JPT October 1999

Frontiers of Technology
Reservoir Engineering: Primary Recovery
In 1904, Anthony Lucas, the discoverer of Spindletop, returned to Beaumont, Texas,
from a job in Mexico and was asked by a reporter to comment on Spindletops rapid
decline in production. He answered that the field had been punched too full of
holes. The cow was milked too hard, he said, and moreover she was not milked
intelligently."1
Lucas comments were lost on early oil operators, who gave little thought to reservoir
depletion and behavior as they drilled well after well in their newly discovered fields.
When natural flow played out, they simply placed their wells on pumps. When the
pumps could no longer bring up economical amounts of oil or when water production
became excessive, a reservoir was considered depleted. In the late 1920s, methods
for estimating oil reserves and the quantities that might be recoverable hadnt been
worked out. Of course, many of the pioneer oilmen knew that the gas represented
energy which, if it could be controlled, could be put to work lifting oil to the surface.
But control involved numerous problems, and everyone was more interested in
producing the oil and selling it. Regulation of drilling and production was still
nonexistent, so waste and overproduction were widespread.2 Gas associated with oil
was flared or simply released into the atmosphere.
Several years later, the U.S. federal government referred to the billions of cubic feet
of gas that had been lost and publicly deplored the practice. Remedial measures
were proposed that included cooperative production by field operators and legislation
to control producing rates and to prohibit gas waste.1 Once operators discovered the
results of their wasteful ways, they quickly initiated a series of technical studies of
reservoir behavior and the physical properties that controlled this behavior. Thus, the
profession of reservoir engineering was officially born.

The Early Years

According to most authorities, reservoir engineering officially began in the late 1920s.
At this time, engineers engaged in the recovery of petroleum began giving serious
consideration to gas-energy relationships. They recognized their need for more
precise information about hydrocarbon activity in reservoirs that they were producing.
Actually, reservoir study can be traced to an earlier beginning when, in 1856,
Frenchman H. Darcy became interested in the flow characteristics of sand filters for
water purification. This interest led him to resort to experiments which, in turn, led to
the real foundation of the quantitative theory of the flow of homogeneous fluids
through porous media. These classic experiments resulted in Darcys law.3 Since
1928, the art of forecasting the future performance of an oil and/or gas reservoir
based on probable or presumed conditions has evolved steadily. In the early 1920s,
reservoir engineering was concerned largely with empirical performance, with the
exception of the laboratory work done on fluid and rock properties. Ultimately, this
experimental work provided a foundation for the mathematical equations that were
derived later during the 1930s.
From the beginning, engineers recognized that oil-recovery methods based on
wellhead or surface data were generally misleading.4 They knew they must obtain a
more thorough understanding of the functions of the reservoir in order to maximize
the recovery of its hydrocarbons. This fact set in motion the evolution that has
resulted in todays engineered reservoir. Along the evolutionary trail leading to the
present, developments in applied mathematics, numerical analysis, computer

hardware and software, geology, geophysics, and geostatistics became part of

reservoir engineering.

Fluid Flow
Hydrocarbons are complex fluids that generally exist in an untapped reservoir in
liquid and gaseous states and are considered to be at equilibrium. Likewise, they are
expected to behave in accordance with predictable functional
pressure/volume/temperature (PVT) relationships. If all the gas is dissolved in the oil,
the single phase, is considered to be a liquid phase, and the reservoir is called a
dissolved-gas reservoir. On the other hand, if there are hydrocarbons as vaporized
gas that are recoverable as natural gas liquids on the surface, the single phase is
considered to be a gas phase, and the reservoir is called a wet-gas reservoir. In
some reservoirs, both liquid and gaseous phases may exist. These are called gascap reservoirs. If an artesian water supply is directly associated with any of these
reservoirs or expanding water is the dominant producing force, the reservoir is
termed a waterdrive reservoir.
Challenges to reservoir engineers begin when the reservoir is opened to production
and the flow of hydrocarbons begins. At this point, reservoir pressures drop; fluids
comprising gas, oil, and water expand; phase equilibria are disturbed; and alterations
in the physical properties of the fluid phases occur in various degrees throughout the
entire reservoir. In short, the oil has become active. With further withdrawal of fluids,
changes continue and difficult second-order partial-differential equations are needed
to describe the unsteady-state flow of expansible fluids.
From 1927 to 1930, Jan Versluys, a well-known hydrologist working for Royal Dutch
Shell, wrote numerous articles on the physics of oil producing formations that were
widely published. In 1931, Morris Muskat and H.G. Botset wrote several papers on
the flow of reservoir fluids. These papers and articles were instrumental in advancing
the knowledge of reservoir dynamics to its present state.
Today, most reservoir engineers consider that, of the many great reservoirengineering pioneers, Muskat probably had the greatest impact, relates Joe Warren,
a personal friend of the late Morris Muskat. A native of Riga, Latvia, Muskat attended
Marietta College and Ohio State U. and ultimately received a PhD degree in physics
from the California Inst. of Technology in 1929. Following his graduation from Cal
Tech, Muskat joined the Gulf Research and Development Co. where, at the age of
31, he wrote The Flow of Homogeneous Fluids Through Porous Media, a seminal
publication for reservoir engineering. Twelve years later, in 1949, he wrote a second
book, Physical Principles of Oil Production. Together, these books provided a sound
analytical foundation for reservoir engineering by combining fluid mechanics with
phase behavior.
Muskat also published technical papers in such diverse fields of interest as
hydrodynamics, lubrication theory, and the mechanics of shaped charges, Warren
recalls. As a matter of fact, he received an original patent for his work on the use of
shaped charges in oilwell perforating applications.
A paper written in 1933 by T.V. Moore, Ralph J. Schilthuis, and William Hurst
advanced reservoir science further. The paper presented the first equation for
unsteady-state radial flow of expansible reservoir fluids. It reported the development
of a linear second-order equation similar to the classic heat-flow equation that
adequately described the flow of a single-phase compressible (or expansible) liquid
in a reservoir. A year later, in 1934, Schilthuis and Hurst published the application of
the equation to the calculation of reservoir-pressure changes in an east Texas field
and to the prediction of the effect thereon of changes in production rates.5

