Revista E&P - Abril 2011

E P MAG.
COM
Marine
seismic
sets
sail
A P R I L 2 0 1 1
Subsea Technology
Directional Drilling
Riser Technology
Land Seismic
Improving
Exploration
Success
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IMPROVING EXPLORATION SUCCESS
New integrated seismic technology improves
well placement
GGI helps level the playing field for
independents
LAND SEISMIC
Land 3-D seismic survey designed to
meet new objectives
Piceance Creek pushes the land seismic
envelope
Geophysical data home in on sweet spot drilling
DIRECTIONAL DRILLING
Geosteering in unconventional shale
reservoirs has potential
Bed boundary mapping technology
improves success
SUBSEA TECHNOLOGY
Managing the threat of riser gas
Dynamic design tools increase safety
Deepwater production technology gets a boost
RISER TECHNOLOGY
New tool makes riser handling faster and safer
Riser bend stiffener connections prepare to go
ROV-less
IndustryPULSE:
New dynamics ahead
for energy, oil
It is difficult to make predictions, particularly about
the future Niehls Bohr, 20th century Danish physicist.
EXPLORATION & PRODUCTION
W O R L D W I D E C O V E R A G E
APRI L 2011
VOLUME 84 I SSUE 4
A HART ENERGY PUBLI CATI ON www. EPmag. com
COVER STORY
32
Marine seismic
surges ahead
Despite two years of setbacks,
the marine geophysical sector
is poised for busy times.
6
WorldVIEW:
Canada invests in
technologies to improve
oil sands development
John Hofmeister weighs in on
North Americas energy supply
10
12
Unconventional: Bakken
Bakken activity on the rise
New technologies are increasing recovery,
and operators are moving to delineate areas outside
the core Bakken region.
43
49
53
56
60
65
69
72
74
77
92
94
103
REGIONAL REPORT:
AUSTRALIA & NEW ZEALAND
83
01-4 TOC_APR_01-4 TOC 3/23/11 5:12 PM Page 1
AS I SEE IT
Change before you have to 5
MANAGEMENT REPORT
New model exists for engineering consulting 16
DIGITAL OIL FIELD
The industry needs next-generation content management 18
New standard streamlines software integration 24
EXPLORATION TECHNOLOGY
Geophysicists take on the next grand challenge 27
WELL CONSTRUCTION
Managing sand from the outset 29
PRODUCTION OPTIMIZATION
The adventure continues 31
TECH WATCH
Fractures detected without shear waves 96
TECH TRENDS
Innovations and new releases 100
INTERNATIONAL HIGHLIGHTS
Operators display global reach 110
ON THE MOVE/INDEX TO ADVERTISERS 115
LAST WORD
R&D needs government boost 116
E&P (ISSN 1527-4063) (PM40036185) is published monthly by Hart Energy Publishing, LP, 1616 S. Voss Road, Suite 1000, Houston, Texas 77057.
Periodicals postage paid at Houston, TX, and additional mailing offices. Subscription rates: 1 year (12 issues), US $149; 2 years (24 issues), US $279. Single
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No article may be reproduced or transmitted in whole or in parts by any means without written permission of the publisher, excepting that permission to
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DEPARTMENTS AND COMMENTARY
ABOUT THE COVER The satellite image shows the Von Karman vortices offshore
the Canary Islands, collected on June 6, 2010. (Image courtesy of Envisat MERIS, European
Space Agency, provided by Spatial Energy) In the Gulf of Mexico, a CGGVeritas vessel
shoots a wide-azimuth survey. (Image courtesy of CGGVeritas)
COMING NEXT MONTH May E&P features a cover story that brings you expert views on deepwater
challenges and solutions. Additional features present deepwater rig advances, flow assurance and sand and water
management technologies, and ways to extend reservoir life. The offshore regional report spotlights the Gulf of
Mexico, and the unconventional report highlights activity in Horn River. The May issue also presents the winners of
Hart Energys Meritorious Awards for Engineering Innovation. An extra plus in this issue is the first installment in a three-
part Special Report on Brazil. While youre waiting for the next copy of E&P, remember to visit www.epmag.comfor
news, industry updates, and unique industry analysis from Richard Mason, online executive editor.
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E
ach month, the pages of E&P magazine are full of technology advances that
have resulted from innovation and change the two primary constants in the
world of engineering.
It might surprise some to find out that the same constants hold true in the pub-
lishing world.
Hart Energy has been on the cutting edge of many changes in the industry. The
company was one of those that noticed the increasing significance of unconven-
tional resources and, in its role as a first mover, developed a conference series
focusing on developing unconventional gas and oil that continues to answer an
industry need.
Hart Energy also was on the cutting edge when it came to maximizing its presence
on the web providing news, information, data, and archives and pushing the limits
of information sharing to include daily news, exclusive editorial, blogs, webinars,
podcasts, and videos.
With the addition of Richard Mason in late February 2011 as executive editor for
the online component of E&P at www.epmag.com, Hart Energy once again has
pushed ahead of its competitors, offering readers a look at the industry that goes
beyond technology.
Many readers will remember Mason as publisher of The Land Rig Newsletter. From
1992 to 2009, he developed the first rig-count metrics involving land drilling activity
in unconventional plays to provide a high-resolution perspective on the land drilling
market, including regional rig use, rig pricing, technological evolution in drilling
systems, and rig employment patterns by operator.
Mason continues to monitor activity with regular exclusive features on the website.
As readers of E&P magazine, you can see some of Masons observations in Bakken
activity on the rise (page 83) and will have additional opportunities to read his
commentary in upcoming issues.
While Mason adds depth to our online coverage, Mark Thomas, London-based
international editor for E&P, is extending the breadth of the magazines interna-
tional coverage. Editor at Hart Energy Publishing from 1993 to 2000 and original
launch editor of E&P magazine, Thomas is no stranger to the industry. You can read
his first installment about Australasia this month in West coast gas bonanza lights
up Australias offshore future (page 103).
Thomas also will be managing production technology articles as Dick Ghiselin
moves to the E&P Advisory Board, where he will continue offering editorial guid-
ance and industry insight gained during 50 years in the oil and gas industry.
The directive, Change before you have to, is attributed to Jack Welch, chairman
and CEO of General Electric between 1981 and 2001. For
Welch, change often came at the price of losing people.
Fortunately for E&P, change for the better has come from
adding people who bring with them assets in the form of
breadth, depth, and industry experience.
As I
SEE IT
EPmag.com | April 2011
1616 S. VOSS ROAD, STE 1000
HOUSTON, TEXAS 77057
TEL: +1 713.260.6400
FAX: +1 713.840.0923
www.EPmag.com
Change before you have to
5
Read more commentary at
EPmag.com
JUDY MURRAY
Editor
jmurray@hartenergy.com
Editor JUDY MURRAY
jmurray@hartenergy.com
Senior Editor RHONDA DUEY
rduey@hartenergy.com
Senior Editor TAYVIS DUNNAHOE
tdunnahoe@hartenergy.com
Senior Editor RICHARD G. GHISELIN
dghiselin@hartenergy.com
International Editor MARK THOMAS
mthomas@hartenergy.com
Associate Editor ASHLEY E. ORGAN
aorgan@hartenergy.com
Corporate
Art Director ALEXA SANDERS
asanders@hartenergy.com
Senior Graphic
Designer LAURA J. WILLIAMS
lwilliams@hartenergy.com
Production Director
& Reprint Sales JO LYNNE POOL
jpool@hartenergy.com
Senior Editor/Manager
Special Projects JO ANN DAVY
jdavy@hartenergy.com
Executive Editor
Online RICHARD MASON
rmason@hartenergy.com
Online Editor REBECCA TORRELLAS
rtorrellas@hartenergy.com
Director of
Business Development ERIC ROTH
eroth@hartenergy.com
Group Publisher RUSSELL LAAS
rlaas@hartenergy.com
Vice President, Digital Media
RONS DIXON
Senior Vice President, Consulting Group
E. KRISTINE KLAVERS
Executive Vice President and CFO
KEVIN F. HIGGINS
Executive Vice President
FREDERICK L. POTTER
President and Chief Executive Officer
RICHARD A. EICHLER
05 AsISeeIt_Layout 1 3/24/11 9:13 AM Page 5
HART E ERG
N
iehls Bohrs words resonate as the world looks to its
energy future. With the Earths population at seven
billion, oil prices stressed by turmoil in North Africa
and the Middle East, global warming concerns, the rise
of China and India, and the shadow cast by the tragic
events surrounding the Deepwater Horizon, the industry
is hearing a call to action that is unambiguous.
From uncertainty to opportunity
Against this backdrop of uncertainty
and the inevitable anxiety of the
unknown, there is a parallel world full
of promise heralded by the emergence
of a highly competitive, diversified, and
tech-savvy energy market both in the
US and around the globe.
Currently, the US imports roughly
20% of its total energy needs esti-
mated at around 45 MMboe/d. The
impact is significant and burdens the
US balance of payments. What is less
widely recognized, however, is the over-
all inefficiency of energy use. Approxi-
mately 61% of energy produced in the
US is lost. On average, only one out of
three reservoir barrels is recovered,
which translates to an overall efficiency
of only 13% for oil that is converted to
a useable form.
Looking ahead, energy efficiency
both generation as well as consumption
offers a wide-open landscape for busi-
ness opportunities, especially to those enterprises that
can deliver superior efficiencies in capital deployment.
The industry is ripe for a fresh look at energy efficiency.
Technology reshaping future of oil
Technology is reshaping every facet of peoples lives
from Twitter to iPhones to cars that self-park. The
energy world is similarly affected by a wave of change
powered by new technologies. The resurgence of
US liquids production in recent years (5.5 MMgal/d
and trending up) led by Gulf of Mexico developments
as well as the steady growth of unconventional gas pro-
ductions six-fold increase over the last two decades to
approximately 32 Bcf/d in 2010 are clearly attributable
to advances in technology. To some degree, the return
also is due to more robust, albeit volatile, prices.
The energy industry can expect continual advances
in diagnostic and production-oriented technologies
allowing greater command and control of wells tens of
thousands of feet underground. Saudi Aramcos new-
generation fields such as Shaybah, Haradh, and Khurais
bear the latest testimony of multifold and sustainable
improvements in well productivities as a direct conse-
quence of new technologies.
The planet is endowed with plentiful sources of gas
and oil, conventional as well as unconventional. Some
estimates place global unconventional gas resources at
about 33,000 Tcf (roughly 5.5 Tboe). The outlook for
liquids is no less promising. At current rates of global
consumption, there are sufficient supplies to last into
the 22nd century.
April 2011 | EPmag.com
6
industry
PULSE
New dynamics ahead for energy, oil
It is difficult to make predictions, particularly about the future
Niehls Bohr, 20th century Danish physicist.
On average, only one out of three reservoir barrels in the US is recovered. (Source:
National Petroleum Council)
Nansen G. Saleri, Quantum Reservoir Impact LLC
06-9 IndPULSE-APR_06-9 IndPULSE-APR 3/23/11 4:55 PM Page 6
I have someone retiring after 33 years on the job.
I have someone taking 33 years of experience with him.
And now someone with just
3 years has to do that job.
117
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The interesting, and arguably not
obvious, consequence of these tech-
nology advances is that they generate
efficiencies on both the supply and
consumption sides of the energy
equation. Thus, while the global
demand for energy will continue
to grow, the makeup of the global
energy pie has yet to be determined.
Oil will be a key player, but its share
will depend on how well it does
against its competition fossil,
non-fossil, or renewables on three
benchmarks: 1) financial, 2) environ-
mental and safety, and 3) public
perception.
While the Deepwater Horizon
accident was a tragedy, it also was a
critical milestone, irreversibly changing the entire
risk assessment framework of the industry on all
three benchmarks.
Minimizing carbon footprint and resource steward-
ship (a Bill of Rights) likely will become the new impera-
tives for the energy industry. Slashing the current costs
of carbon sequestration by an order of magnitude, for
instance, offers a worthwhile grand challenge to the
R&D and technology communities in oil and gas.
Transitioning from peak
supply to peak demand
The world already has entered a new energy era that is
dramatically more competitive, diverse, and high-tech
than the past. Oil and gas, conventional and unconven-
tional, have to compete head-to-head with a host of fossil-
and non-fossil-based competitors, namely coal, nuclear,
and renewable alternatives such as solar and wind.
Oils role as the preeminent form of
energy will be challenged by economic, envi-
ronmental, and public perception metrics
that are ever-changing. The world has moved
into the peak demand mode away from the
past paradigms of peak supply. Global con-
sumers are the kings and will continually
reposition the market.
This new age offers huge opportunities for
new companies that can deliver superior
returns on capital deployment across all
aspects of the energy business exploration,
extraction, and consumption. The age of
13% usable energy efficiency as the norm is
over. The future energy picture for the US or
the planet is not constrained by the availabil-
ity of supply either for fossil or non-fossil
fuels but rather by the efficiencies of gener-
ation and consumption.
Editors note: This article is based on a speech
given by the author at the Association of Corporate
Growth luncheon on Jan. 11, 2011 (available at
www.qrigroup.com).
industry
PULSE
At current rates of global consumption, there are sufficient liquid hydrocarbon
supplies to last into the 22nd century. (Image courtesy of Quantum Reservoir
Impact LLC)
Some estimates place global unconventional gas resources at about 33,000 Tcf.
(Source: Journal of Petroleum Technology, December 2010, www.spe.com/jpt)
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Canada invests in technologies
to improve oil sands development
Canadian government agencies are assisting companies in developing technologies
that will increase production, decrease water use, and lead to faster reclamation in
Albertas oil sands.
10
world
VIEW
I
t is common knowledge that
the green movement has tar-
geted the oil sands. What is some-
what less well publicized is the
fact that the Canadian govern-
ment has targeted the oil sands as
well as an area for technology
investment that will improve the
environmental footprint of devel-
opment operations and increase
the amount of oil produced.
According to Chris Holly, who
heads the Research and Technol-
ogy branch of the Alberta Depart-
ment of Energy, there have been approximately 50
industry projects funded over the past five years. Holly
talked to Hart Energy about some of the research efforts
being funded by the Canadian government and the
potential gains those efforts represent for the industry.
What has Alberta done to match production to changing
demand?
Canada has no national oil company, so essentially the
process that is used is that we regulate in a market envi-
ronment. We regulate environmentally in a market envi-
ronment, and we also regulate, I would say, in terms of
resource development by our use of fiscal policies, royal-
ties, and taxes.
When oil spiked in 2007/2008, we saw a lot of reinvest-
ment. Thats just normal corporate behavior. You have a
lot of cash flow, you dont want to pay taxes, you reinvest.
This created a period of capital inflation. After a while,
companies found they couldnt afford the capital infla-
tion, and they backed off.
The profits also got involved very actively with develop-
ing better labor policies in terms of labor training and
relaxing immigration policies so we can bring in a lot of
people, for example, from Venezuela.
The government certainly did all sorts of things to
address some of the social infrastructure concerns, but
the reality is the industry ended up taking a look at price
and said, I cant afford to build in this capital and this
cost environment.
Oil prices are on the rise again. Has the fluctuation in oil price
affected investment in technology in your group in the last cou-
ple of years?
The nature of our heavy oil and oil sands is such that if
youre putting in the capital expenditure, youre not
responding to short-term business cycles. Youre respond-
ing to long-term expectations. So actually, in the last few
years, we have continued to see the sort of same produc-
tion growth rates that weve been seeing here in the last
10 years. Now were producing, if I recall, out of whats
deemed the oil sands deposits of about 1.5 or 1.6
MMbbl/d, and were producing about 500,000 or
600,000 b/d of conventional oil.
I should point out that there really isnt any distinction
between oil and oil sands. We have heavy oil deposits. We
are producing oil sands through primary technology. We
can pump it cold.
And were using polymers in the process. Its been
stated that Alberta may be one of the leading jurisdictions
in the world in the use and invention of polymers for
heavy oil production.
Were seeing some very interesting successes. Weve
seen projects go from 1,000 b/d as pilots to 50,000 b/d
commercial.
There are four polymer projects that have been pub-
licly announced. We fund some of these technologies in
terms of what we would call First Pilots, so a lot of the
investment actually is industry money. We potentially
come in somewhere in the order of 30%, somewhere in
that range.
What initiated polymer development?
It had much more to do with industry expressing interest.
Some of the earlier projects have a Chinese connection.
The Chinese have been quite heavily involved in the use
Christopher Holly
(Image courtesy
of the Government
of Canada)
Tayvis Dunnahoe, Senior Editor
10-11 WorldView-Holly_10-11 WorldView-Holly 3/23/11 4:55 PM Page 10
of oilfield chemicals in their heavy oil production. If you
follow at all the World Heavy Oil Congress, youll recog-
nize that Canada, China, Venezuela, and others are mem-
bers of it. So we actually saw a technology interest possibly
coming from that aspect into Alberta.
Polymers have been around for years, but now a new
generation of polymers is being looked at. Were seeing a
lot of use of polymers in tailing management in oil sands
mines, being able to take the water out and de-water the
tailing streams. So, a very fascinating area of technology is
developing with some very interesting commercial results.
Were doing some in-house work right now to get a bet-
ter understanding of what has happened in the dynamics
of the polymer markets.
What are some of the environmental advances in oil sands
development?
On the mining side, there has been continuous improve-
ment in operations to reduce the amount of energy that
is used in the extraction process. Weve reduced the tem-
perature from hot water to a warm-water extraction
process, and that has had a huge impact on reducing
energy costs.
Because the oil sands are water wet, you can extract the
oil from the sand with the use of caustics, soaps, and hot
water/warm water. Improvements in technology, both
from a mechanical process and from an oilfield chemical
process, have sped up the oil separation process using less
heat and less water. Less water means a lower pumping
requirement, so you have an environmental benefit.
What were also seeing on the tailing side now is much
faster opportunities to perform reclamation and to de-
water the tailing streams. And as you do that, you have
the opportunity of bringing back the land and more pro-
ductive capability quicker.
On the in situ side, youre seeing an advancement of
technologies for the use of polymers for heavy oil produc-
tion. On the thermal in situ side, were seeing some real
improvements in terms of understanding how the hole
chambers the steam chambers are developed and how
oil can be produced. So now you hear about things like
Fast SAGD (fast steam-assisted gravity drainage) where
after the chamber has been heated, we actually have the
ability to put it in horizontal wells without a steamer to
produce the oil because the chamber is hot.
Were looking at solvent addition that is facilitating the
ability to keep a well in productive capability. One of the
recent milestones is the advancement of metering and
monitoring technology. Were getting better and better at
controlling what were doing, but you have to see what is
happening downhole. So whether you do that using new
seismic technologies, new drilling technologies, or new
monitoring and metering technologies, its a critical com-
ponent of the process.
What are some of the steps being taken to execute faster
reclamation?
The fact is that 80% of reclamation involves replacement
of material back in the hole, and it is the final 20% that
has to do with the topping, the putting on of the organic
material the topsoil and the vegetation. Part of the min-
ing process, as in coal mining, is filling in behind the
operations. We do have to have some tailings ponds
because of the extraction process, but that does not rep-
resent the majority of the area. The majority of the area
can actually be refilled.
The other thing that people have forgotten is that what
is being reclaimed today (and very close to having final
certificate) are areas that were disturbed 20 years ago
when mining levels were in the range of 65,000 to 70,000
b/d. Today, were probably producing 800,000 b/d of
mining, but people are looking at it and saying, Well,
why havent you reclaimed at the same rate?
There is a lot of government policy directed toward
speeding up the reclamation cycle. Were funding differ-
ent technologies to improve upon the reclamation and
separation of materials. And were looking at some inter-
esting success thats coming forward.
11
Canada currently
produces 1.5 to
1.6 MMbbl/d from its
oil sands deposits.
10-11 WorldView-Holly_10-11 WorldView-Holly 3/23/11 4:55 PM Page 11
John Hofmeister weighs in on
North Americas energy supply
Restricted production in the Gulf of Mexico will push America to increase oil imports.
12
world
VIEW
A
fter his 2008 retirement from the position of
president at Shell Oil Co., John Hofmeister
founded and has served as chief executive of Citizens for
Affordable Energy. The organizations goal is to educate
Americans about energy and environmental challenges
and solutions. Hofmeister spoke with E&P magazine
about some of those challenges as well as crude supply
initiatives aimed at fueling North Americas energy
industry and consumer economy.
What is your outlook for energy affordability?
Its my view that global demand, including US demand,
is going to push oil price to triple digits this year, proba-
bly in the first half.
Is it accurate to expect US $5/gal gasoline in 2012 and
$100/bbl crude in 2011? I think OPEC will be reluctant
to increase production for a variety of reasons, not the
least of which is that some of its members are really
strapped with declining production. They need all the
money they can get.
How important is the resumption of deepwater drilling to US
energy markets?
With the Department of the Interior managing the rich-
est oil basin in the US to full stop in terms of future
drilling, production only declines in the Gulf of Mexico.
The absence of drilling will lead to production decline
at a time when the world needs more oil, not less. I am
projecting unscientifically up to 1 MMbbl/d short by the
end of 2012.
The natural decline of production with the absence of
new drilling yields roughly 1 MMboe/d out of the Gulf
of Mexico by the end of 2012 into 2013. It will take years
to recover that.
Will an incline in onshore unconventional oil production off-
set the decline in offshore production?
The Department of the Interior will quote figures of
(onshore) drilling increases for 2010 versus 2009 to
make it sound like drilling is increasing, not decreasing.
But thats different from (declining) production num-
bers from the huge reservoirs of the Gulf. Those will not
be offset by the small incremental amounts of uncon-
ventional oil coming out of the shale plays.
In other words, you can drill night and day, which they
do, but the amount of production is so modest relative
to the big reservoirs in the Gulf. You are not discovering
nor producing at the enormous quantities of the Gulf of
Mexico reservoirs.
If you compare Macondo at 65,000 b/d spewing into
the Gulf versus 1,000 b/d initial production, there is no
comparison.
We have in the Piceance Basin in the Rockies in
Wyoming, Utah, and Colorado about 1 Tbbl. But
development has been blocked, particularly by Denver
elected officials, most notably then Sen. Ken Salazar,
who now happens to be secretary of the US Department
of the Interior.
John Hofmeister is founder and CEO of Citizens for Affordable
Energy. (Image courtesy of Citizens for Affordable Energy)
Greg Haas, Editor, Hart Energys Refinery Tracker
12-15 WorldView-Hofmiester_12-15 WorldView-Hofmiester 3/23/11 4:55 PM Page 12
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When you have the Depart-
ment of the Interior run by an
attorney general which he was
before he was senator and a
prosecutor from the Department
of Justice, Michael Bromwich
(now director of the Bureau of
Ocean Energy Management, Reg-
ulation, and Enforcement), you
get what you get.
Thats largely a mindset which
says, Stop! so that no risk is
taken, or Stop! Or well prose-
cute! So we have been in a
stoppage.
Juan-Jos Surez-Coppel, CEO of Pemex, disclosed plans on
CNBC to ramp crude production for internal consumption
and export. Will rising Mexican production alleviate the US
shortfall from offshore?
The predicted rate out of Mexico that we heard was to
recover production to 3 MMbbl/d by 2015. But that did
not sound unequivocal he did not sound sure and it
was not a hard number.
If you tell the whole story of Mexico, they have mort-
gaged oil production in prior years for future produc-
tion. They are mortgaged nine years into the future.
They were paid already for production for 2013, 2014,
2015, etc. So what they have to do is to keep mortgaging
future production.
And that (forward arrangement) was mortgaged at
then-current crude oil prices. Mexico faces a severe rev-
enue problem which causes them to mortgage even
more production. So the people who are buying those
future contracts, theyre buying a lot of air.
The CNBC reporter after the (Pemex) report noted
that when politicians run the industry, you get what you
get. The same principal applies in this country when the
politicians run the industry.
Right now what we are seeing is the Department of
the Interior running the Gulf of Mexico right into the
ground.
Canada already is the largest source of imported crude oil to
the US. The TransCanada Keystone XL pipeline expansion
seeks to extend that supply. Do you have any thoughts on the
administrations delaying necessary permissions?
It is an absolutely necessary part of our future infrastruc-
ture if we are going to continue to supply American con-
sumers with the fuels that they need to live their lives and
to keep our economy strong. Thats point number one.
Point number two is that the
ecological issues raised by either
oil sands or by pipelines of such
great length crossing rivers, val-
leys, and lakes are fundamentally
manageable.
If the American consumer is
not going to be able to access the
Canadian oil sands product, you
can be absolutely 100% sure that
Chinese consumers will.
Canadas other major oil pipeline
operator, Enbridge, recently
announced an investment by Chinas
Sinopec to study the feasibility of a westward pipeline from
Alberta to Canadian West Coast export facilities. Do you have
any insight on that?
The reality is the oil sands oil is going to be produced,
period. It can go south, or it will go west to China. It will
be consumed.
If the administration is so short-sighted and so insensi-
tive to the affordability of fuels by the citizens of the US
as to deny the pipelines construction, it is only a matter
of time before the populace changes who is in govern-
ment through an election cycle.
The president is at risk of losing a re-election contest
based upon the real pocketbook issue of gasoline prices.
His own Department of the Interior is directly contribut-
ing to the risk by refusing to produce oil.
What else is in the hopper for the US E&P industry?
Two other (indicators) show the Department of the Inte-
rior is intent on stopping things from happening rather
than making things happen.
The Interior secretary, of his own authority and with-
out any congressional interactivity, has created a new
concept called the Wilderness Zone. The secretary
himself can determine areas sufficiently sensitive to dis-
allow mining, drilling, or any other industrial use. Even
worse, in my opinion, (is the development that) early in
December, the secretary announced that he would post-
pone the next five-year plan, due in 2012, to 2017.
That is a message to the industry that, whether the
president gets re-elected in 2012 or not, the Department
of the Interior of the United States of America is putting
on any offshore leases for the duration of how long they
might be in office.
That says to the world that the US is not going to pro-
duce its own oil and is going to rely on more imports.
This creates the psychology of high-priced crude.
15
The president is
at risk of losing
a re-election contest
based upon the
real pocketbook
issue of
gasoline prices.
world
VIEW
A
common problem in the oil and gas industry is a
mature asset that needs more attention than the
asset team is capable of providing.
