Number 19, 1997 Middle East Well Evaluation Review

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1 2 Number 19,

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3 B A C K T O T H E F U T U R E The oil industry has undergone major changes over the past decade. In the early 1980s the industry was driven by market forces and best guesses from oilfield personnel who found it difficult to manage and interpret data effectively. The oil price crash of the mid-1980s was a turning point for many companies. It heralded a new era of downsizing and outsourcing as oil companies focused on their core business the management of oil and gas assets. The new approach involved a greater role for technology. This included new imaging techniques, improved seismic methods and computer databases that offered rapid access to all of the well data from a field. The early 1990s saw a more considered approach to environmental issues and a higher priority being placed on the health and safety of employees. By the mid-1990s the industry had become leaner and more cost-effective, with decisions being made on the basis of science and technology rather than guesswork In this article Mohamed Watfa reviews the major technological changes that have influenced the industry through this period, and explains how increased reliance on technology has squeezed the guesswork out of oilfield development

4 The oil industry has changed dramatically since the end of the 1970s. At that time the oil and gas sector was extremely inefficient and relied on some very basic technologies and trial and error working practices. Data handling, for example, was in its infancy in the 1970s. And oilfield interpretation was paper-based and maps or seismic outputs were usually coloured by hand. Twenty years ago there was almost no interaction between specialists in different oilfield disciplines. Geophysicists depended on 2D survey data and simple visual interpretation of their data. Petrophysical analysis of log data was based on the empirical equations developed by Archie and others, and reservoir testing and analysis relied on elementary surface pressure measurements. In the absence of reliable reservoir models major decisions about oilfield development were driven mainly by market forces (Figure 1.1) and by guesswork, with science called upon occasionally as a problem-solving tool. In the Middle East there seemed little reason to worry. Controlling most of the world s hydrocarbon reserves (Figure 1.2), the countries of the Middle East were in control of the global oil supply. Most people believed that the region s giant and supergiant oil fields would give trouble-free production for many years and that the flow of oil or gas could be turned on or off to meet market demand. The first major changes to traditional working practices emerged in the early 1980s. Mainframe computers became commercially viable and added a powerful new dimension to data acquisition, processing and interpretation. Attempts were made to integrate well data to develop a more logical approach to interpretation. New tools, such as GLOBAL* and ELAN* software, began to break down the interpreter s reliance on empirical formulae by enabling data to be weighted according to reservoir conditions, geological models, well constraints and local knowledge. This revolution in data management meant that data acquired years earlier could be reassessed and calibrated with new well logs, to provide a more reliable basis for reservoir interpretation. Figure 1.1 MARKET FORCES. In the 1970s oil exploration and production decisions were driven by the international markets rather than by oilfield science and technology possibilities afforded by the power of mainframe computers. In 1983 ADNOC started to develop a new concept in data management the multiwell database (MWDB). The idea was simple: if geoscientists could compare log data between wells they would have a much better picture of areal changes across the reservoir. Reservoir engineers knew Latin America Middle East Former USSR and Eastern Europe USA Africa Canada UK and Europe Australia and Far East that a 1% improvement in oil recovery would increase production by millions of barrels a good return on investment. As a custodian of oilfield data, Schlumberger was in an ideal position to help with this ground-breaking project. ADNOC and Schlumberger formed an alliance, an unusual arrangement in the early 1980s, to share the workload. ADNOC x6 ADNOC promotes lateral thinking The Abu Dhabi National Oil (ADNOC) was the first company to seize on the new field-wide interpretation Figure 1.2 PLAIN SAILING? In the 1970s most oil and gas producers in the Middle East were producing huge volumes of hydrocarbons from giant and supergiant fields. There were few indications of the reservoir complexity that would be a major focus of oilfield research in the 1990s

5 Figure 1.3 Multiwell databases brought together all relevant field information in one place for the first time. Geoscientists could organize and access data without time-consuming searches through paper logs Figure 1.4 The DSA tool helped to revolutionize the quality of seismic images in geologically complex areas defined how it wanted well data to be handled and presented, and set up a joint team with Schlumberger to guide, test and develop the concept. The new database (Figure 1.3) was operational within two years and has guided field development in Abu Dhabi ever since. ADNOC s MWDB now covers all the wells in Abu Dhabi and is accepted as the world s first comprehensive national oil company database. The arrival of the MWDB had a major influence on the oil industry. For the first time companies could use in-house software to organize data and apply their knowledge in an effective way. Digital data handling eliminated the time-consuming delays associated with searching and comparing paper records and allowed oilfield experts to bring all of their data to a consistent quality. Seismic surveys go downhole The shift towards field-wide studies was boosted by other technology milestones in the 1980s. The development of the DSA* Downhole Seismic Array tool (Figure 1.4) enabled geophysicists to acquire well seismic data in the form of vertical seismic profiles (VSPs). The improved data clarity and enhanced fault analysis that this new technique provided was an invaluable aid to the understanding of complex carbonate sequences where salt and anhydrite masked detailed structures. Walkaway VSPs were used to great effect in areas such as the Gulf of Suez where complex geology and thick salt layers obscured deep structures (Figure 1.5); they provided excellent resolution of seismic events in the region around the wellbore. RecentÐPliocene Cretaceous Eocene Ras Malaab Group Nubian Gharandal Group Basement Ras El Wa'ar structure Gebel Qabeifat Gebel Gharib W East Gebel Gharib Basin Kareem El Ayun West coast July Ramadan A-2 Alef-1 Gebel Araba El Qaa Plain East coast Gebel Ghuweira Depth (ft) 0 E 5,000 10,000 15,000 20,000 Figure 1.5 The Gulf of Suez is a major oil and gas producing region where reservoir structure and development are controlled by extensional tectonic forces. These forces have created a set of hydrocarbon-bearing grabens 7