Phase Relationships
In considering the drive mechanisms influencing a reservoir, a reservoir engineer
must determine the fluid phases that exist, their compositions, and the changes that
normally would take place during natural flow under the drive in order to predict the
behavior of the reservoir.
Among the first to realize the importance of fundamental studies of phase
relationships were B.H. Sage and W.N. Lacey. In the 1930s, they published a series
of papers reporting the results of their continuing research in the field of phase
behavior. Among their significant contributions was the recognition and
characterization of condensate reservoirs.6

Sampling and Measurement Devices

Early reservoir engineers recognized that both temperature and pressure influence
the behavior of reservoir fluids. Since the measurement of reservoir pressure and
temperature was basic to enabling reservoir-performance calculations, the
development of a method or device that would measure them became a priority. The
development of continuously recording instruments such as the pressure gauges
invented by P. Comins and Geophysical Research Corp. and subsurface
temperature-measuring devices developed by C.E. Van Orstrand contributed greatly
to this new science.
Likewise, early pioneers realized that, in order to calculate volumes of oil and gas in
place, they would need to know the change in the physical properties of bottomhole
samples of the reservoir fluids with pressure. Accordingly, in 1935, Schilthuis
described a sampler and a method of measuring the physical properties of
bottomhole samples.
Measurements included PVT relationships, saturation or bubble-point pressure, total
quantity of gas dissolved in the oil, quantities of gas liberated under various
conditions of temperature and pressure, and the shrinkage of the oil resulting from
the release of its dissolved gas from solution. These data made the development of
certain useful equations feasible and provided an essential correction to the
volumetric equation for calculating oil in place.7

Material-Balance Equations
In 1935, D.L. Katz of the U. of Michigan proposed a tabular method of obtaining a
material balance for a closed reservoir. Basically, a material-balance equation is a
statement that accounts for the volumes and quantities of fluids that are initially
present in, produced from, injected into, and that remain in a reservoir at any state of
its depletion.
Also, that same year, Schilthuis published a material-balance equation that included
the same terms of fluid volumes and changes with time as Katzs method. The
application of Katzs method required the experimental determination of phase
equilibria data; the Schilthuis method represented a simplification in that the requisite
terms were reduced to simpler expressions.
A bit later, Schilthuis proposed a method to calculate water encroachment using the
material-balance equation, but his method required accurate production-history data.
Several years later, William Hurst developed a method for determining the rate of
water influx that was independent of the material-balance equation and production
history; only data on pressure history and rock and fluid properties were required.8

Displacement-Efficiency Equation
In 1940, S. Buckley and M.C. Leverett proposed two displacement-efficiency
equations concerning the displacement of immiscible fluids. These equations
provided another powerful tool for reservoir engineers and scientists. One equation
describes the fraction of immiscible displacing fluid flowing with the oil through a unit
rock volume; the other describes the rate of advance of a particular degree of
saturation of the displacing fluid that exists in that volume.
These valuable equations are used in the calculation of recovery by an immiscible
displacing fluid, natural or induced. And they played a key role in allowing later
engineered waterflood predictions. Applications include prediction of the effects of
relative viscosity or permeability, volumetric rate, formation dip, differential fluid
density, and wetting and pressure gradient on recovery under specified conditions.9

