SHALE GAS DRILLING
EVER GET THESE EMAILS…
Here’s
myAM
problems with
> Here's
Sent:
Thu,
anFebruary
astonishing
10, read.
2011
11:33:09
Important
Subject:
and
verifiable
Comments?
information:
these well intended messages:
>
A About
>
new drilling
6 months
technique
ago, 1.
the
is opening
writer
up vast from the News
Oftenwas
quoted
fields of previously
watching
a news program
out-of-reach
on
oil oil
and
in one
the of
Media
western
the
Forbes
United
Bros.States,
was the
helping
guest.reverse
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a
two-decade
said
to Forbes,
decline
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domestic
to ask
production
you
a
2. Often
quoted
out of context
of crude.
direct
question and I would like a direct
3. Supposed
“reserves” data given
answer; how much oil does
the U.S. have
Companies
in
the ground?"
are Forbes
investing
didbillions
not
miss
of dollars
astating
beat, what level of
without
to get
he
said,
at "more
oil deposits
than all
scattered
the Middle
across
Eastthose
put numbers are
reserves
North Dakota, Colorado, Texas and
together."
California. By 2015, oil 4.
>
executives
Claimsand
made without
analysts
>
The U. say,
S. Geological
the new fields
Service
could
issued
yield aas
knowledge
of what the real
much as
report
in April
2 million
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that only
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scientists
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energy
picture is
more
oil
men
than
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thewas
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Gulf ofbut
Mexico
man was it
produces now….
big…
5. It takes hours to unravel one of
those emails, to cross check
data, look up reserves, compare
like terms, etc.
Energy
Overview
Reserves
Analysis
Well Design
& Drilling
Fracking
Problems
3
Energy Overview
Estimated US Energy Use – 2009
Nuclear
9%c
Hydro
3%
Natural
Gas
25%
Coal
21%
Oil
37%
Other
5%
Energy
Sources
Energy
Wasted
58%
Residential
12%
Commercial
9%
Energy
Uses
Industrial
23%
Transport
29%
Estimated US Energy Use – 2009
Energy
Wasted
58%
85% of Waste
from 2 Sources
Electricity
Generation
47.6%
Transportation
(autos)
37.0
Estimated US Energy Use – 2009
Natural Gas Overview
42%
53%
Forecasted in April 2009
LARGEST GAS RESERVES
№ Field name
Country
1
South Pars/North Dome Iran and Qatar
2
Urengoy
Russia
3
Yamburg
Russia
4
Hassi R’Mel
Algeria
5
Shtokman
Russia
6
South Iolotan–Osman
Turkmenistan
7
Zapolyarnoye
Russia
8 Shale
Hugoton
USA
Since
Gas Extraction
is(TX-OK-KS)
9
Groningen
Netherlands
so 10
new,Bovanenko
this chart may not
Russia
11
Medvezhye
Russia
include
ANY of the world’s
12
North Pars
Iran
shale gas
13
Dauletabad-Donmez
Turkmenistan
14
Karachaganak
Kazakhstan
15
Kish
Iran
16
Orenburg
Russia
17
Kharsavey
Russia
18
Shah Deniz
Azerbaijan
19
Golshan
Iran
20
Tabnak
Iran
21
Kangan
Iran
TCF*
1235
222
138
123
110
98
95
Current
US Shale
81
Gas
73 Estimated
70
Reserves
are 750 TCF
68
48
47
BUT
46
comparing
to this
45
45
chart
might be
42
comparing
42
30
APPLES
and
22
ORANGES
20
* Recoverable
US SHALE GAS RESERVES
Source: US Energy Information Adminstration
BUT!
USGS came
back and
revised the
EIA’s data for
This is a whoppingthe Marcellus
down by 79.5%
to
55%
of the total
84 TCF
Total
Might Acutally be
153.6 TCF??
Shale Gas Overview
Forecasted in April 2009
When the distance
between the top of the
target shale and the
bottom of the aquifer is
small, ONLY experienced
operators should be
drilling!
Fracking Overview
Production Decline Curve
• Production rates are a
function of reservoir
pressure.
Economic
Uneconomic
• As production is
removed from the
reservoir, pressure
decreases and therefore
production decreases.
• At some point, the
economic limit is
reached and decisions
about the reservoir/ well
must be made.
25
Production Enhancement
Hydraulic Fracturing
• Fracture reservoir rock (up to
500’ from perforations) with
high pressure fluid & place a
permeable proppant material
into the fracture channel
• Fracture remain open after
pressure is reduced providing a
high conductivity pathway for
reservoir fluids to flow to the
well
26
Production Enhancement
Hydraulic Fracturing
• In North America, 58 percent
of new gas wells and 38
percent of new oil wells are
hydraulically fractured.
