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Economical Mature Field Revitalization in Low Oil Prices Environment: A

Ten Thousand Incremental Oil Production Case Story in the Drago Complex
Field, Ecuador

Alvaro Izurieta, Dario Cuenca, Lenin Pozo, Wilson Padilla, and Jairo Bustos, Petroamazonas EP

Copyright 2018, Society of Petroleum Engineers

This paper was prepared for presentation at the SPE Trinidad and Tobago Section Energy Resources Conference held in Port of Spain, Trinidad and Tobago, 25-26
June 2018.

This paper was selected for presentation by an SPE program committee following review of information contained in an abstract submitted by the author(s). Contents
of the paper have not been reviewed by the Society of Petroleum Engineers and are subject to correction by the author(s). The material does not necessarily reflect
any position of the Society of Petroleum Engineers, its officers, or members. Electronic reproduction, distribution, or storage of any part of this paper without the written
consent of the Society of Petroleum Engineers is prohibited. Permission to reproduce in print is restricted to an abstract of not more than 300 words; illustrations may
not be copied. The abstract must contain conspicuous acknowledgment of SPE copyright.

This paper presents the results of the most extensive hydraulic fracturing campaign on the same field
in Ecuador, along with the methodology appliedto establish the real field production potential and an
incremental oil production of 10,000 STB/d.
The study started with the review of pressure transient analysis (PTA), resulting in updated values of
permeability, skin and reservoir pressure, then conventional and special well logs were revisited to get a
consistent approach of reservoir pay intervals. The characterization of formation damage mechanism was
performed to confirm and complement the results. Strategic execution of the hydraulic fracturing workovers
was implemented for fast track execution and to maximize results.
The rigorous and fundamentals-based review showed that additional production potential, on most of
the wells in the field, could be achieved by hydraulic fracturing due to the high skin values and the deep
penetration nature of the damaged zone. The interventions schedule of producing and nonproducing wells
resulted in short deferred production times. All planned jobs were designed with the goal of reaching the
maximum production defined by hydraulic fracturing and complete nodal analysis. Most fracturing jobs
resulted in folds of increase, FOI, from 2 to 13. The learning curve started from one stage tip screen out,
TSO, and conventional long fractures, to two stage hydraulic fracturing, pulsed proppant and propped
acid fracturing jobs. Economical evaluation showed that the whole stimulation campaign recovered the
investment during the third month of execution.
The incremental production outcome from these jobs resulted in ten thousandstandardbarrels per day,
10,000 STB/d, the historical peak oil of the field and the most extensive hydraulic fracturing campaign in
the country.

The Drago Complex description

The Drago Complex was discovered by Ecuador's NOC in 1972 with the Vista-001 well, at that time the
field was considered non-commercial and the exploratory well was plugged and abandoned. Later in 2006,
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Ecuador's NOC started the development of the Drago Field with the Drago-001, Drago Este-001 and Drago
Norte-001 wells, based on 2D and 3D seismic, proving oil reserves in the U and T sandstones as main targets
and the Hollin and Basal Tena sandstones as secondary targets.
With this discovery, a fast development plan started. The drilling campaigns were sustained from 2009
until mid 2014 with the industry downturn and the development was suspended. By that time the Drago
Complex had 45 wells, with half of them being inactive due to low productivity. With this scenario, the
production operations in the complex resulted in sporadic workover jobs to sustain production, no further
drilling was planned for at least the fivefollowing years. To boost production from workover jobs, a detailed
review was needed to address the real potential of the field.

