Integrated Reservoir Asset Management

Integrated Reservoir Asset Management

Integrated Reservoir Asset Management Principles and Best Practices John R. Fanchi AMSTERDAM. BOSTON. HEIDELBERG. LONDON NEW YORK. OXFORD. PARIS. SAN DIEGO SAN FRANCISCO. SINGAPORE. SYDNEY. TOKYO Gulf Professional Publishing is an imprint of Elsevier

Gulf Professional Publishing is an imprint of Elsevier 30 Corporate Drive, Suite 400 Burlington, MA 01803, USA The Boulevard, Langford Lane Kidlington, Oxford, OX5 1GB, UK # 2010 Elsevier Inc. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or any information storage and retrieval system, without permission in writing from the publisher. Details on how to seek permission, further information about the Publisher s permissions policies and our arrangements with organizations such as the Copyright Clearance Center and the Copyright Licensing Agency, can be found at our website: www.elsevier.com/permissions. This book and the individual contributions contained in it are protected under copyright by the Publisher (other than as may be noted herein). Notices Knowledge and best practice in this field are constantly changing. As new research and experience broaden our understanding, changes in research methods, professional practices, or medical treatment may become necessary. Practitioners and researchers must always rely on their own experience and knowledge in evaluating and using any information, methods, compounds, or experiments described herein. In using such information or methods they should be mindful of their own safety and the safety of others, including parties for whom they have a professional responsibility. To the fullest extent of the law, neither the Publisher nor the authors, contributors, or editors, assume any liability for any injury and/or damage to persons or property as a matter of products liability, negligence or otherwise, or from any use or operation of any methods, products, instructions, or ideas contained in the material herein. Library of Congress Cataloging-in-Publication Data Fanchi, John R. Integrated reservoir asset management : principles and best practices / John Fanchi. p. cm. Includes bibliographical references and index. ISBN 978-0-12-382088-4 1. Oil reservoir engineering. 2. Petroleum reserves. I. Title. TN870.57.F36 2010 622.3382 dc22 2010006757 British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library. For information on all Gulf Professional Publishing publications visit our Web site at www.elsevierdirect.com 10 11 12 13 14 10 9 8 7 6 5 4 3 2 1 Printed in the United States

Contents Preface About the Author ix xi 1 Introduction 1 1.1 Life Cycle of a Reservoir 1 1.2 Reservoir Management 5 1.3 Recovery Efficiency 7 1.4 Reservoir Management and Economics 8 1.5 Reservoir Management and the Environment 11 CS.1 Valley Fill Case Study: Introduction 14 Exercises 15 2 Fluid Properties 17 2.1 The Origin of Fossil Fuels 17 2.2 Description of Fluid Properties 18 2.3 Classification of Petroleum Fluids 23 2.4 Representation of Fluid Properties 27 CS.2 Valley Fill Case Study: Fluid Properties 31 Exercises 32 3 Geology 33 3.1 The Geologic History of the Earth 33 3.2 Rock Formations and Facies 36 3.3 Structures and Traps 39 3.4 Petroleum Occurrence 39 3.5 Geochemistry 40 3.6 Basin Modeling 42 3.7 Porous Media 43 3.8 Volumetric Analysis 46 CS.3 Valley Fill Case Study: Geologic Model 47 Exercises 47 4 Porosity and Permeability 49 4.1 Bulk Volume and Net Volume 49 4.2 Porosity and Grain Volume 50 4.3 Effective Pore Volume 50 4.4 Porosity Compressibility 51 4.5 Darcy s Law and Permeability 51 4.6 Permeability Averaging 58