6 Information technology in the E&P industry Information technology (IT) has been one of the most powerful factors in the survival and rebirth of the upstream oil and gas industry since the 1986 price collapse. Many experts believe that IT will be even more important to the industry s future, shaping business strategy and providing competitive advantage to those who can use it effectively. At present information technology is a large expense for the E&P industry; some estimates show that the industry spends an average of US$0.25 on IT for every barrel of oil it produces. The industry s achievements in the past 10 years underline its resilience and the resourcefulness of its members. What would have happened to the industry without the innovations of the past decade? If 3D seismic methods and horizontal drilling technology had not been developed to commercial application the industry would almost certainly have stagnated and contracted, with companies concentrating on low-cost areas of operation at greatly reduced quality. The same is true of IT applications within the industry; the replacement of mainframe computers with powerful workstations and desktop PCs has altered working practices for everyone. The E&P industry s main competitive strategy to date has been cost-cutting. Many experts believe that this approach to efficiency, essential in the 1980s, is now beginning to show diminishing returns. More and more E&P companies are looking beyond the search for direct savings and directing their efforts at a sustainable growth driven by new technology. The main role for IT in the years ahead is likely to be as a tool in the search for growth. Corporate communications: the information access problem Traditional information management methods delivered information to selected targets (Figure 1.6a) using a variety of media. The modern alternative is a search and access approach (Figure 1.6b) which makes the same information available to everyone at a central point. The search and access approach promotes a free exchange of information within the company and ensures that every - one has access to relevant data. (a) (b) Figure 1.6 The traditional directed communication systems (a) where individuals are targeted as recipients can be replaced by a search and access scheme (b) where interested parties can seek the information they require The search and access approach is only becoming possible through the Internet. Under the search and access system everyone can contribute their thoughts on a problem without increasing the length of the decision-making process. Current expectations within the E&P industry do not include wholesale shifts onto the Internet, but it seems likely that more and more companies will make use of the Internet and its technologies to enhance their internal communication systems. The next step will be to link these intranets together so that companies can communicate more efficiently with their partners, suppliers, clients and contractors. Of course as systems become more closely linked and more people have access to commercially sensitive data, concerns about security will increase. Developing and maintaining effective barriers to unauthorized users will be a continuing part of data management. The World Wide Web (WWW) is rapidly becoming accepted by the oil and gas industry as a research and development tool. The potential benefits and pitfalls of the Internet are discussed in detail in Caught in the Web, in this issue. At present the WWW is the most fashionable IT tool, but various other technologies may alter the way E&P companies operate in the future. 8

