model
This modeling approach has been slightly
modified while being applied to address
the different kinds of operations that are
performed to successfully drill a well.
Five major operations are considered in
this analysis—drilling, backreaming,
rotating off-bottom, sliding, and recipro-
cation. This study focuses on wear caused
only by the above operations, which can
be performed in different sequences to
reach the target depth. Other possible
reasons for downhole wear, such as ero-
sion while fracturing, corrosion, or any
other mechanical wear during produc-
tion, are not considered in this analysis.
For the drilling and backreaming oper-
ations, Eq. 1 has been applied for analy-
sis. The drilling or backreaming opera-
tion starts from a given measured depth,
and the drill bit progresses farther down
(drilling) or up (backreaming) the hole
to reach the target end depth for that
operation. As a result, the tool-joint con-
tact with the inner casing wall varies as
the drillstring moves down or up the
hole. The last factor in Eq. 1, the ratio of
tool-joint length over drillpipe length, is
applied to account for this contact result-
ing from tool joints only. The average
side force supported by the tool joints
is calculated using Eq. 2, assuming that
the entire load is taken solely by the tool
joints and there is no pipe-body contact.
WV=Wf ×SFtj×π×Dtj×RPM
×60×t×Ltj /Lp . . . . . . . . . . . . . .(1)
SFtj=SFft×Lp /Ltj . . . . . . . . . . . . . . .(2)
Torque-and-Drag Models:
Soft-String vs. Stiff-String
Equations 1 and 2 for wear modeling
clearly suggest that the key to successful-
ly predicting the downhole casing wear
lies in being able to accurately estimate
the normal contact load or side forces
acting between the tool joints and the
inner casing wall.
The soft-string torque-and-drag
model, which is often considered as the
industry standard, has been convention-
ally used for all wear-modeling purposes.
This model is considered to represent
the real drillstring behavior by neglecting
the bending stiffness of the string com-
ponents so that the entire length of the
string behaves as a cable or chain. It also
assumes that the drillstring trajectory
is the same as the wellbore trajectory to
solve the wellbore contact problem, and
the contact is further assumed to be con-
tinuous along the wellbore.
Even though these assumptions work
well for conventional torque-and-drag
analysis, they fail to fulfill the underly-
ing requirements for accurately model-
ing casing wear. The wear groove predict-
ed using the soft-string model is assumed
to be concentrated only at one particular
location on the low side for any casing
cross-section, which does not corrobo-
rate the field observations of worn-out
casings. Hence, to overcome these exist-
ing challenges, a more comprehensive
stiff-string model has been applied for
wear analysis in this study.
Mitchell and Samuel (2009) have pre-
sented a detailed background on the
53

Fig. 1—Remaining casing-wall thickness comparison with ultrasonic log for the
high-wear zone.
drawbacks of the soft-string model and
have developed a more comprehensive
stiff-string model that accounts for the
bending stiffness of the components and
accurately estimates drillstring contact
points in the wellbore rather than assum-
ing continuous contact. This model is
considered more appropriate for
advanced wear analysis. The stiff-string
model estimates more accurate side forc-
es, particularly for high-dogleg wells,
as the soft-string model has limitations
in such scenarios. Estimating multiple
wear-groove locations using stiff-string
modeling is also expected to reduce the
over-prediction of wear, which has been
one of the major drawbacks of the soft-
string model. The detailed method of
modeling multiple wear grooves can be
referred to in the paper SPE 178833.
Well Log Comparison
and Validation
The results of the modeling simulation
were compared with the ultrasonic wear
log run in an offshore deviated well from
the North Sea. Only the 9⅝-in. casing
section was logged between the depths
of 9,445 ft and 16,540 ft. The values of
the minimum remaining wall thickness
54
from the ultrasonic log have been com-
pared with the minimum remaining wall
thickness estimated from the modeling
approach proposed by this study.
Investigation of this wear-log compari-
son with the model was divided into two
parts—the high-wear zone between the
depths of 9,445 ft and 11,400 ft and the
low-wear zone between 11,400 ft and
16,540 ft, which was the bottom of the
logged section. The wear-log compari-
son of the high-wear zone has been more
closely highlighted in Fig. 1. Here, the
peaks of the ultrasonic wear log lying
outside the manufacturing tolerance
limit correspond well with the wear dis-
tribution for this zone predicted using
the model. Estimated wear percent for
the worst groove at any casing cross-
section falling in the high-wear zone
varied from a minimum of 10% wear to
a maximum of 26% wear.
The slight variations in wear between
the measured log values and the estimat-
ed values using the model are attributed
to some of the underlying uncertainties
in the input parameters that we used for
modeling. As suggested by Kumar and
Samuel (2015), total wear predictions
are heavily influenced by parameters
like well path, survey frequency, multiple
wear factor distribution along the cas-
ing or the drillstring, operation parame-
ters like weight-on-bit or revolutions per
minute, and the downhole wellbore con-
ditions. Variation or inaccuracies in any
of these input parameters would in turn
influence the final predicted wear.
The model over-predicted the amount
of wear when compared with the wear log
in the low-wear zone between the depths
of 11,400 ft and 16,540 ft. This zone was
further examined to investigate any pos-
sible underlying causes that may have
contributed to this over-prediction. After
careful analysis, it was considered that
the comparison between the model and
the wear log had limitations when the
measured and calculated wear was below
the pipe tolerance limit. This may have
resulted from a lack of a base log to iden-
tify the actual casing inner diameter to
run the wear simulations or some limita-
tions on the logging tool.
The other important parameter that
has been used for validation and compar-
ison between the wear log and the model
is the azimuthal location of the worst
wear groove at any casing cross-section
in the logged zone. Such comparisons
between the measured azimuthal loca-
tion of wear grooves and modeled loca-
tion of wear grooves have not been per-
formed before for casing-wear analysis
in the industry and will help to further
understand the accuracy of the underly-
ing modeling method.
Fig. 2 shows the wear-groove posi-
tion comparison between the modeled
wear grooves and the ultrasonic wear
log. Out of the multiple wear grooves
modeled using the proposed method, the
azimuthal location of the worst groove
having the maximum groove depth has
been compared with the log. The high
side of the wellbore is considered to be
0° in the used convention, and the cas-
ing cross-section is traversed in a clock-
wise direction to model multiple grooves.
The logged location of the wear grooves
using the ultrasonic log again correlate
very well with the location of the worst
groove, as estimated by the model. It
should be noted that the entire logging
depth lay in the deviated section of the
wellbore; hence, maximum wear was
JPT • JULY 2016
caused on the low side of the casing. Both
the measured and the predicted values
in Fig. 2 further confirm this observa-
tion, as most of the groove locations fell
on either side of 180°, which represented
the low side.
Fig. 3 shows the multiple wear grooves
estimated at a particular depth of the
casing section—at 10,400 ft, where we
Depth Along Casing (ft)
observe one of the peaks of the logged
casing section. This depth lies in the devi-
ated section of the well, and, convention-
ally, one single wear groove should have
been expected in the low side. However,
the azimuthal contact locations predict-
ed using the stiff-string model show that
the wear was distributed between mul-
tiple wear grooves lying between 90° and
180° of the casing cross-section based on
the clockwise convention specified ear-
lier. This location of the maximum wear
groove has been marked here with an
orange pointer. The location of the worst
wear groove predicted by the model at
this depth correlates very well with the
azimuthal location of the groove as mea-
sured by the ultrasonic log at the depth of
10,400 ft. This comparison can be clearly
drawn from Fig. 2.
Conclusion
This study focused on providing a solu-
tion to the casing-wear problem that has
perplexed the industry for more than a
couple of decades. A new, more compre-
hensive casing-wear modeling approach
0°
73°
270° 90°
188° 180°
Fig. 3—Casing cross-section looking
downhole, showing multiple wear-
groove predictions at the depth
of 10,400 ft. The location of the
maximum wear groove is marked
with an orange pointer.
JPT • JULY 2016
0 50
9,000
10,000
11,000
12,000
13,000
14,000
15,000
Model
16,000
Wear Log
17,000
Fig. 2—Wear-groove position comparison with ultrasonic log.
using the advanced stiff-string torque-
and-drag model has been proposed
to estimate the development of multi-
ple wear grooves for any casing cross-
section. Wear resulting from any of the
five different operations, namely drill-
ing, backreaming, sliding, rotating off-
bottom, and reciprocation, has been
modeled and presented. The sequen-
tial combination of any of these opera-
tions performed has also been accounted
for while predicting the total downhole
casing wear. This proposed method is
expected to reduce the over-prediction
of wear that was commonly observed
when using the conventional soft-string
model, because the wear is now dis-
tributed among multiple wear grooves
to more accurately simulate the actual
downhole conditions. JPT
Nomenclature
Dtj =Tool-joint outer diameter, in.
Lp =Length of drillpipe, ft
Ltj =Length of tool joint, ft
RPM =Rotary speed of drillstring,
rev/min
SFft =Side force per ft of drillpipe,
lbf/ft
Groove Position (°)
100 150 200 250 300 350
SFtj =Side force acting on the tool
joint, lbf
t =Operation time, hr
Wf =Wear factor, E-10/psi
WV =Wear volume, in.3/ft
References
Kumar, A. and Samuel, R. 2015. Casing
Wear Factors: How do They Improve
Well Integrity Analyses? Presented at
the Society of Petroleum Engineers/
International Association of Drilling
Contractors Drilling Conference
and Exhibition, London, UK, 17–19
March. SPE 173053. http://dx.doi.
org/10.2118/173053-MS.
Mitchell, R. and Samuel, R. 2009. How
Good Is the Torque/Drag Model? SPE
Drill & Compl 24 (1): 62–71. http://dx.doi.
org/10.2118/105068-PA.
Samuel, R., Kumar, A., Gonzales, A. et al.
2016. Solving the Casing Wear Puzzle
Using the Stiff String Model. Presented
at the International Association of
Drilling Contractors/Society of Petroleum
Engineers Drilling Conference and
Exhibition, Fort Worth, Texas, USA,
1–3 March. SPE 178833. http://dx.doi.
org/10.2118/178833-MS.
55
 TECHNOLOGY FOCUS

Reservoir Simulation
William J. Bailey, SPE, Principal, Schlumberger-Doll Research

Reservoir-simulation-model inputs are Multiscale, which has been
numerous, and uncertainty is perva-
sive—before, during, and after devel- the subject of ongoing
opment. On top of that, there is always study over the past decade,
pressure to deliver quality results as
quickly as possible. This gives rise to
knits together geometrical
a simple question, one that has yet to quantities (dimensional
find a simple answer: How refined is scale) with tailored
refined enough and how coarse is too
coarse? I run the risk of oversimplifica- computational schemas
tion here, but it seems we are faced with (numerical scale).
a classic dichotomy, one that is exacer-
bated by the pull of advances in high-
performance computing that permit Dimensional scale represents just one
ever-greater model refinement, while, aspect of the term “multiscale,” which I
simultaneously, we have the push of have mistakenly taken to mean just the
(possibly stochastic) sampling of uncer- juxtaposition of, essentially, geometrical
tainty, thereby encouraging the devel- scale within a single model (such as that
opment of simplified (or surrogate) found in coupling a simulation grid and
models that can run hundreds, even the wellbore). The large ratio associat-
thousands, of times. The question is one ed with domain size, and the resolution
of striking the right balance between of the geological data, is usually man-
two apparently contradictory approach- aged by upscaling. However, so-called
es to simulation. The adage “horses for multiscale methods represent a new ave-
courses” is not particularly helpful in nue of research, one that may provide a
itself, even though it is probably appro- bridge between the aforementioned push
priate. Does one have two distinct mod- and pull of refinement resulting from
els with roughly commensurate scal- the needs of different decision makers.
ing, or can we build a single all-purpose Multiscale, which has been the subject of
model with different scales within it ongoing study over the past decade, knits
that is both fast and accurate with multi- together geometrical quantities (dimen-
scale grid? sional scale) with tailored computation-
William Bailey, SPE, is a principal at Schlumberger-Doll Research,
Cambridge, Massachusetts. His primary technical interests lie in
reservoir engineering, multiphase flow in conduits, and optimiza-
tion of expensive functions. Bailey has contributed to more than
50 articles (almost half peer-reviewed) and holds 10 patents. He
holds MEng and PhD degrees in petroleum engineering and an
MBA degree. Bailey has held various positions in SPE, including
technical reviewer for various SPE journals, and currently serves
on the SPE Books Development Committee and the JPT Editorial Committee. He can
be reached at wbailey@slb.com.
al schemas (numerical scale). This mul-
tifaceted multiscale concept may offer a
means to construct an accurate coarser-
scaled model, one honoring the attributes
of the fine-scale heterogeneous geologi-
cal data from both numerical and spatial
standpoints. This method class computes
local basis functions for the solution vari-
ables, to construct a smaller (coarse) sys-
tem for computing an approximate solu-
tion on the original simulation grid.
While it is too early to say whether this
broader notion of multiscale (numerical
and geometrical) will provide a single,
unifying, model for engineers, it is possi-
ble that this, or some other such method,
may strike that elusive balance between
refinement (accuracy) and surrogacy
(speed). For those interested in reading
up on this topic, the peer-reviewed SPE
papers SPE 119183 and SPE 163649 pro-
vide more detail and clarify the status of
some ongoing research. JPT
Recommended additional reading
at OnePetro: www.onepetro.org.
SPE 169063 Application of Multiple-
Mixing-Cell Method To Improve Speed and
Robustness of Compositional Simulation
by Mohsen Rezaveisi, The University of
Texas at Austin, et al.
SPE 177634 Multiscale Geomechanics:
How Much Model Complexity Is Enough?
by Gerco Hoedeman, Baker Hughes
SPE 174905 Experimental Design or
Monte Carlo Simulation? Strategies for
Building Robust Surrogate Models by Jared
Schuetter, Battelle Memorial Institute, et al.
SPE 169357 Reduced-Order Modeling
in Reservoir Simulation Using the
Bilinear Approximation Techniques
by Mohammadreza Ghasemi, Texas A&M
University, et al.

56 JPT • JULY 2016

Project Tests High-Performance
Cloud Computing for Reservoir Simulations

I n the upstream oil and gas

industry, cloud computing is very
immature because the industry has
25

20
always been challenged by storage
and computational capability. 15
However, there is recent evidence for
considering high-performance cloud 10
computing (HPCC) because of the
promise of benefits such as flexibility, 5
accessibility, and cost reduction. HPCC
may create an opportunity for small 0
to midsized upstream companies 1 2 4 8
that do not want to invest in the
Number of CPUs
infrastructure needed for evaluating
scientific applications.
Internal Cloud

Project Overview
The target of this project was to prove Fig. 1—Relationship between CPU time and wall-clock time of calculations
the concept of running simulation soft- done internally and on cloud servers.
ware in a high-performance comput-
ing cloud and use the findings to design ◗
HP_ICLOUD_8 on the ECL server Assuming that this linear scaling
a framework or methodology enabling with eight CPUs persists when adding more than eight
companies to pursue business oppor- The four cases showed identical re- CPUs and extrapolating from this ob-
tunities iteratively while learning along sults for oil-production rate and cumu- servation, it is hypothesized that, for
the way. The outcome of the method- lative oil for the duration of the field larger jobs, the performance of the
ology is a dynamic tactical and stra- history, as expected. cloud servers would increase signif-
tegic roadmap that leverages trends The case with a single CPU was com- icantly compared with what can be
in HPCC. pleted in approximately 20 hours. The achieved internally.
run times with four and eight CPUs were
Calculations and Results 7.7 and 5.7 hours, respectively. Overall Setup
The following cases were run on a local Fig. 1 shows that wall-clock time de- The goal of the overall design was to
cluster at an early stage for the purpose creased as more CPUs were added, both simulate a real-life corporate network
of run validations: for calculations performed internally within a cloud scenario. Therefore, a
◗ HP_ICLOUD on reference and for those performed on the cloud virtual private cloud (VPC) was first
workstation with one central servers. It was also observed that inter- set up in the cloud server’s data cen-
processing unit (CPU) nal calculations stagnated at more than ter to act as the corporate network.
◗ HP_ICLOUD on the Enterprise four CPUs (i.e., sublinear scaling). On Next, a second VPC was set up in a
Cloud (ECL) server with one CPU the other hand, close to linear scaling separate data center to serve as the
◗ HP_ICLOUD_4 on the ECL server was observed when calculations were cloud network.
with four CPUs run on the cloud servers.
Network Setup
A major challenge was how to connect
This article, written by Special Publications Editor Adam Wilson, contains highlights
the physical Universal Serial Bus (USB)
of paper SPE 167877, “Reservoir Simulations in a High-Performance Cloud-Computing dongle to a virtual server. This was re-
Environment,” by Morgan Edward Eldred, Asma Aboubakr, Ahmed Abubakr solved by the use of a USB network de-
Al-Emadi, Thomas James O’Reilly, Nedal Barghouti, and Abdollah Orangi, vice server placed within the demilita-
Maersk Oil, prepared for the 2014 SPE Intelligent Energy Conference and Exhibition, rized zone (DMZ) behind the firewall.
Utrecht, The Netherlands, 1–3 April. The paper has not been peer reviewed. This enabled the mapping of the USB

For a limited time, the complete paper is free to SPE members at www.spe.org/jpt.

JPT • JULY 2016 57

 10.00
9.00
8.00
Hourly Cost (USD)
7.00
6.00
5.00
4.00
3.00
2.00
1.00
– country or region is outside of the
5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95 100
Utilization (%)
Internal
Fig. 2—Illustrative cost model for comparing HPCC and internal infrastructure.
port to a virtual server over the net-
work. The USB port on the device serv-
er was mapped to a server licensed to
use the simulation software in the DMZ
and configured with a public Internet
protocol address. It was also config-
ured in the firewall to allow traffic be-
tween the cloud server and the licensed
server in the DMZ. One limitation that
was encountered was that the licensed
server must be on the same subnet as
the USB device server, so it was not
possible to place the licensed server
in the cloud.
Cost Model
Fig. 2 shows an illustrative cost model
that calculates the break-even point
of using HPCC vs. an internal infra-
structure. As seen in the figure, it is fa-
vorable to use the HPCC when its use
over a long period of time is low. In
the case that this is kept high, using
infrastructure might be more benefi-
cial economically.
Further Discussion
Having provided the findings in the re-
sults as an operationally viable solu-
tion for an alternative to on-premise
computing, further development into
a user interface for end-user self-
service is needed. This would reduce
setup time and ease the workload on
the information-technology (IT) staff
and eventually minimize cost, pushing
commodity IT services further down the
supply chain.
58
Break-Even Point
Cloud
Furthermore, the initial setup time for
the HPCC would be considerably less,
approximately 1 work week, compared
with on-premise purchase procedure,
hardware installation, software installa-
tion, and end-user access and training.
Depending on the level of computing
power required, an analysis would be
needed to ensure that HPCC would be
able to service the various simulations,
with the variables being horizontal or
vertical software scalability and data ca-
pacity and transfer speed. Additionally,
a user interface for HPCC provisioning
would need to cater to the needs of the
end user as well as align with the simu-
lation software specificities.
Developing a repository of HPCC-
optimized simulation scenarios, with an
optimal user interface for end-user self-
service, would be the ultimate goal, re-
moving the need for on-premise com-
puting. If policies do not allow for this, a
hybrid modal approach would work, but
it would need to be integrated into the
same end-user provision portal.
Framework
The proposed framework is as follows:
◗ Determine business opportunity:
Determine if a business
opportunity exists to leverage
an HPCC environment, such
as moving from a scenario-
based modeling approach to a
probabilistic approach.
◗ Determine architectural feasibility:
Determine what effect the
opportunity has on the current
architecture and landscape and if
the opportunity is feasible. This
would also include what license
restrictions are put forward by
the vendors.
◗ Determine legal and regulatory
feasibility: Determine the security
requirements for the data that
will be used and set up the cloud
according to the region. If data
requirements specify that a specific
provider’s offering, then this is a
no-go.
◗ Determine economic feasibility:
Determine the break-even point
for using a high-performance cloud
vs. the deployment of internal
infrastructure.
◗ Plan: Determine and plan how
many jobs and scenarios need
to be run and then calculate this
against the break-even point.
◗ Execute: Implement the HPCC
technology model
◗ Realize: Run computing jobs on
the infrastructure.
◗ Evaluate: Evaluate performance
and document lessons learned.
Use new knowledge to assess new
opportunities.
By iteratively identifying, implement-
ing, and evaluating business opportu-
nities to leverage HPCC, the organiza-
tion will continually grow a portfolio of
HPCC initiatives. The Evaluate step is
especially important because it will help
the organization learn how to excel in
the HPCC discipline.
Conclusion
HPCC environments provide an oppor-
tunity to leverage technology enhance-
ments. While it is technically possible to
run reservoir simulations in the cloud,
there are still challenges with the licens-
ing models of existing software.
The framework provided is an agile
method for determining if the business
opportunity is ready for cloud comput-
ing and if it offers a significant opportu-
nity for pushing high-performance com-
puting further down the supply chain.
Cloud computing is very agile,
with recent technology being easier
to use and having low capital invest-
ment costs. JPT
JPT • JULY 2016
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 Modeling of a Complex Reservoir Where
the Normal Modeling Rules Do Not Apply

