Petroleum Technology Transfer Council
PEOPLE AND CONNECTIONS
Shortening the Technology Application Life Cycle

Technology—The Engine That Drives O&G Production

PTTC Focuses On Ways To Cut Costs And
Save Wells
(Tech Connections Column, February 2009, American Oil and Gas Reporter)

The past six months certainly have been a wild ride in upstream oil and gas. Having once worked as a reserves/appraisal engineer, I can appreciate the “pain” companies may be experiencing in reserve write-downs with year-end oil and gas prices. New Securities Exchange Commission rules finalized at the very end of last year are a step forward with 12-month average pricing.

The American Association of Petroleum Geologists is developing a “reserves-oriented” event around its Denver annual meeting in June, and a more thorough geoscience technology workshop is being planned at a later date. Watch AAPG’s Web site (www.aapg.org) for details.

But enough of reserves, let us get back to the margin.

In the 1999 time frame, PTTC conducted workshops about how to properly shut in production so that when wells were brought back on line damage would be minimized. In most cases, wells are not yet being shut in, but margins are extremely slim in many areas. With slim margins, it’s once again time to think about “everyday” things that can be done to positively affect them.

In 2003, PTTC developed a handbook, Produced Water and Associated Issues (available online at http://www.pttc.org/
pwm/produced_water.htm), which besides addressing excess water production issues, deals with well bore management that maintains the health of downhole equipment in order to minimize the costs to lift fluids to the surface. Between them, authors Rodney Reynolds (then with PTTC’s North Midcontinent Region within the Tertiary Oil Recovery Project at the University of Kansas) and Bob Kiker (PTTC’s Permian Basin director within the Texas Region) possess more than 60 years of practical, handson experience, which they share in this handbook.

Obviously, there have been technology improvements since then, but many of the basic concepts remain unchanged. Readers are encouraged to spend a couple hours scanning this manual; I bet there are concepts that have slipped people’s mind that could be profitably applied. Kiker is at it again. He is developing a workshop titled “Watching Your Bottom Line.” Check PTTC’s calendar (www.pttc.org) for scheduling.

The produced water manual focused primarily on oil wells. For natural gas wells, there is another area where it would be profitable to refresh one’s memory: how to keep wells unloaded as liquids continue and pressures fall. For that I point readers toward the Artificial Lift Research and Development Consortium (www.alrdc.com). In an ambitious project, ALRDC is developing, with input from producers, technology providers and academia, recommended practices and guidelines for optimum deliquification (http://alrdc.org/recommendations/Gas%20Well%20Deliquification). Anyone for whom deliquification is a critical problem should consider attending the 2009 work shop on Feb. 23-26 in Denver (http://www.alrdc.com/workshops/2009_Spring2009
GasWellWorkshop).

When striving to maintain a margin, the focus should not be entirely on controlling costs. Look for well bore damage that has reduced productivity, or for affordable methods to stimulate the reservoir. Several years ago, Baker Petrolite developed its RESTORE Production Enhancement Program. Baker Petrolite claims actual field results in more than 80 percent of RESTORE treatments have significantly outperformed benchmarked performance.

Another technology that is worth a look is the GasGun. The GasGun (http://www.thegasgun.com/Technology.htm) is a relatively low cost, solid-propellant stimulation technology that creates multiple short radial fractures. It can break through near-wellbore damage or stimulate zones that may be susceptible to hydraulic fractures breaking out of zone. A few years ago, PTTC’s North Midcontinent Region worked with producers and J Integral Engineering to gather results on treatments in Kansas (http://www.kgs.ku.edu/PTTC/Case_Studies/Gasgun/). There certainly is more data by now, in Kansas and across the United States.

Tough times are also an opportunity to look for affordable development potential. Maybe one doesn’t have all the pay open. Technologies such as NuLook™ (respects conventional data and uses nuclear magnetic resonance-based outputs) provided by NuTech Energy Alliance (www.nutechenergy.com) can better define what is pay. In other cases, techniques such as GrailQuest’s (http://www.grailquestcorp.com/) volumetric balancing approach can quickly identify undrained hydrocarbons.

In this vein, PTTC’s West Coast Region is delivering workshops this month on 2- and 3-D techniques for evaluating properties. In mature properties there is always an abundance of historical (admittedly often incomplete) data to look forward. Some trends are obvious, while others may become evident only when artificial intelligence/neural net approaches such as those offered by The Correlations Company (http://www.correlations.com/
index.html) are used. When I started this column I was somewhat downcast, thinking about the “slim margins” operators were facing. After thinking about and describing some of the options available, I am ending this column with a sense of excitement. There is upside to be found even in difficult circumstances. Should anyone accept the challenge, his job is to realize that upside. It will take some sweat (and a bit of money), but it is there.