7 The good old days? Ten years ago a geologist returning to the office to study acreage for a potential bid would have gathered all available data and generated a base map on the mainframe computer. This map would then have been updated by hand and the geologist would have checked with colleagues to see what was stored in their offices. Someone would have visited the data room to order paper copies of seismic data or, if a workstation was available, to start tracking down the tapes (archived and forgotten in another office) for data loading. Copies of well logs would have been plotted on paper and some attempts would have been made to find digital copies that could be placed in the mainframe s logmodelling program. Gathering all of these data and associated reports would have taken about a month before any interpretation work could begin. If, once the project was complete, the company decided not to bid for the block the geologist would have put everything in a box and sent it back to the data room for archiving. The digital well logs and tops would have been saved to a diskette, but probably not well enough labelled to be identified a year later. The new workstation interpretation, with 20 horizons and 14 velocity and depth maps, would have been stored on tape and thrown to the back of a desk drawer. Here and now The modern oil-company geologist spends more time with keyboard and mouse than with hammer and hand lens, and even in the field a portable computer with a global positioning system is a useful accessory. How else have oil and gas companies benefited from IT over the decade? The major gains have come from sheer computing power. Modern workstations match the performance of the company s centralized mainframe computer in Improvements in the capacity to handle data have led to a qualitative change in the ways they are used. Ten years ago some staff had a PC on their desk; in 1997 it is unusual for staff not to have their own PC, and the staff who had a PC 10 years ago now have an interactive workstation as well. Portable computers are more common, and with the arrival of laptops that can actually be used on someone s lap, the industry is open for business at any time and in almost any place around the world. The growth of the software market means that the smaller E&P companies now have access to specialist programs that could never have been developed in-house. Exploration staff can now extract more information, more quickly, from greater volumes of data. The 2D seismic survey is being replaced by 3D data both on- and offshore. In the late 1980s, 3D was rarely used as an exploration tool although it was well established as a field development tool. Sharing the model The shared earth model has been a longterm goal for the various disciplines within E&P asset teams. The hardware and software dimension of this problem are in sharp focus with efforts being made by many suppliers of oilfield software to allow closer integration of engineering, geophysical, geological and petrophysical data within a single model. Figure 1.7 THE GEOLOGIST S NEW HAMMER AND LENS. In the modern oil company office all relevant geological information is digital. It can be accessed quickly, manipulated and passed on to colleagues or sent for secure digital archiving Schlumberger was one of the first companies to develop workstations that could manipulate geological information (Figure 1.7). The ability to examine geological data in new ways, and to extract information that would be of relevance to other members of the asset team, encouraged cooperation between geoscientists. The advantages of having data shared between disciplines will be enhanced if the ideas behind the data can also be shared. Systems that allow visualization of the reservoir, even though they make heavy demands on computing power, allow oilfield professionals to share their understanding of the model. 9

8 Geology changes its image All oilfield disciplines experienced major changes in the 1980s. Oilfield geology took a huge leap forward in 1986 with the arrival of the Formation MicroScanner* tool the first borehole electrical imaging device. The detailed, core-like images provided by this revolutionary new tool (Figure 1.8) revealed the complexities present within the region s oil and gas reservoirs for the first time. Bedding orientation and dip, faults and fractures and sedimentary features such as grading could all be measured directly from the images. This ability to observe and qualify fracture events was a tremendous improvement on the standard log analysis techniques of the time. Geologists finally had clear evidence that many of the Middle East s reservoirs were Figure 1.9 Crossbeds are an important indicator of reservoir structure. The angle of crossbeds can help a geologist to determine depositional environment and direction of sediment transport. The lowangle crossbeds in this Formation MicroScanner image are characteristic of fluvio-deltaic facies 10 Figure 1.8 This early Formation MicroScanner image of a Cretaceous sandstone in Egypt s Western Desert shows a large slump with overturned bedding. The quality of borehole images has improved dramatically over the past 10 years highly fractured. In time this realization would change the production and drilling practices of many of the region s operating companies. In some cases, the selection of well trajectories to intercept more open fractures increased hydrocarbon production 10-fold. In other cases open fractures are the main conduit for excessive water production and must be avoided. The understanding of fracture systems also opened up a way of obtaining a thorough knowledge of major structural deformation events. These events are important, because geologists must construct an accurate 3D geological model that can be upscaled for use in reservoir simulations that predict production performance. This new emphasis on structures has been reflected by a number of Middle East Well Evaluation Review articles on faults, grabens, super-structures and fold belts. The ability to quantify fracture aperture, orientation and density encouraged oilfield experts to include image data in their petrophysical models. This level of integration increased when borehole imaging techniques began to offer quantitative information on porosity types and volumes. Used quantitatively, borehole images were helping geologists to understand the nature of the porosity changes in the reservoir sequences. This allowed them to characterize heterogeneities in carbonate depositional cycles and incorporate their findings in improved petrophysical models. Borehole imaging methods continued to develop and improve, making it easy for geologists to provide the quantitative information petrophysicists needed. In sand shale sequences, the higher resolution of Formation MicroScanner imagery gave a much better understanding of depositional environments and accurate crossbed information (Figure 1.9). These data were required to determine reservoir geometry and to guide well planning. By the early 1990s many reservoir engineers had come to rely on images from the Formation MicroScanner tool and from the new FMI* Fullbore Formation MicroImager tool for planning and for the qualification of test data.