In one recent case, the team leader was managing a
mature asset that needed a thorough engineering study
(the last one had been done eight years prior), but he
did not have the staff to execute the project inhouse and
was unhappy with the current batch of available consult-
ing options. He considered them either too expensive at
US $1,200 to $3,000 per man day, unavailable (I can
start in six weeks), or inflexible in their work methods
(I only know one software package).
The challenge
The team leader needed to have an
existing Petrel model updated due
to the acquisition of an adjacent
field. He needed to have this model
history-matched and upscaled and
simulated in Eclipse. Ultimately, he
needed to know where to drill the next
three infill wells.
To solve this problem, he tried a rising
class of consulting engineering companies
that are classified as iEngineers. iEngineers
execute classical subsurface interpretive and engi-
neering work over the Internet using the customers
native software and data platforms. This concept is the
logical extension of the telecommuting practiced by
almost all E&P engineers today, where people are work-
ing on desktops in one location with big servers and
data systems in another location.
iEngineering is not outsourcing
iEngineering companies differ significantly from out-
sourcing in that all work is executed on the customers
software platforms using remote access tools such as Cit-
rix or ThinAnywhere. Outsourcing can be thought of as
sending work overseas, iEngineering should be thought
of as flying in day workers over the web. Using the cus-
tomers software platforms ensures work consistency,
work processes and methodology control, information
security increases, and ultimately lower cost per project
versus traditional consulting service providers.
In a typical iEngineering engagement, the customer
and consultant must agree on three critical issues: com-
munication, access, and expectations.
In the example, the team leader and consultant agreed
on all three. Regarding communication, the consulting
team leader (a reservoir engineer with 15 years of model-
ing experience) flew to the customers office for the first
two weeks of the three-month project to ensure a smooth
kickoff. There also were scheduled biweekly project
review telemeetings using Webex, in which the consulting
team presented a milestones progress Gantt chart, tech-
nical issues update, and project process
issues. Outside of the weekly meetings, the
asset team leader and iEngineering team
leader remained in frequent email and tele-
phone contact.
The IT group helped establish secure
remote logins to the necessary Petrel and
Eclipse licenses. The licenses and project data
were placed in a secure demilitarized zone
that was established separately from the E&P
companys core network. All consultants
working on the project were required to pro-
vide photo identification information and for-
mally register as users with the IT department.
To manage expectations, the oil company and team
lead agreed to a walk before you run work arrangement.
For the first few weeks, the iEngineering team reviewed
every decision point. Once a level of trust and comfort was
established, the team was able to scale back the level of
approval to what was termed, Ask if you get lost.
As the weeks progressed, the relationship became
relaxed. A change in direction encountered during the
second month required an extension of the project scope
and budget. When the project ended, the remote team
prepared its technical conclusions and a draft of the final
report for review. The asset team leader led a manage-
ment presentation teleconference during which the
iEngineering team lead presented a 15-minute overview
of the technical recommendations for the field.
Management was interested in this alternative work
New model exists
for engineering consulting
iEngineering has the potential to accelerate subsurface studies.
Richard Ward, Tiandi Energy
16
management
REPORT
16-17 MgtReport_16-17 MgtReport 3/23/11 4:55 PM Page 16
iEngineers execute classical subsurface interpretive and engineering work over the
Internet using the customers native software and data platforms.
arrangement and asked the asset team leader about the real-world chal-
lenges of the project. He outlined the initial start-up problems concerning
data availability and agreement on reporting requirements.
A new alternative
The key takeaway is that for mature assets in need of re-engineering work,
an alternative source of consulting talent now is available. Accessing and
using this talent leverages existing software and hardware investments made
by all E&P companies, but it does require an adjustment to a modified work
arrangement.
In practice, this alternative consulting arrangement has resulted in:
Faster start times Due to increased availability of employee consulting
engineers in these new companies, customers are able to begin projects
without delay;
Greater consistency By definition, iEngineering projects use the cus-
tomers existing software and data platforms to execute the interpretive
and engineering work. This greatly increases the transparency and con-
sistency of the consultants work with the processes and norms of the
customer. It also reduces the black box situation in which a project
report is delivered, but the customer does not know how the results were
obtained; and
Lower cost iEngineering companies are global by nature. Their cus-
tomers, staff, and employees are located worldwide. This built-in access
to the global talent marketplace has resulted in a significant reduction
in skill-equivalent day rates. In several known cases, total project costs
were 40% to 60% less than the traditional alternative, while quality and
delivery times were maintained.
A transformative opportunity
To date, iEngineering companies have mostly executed traditionally defined
projects, including seismic interpretation, geomodeling, simulation, decline
analysis, and well data entry using traditionally sized consulting teams of
three to seven people. However, the potential exists for transformative
change within the industry. Resource constraints and high day rates have
limited the scope of projects that could be conceived and executed.
With access to fundamentally unlimited resources, the scope and scale of
what is possible could change within the industry. Now, when an asset team
manager arrives at the office on a Monday, there could be 20 trained petro-
physicists waiting and ready to tackle a big problem.
16-17 MgtReport_16-17 MgtReport 3/23/11 4:55 PM Page 17
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n some ways the oil and gas industry always has been
ahead of the curve when it comes to compute power
geophysicists, for instance, developed algorithms years
ago that are just now being used because computers
finally have caught up.
In other ways, however, the industry seems hopelessly
mired in some time warp while other industries are
much more nimble in adopting new technology. Take
data management, for instance. Data management
solutions have been around as long as computers have,
yet many companies still struggle to get a handle on
where their data are and how best to access them. Add
to that the fact that a data management system that
worked well five years ago now is obsolete, and a fairly
severe problem begins to rear its ugly head.
OpenText is helping other companies catch up to the
latest developments in computing, including social net-
working and computing in the cloud. Tom Jenkins,
executive chairman and chief strategy officer for Open-
Text, discussed the challenges facing the industry today.
The generation gap
When Jenkins recently was in Houston to meet with
energy companies and showcase his products, the CIOs
of these companies discussed some of the issues they
faced with the younger people in their organizations,
a group that Jenkins refers to as digital natives.
Our reality is that Facebook is now used more than
Google, he said. Google was the old way of us going to
the computer to get information. With Facebook, we go
to another human being to get the information.
In the authors note to his new book, Managing Con-
tent in the Cloud, Jenkins writes about the explosion of
social networking and why it has been so successful.
These applications became so widely used because they
allowed people to find information, collaborate, and
communicate faster than they could using other services
or similar portal sites. The rise of the Internet as a con-
nected network has allowed human beings to connect
and generate virtual human intelligence on a mass
scale.
With a growing workforce that relies on Facebook for
much of its information, it seems somewhat ironic that
all of the companies represented at the meeting block
its use by their employees. But when information
resides outside the firewall, problems can occur.
In one example, an airline discovered that its propri-
etary information was showing up on YouTube. Typically
when a part is changed, the airline needs approval from
the Federal Aviation Agency or other governing bodies
and then has to translate that information into dozens
of languages to be included in manuals all over the
world. Employees instead had videotaped the actual
changing out of the part.
Its language-invariant, Jenkins said. Its monkey
see, monkey do. The problem is that the corporation
didnt have an internal method for distributing the
information, so the proprietary information was starting
digital
OIL FIELD
The industry needs next-generation
content management
In a world that has been rocked by new computing techniques, the oil and gas industry
cannot afford to be left behind.
Rhonda Duey, Senior Editor
A website created for the G20 summit allowed participants to
communicate through a website that felt like social networking
but was completely secure. (Images courtesy of OpenText)
18
18-23 DOF-opentext_Layout 1 3/24/11 9:51 AM Page 18
18-23 DOF-opentext_Layout 1 3/23/11 5:15 PM Page 19
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Weatherford introduces the world's first packer-centralizers.
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OIL FIELD
to pop up outside the firewall. Its because people were getting frustrated.
That frustration is driving the need for companies to create their own
internal social networking. OpenTexts solution is to create internal ver-
sions of Facebook, YouTube, Wikipedia, etc., so younger workers can obtain
information in ways that are comfortable to them without breaching com-
pany security in the process.
Why would corporations not do this? he asked. The corporation that
does versus the one that doesnt is going to be way ahead.
Embracing the cloud
The profusion of digital devices cell phones, BlackBerrys, iPhones, iPads,
etc. has had a profound effect on the way business gets done, Jenkins
said. In the old world, we were PC- and data-driven, he said. Now were
mobile, and we have remote control of the desktop and remote servers.
The cloud has really expanded the flexibility of what we can do.
Jenkins showed an example of a command and control center in a
major US city. Information from a multitude of sources national news,
weather maps, traffic updates, etc. was constantly being updated on a
single screen, what Jenkins called a video mashup.
It allows you to take all of these inputs of information, both internal and
external, and get a view of whats going on, he said. Thats something that
for the oil patch is absolutely essential. It doesnt exist today. But it should.
With incidents like the Macondo disaster fresh in the industrys mind, it
is clear that this type of integrated, streaming data system potentially could
avert future catastrophes. The sooner you can react effectively, the less it
costs, he said.
In fact, much of what Jenkins preaches is the need for accountability. He
said this type of solution is particularly useful in industries that are informa-
tion-intensive and heavily regulated. He showed an example of a page that
had been created for the G20 meeting in South Korea. The website was
much like a Facebook page, but it was totally secure. Users could form com-
munities, post blogs, play videos, and chat. But the website also offered full
records management and archiving and would, Jenkins said, meet the test
of any government regulatory body. And it was accessible and instantly
changeable from a variety of digital devices.
That mobility is something the oil industry can take advantage of. The
amazingly transformative thing is your ability to manage information, share
it, and act on it, he said. Weve never had anything like this before. This is
so beyond a cell phone now.
Productivity gains
All of these new ideas are intended to improve productivity. Decisions can
be made more quickly, and records of these decisions are captured to main-
tain the audit trail. This stuff gives people a fighting chance to be both dig-
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Currently the oil and gas industry is in the process of finding, storing,
and integrating its data. The next step in the process will be what Jenkins
calls semantic navigation. This is a form of artificial intelligence or neural
networking where heuristic algorithms teach the system to recognize pat-
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some websites. Jenkins gave an example of a newspaper
website on which the main story would change based
on the readers history. Theyre serving up informa-
tion they know is more relevant to you, he said. They
want you to stay on their site longer.
No companies in oil and gas are using this concept
in an organization-wide sense, although certain seismic
processing techniques do employ the neural network
concept. Jenkins sees the semantic navigation as being
the next natural step.
Ultimately, semantic navigation will enable corpora-
tions to learn from past mistakes and achieve greater
productivity gains. It also will serve as a corporate
memory.
The digital natives think differently than we do,
Jenkins said. A lot of the discussion was about how
to build social networks, private-label Facebooks and
YouTubes and Wikis, so that the younger users can
start to learn from the previous generation without tax-
ing them.
Its a huge dilemma for the industry because, on the
one hand, the lessons of the past keep that corporation
out of trouble, but if they dont embrace the new tech-
niques and technologies, they will fall behind in pro-
ductivity. You have to build an effective compromise
between the two worlds. Its like a football team you
need rookies, and you need the veterans. The coach
has to coach for both. If you dont have that combina-
tion, youre going to lose.
digital
OIL FIELD
Semantic content is analyzed, annotated, and related.
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The Energy Flows Through Us
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24
T
he move toward automation on offshore facilities has
allowed drilling and production systems to work more
efficiently. Today, standard operations can be carried out
much more quickly than ever before, and sensor systems
deliver increasingly more real-time data. Intelligent opera-
tions (IO) puts information in the hands of decision-mak-
ers in real time, expediting the speed with which decisions
can be made and, in the end, increasing drilling and pro-
duction operations. In short, IO has delivered efficiencies
that were only dreamed about decades ago.
Along with efficiencies, however, software systems also
present challenges.
For software suppliers and system integrators typically
builders and shipyards the large number of systems pres-
ent on todays offshore facilities poses an enormous chal-
lenge. While hardware components are designed and
developed with the idea in mind that they have to fit
together at some point to form a system, software follows
no such protocol, which means when the time comes for
the individual software programs to communicate, the
path for communication normally is anything but smooth.
Making communication possible takes a great deal of
time. Unfortunately, time is money, and the longer opera-
tions are delayed, the more costly the integration process
becomes.
Paving the way
According to Charles McHardy, director of operations for
North America in the Gulf of Mexico region for DNV, the
more critical software becomes, the greater the challenge
of integration.
If you look at the digital oil field, the trend continues
to be toward more dependence on information technol-
ogy and software, he said. This has become a concern
because while the industry becomes more dependent on
these systems, the systems themselves are becoming more
complex and more critical to operations.
That observation was the impetus behind DNVs initia-
tive to create an Integrated Software Dependent Systems
(ISDS) notation that provides a common framework for
carrying out software integration. Quite simply, the ISDS
notation focuses on how to set up and run a project in
which software integration is critical and how to develop
quality assurance processes that will last throughout the
lifetime of the vessel on which the systems are installed.
David Card, technical director for software and systems
reliability at DNV, explained that a lot of the problems
that arise during commissioning center around getting
the systems to communicate with one other. If you estab-
lish up front an interface specification and require ven-
dors conform to it, you can avoid a lot of those problems,
he said.
Applying the class notation helps owners and operators
find a balance between the opportunities and the cost of
automation and to manage the risk related to poor quality,
incorrect functionality, and unsafe behavior. The ISDS
does not impose a new quality system, Card explained. It
ensures integration activities are planned, executed, and
managed according to best practices.
By streamlining the integration process, this guidance
improves project economics by reducing the time needed
to integrate systems and commission an offshore facility,
minimizing downtime and expediting initial production.
digital
OIL FIELD
New standard streamlines
software integration
ISDS provides guidelines for tackling costly software integration challenges that slow down
commissioning.
Judy Murray, Editor
This chart shows a typical distribution of activities throughout the
phases of software development and commissioning. (Images
courtesy of DNV)
24-26 DOF-dnv_24-26 DOF-dnv 3/23/11 4:56 PM Page 24
digital
OIL FIELD
25
Short-circuiting miscommunication
The ISDS identifies certain practices or processes that must
be in place. The ISDS doesnt tell you how to design or
integrate a system, Card explained, but it tells you, for
example, that you must have an interface definition, that
there has to be a place where you write down what all of the
interfaces are, and that you manage these things so every-
body can see the guidelines and everybody can conform.
An integration plan is required. Although this seems as if
it should go without saying, Card said, what has happened
in the past is that testing often has not been carried out in
a prescribed order, and that has led to problems.
Sometimes during commissioning, systems are being
tested by different vendors at the same time, and the tests
are not compatible. For instance, Card said, tests for the
emergency shut-down system and the drilling system have
been conducted at the same time. Though it is obvious
that these tests cannot be carried out simultaneously, the
fact is that if testing is not planned, it is easy for conflicting
tests to overlap.
Someone has to think about the order in which soft-
ware integration testing should be done instead of allow-
ing everybody to show up in the yard and carry out these
tests in any order, Card said. Software often arrives late
after the hardware has been delivered and installed so
the order of testing may not be the same as the order of
installation.
Preparing for change
By and large, drilling contractors have given the ISDS nota-
tion a warm reception. We came out with the class nota-
tion toward the end of last year, McHardy
said. Its been very, very well received, so
much so that we have at least a couple of the
major drilling contractors saying all new-
builds going forward will have this notation
for all of the complex control systems.
The reason for this, McHardy said, is that
rig owners are used to a class regime where
class notations ensure that what is delivered
from the yard meets their needs and has the
functionality and reliability required. This eliminates issues
in the operational phase.
The rig owners we talked to saw the ISDS class notation
or the potential for such notation as fulfilling a similar
role for them, McHardy said. They were particularly keen
to see not just the recommended practice but something
practical, a class notation they could use.
With drilling contractors embracing the ISDS, there
is a need for training, and that training has to be accom-
plished soon so yards are able to comply with the demands
of their customers. Weve been working on the yards as
well as with workshops toward the main yards in Korea like
HHI, DSME, and Samsung, McHardy said. The goal is to
have the yards ready and able to work to contractors
requirements.
According to Card, Petrobras was one of the early
movers, asking DNV to conduct an ISDS notation work-
shop for company personnel and the companys suppliers
of automated systems. One of the feedback items that we
got from that workshop was that they really liked the idea
that the roles were defined because it clarifies the expecta-
tion of who is supposed to do what, Card said. The sup-
pliers are supposed to do certain things, the integrator is
supposed to do certain things, and the owner is supposed
to do certain things. With the roles clearly defined, you
dont get into the situation of finger pointing and, Why
didnt you do that? I thought you were going to do that.
One of the most powerful things about the notation,
McHardy said, is that in identifying roles and responsibili-
ties, it will help eliminate unnecessary downtime. The ISDS
notation lets software suppliers know the requirements
early enough in their design and development process and
in their testing and verification of the software so problems
can be avoided in the hookup and commissioning phase.
Its not just a case of running into issues when the rig
goes out to drill and suddenly things are not doing what
they should be doing, McHardy said. Its actually in the
commissioning as well. It doesnt matter if youre delayed
20 days during commissioning or 20 days on your first well.
Its still 20 days at a cost of US $600,000 a day in lost time
and production.
An independent verifier is an organization mandated to inde-
pendently verify that the system is developed according to the
expected rules, standards, processes, and quality.
At a time when reservoirs are becoming harder to find, PGS delivers the
industry-leading solutions you need.
PGS can help your business achieve greater efficiencies and competitive
advantage with our full range of ground-breaking technologies - one of
these is our world-class seismic fleet, which has the ability to tow up to
22 streamers per vessel .
We set the standard for industry service, with our unique people-oriented
approach. During every project, you can count on our advice and support ,
because we are committed to helping you reach your business goals.
At PGS, we are your partner in technology, quality and reliability.
A Clearer Image
www.pgs.com
P
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for the challenges 1 tomorrow
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hile some majors have maintained active R&D
departments, others have opted for a more dis-
tributive model, funding research through service com-
panies and universities. While this often is a good way
to pursue targeted research, it makes it more difficult to
address grand challenges.
The Research Committee of the Society of Explo-
ration Geophysicists (SEG) decided to buck this
trend. In 2004 and 2005, members envisioned a col-
laborative research effort with a targeted industrial
goal. The result was the SEG Advanced Modeling
Corp. (SEAM), established in 2007.
SEAMs goal is to identify a grand challenge within
the area of geophysical modeling, conduct research
phases, and offer earth models and simulated data
representing significant geophysical challenges.
Phase I, which began in March 2007, focused on
deepwater subsalt tertiary basins. Expected to be com-
pleted in 2010, it was extended by an alliance with the
Research Partnership to Secure Energy for America,
which provided an additional US $2.6 million.
Recently SEAM announced plans for Phase II, which
will focus on land seismic challenges. Several oil and
service companies already have signed on to discuss
the definition of the challenge and the project scope.
Phase II will focus on three core challenge themes.
The first is high-density and areal-extensive acquisition
geometries. Industrys experience has consistently
been that subsurface images improve with every acqui-
sition and processing advance that moves toward true
3-D, the Phase II announcement document states.
Marine wide-azimuth acquisition is a good case in
point. However, land channel counts have always been
limited by what is technically, economically, and opera-
tionally feasible. The goal here is to provide simulated
datasets to evaluate the technical benefits of high-
density recording.
The second theme is near-surface complexities. Near-
surface heterogeneities wreak havoc on noise suppres-
sion and data processing and include topography, sand
dunes, dry river beds, steeply dipping layers, outcrop-
ping refractors, lateral velocity variations, velocity rever-
sals, layered basalts, carbonate karst, and anisotropy.
The hope is to provide realistic near-surface earth
models based on geological parameters transformed
to rock physics parameters. The efficiency of full
elastic simulation codes continues to improve, driven
in part by the activities of SEAM Phase I, the docu-
ment states. Near-surface simulations can now be
acquired for evaluation of acquisition, processing,
and imaging schemes.
Finally there is a focus on fractured reservoirs,
increasingly important with the growing interest in
unconventional plays. While seismic is recognized as
a valuable tool for horizontal wellbore trajectory plan-
ning and sweet spot identification, its use is compli-
cated by vertical transverse isotropy in both the
overburden and the target interval. Horizontal trans-
verse isotropy, on the other hand, provides a means
of identifying fracture density and horizontal stresses.
Project leaders hope to ascertain the relative benefits
of multicomponent data, bandwidth increases, and the
need (or lack thereof) for seismic to be an essential
component of a fractured reservoir exploration and
development program.
Currently a three-year project plan is proposed,
although participants in Phase II can modify this
approach. The first year will focus on earth model
design and fractured reservoir investigations, the sec-
ond year on seismic modeling simulations and a frac-
tured reservoir version of the base-case simulation
model. A simulated dataset will be acquired in the
third year.
For more information
about SEAM, visit
www.seg.org/SEAM.
Geophysicists take on
the next grand challenge
SEAMs next phase will tackle land seismic issues.
EPmag.com
RHONDA DUEY
Senior Editor
rduey@hartenergy.com
27
exploration
TECHNOLOGY
27-28 ExpCOL_27-28 ExpCOL 3/23/11 4:56 PM Page 27
27-28 ExpCOL_27-28 ExpCOL 3/23/11 4:56 PM Page 28
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well
CONSTRUCTION
S
and management is a reality in life-of-well plan-
ning. Standalone screens commonly are used to
mitigate problems associated with fines migration,
which can damage surface equipment and result in
a rapid decline of production for an otherwise
decent well. Gravel packing can assure a clean annu-
lar flow where the well bore has eroded in friable
zones, but this requires expensive pumping capacity
and sometimes more than several trips to provide
ample protection from solids intrusion. Expandable
screens have seen several innovations in recent
years, but even these have limitations in openhole
applications.
What if a material existed that could provide full
conformance with the sand face in just one trip? That
question may soon be answered. Shape memory poly-
mer (SMP) technology is not a new science. Open-cell
foams have been looked at for oil and gas applications
since 1990. It is only recently, however, that these
industries have found a common ground on which
to interact.
Early this year, Baker Hughes Inc. announced its
Geo Form Sand Management System, which uses
SMPs to construct downhole production strings that
meet the sand face, provide ample porosity, and guard
against fines migration for possibly 10 years or more.
The concept relies on specialized polymers that are
molded and milled to a desired shape and size. Baker
Hughes has on offer two current sizes. The 2
7
8-in. by
6-in. screen has a fully compacted OD of 4.6 in. Once
activated, the screen expands to 7.16 in., which is rec-
ommended for 6-in. to 6
1
4-in. openhole completions.
The 5-in. by 8-in. screen fully compacts to 7.125 in.
with an expanded OD of 9.390 in. and is designed for
8
3
8-in. to 8-in. hole. Both screens are designed to
operate between 105F to 195F (40.5C to 90.5C),
although the company is researching methods to
expand this to a higher range.
According to Baker Hughes, these new screens are
ideal for gravel pack replacement, long horizontal
wells, slimhole applications, and remedial sand con-
trol. In their compacted state, the screens have proven
to withstand scarring in drill tests of up to 4,000 ft
(1,219 m) of lateral movement at 30 rpm.
This smart material is activated downhole through
exposure to bottomhole temperatures and specialized
catalysts to unlock the compacted screens once in
place, allowing the SMP to return to its original shape,
conforming to the annulus of the well bore and filling
in any irregularities as it expands. An interesting fea-
ture to these new screens is the materials replication
of pore space. Whereas porosity is devised from the
space between the solid particles within a reservoir,
the shape memory material provides an inverse of this
matrix with its pore space in closer relation to actual
grain size. Also, it is designed with a 10:1 ratio of
radial to axial permeability to prevent solids migration
to the well bore. Fully expanded screens using mem-
ory SMPs provide about 80% porosity; even at full
compaction the screen maintains 10% porosity.
So what is the bottom line? According to informa-
tion provided by Baker Hughes, gravel packs have a
historical transactional failure rate of 16%, which
translates to more than five hours of nonproductive
time (NPT) per tool per well. In its current tests,
Baker Hughes Geo Form screens have shown a trans-
actional failure rate of less than 4%, with an NPT of
less than one hour per tool per well. Overall, this new
technology could net operators a 75% reduction in
NPT and associated costs (roughly US $100,000 per
well) within this segment of the completions process.
As with any new technology
entering the market, it will be
interesting to see how these
tools perform in the field
and if they will gain accept-
ance over time.
Managing sand from the outset
SMP technology is entering the world of well construction.
EPmag.com
TAYVIS DUNNAHOE
Senior Editor
tdunnahoe@hartenergy.com
29
29-30 WellConstruction_29-30 WellConstruction 3/23/11 4:56 PM Page 29
29-30 WellConstruction_29-30 WellConstruction 3/23/11 4:56 PM Page 30
CLEANER
At Newpark Drilling Fluids
,
environmental
responsibility is not just technology jargon.
Our R&D efforts revolve around innovating
for a cleaner tomorrow and help us keep
our customers ahead of regulatory
requirements.
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As the leader in high-performance , water
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Got a challenge? We ' re listening. Our success
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NEWPARK
DRILLING FLUIDS
production
OPTIMIZATION
E
very day, we see our industry, our livelihood, casti-
gated in the press and in the halls of government. It
is time to do something about it. With few exceptions,
public opinion regarding the oil and gas industry is
based on ignorance. They do not know any better. And
whose fault is that? It is ours, whether we want to admit
it or not.
Our industry has its enemies, but in large part, these
are zealous but misguided individuals who are ignorant
of the role played by the energy industry in shaping the
world economy. Worse still, these people have no idea
of the role a strong energy industry will have in the
future well-being of themselves and their descendents.
Fortunately, we have the talent and resources to do
something about this. If you accept that
90% of the problem is caused by igno-
rance, then it should be obvious that
90% of the solution can be gained
through enlightenment. Those of us in
the industry yes, I am talking to you
can work to change public perception.
No one else will do it, so if it is going to
get done, it is up to us all of us.
There is a popular saying going
around these days: If you love freedom,
thank a soldier. We need a similar saying: If you love
peace, health, and prosperity, thank the energy indus-
try. Think about it. Without the efforts of the energy
industry, it is very likely that World War II would have
had a different outcome. Without energy to fuel indus-
try, there would have been no guns, tanks, planes, or
ships. Without energy, there would be few jobs outside
of agriculture, and those still farming would be plowing
with a team of mules. Without energy, there would be
no international commerce, no trains, airlines, trucks,
and cargo vessels. The free worlds economies are built
on abundant and reliable supplies of energy. All we have
to do is start talking about this.
