SOCIETY OF PETROLEUM ENGINEERS OF AIME PAPER

6200 North Central Expressway. NUMBER SPE 2094

Dallas, Texas 75206

THIS IS A PREPRINT --- SUBJECT TO CORRECTION

Practical Application of Computer

Technology to Petroleum and Gas Operations
By

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P. D. Gaffney, Member AIME, Gaffney, Cline and Assoc.,
Walton-on-Thames, England

© Copyright 1968
American Institute of Mining, Metallurgical and Petroleum Engineers, Inc.

This paper was prepared for the European Regional Meeting of the Society of Petroleum Engineers
of AIME, to be held in Milan, Italy, April 4-6, 1968. Permission to copy is restricted to an abstract
of not more than 300 words. Illustrations may not be copied. The abstract should contain conspicuous
acknowledgment of where and by whom the paper is presented. Publication elsewhere after publication
in the JOURNAL OF PETROLEUM TECHNOLOGY or the SOCIETY OF PETROLEUM ENGINEERS JOURNAL usually is
granted upon request to the Editor of the appropriate journal provided agreement to give proper credit
is made.

Discussion of this paper is invited. Three copies of any discussion should be sent to the
Society of Petroleum Engineers office. Such discussion may be presented at the ~bove meeting and,
with the paper, may be considered for publication in one of the two SPE magazines.

ABSTRACT engineering calculations. The application of

these techniques to the day-to-day engineering
Detailed reservoir calculations, large- problems besetting the individual field engi-
scale pipeline design and many refining opera- neer has not yet been universally accepted.
tions now are carried out with the use of This paper examines these applications in the
computer techniques. However, routine handling light of more recent computer and data proces-
of small projects such as the calculation of ing developments, and illustrates the
oil and gas reserves, the evaluation of pressurE advantages of applying such techniques to
buildup data for production and reservoir routine daily problems.
applications, etc., continues to be done to a
large extent by manual techniques. DEFINITIONS

This paper discusses the considerable "Data processing" in this context refers
potential for the operations engineer in using to all machine processing that requires simple
both the results of simple data processing and multiplication, division, addition and subtrac-
the new small scientific computer. It is con- tion and the carrying of totals. These tasks
cluded that valuable improvements in the use of need relatively uncomplicated sorting machines,
technical manpower would result from a greater printers, card readers, punches and a small
understanding and application of these modern arithmetic unit. A "computer", on the other
techniques. hand, refers here to a processing machine that
has considerable memory [storage] capacity and
INTRODUCTION can perform calculations much faster than the
simple data processing machine. However, while
The application of computers and data in many cases data processing problems are
processing to the solution of technical prob- carried out on computers because of their
lems for the petroleum industry has seen great greater capacity, it is rarely possible to
progress in recent years. However, in many reverse this and solve even simple engineering
respects, this application has been limited to problems on data processing equipment.
the more mathematically inclined and to those
engineering problems involving detailed repeti- THE PROBLEM BACKGROUND
tive solutions such as process and reservoir
Illustrations at end of paper. One reason for the delay in application of
 PRACTICAL APPLICATION OF COMPUTER
2 TECHNOLOGY TO PETROlEUM AND GAS OPERATIONS SPE-2Q94

these techniques at the operations level is capacity. Although the reservoir engineering
that most routine production statistics types of calculations have been handled by
currently are prepared on machines fully computers for many years they normally have
occupied and controlled by accounting depart- been run on high-cost systems in the hands of
ments, with whom the operations engineer rarely specialists far from the control of the field
comes in contact. A second reason has been the engineer. Thus, when an engineer wishes to
lack of small, reasonably inexpensive computing solve a practical problem, the time, expense
e~uipment that a company could afford to put and inconvenience of doing so usually prohibit
into a small engineering office where it might his obtaining such information. By taking
be expected to remain idle much of the time. advantage of the more recent computer develop-
Such computing machinery now has become avail- ments, these very complicated and detailed
able and it is appropriate to look at the calculations can be performed at field level.