W ith the easy conventional oil

in Argentina having been
produced, one remaining way to find
new oil in existing fields is to convert
fields from primary or secondary
production to secondary or tertiary
production, respectively. For the
Cerro Fortunoso field, the high costs
required to develop the field, combined
with an ambiguous log response that
suggested that sand was predominantly
disconnected, resulted in secondary Fig. 1—(a) The location of the Cerro Fortunoso field in Argentina, with
production not being implemented. productive and nonproductive basins. (b) Satellite image of its location.
To reduce the risk, a waterflood
pilot was necessary to demonstrate and then to determine if waterflooding ◗ Preserving the zone thickness
that waterflooding has potential would, in fact, be economically viable. within correlated cycles
and to provide water-injection and ◗ Modeling of complex thrust faults
production data to constrain the history- Structural-Model Construction and stratigraphic repetitions
matching process. Usually, the first step in the construc-
tion of a structural model is to extract a The Simulation Model
Introduction surface from a seismic marker. Unfortu- Cerro Fortunoso posed a unique chal-
Fig. 1 shows the location of Cerro Fortu- nately, in Cerro Fortunoso, the presence lenge for simulation because of the large
noso in Mendoza province, approximate- of a significant thickness of igneous rock number of cells needed in the vertical
ly 1200  km southeast of Buenos Aires. and high-angle flanks causes high noise dimension to model the 1- to 2-m-thick
Most large fields in Mendoza province and attenuation, respectively, on exist- sands that make up the productive inter-
were exploited by waterflood decades ing 2D-seismic data and makes complet- vals of the field. All 17 correlated zones
ago. For waterflooding not to be initiated, ing a 3D survey a fruitless exercise. With- were shown to contain potentially pro-
the nature of the reservoir had to be un- out 3D seismic, the structural model was ductive thin sand intervals, so it was not
clear or the capital expenditure required constructed on the basis of data from possible to increase the cell thickness in
had to be high. In the case of Cerro For- both surface outcrops and subsurface any of the productive zones. In addition,
tunoso, a substantial investment is re- well data. This was a challenge because to history match the waterflood pilot,
quired to cover the cost of drilling infill Cerro Fortunoso is in a complex struc- it was necessary to ensure there were
wells and for the construction of a pipe- tural environment and the fold geometry at least two cells between each injector/
line to provide injection water from a was shown to vary significantly along the producer pair. Because the well spacing
river 15 km away. strike of the field. in the field is 150  m in some cases, this
To minimize the risk associated with The complex structural model was meant that the horizontal dimension of
converting the field to waterflooding, captured successfully in the static the cells was restricted to an average of
an integrated study was sanctioned that model. Specific challenges successfully 30 m. A full-field static model, therefore,
aimed to characterize the field initially met included: would be either very slow or impossible
to simulate. Consequently, it was neces-
sary to consider simulating sectors of the
This article, written by Special Publications Editor Adam Wilson, contains highlights
field only. Structural interpretation and a
of paper SPE 169369, “Integrated Modeling of a Highly Structural and Complex
variation in deepest oil suggest that Cerro
Reservoir Where the Normal Modeling Rules Do Not Apply—Cerro Fortunoso,” by Fortunoso is separated into individual
Anthony Thompson, SPE, Abel Garriz, Gaston Manestar, SPE, Griselda Vocaturo, blocks that could be simulated separate-
Vanesa Consoli, and Pablo Giampaoli, YPF, prepared for the 2014 SPE Latin ly. It was decided initially to simulate
American and Caribbean Petroleum Engineering Conference, Maracaibo, Venezuela, only the northeast block, which included
21–23 May. The paper has not been peer reviewed. the waterflood pilot.

For a limited time, the complete paper is free to SPE members at www.spe.org/jpt.

60 JPT • JULY 2016

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 Fig. 2—Simulation of water saturations in the northeast bock in 2038 with the existing waterflood (left) and an
expanded waterflood (right).
Gas Cap. The reservoir has a 95% car-
bon dioxide gas cap from volcanic activ-
ity. However, it was decided to model the
gas cap as a conventional hydrocarbon
gas cap.
Simulation Time Optimization. To im-
prove the running speed of the model,
it was necessary to run the model con-
strained by reservoir volume rate initial-
ly. If run on the more typical liquid rate,
wells unable to make their liquid-rate
constraint reduced their flowing bottom-
hole pressure to the minimum allowable
pressure of 1 bar. If these wells were lo-
cated near the gas cap, this resulted in
the subsequent production of large quan-
tities of gas and, hence, simulation in-
stability. By limiting the amount of gas
produced by use of the reservoir-fluid
history-matching constraint, the vol-
ume of gas produced in the simulation
is restricted.
Relative Permeability. A number of ex-
perimental relative permeability curves
were available. Some of these were re-
garded as being of doubtful quality, with
endpoints inconsistent with the expect-
ed range for this type of oil viscosity and
reservoir permeability. Directly using
relative permeability based on experi-
mental data, even the relative permea-
bilities that are regarded as being more
reliable, resulted in high levels of simu-
lated water production early in field life
while, in fact, water production in the
field was initially negligible. Applying
the J-function saturation, with its initial
water saturations that were lower than
the resistivity indicated, still resulted in
an excessive simulated water production.
To solve this, the critical water saturation
was increased so that water does not flow
62
at the water saturations modeled initially
by the averaged J-function in the dry oil
sands. ( J-function refers to the classical
expression relating water saturation and
capillary pressure.)
Saturation Modeling. The productive
features on Cerro Fortunoso are thin
sands dispersed stratigraphically be-
tween massive dense beds. The effect of
this was that, even in the center of a res-
ervoir bed, well logs would be reporting
partly the log response from either the
overlying or the underlying dense for-
mations. For both porosity and resistiv-
ity, this meant that, if the log response
was interpreted directly, the properties
would be underestimated. For porosity,
this would affect the material balance.
However, the greatest effect on the histo-
ry match came from the saturation mod-
eling. When log-derived saturations were
used in the model, a high level of water
production was predicted even though
production history had shown negligible
water production away from the aquifer.
This was interpreted as being caused by
the saturations in the productive sands
being estimated as lying in the transition
zone of the relative permeability curve,
resulting in simultaneous production of
oil and water. In reality, the saturation
in the reservoir rock was at initial water
saturation, which obviously results in the
production of dry oil.
J-function values were calculated for
the controlled-relative-permeability
water-saturation points and were en-
tered into the simulation oil/water rela-
tive permeability table. The surface ten-
sion for Cerro Fortunoso between the
oil and water systems is 25  dynes/cm.
With these data and the permeability
and porosity data obtained from the
static model, the saturation in the field
was populated.
Pressure Data. Because most of the field
has been developed exclusively by prima-
ry depletion, there were limited water-
breakthrough data to history match, and
these were available only after the ini-
tiation of the waterflood pilot. However,
there were significant repeat-formation-
tester (RFT) data available. Because the
field is in an area where the surface is sig-
nificantly above sea level, the RFT data
were critical in determining the equili-
bration conditions.
The first wells in each block showed
equilibrium and constant gradients.
Subsequent wells, as could be expected,
showed varying levels of pressure deple-
tion. This demonstrated that there was
pressure communication between wells.
In addition, pressure data demonstrated
depletion of varying levels from all indi-
vidual reservoir zones. This meant that
no zones could be discarded for history
matching, thus slowing run times.
Results
As a result of the integrated modeling
project, a development plan for expand-
ing the existing waterflood has been pro-
posed for the whole field. However, to
date, forecasts have been limited to the
northeast sector. Fig. 2 shows the simu-
lated water saturation in the MK-150 zone
in 2038. The left-hand side shows water
saturation after the continuation of the
existing pilot waterflood, and the right-
hand side shows water saturation after an
expansion of waterflooding to cover the
entire block. The reduction in oil satura-
tion with the expansion of the waterflood
is especially apparent in the southern re-
gion of the northeast block. JPT
JPT • JULY 2016
Use of Emulator Methodology
for Uncertainty-Reduction Quantification

M ost simulation models go

through a series of iterations
before being judged as giving an
adequate representation of the physical
system. This can be difficult because
the input space to be searched may
be high dimensional, the collection
of outputs to be matched may be
very large, and each single evaluation
may take a long time. Because the
uncertainty analysis is complex
and time consuming, in this paper,
a stochastic representation of the
computer model, called an emulator,
was constructed to quantify the
reduction in the parameter input space.

Introduction
Reservoir simulators are important
and widely used in reservoir manage-
ment. They are used in reservoir-
performance prediction and for de-
cision making. These simulators are Fig. 1—Process to perform uncertainty-reduction quantification.
computer implementations of high-
dimensional mathematical models for the history matching: deterministic and the collection of outputs to be matched
reservoirs, where the model inputs are probabilistic approaches. may be very large, and each single evalu-
physical parameters and the outputs are The deterministic approach involves ation may take a long time.
observable characteristics such as well- running the initial simulation model with To deal with the large number of itera-
pressure measurements and fluid pro- different input values to obtain one sim- tions and high computational resources
duction. Uncertainties are always present ulation model between many probable commonly encountered in the probabi-
in the reservoir-characterization pro- matches to the field data. listic approach, proxy models are used.
cess; thus, input parameters are usually In a probabilistic approach, in which Because history matching and
uncertain and so is the simulator output. several reservoir-model scenarios are uncertainty-reduction quantification
The procedure to calibrate the considered, the uncertainty analysis pro- are complex and time consuming, this
reservoir-simulation model is called his- cedure is used. Identifying the input pa- work shows the work flow used to quan-
tory matching. On the basis of observed rameters for which the simulation out- tify the reduction in the parameter input
data, a set of possible input choices for puts match the observed data can be a space from production data over differ-
the reservoir model is identified. Two dif- difficult task because the input space to ent production periods. This work flow
ferent procedures can be used to perform be searched may be high dimensional, comprises the construction of a proxy
model called an emulator. This tech-
nique was applied to a synthetic reser-
This article, written by Special Publications Editor Adam Wilson, contains highlights
voir simulation model that was built to
of paper SPE 169405, “Use of Emulator Methodology for Uncertainty-Reduction represent the region of an injector and
Quantification,” by C. Ferreira, Universidade Estadual de Campinas; I. Vernon, related producers.
Durham University; D.J. Schiozer, SPE, Universidade Estadual de Campinas; and
M. Goldstein, Durham University, prepared for the 2014 SPE Latin American and Proposed Methodology
Caribbean Petroleum Engineering Conference, Maracaibo, Venezuela, 21–23 May. The work flow used to construct the
The paper has not been peer reviewed. emulator was designed to quantify the

For a limited time, the complete paper is free to SPE members at www.spe.org/jpt.

JPT • JULY 2016 63

 reservoir-simulation-model uncertainty
reduction from production data. The ob-
jective was to identify the inputs of a
reservoir-simulation model within a pos-
sible input-parameter space, whose out-
puts match the hypothetical historical
production data. Fig.  1 shows the work
flow. Each stage is described as follows.
Input- and Output-Parameter Defini-
tion. In reservoir simulation, uncertain
inputs are physical parameters deter-
mined through an uncertainty analysis
performed on the base model. The out-
puts of the model, for a given choice
of inputs, are observable characteristics
such as well bottomhole pressure, water
rate at production wells, and water-
saturation maps. The input-variable se-
lection depends on the underlying prob-
lem and the knowledge of the engineer.
The physical state of the reservoir un-
certainty varies because of the amount of
information available and the production
period. In this study, the analysis is being
performed in the field-development
phase and the uncertainty of the appro-
priate choices of the input parameters for
the reservoir model is high.
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64
Input-Data-Set Sampling. The input-
data-set sampling is an important stage
in creating an adequate emulator. Dif-
ferent sampling methods exist and have
been applied in reservoir simulations.
The Latin hypercube design (LHD) is an
efficient design and was selected as a
sampling method for this work. Scenar-
ios were generated on the basis of the
input-parameter space and sampled with
the LHD. The selected scenarios were
simulated with commercial simulation
software to obtain the production out-
puts. The sampled input parameters and
resulting simulation outputs were used to
construct the emulator.
Emulator Estimation. The emulator is
an approximation of the existing numer-
ical reservoir model. It should be able
to replicate the response of the simula-
tion model. For a reservoir-simulation
model, it is infeasible to evaluate the
simulator at enough choices to search
the input space exhaustively. Therefore,
a representation of the output uncer-
tainty at each input choice must be con-
structed. This representation is termed
an emulator.
Emulator Diagnostics. Emulator diag-
nostics is the process of assessing an em-
ulator’s prediction accuracy and quality.
The response values predicted by the em-
ulator must comprise the results of the
full numerical simulation for the input
data set.
Implausibility Analysis. The implausi-
bility analysis is performed to obtain the
input parameters whose outputs match
the hypothetical historical data. The hy-
pothetical historical data are derived
from a hypothetical reality selected from
all possible scenarios generated in the
uncertainty analysis. Moreover, these in-
puts are obtained to improve the emula-
tor reliability and to evaluate the uncer-
tainty reduction at the end of the process.
The maximum-acceptable-implausi-
bility-value cutoff determines whether
an input-parameter vector is viewed as
nonimplausible or not. This value can be
defined on the basis of various consider-
ations, but, often, the cutoff used is equal
to the critical value of some appropriate
distribution (for example, the standard
normal distribution).
Nonimplausible-Inputs Evaluation. The
nonimplausible input parameters ob-
tained at the end of the process represent
the input parameters of the reservoir sim-
ulation whose outputs match the hypo-
thetical historical production data. These
parameters are evaluated to identify how
much the production data improved the
reservoir-model understanding.
While carrying out this analysis con-
sidering different production periods,
it is possible to evaluate the effect of
the production period on the reservoir-
uncertainty reduction.
Conclusions
A work flow to determine the input pa-
rameters whose output values match his-
torical data using emulation techniques
was presented. The work flow was ap-
plied successfully to a five-spot synthetic
case that was built to represent the re-
gion of an injector and related produc-
ers. The uncertainty reduction of a res-
ervoir model because of new information
acquisition for different production pe-
riods was quantified. The field produc-
tion data used were obtained by consid-
ering a hypothetical reality among all
possible scenarios because the analysis
was performed at the development stage
and used a synthetic model. Two pe-
riods of production were evaluated: at
an early production stage (1,000 days)
and at an intermediate production stage
(3,500 days).
The results obtained showed the
importance of using emulators in
uncertainty-reduction quantification and
history matching. The number of input
parameters considered nonimplausible
was a small set of the initial input space.
At an early stage, it was possible to re-
duce the uncertainty by identifying the
hypothetical real field permeability and
identifying possible values for channel
positioning. However, other important
physical features were not identified,
such as the channel permeability, width,
and length. At an intermediate stage, the
uncertainty reduction was higher. How-
ever, some important physical features
that affect production prediction, such
as channel permeability and width, still
were not identified; therefore, further re-
search will test the application of the em-
ulation technique with 4D-seismic data
to reduce uncertainty. JPT
JPT • JULY 2016
Simulation Analysis With Association-Rule
Mining Plus High-Dimensional Visualization
C
omputational advances in reservoir
simulation have made possible the
simulation of thousands of reservoir
cases in a practical time frame. This
opens a new avenue to reservoir-
simulation studies, enabling exhaustive
exploration of subsurface uncertainty
and development/depletion options.
However, analyzing the results of a large
number of simulation cases remains
challenging. This paper presents a
new method that enables the efficient
analysis of massive reservoir-simulation
results by discovering interesting
patterns of relationships among
variables in large data sets. The method
uses association-rule mining together
with high-dimensional visualization.
Introduction
Ensemble-based approaches for reservoir
modeling and simulation have been inves-
tigated for decades. The majority of the
methods are designed to explore a high-
dimensional space spanned by uncertain-
ty parameters and find a set of reservoir
models that reproduce historical produc-
tion performance. Once an ensemble of
history-matched models is obtained, the
effect of subsurface uncertainty on pro-
duction forecast is evaluated quantita-
tively by simulating flow performance on
individual members of the model ensem-
ble. Exploration of the parameter space
during the model calibration is conducted
with various stochastic algorithms. Major
research efforts on these approaches are
devoted to achieving efficient sampling
from the parameter space and obtain-
This article, written by Special Publications Editor Adam Wilson, contains highlights
of paper SPE 174774, “Using Association Rule Mining and High-Dimensional
Visualization To Explore the Impact of Geological Features on Dynamic Flow Behavior,”
by Satomi Suzuki, SPE, and Dave Stern, SPE, ExxonMobil Upstream Research
Company, and Tom Manzocchi, SPE, University College Dublin, prepared for the 2015
SPE Annual Technical Conference and Exhibition, Houston, 28–30 September. The
paper has not been peer reviewed.
For a limited time, the complete paper is free to SPE members at www.spe.org/jpt.
JPT • JULY 2016
ing predictive capability to capture the
range of uncertainty related to geologi-
cal uncertainty remaining after data as-
similation. However, little attention has
been paid to qualitative analysis of the ef-
fect of geological features on simulated
production performance.
One obvious reason for the under-
utilization of the model ensemble for
understanding reservoir sensitivity is
the lack of efficient methods to visual-
ize simulation results in such a way that
interaction among multiple uncertain-
ty parameters and simulated production
response can be revealed rapidly. This
paper presents a novel methodology that
serves this purpose by coupling a well-
known data-mining algorithm, called
association-rule mining, with an existing
high-dimensional visualization method
called dimensional stacking.
Data Set
The Sensitivity Analysis of the Impact
of Geological Uncertainty on Produc-
tion (SAIGUP) project was an interdisci-
plinary reservoir-modeling project con-
ducted from 2000 to 2004. The project
aimed at studying the influence of geol-
ogy on oil recovery from progradational
shallow-marine reservoirs, which repre-
sent North Sea assets, by investigating
peripheral-water-injection performances
simulated on synthetic reservoir cases.
The synthetic reservoir models built and
simulated during the course of project
add up to more than 35,000.
This study used a suite of 9,072 syn-
thetic reservoir models created by brute-
Shoreface
Downdip
RF
Progradation Direction
0.54
0.50
Updip
Fault K 0.46
LMH L
Cross dip
coverage
Barrier
M
Fault density
0.42
H M L H
Low Mid High
Aggradation Angle
Fig. 1—Dimensional-stacking image
from 243 reservoir cases from the
SAIGUP data set. L=low, M=mid, and
H=high.
force sampling (exhaustive sampling from
everywhere in high-dimensional space)
from eight-dimensional parameter space,
focusing on structural and sedimentolog-
ical uncertainty anticipated in a shallow-
marine depositional environment.
Association-Rule-Based
Dimensional Stacking
To illustrate association-rule-based di-
mensional stacking, simulation results
from a small subset of the SAIGUP data
set were used. This small subset, consist-
ing of 243 models, corresponds to brute-
force sampling from five-dimensional
uncertainty parameter space.
Dimensional Stacking. Dimensional
stacking is a high-dimensional visual-
ization technique. Fig. 1 illustrates an
example of dimensional stacking that
visualizes recovery factor (RF) of oil sim-
ulated from 243 reservoir cases sam-
pled from five-dimensional parameter
space. Each of the pixels in the figure
represents a single simulation. The pixel
color indicates the value of the RF. The
pixels are arranged in a single 2D view
using a nested loop structure in such a
way that the pixels cycle at the slowest
over the outermost axis parameters; in
each window, cycle faster over the inner
65
 Shoreface
Low
Barrier Coverage
Mid
Agg. angle
LMH D direction
Prog.
High
U
Fault density
H M L X
Low Mid
Fault Permeability
Fig. 2—Dimensional stacking image
from 243 reservoir cases from the
SAIGUP data set generated using
parameter ordering different from that
of Fig. 1. L=low, M=mid, and H=high.
axis parameters; and, further in each of
the subwindows, cycle fastest over the
innermost axis parameter. If the data
are sampled from higher-dimensional
space, the nested loop continues.
Dimensional stacking is a power-
ful tool to visualize how production re-
sponse varies in the high-dimensional
parameter space. However, the difficulty
lies in how to determine the order of axis
parameters to arrange the nested loop.
Fig.  2 depicts a dimensional-stacking
image created from exactly the same
data as in Fig. 1 using a different order
of axis parameters. As shown, the sen-
sitivity pattern is not visible at all if the
“wrong” ordering of parameters is used.
Finding the “right” ordering of axis pa-
rameters on a trial-and-error basis usu-
ally is prohibitive because the number of
possible arrangements of axes increases
dramatically as dimensionality of param-
eter space increases.
This paper presents a novel approach
to order the axis parameters automati-
cally by directly using knowledge about
the parameter/response relationship and
parameter interaction. To obtain such
knowledge automatically, a well-known
data-mining method, association-rule
mining, was used.
Association-Rule Mining. Association-
rule mining was originally proposed for
solving “market basket” problems to
analyze the purchase behavior of cus-
tomers by mining transaction records
collected at points of sale. It aims at dis-
covering hidden patterns in big data by
finding rules that occur frequently in the
given set of transactions.
66
The Apriori algorithm first finds the
RF combinations of items that occur fre-
quently in the data set and then generates
0.54
the rules from the discovered frequent
0.50 item sets through binary partitioning of
the item set. Confidence of a rule is the
0.46 conditional probability of occurrence of
the right-hand side of the rule given the
0.42 occurrence of left-hand side of the same
rule. The support count is the number of
High transactions that support a given rule.
The lift is the ratio of confidence to prob-
ability of occurrence of the right-hand
side of the rule. In other words, the lift in-
dicates the extent to which the left-hand
side of the rule elevates the probability of
occurrence of the right-hand side of the
rule from its marginal probability.
Rules are efficiently mined by specify-
ing thresholds for minimum confidence
and minimum support. Typically, high
numbers of rules are obtained and more
than 99% of them are redundant or not
interesting. The rules that are not statis-
tically significant can be eliminated by
specifying a threshold for minimum lift.
The redundant rules can be removed by
eliminating the rules that are a superset
of other rules and show equal or lower lift
compared to their subset rules.
Using Association-Rule Mining
for Dimensional Stacking
Although association-rule mining was
originally proposed for solving market
basket problems, it can be used to dis-
cover interesting relationships between
variables of any large data set sampled
from high-dimensional parameter space.
By inspecting the discovered rules, engi-
neers can rapidly extract knowledge from
the large data set and use it to assist in
in-depth analysis to achieve an optimum
combination of development options.
The method presented in this paper
proposes using the set of discovered rules
to determine the ordering of axis param-
eters for dimensional stacking to obtain
the best visualization result.
The step-by-step procedure to im-
plement dimensional stacking using
association-rule mining is as follows:
◗ Convert continuous variables, if
any, to categorical variables. The
recommended conversion is to
discretize data into multiple levels
(e.g. low, medium, and high) in such
a way that frequency of occurrence
of data in each level becomes equal,
in order to avoid statistical bias.
◗ Mine rules from discretized data
set using the Apriori algorithm by
limiting left-hand-side items of
the rules to axis parameters and
right-hand-side items of the rules to
production responses.
◗ In the example presented in the
complete paper, the authors
create dimensional-stacking
images separately for multiple
environments of deposition (EODs)
(e.g., shoreface, wave-dominated
delta, fluvial-dominated delta)
because the interpretation becomes
more intuitive in such a manner. In
order to do so, rules obtained from
the second step were subdivided into
separate EOD groups in accordance
with the levels of curvature that
appear in the left-hand side of
the rules.
◗ Conduct the following steps for each
EOD:
o Eliminate insignificant or
redundant rules from the rule set.
o Score individual axis
parameters on the basis of
the remaining rules. Using
the score, automatically rank
axis parameters in accordance
with their power to segregate
production response in high-
dimensional parameter space.
Some parameters contribute to
the segregation of production
response by their own effects,
while some parameters contribute
to the segregation by enhancing
the effect of other parameters
through parameter interaction.
The ranking is designed to
account for both contributions.
o Arrange the coordinate of the
dimensional-stacking image on
the basis of the result of ranking
in such a way that, the higher
the rank of the parameter, the
outer-more the axis to which the
parameter is assigned. Generate
the dimensional-stacking image.
The whole process can be executed
automatically on the full SAIGUP data
set (9,072 models) in less than 10 sec-
onds without user intervention, thanks
to the computational efficiency of the
Apriori algorithm. JPT
JPT • JULY 2016
TECHNOLOGY FOCUS
Artificial Lift
Mike Berry, SPE, Independent Artificial-Lift Consultant
It has been a year since my last lecture/ not know with certainty what the res-
rant about corporate shortsightedness. ervoir properties are outside of near-
I am sure my concerns were taken to wellbore regions. We use algorithms to
heart and everyone was able to spend come up with grid properties, but we are
the last year working on training, docu- really just making educated guesses.
menting best practices, tracking failure What are we to do? The most com-
root causes and costs, and optimizing mon approach is to plug in our best-
lift efficiency. This allows me to focus guess data  and use the results as truth.
on a problem unique to the extraction New engineers feel a sense of accom-
industries. This problem arises because plishment for a job well done. More-
we work at the transition from unbound, experienced engineers hope for the best.
heterogeneous nature to bound, homo- Old codgers like me hope nothing catch-
geneous controlled environments. es on fire.
Our problem is that we are deal- We see the results of this uncer-
ing with multiphase, multicomponent tainty all around us. Wells do not pro-
fluids whose compositions change spa- duce as expected, equipment runs are
tially and temporally inside imperfect- inconsistent, reserves estimates are
ly understood heterogeneous reservoirs constantly revised.
whose characteristics also change spa- A better approach is to recognize that
tially and temporally. When a black-oil we are working in a world of uncertainty.
correlation comes with the caveat that At a minimum, create a worst case, a best
the results are ±20%, they are not kid- case, and a most-likely case. Many do
ding. And when they specify a range of this, but they do not always appreciate
validity that we blithely exceed, all bets that the only thing for certain is that the
are off. When we take Darcy’s law for most-likely case will not happen. With
linear flow of water through a homo- any luck at all, the results will fall some-
geneous sandpack and manipulate it to where between the worst and best cases.
apply to multiphase flow through a het- A bigger problem is the temptation to
erogeneous multilayer reservoir, we have seize upon the best case because it is the
to make assumptions. Sure, we can break only one that will meet the fiscal require-
the reservoir into a grid and assign val- ments for the project. It is easy for me to
ues to each grid, but the truth is we do tell you to just say no, but people have
Mike Berry, SPE, is an independent artificial-lift consultant. Now
approaching 40 years in the petroleum industry, he has worked
as a roustabout standing knee deep in crude and as a research
scientist testing state-of-the-art equipment in what was one of
the world’s premier multiphase-flow test loops. Berry has served
on numerous SPE committees and occasionally serves as a
PetroSkills instructor. He holds a BS degree in petroleum engi-
neering from the University of Oklahoma and is a licensed pro-
fessional engineer. Berry serves on the JPT Editorial Committee and can be reached
at michaelrberry@sbcglobal.net.
JPT • JULY 2016
emotional buy-in to their projects and
often feel that their career depends upon
the project going forward.
What we should do is use error analy-
sis and statistical methods to define
uncertainty. The propagation of uncer-
tainty through mathematical equations
can be calculated. It was required in
my physical-chemistry lab almost 40
years ago. We can calculate statistically
expected results. It is nothing new and
is well-understood. We just do not apply
it to our own uncertainty. As engineers,
we should demand or create software
that allows input data to be defined as
either a value and uncertainty or a range
and distribution. Results should be given
either a measure of the uncertainty or
a distribution.
I selected these papers because the
authors have recognized, embraced,
and accepted uncertainty. The papers
describe how they addressed uncertainty
to find a solution for their problems. JPT
Recommended additional reading
at OnePetro: www.onepetro.org.
OTC 24799 A New Model for the Accurate
Prediction of Critical Liquid Removal
Based on Energy Balance by Xiao-Hua Tan,
Southwest Petroleum University, et al.
SPE 175310 Improving the Electrical
Submersible Pump’s Operational Time
by 50% Using the Six-Sigma Procedures
by M. Ahmad, Kuwait Institute for Scientific
Research, et al.
SPE 176194 The Success Story of
the Light-North Area of Roger Block:
Continuous Exertion To Increase Electrical-
Submersible-Pump Performance Through
Rectifying Design Process To Resolve
MDSS Problem by Cintani Kusuma Dewi,
Chevron Pacific Indonesia, et al.
67
 Evaluation of Intermittent-Flow Behavior
Upstream of Electrical Submersible Pumps