• Hydraulic fracturing is also
being used more often in
high permeability formations
58 % New
Gas Wells
38 % New
Oil Wells
27
Production Enhancement
Hydraulic Fracturing
A Frac Job takes considerable equipment
28
Environmental
Overview
Claims Against Fracking
Cows killed
• Drinking water burns
• Skin rashes
• Contaminated soils
• Air pollution
• Dust
•
Overview of One Experts Opinion
Conversation with Dr. Ian Duncan
Associate Director, Texas Dept of Economic Geology
• Areas of Dimock, PA have historical records of NATURAL
methane seepage into underground aquifers
• He notes that the local Ag Extension service used and still do
provide a warning brochure, which he has a copy of, advising
prospective new residents of the area of the dangers of methane
in their drinking water as home have blown up in the past as a
result. This was a problem in the 1950’s and 60’s.
• Evidence shows that more often than not, it is the natural
seepage of methane that is causing problems with their
drinking water, not Fracking as reported by the News Media
and YouTube
Separating FACT from FICTION
Conversation with Dr. Ian Duncan
Associate Director, Texas Dept of Economic Geology
• Over 1000 supposed claims of environmental disasters associated
with Fracking
• Only 30-40 have been filed with the Environmental Defense League
• 6 identified as possible issues
• 3 found incorrectly attributed fracking with naturally occuring methane
seepage into underground aquifers
• 3 found with bad cement jobs (Wyoming, Colorado, Ohio)
• 2 of those had prior knowledge of the cement situation but Fracked anyway
– Therefore only 1 instance of fracking causing unintentional problems
Dr. Duncan notes that a paper will be published this year with his results
Separating FACT from FICTION
MASSACHUTTES INSTITUTE OF
TECHNOLOGY – July 2011
(http://web.mit.edu/mitei/research/studies/documents/natural-gas-2011/NaturalGas_Chapter%201_Context.pdf)
“There has been concern that these fractures can also
penetrate shallow freshwater zones and contaminate
them with fracturing fluid, but there is no evidence that
this is occurring. There is, however, evidence of
natural gas migration into freshwater zones
in some areas, most likely as a result of substandard
well completion practices by a few
operators.”
Separating FACT from FICTION
Environmental Protection Agency
Study started in 2010
Results due in 2012
EPA STUDY IN PROGRESS
EPA STUDY IN PROGRESS
Well Design Overview
Well Design and
Drilling
46
Well Design during drilling
Blowout Preventer – Monitor
& Controls the pressure within
each casing string of the well
Blowout
Preventer
Surface
Casing String – Successive
sections of pipe of decreasing
diameter set one inside the
other and cemented in place
Casing
Strings
``
47
How is Casing Installed?
• Drill 36” hole to design
depth
• Slide 30” casing to depth
within 36” hole
• Cement 30” casing to 36”
hole
• Drill 24” hole thru cement in
30” casing to design depth
• Slide 20” casing to depth
within the 24” hole
• And so on ….
Surface
30”
Casing
36”hole
24”hole
20”
Casing
48
Typical Well Casing Program
• 30” Casing = Conductor Pipe
(hung at surface; it is drilled or
driven)
Casing
Size
Depth
• 20” Casing = Surface Casing
(hung at surface; may not be
necessary, depends on geology)
30 in
(36”hole)
500 ft
• 13 3/8” Casing = Intermediate
Casing (hung at the surface)
20 in
(26”hole)
3,000
ft
• 9 5/8” Casing = Intermediate
casing (depending on design,
could be hung off of 13 3/8”)
13 3/8 in
(17 ½” hole)
• 7” Liner = Not a casing per se
because it is hung off the end of
the 9 5/8” casing; it doesn’t run
to the surface
7,000
ft
9 5/8 in
(12 ½” hole)
10,000 ft
7 in Liner
(8½” hole)
15,000 ft
49
Well Casing Program
Why is casing
needed?
• Protect freshwater aquifers that
might be present in the subsoil
• Prevents contamination
between rock strata layers
• Contain any unusual pressure
in the layers of rock strata that
might be encountered
• Prevent borehole collapse while
drilling deeper
Freshwater Aquifer
Low Pressure
Zone or future
producing zone
Wellbore
thru the
rock strata
High Pressure
Zone
Black Gold!