vi Contents 4.7 Transmissibility 61 4.8 Measures of Permeability Heterogeneity 63 4.9 Darcy s Law with Directional Permeability 65 CS.4 Valley Fill Case Study: Permeability 68 Exercises 69 5 Geophysics 71 5.1 Reservoir Scales 71 5.2 Physics of Waves 74 5.3 Propagation of Seismic Waves 76 5.4 Acoustic Impedance and Reflection Coefficients 78 5.5 Seismic Data Acquisition, Processing, and Interpretation 80 5.6 Seismic Resolution 82 5.7 Stratigraphy 85 CS.5 Valley Fill Case Study: V P /V S Model 87 Exercises 88 6 Petrophysics 89 6.1 Elastic Constants 89 6.2 Elasticity Theory 93 6.3 The Petroelastic Model 96 6.4 The Geomechanical Model 101 6.5 Time-Lapse (4-D) Seismology 104 CS.6 Valley Fill Case Study: Bulk Moduli 107 Exercises 108 7 Well Logging 109 7.1 Drilling and Well Logging 109 7.2 Direct Measurement Logs 113 7.3 Lithology Logs 114 7.4 Porosity Logs 115 7.5 Resistivity Logs 118 7.6 Other Types of Logs 120 7.7 Reservoir Characterization Issues 121 CS.7 Valley Fill Case Study: Well logs 123 Exercises 124 8 Well Testing 125 8.1 Pressure Transient Testing 125 8.2 Oil Well Pressure Transient Testing 126 8.3 Gas Well Pressure Transient Testing 136 8.4 Well Test Capabilities 141 CS.8 Valley Fill Case Study: Well Pressures 143 Exercises 144 9 Production Evaluation Techniques 145 9.1 Decline Curve Analysis 145

Contents vii 9.2 Gas Well Deliverability 147 9.3 Material Balance 149 9.4 Production Performance Ratios and Drive Mechanisms 153 9.5 Production Stages 155 9.6 Tracer Tests 157 9.7 Tracer Test Design 160 CS.9 Valley Fill Case Study: Production 164 Exercises 165 10 Rock Fluid Interactions 167 10.1 Interfacial Tension 167 10.2 Wettability 168 10.3 Capillary Pressure 169 10.4 Correlation of Capillary Pressure to Rock Properties 173 10.5 Equivalent Height and Transition Zone 174 10.6 Effective Permeability and Relative Permeability 176 10.7 Mobility, Relative Mobility, and Flow Capacity 181 CS.10 Valley Fill Case Study: Rock Fluid Interaction Data 183 Exercises 184 11 Reservoir Characterization 187 11.1 Flow Units 187 11.2 Traditional Mapping 190 11.3 Computer-Generated Mapping 192 11.4 Geostatistics and Kriging 194 11.5 Geostatistical Modeling 198 11.6 Visualization Technology 202 CS.11 Valley Fill Case Study: Reservoir Structure 203 Exercises 204 12 Fluid Displacement 205 12.1 Fractional Flow 205 12.2 The Buckley-Leverett Theory 209 12.3 Welge s Method 211 12.4 Frontal Advance 213 12.5 Linear Stability Analysis 216 12.6 Well Patterns 218 CS.12 Valley Fill Case Study: Conceptual Model 221 Exercises 221 13 Reservoir Simulation 223 13.1 Continuity Equation 223 13.2 The Convection Dispersion Equation 226 13.3 The Navier-Stokes Equation 228 13.4 Black Oil Model Equations 229

viii Contents 13.5 Integrated Flow Model Equations 232 13.6 The Well Model 236 CS.13 Valley Fill Case Study: Layering of Reservoir Flow Model 240 Exercises 241 14 Data Management 243 14.1 Sources of Rock Data 243 14.2 Sources of Fluid Data 244 14.3 Sources of Field Performance Data 249 14.4 Data Management 250 14.5 Data Preparation 253 CS.14 Valley Fill Case Study: Input Data Uncertainty 255 Exercises 256 15 Reservoir Flow Modeling 257 15.1 Green Field Modeling 257 15.2 Brown Field Modeling 263 15.3 Deterministic Reservoir Forecasting 264 15.4 Probabilistic Reservoir Forecasting 267 15.5 Guidelines for Modern Flow Modeling 275 CS.15 Valley Fill Case Study: Deterministic History Match and Base Case Prediction 276 Exercises 277 16 Modern Reservoir Management Applications 279 16.1 Improved Oil Recovery 279 16.2 Unconventional Fossil Fuels 282 16.3 Geothermal Reservoir Management 285 16.4 Sequestration 288 16.5 Compressed Air Energy Storage 289 CS.16 Valley Fill Case Study: Waterflood Prediction 291 Exercises 292 Appendix A Unit Conversion Factors 295 Appendix B IFLO User s Manual 299 B.1 Introduction to IFLO 301 B.2 Initialization Data 303 B.3 Recurrent Data 332 B.4 Program Output 341 References 343 Index 355

Preface The primary objective of this book, Integrated Reservoir Asset Management: Principles and Best Practices, is to introduce the topic of reservoir management to those with diverse technical backgrounds. Modern reservoir management relies on asset management teams composed of people from a variety of scientific and engineering disciplines. In addition to geologists, geophysicists, and reservoir engineers, asset management teams can include chemists, physicists, biologists, production engineers, flow assurance engineers, drilling engineers, facilities engineers, mechanical engineers, electrical engineers, and environmental engineers. This book is designed to present concepts and terminology for topics that are often encountered by members of reservoir asset management teams and professionals. This book can be used as an introduction to reservoir management for science and engineering students, practicing scientists and engineers, continuing education classes, industry short courses, or self-study. Included in the book is an update of the material in Shared Earth Modeling (2002), which was a compilation of material that I taught in reservoir characterization courses for geoscientists and petroleum engineers at the Colorado School of Mines. The change in title from Shared Earth Modeling to Integrated Reservoir Asset Management recognizes the technical diversity now found in modern asset management teams, and it changes the focus from the shared earth model to reservoir management. Exercises have been added that allow the reader apply a flow simulator (IFLO) as part of a case study that is used to illustrate and integrate the material in the book. The flow simulator was originally provided with the book Principles of Applied Reservoir Simulation, Third Edition (Elsevier, 2006). Chapter 1 presents an overview of reservoir management. Chapter 2 discusses fluids that may be contained in reservoirs. Chapter 3 reviews geological principles used to characterize the subsurface environment, and Chapter 4 introduces two key reservoir parameters (porosity and permeability). Chapters 5 through 9 describe methods used to acquire information about the subsurface environment. Chapter 10 reviews rock fluid interaction relationships that are needed for a realistic formulation of multi-phase fluid flow equations. Chapter 11 discusses how to distribute properties throughout the reservoir, and Chapter 12 presents fluid displacement concepts. An introduction to fluid flow equations used in reservoir simulation is presented in Chapter 13. Data management is discussed in Chapter 14. Chapter 15 introduces modern reservoir flow modeling workflows, and Chapter 16 describes a variety of reservoir management applications, including some that are relevant to sustainable energy systems. A Valley Fill Case Study is used to show the reader

x Preface how the information in each chapter can be applied as part of an integrated reservoir management study. Exercises are provided at the end of each chapter. Two types of units are commonly found in petroleum literature: oil field units and metric (SI) units. The units used in this book are typically oil field units. In Appendix A, the process of converting from one set of units to another is simplified by providing frequently used factors for conversion between oil field units and metric units. A flow simulator (IFLO) is used in several exercises; see www.elsevierdirect.com/9780123820884. The user s manual for the flow simulator is provided in Appendix B. My colleagues in industry and academia, as well as the students in my multidisciplinary classes, helped me identify important and relevant topics that cross disciplinary lines. I am, of course, responsible for the final selection of topics. I would especially like to thank Kathy Fanchi and Chris Fanchi for their efforts in the preparation of this manuscript. John R. Fanchi, Ph.D.

About the Author John R. Fanchi is a professor in the Department of Engineering and Energy Institute at Texas Christian University in Fort Worth, Texas. He holds the Ross B. Matthews Chair of Petroleum Engineering and teaches courses in energy and engineering. Before this appointment, he taught petroleum and energy engineering courses at the Colorado School of Mines and has worked in the technology centers of four energy companies. He co-edited the General Engineering volume of the Petroleum Engineering Handbook published by the Society of Petroleum Engineers, and he is the author of several books, including Principles of Applied Reservoir Simulation, Third Edition (Elsevier, 2006), Math Refresher for Scientists and Engineers, Third Edition (Wiley, 2006), Energy in the 21 st Century, Second Edition (World Scientific, 2010), Energy: Technology and Directions for the Future (Elsevier Academic Press, 2004), Shared Earth Modeling (Elsevier, 2002), Integrated Flow Modeling (Elsevier, 2000), and Parametrized Relativistic Quantum Theory (Kluwer, 1993).