9 The oil price crash of 1986 N u m b e r 2 0, M i d d l e E a s t We l l E v a l u a t i o n R e v i e w 11

10 Pressure measurements come out of storage Reservoir engineering methods evolved rapidly in the 1980s. Pressure testing and flow measurements moved downhole in cased holes. This change provided higher resolution data, and eliminated many of the wellbore storage effects which had hampered surface measurements. Pressure and pressure-derivative data could be analysed to determine the transient behaviour of multiple layered formations. Type curve analysis was revised and geological constraints started to be used to aid the interpretation of pressure plots (Figure 1.10). At the same time, new efforts were being made to perforate and test wells simultaneously and to obtain critical flow rate data to combine with pressure transient data from producing zones. Combining these data with the openhole single-probe data, the reservoir engineer could assess permeability layering effects in the reservoir and optimize well completion strategies. New interference testing campaigns provided a wealth of important data about connectivity between wellbore and reservoir in numerous fields. Some of these tests indicated considerable horizontal permeability anisotropy, associated with fractures and regional stress patterns in the fields. In other cases, communication along and up or down faults could be obtained, demonstrating the need for different depletion strategies in some reservoirs. Figure 1.10 On-screen type curve analysis. Integrating this kind of analysis with detailed geological constraints led to an improved understanding of the reservoir Making m work The relationship between rock resistivity and water saturation, porosity and water resistivity is presented in the Archie equation: R t = R w f m S w n where R t is rock resistivity, R w is water resistivity, f is porosity, S w is water saturation, n is the saturation exponent and m is the cementation exponent. Changes in the cementation exponent (m) affect water saturation computations. An incorrect value for m can have disastrous consequences for the accuracy of fluid analysis predictions and, subsequently, on well completion and testing. Figure 1.11 Varying the m factor in the Archie equation gives much more realistic fluid analysis results (track 3), than the traditional, constant m log (track 4), which shows far too much hydrocarbon. Note the relationship between m and the percentage of vug space in the sequence (track 2) 12

11 The most fundamental problem with equation-based solutions is the lithologydependent variability of the m factor. This variation should be taken into account when assessing fluid content. Comparison of tracks 3 and 4 in Figure 1.11 shows how using a constant value of m in saturation computations can produce misleading results. Using a single value for m (track 4) indicated the presence of hydrocarbons in the lower part of the section, but only water was indicated in this section when variable m values were applied to the equations. Tests conducted on Zone B confirmed the presence of oil-free water and this interval was plugged before Zone A was tested. Dry gas was produced from Zone A. This showed well analysts the importance of pore geometry and fluid wettability. US dollars per tonne World events Iranian oil production suspended Iranian production resumed Start of Iran/Iraq war Premium gasoline Gas oil Heavy fuel oil End of coalminers' strike in UK OPEC introduced netback pricing Iraq invaded Kuwait Time to turn to technology The host of new technologies that emerged in the mid-1980s, and ever-increasing computer power, proved to be very timely for the oil industry as the worldwide fall in oil price began to bite (Figure 1.12). To remain competitive, companies had to find more efficient ways to manage fields and ensure reliable long-term production. By the mid-1980s reservoir engineers were beginning to notice the damage that had been inflicted by market-driven production strategies pursued in the 1970s. Some of the Middle East s giant oil fields started to develop problems with earlierthan-expected water production and unforeseen drops in reservoir pressure. A worldwide rethink of field management practices was needed and data integration became the new industry priority. By 1987 the emergence of new technology was starting to force the pace of change. Computing power increased at an exponential rate and stand-alone workstations and PCs began to arrive on peoples desks. The Schlumberger Image Examiner workstation was the first on the scene and transformed single well analysis of highdensity imaging data. For the first time geologists and geophysicists found themselves on the same playing field as petrophysicists and reservoir engineers. The Image Examiner allowed experts to compare data between disciplines the start of real integration Year Figure 1.12 Low oil prices during the past 10 years have changed the oil industry. The price crash of 1986 was painful but it transformed the sector into a lean, cost-efficient industry Within Schlumberger the sharing of ideas between specialists was also encouraged by the introduction of SINet, the Schlumberger International Network that linked research centres around the globe. The company was one of the first to realize the impact that and efficient file transfer would have on their operations. However, few at the time thought that within 10 years the company would have the world s largest intranet and see data transfer traffic increase by more than 800% annually. Now, through advanced communications such as the LOGNET* satellite communications network (Figure 1.13), logging operations can be observed in real time, back at headquarters. By the end of the 1980s cost-effective reservoir management was seen as the industry s ultimate goal. New products such as the Charisma* seismic interpretation software were being used worldwide to carry out full field investigations. These powerful new systems allowed engineers to create and develop reservoir models that only a few years earlier would have taken years to build. Figure 1.13 The LOGNET satellite system allowed Schlumberger to transmit log information direct from the wellsite to client offices around the world. In the future this information sharing will be achieved by posting logs in passwordprotected sites on trusted Web servers 13

