Introduction to Exploration & Production

A 3-Day Course Blended with E&P Interactive CBT

Peadar McKevitt
NExT Commercial & Distributed Learning Manager
Peadar McKevitt

3 years NExT Schlumberger

NExT Commercial & Distributed Learning Manager: Dublin, Ireland

6 years IT: Internet, Telecom, Multimedia, eLearning

Technical Trainer & Consultant, Ericsson
[Stockholm, Sweden & Dublin, Ireland]

6 years Schlumberger
Geophysicist, Geologist, MWD, LWD, Directional Drilling, GeoSteering
[UK, Norway, US, Singapore, Australia]

Academics
U.C.G. M.I.T. [Masters Information Technology]
Uni. Aberdeen Master of Petroleum Geology
U.C.D. B.Sc. [Ex.Physics, Geology, Maths]
Jeff Johnson

3 years Schlumberger
Next Director of Training: Geoscience / Petrophysics - Tulsa

22 years Experience with Amoco / BP

Applied Seismic Technology – New Orleans
Manager, Geophysical Technology, Amoco International
General Manager, Geoscience Research and Technology – Tulsa /
Houston

Academics
Stanford Geophysics Degrees
Boston College Prof. Geophysics
University of Oklahoma Adjunct Research Associate
 Network of Excellence in Training

• Commercial Joint-Venture: E&P Training

• 150 Short Courses/Programs
• University and SLB Instructors
• Computer-Based Training
• Global Presence
Texas A&M University The University of Oklahoma
Petroleum Engineering Center of Well Engineering, Geoscience /
Excellence Petrophysics Centers of Excellence.

Heriot-Watt University
Distance Learning in Petroleum
Engineering Center of Excellence
Training Service Portfolio
www.next.ie
„ Open courses (all oilfield disciplines)
„ Closed courses / programs (client customized)
„ Technical Skills assessment
„ Integrated training solutions - programs
• Subsurface Integration, Deepwater
„ Distributed Learning / e-Learning
Course Objectives – Awareness Level

„ Understand the origin and nature of oil fields

„ Understand the basic operational and technical activities
involved in E&P and why they are done
„ Discuss the role of Schlumberger and its products / services
in E&P
„ Discuss the role of IT and SEMA and your jobs in
Schlumberger and E&P overall
Computer Based Course
NExT E&P Interactive
20 Modules on 5 CD’s covering E&P Technical and Business
Activities
„ Exploration - Geoscience
„ Reservoir Appraisal - Engineering
„ Reservoir Development - Drilling
„ Production Operations – Completions / Facilities
„ 4 Interactive Workshops
„ Pre and Post Module Assessments
E&P Introduction - The Upstream Industry Topics

„ Business and Reservoir Life Cycle

„ Geology and Geophysics: Exploration
„ Reservoir Engineering: Appraisal
„ Drilling: Reservoir Management
„ Production: Operations and Facilities
 EPI Blended Course
„ The E&P Reservoir Cycle and IT Role „ Reservoir Development / Drilling Review
– Key points
– Challenge
– Questions
„ Exploration / Geoscience Review „ Production Operations Review
– Key points – Key points
– Challenge – Challenge
– Discussion of attendee questions – Questions
„ Reservoir Appraisal / Engineering Review „ Team Questions / Presentations for
–Key points Development and Operations
–Challenge
–Discussion of attendee questions
„ Team Questions / Presentations for „ Summary / Downstream / Real Time
Exploration and Appraisal Oilfield Management
– SLB Business Segments
What is Petroleum?

„ Petroleum: a natural yellow-to-black liquid hydrocarbon

found at and beneath the earth’s surface,
„ Hydrocarbon: an organic compound made up of carbon and
hydrogen atoms.
The Goal - ‘Black Gold’
Petroleum Supplies our Energy Needs
Light Crude Heavy Crude
Palo Pinto Field Humble Oil Field
North Texas Southwest Texas
History of Petroleum
First Use „ Egyptians: oil to preserve mummies,
„ Chinese: natural gas for fuel,
„ Babylonians: oil to seal walls and pave
streets,
„ Americans: tar to seal canoes.

