COURSE MODULE MATERIAL – LAST UPDATED 16TH JAN 2024

PETE 473 – Production Forecasting and Reserves Estimation in Hydraulic Fractured

Horizontal Well Production in Unconventional Reservoirs using CMG Software

Instructor: Clement Afagwu 1, Sulaiman Alarifi 1

1
Department of Petroleum Engineering, College of Petroleum Engineering and Geosciences (CPG), King
Fahd University of Petroleum & Minerals, KFUPM - Dhahran, 31261, Saudi Arabia.

Corresponding Authors e-mails: c.afagwu@kfupm.edu.sa; sularifi@kfupm.edu.sa

Executive summary – High development cost of shale fields produced with multi-fractured well systems
prompts for improved and faster production forecasting tools. This Reservoir simulation amongst other
methods is a reliable method for estimating EUR and reserves updates. However, faces enormous
challenge as it requires robust data for accurate prediction. Improved geologic model description also
called static model required 3D seismic at least in order to calculate the reservoir volumes by
compartments and regions separated by the stratigraphy traps and faults, rather than a box model. The
flowing fluids components properties will infer fluid types and allow for accurate reserves estimation. The
fluid interactions with the rocks in the process of transport and pre-deposition that determine the relative
permeability and wettability of the rock including the initial fluid contacts and pressure. In this lecture,
First, we will build a reservoir box model with cartesian grid and populate the layers with average
petrophysical properties and perform history matching while studying the effect of the uncertainties such
as lack of relative permeability data on matching accuracy. Finally, we will investigate the impact of
multiple wells and well spacing on the 10-year EUR forecast and deterministic reserves estimate.

Graphical abstract

Table of Content

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COURSE MODULE MATERIAL – LAST UPDATED 16TH JAN 2024

Executive Summary

Table of Content

List of Figures

List of Tables

Abbreviations

1 Introduction

1.1 Overview of Production Forecasting and Reserve estimation methods…………………………………………

1.2 Modeling with CMG Commercial Software…………………………………………………………………………………

1.3 Benefits and Application………………………………………………………………………………………………………

2 Case study…………………………………………………………………………………………………………………………………..

2.1 Problem Statement and Case Study………………………………………………………………………………………..

2.2 Project Workflow………………………………………………………………………………………………………………….

3 Building Base reservoir model………………………………………………………………………………………………..

3.1 Reservoir Description……………………………………………………………………………………………………………

3.1.1 Gridding……………………………………………………………………………………………………………………….

3.1.2 Planar Hydraulic Fractures…………………………………………………………………………………………….

3.2 PVT Component Properties……………………………………………………………………………………………………

3.3 Rock-Fluid Data……………………………………………………………………………………………………………….

3.4 Initial Conditions……………………………………………………………………………………………………………….

3.5 Well and Recurrent Data…………………………………………………………………………………………………..

4 History matching liquid rate based on ORAT……………………………………………………………………..

4.1 Effect of Relative Permeability and wettability on HM……………………………………………………

4.2 Sensitivity Analysis with CMOST-AI and Automatic HM ……………………………………………….

5 EUR Forecasts for 10 years………………………………………………………………………………………………………

5.1 Base Model with Single Horizontal Well………………………………………………………………………….

5.2 Impact of multiple horizontal well completion ………………………………………………………………..

5.3 Impact of horizontal well spacing …………………………………………………………………………………………..

1. Introduction

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1.1 Overview of Production Forecasting and Reserve estimation methods

This introduction section is a rephrased extract from my Published work cited as Afagwu C, Alafnan S,
Weijermars R, Mahmoud M. Multiscale and multiphysics production forecasts of shale gas reservoirs: New
simulation scheme based on Gaussian pressure transients. Fuel 2023;336:127142.
doi:10.1016/j.fuel.2022.127142. Note the references in the text were removed.

“Forecasting hydrocarbon production is crucial for effective asset development, guiding decisions on
optimal exploitation of hydrocarbon-bearing formations. Generally, production forecasting relies on
extrapolating existing data through time-dependent mathematical relationships in decline curve analysis
(DCA) or physics-based reservoir simulation schemes. DCA is simpler but limited to preserving the
formation's status quo, susceptible to variations from upstream operations. Reservoir simulation
demands a detailed description of rock and fluid properties within specific transport and geological
models.

Darcy's law, a primary mathematical framework connecting pressure drawdown to production rate,
initially designed for incompressible single-phase laminar flow, has been extended to multiphase flow,
real gas law effects, capillary pressure effects, and more. Despite these adaptations, its application to
shale formations encounters limitations.

The unique mass transport mechanisms governing well rates in shale formations differ from conventional
reservoir engineering simulation models. Sedimentation processes during shale formation reduce
petrophysical quality, while brittleness induced by quartz leads to natural fractures. Organic matter adds
complexity, as hydrocarbon accumulation is self-sourced, with gas trapped in nano- and micropores
associated with organic matter. Kerogen, an insoluble organic compound in shale, has micropores hosting
hydrocarbons in the sorbed phase.