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possibilities this equipment offers in in-
creasing the productive capacity of the en- The following sections will deal first with
gineer. accounting-type installations that can be made
to yield useful data for statistical analysis
The word "computer" tends to frighten many of the first type of problem"and then a small,
engineers engaged in the operating phases of low-cost computer capable of handling all three
petroleum engineering because of reservations types of problems.
about detailed mathematical calc~lations that
have somewhat theoretical and often impractical It should be stressed that the engineer
results. As a group they have been similarly does not have to be a programmer or a mathema-
dissuaded from using even elementary data tician. He simply needs to know what infor-
processing facilities because, in many cases, mation is available, what results [output] he
such processing has been associated with the wants and the flexibility of the computing
accounting function, where engineering work system he is dealing with.
takes a definitely second place. Therefore,
the advent of small systems that even the DATA PROCESSING APPLICATIONS
individual engineer can justify naturally opens
up considerable possibilities. A large number of operators routinely pre-
pare their monthly statistical data on well
The operations engineer must work with production utilizing punched card and associated
three different types of calculations: techniques. Thus a considerable amount of the
diagnostic data on the history of any well is
1. Those based upon analyzing historical available in this form. However, many of the
information such as well production data to producers who use punched card techniques and
decide on future service work, production, data processing print-out do not yet draw on the
handling, etc. wealth of data that they have on file. With
extremely simple sorting and printing tech-
2. Those involving the solution of an niques, at virtually no cost, this information
equation - for instance, the calculation of an can be made of considerable analytical value to
optimum line size and its capacity range under the operations engineer.
different conditions. In these cases, the
engineer often is dealing with a minimum of Table I illustrates an elementary example
basic information, and may want a considerable of this technique. The upper part of the table
volume of results to illustrate the entire shows part of a typical monthly production
range of possible circumstances. record for several wells. The lower part of
the table shows a series of monthly production
:3. Those calculations that actually are records for a single well, obtained by sorting
combination of both 1 and 2 - that is, the the monthly data cards in chronological order
analysis of historical statistical information so that the trends can be studied visually.
combined with an operation upon it in some de-
tailed calculation such as in a reservoir It is evident that the scope for scanning
analysis. visually or mechanically to facilitate rapid
and concise evaluation is almost limitless.
Statistical calculations like group 1 are easy Thus it would be possible to sort by producing
to handle by simple manipulation of existing rate, GOR, percent water, service rig-time,
data processing systems and visual techniques. etc.
Group 2 normally requires some form of more
detailed computing equipment so that multiple The next step in using data processing
solutions of complicated equations can be systems where the base information is already
obtained rapidly, while the combination type on file is to add coded data or additional
of calculation that may require days or weeks basic data to the existing monthly records.
manually is best handled by a computer with For example, information on frequency of well
considerable data storage and calculation service, reserves data, drilling data, cost
SPE-2094 P. D. GAFFNEY

data, or information on special production range of answers instead of the previously

conditions such as wax deposition or sand entry accepted rule-of-thumb calculation or "guess-
could be added in a separate card. All this timate" . However , it should be made clear
could easily be up-dated every month, and in that even the cherished rules of thumb can be
the process, any well falling below a preset built usefully into a program if so desired.
minimum of production or requiring excessive Not only does this machine availability allow
service could be listed for remedial work or the individual engineer to become a much more
abandonment consideration. Table 2 illustrates powerful member of the organization but also it
adding coded data to the wells in Table 1. makes it possible for him to investigate in
detail projects that otherwise he would dis-
Here, then, is a tool for analyzing not card or guess at because of their difficulties
just a single well but groups of wells or entirE in analysis. A typical machine of this type
fields. It should be stressed that all these would require an elementary knowledge of a
are relatively simple additions and do not programming language such as FORTRAN, an

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require that the operations engineer have any algebraic type of notation that allows the
knowledge of programming or detailed computer engineer to write programs in a simple form.
techniques. Most of the work can be initiated The machine then automatically translates his
by discussion with the existing data-processing program into machine language.
handlers and accounting personnel employed in
almost every operation. Initially this computer might be used to
rapidly calculate and analyze decline curves,
These results from just gathering and re- ultimate reserves, certain types of arti-
arranging data can be used to indicate well ficial lift and pumping well design programs,
service requirements and workover prospects. pipeline problems and complicated discounted
This systemizing could be carried to quite cash flows. A ready-made library of programs
detailed lengths, and the reports provided to for many petroleum engineering problems is
both the operating engineer and supervisors available for certain of these machines.
could be of considerable value right up the
line to top management. Such reports allow all Basically, the formulas or expressions
concerned to appreciate at a glance how the used for solving all common problems can be
individual well, field, or group of fields, is programmed and put into permanent storage on
running and what prospects there are for an the machine. Once in storage any program is
immediate increase in production or other always immediately available for use with new
progre.ss toward optimization. In these days of basic data. Each of these programs is so
constantly changing conditions and economics, arranged that, with simple control instructions
such information cannot readily be obtained by and the new basic data, it will perform the
any simpler means. calculation and present the results in an
immediately useful report form.
To give an idea of the magnitude of costs
under consideration, the cost of running a Table 3 shows some examples of common
monthly production report on a field with 500 calculations that can usefully be computerized.
active wells at a commercial data processing Their conversion into a FORTRAN statement also
center would not be more than $300 monthly, is illustrated. All these examples are of a
depending upon the number of wells, amount of relatively simple type but there is no reason
punching and detail that are required. Bearing why the engineer should not tailor his
in mind that this can represent the full-time personal programs to his own reqUirements.
work of 2 to 3 clerks, the advantages of such Once a program is written and stored it becomes
systemizing are obvious, even before con- possible to obtain a solution to the problem
sidering the production profits that should be with any new data.
encouraged by the direct review of print-out
results by the practical operations man. The average engineer should find that
with less than a week of computer orientation
COMPUTER APPLICATIONS he is adequately conversant with the basic
ideas involved to appreciate the. considerable
Let us now consider the small scientific advantages that such techniques offer and to
and engineering computer that can handle the program usefully some of his more preSSing
type of work discussed previously but that has problems.
the added advantage of considerable memory
[storage] and calculation power. Apart from A typical minimum system requires little
their value for routine reports and more de- more than a small 10 ft by 15 ft office and
tailed manipulations of the production data, consists of a processing unit and a card read
the main advantage of these systems is that and punch-out. To this might be added a fast
the computer can be close enough to the printer to supplement the console typewriter.
operati~~~neer that it will be used instead The cost of such a system runs about $1,500
of a slid:e"ruJ..e - this gives him an entire u. s. per month; or little more than the
 PRACTICAL APPLICATION OF COMPUTER
4 TECHNOLOGY TO PETROLEUM AND GAS OPERATIONS SPE-2094
~ over-all cost to the producer of another one ally desirable and economically attractive for
or two men on the engineering staff. However, the application of these techniques to be more
such a machine in the hands of experienced vigorously encouraged.
operations engineers will increase the scope of
their usefulness several-fold and enhance their CONCLUSIONS
ability to investigate fairly large projects on
their own. FUrther it enables these engineers 1. Operations engineers can usefully
to consider the wider ramifications of such apply computer techniques to day-to-day opera-
projects. tions to improve their capacity for effective
examination of time-consuming technical pro-
The operations engineer is frequently in blems and methods of controlling production
a much better position than others to apply economics.
limiting practical conditions in calculations