12 The Gulf War, Figure 1.14 Oil wells burning out of control in the aftermath of the Gulf War In the early 1990s international conflict came to Kuwait. The country s oil and gas infrastructure was badly damaged during the fighting and the environment suffered as huge volumes of oil and gas were spilled in the Gulf or burned out of control (Figures 1.14 and 1.15) in oil fields across the country. A huge international effort was required to control the fires and then to repair the damaged wells. The uncertainty that surrounded oil supply during the war produced a dramatic spike in oil prices. However, prices subsided to prewar levels within a few months, and in the long term, the conflict had surprisingly little effect on the international oil price. Figure 1.15 The oil fires in Kuwait cost billions of dollars in damage to facilities and in lost production. International teams of fire fighters worked around the clock to control the flames and restore production 14

13 The acceptance of 3D seismic surveys as an E&P development tool was brought about by improvements in acquisition technology that reduced data processing times from several months to a few weeks. This was an exciting development for geoscientists, with the new 3D surveys providing a continuous structural image of the reservoir without the need for extrapolation and interpretation. The 3D seismic method also provided a solid framework for integration of single well data and crosscalibration of multidisciplinary data. Figure 1.16 The ARI tool allowed log analysts to gather information about the beds on either side of a horizontal well selectively rather than averaging values Sidewall measurement Circumferential measurement Radial measurement Selective radial measurement Horizontal wells on the horizon Figure 1.17 The latest LWD technology, the RAB tool, records detailed images of the borehole for later analysis. The imaging facility can be switched on or off, allowing the operator to select specific well intervals for detailed examination N u m b e r 2 0, At the end of the 1980s outstanding production increases were being achieved using horizontal wells. This encouraged many companies to view horizontal drainholes as an alternative to vertical wells, rather than expensive solutions to be used in problem fields. In the Middle East, companies such as Petroleum Development Oman (PDO) seized on new horizontal drilling techniques to increase production efficiency in many of their fields. Guided by enhanced 3D seismic images, many companies embarked on ambitious horizontal drilling programmes a trend that was spurred on in the 1990s by the development of seismic-while-drilling (SWD) and geosteering techniques. The increasing popularity of horizontal wells posed a problem for log analysts: how could they adapt measurement systems designed for horizontal beds in vertical wells to investigate horizontal beds in horizontal wells? Imaging has played a crucial role in the analysis of horizontal well data and interpretation problems were eased by the introduction of systems such as the ARI* Azimuthal Resistivity Imager tool (Figure 1.16) which makes selective radial measurements to evaluate the beds lying above or below a horizontal wellbore rather than calculating an average for both. The ARI tool can also be used to characterize low resistivity fractures. Logging-while-drilling (LWD) techniques were introduced in the early 1990s to overcome problems associated with invasion corrections. The latest LWD programmes use the RAB* Resistivity-at-the-Bit tool (Figure 1.17) which can record and store image data. Petrophysicists found their job increasingly complicated as they were asked to evaluate data from a range of different sources, and to present models that incorporated all of the information. M i d d l e E a s t We l l E v a l u a t i o n Re v i e w 15

14 Horizontal well optimization onshore Abu Dhabi For many years the oil and gas industry has faced major problems in developing heterogeneous carbonate reservoirs. Careful planning is required to recover the oil from these reservoirs and horizontal wells are proving the most effective approach. In this study the Simsima Formation provided an extremely heterogeneous target onshore Abu Dhabi (Figure 1.18). The formation is dominated by dolomitic limestone with matrix and porosity distributed randomly through the rock in patches of varying sizes. The porous zones in the formation are separated from each other by dense nodules or areas of cemented limestone. After an initial development period that relied on vertical wells, it was decided to develop the target with horizontal techniques. Production from the vertical wells was erratic, but it was hoped that horizontal wells would improve the situation. The first and second horizontal wells (H1 and H2) were drilled in a south-west direction in an effort to place them in a high position within the reservoir structure in the hope that this would reduce the risk of early water production. Unfortunately, when these wells were brought onto production the results were disappointing. A programme was started to determine why the results from these wells had been so poor and to ensure that subsequent horizontal wells would be more successful. Vertical well Horizontal well Horizontal well orientation Fracture orientation Figure 1.18 A structural contour map of the Simsima reservoir showing wells and fracture orientation Well H5 Study time A wide-ranging study of the field was conducted. A multidisciplinary team examined borehole images, well logs, cores, 3D seismic data around projected well locations and a stochastic reservoir model (Figures 1.19 and 1.20) in an effort to explain well performance and enhance the production potential of future wells. A wide range of factors, including spacing of offset wells, pore systems, permeability barriers and fracture orientations, was considered and, after integration of all available data, the study concluded that the Simsima Formation was heavily fractured. The highest fracture density in the Simsima carbonates was recorded in vertical wells near the structural crest of the field. This was in stark contrast to the situation in the horizontal wells, where few fractures were encountered. Figure 1.19 A stochastic model of permeability variations in the Simsima reservoir showing the trajectory of a horizontal well relative to the high-permeability target zones 350Ð500mD 25Ð50mD 0.01Ð0.5mD 16