• Provide control of drilling mud
being pumped down-hole
50
Well Design during completion
Xmas Tree– Monitor &
Controls the pressure within
the each casing of the well
while allowing the well to flow
to the surface
Xmas
Tree
Surface
Perforations – Holes shot
thru the casing to allow fluid
to flow into the wellbore
Down-hole Completion
Equipment – Devices & tools
installed in the well to control
which reservoir is produced
and to give real-time data
``
Perforations
Down-hole
Completion
Equipment`
51
Well Design during completion
To
Production
Facilities
Xmas
Tree
Production Tubing – A string
of pipe that runs from the
producing zone to the
wellhead in which oil and/or
gas flows to the surface
facilities
Surface
``
Perforations
Down-hole
Completion
Equipment`
52
Types of Well Design
• “Straight-hole”
• Directional or
“Deviated Well”
• “Horizontal
Well”
Black Gold!
53
Deviated Well
Why drill a deviated
well?
• Known fault can cause an
unplanned deviation from
the projected drill path
• High pressure zones might
exist to one side of a fault
• Subsurface “debris” like
ancient reefs could cause
a slower drill rate (ROP)
than desired (time is
money!)
High
Pressure
zones
behind
fault
Fault
Black Gold!
54
Deviated, Horizontal Wells
Why drill a horizontal
well?
• Low permeability reservoirs
are best produced by
horizontal wells, the ultimate
in “deviated well”
• Three kinds of horizontal
wells, long/short/medium
radius:
Target Reservoir
• Long = 10 per 100ft
• Medium = 20 per 100ft
• Short = 40 per 100ft
55
Horizontal Well Procedure
• At start of deviation, replace
drillbit with a “bent sub”,
gyroscope, steerable mud motor
& bit
• Add logging-while-drilling (LWD)
unit & power pack within 20 ft of
bit
• Slowly rotate drillstring to prevent
“sticking” & start “pushing”
steerable system forward while
flowing mud to mud motor
• Drill while being pushed forward
& steer system as need be to
maintain horizontal direction
56
Multilateral, Horizontal Wells
• Added advantage of
horizontal well design is
to include “Multilaterals”
(additional boreholes
from the same drillsite)
• From one wellsite,
several sections of the
reservoir can be
accessed & produced
Drillsit
e
Significant
Production
Increase
Plan view
57
Horizontal Drilling Advantages
• Increase in reserves in place by 2% of the
original oil in place (OIIP)**
• Cost ratio of horizontal versus vertical wells
is approximately 2 to 1**
• Production ratio for horizontal wells versus
vertical wells is approximately 3.2 to 1**
• Inclusion of multilaterals increases
production ratio even more!!
** per U.S. Department of Energy
58
Final Well Program
• Well Schematic – Showing
hole (bit) size, casing plan,
mud plan, planned TD
• Drilling Time Estimate –
Breakdown total time into key
components to various depths
• Well Cost Estimate – Listing
of all expected costs for the
well
• Well Time VS. Depth Plot – a
“picture” of how much drilling
time is planned for each casing
run
59
Drilling Overview
Drilling
61
Drilling
Well Location?
Onshore
Offshore
62
Drilling
Well Type?
Exploratory
(“Wildcat Well”)
On-structure
(“In-field”, Appraisal)
Normal Success
Rate = +/- 1 in 10
to
+/- 3 in 10
Normal Success
Rate = +/- 5 in 10
to
+/- 9 in 10 63
Drilling
Main Components of Drilling
Derrick
Traveling
Block/Swivel
Turntable/Kelly/
Kelly Bushing
Blowout Preventer
Casing (different
sizes)
Drill String
Drill Bit
Drill Mud
64
Drilling
Mud
IN
What is Drilling Mud
A mixture of clay with either water, oil, oil and
water, or synthetic organic matter and water.
To this, various viscosity and density
enhancers and additives to achieve specific
objectives (adjust pH, control bacteria, defoam, filtrate reducers, etc.) are added.
How does it get in the
well?
Mud is pumped into the drill pipe, flows down
the pipe, exits out the drill bit, and flows,
along with rock cuttings, up the borehole
back to the rig.
Mud out
Drilling Mud
Well
bore
Drill Bit
65
Drilling
What is the Drilling Mud System?
A ‘CLOSED SYSTEM’
where the drilling mud
is mixed & pumped:
3. Mud
Hose
• from the mud pit/tanks,
2. Mud
Pump
• up into the mud hose
• down into the drillstring,
1. Mud Pit
or Tanks • thru the drillbit,
4. Circulate Mud
down drillstring and
back up borehole exit
below Blowout
Preventer
• up the wellbore,
• over the shellshakers and
5. Shale
shakers
• back to the mud pit/tanks
66
Drilling
What does Drilling Mud do?
