Spe 198656 Ms
Spe 198656 Ms
This paper was prepared for presentation at the SPE Gas & Oil Technology Showcase and Conference held in Dubai, UAE, 21 - 23 October 2019.
This paper was selected for presentation by an SPE program committee following review of information contained in an abstract submitted by the author(s). Contents
of the paper have not been reviewed by the Society of Petroleum Engineers and are subject to correction by the author(s). The material does not necessarily reflect
any position of the Society of Petroleum Engineers, its officers, or members. Electronic reproduction, distribution, or storage of any part of this paper without the written
consent of the Society of Petroleum Engineers is prohibited. Permission to reproduce in print is restricted to an abstract of not more than 300 words; illustrations may
not be copied. The abstract must contain conspicuous acknowledgment of SPE copyright.
Abstract
Planning the position of a new well is an essential task to increase hydrocarbon production. However, trying
to capture the uncertainty related to the geological properties, an ensemble of geological realizations of the
models must be considered. The objective can be to identify the locations of the new wells that maximize the
average oil recovery or Net Present Value (NPV), for an ensemble of geological models. Also, considering
an ensemble of geological models, an objective can be to minimize the standard deviation of the NPV (or
cumulative oil recovery). Reducing the uncertainty on the NPV leads to reduce the risk for the placement
of the new wells. These two objectives can be defined with a "mean-standard deviation" formulation of
the objective function. Following the weight given to each objective, the placement of the wells is not the
same. To know all the well-placement possibilities and associated risk, many optimization problems must
be done. Such as procedures, require the use of optimization method and reservoirs simulations on each
reservoir model. This optimization problem leads to a high number of reservoir simulation to determine
the appropriate location and can be expensive in computation time. To reduce the computation time, a
method consists in to substitute the reservoir simulator by a meta-model. In this paper, the use of an artificial
neural network as a proxy model is considered. The objective is to propose a method to speed up the well-
placement optimization process using a proxy model based on an artificial intelligence technique to replace
the reservoir simulator. The proposed methodology considers an ensemble of realization and aims to provide
an overview of solutions in an economic point of view inspired by portfolio optimization problems. An
application of the methodology is presented for the Brugge field.
Introduction
The localization of new wells is a challenging task in the oil field development plan. Many authors are
proposing to maximize the oil recovery or the Net Present Value (NPV) by controlling the location of the
new wells. Some of them consider a deterministic reservoir model while others consider an ensemble of
reservoir models to take into account the geological uncertainty.
This problem has been addressed considering the reservoir model as deterministic. Gradient-based
methods have been applied to maximize NPV (Sarma and Chen, 2008; Zandvliet et al., 2008). From a
mathematical point of view, well-placement optimization is a challenging task due to the complexity of
2 SPE-198656-MS
the objective function usually composed of several local minima. To avoid the convergence to these local
minima, several authors proposed to use derivative-free algorithms. Emerick et al. (2009) had developed
a computer-aided optimization tool based on a genetic algorithm to optimize well-placement considering
arbitrary well trajectories. Bouzarkouna et al. (2013) proposed to couple the Covariance Matrix Adaptation
Evolution Strategy (CMA-ES) (Hansen and Ostermeier, 2001) optimizer with surface response models
and artificial neural network) have been widely used for reservoir engineering problems such as history-
matching, production forecasting, and production optimization. With the continued increase in computer
power, artificial intelligence techniques have rapidly met interest in the reservoir engineering community.
In 1988, Guérillot proposed an Expert System (ES) based on the concept of fuzzy logic to identify the most
suitable Enhanced Oil Recovery (EOR) process to apply in a given reservoir. Artificial neural networks
(1)
where X is a vector of optimization variables (i.e., well location, well production/injection parameters), T
is the number of time steps, is a time step, QO is the oil production rate, QW is the water production rate,
QO is the water injection rate, rO is the oil price, rw is the water production cost, rI is the water injection cost,
d is an annual discount rate, ti is the cumulative time, N is the number of new well and Cj is the drilling
cost applied to new wells.
Uncertainty is considered through the use of a set of reservoir models representing the variations of the
geological properties. For all these models, we suppose that the calibration of the history of production data
has been done. The objective is to provide an optimal localization of new wells in term of return/risk ratio.
The multi-criterion problem to solve consist of maximizing the average of the NPV and minimizing the
standard deviation of NPV. The aim is to find such as:
(2)
4 SPE-198656-MS
where X is a vector defining the optimization variables (i.e., well location, well production/injection
parameters), U is the search space, α is a coefficient between [0,1], Ω is a set of geological realizations, EΩ
is the average operator and σΩ is the standard deviation operator.
