ASSESSING SHALE GAS RESOURCE PLAYS. Energy Experts Believe Oil is Finite Demand is not.
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Transcript of ASSESSING SHALE GAS RESOURCE PLAYS. Energy Experts Believe Oil is Finite Demand is not.
ASSESSING SHALE GAS RESOURCE PLAYS
Energy Experts Believe
Oil is Finite
GLOBAL: All oil supplies, 1930-2050
0
10000
20000
30000
40000
50000
60000
70000
80000
90000
100000
1930 1940 1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050
YearT
ho
us
an
ds
of
ba
rre
ls o
f o
il p
er
da
y
OPEC OIL
NON-OPEC OIL
OIL SANDS
DEEPWATER OIL(OPEC and non-OPEC)
LIQUIDS GAPCNG, LNG, FT-GTL,
biomass, other replacement
strategies. Reduce through energy
efficiency and energy conservation?
REFINERY GAIN
Demand is not
E&P Business:Oil Price, Margin, Size & Value
high ti
de =
high
operat
ing
cost
s
low
tide
=
low o
peratin
g
cost
s
High Margin Asset
*Low Margin Asset
LowOil
Price
HighOil
Price
Global Shale Gas Volumes
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
North &South
America
Eastern &WesternEurope
FormerSovietUnion
MiddleEast &NorthAfrica
Sub-Saharan
Africa
China
Tight Gas
Coalbed Methane
Gas Shales
Source: Rogner 1997
GIP TCF
Over 32,50032,500 TCF of gas identified worldwide from Unconventional Reservoirs
Despite Early Stages of Exploration Huge Amounts of Shale Gas
is estimated in different parts of world
HC RelatedNon conventional
Resources
Oil resources Gas resources
Oil Shales Tar sandsClastic/carbonates
ReservoirsShale/coalReservoirs
Heavy oil
Tight Gas
Basin Centered Gas
Shale Gas
Coal Bed methane
LBM/CMM
Ravi Misra
Bas
in C
ente
red
gas
Tig
ht G
as
Sha
le G
as
Attractive, Hottest Business OpportunityAcross Globe
Shale Gas is key to USA Energy Basket US 2008 ytd. production of Shale Gas
is 3.23 TCF 17% of total US gas production from
Shale Gas India’s total annual Conventional Gas
production is only 26% of US Shale Gas production (Schlumberger)
Shale Gas
What is shale Gas?
Shale gas is natural gas contained within shale sequences. The gas is stored in shale in two major ways:
As adsorbed gas on kerogen (insoluble organic matter). In this respect, it is similar to natural gas from coals.
The adsorbed gas portion range between 20% (Barnett Shale) and 85% (Lewis Shale).
UTICA SHALES, NEW YORK
Continuous type regionally pervasive self contained natural gas playsContinuous type regionally pervasive self contained natural gas plays in Shale/Shaly Formations in Shale/Shaly Formations
Play Type Identification is Critical
For Assessment and Exploration
Thermogenic
Biogenic Mix Type
Gas Shales contain significant portions of both adsorbed gas and interstitial pore gas
Reservoir Reservoir Location Average (%) of Gas Content in Interstitial
Porosity
Average (%) of Gas Content Adsorbed
Lewis Shale/Siltstone San Juan Basin 75-85 15-25
Barnett Shale Ft. Worth Basin 35-75 25-65
Antrim Shale Michigan Basin 15-25 75-85
New Albany Shale Illinois Basin 25-35 65-75
White Speckled Shale Alberta 55-75 25-45
…..Contd.
