Shale Gas Exploration

and Hydraulic Fracturing

Eric Vaughan, Well Services Director

IMechE May 13, 2014

Who is Cuadrilla
What is Unconventional or Shale Gas
UK Shale Gas Areas
Hydraulic Fracturing
Economics

Cuadrilla who we are

Formed in 2007, UK company
Early entrant to shale gas in Europe

Exploration assets
Netherlands 680,000 acres
Bowland basin 293,000 acres

Prospective and diversified acreage portfolio

Weald basin 192,500 acres

Partnered with government and backed by

Poland 440,000 acres

industry-specialist funds

 What is Unconventional or Shale Gas?

Why is Hydraulic Fracturing Needed?

Gas emanating from visible fractures

 UK Shale Gas Areas

Earliest UK Shale Gas Well - 1875

10

Source: Professor Dick Selly, Department of Earth

Science and Engineering

DECC/BGS Shale Gas Study

11

Bowland Basin
Correct geology
Legacy 2D seismic
Age and depth of shales
History of wells drilled
Thistleton-1
Banks-1
Hesketh-1
Elswick-1
History of oil and gas production in
area
Formby Oilfield
Off-shore production
Elswick-1
National Grid has over 190,000 km
of pipelines

Key:
A. Thistleton-1
B. Hesketh-1
C. Banks-1

1. Preese Hall-1
2. Grange Hill-1Z
3. Becconsall-1Z
4. Annas Road-1 HZ
5. Elswick-2 HZ

12

National Grid High Pressure Gas Pipe Locations

Early Fracturing not really hydraulic!

Trying to increase surface area of

reservoir rock exposed to wellbore.
150 foot section of reservoir exposed in
8 inch hole is only 333 ft2.

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Precursor Fracturing Technology

November 1866 Patent for Roberts
Torpedo
Initially used gunpowder and later
nitroglycerin
Filled borehole with water to provide
fluid tamping
Pennsylvanias Otto Cupler Torpedo
Company shot its last oil well using
liquid nitroglycerin in 1990

14

Bigger Toys Fracturing Technology

Gasbuggy-1967
29 kilotons
Rulison-1969
43 kilotons
Rio Blanco-1973
3 by 33
kilotons each

15

 Hydraulic Fracturing

16

What is Hydraulic Fracturing?

According to the United States Environmental Protection

Agency (EPA) hydraulic fracturing is a process to stimulate a
natural gas, oil, or geothermal energy well to maximize the
extraction.
Main purpose is to increase the effective surface area of the
wellbore to allow oil and gas to flow from the rock matrix into
the wellbore.

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Hydraulic Fracturing
Injects fluid into rock at a high enough pressure to cause the
rock to fracture.
Fluids can be water based, hydrocarbon based, acids,
liquid CO2, gaseous N2, foams and various combinations.
The fractures are held open with proppant after the hydraulic
pressure is released.
Typically silica sand.
At greater depths or pressures, ceramic proppants can be
used.
Common sizes are 20/40 mesh (0.853mm-0.422mm) and
40/70 mesh (0.422mm-0.211mm)

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First Hydraulic Fracture Treatment

Stanolind Oil
Company
Hugoton Gas
Field, Kansas
1,000 gallons
of naphthenicacid-and-palmoil (napalm)
and river sand

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Increase Stimulated Rock Volume

Stimulated Reservoir Volume 430 million ft3 with

high viscosity cross-linked gel
Stimulated Reservoir Volume 1.4 billion ft3 with
low viscosity slickwater
20

Frac Mine Back Experiments

21

(Warpinski, 2011)

 Microseismic
monitoring
Multiple frac
stages

22

Monitoring Frac Height Growth

23

Generate the Hydraulic Pressure

8,000 foot vertical depth well with 14,000 feet of
measured depth.
Fracturing fluid is fresh water.
5 inch monobore well casing.
Injection rate is 80 barrels (12.7m3) per minute.

24

Generate the Hydraulic Pressure

Typical shales require 0.8-1.1 psi per foot of vertical depth to
fracture.
With a fracture gradient of 0.9 psi/foot then 7,200 psi at
the formation is required.
The hydrostatic pressure of the water based fluid helps.
Just the water exerts 3,464 psi.
This leaves 3,736 psi required at the surface to pump the
fractures open.
However, friction from the drag of the water along the walls of
the steel well casing increase this pressure.
Water only would generate 725 psi per thousand feet of
pipe or 10,150 psi.
With friction reducer this would be about 215 psi per
thousand feet of pipe or 3,010 psi.
Pumping surface pressure is 7,200-3,464+3,010=6,746 psi.
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Friction Pressure

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This is not a frac rig!

