Experiences in the Development of Shale Gas

Experiences in the Development of Shale Gas

Presentation Outline General background: Unconventional gas plays

in the US SLB’s general evaluation workflow

Data Audits and Initial Design Pilot Well Strategy Confirmation and Development Options Optimization and Maintenance Exploitation

Conclusions

Unconventional Gas Conference & ExhibitionStephen A. HolditchSeptember 30, 2008

Influence of Prices and Technology

Unconventional Gas Conference & ExhibitionStephen A. HolditchSeptember 30, 2008

Influence of Prices and Technology

Unconventional Gas Conference & ExhibitionStephen A. HolditchSeptember 30, 2008

Influence of Prices and Technology

Barnett Shale:Production Growth Model(Entire Industry)

511799 901 864

1069

1571

22002600 2600

8657

0

1

2

3

4

5

6

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

To

tal

Ind

us

try W

et

Gas

BC

FD

Annual Activity Level (Wells per Year)

Annual Performance Level (2005 & 2006 = 100)105 110 80859085

Bar

nett

Shal

e Pr

oduc

tion

(BC

FD) &

Wel

l Cou

nt

5

4

6

3

2

1

0

Yearly well count

Number of wells

Barnett Shale Gas Production Growth

SEECOS’ Fayetteville Shale Gas Production Growth

Fayetteville Shale Gas Production Growth

Experiences in the Development of Shale Gas

Presentation Outline General background: Unconventional gas plays

in the US SLB’s general evaluation workflow

Data Audits and Initial Design Pilot Well Strategy Confirmation and Development Options Optimization and Maintenance Exploitation

Conclusions

Tight Shale Work-Flow

Data Audit/M&A Support Review

Reservoir Model Migrated into Petrel

First Pilot Well to Evaluate Shale and Geol Confirmation

Second well-offset to prove commerciality and development strategy

Update model and tune Cluster systems from old wells

Optimization of well placement and completions Exploitation

External data collected and considered for analysis. Must have core or cuttings for TRA and basic Cluster normalization.Identify play as viableIdentify critical data gaps to be filled in initial well(s).

Bring all data into Petrel and begin reservoir model

1st new well is a data rich well designed around filling gaps in data audit and employing the key technologies to prove commercial viability and completion design

Prove repeatability and completion concept and performance

OR

React and re-design and treat as 1st well.

Build up Petrel model and design seismic survey for Ant Tracking correlation for field development strategy.Develop initial stress model and resulting model post 1st stage development for optimum infill drilling and re-frac stage

Spot check with side wall cores

Test tandem well stimulation approach

Monitor with microseismics

Spot check resulting stress and anisotropy changes from development and plan re-frac sequence..

We love models…

Models allow us to take a solution and apply it everywhere.

Or do they?

The art of models is in the application.

Ba

rne

ttB

arn

ett

Early Phase – Data Audit+

Reservoir Model Migrated into Petrel

Data Audit/M&A Support Review

External data collected and considered for analysis. Must have core or cuttings for TRA and basic Cluster normalization.Identify play as viableIdentify critical data gaps to be filled in initial well(s).

Bring all data into Petrel and begin reservoir model

Gather the available data and conduct actual lab measurements when needed to compliment the petrophysics. Where Core is not available cutting may be of sufficient quality.

• Reservoir Quality• Core to Log Integration• Shale Classification and Cluster Analysis• Identify missing data and Pilot Strategy

TRA Analysis

Initial analysis from precise sampling of core with TRA conducted to describe the heterogeneity and precise attributes.

Two Goals:1. Reservoir quality in the various units

2. Completion quality for each productive interval

Rock ≠ Rock ≠ RockRock ≠ Rock ≠ Rock

Three Layered Core-Based Shale Classification

Layer 1: Grains >4 μm

TIGHT GAS SANDS AND CONVENTIONAL

RESERVOIRS

Layer 2: Matrix

Composition

increasing silt & sand

Layer 3: Organics

SHALERESERVOIRS

argillaceous

siliceouscalcareous

Reservoirs: Thin Section Examples

Marcellus, Pennsylvania Montney, Alberta Canada

Mancos Shale, Uinta Basin Sandstone, offshore South Africa

Penn Shales, West Texas

Bakken Shale, North Dakota

Cluster analysis coupled with materials profiling allows us to evaluate log-scale heterogeneity for reservoir quality and completion optimization. You need both

Aerial View

Applications: Multiwell analysis for coring and sampling

Argillaceous (NR)

The biggest issue in tight gas reservoirs is not low permeability….It’s heterogeneity.