• Cools drill-bit
• Stabilizes borehole walls
• Transports rock cuttings (“cuttings”) to
surface (mud engineer examines cuttings
w/microscope to check for oil and porosity)
• Offsets hydrostatic/reservoir pressure
67
Drilling Plan
How Critical is
Drilling Mud?
0
500
• Blue line is Pore Pressure (the
pressure from the overburden)
• Yellow line is Mud Weight
pressure
20"
1,500
TVDBDF (m)
• Red line is the Pressure that will
fracture the Reservoir
1,000
2,000
2,500
13.5/8"
3,000
3,500
4,000
Overpressu
re
zones
10.3/4" x 9.7/8"
4,500
• If Mud weight is too hi, it will
damage the reservoir; if too low,
a well blowout is possible!
5,000
5,500
0.5 0.6 0.7 0.8 0.9 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 2.0 2.1 2.2 2.3
SG
Specific Gravity
68
Drilling Plan
Drilling Plan Components
• Location & coordinates of well
• Anticipated time for each major activity
• Drill-bit Plan (what size to what depth)
• Casing Plan (what size to what depth)
• Planned mud weight to offset hydrostatic/
reservoir pressure
• Testing/logging plan
• Signoff plan for Non-Operator reps
69
Drilling
Drilling Contract Types
• Costs per Day (DAY RATE)
• Costs per Foot (FOOTAGE RATE)
• Set Costs (TURNKEY BASIS)
• Success often depends on quality
& experience of Operator
70
Drilling
Drilling Operations
• Survey well location
• Build roads, clear and level ground
• Drill water well (optional)
• Layout casing pipe/drill string &
equipment
• Prepare drilling mud
• Assemble Rig
• Drill each segment; set casing &
cement
71
Drilling
Drilling Operations (cont’d)
• Unplanned drill breaks: stuck pipe,lost
circulation, required fishing trip, etc.
• Planned drill breaks: layout and position
casing on deck, circulate bottom to remove
cuttings, coring, drill stem testing, etc.
• Let’s look at POSSIBLE DRILLING
PROBLEMS, CORING and WELL LOGGING
72
Drilling
Possible Drilling Problems
• Lost tool (something breaks off or is dropped in well)
• Stuck Pipe (drill pipe adheres to well walls due to
suction/differential pressure or dogleg in wellbore)
• Sloughing shale (swelling of shales, drops to bottom, can’t
circulate out)
• Lost circulation (high porosity zone/cavernous zone)
• Corrosive gases encountered (hydrogen sulfide)
• Abnormal high pressure (drill into/through a high press
zone)
• Blowout (mud weight not sufficient to hold back abnormal
high pressure gas; gas flows to surface and ignites unexpectedly)
73
Reserves Overview
Classification of Reserves is key!
What are Reserves?
The amount of oil & gas in a reservoir currently available for production
There are several different reserves names used:
• Reserves in Place (physically contained in the reservoir; remember
that only 25 to 30% of that can actually be recovered with conventional
technologies; OOIP)
• Recoverable Reserves (estimate of what can be produced from the
reservoir)
• Proven Reserves, Developed or Undeveloped (reserves
that can be calculated with reasonable certainty because the field has
been defined by appraisal well(s) that have been tested)
• Proved Behind-Pipe Reserves (undeveloped, proven reserves
calculated behind the casing)
• Proved (P90), Probable (P50) and Possible (P10)
Reserves
75
Classification of Reserves is key!
• Proved (P90) Reserves – 90 % chance or greater that the
reserves are there; must have “very high certainty” that reserves
can be “economically” recovered with current technology. SEC
allows only reporting of P90
• Probable (P50) Reserves- 50 % chance that the reserves are
there
• Possible (P10) Reserves - 10 % chance that the reserves are
there
• Remember estimates are based on data from a location
as much as 2 miles below the surface, and on
characteristics of a hole 6” in diameter extrapolated over
several hundred acres of reservoir…
Reserves estimating is more of an
art than a science!
76
http://water.epa.gov/type/groundwater/uic/class2/hydraulicfracturing/index.cfm
http://www.dec.ny.gov/docs/materials_minerals_pdf/ogdsgeischap5.pdf
http://www.netl.doe.gov/technologies/oilgas/publications/epreports/shale_gas_primer_2009.pdf
http://www.cbsnews.com/video/watch/?id=7054210n&tag=related;photovideo
http://video.pbs.org/video/1801494624
http://blogs.telegraph.co.uk/finance/rowenamason/100006602/shale-gas-pollution-fears-leaveamericans-with-another-energy-headache/#