Enhanced Oil Recovery Institute
Department of Geology and Geophysics
University of Wyoming
Preliminary CO
2
Demand Analysis for the Powder River Basin
Presentation to Wyoming Pipeline Authority
Jan. 24, 2006 by
J. Michael Boyles
Klaas van ’t Veld

Assist operators to help improve oil production in
Wyoming fields through research, technology transfer and project assistance
–
Improve existing production practices
•
Increase efficiency of water floods
• Identify bypassed pay
–
Assist with evaluation of potential EOR projects for Wyoming fields

Goal – More CO
2
EOR in Wyoming
 Convert more of Wyoming’s CO
2 to a resource from a waste gas
 Help Wyoming operators with CO
2
– Very effective EOR technique field evaluations
• Recovers additional 8% to > 15% of OOIP
• Swells oil
• Lowers viscosity
–
Capital intensive
–
Higher operating costs

What is EORI Doing about CO
2
 Characterizing Wyoming oil fields
–
Building integrated database for fields and reservoirs
(WGA, O&G, SPE, DOE ….)
–
Analyzing reservoir performance (RMS-AAPG talk)


Building reservoir models
–
Analyzing reservoirs currently being flooded
–
Will predict CO
2
-EOR response for reservoirs not currently being flooded with CO
2
Developing scoping tools
– Simple tools to evaluate “what if” scenarios
–
Based upon Wyoming reservoir characteristics

Current CO
2
Situation in Wyoming


CO
2
Sources
– La Barge
•
Sales
• Venting
– Madden
•
Venting
250 MMSCFD at high pressure
210 MMSCFD at low pressure
55 MMSCFD at low pressure
Existing pipeline*
– Current distribution
• Salt Creek
• Baroil
•
Rangely
105 MMSCFD
40 MMSCFD
80 MMSCFD
• Monell 30 MMSCFD
– Potential additional distribution to PRB
•
Easy
• Possible
+75 MMSCFD
+350 MMSCFD
* Towler, in press

Current CO
2
Pipeline
Madden
La Barge
24 in
20 in
Monell
Bairoil
Rangely
16 in
Powder
River
Basin
Salt Creek

Enhanced Oil Recovery Institute
Department of Geology and Geophysics
University of Wyoming
Preliminary CO
2
Demand Analysis for the Powder River Basin

Study Area
Powder River Basin

Powder River Basin
50 miles

Initial Scope
 Reservoirs
Minnelusa
Sussex / Shannon
Muddy
Cum production
600 MMBO*
365 MMBO*
266 MMBO*
* IHS Production Database

Rationale
– Near the end of CO
2
•
Extra capacity trunk line
–
Several big fields in basin that would support development of needed infrastructure
•
Hartzog Draw, Hilight, Raven Creek,
House Creek, Big Muddy
– Younger fields that have complete production data
–
Structurally simple traps
–
Stratigraphic heterogeneities are understandable

Work Plan
1.
Identify “promising” fields
2.
Screen for miscibility
3.
Estimate CO
2
-EOR response
4.
Screen for profitability

1. Identify “Promising” Fields


99 Fields (120 field-reservoir combinations)
– Each has cum oil > 4 MMBO
– Combined cum oil 1,300 MMBO
–
Combined OOIP 3,200 MMBO
Potential size of prize, assuming
– all pass miscibility screen
– all yield extra 10% of OOIP CO
2
-EOR response
– all pass profitability screen
320 MMBO

2. Screen for Miscibility
 Rule-of-thumb approach
– API cutoff
–
Depth cutoff
– Too simple for accurate forecasts
 EORI approach
–
Measured MMP
–
Estimate based on oil composition and temperature
–
Estimate based on API and temperature

3. Estimate CO
2
-EOR Response
 Rule-of-thumb approach
–
8 to 15 % of OOIP
 Other industry-standard approaches
– Scaled response (Kinder Morgan tool)
•
Based on field analogs (San Andres and Morrow)
– CO
2
Prophet (DOE)
•
Based on simulation of Louisiana fluvial-deltaic reservoir
 EORI approach
– Scaled response (“EORI Tool”)
•
Based on simulation of Wyoming reservoirs

4. Screen for Profitability
 Industry-standard approaches
– Use KM tool with built-in price, cost assumptions
–
Use CO
2
Prophet adding price, cost assumptions
 EORI approach
– Use “EORI tool” with flexible price, cost assumptions

Why an EORI Tool?
 Major Economic Screening Factors
– Cost of pipeline
•
Distance to trunk line
– Cost of gas plant
•
Capital cost
•
Operating costs
• Quantity recycled over time
– Cost of CO
2
•
Price
• Quantity purchased over time
– Oil revenues
•
Price
• Quantity produced over time