Every one of us has the opportunity to sway public
opinion. When we speak to our children, to our friends,
to civic and professional groups, we need to tell the
energy story. Talking among ourselves is preaching to
the choir. We need to get out in the world with our
message: Energy is the lifeblood of our civilization.
Today, we derive energy from oil and gas; tomorrow
we could tap another resource, but there is no substi-
tute for energy.
Our professional societies and organizations need to
take responsibility for educating the
public. We have been silent too long.
Through education outreach, we can
engage a generation of young people
and shine a light on their knowledge
about energy. In an age where we can
send people into space and bring them
home safely, it is a travesty that there still
are university graduates who think that
oil exists in huge subterranean pools or
rivers. There actually are people who
think, We do not need oil or gas; if we want heat or
light, all we have to do is flip a switch. There is a grow-
ing fringe of the population that believes drilling and
completion practices are polluting drinking water with
mysterious toxins and carcinogens. Who is going to edu-
cate these folks? It had better be us because no one else
will do it.
I want to get off my soapbox long enough to welcome
my long-time friend and colleague, Mark Thomas, to
these pages. Mark is a true professional and a journalist
of the highest reputation. He was present at the birth of
Hart Energys E&P magazine, and it will be great having
him back onboard. He brings an international perspec-
tive at a time when the global oil and gas industry stands
on the threshold of greatness, with deep-
water E&P and the tantalizing pos-
sibility of vast worldwide shale gas
resources on the horizon.
The adventure continues
In my final column, I want to challenge each and every one of you to
pay a little back to the industry that put food on your table, a roof over
your head, and a sense of accomplishment in your heart.
EPmag.com
DICK GHISELIN, P.E.
Senior Editor
dghiselin@hartenergy.com
31
If you love
peace, health,
and prosperity,
thank the
energy industry.
31 PRODcol_31 PRODcol 3/23/11 4:56 PM Page 31
32
F
unny what a difference a decade makes. In 1999, the
seismic industry was cursing the multiclient business
model since it had been used as an excuse to keep boats
busy when no contract work was available. In 2011, the
multiclient model is being praised as one of the segments
that helped keep the marine industry afloat during the
recession and the fallout from Macondo.
That is one of many observations made by companies
in the marine geophysical industry. E&P asked these com-
panies about the recession, Macondos impact on their
business, and their plans going forward.
The recession
During the recession, some companies fared better than
others. Companies that operate mostly on a contract basis
said that 2009 actually was a better year than 2010
because they were working through their backlog,
whereas companies that operate more on a multiclient
basis said 2009 was a very difficult year.
Together with the fall in oil prices and the general
economic downturn in 2008-2009, the profit mar-
gins for contract seismic were eroded significantly in
2010 compared to 2009, said Per Arild Reksnes,
executive vice president, Marine Contract for PGS.
However, the need for new and better seismic data to
find more oil and gas has made oil companies willing to
steadily invest in multiclient data.
According to Benot Ribadeau-Dumas, executive vice
president, Marine Division, CGGVeritas, the mid-decade
technology gains such as wide-azimuth (WAZ) seismic
helped. Demand was driven by technology (higher reso-
lution surveys) and a general increase in regional activity,
he said. The seismic services market also improved, with
commercial activity increasing globally in most regions.
However, he added, pricing remained under pressure
due to a longer period of overcapacity than originally
expected, mainly based on events in the Gulf of Mexico
(GoM).
Unlike previous downturns, when oil companies were
less likely to insist on using the latest technology, demand
still was strong for high-end services. It was interesting
during the recent downturn to note that our clients did
not stop exploring, nor did they trade down from WAZ,
4-D, and other high-end approaches, said Edward
Kotochigov, marine marketing manager for West-
ernGeco. These services deliver the incremental
value clients are looking for.
He added that, while overcapacity has been an issue,
techniques like WAZ consume many more vessel months
per square kilometer than conventional narrow-azimuth
exploration. This sucks up a lot of vessel capacity, and as
they grow, the industry will face localized shortfalls later
in 2011 and 2012, despite the addition of new capacity.
COVER STORY:
MARINE SEISMIC
Despite two years of setbacks, the marine geophysical
sector is poised for busy times.
MARINE SEISMIC
32-42 COVERstory_32-42 COVERstory 3/23/11 4:57 PM Page 32
33
BGP Inc. already has plans to launch a 12-streamer
vessel. The objective is to meet higher demand from our
clients, said Zheng Huasheng, vice president of the com-
pany. The vessel will be outfitted with ION Geophysicals
DigiSTREAMER system.
This need for the latest data has played nicely into the
hands of TGS, a company that relies almost solely on a
multiclient model. CEO Robert Hobbs said once compa-
nies are ready to start exploring again, the quickest way
for them to do so is to license data off the shelf rather
than embark on an expensive and time-consuming pro-
prietary survey. It does require, of course, that the data
being shot on a multiclient basis are in an area of interest
to the oil companies. Hobbs said his com-
pany has to stay out in front of its clients
and to invest almost counter-cyclically.
We didnt significantly decrease our investments in
2009 from 2008, he said. Our asset-light business model
allows us to take advantage of the cycles in our industry.
We are going to the other seismic vendors to get vessel
capacity. We can get it for lower cost because of the mar-
ket, and I can continue to invest in multiclient data and
then be prepared for the upswing when it comes.
Overcapacity in the market is good not only for TGS,
Hobbs said. We like it when we see these companies
announce new vessels on the market because it gives us
more capacity to utilize, he said. But its also a sign that
those companies have a positive view on the marketplace
they believe demand for seismic is going to increase
going forward.
SURGES AHEAD
The BOS Arctic heads
to the North Sea for the summer.
(Photo courtesy of Bergen Oilfield Services)
34
Macondo
As the global financial situation began to stabilize, the
industry as a whole was starting to view 2010 with at least
a faint ray of hope. That changed on April 20 when the
Macondo well in the GoM blew out, killing 11 people and
causing the worst environmental disaster in US history.
The Obama administration acted quickly to repeal ear-
lier claims that licensing rounds would be held in the east-
ern GoM and the East Coast of the US and declared a
drilling moratorium in the deepwater GoM. This had an
immediate near-term impact on the geophysical industry.
Even companies that had no activity in the GoM felt the
impact. Since 2009, we havent been in the GoM, so we
havent been relying on that business, said Jan Svik, vice
president of marketing for Bergen Oilfield Services (BOS).
But it has affected the vessel availability, meaning that a
number of seismic vessels have been pulled out and have
been spread to other markets. Thats putting pressure on
prices and availability of work in other markets. So indi-
rectly it has affected us.
Companies active in the GoM had considerable fallout.
Uncertainties in the Gulf shaped multiclient sales in
2010, which were below typical levels until the fourth
quarter, said Ribadeau-Dumas, adding that this uptick
was driven by a renewed interest in activity despite the
ongoing uncertainty. In fact, several companies 4Q 2010
earnings were far above analysts expectations, driven
mostly by multiclient sales.
Added Reksnes, The event led to a halt in the oil com-
panies purchasing of seismic data for some time. Their
willingness decreased significantly to prefund new surveys
in the deepwater areas because they didnt know the
future conditions.
Also, the incident has increased the attention opera-
tions connected to oil and gas exploration get in the pub-
lic domain, especially the HSE elements.
WesternGeco continued to explore in the GoM because
its clients were enthusiastic about its dual coil project, said
Kotochigov. They signaled that they had confidence in
our capabilities and would continue to support us, he
said. We appreciate that for our clients in the Gulf of
Mexico it was a challenging year that will take some time
to work out. However, the Gulf of Mexico is recognized as
one of the worlds major basins, and its long-term impor-
tance to the domestic economy is not in doubt.
This is being expressed by clients which, based on the
4Q 2010 results of CGGVeritas and others, are signaling
their continued interest in the area through their wallets.
Ribadeau-Dumas noted that WAZ prefunding and sales
remained active throughout the year. This highlights the
long-term confidence in and importance of the deepwater
Gulf of Mexico to the industry and the value that wide-
azimuth brings to exploration and production, he said.
Its interesting, added Hobbs, because oil companies,
while theyve been very cautious about the GoM, are still
buying seismic data there. That says theyre taking a
longer-term view.
This is a sign of preparedness for when normalcy
returns, so oil companies are buying seismic data and
maintaining employment levels for geologists and geo-
physicists, he said.
The view for 2011
Even without unrest in the Middle East and North Africa,
which likely will put upward pressure on oil prices (which
occurred after these interviews were conducted), geo-
physical contractors in general seem bullish on 2011
and beyond. According to Kotochigov, 2011 will be a busy
year. We see a high level of bidding activity in the indus-
try, and we have a confirmed backlog through 3Q 2011.
In fact, as expressed as quarters of activity, the global
seismic backlog is the highest it has ever been.
For CGGVeritas, the year could partially restore the driv-
ers that pushed oil prices so high in 2008. We see global
energy demand at peak levels, low reserve replacements
rates, complex and challenging exploration opportunities,
and maturing reservoirs, said Ribadeau-Dumas. In the
face of these challenges, most analysts estimate that E&P
spending will increase in 2011, with exploration and seis-
mic spending outpacing the general trend.
He added that he expects the marine market to be up
around 20% over 2010, and it will continue to strengthen
COVER STORY:
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in most regions, though not necessarily the GoM. Svik
said BOS will be active mainly in the Middle East and Asia
while wrapping up a survey in the North Sea and planning
a return to West Africa. Many companies also are tenta-
tively targeting the Arctic.
The Arctic is an area that has not really been solved,
said Tim Rigsby, senior vice president, Strategic Initiatives
for ION Geophysical. Its a challenging area to operate
in, and its an area where oil companies have a tremen-
dous need for data. To help companies get the data they
need, we developed proprietary technology that allows for
in-ice acquisition. Using this technology, weve expanded
traditional acquisition boundaries into new territory and
extended the shooting window far beyond what was previ-
ously possible. IONs Arctic data library now contains
more than 30,000 miles (50,000 km) of data across the
Canadian Beaufort and US Chukchi seas as well as north-
east Greenland.
Polarcus brings DNV-acknowledged arctic procedures to
the area and winterized vessels with high ICE-1A Class.
It is the only seismic company in the industry with 3-D
vessels less than 20 years old that carry this class notation.
On order, with delivery early in 2012, are two new 14-
streamer seismic vessels, which will incorporate ICE-1A
(super ICE-Class) capabilities.
Technology leads the way
It has been refreshing for these companies to see the
industrys consistency in its interest in new technologies
despite the downturn. One of the key technologies cited
by many players is increased bandwidth.
The benefits of acquiring broadband marine seismic
data have long been accepted, but until recently this has
been difficult, if not impossible, to achieve, Ribadeau-
LEFT: CGGVeritas Oceanic Vega shoots a WAZ project in the
GoM. (Image courtesy of CGGVeritas)
ABOVE: Technicians work in the recording room during a dual
coil operation. (Image courtesy of WesternGeco)
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Dumas said. Today, new equipment, techniques in acquisition, and
advances in imaging technology have overcome most challenges.
Obtaining a larger range of frequencies also is desirable, Ribadeau-
Dumas said, because broad bandwidth produces sharper wavelets for better
resolution. Several companies have introduced broadband solutions:
CGGVeritass BroadSeis solution combines equipment with novel acquisi-
tion geometries and proprietary processing algorithms to produce better
subsurface images;
WesternGeco offers DISCover, a full-offset broadband solution; and
PGS has its GeoStreamer cable system and now is working on a new
source technology that applies similar de-ghosting techniques on the
source side. The end result, Reksnes said, is increased amplitude in the
low and high frequencies.
In addition to streamer techniques like WAZ surveys, ocean-bottom cable
and nodal systems also are gaining favor. Shell recently showcased a new
type of autonomous underwater vehicle that can be preprogrammed to
place sensors on the seabed, eliminating the need for costly ROVs.
But better data require better processing, and many see this as an area
that will undergo major improvements in the next few years. We believe
that the new acquisition technology will be followed by processing technol-
ogy, taking advantage of the increased bandwidth and the ability to use both
the up- and down-going wavefields in imaging and multiple removal, Rek-
snes said.
Huasheng added, Imaging is a continuous R&D program. Reverse time
migration (RTM) and RTM with anisotropy algorithms will become a stan-
dard migration.
At TGS, one of the ways it stays ahead of its clients is through interpreting
its own data, and this requires advanced processing. Where we differenti-
ate the quality of our product is in the processing of the seismic data,
Hobbs said. Thats when you assure the quality; thats when you make sure
that what you give the client is error-free and the highest resolution that you
can deliver. If you look industry-wide, most of the technology advancement
and differentiation has been on the processing side of the business.
COVER STORY:
MARINE SEISMIC
The marine market still lags behind land in all regions. (Graph courtesy of World
Geophysical News)
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ISMIC'"
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COVER STORY:
MARINE SEISMIC
TGS and others also are taking advantage of advances in
computer technology, and an exciting recent move is shift-
ing the processing from central processing units to graph-
ics processing units (GPUs). Right now were moving
toward doing more of our RTM on GPUs, Hobbs said.
The improvements in speed have been quite impressive.
A wild ride, as always
Geophysical contractors are no strangers to difficult mar-
ket conditions, and these past few years again have chal-
lenged them to face down tough problems. But something
seems different this time, and it is possible that oil and gas
companies finally are in sync with their seismic contrac-
tors, paying a premium for new technologies even in the
darkest times because they know these technologies will
get them closer to the answers they need.
R&D has not taken a backseat to survival, and the results
truly are paying dividends.
T
he marine seismic industry was not the only industry
struggling through the recession. Companies offer-
ing electromagnetic (EM) services have been struggling
as well. In many ways the two services are similar, but in
some ways theyre very different.
Dave Ridyard, president of EMGS Americas, said 2010
was only better than 2009 because 2009 was a cata-
strophic year. Unlike seismic, which is a widely
accepted technology, the jury is still out on controlled-
source EM (CSEM) data, which its proponents claim can
image direct hydrocarbon indicators in the subsurface
due to resistivity contrasts. It also is a rapidly developing
technology.
When times are hard, oil companies have an under-
standable tendency to limit expenditures to the tech-
nologies they know best. People in the oil industry
believe in a technology when people have drilled wells
successfully based on it, Ridyard said. If you think
about wells that companies are announcing results for in
the past 12 months, they were probably doing the EM
work in 2005 or 2006. You are talking about people
assessing a technology based on its state of the art four
or five years ago, and at that point it was two years old.
The technology has picked up since then, and by
2008 EMGS had a 3-D product and an anisotropic inver-
sion product. We felt like the technology was just start-
ing to pick up. But its taken a hiatus because of the
financial crisis.
Added Richard Cooper, CEO of RSI, Although com-
mercial pickup is slower than we would like, this is to be
expected given the relative immaturity of the technol-
ogy compared to seismic, the conservative nature of the
oil and gas industry regarding new technology, and the
current economic climate. However, we believe careful
application of CSEM technology will lead to satisfied
clients, repeat business, and growth in the acquisition
market.
Given the newness of the technology, EM companies
have a rather odd business cycle. Companies will shoot
a survey and wait for the results. If they are not happy
with the results, they wont necessarily abandon the
concept altogether, but they will not be immediate return
customers.
Companies that are happy with the results, on the
other hand, examine their existing portfolios and ask
their EM provider to acquire a multitude of surveys over
this acreage to help de-risk drilling prospects.
All of a sudden, that customer becomes our biggest
customer for 18 months, Ridyard said. Then, when
theyve worked their way through the backlog, it drops
off to steady state.
EMGS is teetering on the decision to launch a third
boat, in part driven by its intention to continue to grow
the multiclient market. Already it has shot two wide-
azimuth 3-D surveys in the Barents Sea and two more in
the Gulf of Mexico, and it has plans for other parts of the
world as well.
The economy of scale of doing 3-D seismic on a large
scale allowed the data to get into the hands of mid-sized
and small companies, Ridyard said. I think were start-
ing to see the beginning of that same process this can
actually be used as a frontier exploration tool rather than
just a drilling de-risking tool.
Cooper disagrees. CSEM in its current form is best
used for reservoir characterization and appraisal, he
said. Its good at answering questions such as, Is the tar-
get reservoir charged? What is the lateral extent of the
reservoir? What are the saturation levels? This is simply
a fluid substitution question. Can we measure the resis-
tivity anomaly induced by the presence of hydrocarbons
against a background response? In frontier areas, we
dont know the background with sufficient certainty, and
therefore we cannot reliably and robustly interpret any
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IMPROVING
EXPLORATION SUCCESS
T
he primary inputs to drilling planning and execution
are from seismic and well data. An earth model con-
sisting of structural information with geological targets
and faults and with relevant formation properties such
as pore pressure and fracture gradient guide drilling
decisions to help place the well in the right geological
target and to avoid drilling hazards. The best possible
accuracy and resolution at the well location is required;
therefore, all available information
needs to be optimally combined
and used with the latest model-
building and imaging technologies.
The lack of adequate technolo-
gies and measurements, along with
turnaround time limitations, have
made this type of optimum use of
seismic and well data (predrill and
while drilling) impractical until
now. Recent developments in
model building, new rapid and
more accurate imaging technolo-
gies, and the availability of new
well measurements are making
this optimum combination more of a reality. This new
approach, seismic-guided drilling (SGD), has been used
in a Gulf of Mexico (GoM) well, demonstrating the
potential value it can provide to drillers.
Components of a seismic project for drilling
Three key components of this approach differentiate it
from other applications. The first is a small volume of
interest. An earth model relevant for drilling a particu-
lar well covers a volume that includes the planned well
trajectory and possibly neighboring locations with well
or geological information the drilling volume of inter-
est (DVI). The size of the DVI typically is much smaller
than that used for other seismic applications such as
regional imaging. The relatively small data volume
allows the rapid use of sophisticated techniques to build
and update the best possible high-resolution earth
model in the DVI.
The second component is integrating well informa-
tion. In a drilling project, there is at least one well
i.e., the one being drilled in addition to any offset
wells. Availability of new well measurements, such as
checkshots and vertical seismic profiles (VSPs) while
drilling, and technologies that can optimally integrate
them with seismic information to constrain the local
earth model, such as well-constrained tomography, are
critically important.
The final approach is a fast turnaround time in
time for drilling decisions. The turnaround time of
earth model building/updating and reimaging needs
to be performed in the drillers time scale, in time for
decision-making for both baseline and while-drilling
updates. New high-end imaging algorithms such as
Gaussian packet migration that can handle complicated
geology and produce rapid remigrations are required.
Drilling challenges
Seismic information cannot address all of the challenges
drillers face, but seismic data can help with a number of
important ones. One area is better well placement.
New integrated seismic technology
improves well placement
The full potential of seismic data for drilling applications is increasingly being realized by
advanced earth model building and new rapid imaging technologies.
Cengiz Esmersoy, Annabelle Kania, Andrew Hannan,
Lee Lu, Sharon Teebenny, and Ling Duan, WesternGeco;
and Arturo Ramirez, Schlumberger
The SGD project execution consists of three phases: feasibility, drilling baseline model, and
while-drilling updates. (Images courtesy of WesternGeco)
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IMPROVING
EXPLORATION SUCCESS
This includes:
Reducing uncertainty in the location of drilling
targets, including casing points, faults, and target
reservoir(s);
Quantifying uncertainty of drilling target loca-
tions; and
Improving reservoir property and structure defini-
tion through inversion.
Seismic data also can help avoid drilling hazards
through shallow hazard identification improvements,
pore pressure and fracture gradient estimates, reduc-
ing and quantifying uncertainties in estimates, and
identifying other regional hazards such as tar and gas
hydrates.
Project execution
An SGD project starts with identifying challenges and
risks expected when drilling a particular well. A base-
line earth model is constructed, and the model is
updated while drilling. There are three phases of proj-
ect execution.
During the feasibility phase, candidate solutions and
technologies (e.g., the type of required
migration/inversion techniques) for the expected
drilling challenges are identified. Existing seismic, offset
well data (if available), and other reference information
are analyzed to determine if they are appropriate for the
proposed techniques. Illumination studies are con-
ducted for the key drilling targets. Uncertainty measures
regarding the structures, fault locations, and drilling
hazards are evaluated. This phase ends with a go/no-go
recommendation based on whether project objectives
can be met.
The best possible earth model with all predrill informa-
tion available is constructed in the drilling baseline phase.
This model serves as the starting point for while-drilling
updates in the next phase. The drilling baseline earth
model includes an anisotropic local velocity model, a
depth-migrated high-resolution image, interpreted hori-
zons and faults, and drilling hazard estimates.
The final phase is the while-drilling updates phase. As
the well is being drilled, new local information becomes
available for updating the earth model in the DVI. This
is particularly valuable in an exploration case, where lim-
ited or no nearby offset well data are available.
Updates, including pore pressure and fracture gradi-
ent estimates, are done on a predetermined schedule or
as required. Real-time LWD data (checkshots and logs)
are used for while-drilling updates. Recorded-mode
LWD and intermediate wireline VSPs and logs are used
The panel on the left shows the legacy image that existed prior to the
GoM project. An anisotropic velocity model was built using the offset
well (Well B) data, and seismic data were depth-migrated. The panel
on the right shows the result giving the best possible predrill image
at the baseline stage. There was a significant (>750-ft or 230-m)
depth shift in the new image compared with the legacy image.
In a GoM well (Well C), a primary challenge was to place the
13
5
8-in. casing below a secondary fault. This was necessary for
the hole size requirements in the final well completion. Locating
both primary and secondary faults accurately was deemed crit-
ical. Large uncertainties were expected in the positioning of
events using the existing seismic image. It was important to
improve the velocity model and reimage while drilling to reduce
the positional uncertainty of the fault locations.
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IMPROVING
EXPLORATION SUCCESS
to update the model and the image between bit runs.
Local anisotropic velocity updates are obtained using
reflection tomography with check-
shots and/or well tops used as
constraints so the model is consis-
tent with well data and seismic
information. The structural depth
image is updated by rapid remi-
gration enabled by massively par-
allel computing resources. Recent
developments in algorithms such
as Gaussian packet migration have
further decreased the turnaround
time for these remigrations.
In one example, LWD, check-
shot, and wireline data were
acquired up to the mudline to
complement the offset well for a
good velocity model. Anisotropic
velocity models were created in
several stages by seismic tomogra-
phy where the vertical velocities
were constrained by well data.
The volume for velocity models
included the offset well to ensure
a proper tie to that well in addi-
tion to the new well.
For each updated model, sur-
face seismic data were reimaged
with an updated model during
drilling, enhancing fault location
accuracy to impact drilling and
casing decisions. The desired cas-
ing location was predicted
within +/- 50 ft (15 m). The
prediction was performed using
reimaging performed while the
drill bit was approximately
1,500 ft (458 m) above the
planned casing depth.
Drilling planning and execu-
tion can benefit greatly from an
accurate high-resolution earth
model obtained from seismic
data integrated with well infor-
mation. Using recent develop-
ments in rapid and accurate
imaging technologies and the
availability of new well measure-
ments, SGD allows this earth
model to be regularly updated
while drilling the well, enabling optimum well place-
ment and drilling hazard management.
The panel on the left is the legacy image that existed prior to the GoM project. The panel on
the right is the seismic image after the final update.
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IMPROVING
EXPLORATION SUCCESS
I
ndependent oil and gas companies are an integral ele-
ment of global exploration. From the Gulf of Mexico
(GoM), where independents are the largest sharehold-
ers, and the US shale plays, where smaller E&P compa-
nies continue to lead the way, to the success of UK
companies such as Tullow Oil and Heritage Oil in
Uganda and Cairn Energy in India, independents
are the first movers.
Emerging plays that are proving to be particu-
larly hot areas for independents include the
Albertine Graben in Uganda, the Tano Basin in
Ghana, the Zagros Mountains in Kurdistan, and
new plays in more mature areas, such as the UK
and Norwegian North Sea.
Commercial success rates also continue to
remain steady despite the growing geological
complexities and remoteness of some target
regions. A recent 2010 survey by Richmond
Energy Partners of 27 mid-cap independents
found commercial success rates are approxi-
mately one in three. The same survey found that
these independents generate US $3 in value from
every $1 invested in exploration.
However, despite these successes, the odds still
are stacked against independents compared to
their more deep-pocketed rivals, the E&P majors.
Independents have an understandably lower
resource threshold for exploration and investment
and, with frontier regions ever more complex and
remote, have to invest in new technologies and
take on increased risk in exploration activities.
Furthermore, if proposed US legislation that
will increase offshore liability limits comes into
force, many independents that do not have the
capital to meet new government requirements
will have to turn away from the GoM and focus on new
frontier regions, increasing the competition.
How can risk be better managed for independents in
their oil and gas exploration activities? How can inde-
pendents better define their acreages for potential
licensing?
Seismic
For the majority of independents, 2-D and 3-D seismic
continue to be the technologies of choice, both onshore
and offshore. It is through seismic and the accurate illu-
GGI helps level the playing field
for independents
Independent oil and gas companies today are a major driving force
behind exploration activities.
Phill Houghton, ARKeX
The Albertine Basin is relatively unexplored but has good
hydrocarbon potential. (Images courtesy of ARKeX)
49-52 EXPSUCCESS-arkex_49-52 EXPSUCCESS-arkex 3/23/11 4:58 PM Page 49
50
mination of the subsurface that firm target locations for
drilling can be decided upon.
The cost of untargeted seismic over large areas, how-
ever, can be extremely expensive and logistically chal-
lenging. In areas such as the dense forests of the
Democratic Republic of Congo, the mountains of
Northern Algeria, or in offshore fields where technolo-
gies such as wide-azimuth surveys (requiring as many
as four vessels) are becoming increasingly popular, it
is not practical to rely solely on seismic and the costs,
large-scale infrastructure, lack of targeting, and long
turnaround times that accompany it.
New technologies
It is into this arena that new technologies are emerging
geophysical techniques such as non-seismic data acqui-
sition and geological techniques that focus on the litho-
logical, stratigraphic, and structural elements of target
reservoirs.
One key technology is gravity gradiometry imaging
(GGI), which maps the small density variations in under-
lying rocks by measuring the gradient of the earths
gravity field. GGI provides an increased signal-to-noise
ratio and wider bandwidth than conventional gravity
measurements. In addition, its ability to include offline
or sideways geology in its datasets also can help reduce
the uncertainty in 2-D measurements and provide
enhanced interpolation solutions between sparse acqui-
sition lines.
The non-invasive nature of GGI; its ability to qualify
vast regions quickly, accurately, and cost-effectively; and
the fact that GGI can optimize the design of future seis-
mic surveys are proving particularly attractive to todays
independents.
This optimization of survey planning through GGI
helps independents focus on the most efficient solution
for enhanced illumination and directs the survey toward
the most potentially prospective areas.
GGI in the field
Several independents are using GGI to better focus
timelines, budgets, and future seismic surveys/drilling
programs by generating the best available picture of the
acreage beforehand.
Forent Energy Ltd. is a Calgary-based oil and natural
gas producer pursuing a combination of short-term
heavy oil production growth in Western Canada and
high-reward pioneering exploration opportunities in
Nova Scotia.
The company has used GGI as a cost-effective method
to image the subsurface of its Nova Scotia prospect area,
leading to the more efficient placement of its 2-D seis-
mic lines and also having minimal landowner impact.
Forent is the largest onshore landholder in Nova Sco-
A 3-D perspective view of gravity
gradiometry anomalies exhibits
reef geometries and areal
extents in Nova Scotia.
51
IMPROVING
EXPLORATION SUCCESS
tia, with exploration rights to 1.1 million acres that are prospective for
reef oil in Shubenacadie Basin and shale gas in St. Marys Basin.
On behalf of Forent, ARKeX conducted a high-resolution 340-sq-
mile (890-sq-km) geophysical imaging program in the Shubenacadie
Basin during the second half of 2010, consisting of gravity gradiome-
try as well as magnetic and LiDAR datasets.
The target was the Alton Block, a 740,000-acre petroleum and natu-
ral gas holding that encompasses two oil and gas reef-prone fairways
on the south portion of the block. The area was described by petro-
leum consulting company Sproule Associates in 2008 as having all
the parameters required for a viable petroleum system ... and, if delin-
eated through the proposed geotechnical methods, should provide
medium- to high-risk exploration targets.
The program was designed to identify possible subsurface Gays
River reefal structures that were anticipated to be hydrocarbon-bear-
ing. Interpretation of the GGI data identified more than 16 anom-
alies, demonstrating similar geometries to modern reefs and
exhibiting areal extents resources assessment. These areas will
be delineated further through a 2-D seismic program in 2011.
More than 7,000 miles (11,265 km) away, Tower Resources, a UK-
based independent oil and gas exploration company, has been using
GGI to improve structural definition within a proposed license area in
northwest Uganda along the East African Rift System. Fewer than 200
wells have been drilled to date in the East African Rift System, which
covers an area of 887,880 sq miles (2.3 million sq km), pointing to
much untapped exploration potential.
In Towers case, the GGI data are helping to improve the planning
for a 91- to 122-mile (150- to 200-km) 2-D seismic program to take
place in the next few months by mapping structures in the deeper
part of the basin to improve structural definition and assist in identify-
ing a better developed reservoir section.
The airborne GGI survey took place over the Block EA5 Rhino
Camp Basin, a 1,124-sq-mile (2,941-sq-km) license area at the north-
ern end of the Albertine Graben. The basin is relatively unexplored
but has good hydrocarbon potential, with various analogies to the
other producing basins within the Albertine Graben. Covering the
whole area through seismic, however, would be a challenge, and an
expensive one at that, as it incorporates the Nile River and swamps.
The survey has confirmed the presence of a deep potential source
kitchen as well as previously undefined structures. Towers board
believes that the apparent volume and depth of the kitchen are suffi-
cient to generate enough oil to fill a commercial-sized trap and that
the new target area is sufficiently large and well-defined to contain
recoverable resource potential of more than 100 MMbbl.
The new insight into the geology and high-resolution measure-
ments that GGI has generated will ensure future seismic work for
Tower can be located with greater confidence, with the survey refined
to focus on the most prospective areas.
Whether it is applied to licensing, frontier exploration, mature
plays, or prospect generation or evaluation, GGI is a powerful
de-risking tool and a driving force in independents E&P efforts.
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LAND
SEISMIC
L
and 3-D seismic surveys require hundreds of tons of
state-of-the-art electrical equipment, large crews, and
many vehicles to be distributed over tens to hundreds of
acres of farmland, mountains, factories, and suburbs for
several months. Being too conservative in the survey
design can lead to a significant increase in the distur-
bance and the HSE exposure as well as reducing the
economic rate of return. The goal is to design a fit-for-
purpose survey that ensures the data adequately image
the subsurface and are suitable for reservoir property
prediction while minimizing environmental impact
and cost.
Basic concepts
Seismic surveys are like sonar on steroids. They are
based on recording the time it
takes for sound waves generated
by controlled energy sources, such
as Vibroseis trucks or buried
explosives, to travel through the
subsurface and reflect off geologi-
cal boundaries within the earth
back to the surface.
The seismic energy generated at
each source location (shot-point or
SP) is recorded simultaneously by a
patch of several hundred to several
thousand recording instruments
(receivers or geophones). Take, for
example, the concept of seismic
energy from one SP being
recorded by one receiver. The
energy generated at S travels
through the earth, reflecting from
each geological boundary at the
mid-point (CMP), and recorded at
R. The amplitude of the seismic
energy is recorded every 1 or 2 ms
for up to 10 seconds, and the datas-
tream from each receiver location is called
a trace. The traces from all the receivers are then
grouped to form a shot gather.
A typical survey consists of thousands of shot-points
and thousands of receiver locations. Many source-
receiver combinations have the same mid-point, and the
data can be re-sorted to create a CMP gather.
For many years, 3-D seismic land surveys consisted of a
live patch of six to eight receiver lines due to restricted
equipment capabilities; such a patch requires 1,920
channels. For a shot fired in the center of this narrow
patch, the offsets recorded would be 2,625 ft (800 m) in
the cross-line direction and 9,843 ft (3,000 m) in the in-
line direction, resulting in poor azimuthal coverage for
the larger offsets.
The 19,686-ft by 19,686-ft (6,000-m by 6,000-m) live
patch is the ideal as it provides full azimuthal coverage at
all offsets, but it requires 7,200 channels, stretching the
limits of many contractors.
Land 3-D seismic survey
designed to meet new objectives
When the need for higher channel count and better imaging bumps up against a requirement
for greater environmental stewardship, planning land seismic surveys can be a balancing act.
Jon Cocker, DownUnder GeoSolutions
A three-layer model shows the modeled seismic response. (Images courtesy of DownUnder
GeoSolutions)
53-55 LandSeis-DUG_53-55 LandSeis-DUG 3/23/11 4:58 PM Page 53
54
LAND
SEISMIC
Main steps in survey design
There are four steps in designing
a successful survey. The first step
is to clearly identify the objectives,
restrictions, budget, and timing.
Many questions need to be
answered at this stage.
Are the data used for basic
structural interpretation, ampli-
tude/inversion studies, or reservoir monitoring (4-D)?
What resolution is required? When are the data
required? What is the budget, and is there any flexibil-
ity? Are there any environmental restrictions? Clarity on
these questions allows the survey designer to focus on
the pertinent issues, i.e., will seismic be able to predict
fluid and lithology for the target depth and expected
fluid properties? Does the geological boundary have suf-
ficient reflectivity? What offsets are required?
The second step is to identify the issues in existing
data or acquire test data. Previous seismic surveys in the
area are an invaluable resource to improve understand-
ing of data quality, frequency content, noise issues, etc.,
to aid in the design process. Seismic source and receiver
tests are recommended if no data have been acquired
previously or if significant improvements are required
from the existing data.
Step three is to design the survey. Information such as
previous seismic survey data and reports, velocity pro-
files, well logs, target depth(s), maximum dip, and
expected fluid properties are needed to optimize the
10 main survey design parameters:
1. Source type (explosives, weight drop, or Vibroseis)
Explosives generate the highest data quality and
can be used in even the roughest terrain, but they
require long lead times and can be expensive.
Vibroseis is significantly cheaper in most situations
but offers lower data quality per source point; it
also requires a lot of land to be cleared and can be
used only on relatively flat ground.
2. Receiver type There are many options, but the
decision generally is whether to use single geo-
phones or geophone arrays (multiple geophones
joined together to boost the signal). Large analog
arrays are used when there is significant random or
coherent noise. Arrays also can be created digitally
using single geophones by summing the data dur-
ing the processing stage. This can be preferable
over analog arrays but requires a smaller receiver
interval and hence the ability to record data from
more receivers simultaneously.
3. Maximum offset (source-to-receiver distance)
The velocities and density of the target/subsurface
are used to model the amplitude of the reflection
event versus offset to determine which offsets are
required for imaging and lithology/fluid predic-
tion. The maximum offset required generally is
around 1
1
2 to two times the target depth.
4. Maximum bin size Bin size is chosen to ensure
the wavefield is sampled sufficiently to avoid data
aliasing. It is dependent on the frequency content
of the data, maximum dip, target depth, and veloc-
ity.
5. Source interval This should be no more than
double the maximum in-line bin size.
6. Receiver interval This should be no more than
double the maximum cross-line bin size. It also
needs to be small enough to sufficiently sample
the noise.
7. Source line interval The source line interval
mainly affects the distribution of the smallest off-
sets recorded in each bin. The minimum offset
should be less than the target depth.
8. Receiver line interval As for the source line inter-
A 3-D seismic source and receiver line lay-
out can have two different live receiver
patches. This survey would consist of
21,600 receiver locations and 8,880
source locations that need to be surveyed
and pegged and would require approxi-
mately 600 miles (1,000 km) of track and
890 acres of land to be cleared.
53-55 LandSeis-DUG_53-55 LandSeis-DUG 3/23/11 4:58 PM Page 54
val, the receiver line interval minimum offset
should be less than the target depth.
9. Live patch dimensions This terminology refers to
the length and width of the patch of receivers that
each shot is recorded into. This controls the maxi-
mum offset recorded, offset distribution, azimuthal
sampling, and cross-line fold. The number of
receiver lines in the patch and
receiver line interval need to be
optimized together to ensure the
patch width is at least half the
patch length. The patch size is
limited by the number of
receiver channels available.
10. Migration aperture An extra
fringe of data needs to be
acquired around the target
to capture all the required
information.
Several survey designs that meet
these technical requirements should
be created to enable the cost of
drilling, contractor capabilities, ter-
rain, environmental, and logistical
restrictions to be incorporated into
the tender process.
The final step is to fine-tune the
design to match the geography, infra-
structure, and environmental restric-
tions. Once the basic survey
parameters are finalized, the design
needs to be fine-tuned to ensure that
the planned locations match what is
realistic and sensible. There are many
reasons why a source or receiver point
cannot or should not occupy a pre-
planned location; for example, they
are too close to a well or facility.
Changes also can be made to reduce
impact, i.e., a source line could be
moved to make use of an existing
track or avoid rare flora. High-quality
aerial photos and maps/shape files of
roads, rivers, wells, power lines,
etc., are invaluable at this stage.
Allocating sufficient time and
budget and using a suitably experi-
enced geophysicist to make these deci-
sions and design a fit-for-purpose
survey are critical. Adjusting the
design to maintain the technical
requirements while accounting for
all of the constraints requires
an understanding of how each component
will affect data processing and interpreta-
tion. There needs to be flexibility in the budget to allow
the survey design to deviate from previous designs that
did not meet the objectives.
55
For more
Land Seismic
articles, visit
EPmag.com
53-55 LandSeis-DUG_Layout 1 3/25/11 4:35 PM Page 55
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n 2009, ExxonMobil shot one of the largest land seis-
mic surveys ever conducted. An 82-sq-mile (212-sq-
km) high-effort compressional (P)-wave survey housed a
smaller high-effort 3-D/three-component (3-C) survey,
and within that was a smaller static patch.
Overall, the survey had more than 78,000 live chan-
nels; 890,000 work hours; 18,000 hours of HSE training;
as many as seven helicopters operating at once, complet-
ing 9,279 flights; and as many as 300 people on the
ground driving vehicles that logged more than one mil-
lion miles (1.6 million km).
The questions now are, Did it work? and Was it
worth the time, cost, and effort? ExxonMobil geoscien-
tists took delivery of the P-wave data in January 2011.
They are hesitant to crow too loudly, saying repeatedly,
The jurys still out. But their excitement is palpable.
Piceance Creek
The survey was conducted over part of ExxonMobils
Piceance Creek asset, a field the company has owned for
many years. This asset is a tight gas field that has been
treated routinely as a statistical play. The hope was that a
better understanding of the subsurface might lead to a
more successful drilling program.
If we can do something to increase the odds that an
individual well will be a better producer, then we can
influence the overall statistics of those plays and gain
value, said Dave Johnston, geophysics coordinator for
ExxonMobil Production Co. We put a lot of effort and
money into acquiring this survey, but it will add value to
the field over a very long period of time.
Seismic challenges in the field are numerous. Imaging
the near surface is difficult, the topography is rugged, a
creek valley causes attenuation in the data, and a baking
soda-like material called nacholite creates a scattering
medium that reduces data quality.
To pull off a survey of this magnitude also was difficult
because much of the equipment did not exist. We ini-
tially wanted to do a 44-line rolling spread when we went
out to bid, said John Hefti, geophysical associate for
ExxonMobil Exploration Co. and seismic processing
lead on the Piceance project. But nobody could do it.
He added that it took more than a year to secure the
equipment before the survey could commence.
Finally, the acquisition window was narrow. Global
Geophysical Services crews could not begin until late
July and had to be finished by December. Vibroseis
trucks were restricted to the roads, so helicopters were
required to transport equipment to drill shot holes for
dynamite sources. Additionally, the very noisy environ-
ment due to traffic and facilities and the delicate ecosys-
tem made this not a normal, run-of-the-mill
seismic survey.
P-wave results
Brute stacks from the field were not promis-
ing. Hefti said one data example showed
nothing but noise. We wondered whether
we were actually acquiring any signal at all,
he said.
Working with proprietary ExxonMobil algo-
rithms and those employed by WesternGeco,
56
LAND
SEISMIC
Piceance Creek
pushes the land seismic envelope
A massive survey has resulted in a dataset with many surprises.
Because of rugged terrain, a fleet of seven helicop-
ters was required to transport people and equip-
ment. (Images courtesy of ExxonMobil)
56-59 LandSeis-Exxonmobil_56-59 LandSeis-Exxonmobil 3/23/11 4:58 PM Page 56
which did the data processing, Heftis team spent nine
months removing noise from the data. Its like peeling
back the layers of an onion and removing small bits of
coherent noise in multiple domains so that were not
clobbering it with a hammer and removing signal, Hefti
said. We do this to remove the noise and preserve the
signal and the amplitudes to perform quantitative attrib-
ute analysis and inversion on the gathers and stacks.
It was a lengthy iterative process, but I think we got a
decent product.
So far, the 3-D P-wave prestack time-migrated data is
exhibiting better fault definition, higher seismic fre-
quency, better positioning, and a greater level of strati-
graphic detail at reservoir level than previous data. The
P-wave data has given us a lot more information than we
were originally expecting, Hefti said. Were able to map
out a fault network, and were seeing areas that correlate
to lower pressure and others to more water. Its given us a
lot of insight into whats going on in the field.
Added Johnston, The relationship drawn between the
structural framework of this area and the productivity of
the wells is a key learning, and it could very well affect
how we proceed with the development of the area.
Converted waves
Processing of the converted-wave data currently is under
way. Hefti said originally a three-interval layer stripping
approach was used to analyze azimuthal anisotropy, but
input from interpreters has led the team to adopt a nine-
layer approach that is more geologically accurate. When
we performed this analysis on the prestack data, we went
from something looking random to everything coming
into focus very sharply, he said. To me, this is incredible,
and it reinforces that were on the right track in under-
standing the anisotropy.
He added that where well information indicates frac-
ture direction, the new seismic data agree with those
results.
Naturally the asset team in charge of Piceance is inter-
ested in seeing additional results from this survey. But
Johnston said that it has a research component as well.
Theres a lot of very interesting stuff in there, he said.
I think this will not only be of value to the business for
57
LAND
SEISMIC
ABOVE: Vibroseis trucks could only operate on the roads in the area.
RIGHT: A shot hole is drilled using a heliportable rig.
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LAND
SEISMIC
Processors have worked hard to reduce the noise that dominates the brute stack.
many years but will be a value to research as well. He
added that ExxonMobil Upstream Research Co. invested
considerable money and people into the project and that
effort has been critical to the team.
Another test involved a full nine-component 2-D survey,
where the sources as well as the receivers include the
shear components. This originally was intended to take
place during the 3-D survey acquisition, but several com-
plicating issues prevented further acquisition in a delicate
environmental area. That test finally took place last year,
reacquiring a 2-D line from 2007 that helped design the
2009 3-D survey.
Were evaluating the data as we speak, Hefti said.
That will be another evaluation to see if the future
phases should be acquired with shear wave sources.
Fit for purpose?
Given the sheer scope and cost of the survey and the host
of obstacles posed by the Piceance Creek field, it is possi-
ble to question the rationale behind shooting this survey.
Apparently some within the company questioned it as
well. But Johnston and Hefti stand behind the decision.
This survey might have been overdesigned; its hard to
say, Johnston said. One of the things were investigating
is what level of effort is required in the field. Does inter-
pretation at Piceance really need the high fold and data
density that we acquired in this survey? And even if the
answer is yes, if you go to other parts of the world, you
may not need this level of effort.
On the other hand, Hefti added, I see the industry
as a whole moving toward higher and higher channel
counts as the demand to extract more from seismic data
increases. The high-end interpretation and analysis meth-
ods applied to this dataset require accurate wavefield sam-
pling, and the full-azimuth acquisition method employed
at Piceance provides that level of sampling. Ive never had
a dataset where I could look at a suite of full-azimuth
stacks at high fold, he said. Youre always missing some-
thing, always guessing.
Over all, the survey seems to be paying dividends.
These reservoirs are very complex, Johnston said. You
have to think of them as an entire system. Were not trying
to find an individual sand; were trying to find sand con-
nected to fractures connected to other sands. That system
approach is whats needed to understand how the whole
field is going to respond and how were going to optimize
recovery.
Its a phenomenal dataset.
60
LAND
SEISMIC
F
ollowing the success of shale play exploitation in
North America, interest has spread to the rest of the
world. Rising demand for energy in developing coun-
tries and the quest to diversify suppliers have combined
to intensify the desire to exploit these vast, newly identi-
fied unconventional resources. As shale E&P matures
and spreads, interest is focused more and more on tar-
geted sweet spot drilling rather than the statistical
drilling employed in the early stages of exploitation.
Improving success
In addition to applying the lessons learned, current
techniques need to be improved. Development needs to
be made safer, reducing both the risks involved and the
environmental footprint, by drilling and completing
fewer, more pro-
ductive wells. Also,
duplicating pro-
gram success
from one play to
another is proving
difficult because
shales vary in com-
position, depth,
thickness, perme-
ability, and fracture
characteristics.
Understanding
reservoir quality
and geomechanics
is critical to reduc-
ing costs and maxi-
mizing recovery and financial return on
investment (ROI).
The challenge when choosing the best loca-
tions to drill in shale reservoirs is to identify the
areas of highest total organic content (TOC),
which also will fracture easily to form good flow
networks. At the same time, it is important to
ensure that the fractures will be limited to the
reservoir. With advanced prestack analysis of seis-
mic data, lithological (elastic rock parameters) and geo-
mechanical (rock strength and stress) attributes can be
derived good indicators for TOC and fracturability.
Existing small fractures can aid production as they
provide natural pathways that can be connected to the
well bore, but more intensive natural fracturing could
mean the hydrocarbons already have migrated away.
Detailed geomechanical and lithological models of the
reservoir allow both potential hazards and sweet spots to
be identified so the greatest return on drilling invest-
ment can be achieved.
In todays environment, shale operators would benefit
from customized, comprehensive seismic strategies
designed to optimize resource recovery and to reduce
drilling and production risks. While information from
well bores, well logs, and vertical seismic profile data can
give a detailed view of the reservoir at the well location,
combining this with advanced reservoir analysis from
Geophysical data home in
on sweet spot drilling
Seismic data can be harnessed to optimize shale field production and development.
Jo Firth and Allison Branan, CGGVeritas
A workflow goes from survey evaluation and design
through acquisition and processing to detailed
reservoir analysis to produce map
volumes to identify sweet spots
to drill. (Images courtesy
of CGGVeritas)
60-64 LandSeis-CGGVeritas_60-64 LandSeis-CGGVeritas 3/23/11 4:59 PM Page 60
61
LAND
SEISMIC
seismic data can provide detail between the wells, critical
in these very heterogeneous reservoirs.
CGGVeritas has developed a new workflow to deliver
integrated geophysical solutions offering advanced tech-
nologies and services individually designed for each
project to enhance all stages from exploration to devel-
opment and production of shales. The complete work-
flow recently has been applied to data library surveys
over the Montney and Haynesville shales. Different ele-
ments also have been applied successfully to a number
of proprietary datasets over the major shale plays in
North America. The results of tying the geomechanical
models from these studies with actual gas production
figures will be published in the near future.
Data analysis
The workflow begins with a fundamental understanding
of the target through careful analysis of all available geo-
logical, petrophysical, and geophysical data. This informa-
tion is incorporated into a reservoir model that drives the
survey design and acquisition parameters. Without the
appropriate azimuths, offsets, and receiver/source inter-
vals, it is difficult to extract the necessary lithological, frac-
ture, and geomechanical properties critical for successful
shale drilling programs.
Broad bandwidth, high-density seismic data are ideal
for providing the high spatial and temporal resolution
necessary to define the thin beds and spatial heterogene-
ity of shale reservoirs and create optimal reservoir mod-
els. Wide-azimuth data are required for meaningful
anisotropy analysis, which is critical for stress and fracture
characterization. Once the optimum acquisition parame-
ters have been derived from the survey evaluation and
design studies, experienced crews are available worldwide
to perform the required high-quality acquisition.
Acquisition
Advanced technologies such as point-source-point-
receiver recording and mega-channel-count supercrews
using state-of-the-art equipment and customized Vibroseis
sweeps can provide the broadband data to enhance shale
reservoir characterization. These methods use propri-
etary software to intelligently tailor Vibroseis sweeps to
extend the bandwidth while working within the hydraulic
and mechanical constraints of the vibrator and without
compromising quality or productivity. They can sweep
more than five octaves, making them particularly applica-
ble for high-resolution imaging of shale reservoirs.
Processing
Carefully tailored, reservoir-driven processing flows are
applied to the recorded data, which include advanced
Clearing the way for seismic
By Simon George, The Development Initiative (TDI)
O
peration Desert Storm ended in 1991, but the rem-
nants of that short but intense conflict still persist
throughout the small Gulf state of Kuwait, which saw the
brunt of the fighting. Iraqi troops were well entrenched,
laying more than two million landmines while they occu-
pied the country and as a result drew very intense aer-
ial bombardment from the coalition forces.
Two decades later, seismic acquisition still is con-
ducted on an ongoing basis by the Kuwait Oil Co., which
brings in specialist seismic survey companies to carry
out the search for the significant oil reserves beneath
the Kuwaiti desert floor. The use of vibrator trucks or
controlled detonations presents a significant risk to the
crews if there is unexploded ordnance present.
TDI was deployed to support a leading seismic
acquisition crew operating in the Menagish oil fields in
Kuwait. The area had a former Iraqi minefield running
through it as well as having been subject to numerous
air strikes. Although the minefields were cleared in
1993, the quality of that clearance was in doubt. TDI
carried out further clearance that uncovered six addi-
tional mines.
Successful seismic acquisition programs require
speed with data collection. The TDI clearance assets
were therefore required to structure clearance to main-
tain a healthy gap between the search crews and seismic
crews. This was a task in itself, together with the very
extreme temperatures encountered, regularly exceed-
ing 131F (55C) in the summer months.
Using the technique of Battle Area Clearance, a com-
bination of visual and detector-aided subsurface search,
TDI was able to ensure a 100% accident-free period for
the three years of the contract, during which more than
1,300 items of unexploded ordnance were discovered
and neutralized.
The search teams formed an extended line and
moved through the seismic corridor. When evidence of
a cluster strike was found, the teams broke out their
detectors and carried out a subsurface search, ensuring
that only the high-threat areas were searched.
The minefields were recleared using mine-detecting
dogs operating with specialist handlers. Any positive
indications given by the dogs were then investigated
by TDI deminers, who uncovered six mines from
cleared areas.
62
algorithms such as Gabor deconvolution for increased
resolution and 5-D interpolation to provide fully popu-
lated common-offset vector volumes. Geomechanical
properties are derived from careful measurements of
azimuthal anisotropy. Therefore, an amplitude versus
offset and azimuth-compliant processing flow is
required. Depth imaging is preferable as it avoids any
anisotropy in the overburden being imprinted onto the
reservoir, and it provides more reliable amplitudes.
Important lithological and geo-
mechanical attributes can be
derived from seismic gathers by
inverting the data for compres-
sional- and shear-wave velocities
and density, including Youngs modulus, Poissons ratio,
and shear modulus. Azimuthal anisotropy analyses pro-
vide information about the existing fractures, while
simultaneous prestack azimuthal elastic inversion
enables estimates of the various stress fields, such as
hoop stress, closure stress, and differential horizontal
stress ratio, to be produced. Understanding the stress
characteristics provides hydraulic fracturing details,
including whether fractures will form, remain open, and
Straightforward maps, identifying good
(green) and bad (red) areas to drill,
can be produced by carefully combin-
ing all the elements of the detailed
lithological and geomechanical
reservoir models.
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be limited to the desired zone. The fracture initiation
pressure provides information on how much propant
and pressure will be required to create the fractures.
