Vaca Muerta - The Leading Shale Play in Latin America 2-4 December | Buenos Aires, Argentina InterContinental Hotel Assessment of Vaca Muerta Formation Shale Oil Production Decline-Curve Analysis Anticlinal Picún Leufú Nicolás Gutierrez Schmidt, Julio C. Alonso y Adolfo Giusiano Dirección de Estudios www.energianeuquen.gov.ar December, 2012 [email protected] [email protected] [email protected] Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Outline • Introduction to Neuquén Basin Source Rocks of Neuquén Basin Vaca Muerta Formation: Ro, TOC, Tickness, Area • Oil production of Neuquén province Production of Conventional and unconventional Oil Bajada del Palo a-7 well • Production decline-curve analysis Analysis of Decline models Forecast of Vaca Muerta Shale Oil production • Discussions Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Neuquén Basin Cuenca Neuquina Neuquén Bahía Blanca Buenos Aires Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Source Rocks of Neuquén Basin Vaca Muerta Upper Agrio Lower Agrio Los Molles Lower Quintuco Vaca Muerta Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Vaca Muerta Formation Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Vaca Muerta Formation Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Vaca Muerta Formation Vaca Muerta Formation Area with potential for oil and gas exploration DRY GAS WET GAS OIL • Area: 3,508,900 acres (14,200 km2) • Tickness: to 984 ft (300 m) • Ro: 0.6 to 1.2 % (oil) • TOC: 2 to 8 % Conventional and Unconventional Oil Production Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Conventional and Unconventional Oil Production Oil and Condensate production in the Neuquén province was 115.5 Mbbl/d (18,386m3/d) in July, 2012. • Main fields: – El Trapial-Curamched (Chevron Argentina S.R.L) – Puesto Hernández (Petrobras Energía S.A) – Chihuido de la Sierra Negra (YPF S.A.) Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Bajada del Palo a-7 well • Target: Evaluation of Vaca Muerta (1983) • Depth: 9,160 ft (2.792 mbbp) • Ro=0,6 (oil window) Vaca Muerta Top • TOC=4%. • Thickness: 410ft (125m) Perforations Tordillos Top Shale Thickness (Passey et.al 1990) Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Bajada del Palo a-7 well August 2012 Fracture Fracture ? Plus Oil: 63Mbbl • State: In effective production. • Art. Lift: Beam Pump. • Oil Prod. = 54.7 bblpd (8.7 m3/d) • Oil. Cum = 752.3 Mbbl (119.6 Mm3) • Prod. time: 27 years. Hyperbolic Match Di:0.024 A.n b: 1.5 Dmin: 6%/yr EUR @ 2030: 875.4 Mbbl Production forecasting – Decline analysis Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Declination models • To take into account: – Very-low permeability reservoirs – Wells with hydraulic fracture stimulation – Flow transient for long time – Drainage area is not necessarily circular – What type should be used? – Minimum production time for reliable forecast? Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Declination models • ARPS – Hyperbolic • Stretched Exponential Model • Duong Model Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis ARPS – Hyperbolic Curve where: t: time (months) q(t): rate to time t (m3/d or bblpd) qi: initial rate (m3/d or bblpd) to t=0 b: Arps parameters Di: Initial decline qi, Di y b Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis ARPS – Hyperbolic Curve 50 THEORETICAL BASIS FOR ARPS’ DECLINE EQUATION: To “Di” and “qi” constants • Well or reservoir in boundarydominated flow (BDF) • Constant radius drainage 5 • No transient flow data b= 1.8 b= 1.5 month 288 264 240 216 192 168 120 96 72 48 24 0.5 144 b= 1 b= 0.5 0 bblpd • Production at constant BHP • Solution for 0<b<1 • In 24 months’ time there are no significant differences between in the curves with b from 1.5 to 1.8. • Special attention on b estimation on short production periods. Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis ARPS – Hyperbolic Curve 35000 30000 32% 20000 47% 15000 10000 5000 0 0 12 24 36 48 60 72 84 96 108 120 132 144 156 168 180 192 204 216 228 240 252 264 276 288 300 Cumulative (m3) 25000 Month For a period of 25 years, keeping constants ‘Qi’ and ‘Di’, there is a difference of EUR of 32% between b=1.5 and b=1.8. Comparing the first ‘b’ value with b=1, the difference is 47% less. Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Modified Hyperbolic Model VERY LOW PERMEABILITY RESERVOIRS: MODIFIED HYPERBOLIC MODEL • Best-fit ‘b’ values almost always > 1 • In many cases EUR are over-estimated. • Flow transient for large time periods. 100 m3/d 10 Dmin 1 Meses 384 336 288 240 192 144 96 48 0 0.1 Combination with exponential curve (minimum terminal decline rate, Dmin) makes the model applicable, giving a reasonable reserves to finite time. Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Bakken Shale – Horizontal Well Example: North Dakota Bakken EUR @ 30 years 546Mbbl (86.000m3) Fracture stages: 28 to 32. Lateral length: 9,186 ft (2,800 mts) ARPS parameters: qi = 459 bbl/d (73 m3/d) b= 1.4 Di= 0.197 Source: J. Mason – Oil Production Potential of the North of Dakota Bakken (February, 2012) Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Production decline-curve analysis Methodology • Estimation of ‘b’ and ‘Di’ parameters by fitting of production data with the mathematical model and by minimizing squared error (MS Solver Excel). • The wells with more production history are used • A maximum and minimum is considered for estimation of the type well. (Source: SEN Cap. IV) Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Production decline-curve analysis – Study zone Dry Gas Lower Quintuco Wet Gas Oil Vaca Muerta Zone of production wells. Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Production decline-curve analysis – Study zone Vertical wells • Fracture stages: 3 • h average: 330 ft (100 m) Horizontal wells • Lateral length: 3,281ft (1,000 m) • Fracture stages: 10 • xf: 130 ft (40 m) • h average: 164 ft (50 m) Analysed wells results Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Vertical Wells - Fm Vaca Muerta 16,000 100 Vertical-type well Vaca Muerta Max. well 12,000 10 10,000 8,000 6,000 1 4,000 Med. well Min well Nq.VMUT-2 Nq.VMUT-3 Nq.VMUT-4 Nq.VMUT-1 Cum. Max 2,000 Cum. Med 0 Cum. Min 24 12 0 0.1 Cumulative (m3) Production rate (m3/d) 14,000 Months Max. Well Med. Well Min. Well qi (m3/d) 54 32 28 b 1.69 1.81 1.30 Di n.yr 0.45 0.46 0.40 Dmin (%/yr) 6 6 6 t @ Dmin (yrs) 9.75 9.11 12.66 q @25 yrs (m3/d) 1.51 1.03 0.45 EUR @ 25 years: 176,120 bbl (28,000 m3) Range: 98 Mbbl – 620 Mbbl Arps parameters: qi= 200 bbl/d (32 m3/d) Di=0.45 b= 1.8 Dmin= 6%/yr EUR @ 25 yrs (m3) 42,500 27,900 15,600 Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Horizontal well - Fm Vaca Muerta 70,000 Only a well with considerable production period. 60,000 50,000 40,000 10 30,000 20,000 10,000 0 0 12 24 36 48 60 72 84 96 108 120 132 144 156 168 180 192 204 216 228 240 252 264 276 288 300 1 Months Nq.VMUT-5(h) Source: CAP IV SEN Horizontal-typed well Vaca Muerta Horizontal well Cum. Hor. Well Cumulative (m3) Production rate (m3/d) 100 EUR @ 25 years: 389,000 bbl (61,800 m3) Arps parameters: qi= 336.5 bbl/d (53.5 m3/d) Di=0.25 b= 1.8 Dmin= 6%/yr Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Vertical wells Vs. Horizontal well - Fm Vaca Muerta 70,000 100 389Mbbl 60,000 50,000 x 2.2 40,000 30,000 Vertical type well Cumulative (m3) 10 176.1Mbbl 1 20,000 10,000 0 0.1 0 12 24 36 48 60 72 84 96 108 120 132 144 156 168 180 192 204 216 228 240 252 264 276 288 300 Production rate (m3/d) Horizontal Well vs. Vertical Wells Months Nq.VMUT-2 Nq.VMUT-3 Nq.VMUT-4 Nq.VMUT-1 Horizontal well Nq.VMUT-5(h) Cum- Vert. Type well Cum. Hor. Well Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Horizontal well – Lower Quintuco + Vaca Muerta 140,000 Only a well with considerable production period. Horizontal well Lower Quintuco + Vaca Muerta 120,000 100,000 80,000 10 60,000 40,000 Cumulative (m3) Production rate (m3/d) 100 EUR @ 300 meses: 812,416 bbl (129,160 m3) 20,000 1 0 12 24 36 48 60 72 84 96 108 120 132 144 156 168 180 192 204 216 228 240 252 264 276 288 300 0 Months Hor. Well QTUC+VMUT Sourse: CAP IV SEN Nq.QTUC-VMUT-1 Cum. QTUC+VM Hor. Well Arps parameters: qi= 500 bbl/d (80 m3/d) Di=0.125 b= 1.8 Dmin= 6%/yr Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Lower Quintuco + Vaca Muerta Vs. Vaca Muerta 140,000 100 812Mbbl 120,000 80,000 447.8Mbbl 389Mbbl 60,000 1 40,000 x 2.2 176.1Mbbl 20,000 0.1 Months 300 288 276 264 252 240 228 216 204 192 180 168 156 144 132 120 108 96 84 72 60 48 36 24 12 0 Cumulative (m3) 100,000 10 0 Production rate (m3/d) x 2.1 Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Discussions Based on the study is considered that: • It can adjust with decline curves for the analyzed wells, obtaining values of EUR that differentiate the performance between horizontal and vertical wells and different producing intervals, besides giving results comparable to other shale plays. • The approach taken in this study of rate production decline is comparable with that adopted in others basins, such as Bakken Shale. • It is indicative that there would be better performance in the horizontal wells in the Vaca Muerta formation, increasing it by a factor of 2.2 from vertical wells, which are also increased by a factor of 2.1 with the participation of lower Quintuco. Assessment of Vaca Muerta Formation Shale Oil: Production Decline-Curve Analysis Discussions • The Arps parameters have values in the order of other shale plays estimations with a average value of ‘b’, for Vaca Muerta’s wells, of 1.8. The Di value can vary from 0.45 to 0.25. • Might be considered that a production period of at least two years can get production forecasts with significant reliability. • From the analyzed wells it would be indicator that the EUR is directly proportional to the initial production rate, being it related to well completion (fracture design and number of fracture stages). Any questions? Thanks for your attention