14
12
10
8
6
4
2
0
0
KM Prediction: Lost Soldier-Tensleep
Oil Production
2 4
Predicted
8 10
Actual
6
Year
12

300
250
200
150
100
50
0
0
KM Prediction: Lost Soldier-Tensleep
CO2 Purchases
2 4
Predicted
8
Actual
10 6
Year
12

50
0
-50
-100
0
200
KM Prediction: Lost Soldier-Tensleep
Cumulative Net Cash Flow (Relative to Baseline)
150
Based on 1995
KM cost data
Predicted
100
2 4 8
Actual
10 6
Year
12

KM Prediction: Lost Soldier-Tensleep
PV Profit After Tax
160
140
120
100
80
60
40
20
0
-20
-40
0.0
Predicted
Based on 1995
KM cost data
Actual
0.1
0.2
0.3
Nominal Discount Rate
0.4
0.5

KM Prediction: Lost Soldier-Darwin Madison
Oil Production
Predicted
5.0
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
0 2 4 6
Actual
10 12
Year
8 14

KM Prediction: Lost Soldier-Darwin Madison
CO2 Purchases
100
90
80
70
60
50
40
30
20
10
0
0 2 4
Predicted
6 10
Actual
12
Year
8 14

KM Prediction: Lost Soldier-Darwin Madison
Cumulative Net Cash Flow (Relative to Baseline)
60
50
40
30
20
10
0
-10
-20
-30
0
Based on 1995
KM cost data
2 4 6
Predicted
Actual
Year
8 10 12 14

KM Prediction: Lost Soldier-Darwin Madison
40
30
20
10
60
50
0
-10
-20
0.0
PV Profit After Tax
Based on 1995
KM cost data
Predicted
Actual
0.5
0.1
0.2
0.3
Nominal Discount Rate
0.4

18
16
14
12
10
8
6
4
2
0
0
KM Prediction: Wertz-Tensleep
Oil Production
2 4
Predicted
6
Actual
8
Year
10 12 14 16 18

150
100
50
0
0
250
KM Prediction: Wertz-Tensleep
CO2 Purchases
Predicted
200
2 4 6
Actual
8
Year
10 12 14 16 18

KM Prediction: Wertz-Tensleep
Cumulative Net Cash Flow (Relative to Baseline)
140
120
100
80
60
40
20
0
-20
-40
-60
-80
0
Based on 1995
KM cost data
2 4 6
Predicted
Actual
8 10 12
Year
14 16 18

KM Prediction: Wertz-Tensleep
PV Profit After Tax
120
100
80
60
40
20
Predicted
Based on 1995
KM cost data
0
-20
-40
0.0
Actual
0.1
0.2
0.3
Nominal Discount Rate
0.4
0.5

What about Economies of Scale?
 Major Economic Screening Factors
– Cost of pipeline
•
Distance to trunk line
– Cost of CO
2 gas plant
•
Capital cost
•
Operating costs
• Quantity recycled over time
– Cost of CO
2
•
Price
• Quantity purchased over time
– Oil revenues
•
Price
• Quantity produced over time

Two Phases
 Initial estimate of CO define CO
2
2
-EOR response to trunk pipeline route
– Individual field model
– Central gas recycling plant model
 Detailed analysis of CO
2
-EOR response and economics given CO
2 trunk pipeline route
–
Individual field model
–
Central gas recycling plant model

CO
2
-EOR Potential Recovery
3 Mile radius

CO
2
-EOR Potential Recovery
6 Mile radius

CO
2
-EOR Potential Recovery
9 Mile radius

Bottom Line
 Wyoming is blessed with cheap CO
2
 The distribution system is not at capacity
 CO
2
-EOR could substantially increase production in the PRB
So where do we go from here?

Current and Future Work
 Wyoming reservoirs are unique
 Need accurate, WY-specific forecasting models
–
Statistical analysis of past production
–
Research into CO
2
-EOR response
–
Research into CO
2
-EOR economics (including potential sequestration credits)
 Working with Pipeline Authority
 Building database and knowledge repository on Wyoming oil fields

We Need Your Help
 Contact us with suggestions / recommendations
 Please let us know if you have data that might help
– Oil/gas analyses
–
Oil samples
– Special core analyses
–
Detailed production data (including pressure)
–
Detailed cost data

Acknowledgments
 Wyoming Oil and Gas Commission
–
Production data, field files, technical support
 IHS
–
Production data and well information
 Merit
– Data on Bairoil CO
2 floods