Following the value of α, the objective function advantage the maximization of the NPV or the
minimization of the standard deviation. A value of α equals to one correspond to the classical formulation
Sharpe Ratio
Sharpe (1994) defined the performance of one solution respect to its risk with an indicator measuring the
ratio of the gain expected and the standard deviation of the gain.
(3)
Methodology
The proposed methodology aims to provide an overview of the possible solutions with the associated "risk-
expected return" associated. This workflow implies to perform an optimization process for each formulation
of the objective function, i.e., for different value of α. Given the geological uncertainty resulting from a set
of geological realizations, each optimization process is all the longer as the number of reservoir models is
significant. To reduce the computation time, an artificial neural network as a proxy model is used. The use
of a proxy implies to generate a database representing the problem to reproduce. The ANN is then trained
using the learning database. An approximation of the objective function is designed with the outputs of the
ANN. Global optimizations are done for each value of α. To finish, an overview of the solutions with the
associated Sharpe index is done. The steps of the methodology are described below.
1. Artificial neural network. A multilayer perceptron is used as a proxy model providing the average
NPV and standard deviation of the NPV of an ensemble of geological realization for a given
configuration, i.e., the well location parameters (cf. Fig. 1). The ANN is composed of one hidden layer.
The activation function of the hidden neurons is sigmoidal. The activation function of the neurons of
the output layer is linear. Cybenko (1989) and Hornik (1993) have shown the universal approximation
capacity of such ANN;
2. Experimental design. To efficiently generate a learning database, a classical approach based on
experimental designs (ED) consists of select the data to cover the space of parameters to obtain the
SPE-198656-MS 5
most information with a minimum of data (Amudo et al. 2009). Following the type of proxy model,
some experimental designs are more appropriate to fit a model, e.g., Plackett-Burman experimental
designs suit to design first-order models, Box-Behnken experimental designs suit to design second-
order models. According to the complexity of the model, experimental designs consider or not the
interactions between parameters. Here, the Box-Behnken experimental design is used. This type of
NPV form the efficient frontier, i.e., the location of the wells that maximizes the average NPV for a
given level of risk. For each solution, the Sharpe ratio is given.
Figure 2—Flowchart of the well placement methodology: (1) Learning phase to design
an artificial neural network; (2) Optimization of well-placement for different value of α
using the ANN; (3) Solution analysis to identify the best "risk-expected return" solution.
Brugge Field
The presented methodology is applied to optimize the well-placement to the Brugge field. This
synthetic case study has been provided by TNO to benchmark methods addressing history-matching and
waterflooding optimization problems. The geological description of the case is given by Peters et al. (2010).
SPE-198656-MS 7
The Brugge field properties are similar to the Brent field located in the North Sea. The reservoir is defined
with four zones coming from multiple deposit environments.
Thirty vertical wells (20 producers and 10 injectors) has been drilled. First, the 20 producers are drilled
from 1998 to 1999, then each month an injector well is drilled. The first ten years of production data are
available. To evaluate the methodology, the existing injection wells have been removed from the Brugge
To generate the neural network learning database, a Box-Behnken experiment plan has been used (761
configurations) and randomly generated configurations in the parameter space (250 configurations). Fifty
randomly generated configurations were used to build the validation database. For each configuration of
the placement of wells, a flow simulation is performed for the 50 reservoir models assumed to represent the
uncertainty associated with the geological parameters. The output data are the average of the NPV and the
standard deviation of the NPV of the 50 simulations.
Figure 3 shows the ability of the ANN to reproduce the learning data and to predict the validation data
for the average and the standard deviation of the NPV for an ensemble of geological models.
Figure 3—Cross-validation plots showing the ability of the ANN to reproduce the
learning data (•) and the validation data (˚) for average EΩ[NPV] (left) and σΩ[NPV] (right).
8 SPE-198656-MS
Optimization of the placement of the wells is done, for ten values of α, using the outputs of the ANN
to compute the value of the objective function. Figure 4 shows the efficient frontier for the mean-standard
deviation optimizations and associated Sharpe ratio for ten different value of alpha α. The optimized
solutions for α=0.1 et α=0.2 have a Sharpe ratio between 0 and 1, i.e., a risk too high compared to the
expected return. For α ≥ 0.3, the optimized solutions have a Sharpe ratio higher than one, i.e., a solution
Conclusions
Plan the position of a new well is an essential task in order to increase hydrocarbon production. This
optimization problem requires a high number of reservoir simulation to determine the appropriate location.