T his work experimentally

investigates the behavior of an
intermittent multiphase liquid/gas
Metering holes

flow that takes place upstream of an ID (mm) Quantity

electrical submersible pump (ESP). On
36
the basis of the results and associated 1.0
interpretation, a flow-homogenizer 72
device was designed, built, and tested.
Classical ESPs, which, in essence, 1 9
2.0
are composed of a series of radial/ 18
centrifugal impeller/diffuser pairs, are
not tailored to work in scenarios with
high gas-void-fraction (GVF) values. The
apparatus was assembled to avoid the
development of intermittent flow.

Introduction
In the oil industry, multiphase flow oc-
curs during the production and trans-
port of oil and gas at wells and in the
lines that connect wells to platforms. Fig. 1—Experimental apparatus and dimensions of the filter to work with water
During well production, the flow from and air. ID=internal diameter.
the reservoir to the production plat-
form undergoes depressurization. Con- flow. In this flow pattern, the liquid in The use of an ESP pump mounted on
sequently, a portion of the liquid hydro- the pipe is nonuniformly distributed axi- a skid is an artificial-lift concept for the
carbon dissociates and becomes gaseous ally. Plugs or slugs of liquid that fill the application of submerged centrifugal
during production. pipe are separated by gas zones, which pumping technology through the devel-
Multiphase flows are characterized by contain a stratified liquid layer flowing opment of a subsea pumping system in-
the existence of several flow patterns. along the bottom of the pipe. The liquid stalled on the seabed. The advantages
When gas and liquid flow in a pipe at the in the slug may be aerated by small bub- of this system include the reduced costs
same time, several flow configurations bles, which are concentrated toward the of pump-installation and -retrieval op-
may exist. These patterns depend on op- front of the slug and the top of the pipe. erations because the pump module can
erating variables—namely, the velocity The intermittent pattern is usually sub- be installed by a light-intervention ves-
of the liquid and gas, fluid properties, divided into slug and elongated-bubble sel instead of a drilling rig. Also, cost
and some geometrical aspects such as patterns. In principle, the flow behav- is reduced by the continuity of produc-
pipe diameter and angle. Hydrodynamic iors of slug and elongated-bubble flow tion through a bypass line during main-
aspects of the flow change dramatically appear to be the same, with regard to the tenance. This application scenario is di-
as each flow pattern prevails. flow mechanism; therefore, there is no rected for horizontal and near-horizontal
Despite the large number of flow pat- particular advantage in distinguishing flow (5°).
terns, this work focuses on intermittent between them. This system can be useful in instances
of low gas/liquid ratios, situations that
require single-phase pumping systems
This article, written by Special Publications Editor Adam Wilson, contains highlights
outside of the producing well, or sys-
of paper SPE 173958, “Experimental Evaluation of Behavior of Intermittent Flow in tems that are coupled with a gas/liquid-
Scenario of Application of Electrical Submersible Pump,” by Roberto da Fonseca separation system.
Jr., Paulo Vinicius S.R. Domingos, and Diogo Cunha dos Reis, Petrobras, prepared Because of their intrinsic transient
for the 2015 SPE Artificial Lift Conference—Latin America and Caribbean, Salvador, nature, slug flows can cause severe prob-
Brazil, 27–28 May. The paper has not been peer reviewed. lems in processing and transport equip-

For a limited time, the complete paper is free to SPE members at www.spe.org/jpt.

68 JPT • JULY 2016

ment because of the intermittent load-
ing that is imposed on structures. Also,
in hydrocarbon-production lines, even
in cases in which the average gas/liquid
ratio expected is approximately 20% be-
cause of the flow configuration, instan-
taneous results can raise this ratio to 60
or 80% and, consequently, shut down
the pump.
Once the risks involved in the use of
this concept for oil production were
mapped, the idea was to evaluate exper-
imentally the performance of a proto-
type built to redistribute the liquid and
gas phases in the flowline, remaining
as close as possible to homogeneous or
stratified flow patterns and, thus, elimi-
nating the risk of major fluctuations in
gas fraction.
Experimental Apparatus
Water and Air Experiments. Initially,
tests were carried out with water and air.
On the basis of field data, an experimen-
tal apparatus with tubing that had an in-
ternal diameter of 19 mm was assembled
to work with water and air.
The homogenizer concept adopted in
this project is illustrated in Fig. 1. This
equipment receives the multiphase flow
(marked as “1” in Fig. 1), and a pipe with
metering holes was installed inside it so
that the flow is forced to pass through
the interior, stimulating the mixture of
liquid and gas. Assuming a previously
calculated scale factor, the internal diam-
eter of the apparatus was 84.50 mm and
height was 188 mm. For performance-
evaluation purposes, the influence of
both the number and the diameter of
the holes was studied by measuring the
pressure drop of the homogenizer. For
that, a differential-pressure gauge was
installed between the input and output of
the equipment. A pressure gauge also was
installed on the homogenizer.
Gas and Oil Experiments. In the sec-
ond step, experiments were conducted
with oil and natural gas. The dimen-
sions of the testing system and equip-
ment were increased. A flowline with an
internal diameter of 3 in. was used; the
homogenizer has an inner diameter
of 200  mm and a height of 750  mm.
For testing purposes, four different
configurations of diameter and hole
JPT • JULY 2016
Liquid-level measurement
Inlet
Outlet
Liquid-level measurement
Fig. 2—Experimental apparatus to work with oil and gas.
count were considered. The prototype
is shown in Fig. 2. For these tests, a
differential-pressure gauge was in-
stalled and the liquid level inside the
equipment was measured.
Data-Acquisition System. To evaluate
the intermittent flow behavior, an elec-
tronic circuit was used to measure the
electrical impedance of the mixture of
gas and liquid. It is possible, by means
of the measured electrical impedance, to
detect the occurrence of gas and liquid
phases and their volume fractions, infer
the flow pattern, and even estimate the
volumetric flow of the phases.
Results
Water and Air Loop. Pressure-Drop
Measurement. For comparison, four
different settings for the filter installed
within the homogenizer were studied.
Tests were performed for 40 minutes for
each configuration, and the average and
standard deviation of the pressure drop
generated by the homogenizer were cal-
culated. It was observed that the values
were stable over time.
As expected, increasing the equivalent
area resulted in a reduction in pressure
drop in the system.
Influence on the Flow Pattern. The
study compared configurations in which
the sensor was positioned before the ho-
mogenizer inlet (Position 2) and down-
stream of the homogenizer (Position 3).
When the impedance sensor was
placed in Position 2, it was possible to
characterize the occurrence of intermit-
Metering holes
tent flow. For all the analyzed tests, by
placing the equipment in Position 3, it
was possible to observe a homogeniza-
tion of the flow.
In general, it can be said that the goal
of obtaining a homogeneous flow was
met with this proposed apparatus. The
next step was to conduct tests with oil
and natural gas.
Oil and Natural-Gas Loop. The next
step was to build a prototype and con-
duct tests using oil and natural gas. At
this stage, two flow-rate scenarios were
considered (400 and 500 m3/d), increas-
ing the GVF from 10 to 40%.
Tests conducted at field scale in the
presence of oil and natural gas showed
that the experimental apparatus provid-
ed more-homogeneous flow downstream
of the equipment when exposed to inter-
mittent flow at the entrance.
Conclusions
This study aims to show the efficacy
of a novel device for use upstream of
ESPs deployed on slightly inclined sea-
bed skids, under intermittent liquid/gas
multiphase flows in offshore petroleum
production. Instantaneous fluctuations
of gas fraction inherent to intermittent
flow were avoided by using the device,
consequently enlarging the operation-
al envelope of such ESP use. The data
already acquired in the experimental
phases will contribute to the next phase,
wherein the best combination of orifice
size, hole count, and distribution will
be sought. JPT
69
 Run-Life Improvement by Implementation
of Artificial-Lift-Systems Failure Classification

T his paper describes a methodology

for classification of artificial-lift-
system (ALS) failures and addition of
a commonly used root-cause failure
classification. This methodology was Colombia Venezuela
applied to different ALSs such as beam
pumps (BPs), progressing cavity pumps Barrancabermeja
(PCPs), electrical submersible pumps
(ESPs), and electrical submersible
progressing cavity pumps (ESPCPs).
The starting point was the definition of
the boundaries of each system. Then, La Cira–Infantas
each job in the well was defined as
(1) a failure, (2) a failure, non-ALS, or (3)
no failure, in order to look for ways to
improve run life. Fig. 1—La Cira-Infantas field location.

Introduction Failure Analysis Data Collection for RCFA. Data are

La Cira-Infantas oil field is in the Middle The root-cause failure-analysis (RCFA) collected for analysis, such as well me-
Magdalena Valley in Colombia (Fig. 1). process used in La Cira-Infantas has the chanical conditions and reports of
The vast majority of the wells are com- objective of finding the real cause of a equipment sizing, assembling, testing,
pleted with 7-in. production casing and given failure and identifying effective so- and installation.
perforated with 5 shots/ft with no sand- lutions to prevent a recurrence of the fail-
control completion in place, and then the ure. The steps for the RCFA are as follows. Equipment Dismantling and Inspec-
ALS is installed. tion. The ALS is dismantled in special-
Initial Diagnosis and Failure Confir- ized service shops. Before dismantling,
ALS in La Cira-Infantas mation. When an ALS ceases to lift the ex- each ALS section and all connections,
From the beginning of the activity in pected production, specific procedures shaft plays, and settings are evaluat-
La Cira-Infantas, almost 100 years ago, are performed to try to restart the sys- ed and measured. During the disman-
several ALSs have been used to produce tem. If production is not re-established, tling process, the condition of each part
fluids from the wells. Since 2005, the a downhole failure is confirmed. is evaluated.
field has offered different conditions, de-
pending on the mature state of the water- Pulling Equipment From the Well. Findings Discussion. On the basis of
flooding—high water percentage, high Mechanical and electrical tests are per- all the previous data, the failed parts
and low flow rates, free gas, and corro- formed to determine ALS condition. are selected and their condition is de-
sive fluids. Tubing is tested for leaks. As equipment termined precisely. The conditions and
Currently, ALSs such as BPs, PCPs, is pulled, each part of the ALS is inspect- actions that affected these failed parts
ESPs, and ESPCPs are used for producing ed carefully and qualitative measure- are evaluated.
the total fluid of the field. ments are taken.
Failure Analysis and Determination
of Root Cause. After a complete analy-
This article, written by Special Publications Editor Adam Wilson, contains highlights
sis of the sequence of events that led to
of paper SPE 173913, “Run-Life Improvement by Implementation of Artificial-Lift-
the failure and the failure mechanisms,
Systems Failure Classification and Root-Cause Failure Classification,” by Edward the most probable root cause is selected.
Rubiano, José Luis Martin, Jesus Prada, Manuel Monroy, Laura Labrador,
Jonathan Celis, and Jahir Gutierrez, Oxy, and Michel Bohorquez, Ecopetrol, Identification of Effective Actions To
prepared for the 2015 SPE Artificial Lift Conference—Latin America and Caribbean, Prevent the Failure. Effective actions
Salvador, Brazil, 27–28 May. The paper has not been peer reviewed. and solutions are identified that will pre-

For a limited time, the complete paper is free to SPE members at www.spe.org/jpt.

