shale gas well completion & production … austin... · shale gas well completion &...
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Janie M. Chermak, University of New MexicoJames W. Crafton, Performance Science Inc.
Robert H. Patrick, Rutgers University
31th USAEE/IAEE North American ConferenceAustin, Texas
November 5, 2012
SHALE GAS WELL COMPLETION & PRODUCTION PRACTICES:
CONSERVATION, ENVIRONMENTAL & REGULATORY IMPLICATIONS
Shale Gas Plays
THE US SHALE GAS INDUSTRY• US PRODUCTION
- 2000: 0.4 trillion cubic feet (TCF)- 2008: 2.0 TCF- 2009: 3.1 TCF- 2010: 5.3 TCF (23% of total production)
•2035 FORECAST- 13.6 TCF (49%)- RANGE: 9.7 TCF – 20.5 TCF
•RESERVES ?
(EIA AEO 2012)
Regulatory Concerns
• Environmental
• Conservation
• Energy Policy
Research
• Actual production- reservoir characteristics- well characteristics- capital choices (completion and re-completion)- production choices
• Ultimate recovery may depend on- all of the above and- early management production decisions
The Firm’s Problem
Choose the initial (and periodic) capital investment(s)
and production path
to max profits over the life of the well
subject to:
R( j ) R( j
) u(R( j ), K j , j ), j 1,...,k
q t h A t ,Z t , K j
ert
0
T
P(t)q(t) w t Z t dt er j v(R( j ), K j , j )
j1
k
,
�Rj (t) s[A, K j , R,q,t], R 0 R0 A 0 , K0 , and R(T ) 0,
Econometric Model
lnQit 0 jj1
M
ln Zijt j lnj A Aijt F ln Fit C lnCit j
j D Dijt e1it
ln Fit 0 jj K ln Kijt j ln
j A Aijt j
j D Dijt e2it
lnCit 0 jj K ln Kijt j ln
j A Aijt j
jD Dijt e3it
Data
• 111 shale gas wells located in the US- 39 horizontal wells- 72 vertical wells
• all wells began production since 2007
• have between 30 and 720 days of production data
• reservoir characteristics
• completion and production choices
• RESERVIOR CHARACTERISTICS- permeability thickness- initial reservoir pressure- perforated interval
• COMPLETION- hydraulic fracturing fluid - proppant- Injection rate- treating pressure- stages- surfactant concentration- winter fracture- time to complete
•THE RESULTING COMPLETION PARAMETERS- fracture Half-length: final and early- fracture Conductivity
• MANAGEMENT AND TIME- 10, 30, 60, 90, 1870, 360, 720 days- ratio: production days to calendar days
BASIC RESULTS
• Consistency across technologies in EQ1- Initial Reservoir Pressure (+), - Permeability Thickness (+)- Fracture Half Length (+),- Dimensionless Fracture Conductivity (+), - Difference (-), - Days (i = 30, 60, 90, 180, 360, 720).
- CNF (+)
• Consistency across EQ2 and EQ3
But these only include the direct impacts from each equation
Direct and Indirect Effects
Qi t Kim0 0
t
(hit Kim0
direct� �� ��
hit Fim0 Fim0 Kim0
indirect� �� � � �� � �
hit Cim0 Cim0 Kim0 )indirect
� �� � �� �� � � � dx
CUMULATIVE PRODUCTION ELASTICITIESVERTICAL HORIZONTAL
Variable Elasticity SE Prob>0 Elasticity SE Prob>0Reservoir Characteristics
Initial Reservoir Pressure 2.335 0.33 1 0.521 0.234 0.987Permeability Thickness 0.564 0.027 1 0.44 0.029 1Perforated Interval 0.075 0.068 0.863 n.a. n.a. n.a.
Completion OutcomesFinal Fracture Half-length 0.509 0.088 1 0.354 0.046 1Early Fracture Half-length 0.177 0.034 1 0.268 0.037 1Dimensionless Fracture Conductivity 0.433 0.219 0.976 0.213 0.135 0.943
Completion ChoicesCnF 0.062 0.029 0.984 2.251 0.486 1Surfactant n.a. n.a. n.a. -0.027 0.016 0.055Average Proppant per Stage 0.0017 0.029 0.523 -0.182 0.102 0.037Proppant Concentration 0.11 0.057 0.972 0.213 0.135 0.943Average Injection Rate 0.027 0.042 0.738 0.237 0.056 1Average Treatment Pressure -0.314 0.124 0.006 n.a. n.a. n.a.Difference -0.221 0.035 0 -0.124 0.034 0Stages n.a. n.a. n.a. 0.19 0.047 1
ProductionRatio 0.541 0.218 0.994 -0.00088 0.0414 0.491
SAME SIGN; DIFFERENT SIGN
DISCRETE EFFECT IMPACTS ON CUMULATIVE PORDUCTION
VERTICAL HORIZONTAL
Variable Semi-elasticity SE Prob>0 Semi-elasticity SE Prob>0
Completion Choices
Winter Fracture -0.0064 0.04 0.436 -0.0814 0.079 0.151
CnF Intercept n.a. n.a. n.a. 15.351 3.3 1
Summary
• Reservoir characteristics expected impact, butdifferent magnitudes
• Completion outcomes consistent but diminishing returns
• Completion choices vary
• CnF positive impact
Conclusions• Vertical and horizontal wells respond differently
• Conventional wisdom from vertical well history may not be appropriate for horizontal wells.
• Results are preliminary and only for early period production
• On-going research with expanded data set
Regulatory Implications• Shale gas completions and production choices may impact ultimate recovery
What does this imply for natural gas as a transitionenergy source?
What does this imply for conservation regulation?
• Bigger completions jobs may not always be better
Does this have environmental implications?
• CnF, a relatively benign additive out performs traditionalsurfactants
What does this imply for environmental regulation?
Thank you.
Working paper with technical details:http://papers.ssrn.com/sol3/papers.cfm?abstra
ct_id=2162486and
http://www.rci.rutgters.edu/~rpatrick/hp.html
Questions and comments:[email protected]
Horizontal and Vertical Wells
DATA DESCRIPTION
DESCRIPTIVE STATISTICS
HORIZONTAL RESULTS
VERTICAL RESULTS
Forecast Contributions of Shale Gas
From EIA Early Release AEO 2012