Field Development Challenge

Case Study: Pabloni field

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Pabloni Field Study

1. Introduction:
Good Oil Company is an upcoming exploration and production company with operations in over 3 countries and an estimated hydrocarbon reserve of 270 million barrels. The company is looking to expand its operations to the country Coronolia where an exploration and production license bid was put up in the year 2007. 3-D seismic data was acquired and provided by the government petroleum agency of coronolia as a part of offering the exploration license. Good Oil Company bid for exploration and development license for prospective reserves identified 35 km off the east coast of country Coronolia. The Good Oil Company was awarded the exploration and development contract in 2009.

2. Scenario :
As per the license agreement Good Oil Company was expected to drill at least 2 wells as a part of the exploration program in the Pabloni field. The field is located 35 km in a water depth of 40 m off the east coast of the capital city Le Monte which has a major oil and gas refinery as shown in figure 1.

Figure 1: Pabloni field location The present government in Coronolia is headed by Mr. Khymer who has been holding the presidential office for the last 20 years. However, several public uprising have occurred in the last couple of years to establish democratic government. Coronolia has a high unemployment

rate with 35% of the workforce unemployed and has limited skilled human resource specially pertaining to the oil industry. The Rebellion group is against the entry of foreign players in the upcoming petroleum sector. The group believes that the National Oil Company of Coronolia (NOCC) should develop the prospective reserves. The block allotted to Good Oil Company has drawn significant attention from other major E&P companies across the world. The 2-D seismic section in the N-S direction through the middle of the field is as shown in figure-2. One main formation has been recognized in the subsurface of the Pabloni field. Two vertical wells were drilled till date in the field to characterize the hydrocarbon potential as a part of the exploratory program.

Figure 2: Seismic section of the Pabloni field

3. Objective : As a part of the exploration and development group at the Good Oil Company, you are expected to assess the hydrocarbon potential of the field and devise a field appraisal and development program. The plan should include the following deliverables. 1. Estimate the potential hydrocarbon reserves. 2. Identify and characterize the structural features and drive mechanism 3. Suggest the location of the future wells for further field evaluation 4. Estimate the well flow potential. 5. Identify the type of stimulation required if any with its economic justification. 6. Develop a field development plan comparing multiple scenarios such as water injection/ Gas lift/ Stimulation/ No: of wells etc with proper economic justification (NPV, ROI, Payout time) 7. The plan should also consider the geo-political-social scenario of the region.

Rules:
Team: The number of team members should be between 3 to 5 inclusive. 1. No team should have more than 3 members from the same technical discipline 2. Screening: Preliminary workflow with summary of results needs to be submitted in the form of a 2 page document. 3. Submission: The screening document should be submitted through email at the following addresses with subject line Pabloni Study Team Name : SShukla4@slb.com (Sourabh Shukla) AAgarwal8@slb.com (Ankit Agarwal) 4. Last date of submission: 10th October 2012 5. Selected teams will be notified by date: TBD, to make a final presentation before the Judging panel on date : 25th October 2012 6. Each selected team will be allowed 12 minutes for presentation + 3 minutes for QnA.

4. Data Acquisition
The following set of data was acquired after drilling of the two wells: 1. Open Hole logs (gamma, density, porosity, resistivity etc) 2. Well test pressure and rate data 3. Wireline formation tester pressure and samples (downhole)

5. Data Set Provided (Appendix)

1. 2. 3. 4. 5. 6. 7. Contour map of Top and Bottom of the Sinox formation. Surface seismic snapshot (figure 2) Open hole log for the two wells Pressure vs. Depth Survey of the two wells Rate and Pressure vs. time from well test. Completion diagrams Cost and Economic Analysis data

Appendix

Figure 3: Contour Map of Bottom horizon (Sinox formation), Scale: 16 km * 12 km (Appendix-1)

Figure 4: Contour map of Top Horizon (Sinox formation), Scale: 16 km * 12 km (Appendix-1)

Appendix 3: Open Hole log for PA-1 and PA-2

Figure 5: Petrophysical logs of the well PA-2

Figure 6: Petrophysical logs of well PA-1

Appendix 4: Wireline Formation Tester Pressure Vs Depth Data

PA Well-2 Pressure Acquisition Formation Pressure (in psi) 3709.04 3709.34 3709.64 3709.94 3710.24 3712 3715.408 3718.816 3722.224 3725.632 3729.04 3743.808

Depth (in m) 2612 2615 2618 2621 2624 2627 2630 2633 2636 2639 2642 2655

PA Well 1 Pressure Acquisition Formation Pressure (in psi) 3744 3747.408 3750.816 3754.224 3757.632 3761.04 3764.448 3767.856 3771.264 3775.524 3779.784 3784.044 3788.304 3792.564 3796.824

Depth (in m) 2655 2658 2661 2664 2667 2670 2673 2676 2679 2682 2685 2688 2691 2694 2697

Appendix 5: Rate vs. Pressure Data from well test. Well test data for well PA-1 and PA-2 provided in the form of excel sheet. Well PA-2 was drilled towards the top of the structure. Post the testing the well was completed and hydraulic fracturing was done to assess the stimulation potential in the field. Hydraulic fracturing resulted in a fracture with a half length of almost 500 ft. Files: 1. PA-2 well test data.xls 2. PA-2 post hydraulic fracturing.xls Well PA-1 was drilled on the flank of the structure. After the petrophysical and pressure acquisition a well test was conducted to estimate the reservoir boundaries and features. Files: 1. PA-1 well test data.xls

Appendix 6: Completion diagram of the wells: PA1 and PA-2 Completion Diagram well PA-1 Completion Diagram well PA-2

3.5 Tubing 3.5 Tubing

Packer Packer

7 Production Liner

Perforation: 2655-2675 m

Perforation: 2625-2640 m

7 Production Liner

Appendix-7: Economic Analysis Data

Well Cost and Gain Cost of drilling and completing a new well Cost of converting a producer to injector Incremental STB because of pressure support from each injector/Day Cost of installing gas lift/ well Incremental STB from gas injection/Day/well Normal Oil producer well: Oil Production decline rate WRT initial production of a well rate/ year Fractured well: Oil production decline rate WRT initial production rate/ year Normal oil producer well: Oil production decline rate WRT initial production rate/ year with a 1:3 injector :producer ratio Fractured well:Oil production decline rate WRT initial production rate/ year with a 1:3 injector :producer ratio

15000000 $ 150000 $ 600 BBL 60000 $ 100 BBL 7 % 8 % 1 %

1.3 %

Field Capex Satellite Platform installation Cost (8 well slots) Production platform Installation Cost Production platform equipment cost/ bbl/day capacity Injection Platform Installation Cost Gas lift pipeline for platforms cost Field Opex Field operating cost/ year Injection water supply and operating cost/well/year Gas lift Injection cost/ well/ year Bank loan (interest rate) Fracturing Expenses/ well Personnel & Research Laboratory Support Fracturing Equipment Fluid & Additives Proppant TOTAL fracturing Cost Present Selling Price of crude

100000000 500000000 1500 250000000 150000000

$ $ $ $ $

2,500,000 1400000 1100000 15 Price (USD) 4000 2000 51000 8000 35000 100000 85

$ $ $ % $ $ $ $ $ $ $