Technology and innovation to help make the best decisions about where to drill and how to optimise fracking
Revenue-generating oil production is critical to make up for losses at a lower price per barrel. Since oil prices started to slide in September 2014, operators large and small have slashed spending in virtually every conceivable area. These cost-cutting measures are a double-edged sword, raising the question ‘how do we lower F&D costs, while increasing production and managing risk?’
Optimising production and estimated ultimate recovery (EUR) involves a lot of variables, including well placement, hazard avoidance, wellbore azimuth and inclination, well spacing, completion technique, fracture spacing and treatment type. This is especially true for shale, where every play is different and reservoir properties can change from well to well. Making decisions about whether or not to refrack and/or extend lateral length adds even more complexity.
The industry lost US$2.75 billion in services in 2014 from screen outs alone. Some operators estimate that only 5 to 8% of available resources are recovered from unconventional reservoirs. It takes innovation to lower finding and development costs, increase production, and reduce the environmental footprint.
Operational excellence led by intelligent use of technology is the answer, and Sigma³ is part of the immediate solution.
Helping operators face their challenges
How do we do it? By helping identify the shale resources with the best production potential and making their drilling and completions programmes, and frack campaigns as efficient as possible, before drilling begins. You can be confident that the optimal number – not the largest number – of wells are being drilled in the best locations (less sand, less water, less fracking), but with an increase in production.
Sigma3’s GeoEngineering solutions tie geosciences and engineering to production. The mix includes seismically driven geologic modelling and reservoir characterisation, microseismic, processing and interpretation, software technology and expertise under one integrated framework, and it helps clients deliver increased accuracy, maximum efficiency, and better production. Sigma³ solutions account for only about 1.5% of the total cost of a well, but the company states that the increased production that is delivered outweighs the cost of its services and technology.
Examples of the contribution these solutions make include:
* Mitigated losses of up to US$1.7 million for a large independent working in the Eagle Ford using on-site engineering workflows and expertise
* Delivered improved event location accuracy from 150’ to 30’ using adaptive signal processing & 3D velocity modelling in the Buda/Georgetown location
* Clients working in the Bakken, Eagle Ford & Woodford areas are predicting production with confidence – 80-90% – using Sigma³ Shale Capacity & Geomechanical Modelling workflows
* Avoiding screen outs with accuracy of 99.3% on horizontal wells using exceptional engineering workflows, saved Sigma³ clients US$22.7 million in 2014
* Clients working in the Bakken have gained US$3.4 million incremental production value per well
* A national oil company came to Sigma³ to pioneer onsite frack engineering in the world's second largest shale gas resource in Argentina.
The aim of Sigma3’s solutions is to enable users to have confidence about where to drill, as well as where and how to frack. The company sets out to optimise its customers’ field development strategy by identifying the surface locations and lateral landing zones that will deliver the highest production. The Shale Capacity model ensures users will predict well performance with a high degree of confidence and pinpoint the richest targets before drilling begins.
Another priority is to drill safely and ensure accurate 3D estimates for frack closure stress and frack height using expert 3D pore pressure and frack pressure prediction methods. Next comes the ability to predict and evaluate the geomechanical response of the reservoir to hydraulic stimulation using dynamic geomechanics to assess completion methods and reduce the number of sub-optimal frack stages. Accounting for the propagation and interaction of multiple hydraulic fractures with natural fractures by predicting differential stress, microseismicity and frack stage performance, ensures Sigma3’s customers will optimise SRV and accelerate revenue.
The company also offers tools to validate shale capacity findings in real time using high-confidence microseismic-led completions monitoring and use the results to optimise the next well. Finally, the company enables its clients to deliver actionable microseismic data by imaging 50% or greater data with adaptive signal processing and applying 3D anisotropic velocity models for improved location accuracy.
Avoid screen outs
Operators cite fracturing/stimulation and horizontal drilling as having the greatest impact on their spending plans. Between 2013 and 2014, the number of frack stages performed in the USA went up almost 20% to 550,000. The roughly US$38 billion invested in frack services was tempered by failure rates (non-productive clusters/stages) as high as 40%. This is a very expensive problem, and especially painful in today's low-commodity environment and in any region where the complexity of hydraulic fracturing is compounded by infrastructure and supply-chain challenges.
Despite technology improvements, screen outs are just one of the factors contributing to number of under-performing frack stages. The industry average for screen outs is about 5%, amounting to a loss of approximately US$2.7 billion in lost frack services. The good news is that Sigma³ averages a 99.3% success rate in horizontal screen out avoidance, and saved clients US$22.7 million in 2014.
Operators around the world have a unique opportunity to accelerate success in the shale market by fast-tracking the latest, most advanced technology; tested and honed on the front lines of US shale. The record-breaking investments and scientific discoveries that pushed the industry during the past several years have prepared E&P operators to thrive and produce more efficiently in this time of low oil prices.
Sigma³ addresses the demands of the next generation of conventional and unconventional resources producers through the development and delivery of GeoEngineering integration, resulting in better subsurface reservoir characterisation targets and optimal frack and completion strategies. Operators can increase production while reducing costs by fracturing the reservoir where it is most productive, and validating their results using highly reliable microseismic acquisition, event detection and location accuracy algorithms. The company helps clients target the sweet spots that will yield maximum EUR.