Calgary Petroleum Club – February 19, 2013

“Production Performance Unique Type Curve for Horizontal, Multi-Stage Frac'd Gas Wells: WHY, HOW and WHEN!”

FLORIN HATEGAN

Devon Canada Corporation

PRESENTATION OVERVIEW

• INTRODUCTIONSPE 162749: HZ-MSF Production Type Curve

• Motivation: WHY?

• Simplicity: HOW?

• Timing: WHEN?

• Pre-Frac Testing Practices Review

• CONCLUSIONS

INTRODUCTION

HZ Drilling, Multi-Stage Hydraulic Fracturing:Today is the norm throughout the industryVery High Drilling & Completion costs In WCSB over 5600 HZ Wells Drilled

Over 4000 Wells for Gas and Liquid RichCost > 6 MM $$/wellEUR > 4 BcfeLow Commodity Prices Predicted

SUCCESS IS RESERVOIR SPECIFIC“ONE SIZE FITS ALL” IS NOT THE ANSWERFIELD ANALOGIES ARE DANGEREOUS

INTRODUCTION• HZ-MSF well EUR is critical!

Stimulated Reservoir Volume (SRV)Fracture Contact Area (FCA)Linear Flow SpreadsheetsDecline Curve Analysis Methods

Power Law“Modified”“Stretched”

Conventional Reservoir Engineering ModelsConsider right balance between reservoir properties and

stimulation effectiveness

INTRODUCTION• SPE 162749: HZ-MSF Production Type Curve

INTRODUCTION• SPE 162749: HZ-MSF Production Type Curve

Motivation: WHY?

(AEO2012)(1) by US EIA cut TRR by 42%

Production Performance Overestimated

Reservoir Engineering Abandoned

Well Stimulation Misrepresented

Arbitrary EUR Evaluation Techniques

Motivation: WHY? Basic Reservoir Engineering Concepts Abandoned Well Completion Effectiveness Misrepresented

Motivation: WHY?• Production Performance Overestimated

MONTNEY British Columbia 19 HZ-MSF Wells 9 + stages 1600 m HZ lateral 12 – 50 months of production

CARDIUM Alberta 21 HZ-MSF Wells 10 – 12 stages 900 – 1200 m HZ lateral 8 – 24 months of production

Motivation: WHY?• Production Performance Overestimated

MONTNEY British Columbia

kh [mDm]

20 Yrs. ∆G[Bscf]

0.080 3.65

0.040 2.56

0.016 1.60

Motivation: WHY?• Production Performance Overestimated

CARDIUM Alberta

Motivation: WHY?

• Stimulated Reservoir Volume (SRV)

Mike Mayerhofer = “Godfather” of SRVBetween 2006 – 2010 many SPE papers, articles

SPE 163833 (February 4 – 6, 2013)“Change of heart” Authors distance themselves from SRVCONCLUDE: “Reservoir permeability is the main driver…..”

Motivation: WHY?• Stimulated Reservoir Volume

(SRV)• Stimulated Reservoir Volume

(SRV)

Motivation: WHY?• Stimulated Reservoir Volume (SRV)

Motivation: WHY?• Linear Flow Spreadsheets

Motivation: WHY?

• Linear Flow Spreadsheets

Motivation: WHY?Linear Flow Spreadsheets

• Input Data

• Results

Production Type Curve

Motivation: WHY?Arbitrary Decline Curves &• HIGHER “IP” = HIGER “EUR”

Production Type Curve

Simplicity: HOW?

• Production Type Curve:Pseudo Steady State Equation

Four Parameters Initial Pressure (Pi) Matrix Permeability (km)

Wellbore Completion Skin (s’) Effective Drainage Area (A)

Simplicity: HOW?• Conventional Flow & Buildup Tests• Production Type Curve:

Pressure Permeability Skin

Gas AM-Multifrac-GeneralAnalytical General Hz Multifrac Schem atic

Xw =490.0 m

Lex =780.0 m

Yw

=16

0.0

m

Xe =980.0 m

Ye =320.0 m

Simplicity: HOW?• Modern Production Analysis• Production Type Curve:

Pressure Permeability Skin

Gas AM-Multifrac-GeneralAnalytical General Hz Multifrac Schem atic

Xw =490.0 m

Lex =780.0 m

Yw

=16

0.0

m

Xe =980.0 m

Ye =320.0 m

Simplicity: HOW?• Production Type Curve:

“Effective” Drainage Area

Simplicity: HOW?• Production Type Curve:

HZ-MSF 9 Stages (Update: 1.3 Years)

Simplicity: HOW?• Production Type Curve:

Divide HZ-MSF Total Well Production: Initial Pressure (Pseudo-Pressure) Formation Flow Capacity (km & h) Nr. of Frac Stages

Simplicity: HOW?• Production Type Curve

15 HZ-MSF Wells 4 Fields (4 to 15 Stages)

HZ-MSF Well Production Examples

Simplicity: HOW?