Figure 1—The Drago Complex field development

The DragoComplex -Drago, Drago Norte and Drago Este fields- is an asymmetric, anticlinal structure, with
an axis of approximate North-South direction. It is constituted of three main structural highs- Drago to the
southwest, Drago Norte to the north and Drago Este to the southeast of the structure. It is the product of
the reactivation of pre-Cretaceous faults, transient movements and the intrusion of igneous bodies, which
in conjunction gave the genesis to this geological structure. Located in the foredeep of the Oriente Basin
with coastal and transitional delta and estuary deposits. The Drago Complex is an elongated anticline with
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preferential direction N-S product of compressive stresses. The main reservoirs are the U and T sandstones,

Figure 2—Structural correlation showing main reservoirs

The value of the information

Any productivity study begins with the integration of geoscience, reservoir engineering, drilling and
completion data. The understanding of the reservoir plays a vital role on the productivity assessment of
any field. The accuracy of the study can only be proved by the performance of the wells once the jobs
are executed. During the development of the Drago Complex, a great amount of information was collected
to characterize the different reservoirs. With this great amount of data collected over the years, a known
methodology was applied using the corporate software to collect, organize, standardize and turn data into
information as shown in Fig. 3, (Consentino, 2001). Once the information was organized and structured, a
comprehensive workflow was used to define the opportunities of incremental oil production, (Ruano, 2014).

Figure 3—Ideal Structure of a project database (Consentino, 2001)

Pressure Transient Analysis (PTA)

The application of PTA on this study was focused on production engineering i.e. the individual well (Spivey,
2013). Various tests were evaluated on each well to obtain quantitative updated values of permeability, skin
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and reservoir pressure. The methodology used is described by Izurieta (2015). Results from this evaluation
showed that most wells in the field had a high skin, which was not deep enough to be removed with
conventional approaches such as re-perforating or matrix acidizing, Fig. 4,therefore a more appropriate
remedial or stimulation technique must be used (Spivey, 2013).

Figure 4—Updated petrophysical interpretation and global hydraulic elements

Well log data

The next step on the workflow was to review well log data, both open hole and cased hole. To achieve this
goal all conventional and nuclear magnetic resonance (NMR) logs were loaded in the corporate database.
Logs were environmentally corrected, well tops updated and petrophysical evaluation was calibrated with
core data (Bateman, 2012). The permeability was derived from methodologies like Winland R35 or global
hydraulic elements (Corbett, 2007). Along with NMR, carbon/oxygen logs and this updated interpretation,
new pay zones and additional pay intervals on known reservoirs were identified as shown in Fig. 5.

Figure 5—Updated petrophysical interpretation and global hydraulic elements

Formation damage characterization

From PTA, it was concluded that most wells presented high skin damage from the very beginning of the
productive life of the well, this was attributed to the following causes:
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• Drilling the wells to the lower most reservoir, Hollin sandstone, which has a reservoir pressure of
about 4,400 psi, more than 2,500 psi when compared to the Lower U and Main T sandstones. This
difference was the reason for using a mud weight up to 12.4 ppg to control this pressure while the
other reservoirs were still exposed.
• Fines invasion into the formation while drilling. (Smith, 2015)

• Lack of effective bridging agent for the upper reservoirs.

• Incompatibility between drilling fluid and formation fluid. (Smith, 2015)

Practices like re-perforating, aided with dynamic or static underbalance, propellants and acid stimulation
treatments were tested to bypass the damaged region and restore well productivity. These previous
experiences showed no significant improvement and gave an insight to the presence of an extended damaged
region beyond the penetration depth of the techniques used.
To support the theory of drilling induced damage, an analytical model, Eq. 1, in conjunction with
the Hawkins formula, Eq. 2, was used to estimate skin from drilling mud filtrate invasion and to prove
consistency with the values derived from pressure transient analysis. (Economides, 2012).



The calculations assumed rs= rp and ks=0.1k, and the results from this exercise showed skin factors in the
range of 7 <s <27,confirming drilling induced damage as the main contributor to skin and the assumption
that all wells should be considered damaged, since drilling practices were the same through the development
of the field.