70 JPT • JULY 2016

vent recurrence of the failure, be within
the team’s control, and meet the goals
and objectives.
Follow-Up of Action Plans for Contin-
uous Improvement. The recommenda-
tions for improving ALS performance
are implemented and followed up.
Information Management and Sta-
tistics. The ALS team continuously
evaluates the performance of the in-
stalled ALSs and maintains a data-
base of the field life and monthly year-
to-date statistics of key performance
indicators (KPIs).
Failure Classification
The objective of this process is to estab-
lish a common terminology for ALS fail-
ure classification divided into three dif-
ferent categories—ALS failure; failure,
non-ALS; and no failure.
In order to start this process, it is im-
portant to have a clear definition of the
boundaries of the ALS.
The ALS boundary typically is estab-
lished by the downhole pump (including
accessories), components used for power
transmission, and wellhead accessories,
with no inclusion of surface equipment.
The exclusion of surface equipment in
this classification is mainly because a
well intervention is not required for cor-
rective maintenance.
Definition of ALS Failure and Fail-
ure, Non-ALS. A failure is the condition
where the ALS system does not meet its
objective to produce fluids to surface. It
is divided in two conditions.
ALS Failure. The system does not per-
form the required function because of
a mechanical or electrical failure of the
ALS components.
Failure, Non-ALS. The system does
not perform the required function be-
cause of one or more of the following:
◗ Failure of items not included in the
ALS boundaries
◗ High sand production
◗ Redesign (upsizing or downsizing)
of the ALS
◗ External plugging, occurring when
the ALS is plugged with scale,
paraffin, or asphaltenes
◗ Fish (e.g., completion equipment
has dropped into the hole)
JPT • JULY 2016
Definition of No Failure. The system is on failures, root-cause classification, and
removed from the well for reasons other implementation of action plans, improve-
than a failure, such as ment was seen with these critical wells.
◗ Pulling and abandonment
◗ High water cut Conclusions
◗ Low well production The implementation of this methodol-
◗ Workover ogy helps to organize and focus effort on
◗ Well suspension the critical failures in ALSs. Continuous
follow-up on the implementation of ac-
KPIs tion plans is also a key element of success.
In order to track performance improve- The proper definition of the failure
ments in the implementation of this root cause and its precise classification
methodology, KPIs are used, such as are essential for determining effective
◗ Failure index—The frequency with action plans to prevent recurrence of
which the ALS fails, expressed the failures.
as a fraction, calculated in 1-year It is not a good practice to track just
periods. one KPI; it is important to have different
◗ Pulling index—The frequency with KPIs because all of them show different
which the ALS is changed in a well results and their analysis is a good way to
intervention, expressed as a fraction understand ALS performance over time.
and calculated in 1-year periods. Artificial-lift failures are based on the
◗ Recurrence index—The frequency boundaries proposed under this method-
of each well failing. The idea is to ology; these boundaries can be custom-
have a recurrence index of unity— ized for each location.
that is, to have a maximum of one Failures, non-ALS, are based on whole-
failure per well in a calendar year. process failures such us data validation
◗ Average run time—The run time (e.g., oversized or undersized), improper
is the cumulative time of the ALS operation of facilities, or injection wells
currently running in the well. that generate higher drawdown in some
Downtime during installation is wells, and some sanded wells. JPT
discounted from the total value. The
average run time corresponds to
the average value of run time of all
ALSs in a specific field currently in
operation.
◗ Average run life—Uses the same
definition as run time; however, it
corresponds to all systems pulled
from the well. Average run life
corresponds to the average value of
run life of all ALSs in a specific field
currently pulled or failed.
Examples of Run-Life
Improvement
Controllable Failures. Once imple-
mented in 2012, this methodology was
used to select some of the critical or
most-common root causes of failure,
which were called controllable failures.
With continuous follow-up, the imple-
mentation of action plans for every
failure was possible in order to create
year-over-year improvements.
Critical Wells. All wells with more than
one failure per year were called criti-
cal wells. With a continuous follow-up
71
 Methodology Evaluates Artificial-Lift
Requirements Amid High Uncertainty

W hen evaluating artificial-lift

requirements, sometimes
data present uncertainties at the
Typically, artificial-lift evaluation
comes after the reservoir has a good
model and a defined exploitation scheme.
bubblepoint, reservoir pressure, GOR,
water cut, and time profiles, would be
provided later. The preliminary frame-
initial planning stage. This is the In this case, the selection of the artificial- work was used in the artificial-lift
case for a field that had 10 wells lift method dealt with high data uncer- screening procedure. Initially, no nat-
drilled but only four of them tainty associated with reservoir pressure, ural flowing condition was supposed,
producing after 6 years, at which gas/oil ratio (GOR), and water-cut pro- which simplified the process by discard-
point operations were suspended. files because of the reservoir’s complexity ing some methods.
The high-level plan was to exploit and pressure/volume/temperature (PVT)
and abandon the reservoir as soon properties. To overcome the uncertainty Sucker-Rod Pump (SRP). To produce
as possible. This paper presents and advance the study concurrently with 500 B/D at 10,000-ft true vertical depth
the integrated and structured an ongoing reservoir-simulation study, is beyond the capabilities of SRPs. Be-
methodology that was used to deal the following approach was adopted: sides, the hydrogen sulfide (H2S) and
with the high-uncertainty conditions. ◗ Understand and demonstrate how carbon dioxide would corrode the rods,
uncertainty in ABC affects artificial- necessitating too-frequent well inter-
Introduction lift selection. vention. Also, the stuffing box at surface
ABC is a small field that has 10 wells, ◗ Perform a preliminary artificial- is a potential leak point, which is unac-
out of which only four produced from lift-method screening for a matrix ceptable with high H2S concentrations.
1993 to 1999 while the remaining six covering a range of reservoir
were shut in after few months of produc- pressures, GORs, water cuts, and Progressing-Cavity Pump (PCP). A PCP
tion. Subsequently, the operations in ABC wellhead pressures in order to also uses a rod and stuffing box, with the
were suspended and the surface facili- discard some methods and focus same corrosion and leaking problems as
ties were mothballed. Because of attrac- on possible solutions. SRPs. Additionally, light oil will attack
tive remaining reserves along with high ◗ Build a matrix to determine the the PCP elastomer and damage the pump
reservoir pressure, and considering that conditions under which the wells quickly. Consequently, PCPs—both rod
this field is in an urbanized area, a plan flow naturally and those under and submersible-motor-driven types—
was requested that would deplete and which artificial lift is required. were eliminated.
abandon the reservoir as quickly as pos- ◗ Determine the probability of the
sible. Because of the adjusted time frame scenarios in relation to the results Continuous Gas Lift (CGL). Where gas
for the project, developing and planning of reservoir-simulation work. lift surface facilities are readily available,
this task required a preliminary analy- CGL would be a preferred method. The
sis using the available data acquired dur- Preliminary Screening option to install gas lift surface facilities
ing the 6 years of operation and some of Artificial-Lift Methods was discarded by the development team
complementary reservoir studies. Be- The existing information and prelimi- for economic and implementation-time
cause ABC is a complex reservoir with nary analysis collected during working considerations. This decision is support-
natural fractures and varying condensate sessions provided a preliminary initial ed by the fact that there is no high-
composition, the reservoir-model uncer- framework to advance the artificial-lift pressure gas source at the location.
tainties were difficult to minimize with selection. The remaining and validated
data from only four wells and 6 years data required for proper artificial-lift Intermittent Gas Lift (IGL). Besides
of history. design, including productivity index, having the same issues as CGL in the
ABC project, IGL is unable to handle
the target rate of 500 B/D. In addition,
This article, written by Special Publications Editor Adam Wilson, contains highlights
IGL is usually applied for very low rates
of paper SPE 177436, “A Systematic, Integrated Approach To Evaluate Artificial-Lift after reservoir pressure has been de-
Requirements While Dealing With High Uncertainty,” by S. Caicedo, C. Montoya, pleted with CGL, which would be the
J. Abboud, and S. Tiar, Abu Dhabi Company for Onshore Petroleum Operations, final, or abandon, condition requested
prepared for the 2015 Abu Dhabi International Petroleum Exhibition and Conference, by management. Therefore, IGL makes
Abu Dhabi, 9–12 November. The paper has not been peer reviewed. no sense for ABC.

For a limited time, the complete paper is free to SPE members at www.spe.org/jpt.

72 JPT • JULY 2016

Jet Pump (Closed Loop). The typical
configuration, in which the production
liquids are separated and used as power
fluid at the wellhead, cannot be applied
because its application implies con-
structing fluid-handling and -separation
facilities at the wellsite and implement-
ing special logistics for several wells,
all of which involves cost and risks
associated with handling high H2S in
the area.
Jet Pump (Open Loop). This uncom-
mon configuration uses an external
water source as the power fluid to drive
the jet pump. Preliminary simulations
showed that, for ABC wells, the injec-
tion rate of the power fluid is approxi-
mately three times the rate of the pro-
duced reservoir liquid. The combined
produced fluids must be pumped to and
separated at capacity-constrained facili-
ties. Modifications to handle extra fluids
would require investment and engineer-
ing that did not pass economic evalu-
ation; therefore, open-loop jet pumps
were ruled out.
Continuous Nitrogen Lift (CNL).
CNL was technically feasible from an
artificial-lift point of view because it is
equivalent to CGL. To reduce the costs
of transfer lines, ABC would require a
continuous-nitrogen plant at the loca-
tion, which is not suitable for an urban
area because of the footprint and noise.
Electrical Submersible Pump (ESP).
Because of projected high gas/liquid
ratio, only the most advanced ESP gas-
handling technology, which uses axial
gas-handling pumps, was considered
feasible. Axial impellers can handle 60%
free gas at the modeled pump-intake
pressures. Furthermore, for higher reli-
ability and to reduce intervention cost,
high-temperature ESP technology was
considered. Typically, the motor tem-
perature rating is 500°F and the mod-
eled motor internal operating temper-
ature is 350°F. Standard ESPs would
operate outside the design envelope of
20% gas/liquid ratio and internal motor
temperatures of 350°F.
Because of all the subsurface- and
surface-related issues, only ESP ad-
vanced technology was considered as
a valid option for ABC if the wells re-
JPT • JULY 2016
quire artificial lift, and then only within a
certain envelope.
Nodal Analysis
for Sensitivity-Matrix Ranges
The preliminary artificial-lift screen-
ing assumed no natural-flow condition
because of the lack of information in
the initial framework. However, deter-
mining which wells require artificial lift,
and when and under what conditions,
is a task to perform once the reservoir
model is matched. In order to advance
in the evaluation, after the data valida-
tion was completed, the artificial-lift ex-
perts agreed with the reservoir and sur-
face engineers on some possible ranges
or sensitivity matrices that covered the
values and uncertainties reported in the
preliminary data relying on four well-
production profiles.
All possible combinations of GOR, res-
ervoir pressure, water cut, and flowline
pressure were considered. Nodal analy-
sis was performed to evaluate the matrix
natural-flow condition.
The evaluation demonstrated that
◗ For flowline pressure of 100 psi,
relying on a multiphase surface
pump and water cut less than
50%, the wells will flow naturally
for all the values of GOR when the
reservoir pressure is greater than
2,500 psi.
◗ For a wellhead pressure of 700 psi
(no multiphase pump at surface),
the wells will require artificial lift
when the reservoir pressure is less
than 2,500 psi and GOR is less than
10,000 scf/bbl.
◗ Artificial lift is required when the
water cut reaches 90%, especially
if GOR is below 3,000 scf/bbl.
For cases in which nodal analysis
showed artificial lift to be required, the
ESP option was selected and modeling
was conducted. Advanced gas-handling
ESPs that deploy axial fluid compres-
sion in addition to centrifugal pumps
were considered. With natural flow,
the nodal analysis showed that the liq-
uid rate ranges from 500 to 1,500 B/D.
In the case of no flow, the target rate
for ESPs was expected to be 500 B/D to
re-establish production.
The nodal analysis of natural flow and
the ESP design demonstrated that, as a
consequence of high GOR and high res-
ervoir pressures, when the water cut is
below 90%, no artificial lift is required
in most cases. Paradoxically, once the
wells stop flowing naturally, ESPs cannot
be applied to most of the cases because of
the high free gas into pump. On the other
hand, when water cut reaches 90%, ESPs
can be applied only if the GOR is lower
than 1,500 scf/bbl.
Reservoir-Simulation Scenarios
The results and conclusions are based
on well-inflow and outflow nodal analy-
sis representing steady-state conditions.
However, dynamic reservoir simulation is
necessary to predict in which wells these
scenarios are likely to occur and when
these conditions are going to happen.
Reservoir modeling and PVT analysis
showed that, essentially, ABC is a con-
densate reservoir with an expected av-
erage GOR greater than 10,000 scf/bbl,
with a minimum of 7,000 scf/bbl. The
expected average water cut was approxi-
mately 50%, and the highest predicted
before abandonment is 85%. The cur-
rent reservoir pressure is 3,400 psi, and
the abandonment reservoir pressure is
approximately 2,500 psi, with an associ-
ated abandonment rate between 50 and
100 B/D.
Using the nodal-analysis results and
identifying the scenarios predicted by
reservoir simulation, the final artificial-
lift evaluation is obtained as follows:
◗ The wells are capable of natural
flow at the required flow rates and
drawdown to a reservoir pressure
of 2,500 psi and wellhead pressures
of 350 psi.
◗ As the gas/liquid ratio in the
wells increases, ESPs are not
suitable and cannot be considered
for contingencies or to boost
production.
◗ Surface multiphase pumps could
be used for the following cases:
o To boost production and
accelerate reservoir depletion.
o To ensure production when
conditions are at their limits.
o When water breakthrough is
sooner than expected because of
natural fractures in the reservoir.
◗ Some unloading procedures may
be required, which can be achieved
with nitrogen lift, made easier by
using gas lift mandrels. JPT
73
 TECHNOLOGY FOCUS

New-Frontier Reservoirs I
Simon Chipperfield, SPE, Chief Production Engineer, Santos

With the current changes in the indus- [A]re we seeing the fracture stimulations; alternative prop-
try, are we seeing the demise of uncon- pant; and recycling more completion
ventional reservoir development? Let us demise of unconventional fluid. In other regions of the world,
review several recent industry indicators. developments? No, clearly where unconventionals are more imma-
Numerous 2016 published outlooks ture, such as Argentina, Saudi Arabia,
still forecast unconventional production
not. The unconventional and China, appraisal and exploration
to increase from 10% in 2016 to greater industry is adapting also continue for the most-attractive
than 25% by 2035 from sustained growth to deliver the energy unconventional plays.
in North America and China. By 2040, So, are we seeing the demise of uncon-
it is also expected that unconventional demands of the future ventional developments? No, clearly not.
supplies will account for nearly 90% of despite the low oil price. The unconventional industry is adapt-
North American gas production. This ing to deliver the energy demands of the
increase in unconventional-gas demand future despite the low oil price. The key
is expected to be driven by a fundamen- frontiers or challenges for the unconven-
tal global requirement for energy in the well costs have reduced by 45% below tional industry to grow are technological,
medium term that is affordable, abun- their 2014 average, with 50% of these geographical, commercial, and geologi-
dant, clean, and available. savings as a result of new technolo- cal. This feature highlights some of these
Are these forecasts still realistic in the gies. Shell is highlighting similar well- key frontiers being explored around
shorter term, when we are faced with cost reductions of 30% year on year. the world to ensure that the unconven-
a low oil price? I would argue that they The cost savings arise from many areas. tional industry does not just survive
are still realistic because, although the These include new drill-bit technolo- but thrives. JPT
industry is contracting, it is quite clear gy; replacing diesel with cleaner and
that companies are rapidly adapting to less-expensive natural gas for rig fuel;
the oil-price drop. Apache, for exam- pad drilling; fracture-stimulation opti- Recommended additional reading
ple, is quoting that unconventional- mization, including fewer and smaller at OnePetro: www.onepetro.org.
SPE 174754 Proving the Concept of
Unconventional Gas Reservoirs in Saudi
Simon Chipperfield, SPE, is chief production engineer at Santos. Arabia Through Multistage-Fractured
During the past 20 years, he has held positions in petroleum Horizontal Wells by Ali Al-Momin,
engineering (drilling, completions, and stimulation), production Saudi Aramco, et al.
engineering, and reservoir engineering. Chipperfield previously
OTC 25739 Offshore Methane Hydrates
worked for Shell International Exploration and Production. He in the Gulf of Mexico: A Study in Economic
was awarded the 2007 SPE Cedric K. Ferguson Medal. Viability by Jaeger Wells, Kiewit Energy
Chipperfield has held a number of leadership positions and has Group, et al.
authored or coauthored more than 20 technical publications in
SPE 176260 Unconventional Resources:
the areas of hydraulic fracturing, reservoir engineering, completion technology, and
The Next Generation—Assessing Coal
sand control. He holds a petroleum engineering degree with honors from the to Liquids, Oil Shale, Underground Coal
University of New South Wales. Chipperfield serves on the JPT Editorial Committee, Gasification, Microbial Coal Conversion,
serving as the hydraulic fracturing feature editor from 2006 to 2011, and on the SPE and Other Technologies With the SPE-
International Awards Committee and has served as a reviewer for SPE Production & PRMS by Douglas Peacock, Gaffney, Cline,
Operations. He can be reached at simon.chipperfield@santos.com. and Associates, et al.

74 JPT • JULY 2016

A Flexible “Well-Factory” Approach
to Developing Unconventionals

I n order for operators to grow
production and maintain profit
margins in unconventional-
resource plays, a “well-factory”
or “manufacturing-based” style of
development is often used. This
paper will analyze differing well-factory
approaches to unconventional assets,
with examples from the Wolfcamp
unconventional oil play in the Permian
Basin. An emphasis is placed on using
a well-factory model that enables
flexibility for project-execution teams
to optimize, while maintaining the
efficiency and execution speeds that
a classical factory model provides.
Introduction
With the relatively recent boom in
unconventional-resource plays, the con-
cept of manufacturing has been widely
proposed and applied to the upstream
industry. Many companies across the
globe have adopted well-factory models
and a manufacturing-based approach
in developing large-acreage positions
in unconventional plays. A common
theme across industry literature is the
claim that a manufacturing approach to
unconventional-resource development
leads to greater efficiencies with re-
gard to drill days and well costs. These
improvements are largely attributed to
supply-chain and contract optimiza-
tion, logistical efficiencies, and materi-
als management. A common theme in
literature devoted to the well-factory
approach, however, is the lack of dis-
cussion concerning well recoveries and
maximizing reserves. By focusing only
on costs and cycle times, decisions are
This article, written by JPT Technology Editor Chris Carpenter, contains highlights
of paper SPE 175916, “The ‘Well-Factory’ Approach to Developing Unconventionals:
A Case Study From the Permian Basin Wolfcamp Play,” by Jarrad Rexilius, Chevron,
prepared for the 2015 SPE/CSUR Unconventional Resources Conference, Calgary,
20–22 October. The paper has not been peer reviewed.
quickly made that can affect the ulti-
mate recovery of wells and therefore
diminish overall economic return from
the wells. A one-size-fits-all approach
with standardized designs and strict
work processes can lead to suboptimal
economic development plans and erode
the value of oil projects.
Flexible and Adaptable
Factory Model
To date, the development philosophy of
many operators in the unconventional
space has been to drill as many identi-
cal wells as possible as quickly as pos-
sible. These metrics of speed and cost
have had the desired result of enabling
production growth for the develop-
ment area. However, operators are not-
ing that such a method often results in
many underperforming wells and more
surprises during the execution phase.
Practitioners are finding that subsurface
environments can change dramatically
over hundreds of feet, and that simply
drilling more of these wells in the same
fashion will lead to value erosion and
production inefficiencies. Another mis-
conception with these resource plays is
the notion that gathering of data—such
as openhole logs—is not important.
It is important that a factory model
provide sufficient flexibility to enable
operators to modify plans to prevent
poor economic performance of invest-
ments. There is a balance to be made
between use of this adaptive and flex-
ible approach and maintenance of the
efficiencies and economies of scale
provided from a well-factory style
of development.
Case Study:
Rex Field, Permian Basin
The Wolfcamp asset, like many
unconventional-resource plays, has
widely been deemed a “statistical play”
requiring a well-factory approach to drill
and complete hundreds (or thousands)
of wells in a standardized manner to de-
velop the resources most effectively. The
case study presented here showcases
the economic results achieved when
applying a more-strict well-factory
model vs. a flexible well-factory model
to a project involving two packages
of 12 wells.
Development of the Rex field initial-
ly began in 2012. After promising ini-
tial results, a well-factory approach was
put into place with an inventory of more
than 180 drillable locations with four
rigs in operation.
From a geological standpoint, the Rex
field is relatively complex; this inherent
subsurface heterogeneity creates chal-
lenges for a classical well-factory ap-
proach. The multiple reservoir targets
that exist in the Rex field include
◗ Upper Bend interval comprising
two distinct porous bedding
packages
◗ Lower Bend limestone/siliciclastic
section
◗ Two Wolfcamp B intervals
comprising organic shales and
stacked deepwater carbonate-rich
fan deposits
Well Package 1. Package 1 comprised 12
vertical wells, all drilled and complet-
ed with the same design. The execution
strategy was to drill all wells in the same
fashion in sequential order, with the aim
of minimizing rig moves between suc-
cessive wells. The wells were complet-
ed by plug-and-perforate multistage-
hydraulic-fracturing treatments and
were put on production immediately
following completion.