Timing: WHEN?

BEFORE COMMITTING TO HZ-

MSF LARGE CAPITAL!

$$$$$$

Timing: WHEN?• THINGS TO DO:

VERTICAL WELL PILOTPRE-FRAC TESTING

Reservoir PressureNet Pay & Matrix Permeability ===Drainage Area

HYDROCARBON VOLUM IN PLACE

HZ-MSF OPTIMIZATION STUDYSTART WITH PRODUCTION TYPE CURVE

Drilling & Completion CostsHZ Well LengthStage Frac Spacing & Well Spacing

VERTICAL TO HZ WELL MULTIPLIER

RUN ECONOMICSSTART HZ-MSF PROJECT

Pre-Frac Testing Review

DST TestFirst commercial DST in 1926

Wireline Formation TestIn operation 1953First RFT in 1975

DFIT TestEarly 90s

PID TestIntroduced in 2000 by BJ Services Canada

Pre-Frac Testing Review

• DST Test

Initial pressure (?) Reservoir fluid (NO) Permeability (NO)

Expensive Often miss runs happen

Questionable results very tight formations

Pre-Frac Testing Review

• WIRELINE FORMATION TESTS

Initial pressure (?) Reservoir fluid (Yes, ?) Permeability (NO)

Save rig time Poor results very tight

formations

Pre-Frac Testing Review

• INJECTION-BREAKDOWN (DFIT) TESTS

Can help frac design ISIP Breakdown Closure

Initial pressure (NO, ?) Reservoir fluid (N/A) Permeability (NO)

May work for over-pressured, permeability systems outside the scope of this presentation

Pre-Frac Testing Review• INJECTION-BREAKDOWN (DFIT) TESTS

Over-Pressured, Milidarcy Range Reservoir

Pre-Frac Testing Review• INJECTION-BREAKDOWN (DFIT) TESTS

Over-Pressured, Milidarcy Range ReservoirHZ-MSF, 550 m lateral, 8 Stages

Welltest History

Hz Multifrac Model

0

20

40

60

80

100

120

140

160

180

Rat

e (1

03S

m3 /

d)

28800

29000

29200

29400

29600

29800

30000

30200

30400

30600

Pressu

re (kPa(a))

October November December

2012

Hz Multifrac ModelSchematic

xfy =7

0.0

m

xfy =7

0.0

m

xfy =7

0.0

m

xfy =7

0.0

m

xfy =7

0.0

m

xfy =7

0.0

m

xfy =7

0.0

m

xfy =7

0.0

m

Xw =-280.0 m

Xw =-200.0 m

Xw =-120.0 m

Xw =-40.0 m

Xw =990.0 m

Xw =40.0 m

Xw =120.0 m

Xw =200.0 m

Xw =280.0 m

Lex =560.0 m

Yw =

71

0.0

m

Xe =1980.0 m

Ye =1

42

0.0

m

Pre-Frac Testing Review• INJECTION-BREAKDOWN (DFIT) TESTS

Very Tight Gas (Nano-Darcy), Vertical Well, Two Intervals

Pre-Frac Testing Review• INJECTION-BREAKDOWN (DFIT) TESTS

Very Tight Gas (Nano-Darcy), DFIT 1

Pre-Frac Testing Review• INJECTION-BREAKDOWN (DFIT) TESTS

Very Tight Gas (Nano-Darcy), DFIT 2

Pre-Frac Testing Review• INJECTION-BREAKDOWN (DFIT) TESTS

Very Tight Gas (Nano-Darcy), POST-FRAC COMMINGLED

Typo!