15 Unit R1 Unit R2 Sucrosic dolomite Tight dolomite Grainstone to packstone Mouldic dolomite Mudstone and wackestone Figure 1.20 Lateral and vertical heterogeneity encountered in the Simsima Formation is the result of extreme diagenetic and tectonic processes. The target units R1 and R2 are multilayered and each of the facies present has distinct permeability characteristics Detailed study of cores, structural curvature maps and Formation MicroScanner images identified open fractures in all reservoir units. Fracture analysis suggested that the longitudinal fractures striking northeast south-west in the anticline were dominant structures. Guided by the findings of this study, geoscientists decided the kickoff directions and trajectories for future horizontal wells. New wells drilled for the R1 unit were kicked toward the north-west perpendicular to the fracture trend. Two new wells were drilled in R2 the first perpendicular to the fracture trend and the second parallel to the fractures. Geoscientists hoped this would enable them to determine the role that fractures played in production. The new horizontal wells drilled in R1 produced up to six times more oil than the best vertical wells in the reservoirs. Conclusions Horizontal wells are generally very beneficial in complex, highly heterogeneous reservoirs. They penetrate the permeability barriers which exist within the reservoir, whereas vertical wells often intersect only a single reservoir compartment. Fractures are known to influence reservoir performance. The characteristics of the fractures in the Simsima Formation will have a direct bearing on the planning of future wells as engineers balance production rates against the risks of water breakthrough. Workstations that integrate data from different sources allow geo-scientists to construct and test 3D well design entirely within the computer environment a situation that provides engineers with riskfree evaluation of various well trajectories. 17

16 Figure 1.21 MAKING WAVES. Environmental issues have become increasingly important throughout the 1980s and 1990s By the early 1990s a wave of new technology was arriving in the oil field. Sustained spending on research and development by Schlumberger during the 1980s paid off as companies seized on new technologies such as tubing conveyed perforating (TCP), the RST* Reservoir Saturation Tool, the ASI* Array Seismic Imager tool, the CSI* Combinable Seismic Imager tool and the high-resolution Formation MicroScanner service. Data handling and management advanced at this time with the development of UNIX-based integrated workstations linked via the Finder* data management system. The barriers between oilfield disciplines began to crumble as geoscientists began to use integrated workstations to test numerous what if scenarios. Multiwell workstations could be combined through the GeoFrame* software. Reservoir modelling and simulation had come of age. The success of the project led to other major studies, such as those of Saudi Arabia s giant Marjan and Safaniya fields. As the oilfield experts knowledge of reservoir behaviour increased, strong demand arose for improved saturation monitoring. Complex waterflooding in many fields leads to mixing of waters with different salinities and when this occurs the carbon oxygen data, provided by the RST tool, are needed in order to interpret results. Such measurements are now used in the latest production logging measurements to predict water holdup and flow rates in horizontal wells. Sharper images for a clearer understanding At the field acquisition level the introduction of the MAXIS 500* wellsite surface instrumentation system meant that huge amounts of data could be transmitted from downhole and analysed at the surface in real time. This paved the way for the arrival of more imaging tools such as the FMI tool, AIT* Array Induction Tool and the ARI tool. These have revolutionized our understanding and identification of complex formations such as thin-bedded reservoirs. The AIT tool has been particularly important as it gives an insight into the Iran s giant field studies In the 1990s new computer technology allowed reservoir engineers to conduct detailed studies (including reservoir characterization) of complete giant fields for the first time. In 1992 the Iranian National Oil commissioned Schlumberger to make a four-year study of Ahwaz Field, the biggest ever attempted. The field had over 200 wells that had been on production for over 30 years. Simulation and history matching were carried out for pressure variations and field-wide time-lapse saturation maps were made. Figure 1.22 The Green Dragon burner is a clean and efficient way to dispose of unwanted hydrocarbons 18