Productivity Assessment
Because of the deep penetrating nature of the damaged region present on the studied wells, hydraulic
fracturing was selected as the appropriate technique to restore well productivity. The production
optimization workflow as shown in Fig.6, (Ghalambor, 2009) is found in the following way:
1. By determining and confirming that the well is underperforming. Once PTA was updated, the study
was complemented with nodal analysis to have a quantitative measure of the optimized production
by skin reduction.
2. By conducting a pressure transient test. Even though the initial diagnosis showed that any well in the
field would present skin damage, the values of permeability and skin were still needed for those wells
without a previous pressure build up with no reliable analogous wells.
3. By analyzing well performance and identifying production impediments. Integrated analysis included
surface facilities limitations and artificial lift equipment design.
4. By understanding the reservoir rock and fluid chemistry, compatibility tests were performed on each
fluid to be used during the workover.
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Figure 6—Production Optimization Workflow

Fracture design
Once it was established that any well in the field would show high skin and that any attempt to bypass this
damaged zone by re-perforating or by matrix stimulation would beunsuccessful, hydraulic fracturing was
selected as the adequate technique, unless detrimental production risk was expected. (Economides 2007).
The stimulation jobs visualized for the Drago Complex had the following objectives (Ghalambor, 2009):

• To bypass formation damage.

• To reduce near wellbore drawdown during production.

• To improve communication between reservoir layers and the wellbore.

• To produce at economical rates while maintaining the pressure drawdown.

The next step in this process was to determine the dimension of the fracture half-length needed, based
on permeability values derived from PTA. The approach from Gidley, (1990), Fig.7, was selected and by
using permeability data, the maximum fracture half-length was limited to xf≈250 ft.
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Figure 7—Desired fracture half lengths for different formation permeabilities (Modified after Gidley, 1990)

Tip Screen Out (TSO). Based on the permeability range, the TSO technique was selected as the appropriate
design to reach the productivity goals. This technique relies on propped fracture width as the key component
to generate fracture conductivity, this is achieved by a rapid increase in proppant concentration, Fig. 8,
(Jones, 2009). A sample of the net pressure behavior observed on these jobs is shown on the Nolte-Smith
plot, Fig.9.

Figure 8—Conceptual design of TSO treatment and actual treatment (Modified after Jones, 2009)
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Figure 9—Net pressure behavior of TSO treatment

Drainage area characterization

By using the classification described by Economides (2000), Fig.10, the typical drainage volumes found in
the Drago Complex were selected. The usual workover jobs performed on each type of drainage area were
also outlined and the expected fracture design was adjusted based on the following reservoir characteristics:

• Drainage Volume 1 matches the lower U sandstone, where wider and shorter fractures were
designed for those reservoirs with high permeability, i.e. in the range of 1000> k >100 mD. Towards
the west and south of the field, this reservoir turns thinner and less permeable and for this case
longer fractures were designed.
• Drainage Volume 2 matches lower T sandstone where a WOC is present in most of the field. For
this case, small fractures limited in height by water zones were designed.
• Drainage Volume 3 matches the upper U and T sandstones where the reservoir becomes layered
with zones of different permeability and pressures. For this case, two stage fractures were designed
on the same operation by using proppant as a pseudo plug for the lower layer.

Figure 10—Drago Complex, Drainage Volume Characterization (Modified after Economides, 2000)
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Folds of increase
Various methods published in the literature were reviewed to predict the productivity index improvement
after hydraulic fracturing. The workflow used the results from PTA, TSO treatment design and the Cinco
Ley & Samaniego correlation, Eq.3, to calculate the equivalent radial fracture skin, sf. Finally, the folds of
increase were calculated using Eq.4. For those wells with no pressure build up available, a skin factor of 15
was assumed based on the average skin from updated PTA. Results from this analysis are shown in Table 1.



Table 1—Folds of Increase calculation

Fracture Dimensionless Equivalent Folds of

Well Permeability Skin Half Conductivity, Radial Increase,
width, in
Length, ft Fcd Flow Skin FOI