Reservoir modeling
Advanced reservoir modeling to provide detailed litho-
logical and geomechanical models is the final compo-
nent of the workflow, producing a volume that combines
all of the derived attributes to identify the sweet spots
and to predict well flow rates. This detailed reservoir
modeling gives engineers a broader understanding of
the entire field, enabling the development of more cost-
effective drilling programs that incorporate information
about directions to drill, locations of zones of interest,
and recommendations for fracture stimulation to
achieve the most profitable and environmentally sound
production rates.
Microseismic services for monitoring the frac process,
using purpose-designed surface layouts and in-field real-
time processing, also are of use. Interpretation of these
data allows seamless in-field adjustments based on frac-
ture direction, orientation, and penetration in and out
of zones of interest to optimize fracing operations. Inter-
preted data also can be used to validate and refine geo-
mechanical reservoir models. Staying within zone and
using the minimum frac stages and fluids to achieve the
desired well flow can make the difference between a
positive and a negative ROI.
The best lithological and geomechanical attributes
are derived from seismic surveys designed to specifically
target the reservoir and acquired and processed with
this in mind. Detailed reservoir models derived from
advanced integrated seismic analysis provide the infor-
mation engineers need to design the most productive
drilling and completion projects and therefore maxi-
mize ROI while minimizing the environmental foot-
print. Integrating microseismic data to fine-tune the
geomechanical reservoir models derived from seismic
technologies is providing key insights for effective explo-
ration and development of unconventional reservoirs
and the foundation for the move from statistical drilling
to targeted, sweet-spot production.
LAND
SEISMIC
Unconventional Resources and the Role of Technology
OM? D
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T
ypical shale reservoirs in the US, such as the Hay-
nesville, Eagle Ford, Marcellus, and Woodford shale
systems, are being drilled and completed using horizon-
tal well drilling technology and hydraulic stimulation
methods. This exposes large surface areas of the source
rock to highly permeable connectors that deliver hydro-
carbons to the well bore.
As a result, the shale story has two parts: horizontal
well construction and hydraulic stimulation that con-
tacts the rock. Many practitioners in the field tend to
treat the two parts as individual problems to be solved,
but more and more people are beginning to realize that
the two are intimately connected, and both can have a
significant impact on production.
Current practice
Typical geosteering practice in shale applications is to
use a low-cost drilling and evaluation system for well
placement. This usually consists of a mud motor, direc-
tional sensor, and gamma ray sensor. The objective is to
place the well within a predefined section of stratigra-
phy by comparing the gamma log from the well being
drilled to an offset or type log. Where markers correlate,
the stratigraphic position of the well is known.
The quality of the correlation depends on many fac-
tors. A common issue is the signal-to-noise ratio of the
sensor being used; a very noisy gamma log, for example,
is very difficult to use for correlation. Borehole washout,
along with mud properties, also can have a significant
negative effect on the ability to correlate.
Another major issue in geosteering applications is what
happens when a fault is crossed. Often, small faults are not
detected on the gamma log, and it is not until a substan-
tial portion of the well has been drilled outside the target
zone that there is a realization that a fault has been
encountered. A drawback of any correlation system is that
the well must be traversing through the section, either up
or down stratigraphically, to build a profile to correlate
against the type log. This means that if the wrong decision
65
Geosteering in unconventional shale
reservoirs has potential
As North American shale development continually evolves, operators must determine if there
is an agreement between final production results and gamma ray stratigraphy.
Jason Pitcher, Halliburton
DIRECTIONAL
DRILLING
A typical total vertical depth (TVD) correlation of a vertical well log (left) is compared to a TVD log from a horizontal well (right).
(Images courtesy of Halliburton)
65-68 Drill-HAL_Layout 1 3/24/11 11:28 AM Page 65
Shale
C? Limestone
_ Sandstone
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------- - -
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Navigator
SERIES
DRILLING IN THE RIGHT DIRECTION
67
is made about which way to correct after a fault, a much
longer section could be drilled out of the target zone.
A recent internal study by Halliburtons Sperry
Drilling business line revealed approximately 50% of
wells geosteered using the conventional gamma ray
geosteering methods within an area of the Haynesville
were misplaced for more than 50% of their lateral
length. This was determined by using chemostrati-
graphic geochemical analysis, which is very effective at
determining the stratigraphic position of a well bore.
Even with a good gamma ray correlation, results often
are ambiguous, and the position of the well in the for-
mation is uncertain, leading to misplaced wells.
When looking at the complete system of well construc-
tion and stimulation, it must be determined whether
placing the well within a specific piece of shale guaran-
tees good production results. In other words, is there an
agreement between final production results and gamma
ray stratigraphy? Many operators do not believe there is.
Even operators that are getting good results now are ask-
ing what more can be done on the well-construction
side to improve productivity, pushing down the ultimate
cost per unit production.
Future possibilities
Basic criteria for producing hydrocarbons from shales are
total organic carbon (TOC) content, thermal maturity,
and the stimulation potential of the rock. From a well-
placement perspective, it is possible to steer according to
TOC, but this usually is well-distributed in the shale in
which a horizontal well is placed. Thermal maturity usu-
ally is a function of the play and is determined well ahead
of horizontal drilling. Neither of these properties is signif-
icant in terms of where the well is placed within a target
interval. A typical target can be 30 ft (9 m) thick and have
ample TOC in the sequence and the desired thermal
maturity. This leaves stimulation potential as the desired
property affecting well placement.
A lot of work has been done from the stimulation side
on examining rocks for stimulation potential. Brittle-
ness, derived from the ratio between Youngs modulus
and Poissions ratio of the rock, is one property that is
recognized as being significant to stimulation potential.
The amount of layering around the well bore also can
be a significant factor affecting the ability to stimulate
the rock. Natural fracture systems play a part in some
reservoir systems as well.
The key to unlocking the potential of these plays is
to determine which particular property has the most
significant impact on the ability to stimulate for better
production. Once this property has been identified,
the necessary tools can be deployed to measure the
property not only after the well has been drilled and
before stimulation but also in real time to assist in well
placement. Deriving real-time brittleness and layering
from sonic LWD measurements and making steering
decisions based on that data could be the game-changer
for operators struggling to realize the full potential of
their assets.
The value of using a simple targeted suite, such as a
gamma/sonic suite, is realized not only through better
well placement in more suitable rock for stimulation
but also in bridging the gap from well construction to
stimulation. Deciding where and how to run multiple
stages in a number of stages becomes a question of good
practice based on hard data rather than a scattergun
approach based on the notion that any frac is a good
frac. While many operators now are leaning toward a
stimulation model with many closely spaced stimulation
points, using hard data to ensure optimal placement of
the stimulation points has not yet become common
practice.
As shale plays continue to evolve, the value of better
well placement will become more apparent, with
focused measurement systems that not only better posi-
tion the well for stimulation but also allow for better
stimulation placement and design. Such an approach
can lead to better returns on capital spending in the
form of more production of hydrocarbons per dollar,
which is the ultimate metric for operators.
DIRECTIONAL
DRILLING
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Targeted suites, such as a gamma/sonic suite, can provide better well placement in rock better suited for stimulation and can bridge
the gap between well construction and completion.
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T
he Permian Basin of West Texas and New Mexico is a
prolific area of brownfield hydrocarbon reservoirs. It
comprises several component basins, of which the Mid-
land Basin is the largest and the Delaware Basin the sec-
ond largest. The Delaware Basin contains the Bone Spring
formation, which has been producing oil and gas for
decades. This heterogeneous formation, composed of
interbedded sandstones, carbonates, and shales, has
enjoyed several cycles of E&P attention.
Conventional-quality sandstones were the first targets.
High-rate wells were then brought in from carbonate
lenses, followed by a spate of vertical drilling in low-perme-
ability sandstones. Horizontal drilling now is tapping accu-
mulations in thin sand formations, shales, and other tight
facies. There were more than 30 rigs working in the Bone
Spring formation during 2010, targeting intervals includ-
ing the Avalon shale; Leonard shale; and the 1st, 2nd, and
3rd Bone Spring sand reservoirs.
Developing the Bone Spring sands
Anadarko Petroleum Corp. has been particularly active in
the 3rd Bone Spring sand, a sand-silt sequence which,
although possibly eolian in source, was deposited in rela-
tively deep water. As many as eight separate reservoir sand
units, typically ranging from 6 to 12 ft (2 to 4 m) in thick-
ness, historically were bypassed because of lack of produc-
tion in vertical wells. To produce economically, these beds
require maximum reservoir contact from a horizontal well
path within a single thin layer and then stimulation to
commingle the multiple reservoir layers.
Initially, the curve and lateral sections were drilled with
mud motors and geosteering decisions based on standard
MWD gamma ray measurement. Initially, it took 72 days to
drill the well from spud to rig release. For maximum
wellbore contact within these thin reservoirs, distinct log
responses across the reservoir are needed for lateral corre-
lations and well trajectory steering. Along with many
reservoirs in the Permian Basin, the Bone Spring sands
commonly exhibit low reservoir bed-to-boundary resistivity
contrasts (usually as low as a 2-ohm difference), with few,
if any, features within the bed that standard gamma ray
measurements can differentiate. This has frequently
resulted in the well bore steering out of zone, often requir-
ing openhole sidetracks or long out-of-zone intervals to
re-enter the reservoir.
69
Bed boundary mapping technology
improves success
Rotary steerable systems combined with deep azimuthal measurements
are keeping horizontal wells within the pay zone of thin, low-resistivity contrast reservoirs
of the Bone Spring formation.
Dan Geary, Gavin Fluke, Jeff DeJarnett, Callie Brehm,
Kara Syvertsen, Marc Russell, Kit Clark, and
Demola Soyinka, Anadarko Petroleum Corp.;
Jeffrey Kok, Eric Vauter, Chad McMillan, and
John Taylor, PathFinder, a Schlumberger company;
Judd Tudor, April Wisebaker,
and Stephanie Chow, Schlumberger
DIRECTIONAL
DRILLING
The Delaware Basin lies in West Texas and New Mexico.
(Images courtesy of Schlumberger)
69-71 Drill-SLB_69-71 Drill-SLB 3/23/11 4:59 PM Page 69
Vertical sections of Bone Spring wells encounter
hard abrasive rocks and are prone to deviation from
the intended trajectory while drilling. Anadarko has
fine-tuned its drilling processes and bit selection method-
ology to deliver time- and cost-effective solutions for the
well-construction phase. The company recognized that
by using a rotary steerable system (RSS), it could acceler-
ate drilling in lateral sections. It outsourced this phase of
well construction to a specialized drilling contractor,
including deployment of the Schlumberger PowerDrive
X5 RSS.
Deep azimuthal resistivity measurements
To improve horizontal drilling efficiency, Schlumberger
applied its deep azimuthal electromagnetic resistivity
LWD system, called the PeriScope bed boundary mapper.
This tool makes 360-degree deep directional measure-
ments that can indicate the distance to and orientation of
formation boundaries 21 ft (6.4 m) from the borehole
using a combination of tilted coil technology and multi-
ple frequencies and spacings.
During drilling operations, LWD measurements are
transmitted in real time to the surface. These unique sym-
metrized directional measurements, with maximum sensi-
tivity to formation or fluid boundaries, make it possible to
map boundaries in real time, independent of anisotropy
and dip. Real-time bed mapping and curve interpretation
are performed by expert well-placement engineers with
proprietary geosteering software called real-time geosteer-
ing software (RTGS). The system helps to place laterals
accurately within thin target reservoirs, reducing the
potential for costly sidetracks and improving drilling
efficiency and lateral exposure in zone for optimum
completion and production.
Beyond technology
Close collaboration among drillers, engineers, geol-
ogists, and other geoscientists within Anadarko and
the service company has been a key contributor to
success, along with consistency within the team.
Drilling engineers and other crew members have
been dedicated to the project for long periods of
time, enabling them to share and build expertise
and learn from experience.
Schlumberger drilling engineering experts have
provided 24/7 support for operations, from devel-
oping initial well plans to preparing post-project
reports. These experts were both local i.e., Okla-
homa City, Okla., and Midland, Texas and around
the world. All team members have been able to
share data through the InterACT secure connectiv-
ity, collaboration, and information system irrespective of
their location.
Dedicated operations support has helped to drive con-
tinuous improvement in drilling efficiency through
improved processes and identifying the most fit-for-pur-
pose technology. Several benefits have been realized
through changes to bottomhole assembly components,
such as identifying drill bits that are more resistant to
abrasion in this particular geological environment.
Bed boundary mapper azimuthal measurements,
combined with the use of an RSS in the lateral, have
enabled wells to be placed accurately within thin target
sand layers that differ significantly from prognoses. To
date, more than 97% in-zone has been achieved from all
laterals drilled, with no sidetracks required.
Growing experience in the Bone Spring area has led to
the identification of an optimized drilling target window
within some sand units. Drilling within this window
helped mitigate high shock and vibration to the tool
string, allowing the operator to optimize drilling mechan-
ics and improve drilling ROP, maximizing efficiency.
Prior to deploying RSSs and bed boundary mapping
technology, wells could take more than 70 days from spud
to rig release. Using the technology to steer in-zone, this
quickly dropped to around 51 days and has continued to
improve. Best composite time targets have been chal-
lenged and reduced for
subsequent wells. The
latest record for spud to
rig release of a well was
24.25 days.
70
DIRECTIONAL
DRILLING
Boundary detection based on azimuthal resistivity curves was used to
generate the boundary mapping PeriScope inversion canvas with RTGS.
Note the flat resistivity and gamma ray response across the target inter-
val and also the difference between planned and drilled trajectories.
EPmag.com
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72
SUBSEA
TECHNOLOGY
G
as in the riser presents a significant challenge to con-
ventional deepwater drilling operations. Once above
the subsea BOP, a gas influx is an immediate and poten-
tially uncontrollable threat to personnel, the environ-
ment, the rig, and even the well.
For this reason, the first indication of a gas influx on a
deepwater well usually initiates an expensive, time-con-
suming mitigation process that typically involves weight-
ing-up the mud system and implementing BOP
procedures.
This best-practice well-control response commonly is
undertaken with imprecise information about the nature
of the kick because it is driven by an urgent need to stop
the influx and prevent the gas from rising in the well bore.
And the step is not without its own risk. In a narrow drilling
window, heavier fluid can reverse the balance from mitigat-
ing the kick to initiating a loss. Cycles of kicks and losses
are a common yet costly problem. If these measures are
applied in the reservoir section, heavier mud also can
increase skin damage and impair potential production.
To break this reactive well-control dilemma and signifi-
cantly reduce the risk posed by riser gas, managed pres-
sure drilling (MPD) methods are being used to precisely
measure and manage small downhole pressure fluctua-
tions before they become a well-control event. Central to
this capability is the growing sophistication of rotating
control device (RCD) technology designed specifically for
the unique challenges of riser applications.
Riser integration
The latest advance in MPD riser technology is the indus-
trys first RCD to be integrated with the riser below the
water line. It also is the first RCD to conform to API
16RCD drill-through specifications.
Installed for the first time on a drillship in Indonesia,
the MPD system successfully provided early kick detection
in difficult carbonate formations where kick-loss problems
are common. Gas influxes were detected at volumes of
only a couple of barrels, and well pressure
was managed while drilling, making con-
nections, and tripping. In addition, the
MPD system acquired formation pressures
in real time and allowed logs to be run in a
safe, controlled manner.
Drilling methods were transitioned easily
to apply the most appropriate approach to
specific wellbore conditions. The upper
part of the carbonate section was drilled
using constant bottomhole pressure (BHP)
MPD methods to manage pressures within
a narrow drilling window. When the win-
dow closed and losses to natural fractures
became total, a shift was made to pressur-
ized mud cap MPD.
To create an MPD system aboard the
drillship, a Model 7875 below-tension-ring
SeaShield RCD was installed in the MPD
riser joint on the top of the upper annular
preventer approximately 140 ft (43 m)
below the sea level surface.
It is not the first time MPD operations have been imple-
mented aboard a floating structure, but all previous RCD
installations have been above the water line and tension
ring. The first MPD application from a floater was per-
Managing the threat of riser gas
MPD advances are taming an old adversary
by measuring and managing downhole gas influxes.
Andrew Barry, Weatherford International Ltd.
The Model 7875 below-tension-ring RCD was installed on a deepwater well offshore
Indonesia so the operator could fully enclose the well bore and all drilling fluids in a
closed loop and employ advanced drilling techniques without compromising the
rigs heave compensation. (Images courtesy of Weatherford International Ltd.)
72-73 Subsea-weatherford_72-73 Subsea-weatherford 3/23/11 4:59 PM Page 72
73
SUBSEA
TECHNOLOGY
formed by Weatherford International
Ltd. in 2004 using a Model 7100 RCD
designed for surface applications.
The integration of the RCD with the
riser is a significant advance in RCD
technology.
Because it is made up below the ten-
sion ring, no modifications are required
to the risers telescoping slip joint or the
rigs mud returns system. With the system
in place, drilling operations can shift eas-
ily between either conventional or MPD
drilling methods.
Many design changes were made to
address riser applications. Location is key
to these changes. While surface RCD
designs sit atop the BOP and thus require
only a bottom flange to bolt them to the
stack, integration with the riser requires
the RCD to be connected at the bottom
and the top. Location also creates chal-
lenges for installing, maintaining, and
operating the RCD far below the rig floor
where conditions make it dangerous and
difficult to deploy personnel.
The riser RCD addresses this issue with a number of
innovations. Among them, the system has a hydraulic
latching system for changing bearing and sealing elements
without the need for personnel in the moonpool area. A
bearing assembly running tool and ancillary equipment
facilitate rig floor positioning and removal. A subsea-rated
hydraulic stab plate is used to make hydraulic and electri-
cal connections below the water line, and the multiport
connections speed the deployment and makeup of
hydraulic and electrical lines and eliminate multiple con-
trol cables.
Managing micro-fluxes
Measuring and managing downhole pressure fluctuations
are core capabilities of MPD methodologies. In a closed-
loop MPD circulating system, micro-fluxes in BHP are
identified immediately in small increments. Conversely, a
little annular pressure applied at the surface is conveyed
rapidly to the bottom of the hole, changing equivalent cir-
culating density without altering the mud system.
This takes place with the rigs BOP and mud manage-
ment systems in place and ready to take over should a
well-control event occur. MPD operations are not a replace-
ment for well-control methods. Rather, they provide an
early warning and management capability that stands in
front of traditional well-control methods to reduce their
use and better inform their application.
In doing so, MPD reduces the threat
posed by riser gas in several ways. It pro-
vides a highly sensitive instrument for
identifying an influx and the means to
manage it. This greatly reduces the risk of
an influx escalating into a well-control
event. If necessary, the gas influx can be
managed, circulated out of the hole
through the riser and flow spool, and
diverted away from the rig floor.
Even when drilling conventionally, the
riser-gas handling capabilities of the sys-
tem remain functional. Should gas enter
the riser, circulation is stopped, and the
surface and subsea annular BOPs are
closed to contain the gas in the riser.
Either the MPD or rig manifold can be
used to circulate the gas out in a con-
trolled manner. And should an event
occur that calls for well control, MPD
measurements enable a much more
informed and timely decision.
RCD basics
The defining MPD technology is the RCD. Its ability to
contain and direct annular fluids and gas is what creates
the closed-loop circulating system that is the basis for MPD
methodologies. The devices development path spans
decades and a scope of applications from basic land opera-
tions to drillships and marine risers.
Those pioneering efforts ultimately evolved into the
mature set of MPD methodologies being used for offshore
exploration and development drilling.
These systems employ a set of tools that includes RCDs,
flow metering technologies, drilling choke manifolds, and
downhole isolation valves. The MPD components are inte-
grated by software that monitors, analyzes, and manages
wellbore pressure. A key aspect of this MPD advance has
been the growing sophistication of the RCD. The chal-
lenges of deepwater drilling have resulted in the next
major evolution of RCD design and MPD application.
The most recent advance integrates the RCD in the riser
system. By eliminating modifications to the rig system or
interference with conventional operations, the new below-
tension-ring riser RCD
addresses many deepwater
issues, including the safety,
environmental, and opera-
tional challenges presented by
riser gas.
If a gas influx ascends above the BOP
and enters the riser, the SeaShield
marine series, including the Model
7875 below-tension-ring RCD, enables
the operator to contain and bleed off
the gas, minimizing potential risks.
EPmag.com
READ MORE ONLINE
There is more
to the story
72-73 Subsea-weatherford_72-73 Subsea-weatherford 3/23/11 4:59 PM Page 73
R
isers and flowlines are integral components of subsea
developments. The design of these components
requires extensive analysis that involves taking into
account a complex set of interacting gravity and hydro-
static and dynamic effects in addition to considerations
regarding the response of the materials of these compo-
nents and their interaction with the seafloor. The use of
numerical, in particular finite element (FE)-based analysis
tools, in designing these components is essential.
PIP flowlines, SCRs
Designing pipe-in-pipe (PIP) flowlines and steel catenary
risers (SCRs) requires engineers to consider effects such
as the interaction between unbonded nested pipes and
assessing necessary pretension of the inner pipe to allevi-
ate adverse effects of locked-in compression after pipelay
is complete.
Interaction between inner (carrier) and outer (jacket)
pipes of an unbonded PIP flowline or SCR is complex and
requires specifying axial (e.g., friction characteristics) and
radial (e.g., relative movement) contact characterization.
This is modeled in Abaqus using the ITT elements. Mod-
eling the contact between the inner and outer sets of
pipes introduces a great level of nonlinearity to the model
and adds computational cost. However, FE analysis that
uses such advanced techniques is essential to assessing
required pretension of the inner pipe so that the final
locked-in compressive stresses are acceptable.
Pipelines for the Arctic
Designing pipelines and risers for arctic conditions intro-
duces challenges, such as ice-loading modeling, ice-goug-
ing and/or permafrost thawing, and frost heave. Several
codes have been developed during the last two decades
that have addressed ice modeling and loading, including
API RP 2N, IEC and, most recently, ISO/DIS 19906. These
codes provide ice static and dynamic loading characteriza-
tion on common structural shapes and sizes.
Ice-loading modeling in numerical schemes (e.g., FE) has
developed over the years, yet it still encounters challenges.
Different material models have been shown to suit various
applications, depending on the type of ice
under consideration, size of the loaded
area, and expected level of stress and rate
of loading. For example, elasticity has been
adequate for solid/consolidated ice under
low levels of stresses and relatively rapid
loading, unconsolidated ice under higher
levels of stress can be better modeled as a
plastic material, low loading causes ice to
behave in a viscous manner, and damaged
elasticity has been successful in describing
internal damage of the ice due to brittle
cracking.
Ice gouging is a natural phenomenon during which a
large floating ice mass gouges the seabed, threatening the
integrity of subsea structures and pipelines. Modeling the
impact of the phenomenon on these structures is challeng-
ing as it involves a number of complex interactions, namely
between the aero- and hydrodynamic forces and ice mass,
between the ice mass and seabed, and between the seabed
and subsea structures. Analysis tools based on state-of-the-
art 3-D continuum FE, which ensures highest accuracy in
the simulation, have proven critical to accurate and realis-
tic pipeline assessment subject to such events.
A pipeline buried in the permafrost can be subject to
overstress if the pipeline degrades the integrity of the per-
mafrost by warming and thawing it. Depending on proper-
ties of the frozen soil, thawed permafrost could collapse
and subject the pipeline to excessive deflection and strains.
Simulating this process and the impact on the pipeline
involves multiple physical processes, including heat trans-
fer, soil consolidation, and soil-pipeline interaction.
Dynamic design tools increase safety
Advanced finite element analysis tools facilitate offshore risers and flowlines design,
help operators anticipate the effects of any dynamic scenario,
and prepare for it in the design phase.
Ayman Eltaher, Wood Group, MCS Kenny
Analysis tools based on state-of-the-art 3-D continuum FE, which ensures highest accuracy
in the simulation, have proven critical to accurate and realistic pipeline assessment sub-
ject to such events. (Images courtesy of Wood Group, MCS Kenny)
74
SUBSEA
TECHNOLOGY
74-76 Subsea-Wood_74-76 Subsea-Wood 3/23/11 4:59 PM Page 74
75
Pipelines for HP/HT conditions
Designing a pipeline for HP/HT conditions should
account for thermal expansion and degradation of mate-
rial properties because of elevated temperature as well as
possible upheaval and/or lateral buckling due to both
high temperature and high pressure. The concept of
effective forces and true stresses should be clear and
addressed correctly. Also, accounting for the behavior of
the inner and outer pipes of a PIP configuration usually
necessitates modeling the two pipes and complex interac-
tion between them. Interaction between the pipeline and
seabed also should be accounted for, particularly the soil
resistance to pipeline movement and resulting buildup of
compressive forces.
Pipeline-soil interaction is one of the more complex and
less established aspects of the process; a number of joint
industry projects (JIPs) have addressed the issue. User-
defined subroutines have been used to implement recom-
mendations of these JIPs to model the pipeline-soil
interaction in both upheaval and lateral buckling as well
as potential axial movement (e.g., walking).
Components of pipelines, risers
Besides pipes, pipelines and risers incorporate a number
of components that work as connecting points between
different parts of the pipeline/riser system and at the
boundaries of the system. Components include flanges,
bulkheads, load-shares, tapered stress joints, flex joints,
and bend stiffeners. These usually are complex and can
involve parts connected loosely, by way of bolts, and can
move relative to one another. This makes the analysis par-
ticularly involved and requires numerical simulation of
nonlinear behaviors, such as contact between surfaces,
friction and sliding, and bolted connections. Analyzing
such components using FE analysis requires advanced
techniques of solid modeling, nonlinear material model-
ing, and contact, which usually entails significant degrees
of nonlinearity and demand for computational power and
proper engineering judgment.
Jumpers
Designing jumpers requires considering numerous static
and dynamic effects. Static and quasi-static loads include
gravity, current, and waves; dynamic loads include flow-
induced vibration (FIV) and vortex-induced vibration
(VIV). VIV for simple-shaped jumpers usually is analyzed
using code-based equations, whereas VIV of complex-
shaped (e.g., multiplanar) jumpers and FIV normally
require numerical analysis such as computational fluid
dynamic (CFD), which simulates induced turbulent flow
and vortices and resulting vibration of the jumper.
Pipeline, SCR seabed interaction
Proper modeling of the SCR touchdown zone (TDZ) is
essential to realistic assessment of the fatigue life of that
structure. However, the SCR TDZ modeling also is chal-
lenging, as it requires modeling the highly complex
response of the soft seabed and potential forming of a
trench in the seabed over time.
A number of simplified models have been developed for
implementation in global SCR analysis; however, these
models usually are limited to specific ranges of soil types
and SCR pipe parameters. Currently, new FE techniques
(such as coupled Eulerian Lagrangian, or CEL, FE analy-
sis) are used to model the response of the SCR when inter-
acting with the seabed for better understanding of that
interaction and then simplifying it for global analysis of
the SCR.
MCS Kenny has developed CEL models to simulate
pipeline interaction with the seabed, including the impact
of mud flow on pipeline and the response of pipeline to
lateral and upheaval buckling.
CEL models simulate pipeline interaction with the seabed,
including the impact of mud flow on pipeline and the response
of pipeline to lateral and upheaval buckling.
SUBSEA
TECHNOLOGY
VIV of complex-shaped (e.g.,
multiplanar) jumpers and FIV
normally require numerical
analysis such as CFD.
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xtreme water depths and low reservoir pressures
of the Perdido development in the Gulf of Mexico
(GoM) were particularly challenging for the engineer-
ing teams faced with tying multiple subsea completions
and lifting the production stream 8,000 ft (2,439 m)
from the seafloor to the production facility. It was obvi-
ous that natural formation pressure was insufficient to
deliver the production liquids to the surface
and that some form of artificial lift would be
required.
According to Dusty Gilyard, senior comple-
tions engineer at Shell, who has been working
on Perdido since the projects inception, Shell
considered several types of artificial lift, but
ultimately decided electrical submersible
pumping (ESP) systems were the best proven
technology with a track record of reliable
operations.
Shell looked at two major suppliers,
Gilyard said. Baker Hughes was selected
because it had a proven track record with
capable technology and the best system to
support it.
In January 2006, Shell awarded Baker
Hughes Inc. contracts for seabed production
boosting systems at two deepwater subsea proj-
ects: BC-10 offshore Brazil and Perdido in the
GoM. Perdido is the first development in the
GoM to use ESP systems in seabed vertical
booster stations.
Unique, purpose-built
ESP systems designed
ESP booster systems offer several advantages
over alternative methods, including deploy-
ment from vessels of opportunity, redundant
designs to maximize run time, and configura-
tions that use existing infrastructure to house
the ESP systems. These features provide oper-
ators economic solutions to maximize production from
subsea fields.
Shell contracted Baker Hughes to provide five Cen-
trilift XP enhanced-run-life ESP systems as well as engi-
neering design, qualification, and testing services. Each
system installation included a liquid/gas separator to
maximize ESP system performance. The vertical booster
stations were designed to handle production from three
subsea satellite fields tied back to the Perdido spar host
facility.
77
Deepwater production technology
gets a boost
Facing technical challenges akin to the first moon landing, Shell attacked
a low-pressure reservoir in 8,000 ft water depth.
Jeff Knight and Ryan Semple, Baker Hughes Inc.
SUBSEA
TECHNOLOGY
The Perdido spar, in approximately
8,000 ft (2,439 m) water depth in
Alaminos Canyon Block 857, is the
GoMs deepest water production
facility. (Image courtesy of Shell)
77-82 Subsea-BakerHughes_77-82 Subsea-BakerHughes 3/23/11 4:59 PM Page 77
78
The 1,600-hp ESP systems were
to be installed in five 350-ft (107-
m) long caissons connected
directly to the platforms top-
tensioned production risers.
Three have been installed, and
the remaining two will be in place
by the end of 2011. The caissons
lie directly beneath the spar pro-
duction facility. Each caisson is
equipped with cylindrical-cyclonic
gas separation systems to separate
natural gas entrained in the fluids
before the fluids enter the ESP
system.
Each pumping system can
deliver between 10,000 and 30,000
b/d of liquid. For this application,
the pumps were designed for
approximately 20,000 b/d. If all
five systems run at nominal flow
rate, the platform can deliver
about 100,000 b/d of production.
The ESP systems also control the
spar riser head pressures.
In the case of Perdido, the wells
would not naturally flow to sur-
face, so we needed something that
would handle the boost and was
extremely reliable, Gilyard said.
We plan to pump 100,000 b/d of
oil, and unless all five pumps are
working, were not going to make
our goal. We needed the caisson
on the ocean floor so the wells
could flow to it and we could
pump the fluid to surface.
Design pushes the limits
Before installation on Perdido, adjustments to the sys-
tems were necessary to meet the requirements of the
deepwater development. Both Shell and Baker Hughes
conducted extensive research to design ESP systems for
this application.
Early in the project, Baker Hughes was involved in
pre-engineering for this unique application. The ESP
system design had to take into account all of the possi-
ble pumping scenarios at Perdido. Much of the applica-
tion engineering work was done to ensure the best
possible design to match the required operating condi-
tions. Technology planning considered varying potential
operating conditions such as
required boost pressures and
flow rates all while consider-
ing a multitude of fluid com-
positions since production
fluids from each well would
be commingled at the ESP
systems.
More than 200 scenarios
were modeled to determine
the system that would work
best in the application.
Shells front-end engineering
requirements included thor-
ough qualification testing of
the new designs. Because of
the unique challenges of this
installation, the companies
worked together to define
the expected demands on
the ESP systems while also
reviewing the run life and
history of the technology.
Design details were validated
on components as specific as
the type of elastomer used
on a seal.
The most critical aspect
was the functionality of the
ESP system, Gilyard said. It
needed to work in any type of
environment.
The ESP was put in a
subsea separator system
and tested for operability
using different monitoring
functions and level control
methods. We considered
combinations of multiple
temperature and flow rates. The pump had to be able
to work both mechanically and electronically without
any gauge interference.
Some enhancements were developed to meet the run
life expectations of the project. One of these was chang-
ing the configurations of the seal section to include an
extra chamber. A standard seal configuration for this
size of equipment has two chambers, but a third was
added for redundancy. Two seal sections were run in
tandem, providing six chambers.
Another new technology development was the thrust
bearing in the seal. Based on the application review, it
SUBSEA
TECHNOLOGY
Inside the caissons are 1,600-hp Centrilift XP ESP sys-
tems that boost produced fluid from the seabed to the
spar. (Illustration courtesy of Baker Hughes Inc.)
79
was determined that the existing highest capacity thrust
bearing in the seal was insufficient in some pumping
conditions. A new enhanced high-load thrust bearing
was designed and qualified to account for maximum
pump thrust.
Installation hurdles resolved
The engineering team also designed specialized installa-
tion equipment to meet Shells requirements, including
new tooling to meet the lifting and hoisting standards.
New equipment baskets, lifting subs, and control line
push arms were created as well.
Baker Hughes intelligent production systems (IPS)
group designed new equipment for the project as well,
including special spooling units that deployed the heavy
armored power cable that supplies electricity to the ESP
motors. Normally, 8,500 ft (2,591 m) of cable would be
supplied on two reels and spliced together during instal-
lation. Shell specified that the ESP cable needed to be
on one large reel to avoid switching the reel on the plat-
form. With the help of the IPS group, a heavy-duty
spooling unit that could advance and take up the cable
as it was run was developed along with transportation
frames that could store extra cable or an empty reel.
The project continues
Baker Hughes continues to contribute to the success
of Perdido. By year-end, all of the ESP systems will be
installed in the five vertical subsea boosting stations.
This will be a long-term relationship as the project
switches from installing to sustaining to ensure reliable
operation of the production systems. Over time, as pro-
duction increases, the two companies will collaborate to
maximize the performance of the systems and optimize
production.
The project was an important learning experience
for everyone involved. The technology developed for
Perdido and BC-10, along with the lessons learned from
working together as a cohesive team, have advanced sub-
sea development capabilities for the entire industry.
For more
Subsea Technology
articles, visit
EPmag.com
d to the life of
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hale oil drilling is picking up in the Williston Basins
Bakken shale, one of the hottest oil plays in North
America.
The Bakken, which extends through North Dakota
and eastern Montana in the US and into Saskatchewan
and southwestern Manitoba in Canada, produced
225,000 b/d of oil in 2010, up from 3,000 b/d in 2005,
according to the Energy Information Administration
(EIA). Current EIA predictions indicate the Bakken
could produce 350,000 b/d of oil by 2035. Most analysts
think that estimate is too low.
Scott Sheffield, head of Pioneer Natural Resources
Co., estimates new technology will allow the US to pro-
duce an additional 2 MMbbl/d of oil from the Bakken
and other shale oil plays. Its going to have a major
impact on the United States reducing imports,
Sheffield said at IHS CERAs CERAWeek in March 2011
in Houston.
Guy Caruso, former head of the EIA and currently an
advisor at the Center for Strategic and International
Studies, agrees. If we get 2 MMbbl/d, that could have a
major impact on world oil prices, he told CERAWeek
delegates.
Increasing Bakken activity
Over the last five years, leasing in the Bakken has
increased significantly, and bonus payments per acre
also have gone up. According to the US Department
of Energys National Energy Technology Laboratory
(NETL), total lease payments exceeded US $100
million in 2009.
In 2008, the US Geological Survey estimated the US
portion of the Bakken formation contains between 3
and 4.3 Bbbl (a mean of 3.63 Bbbl) of undiscovered,
recoverable oil. The number of producing wells and the
volume of oil production have grown with leasing and
drilling growth. According to the NETL, Bakken pro-
duction has reached approximately 8 MMbbl per month
from nearly 4,500 producing wells.
The Elm Coulee field in Richland County, Mont., is one
of the Bakkens significant emerging fields. Discovered by
Lyco Energy in 2000, the field has produced more than
41 MMbbl of oil and 24 Bcf of gas from more than 400
horizontal wells. It has relatively low porosity (8% to 10%)
and an average of 0.05 md permeability, with natural frac-
turing likely contributing to production.
The reservoir has been developed over an area of 450
sq miles (1,165 sq km), targeting the middle member of
the Bakken formation on 640- and 1,280-acre spacing.
Recovery per well is 350,000 to 600,000 bbl, and ulti-
mate recovery for the field is greater than 200 MMbbl.
The Parshall field, which also produces from the Mid-
BAKKEN SHALE
Basin & Location Information
Basin Williston
Location US: North Dakota, Montana
Canada: Saskatchewan,
Manitoba
Est. basin area 200,000 sq miles
(520,000 sq km)
Reservoir Characteristics
Depth 8,500 to 10,500 ft
(2,591 to 3,200 m)
Net thickness 140 ft (43 m)
Total organic carbon
(TOC), %Ro 6 to 20
Total porosity (%) 5
Economic Data
Original oil-in-place (MMbbl) 5
Gross EUR (Bcfe) 5.1
Gross well cost (USD) $5.5 million
Net EUR (Mboe) 697
2009 production 55.2 MMboe
Oil gravity 42%
Permeability 0.005 to 2 md
EUR 0.5 MMbbl
Source: UGcenter.com
Updated 10/04/2010
UNCONVENTIONAL:
BAKKEN
Ashley E. Organ, Associate Editor;
and Richard Mason, Executive Editor, Online
Bakken activity on the rise
New technologies are increasing recovery, and operators are moving
to delineate areas outside the core Bakken region.
83
83-91 Uncon-Bakken_83-91 Uncon-Bakken 3/23/11 5:00 PM Page 83
84
UNCONVENTIONAL:
BAKKEN
The Williston Basin is host for the Bakken play
the hottest oil play in the US. (Map courtesy of
Hart Energy)
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dle Bakken, was discovered in 2006 on the east side of
the Nessen Anticline. As of April 2010, the field had pro-
duced approximately 32 MMbbl of oil and 13 Bcf of gas
from 228 wells.
According to the NETL, the top 20 players in the
Bakken hold nearly 5.5 million acres of prime acreage,
with the top three controlling more than two million
acres. Continental Resources, the top driller and lease-
holder in the play, has 864,559 net acres. Whiting Oil &
Gas Corp. has 14 rigs operating in the Bakken and
approximately 480,000 net undeveloped acres in the
Bakken/Three Forks. EOG Resources Inc. has 11 rigs
operating and 580,000 net acres.
Developing new technologies
The Bakken is a relatively young play, but companies
working in the area already have helped to make an
impact through new technologies.
In 2009, Continental Resources performed the first
24-hour continuous frac in the North Dakota portion of
the play. In 2010, the company developed the ECO-Pad
drilling concept, a system where multiple horizontal
wells are drilled from a single pad with zero boundary-
line setbacks. The concept can reduce drilling and com-
pletion costs per well by approximately 10%, with
approximately 70% less surface footprint area than four
conventional drilling pads and one access road.
Smith Bits has designed the Spear shale-optimized
steel-body PDC bit, which can drill a curve and long lat-
eral hole section for faster penetration rates in low
hydraulic energy environments, reducing the number of
trips downhole and the associated rig time. According to
the company, the bit also reduces nonproductive time
by minimizing vibration and preventing packed blades,
plugged nozzles, and cutter damage. It permits high
ROP through a combination of tall and thin blades,
which provide a large area for cuttings flow. The
hydraulic design directs flow toward the cutter faces,
keeping them sharp while sweeping cuttings away from
86
UNCONVENTIONAL:
BAKKEN
Results from simultaneous fracture stimulations on three wells in
Montana demonstrate the potential benefits of these enormous
operations, but the logistics are daunting. (Photo courtesy of BJ
Services Co.)
The North Dakota Industrial Commission is projecting another
30 rigs will enter the Williston Basin in 2011 on top of the 170
already in the play. If true, those numbers amount to an 18%
increase and imply an aggregate industry capital program of
US $13 billion on the basis of 2,000 projected wells. (Source:
Four Bakken Themes for 2011 by Richard Mason, courtesy of
UGcenter.com)
Bakken Rig Employment Plans, 2011
Company Current rigs Projected 2011 Change
Continental 23 25 2
Hess 11 18 7
Brigham 7 12 5
Occidental 7 12 5
Oasis 6 7 1
Enerplus 2 5 3
Denbury 2 3 1
QEP 2 3 1
Kodiak 2 3 1
Totals 64 90 26
The top 10 Bakken acreage holders
cover 51% of the plays geographic
footprint. (Source: Hart Energy)
Top Bakken Acreage Holders
Company Acreage
Continental 864,559
Hess 750,000
EOG 600,000
Whiting 552,127
ExxonMobil 450,000
Marathon 391,000
Brigham 365,000
Oasis 303,000
Denbury 275,000
Newfield 271,000
X/
i
IT'S ALMOST MIDNIGHT.
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COMPRESSOR
SYSTEMS, INC.
the bottom of the hole and around the bullet-shaped
body into the annulus.
A more recent milestone occurred in March 2011, when
Baker Hughes Inc. installed a 40-stage openhole comple-
tion system in the Williston Basin, the largest number of
stages ever performed in a single lateral frac sleeve/
packer completion system. The companys FracPoint EX-
C multistage fracturing system was deployed in Whiting
Petroleum Corp.s Smith 14 29XH horizontal well.
The industry continues to push the limits of total frac
stages in horizontal completions in the Bakken shale
and other unconventional reservoirs, said Paul Butero,
president of the US Land region for Baker Hughes.
Reactive element packers allow for a wide range of
openhole sizes and improve the capabilities of packer
and sleeve completions. In many areas of the Williston
Basin, Baker Hughes REPackers are used in the Frac-
Point EX-C system to isolate intervals of a horizontal sec-
tion, while frac sleeves are used to deliver the fracture
treatment. The system extends current capabilities to 40
stages via
1
16-in. incremental changes in ball size to
increase the number of ball seats and provides addi-
tional mechanical support to the ball during pumping
operations.
R&D is key
Developing new technologies specific to the area is a
priority. The National Energy Technology Laboratory
(NETL) has funded a number of R&D projects to improve
recovery, decrease the operating footprint, and enhance
safe and environmentally responsible shale oil develop-
ment. The lab plans to develop and/or refine several key
technologies to exploit the Bakkens full potential.
Further deployment of microseismic fracture monitor-
ing will provide a greater understanding of fracture prop-
agation and extent in the Bakken system, resulting in
better frac jobs and enhanced production. MicroSeismic
Inc. already has buried seismic arrays across more than
150 sq miles (388 sq km) in Mountrail County, N.D.,
using more than 1,200 geophone channels to monitor,
map, and analyze hydraulic fracturing operations.
Extended-reach and rotary steerable drilling also are
key to developing the Bakken. Without extended later-
als and multistage hydraulic fracturing techniques,
Bakken development would be uneconomical. With lat-
erals now extending beyond 10,000 ft (3,048 m), precise
well placement control is crucial, as is the ability to
deliver a smooth well bore to enable single-trip fractur-
ing and completion equipment installation.
The NETL also is investing in enhanced multistage
fracturing to increase the ability to pump larger multi-
stage fracs to improve economics. And projects in the
works will target water use as well. Typical water use for
hydraulic fracturing in the Bakken is 1.5 to 4 million gal
per well. Surface water in the Williston Basin is in short
supply, and costs associated with acquiring frac water
and disposing of flowback and produced water can
range from $2 to $11.75/bbl.
The NETL continues to fund R&D projects that will
lead to more efficient oil recovery and improved envi-
ronmental impact.
Additional M&A likely
By Richard Mason, Executive Editor, Online
A
fter the US $3.6 billion acquisition flurry that
characterized 4Q 2010, the Bakken still remains
a candidate for additional mergers and acquisitions
(M&A). Recent deals include Hess Corp., which
increased its holdings to 750,000 net acres follow-
ing the $385 million acquisition of American Oil and
Gas Inc. in July 2010, and the $1.1 billion acquisition
of Tracker Minerals in December 2010. Also, Occi-
dental Petroleum Corp. picked up Anschutz Corp.s
Bakken acreage for $1.4 billion in December 2010,
while Williams Cos. entered the play with the $925
million purchase of Dakota-3 E&P in the same
month.
Other recent acquisitions include Kodiak Oil and
Gas, which acquired acreage for $110 million from
an undisclosed seller, and Oasis Petroleum, which
picked up acreage in Montana and North Dakota in
two separate transactions totaling $78 million.
In all, there were more than three dozen acquisi-
tions in 2010, and deal-making should continue at a
respectable pace in 2011 as private operators
remain open to an exit strategy after acquiring
acreage and proving up planned development unit
potentials or existing players look for bolt-on acqui-
sitions in neighboring parcels.
While the number of public operators willing to
pay $1 billion for Bakken acreage is limited to all
but the largest oil and gas operators, independents
such as Brigham Exploration Co. face daunting cap-
ital requirements to fully exploit holdings and fre-
quently prove attractive for larger companies with
large-scale project management skills the perfect
candidates to pursue Bakken acquisitions as full-
scale resource development gets under way.
UNCONVENTIONAL:
BAKKEN
88
It
'
s the Little Things.
Let btatUon name au of your naKKen weusite aetaus
,
so your crew can
1 spend its ti i
;i
n
fs
h =
t matter most.
Accommodations . Solids control . Construction and communications services . Lots of little things on
the wellsite can distract your crew and take the focus away from the well itself-and the bi g picture.
Stallion Oilfield Services takes care of all these tertiary services , including:
Onshore Workforce Accommodations Remote Communications
Surface Rental Equipment Solids Control
Wellsite Construction Drilling Support
In the Bakken and beyond , when you want to sleep better knowing
Stall ion Oilfield Services
wi l'
. handle the details of your next well,
call Corporate Sales at (713) 528-5544.
www.staywettf ocused.co
H7
M
83-91 Uncon-Bakken_83-91 Uncon-Bakken 3/23/11 5:00 PM Page 90 83-91 Uncon-Bakken_83-91 Uncon-Bakken 3/23/11 5:00 PM Page 91
Eagle Ford Update Global Shales NGLs Permian Basin 2011 Forecasts
DEVELOP INGUNCONVENTIONALGAS
6th
Annual Conference and Exhibition
April 18-20, 2011 Fort Worth Convention Center Fort Worth , Texas
rhe
D
p
i
Chesapeake
E N E R G Y
Weatherford
'
NEWPARK
DRILLING FLUIDS
Sponsored by:
HALLIBURTON
p II
NETN ERLAND , SEWELL
0. ASS OCI ATES, INC.
Tripoint LLC
TUDORPICKLRING SELECT
HOLT&CO eA
ENERGY SERVI CES
011 T o o l s
4&M
BAKER
ENC,u INVes TmrrNT S L.P.
HUGHES
U. S. Steel
Tubular Products Tenaris
L
EXPRO
"
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:EIG
GLOBAL ENERGY PARTNERS
Stallion
a
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TGS ?
drilling fir
e r e
BASIC
OBENERGY SERVI CES
Keynote Speakers Include:
Richard K. Stoneburner
President and COO
Petrohawk Energy
Bobby Tudor
Chairman and CEO
Tudor. Pickering , Holt & Co. LLC
Statoil
q
PETROHAWK
ENERGY CORPOR477ON
SUPERIOR
GE Oil & Gas Holland
SERVICES
GeoGraphix
Macquarie Tnstone
Clariant Oil Services
Olivier Lazare
Vice President . New Business Development
Shell Exploration & Production
Schlumberger
NATIONAL OILWELL VARCO
M
Cordillera
Clariant
st
FiCo
MAGNUM
O I L - T O O L S
I" L. UAI G RA L
4FRAC
TECH
MicroSeismic
T
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TEXAS CAPITAL BANK-
press
Presented by:
LG
Invest or
L
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H A R T E N E R G Y
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I LE
CASE HOLE
, L IONS
W
hen conventional, manually operated riser-han-
dling tools appeared incapable of fully supporting
a particular drilling riser system, it was time to go back
to the drawing board.
In response to a clients need, Claxton Engineering
Services Ltd. initiated an intense in-house development
program to create an innovative hydraulic tool. The
resulting design eliminates the need for scaffolding
and manual handling and offers protection to the
very expensive associated riser connector. It also can
cut rig time and costs.
Need for innovation
The limitations of the conventional heavy-duty seg-
mented handling tool became apparent on this project
when it could not hold the required internal pressure
when attaching to the 18-in., 49-ft (15-m) NT-2 tension
joint. After exhausting all of the options, including
changing the construction material and altering the seg-
ment design, engineers concluded that the clients
requirements could not be met with the existing design.
A new approach clearly was needed.
The engineering team set about re-engineering the
conventional riser-handling tool.
Over the course of the ensuing
10 months, they designed,
manufactured, and tested a
new multipurpose,
hydraulically actuated run-
ning tool through a
process that
involved
internal and client design reviews and third-party
approval. Manufacturing and mechanical completion
activities were in accordance with the Norwegian petro-
leum industrys NORSOK standards.
This tool not only met the needs of the immediate
application, but it also overcame the shortcomings of
the manually operated variant. For one thing, the con-
ventional tool requires the erection of scaffolding to
reach the NT-2 joint. This adds time to the operation
and introduces safety risks from the potential for
dropped objects. Another shortcoming of the manual
tool is that operating the tool is time-consuming because
each of the 12 segments has to be manually secured
onto the tools housing using a threaded stud and nut,
which are tightened using a standard torque package.
Incorporating hydraulics into riser handling
In contrast, the new tools hydraulic operation means
riser handling can be much quicker. Scaffolding does
not need to be erected, and the tool hydraulically locks
itself onto the NT-2 joint in seconds. A crucial step for-
ward in terms of safety is that because the tool is
hydraulically actuated, it can be operated remotely by
means of a dedicated combined hydraulic power unit
and reel, which reduces the risk of harm to personnel.
In its first real-world application, a Norwegian drilling
operator used the tool to run and remotely pressure-test
three 6,019-psi (415-bar) full riser systems. The tool cut
4.5 hours of rig time from each run and decreased the
project costs by US $2.9 million.
The tool now is available as part of Claxtons strategy
of continuing improvements in efficiency and safety.
The tools key features include its ability to:
Perform a wellbore pressure test to 7,000 psi while
holding the tension at 308 metric tons (flanged and
quick-connect systems are available to 12,200 psi);
Act as a contingency method for applying 400 metric
tons of tension to the drilling riser
system before BOP installation (with
no internal bore pressure);
Interface with either a Grayloc
192 or 196 gasket seal profiled,
New tool makes riser handling
faster and safer
An innovative hydraulic riser-handling tool provides a means of fully supporting
a drilling riser system during installation and recovery.
Blair McKnight, Claxton Engineering Services Ltd.
Claxtons innovative hydraulic riser-handling
tool provides a means of fully supporting a drilling
riser system during installation and recovery.
(Images courtesy of Claxton Engineering Services Ltd.)
92
RISER
TECHNOLOGY
92-93 Riser-Claxton_92-93 Riser-Claxton 3/23/11 5:00 PM Page 92
RISER
TECHNOLOGY
93
18-in., 49-ft NT-2 pin by means of a removable adap-
tor housing the seal elements; and
Lift a drilling riser tension joint weighing up to 20
metric tons and measuring up to approximately 39 ft
(12 m).
The tools vital safety features include visual indicator
rods that show whether the tool is locked or unlocked and
a manual override feature to lock and unlock the tool.
The Claxton tool is 11.5 ft (3.52 m) long, has a maxi-
mum OD of 45 in., and weighs 5.1 metric tons. It is
DNV approved and is verified in accordance with DNV-
OS-E101 and API 16F, 6A, 8C, and 7G. The tool is sup-
plied as a complete package with a DNV-2.7-1-certified
container for transportation and storage and a com-
bined ATEX-approved hydraulic power unit and umbili-
cal reel to power all functions.
Operational advantages
An important feature of the new tool is that it offers pro-
tection for the NT-2 riser connector. This expensive
piece of hardware is at risk of being damaged by the
riser when the crane is moving it. The key element of an
NT-2 connection is the seal profile located at the top.
When the tool is installed on the NT-2 joint, this seal
region cannot be accessed because the tool envelops it
and prevents damage through mishandling or from
dropped objects.
The new tool also helps to safeguard against weather
window issues, as it can apply tension if sea conditions
worsen during the installation process. In such a situation,
a manual tool could not operate to 400 metric tons with-
out a specially designed tool mandrel and, more critically,
could not maintain tension while being highly pressur-
ized. This is not an issue with the new tool because it has
been specifically designed to meet these parameters.
Designers also have eliminated some of the opera-
tional use restrictions. For instance, the manual version
requires over-the-side scaffolding work, which cannot be
undertaken at night on some rigs. The hydraulic riser-
handling tool has no such operational restrictions and
therefore does not impact decisions regarding when to
run or pull the riser system during a drilling campaign.
Slimline tension rings
Further benefits can be realized from using a Claxton
slimline tension ring, especially when more than one
slot is being drilled at a given time and there is a need
to hop the riser from one slot to the next. At some
point, the tension joint needs to be pulled through the
rotary table. By design, the slimline tension ring does
not need to be removed to enable the tension joint to
pass through the rotary table, therefore saving rig time.
The tension joint can then be rerun through the rotary
table to make further time savings.
The design
of the new hydraulic riser-
handling tool eliminates the need
for scaffolding and manual handling and offers
protection to the very expensive associated riser connector.
NOMADS 2011 OTC Cocktail Party
Monday, May 2nd 5-7 pm
Reliant Center Caf on the Park
(Adjacent to International Visitors Lounge - 2nd Floor)
Tickets still at the bargain price of
$40 each
NOMADS is also
looking for Sponsors for this event.
Phone: 281-462-0139 Fax: 281-462-8022
Email: wandab123@comcast.net
All credit cards accepted Sponsorships welcome!
Platinum: $2,500
or above
Gold: $2,000
Silver: $1,000
Bronze: $500
92-93 Riser-Claxton_92-93 Riser-Claxton 3/23/11 5:00 PM Page 93
NOMADS
National Oil- Equipment
Manufacturers and Delegates Society
Z h
O 4
M P
B
end stiffeners are a common sight on many offshore
platforms, where they are used to reduce wear and
fatigue in flexible risers and umbilicals. Installing bend
stiffeners can be a time-consuming and hazardous busi-
ness, especially when divers are involved in securing the
bend stiffener connection.
One way around the problem is to use the type of
diverless bend stiffener connector (DBSC) developed by
First Subsea Ltd. The companys latest development is
an ROV-less bend stiffener connector designed specifi-
cally for risers in crowded production environments and
installations in the splash zone.
Bend stiffener connections
Flexible risers either connected to a subsea riser base or
the turret exit of a floating production vessel, for exam-
ple, are subject to dynamic environmental loads that
cause the riser to flex around a fixed location. This
movement, in combination with large axial loads, can
cause damage to the riser structure due to overbending
and fatigue. Bend stiffeners mitigate this damage by pro-
viding localized stiffness to the flowline and limiting
bending stresses and curvature to acceptable levels.
Typically a bend stiffener is a conically shaped
polyurethane molding. Up to 39 ft (12 m) in length
and weighing in excess of five metric tons (11 kips),
each bend stiffener comprises a conical external
profile, cylindrical tip section, and smooth bore to
suit the external diameter of the riser.
First Subseas DBSC technology, developed in collabo-
ration with bend stiffener manufacturer Trelleborg
Offshore, enables a fully integrated DBSC design that
maximizes the engineering performance of both the
stiffener and connector elements.
Connector technology
Unlike other bend stiffener connection technologies,
which use external locking mechanisms and hydraulic
pressure to hold the bend stiffener in place, the DBSC
uses a ball and taper type connection. The male connec-
tor is inserted within a female receptacle or I/J tube. As
the male connectors balls roll up the receptacles wall,
tapers drive the balls outward. The tightness of the grip
increases in direct proportion to the load applied. The
connector is self-aligning and self-energizing, enabling it
to be fitted and secured in position without the need for
divers. This approach makes the installation safer and
quicker.
The DBSC employs the same connection principle
used with First Subseas ball and taper-based subsea
mooring connectors. Developed and deployed in more
than 200 deepwater mooring systems worldwide, the
mooring connector is subjected to typical minimum
breaking loads of 17,998 kN (4,046 kips).
The DBSCs ball and taper connection is manufactured
from precision-machined forged materials and uses super
duplex balls to optimize the connectors strength and
resilience. To protect the connector from corrosion in
Riser bend stiffener connections
prepare to go ROV-less
New approach eliminates divers and ROVs for safer and faster installation.
Brian Green, First Subsea Ltd.
The Type II DBSC is being installed on the Neptune LNG project
approximately 10 miles (16 km) off the coast of Gloucester,
Mass. (Images courtesy of First Subsea Ltd.)
94
RISER
TECHNOLOGY
94-95 Riser-FirstSubsea_94-95 Riser-FirstSubsea 3/23/11 5:00 PM Page 94
95
the splash zone, the DBSC has a thermally sprayed alu-
minum (TSA) coating. Independent testing has shown
that TSA performs better than electronickel plating or
fluoropolymer coating. Anodic protection also can be
used to complement any corrosion protection system in
place within the connecting I/J tube.
Although the concept of the DBSCs connection is rela-
tively simple, the connector is optimized for each project
with respect to the bending moments and load path
analysis, system finite element analysis, and fatigue analy-
sis. In addition, 3-D modeling of the complete connector
enables the production of bending moment and shear
stress studies.
Installation loads
The key engineering challenge in developing the DBSC
has been the pull-in load experienced during connec-
tion. In-house testing has been conducted to determine
the pull-in loads at different angles and various loads,
replicating the loads likely to be experienced by the
DBSC in the field.
While pulling the DBSC into the I/J tube side/angled,
loads are induced due to the tension in the risers and the
angle of the riser. Pull-in loads for the DBSC vary for dif-
ferent inclined angles and side/angled loads. It has been
shown that for an angle of 10 degrees or less, the required
pull-in load is less than the side/angled load. For angles
between 10 and 15 degrees, however, the pull-in load
exceeds the side/angled load by a small factor. Even
so, the loads experienced are well within the range of
expected installation loads for these operations offshore.
In general, the larger the riser diameter, the smaller
the available pull-in angle. The pull-in angle also is
dependent upon the type of DBSC used.
DBSC connections
The first DBSCs were designed to allow the connector to
be fitted within an existing I/J tube and bellmouth dur-
ing tieback to an existing facility. The Type I used an
ROV hot stab hydraulic clamp to activate and lock the
connectors balls in position and meet the DBSCs
torque requirements, preventing the bend stiffener
from rotating through the I/J tube.
For newbuild projects, a two part (male/female) con-
nection or Type II DBSC was developed, enabling a full
ball and taper connection with a smaller footprint where
space is limited. As both elements of the connection are
manufactured to designed tolerances, this allows for a
simpler compact connector. This DBSC is intended for
installations where the pre-machined female receptacle is
fixed to the I or J tube during the structural fabrica-
tion stage of a floating production, storage, and offload-
ing (FPSO) vessel or buoy. The Type II DBSC is designed
to release the end fitting once the male DBSC has
engaged within the female receptacle. Unlike the Type I,
the Type II connection is used only during installation.
Once installed, it does not require a hydraulic locking
mechanism or clamp to hold it in position.
ROV-less DBSC installation
Both the Type I and Type II release DBSC require some
level of ROV intervention.
The latest DBSC development is an ROV-less Type II
for crowded turrets or buoys on platforms and FPSOs
where space is either limited or in shallow-water, splash
zone environments where ROV installation is impractical.
The new Type II DBSC uses an automatic release clamp
(ARC) self-latching disconnection system attached to the
riser end fitting, which, once engaged with the female
receptacle, uses a system of rubber springs to maintain
the pre-load on the male connectors ball configuration
and dogs to release the end fitting from the DBSC.
The ARC design addresses the problem of the weak
link experienced with some bend stiffener connectors
where the shear-pin breaks ahead of complete installation.
This design also addresses situations where the shear pin is
too strong, which can cause the connector to be over-
pulled, leading to installation problems. The ARC DBSC
connector uses an integrated pull-in head locking mecha-
nism that automatically de-latches when it is fully con-
nected, which eliminates the need for
ROV intervention during the installation.
Recent testing of the ARC has demon-
strated the connectors viability as a
practical solution to the ROV-less instal-
lation of risers.
The new Type II DBSC features an automated release clamp.
Recent testing of the ARC has demonstrated the connectors
viability as a practical solution to ROV-less installation.
For more
Riser Technology
articles, visit
EPmag.com
94-95 Riser-FirstSubsea_94-95 Riser-FirstSubsea 3/23/11 5:00 PM Page 95
T
he buzz words among oil and gas exploration
companies around the world are shale plays.
From Argentina and Brazil in South America to the
US and Canada in North America to Poland, England,
and Germany in Europe to China and India in Asia
and elsewhere, shale plays are ubiquitous and attractive
reservoirs with immense economical potential for oil
and gas discoveries.
Many shale plays are expansive mild geologic struc-
tures that make the discovery process a relatively simple
one. Explorationists in the US have commented that
seismic is not necessary to find oil and gas in these
unconventional shale plays just drill anywhere and
you will find pay. Be that as it may, finding deposits and
successfully exploiting and producing them are two dif-
ferent things.
The importance of fractures
A critical ingredient in the successful exploitation and
production of these prospects is understanding whether
the reservoir is fractured. The orientation and density of
fractures play an important role in the drilling and pro-
duction strategy to follow. Several questions are asked. Is
it best to drill horizontally? How do we design the most
effective borehole trajectory to maximize production? Do
we need to do hydraulic fracturing? How many frac stages
are needed? How will the rock formation fracture?
The traditional way to answer some of these questions
depended on the study of shear waves and the phenome-
non observed in these waves called shear wave splitting
or birefringence (also known as double refraction).
When shear waves pass through a fractured
(anisotropic) medium, they split into two polarized
shear waves that travel at different speeds and orient
themselves with the fractures. The fast waves orient
themselves parallel to the fractures, while the slow ones
become perpendicular to them. By carefully measuring
the orientation and speed of the arriving signal, it is pos-
sible to determine fracture density and orientation in
the reservoir.
Shear (and converted) wave acquisition and process-
ing are expensive and difficult and not yet part of main-
stream seismic processing, especially when compared to
compressional (P)
data processing. Is
there a simpler and
less expensive way
to detect fractures
by using conven-
tional P-wave pro-
cessing? What
could replace this
shear wave splitting
phenomenon? The
answer is the newly
developed concept
of offset vector tile
processing for
wide-azimuth data.
The two neces-
sary ingredients for
this technology to
work are a well-sam-
pled wide-azimuth
A specific workflow is needed to construct FracMaps and schematics of the OVT migration. (Images courtesy
of Geotrace)
Fractures detected
without shear waves
A new technique provides fracture information at a much lower cost.
Jaime A. Stein, Geotrace
96
tech
WATCH
96-99 TechWatch-Geotrace_96-99 TechWatch-Geotrace 3/23/11 5:00 PM Page 96
97
acquisition and a wide-azimuthal seismic processing sys-
tem that includes an orthorhombic migration and veloc-
ity analysis.
It has been documented elsewhere that if seismic data
are acquired with good azimuthal coverage such that
reservoirs can be illuminated from different directions,
enough information can be elucidated from the behavior
of the compressional waves traveling through the rocks in
different directions to help determine the orientation
(and perhaps the density) of the fractures.
Similarly to the shear wave splitting effect,
the compressional waves travel at different
speeds, depending on whether they are mov-
ing along (fast) or against (slow) the frac-
tures. Furthermore, it is possible to measure
the propagation velocities of these compres-
sional waves in different directions and
determine the fracture orientation.
This new technology can be used to deter-
mine fracture orientation. It is based on the
use of offset vector tiles (OVT), orthorhom-
bic prestack time migration, and careful
analysis of the generated offset migrated
gathers (OMG).
OVT, orthorhombic migrations, OMG
When good azimuthal coverage exists in a
seismic survey, it is possible to construct
(minimal) datasets or OVTs that preserve
the azimuthal and offset information after
migration. When these OVTs are migrated,
they generate OMGs. OMGs are the vector
generalization of the traditional migrated
gathers. They represent the subsurface
as seen by different offsets
from different directions
(azimuths). If the velocity
and anisotropy models are
correct, these gathers should
be flat. The deviation from
flatness indicates the pres-
ence of an incorrect velocity,
probably due to anisotropy
in the vertical and horizon-
tal directions.
In traditional migrated
gathers, vertical anisotropy (VTI) expresses itself as
hockey sticks in the offset domain, requiring the intro-
duction of an anisotropic
correction into the migration traditionally called (eta) .
The analysis of OMGs immediately demands the
introduction of additional anisotropic corrections on
top of VTI. The two parameters chosen are the horizon-
tal propagation velocities in two different directions,
referred to as V
H
fast
and V
H
slow
. The combined presence
An OMG is sorted into offset and
azimuth displaying VT and HTI
anisotropy.
A velocity ellipsoid describes orthorhombic anisotropy. There is one of these for
every point and sample.
tech
WATCH
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99
of horizontal anisotropy (HTI) and VTI anisotropy is
orthorhombic anisotropy. It can be argued that this
orthorhombic anisotropy is pervasive to the earth as it
describes the natural symmetry (or lack thereof) occur-
ring in a vertical depositional flat-layer environment that
undergoes fracturing at a later stage.
Through a process called a surface-fitting algorithm, it
is possible to find these velocities. One way to visualize
these new corrections together with VTI is as a 3-D
velocity ellipsoid with different sized semi-major and
semi-minor axes and with different orientations. Every
point in the survey has a tetrad of values (V
v
, V
H
fast
, V
H
slow
;
and ) describing such an ellipsoid.
By selecting the orientation and the semi-major axis
magnitude, it is possible to construct a simple represen-
tation of the anisotropy, called a FracMap. A time slice
across one of these volumes shows a formation of direc-
tional patterns that can be interpreted as fractures.
Waves move fast along this direction and slow perpendi-
cular to them, hence the connection to fractures.
This velocity vector is used to determine fracture orien-
tation in a reservoir and presents an attractive alternative
to shear wave splitting. Although shear waves can produce
similar information, the ease of processing wide-azimuth
P-waves by well-known and understood techniques makes
this a more desirable processing alternative.
References available.
Zoomed-in FracMap (timeslice) shows fracture orientation and
intensity (thickness of tick mark)
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New PDC bit engi-
neered for shale
A new family of PDC
bits that targets shale
plays has been devel-
oped by Smith Bits.
The Spear shale opti-
mized steel-body PDC
bit addresses the most
persistent challenges
of shale well bit per-
formance steerability
and penetration rate.
The new IDEAS cer-
tified cutting structure
enhances the direc-
tional response of the
bit in both the curve
and lateral hole sec-
tions. Lo-Vibe depth-of-cut control inserts back up the
cutters at the outer blade edges to improve bit life. Built
around a steel body that allows reduced blade width and
increased blade height, the bits feature expanded flow-
by area between the bit body and the borehole wall. The
hydraulically optimized design provides 66% more junk
slot area and boosts face volume by 26% for enhanced
cuttings removal, the company says. Face volume area
also is boosted by 26%. The bits bullet-shaped profile
reduces the opportunity for bit balling and nozzle plug-
ging to improve penetration rates.
Because of the abundance of cuttings generated by
the bit at high penetration rates, hydraulics capability
was boosted using optimized nozzle placement to ade-
quately clean the cutting structure face and avoid issues
with nozzle plugging. Minimizing cuttings beds along
the low side of the lateral is a critical attribute for high
penetration rates, reduced axial and torsional friction,
and maximum effective use of hydromechanical energy
to deliver improved performance over conventional
PDC bits. www.slb.com/spear
New ropes help during subsea mooring failures
Ropes made with DSM Dyneemas ultra-high molecular
weight polyethylene are being used on many facilities in
the offshore oil and gas industry. The company says users
are finding this rope invaluable when original steel wire
rope and chains that secure mooring legs break or suffer
damage.
The backup lines are installed as a safety feature until
regular maintenance can be carried out. The system is
designed to retain the floating production, storage, and
offloading unit in position and to maintain production,
gaining time for the operator to mobilize the required
vessels and equipment to replace the broken wire leg in
case one of the wires fails due to its reduced strength.
www.dyneema.com
Project tracker provides suitable
data management processes
Blueback Reservoir has released the Blueback Project
Tracker plug-in for Petrel, allowing data managers
responsible for maintaining order and structure of the
Petrel project files on various network disks to track and
monitor projects from all of their Petrel users. It is accessi-
ble from outside Petrel and provides extensive informa-
tion about project content and history.
With a powerful and customizable search engine, the
plug-in quickly identifies data inconsistencies and dupli-
cations and references project relations. It also helps to
control and manage large numbers of Petrel projects on
various disks. www.blueback-reservoir.com
System helps mitigate lost-circulation risks
Lost circulation can occur during drilling or primary
cementing procedures, resulting in ineffective mud
removal and poor zonal isolation and increasing the
need for expensive and time-consuming remedial
cementing jobs. The Schlumberger Losseal family of
tech
TRENDS
The Spear drill bit has a sleek pro-
file; thin, high steel blades; and wide
junk slots ideal for shale well drilling.
(Photo courtesy of Smith Bits)
Losseal creates an impermeable seal to cure losses. (Image
courtesy of Schlumberger)
100-102 TechTrends_100-102 TechTrends 3/23/11 5:01 PM Page 100
101
reinforced composite mat pills allows operators to miti-
gate the risk associated with lost-circulation issues
encountered not only while cementing but also while
drilling. The Losseal system combines fibers and solids
into a specifically engineered, flexible fiber additive pill.
The pills use synergy between the physical characteris-
tics of fibers and solids, plugging fractures that cause
partial or total losses while drilling or cementing.
The system also creates an impermeable grid strong
enough to withstand additional pressure from mud
density increases as well as any additional pressure from
future drilling or cementing operations. It reduces
drilling downtime caused by circulation losses while
addressing large losses in fissures, saving thousands of
barrels of mud during placement and reducing nonpro-
ductive time, the company says.
Traditional lost-circulation fiber treatments rely on
knowing the fracture width during bridging and plug-
ging. The combination of fibers with different mechani-
cal properties and high solids content makes the Losseal
system design less sensitive to fracture sizes, with the
solid particle size being optimized to plug the network
of fibers as opposed to the fractures. Plugging-efficiency
tests are conducted prior to the first application. Addi-
tionally, the system can be pumped through most bot-
tomhole assemblies, eliminating the need to pull out
of the hole and run open-ended drillpipe. www.slb.com
Wellbore cleanout product line expands
Bilco Tools Inc. has expanded its wellbore cleanout tool
product line, including Big Boy riser waste retrievers,
which the company says have one of the largest solids
retrieval capacities in the industry. Strong Boy magnet
tools are equipped with powerful, high-temperature mag-
nets to remove ferrous debris from the well bore, and Big
Strong Boy debris trappers are a combo tool featuring the
solids retrieval and ferrous debris trapping capabilities of
the Big Boy waste retriever and Strong Boy magnet tool.
Additional tools in the line include the Swift Boy
jet tool series, the Clean Boy filter basket, Flow Boy
circulating tools, Slim Boy swivel subs, the Swift Boy
circulating tool, and Czech Boy ball type flow check
subs. www.bilcotools.com
Drill-through reaming system
enhances wellbore integrity
Drillers face an increasing demand to run casings to
greater depths and at higher angles. Tools that enable
drilling teams to land downhole assemblies at target
depth the first time can decrease drilling costs. Often
conventional methods are not practical or prudent for
example, the size or length of the casing can make it
impossible to rotate on smaller rigs, and the well path
can prevent rotation.
Deep Casing Tools has launched the first drill-through
tool to ensure casing to target depth, allowing wells to
be drilled as planned and enhancing well integrity. Man-
ufactured as a single body from high-strength steel, the
Turbocaser Express is a rugged downhole tool that can
ream casings through obstructions, is fully HP/HT com-
pliant, and works with any drilling fluid without deterio-
ration in power output, reliability, or performance. After
reaming casing to target depth, the tool can be drilled
through in minutes with standard drill bits after normal
cementing in one operation. www.deepcasingtools.com
Fastener enhances reliability
in extreme temperatures
Spiralocks new self-locking threaded fasteners enhance
reliability by combating vibration, thread loosening, and
extreme temperatures, while easing assembly, mainte-
nance, and inventory management without the need
for secondary locking features.
The thread form adds a 30-degree wedge ramp at the
root of the thread that joins standard 60-degree thread
fasteners. The wedge ramp allows the bolt to spin freely
relative to the threads until tension is created in the fas-
tener. The crests of the standard thread form are drawn
tightly against the wedge ramp, eliminating radial clear-
ances and creating a continuous spiral line contact
along the entire length of the thread engagement. This
continuous line contact improves resistance to vibra-
tional loosening, axial-torsional loading, joint fatigue,
and temperature extremes. www.spiralock.com
Ashley E. Organ, Associate Editor
tech
TRENDS
The Turbocaser Express can ream casings through obstructions,
is fully HP/HT compliant, and works with any drilling fluid.
(Image courtesy of Deep Casing Tools)
IF ONLY LIFE WERE THIS EASY
Covers contacts from all sectors of the oil and gas industry - in
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W
hile the southern coast of Australia continues to
tick over with relatively small but steady activity,
and with New Zealand searching via licensing rounds
offering frontier acreage to inject life into its somewhat
stagnating and already modest oil and gas scene, Aus-
tralias western shore is a totally different story.
Investment upswing
With operators such as Woodside Energy, Chevron,
ExxonMobil, Shell, and BHP Billiton increasingly
focused on either expanding established shallow-water
LNG schemes or developing mostly deepwater mega-
projects offshore Western Australia to meet continually
expanding gas demand particularly from Asia the
result has been a huge upsurge in current and predicted
spending. An estimated US $120 billion has been com-
West coast gas bonanza lights up
Australias offshore future
The west coast of Australia has emerged from the shadows to become a major E&P hotspot for
the offshore oil and gas industry, dominating the Australasian region as both domestic and
international majors sink billions of dollars of investment into several massive LNG projects.
Mark Thomas, International Editor
REGIONAL REPORT:
The Greater Gorgon, Wheatstone, Pluto, and NWS projects are surrounded by a substantial number of established discoveries such as
Scarborough and East Artemis, along with many other smaller discoveries and prospects that will eventually feed future expansions of
the main LNG projects either already established or under development. (Image courtesy of MEO Australia)
103-109 RegionalReport-AustNZ_103-109 RegionalReport-AustNZ 3/23/11 5:01 PM Page 103
104
mitted or is under consideration for these projects.
This newer breed of projects now emerging also is
proving to be as pioneering and challenging technologi-
cally as anywhere else in the world, with floating LNG
(FLNG) solutions, deepwater tension-leg platforms
(TLPs), and long-distance subsea tiebacks to onshore
LNG plants currently either under way or on the draw-
ing board. All of these are leaning on knowledge and
experience gained from the worlds established offshore
basins, with most of the operators and contractors draft-
ing in experienced staff from elsewhere to ensure suffi-
cient knowledge and technology transfer.
This also has lead to significant growth in required
infrastructure and logistical support in and around
Perth, with many manufacturers and service and supply
companies either establishing or expanding their pres-
ence in the area to position themselves for a slice of
what looks set to be a long-term growth market.
Major public investment in recent years in the Aus-
tralian Marine Complex just south of Perth has given
service companies access to common-user infrastruc-
ture, including a recently commissioned $60 million
floating dock measuring 325 ft by 174 ft (99 m by 53 m)
and capable of lifting vessels up to 12,000 metric tons.
This will enable underwater subsea structure treatment,
while a new $35 million service and supply base is being
developed to support offshore projects with a service
wharf to accommodate roll-on/roll-off vessels and a
473,612-sq-ft (44,000-sq-m) staging area.
Development builds on gas
Natural gas has become increasingly important for
Australia, both as a source of export income and as a
domestic energy source. Approximately 50% of the
countrys gas production is exported.
Oil is a different story since Australia is a net importer
of crude. Recent forecasts state that Australian oil pro-
duction between 2010 and 2020 will fall by 29.21%, with
crude volumes peaking in 2013 at 640,000 b/d before
declining to 395,000 b/d by the end of the decade.
REGIONAL REPORT:
\j
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2-5 MAY 2011 == RELIANT PARK e= HOUSTON, TEXAS
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Gas production, how-
ever, is expected to soar
from an estimated 1.77
MMcf in 2010 to possibly
3.88 MMcf by 2020. With
10-year demand growth
domestically of 30.52%,
this means an export
potential rising from an
estimated 812 Mcf to 2.65 MMcf, all expected to be
LNG. Western Australia currently accounts for nearly
9% of global LNG production, but that figure certainly
will rise.
Flagship LNG mega-projects such as the Chevron-
operated $37 billion Greater Gorgon project are leading
the way. One of the largest single-resource investments
in the world, Chevron is partnered by ExxonMobil and
The FLNG design is planned
to be used on the Prelude
field, followed by another on
the Greater Sunrise project.
(Image courtesy of Shell)
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,
oil
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Royal Dutch Shell. The project entails subsea produc-
tion from several shallow and deepwater fields with
reserves of 40 Tcf of gas. Processing facilities will pro-
duce 15 million tons per annum (MMtpa) of LNG for
export and 300 terajoules of gas per day for domestic
consumption.
Jim Blackwell, executive vice president, Technology
and Services, at Chevron, said the Gorgon project plays
a big role. Looking at Gorgon, its the centerpiece of
our growth story. Everything about this project is huge:
resources, production, and infrastructure. The Gorgon
and Io/Jansz gas fields hold more than 40 Tcf of gas, the
equivalent of 7 Bbbl of oil, he said.
Gorgons project workscope covers a three-train 15
MMtpa LNG facility, a domestic gas plant and maximum
production of 2.6 Bcf/d of gas and 20,000 b/d of con-
densate, with startup
expected in 2014.
Our first three trains at
Gorgon are expected to
produce 450,000 boe/d,
Blackwell said, adding that
a final investment decision
(FID) on a fourth train for
Gorgon would be reached
before the end of 2013.
That decision will have
been helped by a string of
10 discoveries made by
Chevron over the past 18
months. At the end of
2010, Chevrons estimated
total resource for the
Greater Gorgon area was
almost 60 Tcf, he added,
with enough potential for a
fifth train for Gorgon.
Chevrons other key
project in the area is its
$23 billion Wheatstone
LNG development. An FID
on Wheatstones first and
second trains is expected
to be made later this year
on what will be a two-train,
8.9 MMtpa LNG facility
planned to start up in 2016
at a forecast rate of
260,000 boe/d.