For a limited time, the complete paper is free to SPE members at www.spe.org/jpt.

JPT • JULY 2016 75

 Package 1 Execution Strategy

Weeks 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Drilling Well 1 Well 2 Well 3 Well 4 Well 5 Well 6 Well 7 Well 8 Well 9 Well 10 Well 11 Well 12

Completions Well 1 Well 2 Well 3 Well 4 Well 5 Well 6 Well 7 Well 8 Well 9 Well 10

1 Month of
Production
Well 1 Well 2 Well 3 Well 4 Well 5 Well 6 Well 7

Fig. 1—Package 1 execution strategy.

Package 2 Execution Strategy

Weeks 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Drilling Well 1 Well 2 Well 3 Well 4 Well 5 Well 6 Well 7 Well 8 Well 9 Well 10 Well 11 Well 12

Signpost Signpost Signpost Signpost

Data Gathered
While Drilling

Completions Well 1 Well 2 Well 3 Well 4 Well 5 Well 6 Well 7 Well 8 Well 9 Well 10

1 Month of
Production
Well 1 Well 2 Well 3 Well 4 Well 5 Well 6 Well 7

Ready-to-Drill Well 1 Well 2 Well 3 Well 4 Well 5 Well 6 Well 7 Well 8

Wells Available

Fig. 2—Initial Package 2 execution strategy.

The drilling rig typically completes
three or four wells before production
comes on line for the first well in the
package. Moreover, at least a full month
of production is needed to obtain a rep-
resentative initial production rate. As
shown in Fig. 1, with the fast pace of ex-
ecution and quick cycle times, the drill-
ing program is near completion when
the production from the first handful
of wells is sufficient to make a deci-
sion on continued execution and well
optimization. This is a challenge the
industry faces for unconventionals
in general.
Package 1 was executed with a clas-
sical well-factory model, and no well
data were used to drive decisions or
make changes to the execution plan. The
drilling order was such that rig moves
were minimized to enhance efficiency
and cost. In considering cumulative net
present value (NPV) from the Package
1 project, it can be seen that the initial
two wells had poor performance, while
the next two wells were strong perform-
ers. After that, there is a mixture of
high- and low-NPV wells and then sev-
eral poorly performing wells at the end
of the package. A detailed data analy-
sis suggests that the reservoir quality
was superior on the western part of the
acreage. This explains the difference in
incremental NPV seen throughout the
package. Toward the end of the package,
the results even began to erode value,
with successive wells drilled in a poor
area of the field. Because no signposts
were used to make changes to the execu-
tion plan, no attempt was made to alter
drilling plans or completion practices
on the basis of information acquired
during execution.
Package 1 is an example of an un-
conventional development in which a
strict well-factory model results in de-
sired low-cost and fast-cycle-time wells
but does not deliver optimal value from
an overall economic standpoint. It is
claimed that superior value creation
and economical returns could have been
achieved if a modified approach had
been employed for this 12-well package.
Well Package 2. Using the learnings
from Package 1, the Rex field team
looked at opportunities to improve
execution performance. Package 2 is a
12-well project with characteristics very
similar to those of Package 1. The proj-
ect is located in a similar area of the
field, has equivalent subsurface proper-
ties and reservoir quality, uses the same
well design, and targets the same forma-
tions at the same depths. During execu-
tion planning, the team implemented
three key changes to achieve improved
economic performance compared with
Package 1:
1. Used data gathering during drilling
and completions to drive decisions
throughout execution
2. Created a series of signposts and
used a modified well-factory
model that enables changes in the

76 JPT • JULY 2016

 execution plan to be implemented quickly on the basis
of the signposts
3. Planned backup ready-to-drill locations to provide the
team with the flexibility to adjust drilling plans on the
basis of signposts and continuous data analysis
Fig. 2 shows the initial drilling plan for Package 2, with the
addition of signposts and a series of backup well locations.
The flexible well-factory approach applied in Package 2 result-
ed in a shift in mindset within the team, which became focused
on quick decision making and decisiveness when key sign-
posts were revealed during execution. In planning for Pack-
age 2, subsurface signposts were created on the basis of infor-
mation acquired from mud-log data, openhole-log data, and
nearby-production-well production data.
After drilling the first four wells, data acquired suggest-
ed that the key reservoir target was of poor quality on the
northwestern part of the area, and of better quality toward
the southeast. The team was also able to use the acquired log
data to optimize fracturing designs to suit the observed rock-
mechanical properties. This resulted in two important chang-
es to the execution plan:
1. A change in the drilling order was implemented whereby
wells were to be drilled on the southeastern part of the The University of Utah offers an M.S. degree in petroleum
area only, and several backup well locations were now engineering designed for working professionals and
planned for execution. The northwestern locations were engineering graduates. The curriculum gives participants
removed from the drill plan. the up-to-date tools and expertise they need to stay on
2. The fracturing design for each well was modified to top of the oil and gas industry.
optimize production from the wells on the basis of the
reservoir characteristics.
• Program can be taken in 16 to 36 months through
In the actual drilling plan for Package 2, six backup wells
online-distance education or on campus.
were used, while six of the original planned wells were
not drilled.
• The 33-credit hour degree includes a work-related
When considering NPV from the Package 2 project, it can
design project or a master’s thesis.
be seen that the first and third wells had poor performance,
while the second and fourth wells were strong performers.
• Offers unique two-week field study in Utah and
This was the result of the geological changes observed across
Wyoming covering petroleum geology and
the field. The team regrouped after the first four wells and
operations.
conceived a revised execution plan. Wells 5 and 6 on the origi-
nal plan were drilled because they were located in the favor-
• Course work in drilling, geology, seismic, reservoir
able geological area. The remaining six wells, however, were
characterization and evaluation, production, mid/
dropped from the drilling plan because of their suboptimal
downstream, as well as in social and environmental
locations and were replaced with six backup wells that were in
issues.
higher-priority subsurface locations.
After the first four wells were executed in each package, the
• Taught by experts from the University of Utah’s
cumulative NPV is almost identical for Package 1 and 2. Like-
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wise, after six wells, the NPVs are similar for both drilling pro-
Energy & Geoscience Institute (EGI) with 150 years of
grams. However, the final six wells executed for each package
combined industry and academic experience.
diverge significantly in regard to economic returns. At the end
of the 12-well program, Package 2 shows more than twice the
cumulative NPV achieved in Package 1.
A key factor in the success of Package 2 was the gathering
(and analysis) of important data during execution to enable
optimization of drilling and completion tactics on subsequent
wells without slowing down the factory. JPT

For more information

visit www.che.utah.edu/pe
or contact pe@che.utah.edu
JPT • JULY 2016
 A More-Rigorous Development Framework
for Unconventional Reservoirs

M ajor oil companies have been

struggling as they attempt to
make the unconventional business a
profitable one. Indeed, the strategy of
building an unconventional portfolio by
means of mergers and acquisitions is
not providing a satisfactory return on
investment. This paper describes how
seismic reservoir integration, advanced
production analysis, and accurate
nanoscale and 3D full-field simulations
may address profitability issues and help
oil companies to be more efficient in
developing unconventional portfolios.
Introduction
While, from approximately 2008–2011,
independents were building and devel-
oping their US unconventional port-
folio, majors were trying to enter the
same business by means of multibillion-
dollar mergers and acquisitions. The
majors were not fast enough to be able
to repay the premium for this endeav-
or as a consequence of the combination
of a low-margin-profit type of business
and hydrocarbon-price evolution. Ma-
jors tend to be essentially process-driven
organizations; therefore, they are not
structured for rapid-decision-making
approaches. Furthermore, they quickly
align to the general concept of thinking
about unconventional plays as if they are
statistical ones. Their initial main effort
was essentially made for unit cost reduc-
tion, whereas technology innovation has
become a principal focus currently.
Key plays have experienced an impres-
sive production growth. If, on one hand,
the system is improving its efficiency, on
This article, written by JPT Technology Editor Chris Carpenter, contains highlights of
paper SPE 171913, “From a Standard to a More-Rigorous Development Framework for
Unconventional Reservoirs,” by I. Colombo, E. Spelta, D. Giamminonni, S.D. Russo,
F. Rotelli, and M. Rotondi, Eni, prepared for the 2014 Abu Dhabi International
Petroleum Exhibition and Conference, Abu Dhabi, 10–13 November. The paper has
not been peer reviewed.
the other, the incremental production is
also associated with a huge increase in
the average number of fracturing stages
per well.
Few attempts were made to optimize
wells and fracturing-stage placement by
applying a more-scientific approach. In-
deed, many sources estimate that only 40
to 60% of fracturing stages contribute
to well production when they are placed
on the basis of an equal-spacing strategy.
Technology as Driver for
Unconventional Development
The application of advanced technologies
is already providing interesting results in
mature plays. To avoid overdrilling and
overstimulating the play, the following
topics need to be addressed and investi-
gated at early developmental stages: shale-
gas production mechanism at nanoscale,
sweet-spot identification, proper fracture
placement and treatment, and reliable full-
field simulation of fractured wells.
In unconventional reservoirs, even if
thousands of wells are drilled, only a few
of them have a complete data set. Avail-
able data are often not sufficient to pro-
vide a comprehensive understanding of
the area. Production data show high vari-
ability even within pilot-well patterns.
To overcome this low spatial resolution,
a seismic inversion may be applied in
order to characterize geological and geo-
mechanical properties better.
Advanced Production Analysis
Shale production data can provide addi-
tional key information useful to define
the best exploitation strategy and give a
Fig. 1—Schematic of pad layout.
more-accurate reserves estimation. With
such an approach, interesting observa-
tions on the authors’ own asset were de-
rived, and then a revision of the develop-
ment strategy was implemented.
All producing wells were duly ana-
lyzed, obtaining the following param-
eters: linear-flow parameter (LFP), area
of the stimulated rock volume (SRV),
and gas in place (contacted at the time
of analysis). In particular, the LFP, con-
sidered as an indicator of hydraulic-
fracture-job effectiveness, was correlated
with other geological or well parameters
to obtain a better field characterization.
The first investigation concerned the
SRV area from the flowing material bal-
ance (FMB). It is important to empha-
size that, because of the long time need-
ed to reach boundary-dominated flow in
shale gas, the contacted portion of the
SRV evolves with time; therefore, the es-
timation is time-dependent. A theoreti-
cal drainage area is defined for each well
on the basis of the lateral length and well
spacing. The general development pat-
tern consists of two different landing tar-
gets within the same formation, referred
to as Lower and Upper (Fig. 1).
The estimated SRV area from FMB vs.
the theoretical one is plotted for each
well and grouped for the different land-
ing points. A higher number of the Upper
wells compared with the Lower ones

For a limited time, the complete paper is free to SPE members at www.spe.org/jpt.

78 JPT • JULY 2016

show a contacted SRV area greater than
the theoretical value.
Because there are no significant geo-
logical differences between the two for-
mations, this behavior was interpret-
ed as a production issue because of the
competitive drainage between Lower
and Upper wells. This is confirmed by
microseismic data that show a complete
superposition between the different
SRVs. This issue is a direct consequence
of the tight spacing that leads the Lower
wells to produce fracturing fluids from
the Upper wells.
Subsequently, the LFP was used as an
indicator of the fracture effectiveness.
The LFP seems to grow with well length
until the latter reaches a value of approx-
imately 6,000 ft, after which LFP is no
longer affected. This suggests that com-
pleting longer laterals may not be effec-
tive in terms of hydraulic fracturing.
3D Full-Field Simulations
In this study, two sectors were extract-
ed from the geological model to achieve
a clear understanding of well-to-well
interaction and optimal drainage area.
Then, by integrating information from
microseismic survey and advanced pro-
duction analysis, a dynamic model for
each sector was built with the so-called
Single Porositylike model. The approach
involved the modeling of complex hy-
draulic fractures (HFs) and SRV through
logarithmic local grid refinement.
Both sectors were used to match the
historical gas and water production, im-
posing bottomhole pressures as con-
straints. The history matches (HMs)
were useful in catching some key issues
of the field.
In the first sector (16 wells), the water-
production match was not achieved ini-
tially. Thus, the possibility of a local com-
munication between the stimulated vol-
ume and the aquifer was investigated.
Microseismic survey was not helpful in
understanding fracture extension to-
ward the aquifer. However, the evidence
of a higher-brittleness region below the
Lower target supported the idea of a local
communication between well and aqui-
fer. The HM was finally obtained by using
an analytical aquifer.
The HM in the second sector was used
to demonstrate the interaction between
wells at different spacing. This sector is
JPT • JULY 2016
intersected by 14 wells: 10 were spaced
at 250 ft, while the remaining four were
spaced at 500 ft.
The degree of interwell interac-
tion at different spacing was then used
to investigate optimal development
scenarios (see Fig. 1 for typical pad lay-
out). The wells producing under tighter
spacing are characterized by a sharp-
er production decline compared with
higher-spacing wells; this is caused by a
stronger interference.
Another kind of interference occurs
where the stabilization in production de-
cline between 200 and 400 days was
caused by a shut-in of a nearby well.
In addition, higher water production
caused by more-aggressive fractur-
ing jobs in higher-spacing wells was ob-
served. This is another clear indication of
play overstimulation.
Accurate Understanding
and Modeling of Shale-Gas
Production Mechanisms
at Nanoscale
The identification of sweet spots can be
achieved only if effort is expended to un-
derstand key production contributors.
The production from shale is the out-
come of different types of release pro-
cesses: advection, diffusion, and desorp-
tion. Neglecting even one of these flow
mechanisms may result in an underesti-
mation of the productivity.
The main differences in fluid mechan-
ics between micropores (conventional
reservoir) and nanopores (unconvention-
al resources) are related to noncontinuum
effects and the dominant surface interac-
tive forces. These two effects are negli-
gible when the size of the pores is large;
therefore, a simplified equation, such as
the Darcy equation, results in a reason-
able prediction for such systems.
Modeling gas production, and thus
making predictions, in shale formations
is still a challenging task. To understand
the typical physical processes associat-
ed with shale, it is extremely important
to describe the shale’s inner structure
and unique properties. In recent years,
great advances have been made in the
understanding of matrix geometry and
its petrophysics, thanks to the progress
in high-resolution diagnostic-imaging
methods, advanced numerical methods,
and computational speed.
The organic geochemistry group at
Kiel University has developed a unique
experimental setup, the “expulsion sim-
ulator,” to simulate oil and gas genera-
tion and expulsion under near-natural
conditions. The fluid components gen-
erated and expelled at a certain maturity
level need to be removed by primary and
secondary migration from the artificial
reservoir/carrier bed of the system, to
avoid reactions that would render closed
pyrolysis unsuitable to resemble natu-
ral generation and expulsion. Secondary
alteration of newly formed and released
products is thus minimized, and oils ex-
pelled at various stages of the experiment
resemble results of a natural maturation
and expulsion sequence.
After performing this experiment, the
intact rock samples can be retrieved and
studied with respect to changes in rock
matrix and kerogen composition by use
of microscopic petrophysical techniques.
This will allow investigation of the influ-
ence of rock matrix on retained oil and
gas amount, composition, and flow prop-
erties. By means of this apparatus, out-
crop samples are used to generate artifi-
cial samples representing the evolution
of the same source rock up to different
levels of maturation, characterizing also
the generated hydrocarbon.
Realistic Simulation
of Complex Fractured Wells
The combination of full-field reservoir
simulators with well-scale modeling
tools has been demonstrated to be re-
liable in defining work flows used to
model unconventional wells. One crucial
step in improving the predictivity is to
properly model HF and natural-fracture-
network interactions, keeping the well
geometry close to reality. This implies
a coupled approach with regard to geo-
mechanical and dynamic modeling. Fur-
thermore, the complex fluid-flow mech-
anisms and interactions with rock pores
increase the challenges regarding the
physical and chemical description and
the subsequent equations to be imple-
mented. Effects related to the extremely
low permeability and severe heterogene-
ity, such as osmotic pressure, slip flow,
Knudsen diffusion, and adsorption/
desorption, are believed to strongly af-
fect hydrocarbon storage/production
and SRV creation. JPT
79
 Production Performance in the In-Fill
Development of Unconventional Resources

Bakken System
D ata now show that the behavior
of unconventional wells to
in-fill drilling varies significantly
Parent-Well Modeling
Petrophysics. The Middle Bakken mem-
breakdown pressure would enable multi-
ple perforating clusters within a stage to
break down, especially when high pump
across basins. A key influence may ber was divided into three main facies. rates are used. When parent-well sliding-
be changes in pore pressure and Petrophysical evaluation indicates that sleeve (SS) treatments were modeled, a
saturation (saturation history). average porosity and average water satu- large single dominant fracture was ob-
This paper presents results from ration were 8 and 50%, respectively, for served. When parent-well PP treatments
the analysis of the effect of in-fill the Middle Bakken. Average Klinkenberg were modeled in the same area, propaga-
drilling on parent-well performance, permeability for the entire Middle Bak- tion of multiple fractures was confirmed
and describes a simplistic ken is approximately 0.02 md. Mercury- by both fracture and production mod-
approach to understanding the injection capillary pressure curves indi- eling. Fracture modeling indicated that
effect of the quest for operational cate that irreducible water saturation is two dominant fractures were propagat-
efficiencies and economic cycles on between 30 and 40% for rock with po- ing, and, because some uncertainty exists
development strategies. rosity between 1 and 7%. Residual oil is in the history-matching process, a distri-
between 30 and 40%. Accordingly, the bution of fracture lengths and conductiv-
Methodology moveable fluid is low (20–40%), and hy- ities was provided for production-history
This study focuses on two unconven- draulic fracturing was recommended to matching. The PP individual geometries
tional plays, the Eagle Ford and the stimulate more production. were approximately 60% smaller than
Bakken. The objective was to model the The Three Forks formation was divid- those of the SS treatment.
well performance of the parent wells ed into five facies. Petrophysical evalua-
with the aim of matching and pre- tion suggests that the upper part of the Production Modeling. As operators
dicting in-fill-well performance. Be- Three Forks, Facies TF 23, has oil poten- transitioned to PP in the Bakken, job
cause the two assets are at two sig- tial. Most facies are strongly affected by sizes were also reduced. This resulted in
nificantly different portions of the calcite and dolomite diagenesis, which the creation of a large surface area with
development cycle  (Eagle Ford is very allows alternating porosity development reduction in fracture length. Four years
early in its cycle), the Bakken data in some cases. In this area, the Middle of daily production and pressure history
set has the luxury of modeling and and Lower Three Forks have higher water was matched, and forecasting was per-
matching the performance of the par- saturation, with very-low-permeability formed. Flowing-bottomhole-pressure-
ent and in-fill, whereas the Eagle Ford streaks (less than 0.007 md). gauge data were used to constrain the
portion of this study focuses on for- history match (long-term compac-
ward modeling and optimizing in-fill- Fracture Modeling: Middle Bakken. tion). The early time of production and
well completions. Analysis on the Bakken wells in the pressure was matched with core and
The methodologies used in this study study area indicated high (greater than proppant-conductivity/effective-stress
(parent-well modeling, petrophysical 1,500  psi) net pressures and low break- relationships. High confidence was
models, geomechanics, fracture mod- down pressure. This indicated that a placed in the early-time data because
eling, production modeling, and in-fill- plug-and-perforate (PP) completion of offset flowing-bottomhole-pressure
well/depletion modeling) are discussed methodology could yield success. In this gauge data. Compaction curves from
in detail in the complete paper. study area, the high net pressures and low core and proppant were used to model
degradation of proppant conductivity
This article, written by JPT Technology Editor Chris Carpenter, contains highlights and rock compaction. Additional dam-
age had to be added after 2 years of pro-
of paper SPE 175963, “Production Performance in the In-Fill Development of
duction to match the fluid-level mea-
Unconventional Resources,” by Bilu V. Cherian, Sanjel; Matthew McCleary, Samuel
surements. It was concluded that the
Fluckiger, Nathan Nieswiadomy, Brent Bundy, and Sarah Edwards, SPE, SM damage mechanism observed was scale.
Energy; and Rafif Rifia, Kristina Kublik, Santhosh Narasimhan, James Gray,
Olubiyi Olaoye, and Hamza Shaikh, Sanjel, prepared for the 2015 SPE/CSUR Fracture and Production Modeling:
Unconventional Resources Conference, Calgary, 20–22 October. The paper has not Three Forks. Fracture modeling in the
been peer reviewed. Three Forks indicated that the SS treat-

For a limited time, the complete paper is free to SPE members at www.spe.org/jpt.

80 JPT • JULY 2016

ments connected into the Middle Bak-
ken because of the creation of a large
single dominant fracture. Production
modeling confirmed this and indicat-
ed that the connection to the Middle
Bakken was stress-sensitive and dete-
riorated within the first 3 months of
production. A separate set of compac-
tion curves was created for connectivity
into the Middle Bakken as represented
by the fracture geometry from com-
pletions modeling. Flowing bottomhole
pressure and water cut indicated that a
well under study was connected to the
Middle Bakken for a significantly longer
time than expected. This SS Three Forks
well had a permeability of less than
0.005 md, fracture half-lengths ranging
from 100 to 150 ft, and a dimensionless
conductivity greater than 10. In the PP
Three Forks treatments, connectivity
to the Middle Bakken was poor because
of the addition of multiple clusters per
stage (by PP) and subsequent reduction
in job volume per fracture propagating
in a stage.
Optimization With No Parent-Well In-
fluence. Once the multidomain iteration
was complete and models with quanti-
fied uncertainty ranges were built, pre-
dictive (optimization) modeling could
begin. For the fracture-length and
number-of-stages optimization, the
bounding wells were used to ensure ac-
curate forecasting on long-term perfor-
mance of the middle well.
Forward-modeling (optimization)
runs indicated that a hybrid-cluster ap-
proach could be used to maximize
fracture-propagation success. Optimal
job-size volumes, fracture-treatment
rates, and stage count were determined
for the Middle Bakken and Three Forks. It
was indicated that the maximum produc-
tion is obtained by increasing the number
of fractures in a well by a factor of four.
If a PP approach is used, fracture model-
ing has demonstrated the pump rates re-
quired to propagate two to five clusters
and the resulting job-size requirements.
Bakken System In-Fill-Well/
Depletion Modeling
Production matching of the in-fill drill-
ing and interference of a parent well
confirmed that scale was the damage
mechanism. This observation and the
JPT • JULY 2016
scale-treatment history of a study well
resulted in the hypothesis that the rela-
tively fresh water from the fracture treat-
ments dissolved the scale in the parent
well. Numerous cases of in-fill interfer-
ence have been reported in the basin over
the past few years. To date, the effects of
interference on the parent well have been
primarily related to additional stimula-
tion. Modeling results indicate that it is
unlikely that sufficient amounts of prop-
pant would travel those distances, even
under asymmetrical conditions. Thus,
scale dissolution may also be contribut-
ing to the sustained production enhance-
ment of the parent wells.
Eagle Ford System - or -
Parent-Well Modeling
Work flows and procedures for the char-
acterization and testing (calibration re-
quirements) of rocks that are both the
source rock and the reservoir have
Time Shift™ Technology
evolved significantly from those used in
conventional plays.
Petrophysics. Petrophysical evaluation Time Delay for reliable
indicates that average porosity and aver- multiple actuations
age water saturation were greater than
9% and less than 18%, respectively. The
petrophysical-model results show that Port Jetting™ Technology
the permeability ranged from 100 to
900 nd. Modified permeability relation-
ships were built for the organic portions TORQ Thru™ Technology
of the reservoir.
Fracture and Production Modeling.
Withstands burst pressure in
A modeling work flow was used to un-
excess of 20,000 psi
derstand fracture geometry and con-
strain production history-match param-
eters. High net pressures in the Eagle
Ford enabled the breakdown of mul- Advance Port Jetting™
tiple clusters. Modeling indicates that Technology
some optimization opportunities still
exist within the multicluster-fracturing
scenarios, because only 30–50% of Time Delay Settings of 15, 30,
the fractures within a stage can be- 45, or 60 minutes
come dominant fractures. The integra-
tion of high-tier-log and core data was
used to guide the production-history SmartStart Plus® Time Delay + Frac Valve
match. Production-history matches QuickStart® Inject + Frac Valve
honored the relative change in fracture
Competitor
half-lengths within a stage. Productive-
fracture half-lengths varied from 50 to
200  ft, and permeability ranged from
70 to 500 nd. More than 2 years of pro-
duction history was matched on two
parent wells.
2016 SPE
Deepwater Drilling
and Completions
Conference
14–15 September 2016
Moody Gardens
Convention Center
Galveston, Texas, USA
Fig. 1—Example of depletion profile from asymmetric propagation and fracture
geometry (from large-job-size design) as a result of the in-fill drilling between
two parent wells in the Eagle Ford.
The importance of layering effects
in most unconventional plays is lead-
ing operators to realize that draining
a thick reservoir column with multi-
ple laterals can improve production
performance significantly.
Eagle Ford System In-Fill-Well/
Depletion Modeling
This study and others have shown that
the effect of the interference is a function
of the size of pressure drop that exists, of
how far this pressure sink extends into
the reservoir, and of the reservoir fluids.
Overestimation of vertical connectivity
can result in the underestimation of the
depletion sink.
Once production-history matching
was performed on the parent well, the
new stress state was recomputed to
model the effect of fracture propaga-
tion between two parent wells. Poros-
ity, permeability, and saturations were
updated in the depleted area. Frac-
Explore new technologies ture modeling indicates that produc-
and practices to meet tion from the upper benches can cre-
current challenges ate improved containment and create
weak points that result in height growth
in deepwater basins. that would not be observed under vir-
gin conditions. Direct interference is
observed when laterals are in the same
Register Now! landing interval, and indirect interfer-
ence is observed when the laterals are
www.spe.org/go/16DDC not in the same landing location. This
indirect interference is hypothesized to
be a result of the interaction of the new
hydraulic-fracture system with the ex-
isting hydraulic fractures.
On the basis of the forward models,
in-fill treatments were designed to mini-
mize asymmetrical effects and direct in-
terference with the offset wells (Fig. 1
shows the effect of large design; opti-
mized design is not shown).
Conclusions
◗ With long-term production
lengths making up less than
10% of hydraulic lengths, it
becomes evident that minimizing
asymmetry is critical.
◗ Parent-well modeling is critical
to understanding which
wells are within the region of
interference.
◗ The success of the in-fill design
is determined by the ability to
characterize the current production
system in order to understand the
extent of depletion.
◗ Observation of the potential
challenges and redesign of the
completion program has resulted
in significant success.
◗ Fracturing wells from the east/
west end of a unit and sensitizing
the location of the parent well
on either end of the unit results
in differences in production
◗
lengths.
The introduction of a model-based
approach to improve decision
making will reduce the cycle time
between the initial wells drilled
and the optimal development
strategy. JPT
JPT • JULY 2016
 Interwell’s solution saved the client
over 14 months of workover time

VERIFYING
BARRIER
INTEGRITY
WITH BVS
A client in Central Europe needed to recomplete a gas
cavern, but were limited by available techniques
and regulations. The traditional method required removal
of gas by flooding the cavern with water, replacing the
completion, then removing the water; a total operation
taking approx. 16 months.

Instead, a solution to install a dual barrier and verify

integrity by Barrier Verification System (BVS), was
presented to and approved by the authority.

• Two High Expansion (HEX) plugs installed

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000081_Annonse_BVS_0516_1.indd 1 10.06.16 13.37

 TECHNOLOGY FOCUS

CO2 Applications
Sunil Kokal, Principal Professional, Saudi Aramco

Carbon dioxide (CO2) has been in the We know our reservoirs, we securely into them. Supercritical CO2
news a lot. We have all heard about is an excellent solvent, especially for
global climate change. Chances are your have produced from them, lighter crude oils. If it were free, or
child in elementary school has also and we can ensure that CO2 as low in cost as water, we would be
heard about it. It has been center stage injecting CO2 instead of water for its
in all local, national, and international
can be sent back safely favorable properties.
political and environmental debates. I and securely into them. So how can we help? There are many
am not going to talk about it here. What areas and applications of CO2 in the
I am going to articulate here is what oil and gas industry. CO2 enhanced oil
we can do about it in our own way. By CO2 first has to be separated from nitro- recovery (EOR) is the bedrock and the
“we,” I mean we as individuals, we as gen, then compressed, and finally piped mainstay in our application portfolio. A
SPE members, and we as oil and gas and pumped into a subterranean reser- lot has been published in that area. At
industry professionals. voir for oil recovery or storage. All of present, there remain several challeng-
First, the bad news: Indeed, there are these steps are expensive. es with CO2 EOR. These include grav-
a lot of challenges with CO2. It is a stable Now the good news: It can be done. ity override, poor sweep efficiency, and
compound and does not readily disin- And we, as petroleum engineers and economic factors. Considerable work
tegrate. The biggest challenge perhaps Earth scientists, are best suited to do it. and research are ongoing to address all
is the cost of capturing CO2. Most of We know our reservoirs, we have pro- of these challenges. The papers that fol-
the anthropogenic CO2 is available from duced from them, and we can ensure low address some of them: an example
fixed sources such as power plants. The that CO2 can be sent back safely and of chemical-looping emerging technol-
ogy in a bid to reduce CO2-capture costs;
CO2 foams for improved oil recovery;
Sunil Kokal, SPE, is a principal professional (senior adviser) and commercial-scale demonstration proj-
a focus area champion of enhanced oil recovery in the Reservoir ects; and use of CO2 in tight gas and
Engineering Technology team at the EXPEC/Advanced Research unconventional resources. JPT
Center at Saudi Aramco in Dhahran, Saudi Arabia. Since joining
Aramco in 1993, he has been involved in applied research proj-
ects on enhanced/improved oil recovery, reservoir fluids, hydro-
carbon phase behavior, crude-oil emulsions, and production- Recommended additional reading
related challenges. Currently, Kokal is leading a group of scien- at OnePetro: www.onepetro.org.
tists, engineers, and technicians to develop a program for CO2 enhanced oil recovery SPE 169039 Development of Small-
and to conduct appropriate studies and field demonstration projects. He has written Molecule CO2 Thickeners for EOR and
more than 100 technical papers and authored the chapters on Crude Oil Emulsions Fracturing by J.J. Lee, University of
and Reservoir Fluid Sampling for the revised edition of the SPE Petroleum Pittsburgh, et al.
Engineering Handbook (2006). Kokal has served as associate editor for the Journal
SPE 169022 Experimental Investigation
of Petroleum Science and Engineering and SPE Reservoir Evaluation & Engineering. of Enhanced Recovery in Unconventional
Earlier, he served on the Editorial Review Board of the Journal of Canadian Petroleum Liquid Reservoirs Using CO2: A Look Ahead
Technology. Kokal received the 2012 SPE DeGolyer Distinguished Service Medal, the to the Future of Unconventional EOR
2011 SPE Distinguished Service Award, the 2010 SPE Regional Technical Award for by Francisco D. Tovar, Texas A&M University,
Reservoir Description & Dynamics, and SPE Distinguished Member status (2008) for et al.
his services to the society. He also served as an SPE Distinguished Lecturer during SPE 171692 Carbon Capture and Storage
2007–08. Kokal holds a PhD degree in chemical engineering from the University of for Enhanced Oil Recovery: Integration
Calgary and a BS degree in chemical engineering from the Indian Institute of and Optimization of a Post-Combustion
Technology. He is a member of the JPT Editorial Committee and can be reached at CO2-Capture Facility at a Power Plant in
sunil.kokal@aramco.com. Abu Dhabi by A. Reichl, Siemens, et al.

84 JPT • JULY 2016

Chemical-Looping Combustion:
An Emerging Carbon-Capture Technology

CLC
I n chemical-looping combustion
(CLC), oxygen is transferred
from an air reactor to a fuel
CLC is a relatively new combustion tech-
nology that can be applied as a power-
At the heart of CL technology is the
oxygen carrier, which is indispensable
for transferring the oxygen to the fuel.
reactor by means of a solid production technique with inherent sep- A major part of current research efforts
oxygen carrier. Direct contact aration of CO2, and it is among the least is devoted to critical issues for upscal-
between air and fuel is avoided, costly technological options for the cap- ing of the oxygen-carrier-fabrication
resulting in an undiluted carbon ture of CO2. The technological concept technology. For fluidized-bed applica-
dioxide (CO2) exhaust stream. was first developed in the 1980s to pro- tion, the spray-drying technique ap-
As such, CLC has been identified duce CO2 and was identified only recent- pears to be very well-suited. Spray-dried
recently as a high-potential carbon- ly as a high-potential capture technology. oxygen-carrier particles are character-
capture-and-storage technology. The term chemical looping (CL) is com- ized by a high sphericity, good free-
While initial focus has been on monly used to describe cycling process- flowing and fluidization properties, and
storage projects, CO2 is increasingly es in which oxygen is transported by a homogeneity on the microscale. Promis-
considered as a valuable chemical solid material, referred to as an oxygen ing materials are nickel-, copper-, iron-,
substance for enhanced-oil-and-gas- carrier. For combustion processes, the or manganese-based. Some of these ma-
recovery projects as well as for the oxygen-depleted carrier can be regener- terials release oxygen at typical combus-
production of chemicals, polymers, ated by reaction with air or water. Such tion temperatures. This property is high-
or building materials. processes are known under the general ly desirable because it contributes to the
term CLC. Several variations of CL pro- full conversion of fuel.
Introduction cessing are possible for combustion of The first generation of spray-dried
Carbon capture, transport, use, and gaseous or solid fuels. Two specific pro- oxygen carriers was nickel-based, and
storage (CCTUS) form an important cess modifications are SR-CLC, in which upscaling of these oxygen carriers was
aspect of many national and global steam reforming is integrated into the demonstrated successfully with spray
strategies to combat climate change. CLC process, and CL reforming (CLR), drying. However, because of the cost
A main challenge regarding capture of of which the primary products are H2 and toxicity of nickel, a search for nick-
CO2, especially for high volumes, is its and CO. el-free oxygen carriers was initiated.
separation from other gases. The CLC process can be configured as Manganese, iron, or copper oxide, or
Three primary approaches are con- two coupled fluidized-bed boilers, but combined oxides, were used as main
sidered technologically feasible for CO2 packed-bed configurations, with the pos- active components; alumina and zir-
capture at large point sources: post- sibility of pressurizing, are also being conia were used as inert supports for
combustion capture, precombustion considered. To transfer oxygen from the increased strength and reactivity. The
capture, and oxy-fuel combustion. For combustion air to the fuel, oxygen car- complete paper discusses the influence
each approach, various technologi- riers are used. This avoids direct contact of the different steps in the manufactur-
cal solutions have been developed, and between air and fuel, and, after conden- ing process on the CLC performance of
small- and medium-scale evaluations sation of water, relatively pure CO2 is ob- oxygen carriers for a selection of calci-
have proved their feasibility. However, tained in a separate exhaust stream from um manganate materials with perovskite
integrated operation on a commercial the fuel reactor. Thus, energy-consuming crystal structure.
scale remains to be demonstrated. flue-gas separation is avoided.
Experimental Setup
This article, written by JPT Technology Editor Chris Carpenter, contains highlights Oxygen-carrier particles were produced
with good free-flowing properties, high
of paper SPE 177561, “Chemical-Looping Combustion: An Emerging Carbon-Capture
sphericity, and homogeneity using com-
Technology,” by Frans Snijkers, Flemish Institute for Technological Research; Dazheng
mercial raw materials by spray drying.
Jing, Chalmers University of Technology; Marijke Jacobs and Lidia Protasova, Organic additives were used to disperse
Flemish Institute for Technological Research; and Tobias Mattisson and Anders the powder mixture of inorganic ma-
Lyngfelt, Chalmers University of Technology, prepared for the 2015 Abu Dhabi terials in demineralized water. Plane-
International Petroleum Exhibition and Conference, Abu Dhabi, 9–12 November. The tary ball mills or horizontal attrition
paper has not been peer reviewed. mills were used to homogenize suspen-

For a limited time, the complete paper is free to SPE members at www.spe.org/jpt.

JPT • JULY 2016 85


Fig. 1—Spray-dry plant (left) and two-fluid nozzle configuration (right).
sions for small quantities or for larger
amounts, respectively.
Water-based suspensions were stirred
continuously with a propeller-blade
mixer while being pumped to the two-
fluid spray-dry nozzle, positioned in the
lower cone part of the spray drier (Fig. 1).
Air-in temperature was 220°C; air-out
temperature was 210°C. An air flow of
210 kg/h was maintained.
After spray drying, the fraction with-
in the required particle-size range was
separated from the spray-dried prod-
uct by sieving. To obtain oxygen-carrier
particles with sufficient mechanical
strength, sintering was performed in
air at top temperatures in the range of
1100 to 1350°C for 4 to 16 hours with
high-temperature furnaces.
The chemical composition and pos-
sible phase formations in the oxygen
carriers were investigated after the sin-
tering process with X-ray powder diffrac-
tion. The X-ray analysis was performed
on oxidized fresh samples and reduced
samples after the reactivity tests. The
shape and morphology of the oxygen car-
riers were studied with optical micros-
copy and scanning electron microscopy
(SEM). The force needed to fracture the
particles (i.e., the crushing strength) was
measured. The resulting value is an aver-
age of the values obtained for fractured
particles. The crushing-strength test
gives an indication of how resistant the
oxygen carrier will be toward fragmenta-
86
tion and attrition in a real fluidized-bed
CLC application. Evaluation of the CLC
performance of oxygen-carrier materials
was carried out. All materials were char-
acterized and tested either in a small-
scale batch reactor or by thermogravi-
metric analysis. Prospective materials
were selected for tests in small, continu-
ously operating CLC units, and the most-
promising materials were tested further
under continuous operating conditions.
Results and Discussion
A critical aspect of CLC processes is
oxygen-carrier performance, which has
a strong effect on the economic viabil-
ity of the technology. Parameters such as
particle size, density, porosity, strength,
attrition resistance, reactivity, and con-
version efficiency, along with environ-
mental aspects and cost, define the per-
formance of the oxygen carrier. Besides
the conversion efficiency, the mechani-
cal (crushing) strength of the particles
is extremely important because it de-
termines the resistance to attrition and
hence the operational-use hours (life-
time) of the particles. In general, 10,000
hours is a minimum targeted lifetime.
The relationship between attrition re-
sistance and the crushing strength is not
straightforward, yet a crushing strength
greater than 1 N is considered to be a
good indication for acceptable attrition
resistance. Attrition leads to fines, which
are filtered off; the fines-state lost mate-
rial needs to be replaced by addition of
new particles.
In this work, the CaMn0.9Mg0.1O3–δ
composition was selected. The mechani-
cal strength of the final product can be
tuned by parameters such as milling and
sintering conditions. The milling time
was varied, as well as sintering time and
temperature. All sinter treatments have
been performed in air. After sintering, the
particle-size distribution was found to be
within the specification of 100–200 µm.
No problems related to defluidization
and agglomeration were found during
the reactivity testing. In summary, the
calcium-manganite-based perovskite-
type material shows very promising re-
sults in terms of mechanical properties
and performance for CL.
SEM pictures allowed the morphol-
ogy of spray-dried particles to be ex-
amined. Comparing the fresh samples,
it is noted that the particles are less po-
rous after a prolonged period of mill-
ing. Similarly, longer calcination times
can result in a smoother particle surface
(i.e., less porosity). Increasing the calci-
nation temperature also had an effect on
particle morphology.
The materials show a high methane
conversion at 950°C. Activity data could
not be obtained for particles that showed
a low crushing strength and were tested
in fluidized-bed conditions. These experi-
ments, which were carried out in a batch
fluidized-bed reactor, used an oxygen/fuel
ratio of 57kg/MW. With respect to this bed
inventory, the rates of reaction are very
high and are comparable with those of
the baseline nickel-based oxygen carrier.
Conclusions
The fabrication of porous granules by
spray drying is a well-established man-
ufacturing method for a wide range of
products and industries. It is demon-
strated that this technique is also highly
suitable for the production of spherical
oxygen-carrier particles for CLC oper-
ated in coupled fluidized-bed reactors.
In this work, results are presented for
CaMn0.9Mg0.1O3–δ oxygen-carrier ma-
terials fabricated by spray drying, spe-
cifically with respect to some impor-
tant production parameters. Changes
to one of the parameters can affect the
properties of the oxygen-carrier mate-
rial dramatically. JPT
JPT • JULY 2016
Viscosity and Stability of Dry CO2 Foams
for Improved Oil Recovery