Solving complex engineering mathematical relationships for reservoir simulation involves discretizing
equations over space and time, considering geological heterogeneity and fluid thermodynamic properties.
While established software packages like Eclipse, Intersect, tNavigator, Nexus, Petrel, and CMG facilitate
simulation in conventional reservoirs, their accuracy is impacted in shale reservoirs due to their
unconventional, ultra-low permeability nature. Researchers have refined existing tools to address this
knowledge gap, focusing on fluid transport near natural and hydraulic fractures to generate type curves
for various production scenarios.”

In this example, we will be utilizing CMG commercial software to simulate flow in hydraulic fractured
unconventional reservoirs using the dataset in a soon to be published article with Arabian Journal of
Science and Engineering. Going forward, a brief description of tool kits in CMG for reservoir simulation in
black oil, condensate and multiphase flow, fluid modeling, uncertainty analysis and dynamic history
matching and results visualization will be explained.

1.2 Modeling with CMG Commercial Software

IMEX, GEM and STARS are three main simulators in CMG 2020. IMEX stands out as one of the world's
fastest conventional reservoir simulator module (Fig. 1), specializing in modeling intricate, heterogeneous,
faulted oil and gas reservoirs to deliver swift and accurate predictions and forecasts. Reservoir engineers

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leverage IMEX to transition seamlessly from history-matched primary production and water floods to
enhanced recovery processes in GEM and STARS.

As a full-featured three-phase, four-component, black oil reservoir simulator, IMEX excels in accurately
representing complex, heterogeneous, and faulted structures. It accommodates primary and secondary
(water and polymer flooding) recovery processes, incorporating intricate features like local grid
refinement (LGR), comprehensive well management, pseudo-miscible options, horizontal wells, dual
porosity/permeability, flexible grids, and gas adsorption, among others.

IMEX models multiple PVT and equilibrium regions, accommodating various rock types and offering
flexible choices for relative permeability. Regardless of the reservoir's size or complexity, IMEX proves
effective for a wide range of reservoir management challenges.

To optimize your reservoir simulation model, IMEX is employed after history-matching, allowing engineers
to screen multiple recovery techniques and determine the best net present value (NPV). IMEX's speed
enables engineers to conduct more runs compared to other simulators.

Fig. 1. The view screen of CMG Launcher showing the three most relevant modules IMEX, GEM, STARS used for
black oil, compositional and thermal simulation respectively. See the Work directory containing simulation file.
Also showing work files of type “.DAT” Input file, “.SR3” Result file and other files.

1.2.1 Benefits and Applications

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• Attain simulation results at an accelerated pace, outperforming most conventional simulators.

• Quickly evaluate a diverse range of recovery mechanisms before advancing to more intricate
simulations.

• Precisely model matrix-fracture transfer in fractured reservoirs.

• Harness the speed of IMEX for efficient shale gas modeling.

• Integrate seamlessly with CMOST for swift, accurate history matches and uncertainty analysis,
optimizing limited engineering time.

• Facilitate a rapid and straightforward transition to enhanced oil recovery (EOR) process modeling in
GEM and STARS.

There are up to 13 Technologies or modules (Fig. 1). Fig. 2 shows an overview of the modules and the
relationship between them.

Fig. 2. Overview of the CMG Software containing a Builder pre-processor, WinProp PVT Software, three simulators
(IMEX, GEM, and STARS), CMOST for sensitivity analysis, dynamic history matching, optimization and uncertainty
analysis and the Results module.

Builder is a pre-processor that provides the graphic user interface utilize to build reservoir models with
IMEX, GEM or STARS simulator. CEDIT is an alternative platform to the graphic interface for editing .DAT
input file. CMOST AI for Sensitivity analysis, Dynamic history matching, Optimization and Uncertainty
analysis (Fig. 2) by integrating machine learning and reservoir simulation. WINPROP to build fluid
composition model that could be imported in the builder using any of the three simulators. There are
numerous applications like Primary and secondary recovery mechanisms simulation can be performed by
the IMEX black oil simulator, as summarized in Table 1.

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Table 1: Some of the practical oil and gas applications of the CMG IMEX modules. The area of interest in this
lecture is bold in black.

• Unconventional gas & Liquids • Secondary recovery

reservoir like:
• Waterflooding
✓ Coal Bed Methane (CBM)
• Surface facilities modeling
✓ Shale gas
• Polymer injection
✓ Shale liquids
• Dry gas injection
✓ Tight gas
• Pseudo-miscible solvent injection
• Primary depletion
• WAG processes
• Infill drilling optimization
• Gas storage fields
• Horizontal & multi-lateral well placement
• Cycle optimization
• Coning studies
• Naturally or hydraulically fractured
• Under-saturated/saturated oil reservoirs
reservoirs
• Gas condensate reservoirs
• Naturally fractured reservoirs
• Gas deliverability forecasting
• Gas-oil gravity drainage
• Reservoir/surface facility optimization

Meanwhile GEM or STARS can be utilized for tertiary recovery mechanism simulation studies. CO2
enhanced oil recovery, low salinity water flooding and CO2 sequestration modeling in depleted oil and
gas reservoirs or saline aquifer can be performed with GEM Compositional simulator. STARS, which the
thermal stimulator is very common in steam injection studies or heavy oil production in oil sands popular
in Canada. Results module is a post-processor for viewing graphical solution, saturation maps etc after
running simulation and generating .SRF file.

2. Case study - Hydraulic fractured unconventional reservoir