NO TWO SHALES ARE ALIKE
But look for right combination of shale characteristics
SHALE TYPING IS ESSENTIAL
PLAY CHARACTERISTICS
Continuous type plays Cover large arial
extent
Large net thickness (on average)
Traits which differ from coals
*Gas Saturations Adsorbed and Free Gas*
PRINCIPAL TYPES OF GAS STORAGE PHENOMENA
• Natural Fracture Systems often Control the Success or Failure of Stimulation Attempts
• Natural Fracture Geometry can Change Laterally and Vertically with Lithology related Mechanical Properties and Stress Changes
Dual Permeability System
The Flow Path
SHALE PLAY EVALUATION
Generation Potential (source)
Storage Potential (reservoir)
Production Potential (Productivity)
The Fundamental Aspects for Evaluation
EVALUATION CRITERIA
TECHNOLOGICAL
Gas assessment related
Drilling and completion related
Stimulation and production related
COMMERCIAL & ECONOMIC
GEOSCIENTIFIC
Geological
Geochemical
Petrophysical
Reservoir
Geological Parameters
Shale Thickness (>100M)
Shale Depth (<2500M)
Areal extent Shale Type (silty) Shale brittleness
(low Poissons ratio & high Youngs Modulus)
GEOCHEMICAL EVALUATION
What makes the shale a good SOURCE for gas plays
TOC
Vro
TR
Thickness
Kerogen type
HI/O2
Biogenic-Thermogenic ratio
Multiple Methane Adsorption Isotherms, Antrim Shale Well
Organic Matter Type Effect Sapropelic Kerogens generate twice the
volume of gas as do Humic Kerogens but oil interfere with release of gas until >1.0Vro
Humic Kerogens (III) generates mainly gas starting at 0.5 Vro
Type I Kerogen starts gas generation at higher maturity than type II and Type III Kerogens
Iso Tmax plot
Iso Maturity Map
Martini 2003
Shale Gas Composition
Petrophysical
Log Motifs of producing Marcellus gas shales
Reservoir Characteristics
Type of shale- composition variability Clay volume,type Microporosity Permeability Fracture density, orientation,
connectivity Diagenetic effects (fracture fillings) Geomechanical properties Stress elements Reservoir pressures and
Temperature
Adsorbed gas
Free gas
15-85%
85-15%
Composite Reservoir Property Evaluation
Well Pressures
Reservoir characterization in Barnet Shale
ASSESSING PRODUCTION POTENTIAL
High resolution heterogeneity ismeasured via continuousscratching along the length ofthe core
Results provide a profileof unconfined strengthand its variability alongthe length of the core
Shale Reservoir Heterogeneity Measurement
RESERVOIR ANISOTROPY The implication of anisotropy is that material properties are different in the vertical direction (perpendicular to bedding) and horizontal direction (parallel to bedding), and that properties vary strongly with orientation to bedding.
Anisotropic properties can be obtained via laboratory
testing (core scale) and 3D seismic (reservoir scale)
Reservoir Anisotropy
1 cm1 cm
CalciteCalciteCalciteCalcite
Humble No. 43 Yarborough & Allen, Ward County, Texas, Section 66, E. J. Brady SurveyHumble No. 43 Yarborough & Allen, Ward County, Texas, Section 66, E. J. Brady SurveyComer (1991) location C2, sample C2-5Comer (1991) location C2, sample C2-5
Humble No. 43 Yarborough & Allen, Ward County, Texas, Section 66, E. J. Brady SurveyHumble No. 43 Yarborough & Allen, Ward County, Texas, Section 66, E. J. Brady SurveyComer (1991) location C2, sample C2-5Comer (1991) location C2, sample C2-5
0.2 mm0.2 mm
Fractured Woodford, Permian BasinFractured Woodford, Permian Basin
10.1 % TOC0.55 % Ro
Type II Kerogen
10.1 % TOC0.55 % Ro
Type II Kerogen
7175 ft7175 ft
TECHNOLOGICAL & ENGINEERING ISSUES
DRILLING COMPLETION STIMULATION FRACTURING PROPPANTS
Pinnate Drilling PatternAfter, Doug Wight, NAPE 2005
Fishbone Drilling Pattern
A StandardShale GasWellConstruction
Typical Completions Vertical wells Horizontal wells
Surface
Woodford
Lower Barnett
Upper Barnett
Surface
Barnett
Minimum horizontal stress
Vertical Stress
Maximum horizontal stress
A Multistage Completion Design
Completion Objectives
Create complex fractures that will feed a main fracture connected to the wellbore
Minimize the near wellbore tortuosity to reduce chance for screen-out
Create a conductive path to allow flow of stimulation fluids as well as reservoir fluids
Main Fracture
Branch Fractures
Fracture orientation & well placement
Well Spacing in Different Shale Plays
Fluid Compatibility w/ Shales
Some shales sensitive to fresh water and/or extreme pH environments
Lab testing recommended for fluid compatibilities
CST tests can be performed quickly
Shale pack test provide more data but more time intensive
Sensitivity of clay control additives with a shale core sample
**Compatibility Testing is a Critical Step**
Fractures in Shale
Initial Shale Stimulations
Large volume of water(80,000barrels)
Small volume of propping agent
High pump rate with low proppant concentrations
Attempt to stimulate multiple perf clusters at one time
Other Considerations
High viscous gels may create bi-winged fractures
High initial pressure may be due to damage near wellbore
Cement / mud in fractures Small volume of acid can
help overcome damage Microsiesmic helps in
monitoring the stimulation pattern
Shale Well
Shale Types & Fracture Types
Improvement in Shale Reservoir Characteristics after Treatment
Increasing Frequency of Frac Jobs
Selecting Prop pants
Embediments
crushing
Monitoring Stimulation Job Effectivity
A typical Hydrofrac Operation For Shale Gas Stimulation Job
Type of well & completion impacts on production
Shale Gas Resource Estimation
MAKING UNCONVENTIONAL GAS RESOURCE ESTIMATES IS DIFFICULT
Does not lend itself to finding-rate models Does not follow rules of field size distribution or
discovery process models Requires prudent incorporation of “technology
progress” for drilling efficiencies, well costs and reserves per well
Requires considerable data, acceptance of geologic variability, and numerous “expert judgment” calls.
Assessing the size and quality of unconventional gas is a challenge:
WHY UNCONVENTIONAL GAS RESOURCE ESTIMATES DIFFER!
Given their “continuous” nature, the size of an unconventional gas play (recoverable resource) is determined by:
(1) play area; (2) well spacing; (3) well performance; and, (4) expectations for success.
The Williams Fork (Mesaverde) tight gas play illustrates how moderate differences in assumptions can lead to widely different estimates.
U.S. Geologic Survey(2003)
Advanced ResourcesS. Basin
Only(2004)
ASSUMPTIONS
Play Area (mi2) 1,989 1,008
Developed (%) 3% 4%
Well Spacing (acres/well) 73 20
EUR/Well (Bcf) 0.91 1.21
Success/Availability Factors (%) 20% 83%
RESULTS
Recoverable Resource (Tcf) 3.1 31.3
SHALE GAS PLAY ECONOMICS
BARNETT OHIO ANTRIUMNEW ALBANY LEWIS
Depthmeter 1980-2590 610-1524 182-670 152-610
915-1828
Well cost(Rs. Crores) 2-2.7 0.9-1.35 0.81-1.12
0.56-0.67
1.12-1.35
Completion costs, (Rs. crores) 0.45-0.67 0.11-0.22 0.11-0.22 0.11
0.45-1.35
Well + completion cost (Rs.crores) 2.45-3.37 0.2-1.57 0.92-1.34
0.67-0.78
1.57-2.70
Well spacing, Acres 80-160 40-160 40-160 80 80-320
ECONOMICS OF DIFFERENT SHALE PLAYS IN USA
Cost profiles for shale plays: (Barnett, Fayetteville and Woodford)
Expected natural gas prices to average about $7 per MMBtu in 2007. The major shale plays show robust economics at a lower price, $6 per MMBtu.
Base Case Downside case
$6/MM Btu Henry hub
$4.5/MM Btu Henry hub
Barnett core 131% 57%
Barnett core 59% 8%
Barnett core 32% -105
Fayetteville 51% 7%
Woodford 61% 135
REFERENCES Fayetteville Gas shale evolution, Richard F.Lane,2006 Fractured shale gas potential in New York, David G. Hill,
Tracy E. Lombardi,& Jon P. Martin (2004) Custom technology makes shale resource profitable.
Glenda Wylie, Ron Hyden, Von Parkey, Bill Grieser, Rick Middaugh, Trends in unconventional gas, Oil & Gas Journal, 2007
Unconventional gas, topic #29,National petroleum council, Stephen Holditch et al, 2007
Shale gas-Focus on Marcellus Shales, 2008. Lisa Sumy, for the oil & gas accountability project, Earthworks
Dan Jarvie ,Humble geochemical studies
ACKNOWLEDGEMENT Author is indebted to Sh D. K. Pande, Director
(Expl) ONGC & ONGC Management for permission and support
Author acknowledges and thanks various Cos. engaged in shale gas E&P business and providing the necessary data in public domain which made it possible to comprehend and effectively communicate to the distinguished audience which will go a long way in popularizing shale gas in India.
THANKS