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involving improvements and/or new designs. 2. Even the product of unsophisticated
However, if he is excluded from the original data processing systems can be utilized to ease
planning, and does not have resources to do the massive data analysis problems facing all
such work himself, his valuable contribution operations engineers.
may be lost. The use of the small computer can
upgrade his capacity and fill this considerable 3. No particular mathematical or elec-
gap. tronic background is necessary to take advan-
tage of these modern techniques.
SUMMARY
4. The engineer can usefully program both
The use of two basic systems of data routine reports and more complicated analyses,
analysis has been described and an attempt has so that they can be obtained directly from the
been made ,to correct the common misconception computer or data processing equipment in
that the computer is for only the mathemati- finished report form ready for distribution.
cally inclined and for use on major projects
involving huge expense. Seen in their proper 5. For maximum advantage the computer or
perspective, computers are just an additional -aata processing system must be located close
tool in the hands of the operations engineer; enough to" the operations engineer to avoid
they give him the additional capac!ty to delay in obtaining results J this should make i t
examine a problem in greater depth and in economically attractive to program the solution
general to perform much more productive of even the simplest day-to-day calculations.
engineering work. Thus _i1;~ ~is~ .b~thprofession-

TABLE 1
AN ABBREVIATED MONTHLY PRODUCTION REPORT FOR A RESERVOIR
Last Test
Well Reservoir Percent Monthly
No. Code Date Status Choke THP BOPD BS&w GOR Oil

293 202 9/67 F 12 710 289 2.0 850 6,293

294 202 9/67 F 16 480 125 0.1 868 354

295 202 9/67 P 20 40 21 0.1 880 308

CARDS FOR WELL 293 SORTED ACCORDING TO DATE

293 202 5/67 F 8 850 450 0.0 625 4,020

293 202 6/67 F 9 800 427 1.2 660 12,000

293 202 7/67 F 10 770 375 2.0 691 10,200

293 202 8/67 F 10 760 322 2.0 725 9,175

293 202 9/67 F 12 710 289 2.0 850 6,293

 TABLE 2

CODE DATA CARD

Other
Service Remaining Prospects
Well Reservoir Date Hours Reserves in Wellbore

293 202 9/ 67 0 81,203 B

294 202 9/67 0 61,872 A,C

295 202 9/67 82 40,480 A,B,C

SUMMARY PRINT-Our AND SUMMARY CARD

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[Table 1 Monthly Data plus Code Data]
Other
Monthly Service Remaining Prospects
Well Reservoir Date Status Oil Hours Reserves in Wellbore

293 202 9/67 F 6,273 0 81,203 B

294 202 9/67 F 3,521 0 61,872 A,C

295 202 9/67 P 308 82 40,480 A,B,C

When these data are merged [combined] and printed out it might be
appropriate to flag with X's those wells with excessive service time or low
remaining reserves that, nevertheless, have reasonable. workover prospects.

TABLE 3
COMMONLY USED CALCULATIONS THAT CAN
USEFULLY BE COMPUTERIZED
Example Formula or Actual FORTRAN
No. Item Expression [IBM 1130] Version

1 Bottom-hole
Pressure
Buildup Cal- DI/[TI + DI] DI/[TI + DI]
culation of
time Parameter
2 Ultimate oil
reserves for [Pl - P2 1365
different Q. l.JJg [1 - D) Q = [Pl - P2]*365/ALOG[1.O-D]
decline rates
and production
limits

3 Oil line
throughput S = (. V j1.85 S = [V/(1.318*C*[R**0.63])]**1.85
calculations O
\1. 318CR •63)
[Williams
and Hazen]