1 136.0 19.70 0.194 157 1.00 −4.6 8.5

2 262.2 24.43 0.168 134 0.53 −4.0 8.3

3 819.7 21.33 0.149 142 0.14 −3.0 6.0

4 407.8 15.00 0.114 154 0.20 −3.3 5.1

5 458.4 33.14 0.193 140 0.33 −3.7 9.8

6 186.1 15.23 0.104 168 0.37 −3.9 5.9

7 108.0 0.30 0.106 155 0.70 −4.3 2.3

8 711.8 2.23 0.075 209 0.06 −2.7 1.9

9 263.2 19.70 0.103 138 0.31 −3.6 6.5

10 103.0 12.25 0.125 166 0.80 −4.5 6.0

11 202.2 19.80 0.138 148 0.51 −4.1 7.3

12 457.3 13.95 0.132 127 0.25 −3.3 4.8

13 119.5 0.10 0.108 140 0.71 −4.3 2.2

14 50.7 27.37 0.125 139 1.95 −4.9 11.8

15 110.0 44.05 0.13 150 0.87 −4.5 15.3

16 137.1 26.91 0.13 108 0.97 −4.2 9.5

17 228.2 7.31 0.106 164 0.31 −3.8 3.7

18 45.5 15.00 0.314 206 3.68 −5.5 9.7

19 28.5 6.52 0.121 160 2.91 −5.2 5.3

20 22.0 −1.76 0.098 121 4.03 −5.0 2.1

21 12.7 15.00 0.066 104 5.51 −4.9 7.8

22 379.8 7.40 0.0386 66 0.17 −2.4 2.8

23 135.0 15.00 0.191 120 1.29 −4.5 6.8

Well deliverability
To complement the production calculations and to have an idea of the artificial lift needed, the study
included nodal analysis (Inflow performance relationship + vertical flow performance), Fig. 11. Sensitivities
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to equivalent radial fracture skin and to the artificial lift equipment -number of stages, frequency and intake
depth- were performed to define the expected production with the definitive completion.

Figure 11—Complete nodal analysis including artificial lift

Maximize NPV through informed decisions

All jobs were planned to reach the ideal production case expectation, from design to execution. By setting
the ideal case as the production goal, all team players delivered solutions to maximize the net present value
The decision tree shown in Fig. 12 highlights the possible scenarios during workover planning that helped
to maximize NPV. This project used historical information and aimed to take new information to evaluate the
productivity increase in each case, i.e. value of information, (Kamal, 2009). In some cases, the information
showed a high risk for the project, at this point the asset team had the possibility to make an informed
decision as to whether the project should bedropped or the workover should be re-designed according to the
new data and if the risk was still favorable to production, the project should continue. The decision nodes,
go/no-go points and redesign points were:

• Carbon/Oxygen log to confirm saturated intervals.

• Production (mainly water cut) tests before hydraulic fracturing.

• Pressure build up tests.

Figure 12—NPV maximization though informed decisions and decision tree (Modified after Kamal, 2009)
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The executed workover program included up to three workover rigs with simultaneous operations on
different production pads. The program can be summarized as follows:
1. Prepare the location, the artificial lift, the facilities and the drilling rig according to the workover plan.
2. Pull out the completion string, this operation could include fishing operations.
3. To isolate lower reservoirs to avoid crossflow communication through BHA.
4. Perform the hydraulic fracturing.
5. To evaluate the well with no rig whileother fracture jobs start.
6. To close the well for pressure build up.
7. To complete the well with ESP.

The project started with one rig performing the early positive results which confirmed that production
potential from productivity assessments were in the expected range. Later on, two followed by three rigs
were active on the field. Oncemost of the jobs were executed, two rigs demobilized and only one rig
remained active on the field, Fig. 13. The highlights of this work are next described:

• As of December 2017, 23 fractures have been executed

• Peak oil production of the field, 16,995 Stb/day as of June 2017

• Incremental oil production of 12,948 Stb/day as December 2017, Fig. 14.

Figure 13—Fractures vs Time

Initially, a top producer on the field was 600 Stb/d in December 2016, by hydraulic fracturing the top
producer reached 2,000 Stb/d, with an average of 563 stb/d per fractured well (this average includes wells
that did not produce after fracture operations for differing reasons). Fig. 15, shows a monthly bubble map,
where red bubbles shows wells with production >= 600 Stb/d. The graphs start on January 2017 on the
top left, moving to the right and finishing on December 2017. At the end of 2017, most wells on the field
surpassed the 600 stb/d.
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Figure 14—Fractures vs Time

Figure 15—Bubble map, average monthly oil rate, Drago Complex

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The well Drago Norte-015, which had the highest oil production of the field, not only became the best oil
producer from the Drago Complex but also remained as one of the top ten producers from Ecuador's NOC
which accounts for the 80% of the national oil production, Fig.16.