In an economic context, it is essential to evaluate the risk to reach an expected NPV. The mean-standard
deviation analysis, well known for portfolio optimization problems in finance, allows evaluating this
risk. For the well placement optimization where the uncertainty is taken into account considering a set a
geological realization, the mean-standard deviation analysis is costly in term of the number of reservoir
simulations.
In this paper, a methodology to address the problem of well placement optimization using the mean-
standard deviation formulation, coupled with an artificial neural network as a substitute to the reservoir
simulator is presented. The ANN provides the average NPV and standard deviation of the NPV of an
ensemble of geological realization for a given wells configuration. The CMA-ES optimizer is coupled with
the ANN to speed-up the optimization processes for many formulations of the objective function (i.e.,
different values of α). This approach allows providing a complete overview of the information on the gain
expected and risk is taken through the efficient frontier and the Sharpe ratios.
The workflow has been applied for optimization of the injector wells location of the Brugge field.
Acknowledgments
This project was supported by Texas A&M University at Qatar. We acknowledge Schlumberger for their
donation of Petrel software and Eclipse 100 simulator.
SPE-198656-MS 9
Nomenclature
Cj = drilling cost applied to new well j [$]
d = annual discount rate [-]
J = objective function
= approximation of the objective function
References
Alrashdi, Z. and Sayyafzadeh, M. (2019). (μ+ λ) Evolution strategy algorithm in well placement, trajectory, control and
joint optimization. Journal of Petroleum Science and Engineering, 177, 1042-1058.
Amudo, C., Graf, T., Dandekar, R. R. and Randle, J. M. 2009. The pains and gains of experimental design and response
surface applications in reservoir simulation studies. In SPE Reservoir Simulation Symposium. Society of Petroleum
Engineers
Awotunde, A. A. and Sibaweihi, N. (2014). Consideration of voidage-replacement ratio in well-placement optimization.
SPE Economics & Management, 6(01), 40-54. doi:10.2118/163354-PA
Bouzarkouna, Z., Ding, D. Y. and Auger, A. 2013. Partially Separated Metamodels With Evolution Strategies for Well-
Placement Optimization. Society of Petroleum Engineers. doi:10.2118/143292-PA
Bruyelle, J. and Guérillot, D. 2014. Neural networks and their derivatives for history matching and reservoir optimization
problems. Computational Geosciences, 18(3-4), 549-561
Bruyelle, J. and Guérillot, D. 2019. Optimization of Waterflooding Strategy Using Artificial Neural Networks. SPE
Reservoir Characterisation and Simulation Conference and Exhibition (RCSC 2019)
Bruyelle, J. and Guérillot, D. 2019. Proxy Model Based On Artificial Intelligence Technique For History Matching -
Application To Brugge Field. Gas & Oil Technology Showcase and Conference (GOTECH 2019)
Capolei, A., Suwartadi, E., Foss, B. and Jørgensen, J. B. 2015. A mean–variance objective for robust production
optimization in uncertain geological scenarios. Journal of Petroleum Science and Engineering, 125, 23-37
Costa, L. A. N., Maschio, C. and Schiozer, D. J. 2010. Study of the influence of training data set in artificial neural network
applied to the history matching process. In Rio Oil & Gas Expo and Conference
Couet, B., Burridge, R. and Wilkinson, D. 2004. U.S. Patent No. 6,775,578. Washington, DC: U.S. Patent and Trademark
Office.
Cybenko, G. 1989. Approximation by superpositions of sigmoidal functions.Mathematics of Control, Signals, and Systems
Emerick, A. A., Silva, E., Messer, B., Almeida, L. F., Szwarcman, D., Pacheco, M. A. C. and Vellasco, M. M. B. R.
2009. Well placement optimization using a genetic algorithm with nonlinear constraints. In SPE reservoir simulation
symposium. Society of Petroleum Engineers.
10 SPE-198656-MS
Foroud, T., Seifi, A., and AminShahidi, B. 2014. Assisted history matching using artificial neural network based global
optimization method–Applications to Brugge field and a fractured Iranian reservoir. Journal of Petroleum Science
and Engineering, 123, 46-61
Forouzanfar, F., Poquioma, W. E. and Reynolds, A. C. 2016. Simultaneous and sequential estimation of optimal
placement and controls of wells with a covariance matrix adaptation algorithm. SPE Journal, 21(02), 501-521.
doi:10.2118/173256-PA