|
|||||||||
 |
|
| |
|
Last month, 83.3% of our survey respondents indicated they were employed by Independents and 16.7% by Majors. Our question dealt with how your company ranks its investment opportunities to determine which projects receive capitalization first. Responses indicated that 22.2% of the companies use payout as their ranking criteria to determine which projects receive the company's investment capital, if the company is capital constrained. Of the remaining companies, 50% use rate of return and 27.9% use risked net present value as their ranking criteria. See Mike's Discussion Points. We will talk more next issue about the appropriate use of Investment Efficiency and Optimum Working Interest calculations, that can be used to aid the ranking of investment opportunities in conjunction with expected value economics. |
|
 |
|
| Why
did I learn about relative permeability in school?
Would any of us be surprised to hear that if you put water-based drilling or completion fluids on a gas sand that you might damage the reservoir? Well, of course we wouldn't be surprised. We see examples of that happening all the time, which is why we take precautions to use oil-based muds instead of water to prevent water-based fluids from damaging the clay-sensitive sands in a gas reservoir. Sometimes your friendly drilling engineer tells you not to worry about it. He'll say the drilling fluid might damage the reservoir a little, but since we are going to frac it anyway, any damage that results is probably near wellbore, and we can frac beyond it when we stimulate the well. Read further... |
|
 |
|
 |
|
CEC Energy Consultants assisted Tulsa-based Helmerich & Payne in the identification and evaluation of merger candidates, which resulted in a successful merger of H&P with Denver-based Key Production to form Cimarex Energy. CEC Energy Consultants combines with Rike Services to provide the US Commerce Department with training courses for Russian Oil & Gas Executives in the area of Concession Negotiation, Risk Assessment and Mitigation, and modern Economic Evaluation processes. CEC Energy Consultants combines with Rike Services to assist TotalFinaElf in providing 8-week training courses to train Indonesian nationals to become Well Operations Supervisors. |
|
 |
|
How many
times have you looked at an open hole log after a well was drilled
and thought you would soon have the best performing well in the field
… only to find after completing it that well production was significantly
less than expected. What happened! While this doesn't happen most
of the time, it happens enough to leave you with big questions as
to how the log could be so deceiving. If you had a zone you were trying
to complete that is thin, less than 10' thick, and deep, greater than
10,000', the probability of lack of success goes up substantially
no matter what the log looks like. Why, you ask? I am glad you asked,
as I want to devote the main section of our newsletter this month
to address how can a promising well turn out to be such a poor performer.
When evaluating a drilling prospect, a geologist and/or geophysicist often spend months pouring over data to determine where oil and gas deposits might have been trapped. By evaluating and acquiring data on a potential well, a company may have a sizeable investment in a prospect before any acreage is acquired or a well is drilled. The land department then makes a concerted effort, with great expense, to obtain the acreage position for the opportunity to exploit the prospect identified. Relying on logs indicating the prospect idea is correct and the reservoir does exist in what appears to be paying quantities, Engineering and Operations obtain a rig and get the prospect drilled, logged, and ready for completion. Up to this point in time, a company has put its best highly trained and experienced people on the project, and has perhaps invested many millions of dollars to now wait for the perforating of the well to test its ability to flow. While waiting to perforate the well, many companies celebrate their success, without carefully ensuring the zone is perforated correctly and accurately. While the perforating cost is a minor fraction of the overall cost spent to date, it is the MOST IMPORTANT operation that will directly determine the productive capability of this investment. If performed incorrectly, the perforating job could lead to subsequent bad decisions and poor investments, as the company tries to understand the cause of poor reservoir performance and/or tries to fracture stimulate what personnel may conclude is a tight or damaged zone. The problem of poor perforating technique stems from incorrectly correlating the correlation log with the open hole log to determine the perforating depths that will allow holes to be shot in the casing exactly opposite the open hole log calculated zone of interest. Correlation logs don't look anything like open hole logs, and yet many companies allow field personnel to make the correlation and hope the perforating job is performed without incident. As I mentioned previously, correct, precise perforations are critical if the zone of interest is thin and deep. While the company's highest level executives determine whether the well should be drilled or not, the unsupported field hand usually has sole responsibility for the most critical component of productivity, the perforating operation. Many operators use contract supervisors, assuming they know what they are doing. While the supervisor may have perforated hundreds of wells before, and while the depth may have been off by 10' on each one, the current well, thin and deep, may be the first perforating job where a 10' differential has a noticeable impact on productivity. The company may incorrectly determine the zone is tight or damaged when in fact it was perforated outside the zone of interest, perhaps in shales or tight sands. In teaching, I find every field supervisor comes to a training session with his own perspective as to how a well should be perforated. They are all convinced they perforate wells per company guidelines, but I find most of them are