Maximum Efficient Rate of Production

Through the years, it has been learned that oil is recovered by three different natural
mechanismssolution-gas drive, gas-cap drive, and waterdrive. These mechanisms
may be effective individually or in combination. They differ in recovery efficiency.
Recovery can be increased by controlling the reservoir so that the most efficient
available mechanism becomes the dominant one or by injecting gas or water to
supplement or modify the natural drive.
In practice, one of the most effective means of achieving efficient recovery is through
control of the rate of production of oil, water, and gas. The knowledge gained through
studies of reservoir behavior led to the concept of maximum efficient rate of
production. For each particular reservoir, it is the rate that, if exceeded, would lead to
avoidable underground waste through loss of ultimate oil recovery. This concept has
found widespread application by both industry and regulatory bodies for the efficient
recovery of petroleum.10

Reservoir Simulation
By the 1950s, most of the fundamentals of modern reservoir engineering were in
place. The next evolutionary milestone was the emergence of reservoir simulation.
The earliest simulators (circa 1930) were essentially sandboxes constructed with
transparent glass sides. These elementary simulators allowed researchers to view
fluid flow directly. During this era, most reservoir scientists assumed that the reservoir
was a single tank or cell in which the fluid flowed from one side to the other.
These early modeling attempts were used to study water coning, states Donald
Peaceman, a retired Exxon researcher and industry consultant. The models allowed
researchers to see the activity that occurs when a well is produced. The production of
the oil causes the pressure around the well to decrease, and that causes the water to
cone up and be produced with the oil.
It wasnt until the 1930s that people in the oil industry started looking at reservoir
mechanics in any kind of a scientific way, he continues. So this was one of the first
attempts to understand why water starts to be produced with the oil and why the
produced-water/oil ratio increases with time.
Twenty years later, with the advent of computers, reservoir modeling advanced from
sandboxes and electrical analogs to numerical simulators. In numerical simulation,
the reservoir is represented by a series of interconnected blocks, and the flow
between blocks is solved numerically. Early computers were small and had little
memory, which limited the number of blocks that could be used.

When I went to work in 1951, recalls Peaceman, we had nothing that you could call
a computer. We did have access to some accounting machines that the accounting
department would let us use, but only at night, he remembers. Our job was to
model the flow of gas through the porous rock of a field. To accomplish this, we had
to use a converted accounting machine that had a capacious memory of 56 words of
eight decimal digits each, could not store a program, and strained to complete five
floating-point operations per second, says Peaceman as though he still finds it hard
to believe.
Our management did have the vision to see that digital computation was going to be
the way to do reservoir modeling in the future, but that vision was still pretty faint, he
remembers.
In 1955 we significantly increased our computing capacity when we acquired a
Bendix G-15, explains Peaceman, as he recalls his past experiences involving the
evolution of reservoir-simulation computers. This [computer] had vacuum-tube
electronics, but its storage was almost completely on a magnetic drum. Within the
next few years, we obtained IBMs first widely used scientific computer, the 704. It
was a binary machine, with built-in floating-point hardware. Its central memory was
magnetic core, and its secondary storage was magnetic tape, he continues. Also,
Fortran was not yet available. Our programs were written in assembly language, but
that didnt bother us, since we were already used to dealing with machines that were
much less user friendly.
During the following decades, computing power increased, which, in turn, allowed
engineers to create bigger, more geologically realistic models that required greater
data input. This demand was met by the creation of increasingly complex and
efficient simulation programs with easy-to-use data preparation and results-analysis
packages.
Over the years, numerical simulation has continued to evolve to the point that it has
become a reservoir-management tool for all stages of the life of the reservoir. No
longer is it used only for comparing the performance of reservoirs under different
production schemes or for troubleshooting failed recovery methods. Today, they plan
field development, design measurement campaigns, and guide investment decisionmaking.11

Reservoir Management
Webster defines management as the judicious use of means to accomplish an end.
Thus, reservoir management can be interpreted as the judicious use of various
means available in order to maximize the benefits from a reservoir. According to
several authors who have written on reservoir-management practices, reservoir
management involves making certain choices: either let it happen or make it happen.
Without planning, they say, the generation of benefits from a reservoir operation is
left to chance.12 With sound management practices, they conclude, the generation of
benefits is enhanced, and chances of profit are maximized.
In 1963, John C. Calhoun Jr., in an article written for the JPT, described the
engineering system of concern to the petroleum engineer as being composed of
three principal subsystems.
1. Creation and operation of wells.
2. Surface processing of the fluids.
3. Fluids and their behavior within the reservoir.
The first two depend on the third because the type of fluids (oil, gas, and water) and
their behavior in the reservoir will dictate where and how many wells to drill and how