Pre-Frac Testing Review• INJECTION-BREAKDOWN (DFIT) TESTS

Very Tight Gas, (Nano-Darcy) Vertical Well, DFIT

Pre-Frac Testing Review• INJECTION-BREAKDOWN (DFIT) TESTS

Very Tight Gas, (Nano-Darcy) Vertical Well, POST-FRAC BUILDUPHistory

0

2000

4000

6000

8000

10000

12000

14000

16000

18000

20000

22000

24000

26000

28000

30000

32000

34000

36000

Pres

sure

(kPa

(a))

0 50 100 150 200 250 300 350 400 450 500 550 600 650 700 750 800 850 900 950 1000 1050 1100 1150 1200 1250 1300

Time (h)

pdata

t 0.00 h

t 0.00 h

pdata 2758 kPa(a)

t 1288.58 h

pdata 33618 kPa(a)

Pre-Frac Testing Review• INJECTION-BREAKDOWN (DFIT) TESTS

HZ Well, DFIT (Repeat Test)

Pre-Frac Testing Review• DFIT 1 • Repeat DFIT

Pre-Frac Testing Review

• INJECTION-BREAKDOWN (DFIT) TEST

Tool for frac engineers!

Pi & k may be obtained for “mD” rocks

Does not work for “sub mD” rocksUNKNOWN FRACTURE GEOMETRYUNKNOWN NET PAY TESTED

Pre-Frac Testing Review

• Perforation Inflow Diagnostic (PID) Test

Most Successful Pre-Frac Test AvailableINITIAL PRESSUREMATRIX PERMEABILITYRESERVOIR FLUID IDENTIFICATION

Simple Wellbore ConfigurationCost EffectiveWorks Every Time (> 90 %)Easy to AnalyzeNet Pay Controlled by Perforation Configuration

PROVIDE UNIQUE SOLUTION!

Pre-Frac Testing Review

• Perforation Inflow Diagnostic (PID) TestWellbore Configuration

Pre-Frac Testing Review

• Perforation Inflow Diagnostic (PID) TestVertical Well: 3 Intervals

Pre-Frac Testing Review

Controlled Net Pay

Where: n – meters of guns [m]

- gun frequency [shots/m]

d – perforation diameter [m]

d

Hkf

kv = 0

dn

PIDk khf

n

iifkh dkPID

1

dndn

ii

1

d

H

Pre-Frac Testing Review• Perforation Inflow Diagnostic (PID) Test

PID Analysis (McKinley Type Curves)

Pre-Frac Testing Review• Perforation Inflow Diagnostic (PID) Test

PID Analysis Results & HZ-MSF OPTIMIZATIONComparison

0

20

40

60

80

100

120

140

160

180

200

220

240

260

280

300

320

340

360

380

400

Gas

Rat

e (10

3 Sm

3 /d

)

0

10000

20000

30000

40000

50000

60000

70000

80000

90000

100000

110000

120000

130000

140000

150000

160000

170000

180000

190000

200000

Gas

Cu

m (1

03S

m3 )

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

LegendForecast 1 Cumulative Gas Production

Forecast 1 Cumulative Gas Production (2)

Forecast 1 Gas Rate (2)

Forecast 1 Gas Rate

HZ-MSF 0.0003 mDSchematic

xfy =8

0.0

m

xfy =8

0.0

m

xfy =8

0.0

m

xfy =8

0.0

m

xfy =8

0.0

m

xfy =8

0.0

m

xfy =8

0.0

m

xfy =8

0.0

m

xfy =8

0.0

m

xfy =8

0.0

m

xfy =8

0.0

m

xfy =8

0.0

m

xfy =8

0.0

m

Xw =-360.0 m

Xw =-300.0 m

Xw =-240.0 m

Xw =-180.0 m

Xw =-120.0 m

Xw =-60.0 m

Xw =390.0 m

Xw =0.0 m

Xw =60.0 m

Xw =120.0 m

Xw =180.0 m

Xw =240.0 m

Xw =300.0 m

Xw =360.0 m

Lex =720.0 m

Yw =

90.0

m

Xe =780.0 m

Ye =1

80.0

m

CONCLUSIONS

1. UNIQUE TYPE CURVE FOR HZ-MSF WELL PRODUCTION EXISTS

2. CONVENTIONAL APPROACH FOR PRODUCTION EVELUATION OF HZ-MSF COMPLETIONS WORKS

PSS Equation (Pi, km, A, s’, n)

3. IN-SITU km & Pi CONTROL AND DETERMINE HZ-MSF EUR

4. PID TESTING IS THE MOST ACCURATE PRE-FRAC TECHNIQUE Pi, km

5. DFIT TEST IS A GREAT TOOL FOR FRAC ENGINEERS ISIP, Breakdown, Closure, Tortuourosity

6. MAYERHOFER et al, PULLED THE PLUG ON “SRV”

THANK YOU!