INGEPET VII International Seminar

Trends in the Oil Industry: New Frontiers and Unconventional Resources

Life Cycle Approach To Unconventional

Resource Development: Technology and
Practical Application
Usman Ahmed
VP, Baker Hughes
usman.ahmed@bakerhughes.com

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 Can we transplant lessons learnt from
North America to aid in the development
of unconventional Resources in the rest
of the world ?

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The Short answer is “yes” with some caveats
The Caveats
• Cost of drilling and completion
• Access to drill sites / pad drilling potential
• The hydrocarbon transportation
infrastructure
•Environmental constraints
• Commitment to technology to avoid wrong
placement of wells and hydraulic fracture
stages
• Availability of services and equipment
3 © 2010 Baker Hughes Incorporated. All Rights Reserved.
 Outline of Presentation
Unconventional Unconventional Associated Life Cycle Approach Way Forward
Resources Resource Base Challenges To Development

Shale Resource

Coal Bed Methane

Tight Oil and Gas

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Unconventional Gas Resource Triangle
Small Volumes
Easy to develop
1000 mD High
Conv
Gas
100 mD Medium

Tight 0.1 mD
Gas Coalbed Low
Large Volumes Shale Methane
Oil 0.01 mD
Difficult to develop
Shale Gas
Gas Hydrates

GasResourceTriangle

• Small Volumes and Easy to Develop (Conventional)

• Large Volumes and Difficult to Develop (Unconventional)
• Improved Technology Required to Develop and Recover
Tight Gas, CBM, Shale Gas
• Resource Triangle Concept applies to every HC-producing
Basin in the World
Source: U. Ahmed Modified (2011) after S.A. Holditch, from Masters (1979)
© 2009 Baker Hughes Incorporated. All Rights Reserved.
Natural Gas Pipeline Network in U.S.
 Shale Reservoir Development in Two Words:
Horizontal and Fracturing!!
Geo-steered
Rich gas
Wet gas lateral 12+
(NGL)
well fracs dry gas

Ro 1.0

Ro 2.0

Ro 3.0

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 Global Gas Resources

5,767
1,278
2,015
9,162 6,669
5,560
1,050

1,220 795
8,197
2,556
Over 44,300 TCF
Gas in place resource
Source: Baker Hughes, EIA, SPE 68755, Kawata & Fujita from Rogner

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Estimated Shale Gas Technically Recoverable Resources
EIA 2011
Shale TRR, Tcf

862 - #2. US
EIA World Shale Gas Resources
1,275 - #1. China An Initial Assessment of 14
Regions Outside the US,
17 Feb 2011
• Excluded from Study:
- Middle East (990*)
- Former Soviet Union (627*)
- Pacific & AP (2,625*)
- Shale Oil, CBM, Tight Gas
* “GIP” from Rogner - 1996
774 - #3. Argentina

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Technology and Production

Small energized fracs

Cross link MHF

First Horiz well

m-seismic
SWF
 Baker Hughes Asset Life Approach
to Shale Reservoirs

• Choices made in every

phase of the life cycle
Exploration
affect ultimate recovery
• Not all shale reservoirs
are the same and may
require different
choices

Rejuvenation Appraisal
Production

Development
TOC (Total Organic Content) Vs. Acoustic Impedance

Source: AAPG Explorer. Dec 2009

21 © 2010 Baker Hughes Incorporated. All Rights Reserved.
 Understanding the Reservoir
Image Data
Common Drawbacks: Optimized Stimulation
Incomplete or Incorrect reservoir understanding
Under-utilization or Misuse of modern technology

Exploiting
Natural Fractures
The Integrated Study
3-D RockView
Approach Geomechanics

• 3D GeoMechanics
• Geochemistry
• Rock mechanics
• Natural Fractures
Core
• Microseismic Microseismic
• Optimized Completion
• Effective Stimulation
• Numerical Modeling

23 © 2010 Baker Hughes Incorporated. All Rights Reserved.

 The geochemical FLEX tool delivers
elemental yields

Capture Inelastic Natural

Element Spectrum Spectrum Spectrum
Aluminum Al
Calcium Ca Ca
Carbon C
Chlorine Cl
Hydrogen H
Iron Fe Fe
Magnesium Mg Mg
Oxygen O
Potassium K K K
Silicon Si Si
Sulfur S S
Thorium Th
Titanium Ti Ti
Uranium U
Sodium Na

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Strong mineralogy variations
Montney Haynesville Eagle Ford Marcellus Barnett

© 2009 Baker Hughes Incorporated. All Rights Reserved.

Discrete Fracture Network (DFN}

Photo -Jon Olsen

 From Natural Shale to the Artificial Reservoir

Logs and core In situ stress Microseismic Re-processing

determination

Natural
Fracture
Permeability
Analysis

Benefits
• Enhancing reservoir understanding
• Exploiting modern technology

Confidential
 Shale Model Description
NATURAL

– Dual Permeability INDUCED

– Fracture MAJOR
– Anisotropy Proppant
placement
Natural fractures

Stimulated
Matrix Rock Volume
(SRV)

INDUCED
NATURAL MINOR

– Non-Darcy flow
– Gas Desorption
28
Confidential
 Modeling Approach
Shale Gas Reservoir
• Model Attributes Pressure (psi) 2020-06-01 K layer: 5

– Flow
2,000 tied to3,000
geomechanics
4,000 through
5,000 6,000

dilation-compaction tables
– Compositional formulation

0
– Gas desorption
– Non-Darcy matrix flow

-1,000
-2,000
A. Fracture propagation model B. Full well model
− Models fracture propagation − Models long term production
− Fine grid (models Minutes) − Coarse grid (models Decades)
-3,000

− Stimulation and backflow timeframe − Uses SRV attributes from model A

0.00 645.00 1290.00

− Matches frac and microseismic − Adjusts frac stage contribution to PLT

surveillance measurements
2,000 3,000 4,000 5,000 6,000

− Outputs stimulated rock volume (SRV) − Adjusted to historical production rates

permeability and pressures
− Provides Long production forecast
Confidential
 Shale Engineering Predictive Model
Matched production history and production logging

 Frac stage contribution

match
 Proppant placement match
Pressure Drop, psi
 Well History match

Narrow Uncertainty

Confidential
Horizontal Wellbores End Member Fracture Geometries

sh,max sh,min

sh,min sh,max

Transverse Longitudinal
Extend and orientation of fractures created

This type of information allows

engineers to optimize the fracturing
staging and to optimize the
placement of additional wells.
Transverse Fracture Interference
Bakken - Transverse Frac Production
History Match No Tail-In
Tail in

Perm., k, (nD) 583 478

Capacity, kh (mD-ft) 0.094 0.077

Diffusivity (mD- 4000 3300

psi/cp)

Propped Length (ft) 320 363

Conductivity, (mD-ft) 3.77 2.82

Dim. Conductivity 20.2 16.3

Choked Skin 0.096 0.067

Number Equiv. Fracs 6 6

 Relating stage contributions to production:
Impact on Field Development Plan

Events 9 8 7 6 5 4 3 2 1

Natural
fractures

B-values - 0.98 - 1.01 - 1.92 2.27 1.92 -

30
25
20
15
10
5
0
9 8 7 6 5 4 3 2 1

Rates measured by PLT 5 months later

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