they should be produced and processed to maximize profits, states Calhoun.13

Technically, reservoirs have been managed for more than a 100 years, but true
reservoir management has been practiced only when a major expenditure is planned,
such as original field development or waterflood installation. In fact, until 1970, most
people considered reservoir management as synonymous with reservoir
engineering.14 However, during the past three decades, its integration with other
sciences, such as geology, has created a truer reservoir-management approach.
During its evolution from purely reservoir engineering to the more integrated
reservoir-management function, the science of forecasting the future performance of
an oil or gas reservoir went through two distinct periods.
In the first period --- the four decades before 1970 --- reservoir engineering was
considered the only item of technical importance in managing a hydrocarbon
reservoir. In 1962, Wyllie emphasized two key points --- clear thinking using
fundamental reservoir-mechanics concepts and automation using basic computers.15
In the second period --- the three decades since 1970 --- the concept of managing oil
and gas reservoirs has evolved more toward the integration of reservoir engineering
with other scientific disciplines, namely geology and geophysics.
Craig emphasized the value of detailed reservoir description using geological,
geophysical, and reservoir-simulation concepts.16 He challenged explorationists, with
their knowledge of geophysical tools, to provide a more accurate reservoir
description that could be used in engineering calculations.
In the last 10 years, it has become clear that reservoir management is not
synonymous with reservoir engineering and/or reservoir geology. Instead, it is a
blending of these disciplines into a team effort. Projects undertaken during the past
10 to 15 years have seen the integration of efforts into multidisciplinary project teams
that work together to ensure development and execution of the reservoirmanagement plan.

The Future
The science of reservoir engineering will continue to evolve; newer and better
methods of predicting reservoir behavior will be found. However, when it comes to
reservoir management, true integration of the geosciences into reservoir engineering
will take time because the disciplines do not communicate well. Simply recognizing
that integration is beneficial will not be sufficient. True integration will require
persistence.17
And, while a comprehensive program for reservoir management is desirable, every
reservoir may not warrant a detailed program because it might not be cost-effective.
In these cases, reservoir engineering alone may be sufficient.

References
1.

Reistle, C.E. Jr.: Chapter 12: Reservoir Engineering, History of Petroleum

Engineering, API, New York City (1961) 816.

2.

The Production Research Divisions 30 Years with Humble, Humble Oil and
Refining Company, Houston (1959) 11.

3.

Muskat, M.: The Flow of Homogeneous Fluids Through Porous Media,

McGraw-Hill Book Co. Inc., New York City (1937) 55.

4.

Craft, B.C. and Hawkins, M.F.: Applied Petroleum Reservoir Engineering,

second edition, Prentice Hall, Englewood Cliffs, NJ (1991) 2.

5.

Reistle, C.E. Jr.: Chapter 12: Reservoir Engineering, History of Petroleum

Engineering, API, New York City (1961) 830.

6.

Reistle, C.E. Jr.: Chapter 12: Reservoir Engineering, History of Petroleum

Engineering, API, New York City (1961) 831.

7.

Craft, B.C. and Hawkins, M.F.: Applied Petroleum Reservoir Engineering,

second edition, Prentice Hall, Englewood Cliffs, NJ (1991) 2.

8.

Reistle, C.E. Jr.: Chapter 12: Reservoir Engineering, History of Petroleum

Engineering, API, New York City (1961) 832.

9.

Reistle, C.E. Jr.: Chapter 12: Reservoir Engineering, History of Petroleum

Engineering, API, New York City (1961) 833.

10.

The Production Research Divisions 30 Years with Humble, Humble Oil and
Refining Co., Houston (1959) 18.

11.

Adamson, G. et al.: Simulation Throughout the Life of a Reservoir, Oilfield

Review, Schlumberger Oilfield Services, Houston (Summer 1996) 16.

12.

Satter, A., Varnon, J., and Hoang, M.: Integrated Reservoir Management,
paper SPE 22350 presented at the 1992 SPE International Meeting on Petroleum
Engineering, Beijing, 2427 March, 16.

13.

Calhoun, J.C. Jr.: A Definition of Petroleum Engineering, JPT (July 1963).

14.

Thakur, G.C.: Reservoir Management: A Synergistic Approach, paper SPE

20138 presented at the 1980 SPE Permian Basin Oil and Gas Recovery
Conference, Midland, TX, 89 March.

15.

Wyllie, M.R.J.: Reservoir MechanicsStylized Myth or Potential Science?

JPT (June 1962) 583.

16.

Craig, F.F. et al.: Optimized Recovery Through Continuing Interdisciplinary

Cooperation, JPT (July 1977) 755.

17.

Satter, A., Varnon, J., and Hoang, M.: Integrated Reservoir Management,
paper SPE 22350 presented at the 1992 SPE International Meeting on Petroleum
Engineering, Beijing, 2427 March.