17 Traditional Alliance Integrated Services Oil Service Oil Service Service Oil Integrated Group Service heterogeneities and anisotropy around the borehole. This has been fundamental to our understanding of reservoirs at the large scale and proved critical for accurate modelling and simulation. Environmental issues surface Concern for employee health and safety and for the environment has increased since the mid-1980s. The Piper Alpha disaster in the UK Sector of the North Sea and various pollution incidents, coupled with growing concern about global warming, has pushed environmental issues to the top of the agenda (Figure 1.21). This had led to the development of numerous innovations aimed at reducing environmental risks. For example, the Green Dragon* high-efficiency burner enables gases released during well testing to be burned without causing pollution (Figure 1.22). Service Integrated Alliance Integrated Project Team Service Service Service Figure 1.23 Close cooperation between oil producers and service companies is helping to improve efficiency in the oil field. Shared risks and shared benefits encourage closer relationships based on mutual benefit Also, the inherent dangers of tools sticking in horizontal wells prompted Schlumberger to introduce a unique range of logging tools with retrievable radioactive sources. In some cases the need for radioactive and chemical sources has been eliminated by introducing tools such as the IPL* Integrated Production Logging tool that uses an electronic source to provide nuclear/porosity measurements in openhole. The latest addition to the family of clean, nonradioactive-source tools is the CMR* Combinable Magnetic Resonance tool which is having a major impact on the evaluation of the hydrocarbon content of reservoirs, and in the assessment of recoverable oil. Recently many of these innovative technologies have been combined within the acclaimed PLATFORM EXPRESS* tool, a 36 ft long logging tool which provides higher resolution results, faster transmission rates, and improved logging speeds. The combination of technologies and techniques has changed the face of decision making in the global oil industry. All field developments are now managed by interdisciplinary teams of experts, and companies have moved towards developing groups of Asset Managers. These people develop expert knowledge about groups of fields, which is used to guide high-level decision making. The need to manage large fields more wisely has also encouraged service companies and major international oilproducing companies to develop alliances which are geared to efficient integrated projects in which both parties may share some risk and reward (Figure 1.23). The oil industry has always been forced to make decisions based on imperfect models of the reservoir and in economically uncertain markets. However, most modern oilfield decisions are science-based, with much of the guesswork that caused problems in the 1980s removed from the field development and management process. Today s field managers continually thirst for better data on their reservoirs and would like to manage their reserves in real time. Many operating companies are showing enthusiasm for 4D seismic surveys which provide a time-lapse record of fluid movement in the oil field. A new generation of seismic vessels (Figure 1.24) will be required to meet the challenges. Figure 1.24 The new Geco-Prakla seismic survey vessel will meet the challenges that face the oil industry in the 21st century and will be equipped to conduct large and detailed 4D (time-lapse) seismic surveys 19

18 Time line for the oil and gas industry Individual decision making Interdisciplinary teams Asset teams Science 10% Guesswork 40% Science 20% Problems in large reservoirs emerge (rethink of field management strategies) Guesswork 35% Gulf War Market forces 50% Iran/Iraq war Market forces 45% Interest in gas hydrates Shift to gas exploration and development Worldwide recession in industry (industry downsizes and enters a period of cost cutting) Breakup of USSR Drop in oil consumption and production Data handling, processing and interpretation CSU mainframe computers Tubing-conveyed perforating 3D seismic Drilling and completion technologies Single well studies Petrophysical multiwell database Image Examiner workstation Single discipline workstations on the Charisma platform Developments in data management, archiving and handling Charisma UNIX integrated workstations facilitate field and structural modelling Finder dynamic data management First application of GeoFrame software in the Middle East Downhole seismic array CSI tool Green burner AIT tool Technology Oil-base muds Downhole pressure tests Walkaway VSP surveys Measurements while drilling Horizontal wells GST tool 4-pad Formation MicroScanner tool IRIS tool Multilateral wells ASI tool FracView software RST tool MAXIS 500 service Coiled tubing CQG tool Formation MicroScanner imaging TLC system FMI tool MDT tool IT Information Technology power increases Communication systems SINet connection among Schlumberger research centres SINet X25 in Middle East brings SINet allows easy file transfer World Wide Web available throughout Schlumberger

19 Integrated project managment Recognition of extreme water production in giant fields Increased demand for oil and gas Incentive approach adopted by alliances Inter-company project alliances gather momentum Growth in tar sand development in Canada and Venezuela Science 60% Science 65% Guesswork 10% Guesswork 5% Market forces 30% Market forces 30% Horizontal wells Oil-base mud wells Ahwaz Field study, Iran Instantaneous data transmission from wellsite StratLog and CPS surface mapping and modelling Integrated studies of giant fields (Marjan and Safaniya, Saudi Arabia) ECLIPSE reservoir simulation products Complete data management solutions (LogDB, SeisDB, AssetDB systems) GeoFrame 3 integration of geoscience on a single platform GeoWeb World Wide Web data management Integrated Reservoir Optimization Virtual data rooms and real-time reservoir management ARI tool Pivot Gun equipment FloView tool Nonradioactive sources Seismic while drilling LWD retrievable sources Geosteering 3D VSP PLATFORM EXPRESS time-lapse borehole seismic Integrated data acquisition Logging while drilling (LWD) UBI tool Permanent gauges/sensors CMR imaging PL Flagship service 4D seismic Schlumberger has world's largest intranet Data transfer traffic increases by 800% annually Schlumberger uses WWW as main communication tool Connect Schlumberger server goes on-line LogNet satellite dishes at wellsite Extranets develop (interconnecting Intranets) Remote monitoring of all field operations