The project consists of
the development of four
fields Wheatstone, Iago, Brunello, and Julimar via an
offshore processing platform that will pipe raw gas to an
onshore plant.
Chevron says Wheatstone also is well-positioned for a
third LNG train and further expansion.
Another equally active player offshore Western Aus-
tralia is Woodside Energy, which is spending $12 billion
on its Pluto LNG project, while also proceeding with the
estimated $30 billion development of its Browse LNG
scheme, among others. Pluto is the most advanced of all
the schemes under way, with an annual capacity of 4.3
MMtpa and due to come onstream in August 2011.
Much larger is Woodsides estimated $30 billion
Browse LNG development, a world-class project also
entailing one of the largest deepwater schemes in the
market.
106
REGIONAL REPORT:
Western Australias lineup of LNG projects currently under way represents more than $120 billion in
terms of projected expenditure. (Image courtesy of the Department of Mines and Petroleum, Govern-
ment of Western Australia)
107
REGIONAL REPORT:
Browse is a joint venture (JV) of operator Woodside,
BHP Billiton, BP, Chevron, and Shell. Woodside has
described the project as a game changer for the com-
pany, essentially because Browse will double the com-
panys current equity share of LNG production.
The overall project if it receives an FID as planned
mid-2012 will include three TLPs (two initially and the
third in a later phase) in deep water, as well as two
bridge-linked central processing platforms in approxi-
mately 328 ft (100 m) water depth, more than 746 miles
(1,200 km) of subsea pipeline infrastructure, and a
three-train LNG facility 202 miles (325 km) onshore.
The TLPs will process gas and condensate from three
fields in the Browse Basin, starting with the Brecknock
and Calliance fields and then the Torosa field. The fields
are estimated to contain a combined contingent resource
of 13.3 Tcf of dry gas and 360 MMbbl of condensate.
A handful of contracts was issued recently for key parts
of the project. Fluor Corp.s Fluor Offshore Solutions
unit was awarded a front-end engineering and design
(FEED) contract in partnership with McDermott Inter-
national for the central gas processing facility including
steel jackets, a compression platform, and a utilities
accommodation platform. Fluor teamed with McDer-
mott for the steel jackets design and float-over installa-
tion. Work is under way, and completion is expected by
the end of 2011.
The two initial TLP dry-tree units are the subject of
parallel FEED studies being conducted by Aker Solu-
tions and Modec. An engineering, procurement, con-
struction, and installation tender will be submitted
mid-year, with expected contract award by the end of
2011.
Both floating production facilities, which will be con-
figured for subsea tieback to the central processing com-
plex, also will pioneer the first use of TLPs offshore
Australia.
Offshore gas liquefaction otherwise known as FLNG
is a technology that has just barely moved off the draw-
ing board and conceptual studies to become a firm proj-
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ect option, and Western Australia is at
the forefront of its first planned use.
One of its main proponents is Shell
with its plans for the Prelude project,
also in the Browse Basin. The project is
scheduled for an internal FID before the
end of 2011 and would be the worlds
first FLNG facility in action.
The operator currently is in the
FEED phase for the unit, which is being
designed to produce 3.6 MMtpa of
LNG, 400,000 metric tons per year of
liquefied petroleum gas, and 1.3 MMtpa
of condensate. First LNG is expected to
flow by 2016.
Following closely on its heels is
another FLNG project in which Shell is
involved the Woodside-operated Sun-
rise LNG JV. The Greater Sunrise fields,
which straddle the Australian and East
Timorese maritime border, are esti-
mated to hold more than 5 Tcf of gas
and 226 MMbbl of condensate.
The Sunrise JV recently selected a
development concept to produce the
reserves using FLNG technology and
said the project has robust economics.
However, formal government and regu-
latory approvals still are required before
it is considered a firm project.
FLNG technology is set to become an
increasingly employed solution for com-
mercializing remote or stranded gas
reserves, and Australia is primed to
spearhead its use.
More conventional floating oil-pro-
duction projects will continue to be
employed.
Recent examples of smaller yet sub-
stantial floating production develop-
ments include BHP Billitons $2 billion,
96,000 b/d Pyrenees oil field in the
southern Carnarvon Basin and Apache
Energys $700 million, 40,000 b/d Van
Gogh oil field in the Exmouth Basin.
Both began production in early 2010.
In October 2010, Van Gogh was shut in
for unexpected repairs to be carried out
to the Ningaloo floating production,
storage, and offloading (FPSO) unit,
but came back onstream earlier in 2011.
108
REGIONAL REPORT:
More zeal needed for New Zealand
T
he first well of the modern era in New Zealand was drilled in
Taranaki in 1966, but an indicator of this remote island nations
current situation is that oil still is being produced from only one basin.
With annual production in 2008 and 2009 of 55,000 b/d dominated
by output from its Tui, Pohokura, and Maui fields and a domestic con-
sumption figure of 148,000 b/d, the countrys need to grow production
levels and raise current proved reserves of 190 MMbbl is clear.
There have been signs in recent months that things finally could be
starting to change. Bearing in mind recent exploration successes else-
where in the world (and in remote locations), when two major players
like Petrobras and Anadarko Petroleum Corp. quietly slide into an area
for the first time, others should take notice.
According to New Zealands Energy and Resources Minister Gerry
Brownlee, New Zealanders have believed that as a country we are
bereft of natural resources in comparison with places like Australia, he
said. Nothing could be further from the truth.
The reality is that New Zealand has the fourth largest exclusive eco-
nomic zone in the world, with 15 recognized basins that are potentially
capable of producing hydrocarbons. Incredibly, only one basin
Taranaki currently has producing fields.
Brownlee added that the most exciting development in the last year
was the entry of Petrobras and Anadarko into the country.
Petrobras was awarded 100% of exploration permit Block 2 in the
frontier Raukumara Basin, while Anadarko farmed in for 50% of three
permits operated by Origin Energy in the Deepwater Taranaki and
Canterbury basins.
The fact that these two companies have been willing to invest here
has really sent a signal to the rest of the world that New Zealand is
prospective and open for business, Brownlee said.
Few in the upstream industry doubt that the countrys offshore sec-
tor has significant oil and gas potential, especially in its frontier deep-
water zones. A study in 2009 by the Institute of Geological and Nuclear
Sciences estimated there is a 90% chance that reserves totalling 1.9
Bbbl of oil remain in New Zealand, and a 50% chance that there are 6.5
Bbbl. Most of these estimated undiscovered reserves are believed to
be in deep water in the Great South and Deepwater Taranaki basins.
It has been the sheer geographical remoteness of New Zealand that
has held back the progress of its small but robust domestic E&P indus-
try, with many international oil companies reluctant to bear the costs
of shipping equipment to the isolated nation and shipping any oil from
it to faraway refineries.
For many observers, it is the exploration of the countrys frontier
basins by players such as Petrobras and Anadarko, along with
increased use of the latest production optimization and brownfield
technology to extend the life of its existing assets, that holds the key to
its energy future and indicates that the E&P industry is prepared for
the long haul in New Zealand.
109
Operators such as Woodside continue to pick up
reserves around their other existing floating production
projects offshore Western Australia, with the company
considering either a subsea tieback or standalone FPSO
solution for its deepwater Laverda oil discovery (40
MMbbl of recoverable reserves). An FID will be made by
the end of 2011.
While many markets in Southeast Asia are showing
some signs of growth, Australias sector driven by an
explosion in activity offshore its west coast is in the
midst of a transforma-
tion from a province
with potential to a
world-class gas power-
house.
Petrobras quietly stepped into New Zealands frontier deep waters
for the first time in 2010, taking 100% of Block 2 in the Raukumara
Basin offshore North Island. (Image courtesy of Petrobras)
EPmag.com
READ MORE ONLINE
There is more
to the story
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HIGHLIGHTS
Pacific Rim
Petronas hits Sarawak double
Petronas has made oil and gas discoveries with the NC3
and Spaoh-1 wells in blocks SK316 and SK306 offshore
Sarawak, East Malaysia. The NC3 wildcat well was drilled
to a depth of approximately 13,123 ft (4,000 m) below
sea level, and a subsequent appraisal well brought a sig-
nificant discovery in Block SK316 with early estimates of
2.6 Tcf of net gas in place. The Spaoh-1 well was drilled
to approximately 9,843 ft (3,000 m) in Block SK306 and
shows similar promise for both oil and gas. The prelimi-
nary evaluation indicates approximately 100 MMbbl of
oil and 2 Bcf of gas in place.
Gas shows in PNG
Eaglewood Energy Inc. has hit gas in the Ubuntu-1 well
in PPL 259 approximately 11 miles (17 km) east of the
Ketu and Elevala gas condensate discoveries in Papua
New Guinea (PNG).
Oil, gas discovered offshore Vietnam
Japans JX Nippon Oil & Gas Exploration Corp. has
made an oil and gas discovery with the Dai Nga explo-
ration well in blocks 05-1b and 05-1c offshore south
Vietnam. The structure is approximately 9,514 to 11,811
ft (2,900 to 3,600 m) below sea level in 394 ft (120 m)
water depth. Oil and gas accumulations were confirmed
by drillstem tests.
Zola gas discovery
Tap Oil has made a gas discovery with the Zola-1 well in
permit WA-290-P in the Carnarvon Basin offshore West-
ern Australia. The well was drilled to a depth of 14,032 ft
(4,277 m) in 935 ft (285 m) water depth targeting the
Mungaroo formation, which will be intersected at
approximately 14,108 ft (4,300 m) below sea level. The
well has encountered indications of hydrocarbons, sug-
gesting the presence of a gas column from the top of
the primary target.
Cooper Basin oil find
Cooper Energys Parsons-3 well the first well in the
2011 PEL 92 area drilling campaign has intersected a
30-ft (9-m) oil column in the Namur reservoir in Aus-
tralias Cooper Basin. The well was drilled to 4,626 ft
(1,410 m) total depth. The Parsons field currently is
producing approximately 1,100 b/d of oil from two
wells in the Namur reservoir.
Central Asia
ONGC hits Indian trio
Indias ONGC has made three discoveries. The Aliabet-2
well in Block CB-OSN-2003/1 was drilled to a depth of
6,913 ft (2,107 m) in the Cambay Basin in northwest
India. Initial production totaled 455 MMcf/d of gas and
212 cf/d of condensate. In the Krishna Godavari (KG)
Basin in southeast India, the company hit oil and gas
with the Malleswaram-1 well in the PEL Block 1A. The
well produced 1.68 Mcf/d of oil and 393 Mcf/d of gas.
In the offshore shallow-water KG Basin, the GS-29-6 well
produced 20 Mcf/d of oil and 4 MMcf/d of gas.
Uzbekistan oil find
Tethys Petroleum Ltd.s NUR96H2 horizontal develop-
ment well at the North Urtabulak field in Uzbekistan
has flowed more than 1,100 b/d of oil and now is being
put on production. The well was drilled to a total depth
of 10,039 ft (3,060 m), with a producing section of 1,434
ft (437 m) of lateral hole.
Siberian double for Rosneft
Rosneft has discovered two new oil and gas fields at the
Sanarsky and Preobrazhensky license areas in Eastern
Siberia. Preliminary data suggest that the Sanarskoye
EPmag.com
READ MORE ONLINE
For additional
information on
these projects
and other global
developments:
Tethys is developing the North Urtabulak field in Uzbekistan.
(Image courtesy of Tethys Petroleum Ltd.)
110-114 Highlights_110-114 Highlights 3/23/11 5:01 PM Page 110
111
and Lisovskoye fields each have initial recoverable
reserves of approximately 586 MMbbl of oil.
South America
Oil flows in Santos Basin
Petrobras has discovered a new accumulation of good-
quality 26 API oil in the Santos Basin presalt reservoir,
approximately 152 miles (244 km) off the coast of Rio de
Janeiro State, Brazil. Well 4-BRSA-818 (4-RJS-668), named
Macunama, was drilled in 7,001 ft (2,134 m) water depth
and confirmed reservoirs at 18,635 ft (5,680 m).
OGX hits shallow-water oil
OGX has identified the presence of hydrocarbons in
well 1-OGX-31-RJS in the BM-C-41 block in the shallow-
water Campos Basin approximately 50 miles (80 km) off-
shore Brazil. The Ocean Ambassador semisubmersible
drilled the well to a total depth of 12,421 ft (3,786 m) in
446 ft (136 m) water depth.
A 489-ft (149-m) oil column with approximately 157 ft
(48 m) of net pay was encountered in the Albian sec-
tion, and a 194-ft (59-m) column with approximately 75
ft (23 m) of net pay was encountered in the Aptian sec-
tion, both in carbonate reservoirs.
Bolivia field comes onstream
Total has brought the Ita gas and condensate field
onstream in Block XX (Tarija Oeste), 249 miles
(400 km) south of Santa Cruz, Bolivia, in the Andean
Cordilleras foothills. The first phase of development
is designed to produce 53 MMcf/d of gas.
Africa
Algeria gas flows
Petroceltics AT-4 well has tested gas from two zones in
the Ain Tsila field in the Isarene permit (blocks 228 and
229a) in Algeria. The well encountered a gross gas col-
umn of 509 ft (155 m) with no gas-water contact. The two
zones in the Ordovician reservoir had a combined flow
rate of 1.35 MMcf/d of gas and 450 b/d of water on a
48-in. choke.
Ghana oil for Tullow
Tullow Oil Plcs Teak-1 exploration well has discovered
approximately 240 ft (73 m) of net hydrocarbons in
the West Cape Three Points license offshore Ghana.
The Atwood Hunter semisubmersible drilled the well to
a total depth of 10,400 ft (3,170 m) in 2,848 ft (868 m)
water depth.
In the shallower reservoirs, the well intersected 20 ft (6
m) of oil pay in the upper zone and 108 ft (33 m) of gas
pay with an underlying 49-ft (15-m) 40 API oil leg in the
lower zone. In the deeper reservoirs, the well intersected
46 ft (14 m) of gas-condensate pay in two separate zones
and 16 ft (5 m) of 32 API oil pay in a deeper level.
Moroccan gas discovery
Circle Oils #6-DRJ exploration well in Moroccos Sebou
permit in the Rharb Basin has hit gas in the Base Guebbas
target. The well flowed 5.36 MMcf/d of gas on a
26
64-in.
international
HIGHLIGHTS
The Macunama well discovered 26 API oil in the Santos Basin.
(Image courtesy of Petrobras)
The Teak-1 well encountered approximately 240 net ft of oil,
condensate, and natural gas pay in five separate Campanian-
and Turonian-age reservoirs. (Image courtesy of Anadarko
Petroleum Corp.)
H A R T E N E R G Y
Go Beyond the Press Release
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Now come to OilandGaslnvestor.com
for the real story behind it
(and what it means for your business).
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113
international
HIGHLIGHTS
choke from perforations between 3,419 and 3,442 ft
(1,042 and 1,049 m) from a net gas pay of 14.8 ft (4.5 m).
Anadarko hits again offshore Mozambique
Anadarko Petroleum Corp. has made another large dis-
covery offshore Mozambique. The Tubaro discovery
well the fourth in the companys Offshore Area 1 cam-
paign hit 110 net ft (34 net m) of dry gas pay. Seismic
indicates the field could be as large as 15,000 acres and
could contain 1 to 1.2 Tcf of recoverable reserves.
Europe
Producer offshore Greece
Energean Oil & Gas has completed the PA-35 infill well
in the Prinos field in the Aegean Sea offshore Greece.
The GSP Saturn jackup drilled the well to a total depth
of 9,760 ft (2,975 m), confirming the presence of the B
and C reservoirs at 9,380 and 9,544 ft (2,859 and 2,909
m) measured depth, respectively. The PA-35 well pro-
duced 1,000 b/d of oil; total reserves for Prinos are esti-
mated at 1.8 MMbbl.
Statoil find near Gullfaks
Statoil has found gas and condensate in Rimfaks Valley in
the middle sector of the Norwegian North Sea with well
34/10-53 S. The well was drilled to a vertical depth of
12,621 ft (3,847 m) below sea level in 446 ft (136 m)
water depth and confirmed a column of approximately
984 ft (300 m) in good-quality reservoir rocks. The discov-
ery is estimated between 19 and 75 MMboe recoverable.
Middle East
Hydrocarbons flow in Yemen
DNO International has hit hydrocarbons with the Gab-
dain-1 exploration well in Block 72 in Yemen. The well
was drilled through to a total depth of 11,434 ft (3,485
m) measured depth. The well produced approximately
130 to 180 b/d of 39 API oil at the end of a five-day test.
Kurdistan oil discovery
Gulf Keystone Petroleum has completed the Shaikan-3
shallow appraisal well in the Shaikan block in Kurdistan.
The well flowed 9,800 b/d of oil on a
128
64-in. choke with
a flowing tubing pressure of 264 psi.
North America
Louisiana well completed
Phoenix Exploration Co. has completed the #1 State
Lease 20221 well in St. Mary Parish, La. Initial potential
from the well was 15.24 MMcf/d of gas, 122 b/d of 40.4
condensate, and 20 b/d of water through perforations
at 18,194 to 18,314 ft (5,546 to 5,582 m) in the Cibicides
opima.
Gas flows from Mississippi well
Moon-Hines-Tigrett Operating Co. has completed the
#1 East Dexter 34-13 well in the East Dexter field in Sec-
tion 34-2n-13 w in Marion County, Miss. The Lower
Tuscaloosa well was drilled to 9,605 ft (2,928 m) and
flowed 1.3 MMcf of gas.
Alabama wildcat hits oil, gas
Midroc Operating Co. has drilled the #30-4 Mary Mack
wildcat well to 11,920 ft (3,633 m) in Little Cedar Creek
field in Conecuh County, Ala. The well initially flowed
159 bbl of 56 gravity oil and 620 Mcf of gas from Nor-
phlet perforations between 11,770 and 11,790 ft (3,587
and 3,594 m). No water flowed from the well.
Gulf of Mexico
Hess submits deepwater proposal
Hess Corp. has submitted a plan to drill three deepwater
exploratory tests across three blocks in the deepwater
Gulf of Mexico in approximately 1,282 to 2,075 ft (391
to 632 m) water depth. The first proposed wildcat well
is slated for a surface location in the southwestern area
of Green Canyon Block 70. A second test is scheduled
for a site in the western portion of Block 25, and a third
location is planned for the northeastern portion of
Block 69.
The development wells in the Prinos field offshore Greece are
conventionally deviated to cover the entire anticlinic struc-
ture. (Image courtesy of Energean Oil & Gas)
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ADVERTISER INDEX
on the
MOVE
115
Apache Corp. has appointed Rod
Eichler president and COO and
Roger Plank president and CCO.
Howard Hoffmann has been
promoted to CEO of United
Vision Logistics.
President and COO Christopher J.
Wiernicki has been appointed CEO
of ABS.
Mainland Resources Inc. has named
Michael J. Newport CEO and director.
The Marine Well Containment Com-
pany has appointed Marty Massey CEO,
Astley Blair CFO, Dan Smallwood COO,
Charles Miller CTO, and Carmine
Dulisse HSE officer.
John P. Anerousis has returned as
chief business development officer
of Coastal Flow Gas Measurement.
Red Spider has named David Allan COO.
TerraSpark Geosciences has appointed
Robert Stevenson COO.
MicroSeismic Inc.
has promoted
Michael Thornton
PhD (left) to CTO.
Chief geophysicist Michael Mueller
(right) will succeed him as vice presi-
dent of Analysis.
American Association of Professional Landmen . .62
Baker Hughes Incorporated . . . . . . . . . . . . . . . . . . 35
Basic Energy Services . . . . . . . . . . . . . . . . . . . . . . . 85
BGP Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Cameron . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IFC
CGGVeritas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
CNPC Greatwall Drilling Company . . . . . . . . . . . 48
Compressor Systems, Inc. . . . . . . . . . . . . . . . . . . . . 87
Dolphin Geophysical . . . . . . . . . . . . . . . . . . . . . . . 38
Dragon Products, Ltd. . . . . . . . . . . . . . . . . . . . . . . . 14
EAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
E&P 58, 71, 76, 80-81, 90-91, 98, 102, 104-105, 112, 114
Emerson Process Management . . . . . . . . . . . . . . . . 7
Escondido Resources II . . . . . . . . . . . . . . . . . . . . . 107
Frontier Energy Group, Inc. . . . . . . . . . . . . . . . . . . 79
FGMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Fugro Jason . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Gas & Oil EXPO & Conference . . . . . . . . . . . . . . 105
GEA Westfalia Separator Group . . . . . . . . . . . . . . 17
GEFCO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
Halliburton . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Lufkin Industries Inc. . . . . . . . . . . . . . . . . . . . . . . . . 23
Magnum Oil Tools International . . . . . . . . . . . . . . . 19
M-I Swaco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Momentive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
National Oilwell Varco . . . . . . . . . . . . . . . . . . . . 13, 64
Newpark Drilling Fluids . . . . . . . . . . . . . . . . . . . . . 30
NOMADS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
OTC Brasil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
P2 Energy Solutions . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Paradigm . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Pegasus Vertex, Inc. . . . . . . . . . . . . . . . . . . . . . . . . 109
Petris . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
PGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Polarcus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Precision Geophysical, Inc. . . . . . . . . . . . . . . . . . . . 46
Roper Pump Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
Schlumberger . . . . . . . . . . . . . . . . . . . . . . . . . . OBC, 3
Sercel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Society of Exploration Geophysicists . . . . . . . . . . 71
Society of Petroleum Engineers . . . . . . . . . . . . . . 104
Stallion Oilfield Services . . . . . . . . . . . . . . . . . . . . . 89
Tenaris . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Tetra Technologies . . . . . . . . . . . . . . . . . . . . . . . . IBC
TSC Offshore . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Varel International . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Weatherford International Ltd. . . . . . . . . . . . . . 20, 21
WesternGeco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Wood Group ESP . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
World Petroleum Congress . . . . . . . . . . . . . . . . . . 68
Group Publisher
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MARKETING | SALES | CIRCULATION
Robert Burke, industry journalist, passed
away on March 12, 2011. For more than 20 years,
Burke was editor-in-chief of Offshore magazine
and served numerous times on the board of
directors for the National Ocean Industries Asso-
ciation in Washington, DC. He was president and
on the board of directors for the Association of
Petroleum Writers and was a founding member
of the technical committee for the annual sem-
inar Deep Offshore Technology. After his time
at Offshore, Burke joined Hart Publications as
senior editor to open a Houston office for Petro-
leum Engineer International magazine.
In Memoriam
115 Onthemove_Layout 1 3/23/11 5:29 PM Page 115
r-
I
17-
P
116
A
s hydrocarbon reserves become harder to recover,
technological expertise will keep oil supplies flowing,
solving the challenges facing the global industry.
New technology is fundamental in supporting efficient
production, and staying ahead in the R&D game is not
only the responsibility of the industry reforms are needed
on a fiscal as well as a national level. With the collapse of
bank profits and slow post-recession recovery, the oil and
gas sector now is the biggest contributor of corporate tax to
the UK Treasury.
Research shows that UK production still can meet much
of the domestic energy requirement. More hydrocarbons
can be extracted; however, this depends on the right tax
incentives for oil and gas operators not subsidies, but
tax breaks.
The rules regarding R&D expenditure
need to be re-examined to boost project
activity on the UK Continental Shelf
(UKCS). Currently, if an operator con-
tracts research from a university, the com-
pany can obtain tax credit. However, if
the R&D work is carried out by a contrac-
tor, the contractor receives the tax credit.
A more fair system would award the tax
credit to the party that actually pays for
the R&D program.
Consideration also should be given to increasing the lev-
els of tax incentives for both R&D and technology demon-
stration. Much can be learned from Norways successes in
this area, particularly with regard to making field trials
more tax-efficient.
Today much activity is geared toward small fields.
But recent news of big finds is a reminder that although
the Central North Sea is mature, it is very much alive
and healthy.
In the past, it has been estimated that 5.6 Bboe reserves
could be made economic over a five-year period in the
UKCS through the deployment of new technologies. It is
widely recognized that new technology has been responsi-
ble for reducing the risks involved in exploration and slash-
ing drilling times by half. These advantages alone are
critical factors in encouraging companies to adopt technol-
ogy as the way forward.
ITF fosters the need for collaboration between operat-
ing companies, large service companies, small and
medium-sized enterprises, universities, and academia to
distribute the risks and benefits of technology innovation.
In the UK, there are many organizations working to
their own agendas. A national coordinated approach like
Norways that annually identifies and addresses one set
of industry challenges would be a better way forward for
the UK. A country-wide strategy for new technology is
required to get the remaining reserves out of the ground.
All parties should agree to a set of goals so a united,
strategic approach to achieving these objectives becomes
a reality. Although a lot of work is being done in the UK,
it is carried out in a very fragmented manner. The country
needs to focus on identifying and understanding the indus-
trys technology needs as well as promot-
ing the role of an intermediary, such as
ITF, among the organizations involved.
This type of umbrella model exists
in Norway OG-21 where partnering
among government, oil companies, the
supply industry, research institutions,
and academia acts as a catalyst, ensuring
new technology is developed and tested
and that solutions are implemented.
Increased investment in technology
is needed by all UK stakeholders to pro-
duce a realistic impact in terms of enhanced investment
and recovery in the UKCS.
Because full-scale testing must be completed before a
technology can be accepted into the market, commercial-
izing technology to the oil and gas market is costly and
time-intensive, requiring nearly twice as long as in other
sectors. This is why UK end-users must demonstrate com-
mitment to field trials, pilot new technologies, and over-
come the risk-averse mood, which can be very inhibiting.
Now is the time when all those involved in UKCS opera-
tions, including the Department of Energy and Climate
Change and HSE, need to collaborate to develop the
technologies needed for the North Sea Basin. Without
this unified approach, it will be very difficult for the coun-
try to develop much of the remaining 5.6 Bboe.
R&D needs government boost
New technology is the way forward in producing the remaining reserves
in maturing oil and gas fields on the UKCS, but a more united approach
is needed.
Neil Poxon, Industry Technology Facilitator (ITF)
last
WORD
A country-wide
strategy for
new technology
is required to get
the remaining
reserves out of
the ground.
LastWord_LastWord 3/23/11 5:02 PM Page 116
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