C arbon dioxide (CO2)/water foams

are of interest for mobility control
in CO2 enhanced oil recovery (EOR)
and as energized fracture fluids or as
hybrid processes that combine aspects
of both processes. It is challenging to
stabilize ultradry foams with extremely
high internal-phase gas fraction given
the high capillary pressure and the rapid
drainage rate of the lamellae between
the gas bubbles. However, the authors
demonstrate that these ultradry CO2-
in-water foams may be stabilized with
surfactants that form viscoelastic worm-
like micelles in the aqueous phase.
Introduction
In this study, the authors extend the study
of ultradry CO2/water foams composed of
worm-like micelles to higher tempera-
tures by adding an electrolyte, potassium
chloride (KCl), and a cationic surfactant,
decyldimethylamine (C10DMA), to the
primary surfactant, sodium lauryl ether
sulfate (SLES). The continuous-phase vis-
cosity and surface shear viscosity of this
formulation were found to be approxi-
mately two orders of magnitude higher
when worm-like micelles were formed at
room temperature. The foam morphol-
ogy was measured at high pressure with
microscopy, and a long lifetime of foam
bubbles was demonstrated. The mor-
phology of the worm-like micelles was
also characterized by cryogenic trans-
mission electron microscopy.
The authors have been able to manip-
ulate foam stability for various special-
ty applications such as EOR where low
water consumption, foam stability and
This article, written by JPT Technology Editor Chris Carpenter, contains highlights
of paper SPE 179690, “Viscosity and Stability of Dry CO2 Foams for Improved Oil
Recovery,” by Chang Da, Zheng Xue, Andrew J. Worthen, Ali Qajar, Chun Huh,
Maša Prodanović, and Keith P. Johnston, The University of Texas at Austin,
prepared for the 2016 SPE Improved Oil Recovery Conference, Tulsa, 11–13 April. The
paper has not been peer reviewed.
extended life span, and conformance of
the foams are crucial. In particular, these
high-quality stable foams have been de-
veloped and tested at laboratory scale in
high-salinity and high-temperature con-
ditions to mimic the actual reservoir con-
dition. These high-quality, highly stable
foams have been generated and tested by
use of sandpacks at the laboratory scale.
In this work, a numerical simulation of
foam injection into a layered reservoir
is performed.
Methods
The apparent viscosity of CO2/water foam
was measured with flow experiments op-
erated under high temperature and pres-
sure. Both the bead pack and capillary
tube were submerged in a water bath that
could be heated up to 90°C, and the sys-
tem was pressurized to 3,000 psia. Aque-
ous solution of SLES, C10DMA, and KCl
was loaded into an accumulator contain-
ing a piston. Before injecting CO2, approxi-
mately 10 pore volumes of solution (5 mL)
was pumped into the bead pack. Then,
both CO2 and surfactant solution were
injected into the bead pack, which func-
tioned as a porous-media foam genera-
tor. Next, the foam passed through a cap-
illary tube. The pressure drop across the
capillary tube was measured, and the ap-
parent viscosity was calculated. The volu-
metric flow rate of the foam was 0.5 mL/
min, which was equivalent to a superfi-
cial velocity of 190  ft/D. Then, the foam
passed through the microscopy view cell,
which, in turn, was connected to two car-
tridge heaters. The cartridge heaters were
connected to a temperature controller to
determine the temperature maintained
at the view cell. Finally, the foam flowed
through the high-pressure viewing cell,
where the macroscopic appearance of the
foam could be observed. Foam-stability
tests were conducted in a sapphire cell.
To evaluate the field applicability of
the novel dry-foam systems that the au-
thors developed, a 2D foam-injection-
simulation model has been developed.
The model development starts with der-
ivation of pressure and mass-balance
equations. The pressure equations form a
set of elliptical partial-differential equa-
tions. Water and hydrocarbons were as-
sumed as immiscible fluids. However,
CO2 solubility in the aqueous phase was
considered in the simulations. Transport
of the stabilizing reagent in porous media
is simulated with a single-site colloid-
filtration model. It was assumed that
surfactants reside only in the aqueous
phase. Foam transport is simulated with
a population-balance model.
Results and Discussion
Foam Apparent Viscosity and Mor-
phology. The foam quality was defined as
volume fraction of gas in the foam. Here,
experiments and analysis were focused
on ultradry foam with foam quality rang-
ing from 0.9 to 0.98. The apparent vis-
cosity for a foam with 3.6% SLES along
with 2% KCl solution increased signifi-
cantly when 0.4% C10DMA was added to
the aqueous-phase solution, and, thus,
worm-like micelles were formed, clearly
demonstrating that worm-like micelles
positively influence the foam apparent
viscosity. Moreover, when the tempera-
ture was raised to 90°C, the apparent
viscosity of foam remained high, which
suggested good thermal stability for this
surfactant formulation and the mainte-
nance of the desired packing fraction for
the worm-like micelles.
To understand the cause of the high
apparent viscosity better, the foam mor-

For a limited time, the complete paper is free to SPE members at www.spe.org/jpt.

JPT • JULY 2016 87


Fig. 1—Foam-stability test in a sapphire cell, (a) upon foam generation at time
zero and (b) after 1 day.
phology was determined with optical mi-
croscopy. With only SLES, worm-like mi-
celles were not formed and the bubble
size was large. Upon addition of the cat-
ionic surfactant to lower the head-group
area of the binary surfactant system,
worm-like micelles formed and the bub-
ble size decreased markedly, giving great-
er stablization to the lamellae. Because
worm-like micelles viscify the aqueous la-
mellae and reduce the drainage rate, rela-
tively thick lamellae are maintained over
long times even for ultradry foam.
High-Pressure
Foam-Stability Test
To verify the stability of the foams under
high-pressure conditions, they were gen-
erated with the pressure loop and then
were collected in a sapphire cell at a pres-
sure of 2,000 psi, with 90% quality. Be-
fore the injection of the foam, some prop-
pant sand grains were put on the bottom
of the sapphire cell. Once foam was gen-
erated, the sapphire cell was inverted
and images were taken of the sand set-
tling. Within several seconds, sand par-
ticles dropped to the middle of the cell
and, once trapped in the foam system,
their settling was stopped immediate-
ly. Even after several days, the trapped
sand particles in the foam system did
not move. Fig.  1 shows the experiment
results. Fig.  1a was taken at time zero,
while Fig. 1b was captured after 1 day. As
shown in the images, foam structure did
not visibly change and sand was trapped
inside the foam. Thus, the presence of the
proppant grains does not affect the foam
stability, and the dry foam has enough
88
strength to carry the proppant in any po-
tential fracturing applications.
Feasibility Simulation Results. A 2D res-
ervoir was defined with 27 ft in the vertical
(z) direction and 100 ft in the horizontal
(x) direction, in order to evaluate the oil-
sweeping efficiency upon foam injection
into the reservoir. It is assumed that all
gridblocks in the z-direction have a perfo-
ration in the middle; therefore, sweeping
fluid is injected uniformly through all lay-
ers at the constant flow rate of 0.365 pore
volumes/yr. Simulations were conduct-
ed for 0.4-pore-volume injection of the
fluid. In the first case study, the authors
assumed a homogeneous reservoir with
constant permeability of 1 darcy in the x-
and z-direction.
At the initial pressure and given tem-
perature of the reservoir, the fluid is all
in oil phase. Without foam, water drains
below oil and gas phases because of grav-
ity segregation and the gas phase mi-
grates to the topmost layer of the reser-
voir and escapes at the production well.
On the other hand, when high-quality
foams are injected into the reservoir, a
more-uniform front is formed, which sig-
nificantly reduces water drainage and also
slightly lowers gas escape from the top-
most layer. In a comparison, it is obtained
that, in this particular case study, in the
bottom layer, with no foam consideration,
the water front moves for nearly 65 grid-
blocks, whereas the water front in upper
layers is retarded at 15 to 35 gridblocks.
With foam consideration, the standard
deviation between the water displace-
ments in various layers is significantly re-
duced and, except for the topmost layer
filled with gas, the other layers all prog-
ress in the range of 25 to 40 gridblocks in
the x-direction. The decision was made to
analyze further the advantage of foam in-
jection in improving oil recovery.
The authors assumed a second case
in which vertical fluid transport is not
considered; however, the layers gradu-
ally become less permeable from the top
to the bottom of the reservoir. Earlier,
it had been shown that this is a success-
ful approach to visualize advantages of
foam injection into heterogeneous res-
ervoirs. In this case study, the layers are
assumed separated from each other, no
gravity effects are considered, and pres-
sure balance is solved only for the injec-
tion blocks. By controlling the confor-
mance of the sweeping fluid, it is evident
from the simulations that the foam devel-
ops a more-uniform front that enhanc-
es sweeping efficiency in regions with a
high degree of textural heterogeneity.
Conclusions
High-internal-phase ultradry foams with
high apparent viscosities of greater than
100  cp have been demonstrated for the
first time at elevated temperature. The
surfactant-packing parameter was tuned
by adding electrolytes and cationic sur-
factants to the anionic surfactant SLES
to form worm-like micelles, which aided
stabilization of the ultradry foam. Specifi-
cally, the slow-drainage-rate viscoelas-
tic lamellae maintained stability against
Ostwald ripening and coalescence. Fur-
thermore, the current study demon-
strates that this behavior could be extend-
ed even up to 90°C, at which the stable
foams with small bubble sizes produced
a high foam apparent viscosity. High-
pressure foam-stability tests in a sapphire
cell showed that, 1 day after starting the
experiment, foam had not lost its texture
and the terminal velocity of sand parti-
cles in the foam system remained zero.
Thus, the foam shows good stability in
high-pressure conditions as well as good
proppant-carrying properties.
Simulations for the homogeneous
reservoir with gravity considerations
showed that, in the foam case, the stan-
dard deviation of the water fronts (ex-
cept for the topmost layer) was reduced
by nearly 50% as compared with the no-
foam case. JPT
JPT • JULY 2016
A Portfolio of Commercial-Scale Carbon-
Capture-and-Storage Demonstration Projects

A major oil company is progressing

a portfolio of commercial-scale
carbon-capture-and-storage (CCS)
demonstration projects covering
an array of technologies that target
applications of relevance to the wider
oil and gas industry. A number of key Goldeneye
Platform
learnings have been obtained on the
technology-deployment and the critical- St. Fergus
project-development aspects of the Terminal
different project phases. This paper Peterhead
provides an overview of these learnings, Power Station
with a specific focus on the issues faced
by CCS-project developers.
Fig. 1—The Peterhead power station and project overview.
Introduction
Over the last decade, the company, with ◗ Operation of an existing gas turbine ◗ Storage in the depleted Goldeneye
its partners, has been helping to advance (GT 13) at the Peterhead Power gas reservoir at a depth of more
CCS through a series of CCS demonstra- Station in Aberdeenshire, Scotland than 2 km under the floor of the
tion projects. The operator’s CCS com- ◗ A new steam turbine dedicated to North Sea
mercial and project portfolio includes low-pressure steam generation The objective is that the power plant,
◗ The Quest project, which is the first ◗ Capture of approximately combined with the CCS chain, will oper-
CCS project of commercial scale in 1 million t/a of carbon dioxide ate as one integrated low-carbon power-
the heavy-oil industry (CO2) emissions, for a period of supply chain.
◗ The Peterhead CCS project, which, 10 to 15 years, from the flue gas in
if realized, could be the world’s first a large concrete absorber tower The Quest CCS Project
commercial-scale, full-chain project using the operator’s amine-capture CO2 management is also becoming in-
to demonstrate the feasibility of CCS technology creasingly important for manufacturing
at a gas-fired power station ◗ Regeneration of the amine in a tower and industrial sites or developments. This
This paper explores in detail the Quest using steam from the power plant is especially true for high-greenhouse-
project and the Peterhead project, the ◗ Compression and conditioning gas-intensity operations, such as those in
latter being currently in the front-end (oxygen and water removal) of Canadian oil sands.
engineering and design phase. the CO2 Quest is the world’s first commercial-
◗ Transport of the dense-phase scale CCS project in the oil sands, de-
The Peterhead CCS Project CO2 by an offshore pipeline signed to capture and permanently store
The company and a UK power provider approximately 100 km in length more than 1 million t of CO2 annually—
are developing the Peterhead CCS Project ◗ Injection of the CO2 with the adapted the equivalent of taking 250,000 cars
(Fig. 1). The scope of the project includes Goldeneye platform and wells off the road each year. It is an important
step toward producing oil-sands prod-
This article, written by JPT Technology Editor Chris Carpenter, contains highlights ucts with a lifecycle CO2 intensity on
par with the average crude oil refined
of paper IPTC 18469, “A Portfolio of Commercial-Scale CCS Demonstration Projects,”
in the US.
by W. Maas, M. de Nier, T. Wiwchar, and B. Spence, Shell, prepared for the 2015
The Quest project has been built on
International Petroleum Technology Conference, Doha, Qatar, 7–9 December. The behalf of the Athabasca Oil Sands Proj-
paper has not been peer reviewed. ect (AOSP) joint-venture owners and with
support from the governments of Canada
Copyright 2015 International Petroleum Technology Conference. Reproduced by and Alberta. The Quest facilities will cap-
permission. ture up to one-third of the CO2 emissions

For a limited time, the complete paper is free to SPE members at www.spe.org/jpt.

JPT • JULY 2016 89

 at the operator’s Scotford Upgrader site
near Edmonton, Alberta. At this facil-
ity, mined bitumen from AOSP’s Muskeg
River and Jackpine mines is upgraded to
produce up to 255,000  B/D of synthetic
crude. The upgrading requires hydrogen,
the production of which features CO2 as
a byproduct.
The CO2 is captured directly from
a syngas stream in the hydrogen-
manufacturing process by use of propri-
etary amine technology. This technol-
ogy is a widely applied process within
gas processing and liquefied natural gas.
Subsequently, the CO2 is compressed and
dehydrated. The dry, dense-phase CO2
is transported by a 64-km-long onshore
pipeline to the sequestration lease area
north of the Scotford facility. There, it is
injected into a saline reservoir—the basal
Cambrian sands storage formation at the
base of the central portion of the western
Canada sedimentary basin—for perma-
nent storage.
Collaboration To Advance
CCS Policy Frameworks
The Peterhead project, being the first full-
scale CCS project in the UK, is focusing
particular attention on the establishment
and attainment of the necessary permits
to operate. Regular meetings with key
regulatory authorities and information
sharing between subject-matter experts
are essential.
For the benefit of the regulators, the
local community, and the general public,
onshore and offshore impact-assessment
scoping reports were prepared in 2014.
These established the scope of work to
be covered by the detailed Environmen-
tal Impact Assessments (EIAs) describing
potential environmental impact associ-
ated with the scope of work for the Peter-
head CCS Project.
The Offshore EIA covers a wide range
of topics, from the mean low-water mark
(close to the Peterhead Power Station in
Sandford Bay) to the offshore Golden-
eye reservoir, including all work on the
wells, the existing Goldeneye platform,
and the proposed new section of pipe-
line. An environmental statement was
submitted to the appropriate authorities
in January 2015.
An Onshore EIA was also completed,
covering all elements of the project to
be constructed on the existing power-
90
station site. The resulting environmen-
tal statement and associated planning
application were submitted to the local
authority in March 2015 and received ap-
proval in June.
Quest collaborated with the govern-
ment to establish CCS policy frameworks
for Alberta, and for Canada in general.
The experience gained from Quest was
used to develop regulations more tai-
lored to CO2 storage. A measurement,
monitoring, and verification (MMV) plan
and a carbon-accounting protocol have
been developed to ensure containment
and conformance—the long-term effec-
tiveness of CO2 storage—by demonstrat-
ing that actual storage performance is
consistent with expectations about injec-
tivity, capacity, and CO2 behavior inside
the storage complex.
Communication, Public
Consultation, and Opportunities
The Peterhead CCS project has focused
resources to aid in informing and in-
volving key stakeholders, including the
communities closest to Peterhead, with
respect to the objectives of the project
and its potential impact. A series of com-
munication and consultation events has
taken place since late 2013, focusing on
different groups including community
organizations, high-school students, uni-
versity academics, and field profession-
als. Further engagement and education-
al initiatives are planned as the project
progresses in order to build on estab-
lished relationships. The project has
also attracted a significant amount of
media attention.
Quest met with individual landown-
ers along the pipeline right-of-way to
discuss the impact of the pipeline. As a
result of these discussions, the pipeline
route was adapted. All regulatory licens-
ing needed for Quest was completed in
face-to-face meetings, with communi-
cation opportunities afterward if ques-
tions remained. Similar to Peterhead, the
Quest project team also holds sessions
in Alberta for engagement with the pub-
lic. The first open house for Quest was
held in 2008, and many have followed
throughout construction.
Furthermore, the project secured sup-
port and public praise from influential
and credible external organizations. The
operator collaborated with the Pembina
Institute on stakeholder engagement.
The institute has a strong focus on re-
sponsible oil-sands development. This
partnership further developed discus-
sions with municipal leaders who were
closest to the landowners. Quest has
also established a community panel of
local leaders and stakeholders to review
data from the MMV program regularly
and to assist in sharing of information
regarding the design and operation of
the project.
Cost Reduction
Assuming that it proceeds, the Peter-
head project will set a cost data point
for low-carbon gas power, determined
by the project specifics and constraints.
Like all first applications, it will be an
initial point on a learning curve that
will be valuable for cost optimization on
commercial CCS projects and for identi-
fication of focus areas for cost reduction.
Specifically, equipment standardization
and simplification and supply-chain op-
timization have been shown to be prime
areas for cost reduction in comparable
energy industries. The UK CCS Cost-
Reduction Task Force has reported the
potential for gas CCS cost reduction and
the different elements required for its
execution and has demonstrated an ex-
pectation that future low-carbon gas
power with CCS will be competitive with
alternative low-carbon energy sources.
Quest managed to deliver the proj-
ect cost effectively in a high-cost labor
market at the time of fabrication and
construction. This was made possi-
ble through an emphasis on modular-
ization—the onshore-facility construc-
tion was based on offshore standards.
This delivered an integrated, tight de-
sign on a comparatively small plot
availability by stepping away from the
traditional stick-build backbone with a
central pipe rack and units to the side.
The modular construction considerably
limited the amount of on-site construc-
tion hours.
Quest has demonstrated that cost can
be reduced further with scale; if more
CO2 sources can be tied into the Quest
concept, the cost per tonne of CO2 could
be reduced further. To illustrate this idea,
the pipeline has been sized for 3.0 mil-
lion t/a for CO2—with up to 1.2 million t/a
of CO2 currently used. JPT
JPT • JULY 2016
CO2-Based Enhanced Oil Recovery
From Unconventional Reservoirs

I n this study, detailed petrophysical

and geological field models focusing
on the middle and lower members of
The Bakken CO2 Enhanced Recovery
and Storage Project began in 2012 and
was completed in 2013. The objective of
porate both matrix and fracture proper-
ties into one set of reservoir properties.
Thus, the reservoir-permeability prop-
the Bakken Formation were developed this project was to use reservoir char- erty will include fracture flow up to 300
on the basis of field characterization, acterization and laboratory analytical times the values measured in the matrix
well-log interpretation, and laboratory data (e.g., core analyses, well logs, and alone. This model would be clipped down
core analysis by scanning-electron- oil analyses) coupled with state-of-the- to an optimized near-wellbore model and
microscopy, ultraviolet-fluorescence, art modeling to examine the viability of used for dynamic simulation. Because
and standard-optical-microscopy using CO2 for simultaneous CO2 stor- this single-porosity/-permeability model
techniques. A fine-scale model with a age and EOR in the Bakken. The ultimate combined the matrix and fracture prop-
pair of horizontal wells was extracted goal of the project was to have a Bak- erties, the sensitivity of two sets of rela-
from the initial model (Bailey area) to ken operator apply the knowledge gained tive permeability curves (matrix system
examine the potential effectiveness of from the laboratory, characterization, and fracture system) was analyzed to find
oil-recovery techniques based on carbon and modeling activities to a pilot-scale out the incremental oil on the basis of the
dioxide (CO2) injection. The results show field test of CO2 injection into a Bakken relative permeability changes.
that CO2 injection may play a significant or Three Forks reservoir. The presenta- To address the systems response to
role in increasing oil production. tion in this paper comprises a discussion CO2 injection for oil production, four
of the initial near-wellbore-modeling as- cases were proposed on the basis of
Introduction pect of the project. the near-wellbore single-porosity/
Small improvements in productivity -permeability model.
could increase technically recoverable oil Approach
in the Bakken by billions of barrels. While A two-stage approach was proposed for Geological-Modeling
the use of CO2 in conventional reservoirs petrophysical and static modeling of the Development
is a widely applied and well-understood Bakken reservoirs. The first step was to A single-porosity/-permeability geocel-
practice, its use for enhanced oil recov- design a single-porosity/-permeability lular model of the Bailey Field study area
ery (EOR) in tight oil reservoirs is a rela- model of the study area from the data was built on the basis of a database con-
tively new concept. The use of CO2 as an available. While this initial model was taining geophysical well logs, well in-
injection fluid may reduce the hydrocar- being developed, advanced laborato- formation, stratigraphy, routine-core-
bon viscosities in the reservoir and allow ry tests and fracture analyses were per- analysis data, X-ray diffraction, X-ray
additional trapped oil to be produced. formed in order to guide the construc- fluorescence, scanning electron micros-
Another benefit of CO2 injection is to tion of an unconventional dual-porosity/ copy, and ultraviolet fluorescence. The
mitigate climate change by storing CO2 -permeability model, which is not includ- study area comprises 38 sq miles and
in the reservoir. The Energy & Environ- ed in this paper. includes 72 wells. Thirteen key vertical
mental Research Center has conducted a The model was constructed with avail- wells were used in an MMPA and strati-
multidisciplinary research program with able data, which included geophysical graphic correlation of lithofacies. Three
the ultimate goal of providing industry well logs, routine core analysis, and stra- of the key wells had preserved subsur-
with insight regarding the potential to tigraphy derived from viewing subsur- face core, which was described and sam-
use CO2 for EOR in the Bakken and Three face core. A multimineral petrophysical pled for routine, special, and fracture
Forks Formations. analysis (MMPA) was designed to incor- core analysis.
The MMPA determines the overall
quantity and volume of different mineral
This article, written by JPT Technology Editor Chris Carpenter, contains highlights
components in the key wells from the log
of paper SPE 168979, “CO2-Based Enhanced Oil Recovery From Unconventional
responses. This mineral-volume calcula-
Reservoirs: A Case Study From the Bakken Formation,” by G. Liu, J.A. Sorensen, tion aids in determining the stratigraphy
J.R. Braunberger, R. Klenner, J. Ge, C.D. Gorecki, E.N. Steadman, and J.A. Harju, and the overall correlation from one well-
University of North Dakota, prepared for the 2014 SPE Unconventional Resources bore to another, thus describing the geo-
Conference—USA, The Woodlands, Texas, USA, 1–3 April. The paper has not been logic structure for property distribution
peer reviewed. in the 3D model. MMPA can also assist

For a limited time, the complete paper is free to SPE members at www.spe.org/jpt.

JPT • JULY 2016 91


Case RPT CO 2 Recycle
1 Matrix No
2 Fracture No
3 Matrix Yes
4 Fracture Yes
Table 1— Results summary for all four cases. RPT=relative permeability curves (matrix or fracture systems).
in determining geochemical and geome-
chanical interactions of the bulk mineral
volumes and CO2.
The model was divided into four dis-
tinct lithofacies that were evident by se-
quence stratigraphy in understanding
mechanical zones, ichnology, and bio-
stratigraphic correlation among subsur-
face cores, MMPA, and fracture analy-
sis. A structural model was built on the
basis of these four lithofacies and capped
on the top by the upper Bakken shale
and on the bottom by the lower Bakken
shale. These six zones were represent-
ed by a grid-cell size of 33×33 ft later-
ally and an average of 0.5 to 1.0 ft verti-
cally. The study-area model has a total
of 50 million cells. Well logs were up-
scaled into the structural model, and a
data analysis was performed to develop
variograms for major, minor, and verti-
cal ranges—6,300, 5,000, and 3 ft, re-
spectively. These small variogram ranges
introduce strong heterogeneity into the
model both laterally and vertically.
Geostatistical methods were then used
to populate the structural model with
water saturation, effective porosity, and
permeability. Pressure and temperature
were determined on the basis of bottom-
hole parameters derived from drillstem
tests within the study area.
A fine-scale, near-wellbore model was
clipped from the study-area model to
test CO2 EOR by performing numerical
simulation. The selection of the clipped
model was based on a work flow to un-
derstand connected volumes on the basis
of effective-porosity and -permeability
cutoffs and then to choose two wells that
contain higher permeabilities from the
inclusion of natural-fracture properties
in the matrix model. The model size is
6,800×1,800 ft laterally and 40 ft thick,
with a grid cell size of 33×33 ft laterally
and an average of 1-ft thickness for 50
layers. The total cell count for the near-
wellbore model is 610,000.
92
Injection Rate Produced Oil Oil Change
(Mscf/D) (bbl) (%)
N/A 839 N/A
N/A 1,869 N/A
10 1,323 58
10 2,680 43
CO2-Injection Simulations
In this study, a pair of existing horizon-
tal wells with a spacing of 3,000 ft was
selected for the fine-scale, near-wellbore
model on the basis of the connected vol-
ume between wells that allows the fluids
to communicate with each other. In this
simulated case, Well A was designated as
a producer and Well B was designated as
a CO2 injector. However, only an 1,800-ft
segment of the horizontal wells is mod-
eled. It is assumed that these results and
the percent increase can be extrapolat-
ed to the entire length of each well. On
the basis of characterization results, two
three-stage hydraulic fractures were in-
corporated in each of the 1,800-ft sec-
tions. The hydraulic-fracture dimensions
are 300 ft in length by 2 ft wide, and
the permeability of the cells is 100 times
higher than that of the surrounding cells.
The CO2-injection well and oil-production
well were perforated only in the cells that
passed through the hydraulic fractures lo-
cated in the middle Bakken zones.
After the near-wellbore model had
been prepared for simulation, the re-
maining steps of the dynamic-modeling
work flow (detailed in the complete
paper) were followed.
The fluid model used in the simulation
system was calculated on the basis of lab-
oratory oil-compositional analysis and a
swelling test. A total of 40 components
were combined into five components to
generate the equation-of-state parame-
ters for the simulation. Two three-phase
relative permeability curves were used,
one which approximates the matrix rela-
tive permeability and one that approxi-
mates the fracture relative permeability,
to test the sensitivity for flow from each
on the model. The CO2 is also allowed to
dissolve into brine to mimic the nature of
the system.
To test CO2 recovery, four cases were
designed to address the potential for CO2
EOR in the Bakken. Cases 1 and 2 investi-
Incremental Stored CO 2 Net Usage
Oil (bbl) (Mscf) (Mscf/bbl)
N/A N/A N/A
N/A N/A N/A
484 11,213 23.17
811 4,750 5.86
gate oil production without CO2 injection.
Cases 3 and 4 introduced continuous CO2
injection to investigate the potential to
improve recovery compared with cases
without CO2 injection. The bottomhole-
pressure maximum was set on the injec-
tion well not to exceed 20% more than
the initial reservoir bottomhole pressure.
Results and Discussion
The results of the four cases, including
oil production, CO2 storage, and net CO2
use, are listed in Table 1. Net CO2 use was
calculated by dividing the total stored
CO2 by incremental oil produced during
the production periods. When compar-
ing the oil production, it is notable that
58% more oil was produced with CO2 in-
jection in Case 3 than without CO2 injec-
tion in Case 1. This results in an increase
in the cumulative oil production from
839 bbl in Case 1 to 1,323 bbl in Case 3.
The cases that used fracture relative per-
meability curves experienced a similar
increase when CO2 injection was used,
with oil production in Case 4 (2,680 bbl)
being 43% higher than that of Case 2
(1,869 bbl), which had no CO2 injection.
When the three cases were compared
on the basis of fracture or matrix relative
permeability, the cumulative oil produc-
tion was two to three times higher from
fracture relative permeability in Cases 2
and 4 than with matrix relative perme-
ability in Cases 1 and 3. This explains the
resulting lowered net CO2 use of cases
based on fracture when compared with
cases based on matrix.
On the basis of these results, CO2 in-
jection may play a significant role in
EOR in Bakken oil reservoirs. Using
CO2 may produce 43 to 58% more oil
than the cases without any CO2. Oil-
production results based on the model
matrix relative permeability or model
fracture relative permeability are quite
sensitive, leading to a 100 to 170%
oil-production difference. JPT
JPT • JULY 2016
PEOPLE

KHALID AL-FALIH, SPE, was appointed
minister of the newly expanded Ministry of
Energy, Industry, and Mineral Resources
for Saudi Arabia, succeeding ALI AL-
NAIMI as the minister of petroleum and
mineral resources. He was previously the
Al-Falih minister of health for Saudi Arabia. Al-Falih
was appointed chairman of the board of di-
rectors for Saudi Aramco in 2015 and will continue to hold that
role. He has served as the chief executive officer (CEO) and
president of Saudi Aramco since 2009 and held several senior
management roles at the company over the years, including
executive vice president of operations business center and se-
nior vice president of industrial relations. In 2001, he was ap-
pointed vice president of gas ventures development and
played an instrumental role in the country’s natural gas initia-
tive. He is a founding member of the board of trustees of the
King Abdullah University of Science and Technology and has
served on the board since 2008. Al-Falih holds a BS degree in
mechanical engineering from Texas A&M University and an
MBA from King Fahd University of Petroleum and Minerals.
PHANEENDRA KONDAPI, SPE, was ap-
pointed director of subsea engineering for
the College of Engineering at Texas A&M
University. He has more than 20 years of
experience in the industry including with
FMC Technologies and KBR in engineering
and consulting projects worldwide.
Kondapi has been recognized for his work in designing and
developing university-level curriculum in flow assurance and
subsea engineering and for his innovative teaching methods.
As the KBR adjunct professor of subsea engineering at the Uni-
versity of Houston, Kondapi helped develop the first subsea
engineering program in the US. He is the chair of the Offshore
Technology Conference Flow Assurance and Subsea Process-
ing steering committees and the SPE Faculty Innovative Teach-
ing Awards Committee. He has previously been chair of the
SPE Flow Assurance Technical Section and was a chair of the
SPE Flow Assurance: Future State of the Art forum in 2015. In
2013, he received the Outstanding Alumnus Award from
Andhra University College of Engineering in India and the SPE
Faculty Innovative Teaching Award. Kondapi holds a PhD from
Tennessee Technological University, and BS and MS degrees
from Andhra University, all in chemical engineering.
JONATHAN LEWIS, SPE, was appointed
CEO of Amec Foster Wheeler. He previous-
ly was senior vice president of the Comple-
tions and Production Division at Hallibur-
ton. His previous roles in the company
included senior vice president of Europe/
Sub-Saharan Africa region and the Drilling
and Evaluation Division. Lewis joined Halliburton after 9
years in academia, where he was a NERC research fellow at the
Royal School of Mines at Imperial College London, and Conoco
lecturer in petroleum geology at Heriot-Watt University.
He  was an SPE Distinguished Lecturer in 1996–97. Lewis
holds a PhD in reservoir characterization from the University
of Reading.
DOUGLAS PFERDEHIRT, SPE, was ap-
pointed president and CEO of FMC Tech-
nologies, effective 1 September. Current
CEO and Chairman JOHN GREMP will re-
main as chairman of the board until his re-
tirement in 2017. In May, FMC and Technip
Pferdehirt announced that the companies plan to
combine into a single entity to be called
TechnipFMC, and Pferdehirt will serve as the CEO of the new
company. The transaction is expected to close in early 2017,
subject to regulatory approvals. After a 26-year career with
Schlumberger, Pferdehirt joined FMC in 2012 as executive vice
president and chief operating officer and became president in
2015. He holds a BS degree in petroleum and natural gas engi-
neering from Pennsylvania State University.

Member Deaths
Gene C. Bankston, Spring, Texas, USA
Lewis C. Beach, Tulsa, Oklahoma, USA
Robert M. Boone, Midland, Texas, USA
Will E. Boyd, Austin, Texas, USA
Charles O. Childress, Metairie, Louisiana, USA
Roy T. Clayton, Oklahoma City, Oklahoma, USA
Francis R. Conley, Tulsa, Oklahoma, USA
David L. Dooley, Oklahoma City, Oklahoma, USA
Jack D. Duren, Arlington, Texas, USA
Clifford W. Dye, Houston, Texas, USA
Alfred O. Fischer, Shreveport, Louisiana, USA
Raymond E. George, Bloomfield Hills, Michigan,
USA
Oma K. Gilbreth Jr., Fort Collins, Colorado, USA
Richard Gillespie, Seminole, Texas, USA
James E. Goodson, Lewisville, Texas, USA
E.F. Gordon, Houston, Texas, USA
Billy D. Griffin, Edmond, Oklahoma, USA
Derrel G. Gurley, Alvarado, Texas, USA
Ralph B. Hammond, Weleetka, Oklahoma, USA
Robert L. Hansen, Beaumont, Texas, USA
Tom T. Jones, Oklahoma City, Oklahoma, USA
Gregory J. Kuran, Calgary, Alberta, Canada
Joseph S. Levine, Houston, Texas, USA
Jacques H. Marchal, New York, New York, USA
J.G. McMillian Jr., Park City, Utah, USA
Paul Meadows, Franklin, Tennessee, USA
Douglas F. Middleton, Houston, Texas, USA
Herbert D. Miller, Oklahoma City, Oklahoma,
USA
Perry B. Morris, Dallas, Texas, USA
Richard L. Murray, Bakersfield, California, USA
Walter F. Muzacz, Houston, Texas, USA
Craig R. Norton, Sherman Oaks, California, USA
Lawrence K. O’Bert, Houston, Texas, USA
Charles J. Parker Jr., Hot Springs, Arkansas, USA
Thomas L. Pearson, Roswell, New Mexico, USA
Jan N. Pedersen, Austin, Texas, USA
Bill E. Rae, Edmond, Oklahoma, USA
Maynard W. Russell, Tulsa, Oklahoma, USA
Forrest Scearce, Sand Springs, Oklahoma, USA
Robert E. Turrentine III, Midland, Texas, USA
J.E. Upton, Houston, Texas, USA
William S. Wright, Dallas, Texas, USA
James George Wood, Kobenhavn K, Denmark

JPT • JULY 2016 93

 SPE NEWS

Former SPE President Publishes New Book

In May Praeger published 2006 SPE President Eve Sprunt’s
book, A Guide for Dual-Career Couples: Rewriting the Rules.
Her advice on ways for both individuals to achieve career suc-
cess is based on a re-evaluation of traditional styles of work-
ing and focuses on productivity, flexibility, and negotiating
win-win solutions. She incorporates the learnings from three
SPE Talent Council surveys, a Society of Exploration Geo-
physicists survey, and other research studies, and conversa-
tions about the issues with management and with members of
dual-career couples.

The SPE Balcones Section recently held

a technical session on the “Current State
of the Energy Industry,” which included
a presentation by guest speaker Mark
Papa, a partner at Riverstone Holdings
and former chief executive officer of
EOG. The session attracted 108 people.
Pictured from left to right: Chris Cantrell,
membership chair; Elizabeth Cantrell,
section chairman; William Locklear, SPE
Legion of Honor member; Papa; Chad
Burkhardt, scholarship chair; Justin Stool,
program chair; and Kyle Dahlberg, Young
Professionals coordinator.

SPE EVENTS
WORKSHOPS CONFERENCES SYMPOSIUMS

19–21 July ◗ Colorado Springs—SPE
Distributed Fiber-Optic Sensing
for Wells, Reservoir, and Facilities
Management
25–27 July ◗ Bangkok—SPE Artificial Lift
Systems for Optimised Production
15–18 August ◗ Kuala Lumpur—SPE
Reserves, Resources, and Definition
20–21 September ◗ Calgary—SPE Caprock
Integrity for Thermal Applications
6–7 October ◗ Mumbai—SPE Deepwater:
The India Opportunity—Innovate,
Collaborate, Accelerate
10–13 October ◗ Kuala Lumpur—SPE
Reservoir Surveillance & Production
Enhancement Through Cost-Effective
Technology Integration and Operation
Efficiency
11–12 October ◗ Doha—SPE Reservoir
Characterisation
17–18 October ◗ Houston—SPE Deepwater
Asset Integrity and Field Life Extension
1–3 August ◗ San Antonio—SPE/AAPG/ 13–15 September ◗ Canton—SPE Eastern
SEG Unconventional Resources Technology Regional Meeting
Conference 29 November–1 December ◗ Banff—SPE
2–4 August ◗ Lagos—SPE Nigeria Annual Thermal Well Integrity and Design
International Conference and Exhibition
22–24 August ◗ Singapore—IADC/
SPE Asia Pacific Drilling Technology
CALL FOR PAPERS
Conference and Exhibition SPE/ICoTA Coiled Tubing and Well
24–26 August ◗ Beijing—SPE Asia Pacific Intervention Conference and Exhibition
Hydraulic Fracturing Conference ◗ Houston
6–8 September ◗ Aberdeen—SPE Deadline: 27 July
Intelligent Energy Conference SPE Hydraulic Fracturing Technology
14–15 September ◗ Galveston—SPE Conference ◗ The Woodlands
Deepwater Drilling and Completions Deadline: 15 August
Conference SPE Canada Heavy Oil Technical
21–22 September ◗ Midland—SPE Liquids- Conference ◗ Calgary
Rich Basins Conference—North America Deadline: 19 August
SPE Canada Unconventional Resources
26–28 September ◗ Dubai—SPE Annual
Technical Conference and Exhibition Conference ◗ Calgary
Deadline: 19 August
18–20 October ◗ Accra—SPE African
SPE Oil and Gas India Conference and
Health, Safety, Security, Environment,
Exhibition ◗ Mumbai
and Social Responsibility Conference and
Deadline: 15 September
Exhibition

Find complete listings of upcoming SPE workshops, conferences, symposiums, and forums at www.spe.org/events.

94 JPT • JULY 2016

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JPT • JULY 2016 95

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ADVERTISERS IN THIS ISSUE JPT ADVERTISING SALES

Archer Interwell Norway AS Brett O. Morgan
Advertising Sales Representative
Page 5 Page 83
(Americas, Asia Pacific, and
South Asia—Companies A-L)
Beicip-Franlab KBC Advanced Technologies Ltd. Tel: +1.713.457.6828
Page 9 Page 45 bmorgan@spe.org

Cameron, LEUTERT Dana Griffin

Advertising Sales Manager
a Schlumberger company Page 71
(Americas, Asia Pacific, and
Cover 4 South Asia—Companies M-Z)
National Oilwell Varco Tel: +1.713.457.6857
CannSeal Page 49 dgriffin@spe.org
Page 25
NCS Multistage, LLC Jane Bailey
Advertising Sales Manager
ENGenious Cover 3
(Europe, Middle East, Russia, and Africa)
Page 19 Tel: +44 (0) 1227.266.605
Rock Flow Dynamics jbailey@spe.org
Enventure Page 7
Page 15 Craig W. Moritz
Saudi Aramco Assistant Director Americas
Sales & Exhibits
Fairmount Santrol Page 4
Tel: +1.713.457.6888
Page 23 cmoritz@spe.org
Schlumberger
FracGeo LLC Cover 2 ADDRESS CHANGE: Contact Customer Services at
Page 59 1.972.952.9393 to notify of address change or make
TAM International changes online at www.spe.org. Subscriptions are
GEODynamics Page 2 USD 15 per year (members). JPT JOURNAL OF
Page 81 PETROLEUM TECHNOLOGY (ISSN 0149-2136) is
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96 JPT • JULY 2016

 Flow Control
Technology Leadership

High-pressure large-bore BOPs in the Gulf of Mexico

Drilling Technology Sets the Standard

The only large-bore BOPs rated 20,000 psi and 25,000 psi in the field today were designed, manufactured and installed by
Cameron in the Gulf of Mexico. In addition, Cameron has the largest installed base of BOPs in the world. Today, Cameron offers
fully automated drilling technologies for onshore and offshore operations – all backed by full life cycle support, from conceptual
design to installation and commissioning.
Now, as part of Schlumberger, we look forward to extending our leadership in flow control technology.

Find out more at

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All referenced trademarks are owned by or licensed to Schlumberger. © 2016 Schlumberger. All rights reserved. CAM-1007