Figure 16—Ecuador NOC, Top Ten producers as February 2018

Pressure Build Up
The pressure recorded in most of the wells after hydraulic fracturing confirmed the overall good results
showing negative skins in most cases, Fig. 17. Results from this interpretation were also used to design the
definitive artificial lift equipment to be installed.
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Figure 17—Skin factor before and after hydraulic fracturing

Learning curve
In terms of complexity, three main types of fractures were executed, as described in the drainage area
characterization. The most productive wells resulted from TSO operations performed in layers with and
without water contact. As the complexity increased, so did fracture dimensions and proppant mass,also, the
investment needed was higher because of lower permeability reservoirs, Fig.18.

Figure 18—Learning curve

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The net revenue criteria were applied to monitor the economic performance of the project. For a rigorous
evaluation three major items were added as investment and operational expenditures:

• Ecuador's international oil price (Napo &Oriente).

• Oil and water production costs.

• Overall workover costs.

Results from this evaluation, Fig. 19, showed that the project recovered the investment approximately
at the third month of execution.

Figure 19—Net Revenue vs Time

Case studies
Case study 1, the first candidate
The first candidate in the study was inactive for almost one year, the last oil production was 60 STB/d.
From the PTA update a skin of 19.7 was calculated and from fracture design a FOI = 8.5 was estimated.
The job consisted of 13,400 pounds of proppant 20/40 in the Lower U sandstone using the TSO technique,
Fig. 20. The production increased to 600 STB/d with a skin of −3.7. The fracturing pressure, rate and
proppant concentration is shown in Fig.20, the production profile before and after the fracture is shown
in Fig.21.
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Figure 20—Case study 1, fracture job

Figure 21—Case study 1, historical production

Case study 2, fracturing with 30% water cut

This well was on production for 2 years with an average oil production of 300 STB/d. Due to ESP problems,
it needed a workover job. Initially, the plan was to perform a simple pulling, but with the previous results and
a higher FOI, the plan changed to hydraulic fracturing. From the PTA update, a skin of 15.23 was calculated
and from fracture design, a FOI = 5.9 was estimated. Due to the relative high water cut, a small fracture was
planned and executed, which consisted of 12,450 pounds of proppant 20/40 in the Main T Sandstone. The
oil production increased to 1,000 SBT/d with 40% water cut and a skin of −2.5. The fracturing pressure,
rate and proppant concentration is shown in Fig.22. The production profile before and after the fracture is
shown in Fig.23.
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Figure 22—Case study 2, fracture job

Figure 23—Case study 2, historical production

Case study 3, the good producer to the best producer in the asset
This well was active before the fracture job with an oil production of 250 STB/d. From the PTA update, a skin
of 13.95 was calculated and from fracture design, a FOI = 4.8 was estimated. The job consisted on 13,200
pounds of proppant 20/40 in the Lower U sandstone using the TSO technique, Fig. 22. The production
increased to 2,000 STB/d with a skin of −2.15. The fracturing pressure, rate and proppant concentration is
shown in Fig.24, the production profile before and after the fracture is shown in Fig.25.
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Figure 24—Case study 2, fracture job

Figure 25—Case study 3, historical production

The geological structure showed that The Drago Complex has greater development potential than previously
addressed. In the future, adequate drilling techniques will be applied to minimize skin and decrease costs
related to well intervention.
The production increase of nearly 200% showed the real value of the field and led to the interest of several
private investors to develop similar projects on multiple fields of the Oriente basin.
The fast learning curve and production results were based on engineered solutions, rather than trial and
error operations.
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Results from production, PTA and economic evaluation showed that hydraulic fracturing is the
appropriate treatment on wells where conventional stimulation and workover operations have been applied
with minimum success.
The workflow applied resulted in the execution of 23 fracture jobs, which produced the historical peak
oil production on the Drago Complex.

The authors would like to thank Petroamazonas EP for permission to write this paper.

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