perforating incorrectly! If you would like to do a little test, ask your operations engineer to describe the proper procedure for perforating any well. Unfortunately, you may find your operations engineer may not know the right way to ensure a well is perforated correctly and on depth, and is assuming the field personnel are sufficiently qualified to perform the job. Even more disturbing, if you go to the field and ask the company man, who is the first line supervisor responsible for the well's operations, to describe how to correctly perforate a well, you may find he depends upon the service company engineer to do it correctly. In effect, you might find that no one in the company is actively and correctly determining that your well is perforated on depth. Companies maximize their investment dollars when someone within the company is trained and dedicated to know how to correctly perforate each of the company's wells. The proper sequence as taught by Jim Rike's well-renown Completion School is as follows: 1) Correlate the zone of interest from the open hole log to the correlation log 2) Tabulate correlation log collars and match with the gun collars 3) Note the average differences identified in comparing the log and gun collars and correct the odometer reading for the gun run 4) Now that all data is now referenced to the correlation log, run collars again to see if gun collars now duplicate the correlation log collars 5) Consider the CCL location as "tool zero" 6) If there is ANY question about the correlation, DON'T pull the trigger! Run a longer correlation strip and/or call the office for advice and support, but DON'T pull the trigger if there is any doubt about where that gun is located downhole. Using a short joint, correlation can be greatly simplified. When casing is ordered out, it is advantageous to have a "short" joint to place in the string near the zone of interest. This makes it much easier to tie subsequent runs together, especially when most casing joints are usually very close to the same length. An alternative to a short joint is a magnetic ring attached to the outside of the casing like a scratcher and provides collar-like response to the CCL. The bottom line is you can use industry mapping software and identify anomalies in every basin in North America where well performance does not compare to favorable looking log characteristics. This newsletter encourages you to check your corporate perforating procedures and verify your people know how to perforate a well on depth. Use today's technology to identify those opportunities where others have made mistakes that you might be able to benefit from their misfortune. When you do perforate correctly and on depth, would you be surprised to find that less than 25% of your perforations are open and capable of flowing into the wellbore? We'll talk next time about how you can make sure your perforations aren't severely restricting productivity. Best Wishes and Good Hunting! Mike Cherry, P. E. |
|
|
News
Highlights |
| OPEC
Sees Stables Oil Prices |
|
Upcoming
Events |
| 2003
North American Gas Strategies Conference November 3-4,2003 Calgary, Alberta Canada |
| CEC
Energy Consultants 6700 Woodlands Parkway Suite 230-304 The Woodlands, Texas 77382 Office: 713-502-9235 Fax: 281-419-1046 www.CECEnergyConsultants.com Mike.Cherry@CECEnergyConsultants.com |
| Since
1999, CEC Energy Consultants has been an engineering
project management firm that allows you to outsource operations, engineering,
and business development projects while maintaining project control.
Outsourcing maximizes your profitability by allowing you to allocate
your key employee personnel to the company's strategic projects, ensuring
operational success and safety. CEC uses industry software such as Geoplus Corporation's Petra Workstations for both geologic and engineering functions, to enhance the identification of new business development opportunities with existing or newly acquired assets. Petra is unparalleled in its ability to build isopach maps and log cross-sections, but more importantly from an engineering standpoint, to analyze and screen public data sources for acquisition and drilling prospect leads as well as other advanced geologic and engineering functions. CEC Energy Consultant's expertise in using the latest technology application tools will result in reserve additions and well productivity enhancements to your asset base. Visit our website to learn more about CEC Energy Consultants incredible new technological, engineering and operations capabilities. If you feel this newsletter would be of benefit to someone you know, please feel free to forward a copy as well as distribute anything I make available in these newsletters to your staff and employees. |
 |
||||
| Are
you hesitant to allow your mapping software to grid and contour your
maps, because time after time you get computer-generated contour maps
that look very unrealistic? Solutions exist for the common pitfalls
in computer contouring. Here is a tip to improve contouring visualization. I got this idea from two experienced geologist friends of mine, Vance Hall and Jewel Wellborn, who both do extensive computer-generated contouring and mapping. Zero contours have presented a challenge since the first gridding and contouring program was written. Computers just don't grid well in the vicinity of zero. This tip will help to improve the grid model and the resulting contours near the zero contour line where it represents the limit of the extent of a measured or calculated quantity. Read further... |
||||
 |
||||
 |
||||
 |
||||
 |
||||
 |
||||
| Rike
Services Geoplus
Corporation |
||||
 |
||||
 |
||||
North American Prospect Expo (NAPE) February 5-6, 2004 Houston, Texas SPE Annual Technical Conference and Exhibition September 26-29, 2004 Houston, Texas |
||||
 |
||||
|
||||
 We've
revised our website! Click here
to visit our site. |
| CEC Energy Consultants Home | Newsletter | News Release | Services | Credentials | Contact | Download | Site Map | ||
| Copyright © 2004-2008 CEC Energy Consultants | ||
| updated 01.06.08 | website design by tevadesign.com | ||