First Drilling „ Chinese using bamboo: to 800 in 347 AD

„ Americans using cable tool: to 70’ in
1859 AD
First Product „ Kerosene for lamps
„ Gasoline was unwanted by-product

Demand Increase „Industrial Revolution

– Internal Combustion Engine (1885)
– Global Economic Growth
Petroleum Products
A Barrel of Crude Oil Provides:
Gasoline - 19.5 gallons
One Barrel =
42 gallons Fuel Oil - 9.2 gallons

Jet Fuel - 4.1 gallons

Asphalt - 2.3 gallons
Kerosene - 0.2 gallons
Lubricants - 0.5 gallons
Petrochemicals,
other products - 6.2 gallons
American Petroleum Institute,
1999
Petrochemical Products
More Than 3,000 Products
„ Detergents – Cosmetics
„ Fertilizers - Weed Killers
„ Medicine - Antiseptics – Anesthetics
„ Plastics - Synthetic Fibers
„ Synthetic Rubber
„ Rust Preventatives
„ Liquid Petroleum Gas

American Petroleum Institute,

1999
Global Oil and Gas Fields

Gas
Oil
Largest Hydrocarbon Basins by Ultimate
Potential
World Fuel Consumption: 1975-2000
Oil
Natural Gas
8,00 Nuclear Energy
0 Hydroelectricity
7,00 Coal
Million tonnes oil equivalent

0
6,00
0
5,00
0
4,00
0
3,00
0
2,00
0
1,00
0
0

1999
1975

1987
1979

1993
1983
1977

1981

1985

1989

1991

1995

1997
Year
Cook and Sheath
 Projected World Energy Supplies
Careers in
Oil & Gas Hydroelectric

New Technologies
1993 Will be Important
100
100 BILLION
BARRELS Solar Wind
Geothermal
80
Billion World Energy Demand
Nuclear Electric
Coal
Equivalent

(GBOE) Natural
40 Gas

Fossil Fuels
Decreasing
Crude Oil
20

Tar Sands/Oil Shales

1900 1920 1940 1960 1980 2000 2020 2040 2060 2080 3000
after Edwards,
AAPG 8/97
E&P Companies “Big is Better”

Multinationals ExxonMobil

National (NOC) Saudi Aramco

Large Independents Apache

Small Independents Big Joe Production

Service Companies Schlumberger

Consulting Gaffney & Cline

Business Drivers “Increase Shareholder Value”

„ Minimize cost
„ Increase production
„ Increase reserves
„ Generate new opportunities
„ Use competitive advantage
„ QHSE
Industry Environment

„ Mature business
„ Volatile prices
„ Decreasing opportunities
„ Difficult operating environments
„ Technology (IT) explosion
„ Human resource issues
DOE Oil Price Forecasts
Linear Trends Predicted Beginning From the Actual Price of
Year Listed
120

100
Dollars per Barrel

80

60

40 Actual

20

0
1975 1980 1985 1990 1995 2000 2005
Year after U.S. Department of Energy, 1998
Global Exploration
Opportunities for Future Growth

N. Sea W. Siberia
E. Canada Sakhalin
Caspian
China
N Africa
GOM Vietnam
Venezuela W. Africa
Peru Brazil Indonesia

Argentina
Business Success Depends on Technology
Integration Focused on the Reservoir

Prediction Description
Geophysics

Petrophysics Geology

Reservoir

Drilling Computing

Performance Characterization
Engineering
Optimization
Subsurface Reservoirs Fundamental Principles

„ Subsurface rocks are in general saturated with fluid (usually

water).
„ Fluid occupies pores, voids, and cracks in rocks.
„ Forces (e.g. gravity, geologic stress) can cause fluids to
move when a pressure differential exists.
„ Hydrocarbon reservoirs are discrete volumes of rock that
contain fluid compounds of hydrogen, carbon, and oxygen.
A Subsurface Reservoir
Sandstone Composition Framework Grains

KF = Potassium
Feldspar

PRF = Rock Fragment

PRF KF P = