Data Analytics 3

Regression
Regression is a method for prediction of a response variable from one
explanatory variable or by combining multiple explanatory variables.
While regression methods appear to be simple, they have many pitfalls for
the unwary. First, regression should be used for predicting an
undersampled variable by another variable or several other variables that
have more sample data.
The main types of regressiong are; the bivariate linear regression and its
variations, along with a nonlinear regression commonly used in geoscience
data analysis and multivariate linear regression (MLR); MLR is useful
in big data analytics because of its capability of combining many input
variables to predict the output or calibrate them to the target variable.
In a bivariate linear regression (or simple linear regression), one
explanatory variable is utilized in the linear function to estimate the
response variable, such as
𝑌 ∗ = 𝑎 + 𝑏𝑋
where 𝑌 ∗ is the estimator of the unknown truth Y, X is the predictor
variable, a is a constant (intercept), and b is the regression coefficient
(slope of the linear equation).
Multivariate linear regression uses many predictor variables for estimating
the response variable. It uses the following linear equation:
𝑌 ∗ = 𝑏0 + 𝑏1 𝑋1 + 𝑏2 𝑋2 . . . +𝑏𝑛 𝑋𝑛
where 𝑌 ∗ is the estimator of the response variable Y, 𝑋1 through 𝑋𝑛 are
predictor variables, 𝑏0 is a constant, and 𝑏1 through 𝑏𝑛 are unstandardized
regression coefficients for the explanatory variables.

Fig. 3.1 Observed (y) and estimated (y*) data

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Net Pay Cutoffs
When examining net pay cutoffs, it is important to differentiate among
gross rock volume, net sand volume, net reservoir volume, and net pay. For
example, the concept of net pay is used in reserves determination, but the
concept of net reservoir should be used in flow simulation analysis.
Reservoir simulators usually require gross pay with appropriate gross-to
net pay multipliers so that fluid contacts and vertical gradients are modeled
correctly. Hence, the appropriate cutoffs depend on the application. In
practice, cutoffs are applied to well logs or cores, and we therefore examine
thickness (pay) rather than volume. Figure 3.2 shows four categories of
rock: gross pay, net sand, net reservoir, and net pay. Gross pay comprises
all rocks within the evaluation interval, that is, the thickness between the
top and bottom of the zone(s) of interest. In sandstone reservoirs, the
inflection point of the SP curve or the GR curve inflection points are used
to identify the boundaries. In carbonates, porosity cutoffs are used to define
the lithological tops and bottoms. Depending on the application, gross pay
may be set as the thickness of the reservoir or the hydrocarbon interval.
Gross pay can include low permeability intervals, shaly intervals, and
water-saturated intervals through which hydrocarbon fluid will not flow.
Net sand is those rocks that might have useful reservoir properties. Net
reservoir is those sand intervals that do have useful reservoir properties.
Net pay comprises those intervals that do contain movable hydrocarbons.
Gaynor and Sneider (1993) define net pay as “the hydrocarbon bearing
volume of the reservoir that would produce at economic rates using a given
production method”.
There are two general considerations controlling net pay:
• Does the rock have sufficient permeability to produce oil or gas at
economic rates?
• Does the rock contain movable oil volumes (fluid saturation)?

Fig. 3.2 Sequential application of cutoffs to define different classes of reservoir rock.
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There are typically three factors that differentiate gross pay, net sand, net
reservoir, and net pay: shale volume (Vshale), porosity, and saturation. The
first two criteria address whether or not the rock has sufficient
permeability. The last criteria addresses whether or not the rock has
sufficient hydrocarbons.

Factors Controlling Net Pay Criteria

A common definition of net pay is the thickness of that part of the
hydrocarbon-bearing zone of the reservoir that is capable of producing at
economic rates using a given production method. However, economic rate
is an imprecise concept. Recall Darcy’s law for pseudo steady-state radial
inflow:
𝑘𝑒𝑓𝑓 𝑃𝑟 − 𝑃𝑤𝑓
𝑞∝
𝜇 0.472 𝑙𝑛 { 𝑟𝑒 } + 𝑆
𝑟𝑤
Darcy’s law illustrates that the rate at which a well flows depends on the
effective permeability (and therefore on the oil, gas, and water saturation
and the overburden pressure), the reservoir fluid viscosity, the pay
thickness, the drainage radius, type of completion, drive mechanism, and
the pressure drawdown. In some reservoirs, tight rock can flow into more
permeable rock, and thus reservoir heterogeneity and flow path tortuosity
become factors. The economics of that rate depend on operating costs and
the price of oil and gas. Hence, there are many factors involved in
determining net pay including:
• Oil or gas prices;
• Completion or well design (horizontal versus vertical well,
hydraulically fractured versus nonstimulated well);
• Reservoir heterogeneity and its distribution;
• Total pay thickness;
• Effective vertical thickness and flow path tortousity;
• Drive mechanism;
• Mobility ratio;
• Oil viscosity;
• Lateral continuity of interval for injection processes;
• Amount and quality of data.

Rules of Thumb for Net Pay

Most rules of thumb for pay cutoffs are built on three considerations. First,
does the rock have enough permeability? Second, does the rock have
sufficient movable hydrocarbon pore volume to yield oil or gas at
economic rates? Third, does that volume of rock contain sufficient
permeability to flow substantial volumes of hydrocarbon relative to other
rocks in the reservoir (relative processing or drainage)?
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Probably the most common cutoffs are permeability cutoffs, with typical
values of:

𝑘𝑒𝑓𝑓 > 0.5 𝑡𝑜 1.0 𝑚𝐷 for oil reservoirs

𝑘𝑒𝑓𝑓 > 0.1 𝑡𝑜 0.5 𝑚𝐷 for conventional gas reservoirs
𝑘𝑒𝑓𝑓 > 0.001 𝑡𝑜 0.000 001 𝑚𝐷 for tight gas with horizontal multifrac
wells

in which the pay that has a permeability exceeding the cutoff is considered
to be net pay. It is less common, but likely more accurate to include the
viscosity as follows:
𝑘𝑒𝑓𝑓 /𝜇 = 𝑚 > 1.0 𝑚𝐷/𝑐𝑝 for oil or gas reservoirs
in which m is the in situ fluid viscosity.

Usually, cutoffs are applied using openhole logs. Cutoff values for
porosity, water saturation, and shale content are required. The porosity
cutoff can be determined from a given permeability cutoff using a porosity-
permeability cross plot. If a cross plot is not available, the following rules
of thumb can be used:

∅ > 1 − 3% for gas-bearing carbonates;

∅ > 2 − 4% for oil-bearing carbonates;
∅ > 5 − 8% for gas-bearing sandstones;
∅ > 7 − 10% for oil-bearing sandstones;
∅ > 26 − 28% for heavy oil-bearing sandstones.

A high-connate water saturation correlates to a lower effective

permeability. Therefore, another rule of thumb is:

𝑆𝑤 < 50%

In this case the interval must have a water saturation below the cutoff to
count as net pay.

A part of the pay zone that has the same properties as the overlying or
underlying sealing rock cannot be considered as net pay. In practice,
sandstones with high shale contents also have low effective permeability.
Hence, a shale cutoff is often applied as well as follows:

𝑉𝑠ℎ < 50%

in which 𝑉𝑠ℎ is the volume of shale in the gross pay interval.