Nodules

Siliceous (R)

Mix. Siliceous Argillaceous (R)

Siliceous/Arg-illaceous (R)Calcareous (NR)

Problem:Reservoir quality: Where & how is gas stored?Net Value: What is the effective gas in place?Accessibility: What is the relationship between high gas concentration and containment?Production and Recovery: How discontinuous is the stress profile?How discontinuous is the pressure profile?What are the relevant discontinuities?Is the system stiff (open vs. closed fractures)?What is the variability in rock properties?What is the degree of anisotropy?Is brittleness an indication of anything fundamental?

Heterogeneity is a Key Issue

First Pilot Well(s)

First Pilot Well to Evaluate Shale and Geol Confirmation

Consider what data is in hand and the quality against the uncertainty and design the Pilot data strategy• Hole Core or infill with Side Wall (rotary)• Horizontal or Vertical Assumptions• Heterogeneity• Completion Strategy

• Do you have containment?• Are multi stages feasible?• Fluid and proppant selection

1st new well is a data rich well designed around filling gaps in data audit and employing the key technologies to prove commercial viability and completion design

Anisotropy and Fracture Containment

pVph Pv

vP

1

pVh

V

V

hph P

v

v

E

EP

1

Isotropic Blue (v)

Anisotropic Red (Eh, EV, h, V)

Note: You must have core measurements of stress in 3 axis to cover the remaining unknowns

Staging the Stimulation

Anisotropic Stress Profile

Isotropic Stress Profile

Pilot Update - Development

Update model and tune Cluster systems from old wells

Second well-offset to prove commerciality and development strategy

Prove repeatability and completion concept and performance

OR

React and re-design and treat as 1st well.

Build up Petrel model and design seismic survey for Ant Tracking correlation for field development strategy.Develop initial stress model and resulting model post 1st stage development for optimum infill drilling and re-frac stage

Continue to pilot across the play

First Pilot Well to Evaluate Shale and Geol Confirmation

A second pilot well to optimize or confirm the completion is recommended• Horizontal vs. Vertical• Completion Optimization• Update Model• Plan for periodic checks

Field Optimization• Upscale Clusters into Petrel and Seismic• Visage Coupled Stress Model• Fine tuning risks of heterogeneity• Well Placement

• Frac geometry• Simultaneous frac planning• Consider forward stress modeling

TRA Real Time Support

Core to log integration allows you to tag intervals along the borehole of a non cored well with similar patterns.

Log data can be transmitted to town as you identify dissimilar patterns you can quickly take a sample in real time to insure a proper evaluation of the units on the subject well.

A rotary sidewall coring tool is used and the sample is returned to the lab for analysis

Basin-scale 3D Visualization (Petrel Models )

Compílanse

GrossThickness

Completion Options

SPE 119635SPE 110562

Fiber Diversion Technology“StimMore”

Asset Optimization

Exploitation

Optimization of well placement and completions

Spot check with side wall cores

Test tandem well stimulation approach

Monitor with microseismics

Spot check resulting stress and anisotropy changes from development and plan re-frack sequence..

Plan for heterogeneous challenges and include a degree of periodic checks• Logs to confirm stress distributions and anisotropy• Cluster updates as needed• Update seismic scaling of clusters

Field Optimization• Determine if Simultaneous well treatments will bring improvements.• Monitor stress changes with Sonic Scanner and update Visage Model• Plan second stage of drilling or refrac based on the Petrel Model

Design with Stress in Mind

Figure 4SPE 119635

Conclusions

Shales are heterogeneous in both reservoir and mechanical properties. This is the most important property to understand.

The workflow presented has been proven (in part) to be most effective helping clients increasing their ultimate recovery by 50-100%. We continue to evolve this workflow as we learn from

new applied technology. Proper characterization requires data and sampling

on all prospective zones. Not all zones are good reservoir, not all high resistivities

are good reservoir. Containment zones may be hydraulic seals or they may

be zones within the shale. Worst case there is not reliable containment.

Not all zones react the same way with completion fluids.

Conclusions

Field Optimization Use core-to-logs integration (MP2) to define a

baseline for testing and also increases sampling efficiency

Establish the well placement and completion strategy with an integrated plan of the current and forward modeled stress state

Do not assume what works in one shale applies to a different one and be ready to realize this in different sections of a large shale play.

The Art of Modeling

is in the application

Ba

rne

ttB

arn

ett

Ha

yne

svill

eH

ayn

esv

ille

Wo

lfcam

pW

olfc

amp

Wo

odfo

rdW

ood

ford

Ma

rce

llus

Ma

rce

llus Ma

nco

sM

an

cos

An

trim

An

trim

Nio

bra

raN

iobr

ara

Mo

ntn

ey

Mo

ntn

ey

Wh

ite

Wh

ite

Sp

ecks

Sp

ecks

Gre

en

Riv

erG

ree

n R

iver