20 PLATFORM EXPRESS service Introduction of the PLATFORM EXPRESS integrated wireline logging tool marked a major shift in wireline logging. Every aspect of this new tool offers clear advantages over the traditional triple-combo arrangement. The PLATFORM EXPRESS tool (Figure 1.25) is shorter and can be run faster than its predecessor, and extensive field tests carried out around the world show it to be the most reliable wireline equipment ever developed. The most important aspect of any logging tool, however, is not its speed or its reliability, but the quality of the data it gathers. The PLATFORM EXPRESS tool sets new quality standards, and delivers these improved results in half the time. The reduced tool length is made possible by sensor integration and complete reengineering of the components. Better quality logs, more data and higher resolutions can reveal more of the subtle pay zones that may have been overlooked by traditional tools. Such major developments are only possible as a result of long-term funding for research and development programmes. 90 ft Triple-combo 38 ft PLATFORM EXPRESS tool Figure 1.25 At less than half the length of a triplecombo, the PLATFORM EXPRESS tool offers a compact design that reduces set-up time and logs twice as fast as traditional methods Communications Downhole sensors WellWatcher Data validation and trend analysis Figure 1.26 The WellWatcher system integrates downhole and surface measurements with supervisory control and data acquisition software for communication and acquisition The WellWatcher* system Schlumberger pioneered permanent monitoring with the first installation of permanent downhole sensors in Since then, the technique has developed from single-well downhole pressure measurement to the new WellWatcher wellsite production monitoring and communication equipment (Figure 1.26). The WellWatcher system integrates downhole and surface measurements with supervisory control and data acquisition (SCADA) software for communication and acquisition. All the wells in a field can be monitored from the operator s office to optimize production, to schedule well maintenance or to guide field development and reservoir management throughout the life of the field. WellWatcher projects are designed after intensive consultation with the client. A range of techniques is currently available to match most environmental and production requirements. The range includes equipment for eruptive and assisted production wells (ESP, gas lift, sucker-rod pumps), and for subsea or platform operations in high temperature and pressure or sour conditions. The WellWatcher systems use state-ofthe-art downhole sensors designed exclusively for long-term permanent installations. Each installation is backed by the experience gained in more than 1500 installations worldwide. Early production facilities The average size of oil and gas discoveries is decreasing. The age of the supergiants is past no supergiant fields (fields with more Surface sensors and controls than 5 billion barrels of oil or oil equivalent in place) have been discovered since the late 1970s. It is unlikely that many supergiants will be found in the future: exploration and development efforts will be concentrated on smaller fields. Small fields must be developed in ways that are very different to the traditional approach for giant and supergiant fields. In any field a balance must be struck between the development costs and the geoscientist s estimates of recoverable reserves. In the smallest fields the margin for error is very small and construction of a large, permanent platform may be too expensive for the volume of oil present. If this is the case, early production facilities (Figure 1.27) will allow the field to be developed at relatively low cost and low risk. Permanent platforms can be replaced by floating production facilities (such as a converted drilling rig) that can be put in position for the few years that it takes to deplete the field. Oil or gas can be exported to the refinery by pipeline if the new field is close to the existing pipeline infrastructure, or by shuttle tanker if the distances involved are too great (Figure 1.28). This flexible approach to field development uses smallscale production and separation facilities which can be put together off-the-shelf as required. This modular solution means that production facilities tailored exactly to the operator s requirements can be ready for delivery to the field very quickly, and are available on a lease or sale basis. The speed with which a field can pass from exploration and development to early production is of enormous benefit for the operator with returns on the initial investment being available almost immediately. 22

21 Shuttle tanker Production platform Offshore loading Subsea wellhead Figure 1.27 Early production facilities (EPF) can help to make marginal fields economic and, by bringing them into production early, help to repay exploration expenditure very quickly. Another benefit of the EPF approach is the relatively low environmental impact. Once the reservoir has been depleted, production facilities can be removed quickly and completely Seabed Reservoir Which way from here? In the next few years IRO* Integrated Reservoir Optimization is set to become the focus of attention. Real-time links will be set up to transmit field data from production and pilot wells to the computerized field model. This will allow the simulator to adjust and optimize parameters to ensure there is a consistency between both dynamic and static data and observed field response. In the not so distant future this will lead to virtual field management in which managers will be able to view holographic images of the field in real time. These could be used to deliver feedback to production wells to ensure cost-effective field management. Globalization of information systems will also come to the fore before the year Improvements in communication speeds through the WWW and intranets will allow companies to share data in real time across the world. This may lead to the centralization of experts, but at the same time it will give remote locations instant access to on-line advice and sharing of information. By the time we reach the next millennium, the goals of conserve and optimize for sustainable production should have been reached, by some! Figure 1.28 In many marginal fields tankers have become an integral part of production strategy. If the field is a long way from existing pipeline infrastructure and is too small to justify construction of a new pipeline, shuttle tankers provide a costeffective solution 23