Help on #well to deplete reservoir?

[petengr]

Dear All,

In practise, can someone explain the best way to determine the required no. of wells to deplete a n-bbls in place?

thanks!

[vinomarky]

It's an economic decision

Simulate 1, then 2, then 3, then 4 wells etc.... ensuring appropriate well and field level controls are applied commensurate with the matched facilities plans and calculate the NPV of each scenario with their respective costs

[petengr]

but before running economics, number of wells are determined on technical basis; reserve expected to be depleted, reservoir properties like k, fluid properties like oil viscosity.

[temr]

Hello, Petengr.
The question you raise is very complex since it involves several disciplines which are
1. Resrvoir engeeniring - to create subsurface model
2. Well design and infructructure engeeniring - to create exact wells and facilities to handle project oil,gas,water rates
3. Marketing - to plan routes for sales and culculate final Net price for oil and gas
4. Cost engeeniring - to estimate capital operational, non operational, administrative costs
5. Fiscal - to fit cash flow exactly to choosen PSA terms or current fiscal system
6 Economics - to calculate key economical indicators like NPV, ROR, IRR, PVR etc.
As you can see this is question of big project company and in reality this is so, but if you whan to try i can explain logic befing this process...
the main startegy here is maximising your NPV nad IRR , since all oil companies has share holders who whants more profit on any dollar envested so
Do do this you need to create several paternt of will spacing + include cases with injection since pressure drop in reservoir could lead to changes in oil production.
Create several cases on natural deplition, run cases calculate economics .
Choose 3 cases from that you ve done with less , mid , high count of wells
Create injection case
Calculate economics
range caseses based on IRR and NPV.
The main problem here is operating and capital cost of drilling and surface infrastructure
So use questor onsore or offshore software for expenditures

[vinomarky]

Petengr - Incorrect

Number of wells is not a technical decision, it is purely an economic decision. In an extreme example, one well can conceivably drain any connected reservoir situation given enough time.

Agree with Temr, that you need to ensure all your technical characterization is correct, but once you feel it is, the answer is still driven by economics.

[petengr]

Petengr - Incorrect

Number of wells is not a technical decision, it is purely an economic decision. In an extreme example, one well can conceivably drain any connected reservoir situation given enough time.

Agree with Temr, that you need to ensure all your technical characterization is correct, but once you feel it is, the answer is still driven by economics.

vinomarky - inaccurate(Incorrect)

Sure, if in a foreign country, where may be your company is exploring and carrying out all the exploration operations(100% CAPEX) and with low share in production/income, Economics play big role in deciding #wells, especially if low production is expected. sure with that scenario, you think only economics if you are top management, however, if you are an engineer, you think both technical and economics!


"In an extreme example, one well can conceivably drain any connected reservoir situation given enough time. " ? For how long? not possible.

Just think it through, for reservoirs; e.g. one with average k=2md, another with 100md, will the well density be the same for both.

How small a reservoir could be that one well can deplete it?

Thanks for your help!

[petengr]

Petengr - Incorrect

Number of wells is not a technical decision, it is purely an economic decision. In an extreme example, one well can conceivably drain any connected reservoir situation given enough time.

Agree with Temr, that you need to ensure all your technical characterization is correct, but once you feel it is, the answer is still driven by economics.

vinomarky - inaccurate(Incorrect)

Sure, if in a foreign country, where may be your company is exploring and carrying out all the exploration operations(100% CAPEX) and with low share in production/income, Economics play big role in deciding #wells, especially if low production is expected. sure with that scenario, you think only economics if you are top management, however, if you are an engineer, you think both technical and economics!


"In an extreme example, one well can conceivably drain any connected reservoir situation given enough time. " ? For how long? not possible.

Just think it through, for reservoirs; e.g. one with average k=2md, another with 100md, will the well density be the same for both.

How small a reservoir could be that one well can deplete it?

Thanks for your help!

[vinomarky]

I guess we may have to agree to disagree

You scenario of 2mD vs 200mD is a good one to explore - you rightly point out that the number of wells to develop it would be different, but why?

If you waited 100 years or so - on a technical basis - you'd get the same recovery (with obvious exceptions related to things like tenure periods etc)

As an example, for a given field with no internal baffles, why would you select 6 wells, not 5 wells or 7 wells? If you don't have any economic rate or time limits, then 1 well will generally give you similar ultimate technical recoveries (except situations like outrunning aquifer influx for gas fields)

The reason that you'd likely have more wells in the 2mD case is because of economic abandonment rates, and the time value of money. You still need to have properly technically characterized the field in order to do the economics, but if you are deciding on a purely technical basis what the developable reserves are then either (a) you are doing it wrong or (b) implicitly in your technical work you are already integrating some shorthand economic modelling anyway - for example rules of thumb that you should design to be on plateau for a certain portion of the of the project life, what the maximum project life is, or one well will 'develop' a certain area etc.... - Like it or not, these are ECONOMIC criteria that you are already incorporating

There's nothing wrong with this as a way to more efficiently arriving at a preliminary development plan envelope of options to consider - but you should still test the options by subsequent economic modelling to (hopefully) validate your earlier assumptions.

5, 6 or 7 wells?.... Technical work alone will rarely give you the answer.

[petengr]

I guess we may have to agree to disagree

You scenario of 2mD vs 200mD is a good one to explore - you rightly point out that the number of wells to develop it would be different, but why?

If you waited 100 years or so - on a technical basis - you'd get the same recovery (with obvious exceptions related to things like tenure periods etc)

As an example, for a given field with no internal baffles, why would you select 6 wells, not 5 wells or 7 wells? If you don't have any economic rate or time limits, then 1 well will generally give you similar ultimate technical recoveries (except situations like outrunning aquifer influx for gas fields)

The reason that you'd likely have more wells in the 2mD case is because of economic abandonment rates, and the time value of money. You still need to have properly technically characterized the field in order to do the economics, but if you are deciding on a purely technical basis what the developable reserves are then either (a) you are doing it wrong or (b) implicitly in your technical work you are already integrating some shorthand economic modelling anyway - for example rules of thumb that you should design to be on plateau for a certain portion of the of the project life, what the maximum project life is, or one well will 'develop' a certain area etc.... - Like it or not, these are ECONOMIC criteria that you are already incorporating

There's nothing wrong with this as a way to more efficiently arriving at a preliminary development plan envelope of options to consider - but you should still test the options by subsequent economic modelling to (hopefully) validate your earlier assumptions.

5, 6 or 7 wells?.... Technical work alone will rarely give you the answer.

There is no harm in disagreeing with someone's opinion. It shouldn't be like; "my opinion against yours." I highly appreciate your time trying to help, thank you!

Never said that pure technical will give the answer on #well. It is technical that will, 1st, give a hint on #wells e.g. 7, 8, 12, , , then running the economics will give a clear picture on what option to choose, for example; Low POT, high NPV, ...., ROR, .. etc.

, you think both technical and economics!

[petengr]

thanks!