27

Early Frac Pumps

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JPT December 2010

1955 frac pump

manufacturing.
Remote
controlled
pumps powered
by war surplus
1,475
horsepower
Allison aircraft
engines

Frac Pumps in the UK 1990s

First started in UK in 70s
Over 200 fracs performed onshore in the UK

Detroit 12v 149TI,

Allison Transmission,
Triplex pump, 1,200
horsepower

Multi-stage, gelled
water frac,
Cheshire, UK 1992

29

Modern Frac Pumps

Cat 3512C engine, Cat TH55 eight speed

transmission, FMC WQ2700 quintuplex pump

Weir-SPM Destiny TWS 2500 Pump

Up to 20,000 psi and 2,500 bhp per pump

Triplex and quintuplex positive displacement pumps
Cummins QSK50-60, MTU 12V4000 and Caterpillar 3512C
most common engines
Allison, Caterpillar and Twin Disc transmissions
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Frac Suite on Preese Hall-1

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Hydraulic Fracturing in Poland

32

Hydraulic Fracturing in USA

33

Frac Boats in the North Sea

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 Frac Design

35

Example Horizontal Well Design

36

Frac Sleeve

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Frac Sleeve

38

38

Pumping Program

39

Well Name:
Customer:

Preese Hall-1
Bowland Resources

Formation:
Elap
Time
Pressure
min
psi
Job started at 16:35
6.8
1,400
19.6
20.9
25.0
29.0
33.5
6,290
38.0
6,296
42.5
6,184
51.2
60.0
6,329
67.5
6,180
75.2
6,233
83.0
6,180
90.5
6,325
98.0
6,304
105.0
6,580
114.0
6,321
120.5
6,500
129.5
6,470
137.5
6,592
146.0
6,500
152.5
6,400
161.0
6,370
177.0
6,480
183.0

Lower Worston Shale

Cum.
Stage
Fluid
Fluid
bbl
bbl
640.0
723.0
1,021.0
1,300.0
1,620.0
1,910.0
2,220.0
2,641.0
3,225.0
3,700.0
4,200.0
4,705.0
5,220.0
5,720.0
6,210.0
6,830.0
7,300.0
7,920.0
8,420.0
9,030.0
9,510.0
10,100.0
11,150.0
11,568.0

640.0
83.0
298.0
279.0
320.0
290.0
310.0
421.0
584.0
475.0
500.0
505.0
515.0
500.0
490.0
620.0
470.0
620.0
500.0
610.0
480.0
590.0
1,050.0
418.0

Date:
Job Num:
Meyers File:
Stage Stage 1 Frac
Slurry
Rate
bpm
56.0
64.0
72.0
70.0
70.0
70.0
70.0
70.0
67.0
67.0
67.0
67.0
67.0
70.0
70.0
70.0
70.0
70.0
70.0
70.0
70.0
70.0
70.0
70.0

Blender
Conc.
psa

0.20
0.20
0.40
0.70
0.90
1.25

Prop
lbs

Prop
type

700 HST80
2,344
5,376
8,526
11,718
22,103

HST80
HST80
HST80
HST80
HST80

0.21

4,163 CH52

0.42

8,851 CH52

0.63

13,146 CH52

0.83

21,734 CH52

0.83

21,734 CH52

0.83

21,384 CH52

1.04
1.25

25,853 CH52
55,212 CH52

28-Mar-11
1

Comments/Fluid
<-use HST80 or CH52 for auto-total

Safety Mtg
Start FR water
slug
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
FR Water
Stop

40

Stage 1 11,568 bbl, 101.1 metric tons prop

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 Economics

41

Indigenous gas production supplies a

decreasing share of UK demand
Growing gas import gap

42

(Source: Department of Energy and Climate Change)

UK Energy Electricity vital but only 20% of energy demand

The challenge is much more than Keeping the Lights On
UK Final Energy Consumption - 2011
4%

Petroleum

2011 Shares of Electricity Generation

Other 1.5%

Renewables
9.4%

Coal 29.5%

Natural Gas

20%
45%

Electricity
Other

31%

Gas 39.9%

Oil 1.0%
Nuclear 18.8%
2013 Shares of Electricity Generation
Other, 1.5%

Renewables,
14.8%

Coal, 36.3%

From 2011 to 2012 Electricity Generation

increased coal use from 29.5% to 39.3%
And decreased gas use from 39.9% to
27.5%
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Data Source Dept. of Energy & Climate Change

Gas, 26.8%
Oil, 0.7%
Nuclear, 19.8%

Dont worry about the Russian gas

2012 UK Coal Imports
Other, 2.0%

Columbia, 26.0%
2012 Shares of Electricity Generation
Other 1.5%
Russia, 40.0%

Renewables
11.3%

Coal 39.3%
Gas 27.5%

USA, 24.0%

South Africa, 1.0%

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EU, 1.0%
Australia, 6.0%

Data Source Dept. of Energy & Climate Change

Oil 1.0%
Nuclear 19.4%

55% of gas goes to heat and industry

36% gas goes to
heat
36% of gas goes to
electricity and
associated uses
19% to industry and
other final customers
9% other
(Source: Department of Energy and Climate Change)

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Use of Gas
Heat
Electricity
Industry
Losses

Current Fuel Mix for National Electric Grid

05 May 2014

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(Source: http://www.gridwatch.templar.co.uk/)

Indigenous gas production supplies a

decreasing share of UK demand
Growing gas import gap

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(Source: Department of Energy and Climate Change)

Send Billions of to the exporters or:

Potential contribution
from Shale

(Source: IoD calculations)

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On-Shore Gas Industry

Meaningful unsubsidized private investment
(Bowland alone 50B through 2039)

Meaningful job creation (74K at peak)

Meaningful energy security contribution
Green completion standards
Small industrial footprint

(Source: IoD calculations)

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Community benefits
Local authority to receive 100% of business rates
Communities receive 100,000 for every exploration well
site that is hydraulically fractured
Communities receive one per cent of revenues from future
shale gas production
Potentially, more than 1 billion over a 20 to 30 year shale gas production
timescale could be returned to Lancashire communities within the Bowland
Basin license area alone

The above is (broad brush) paid 2/3 locally, 1/3 to the

county (many specifics to be worked out)

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Thank you

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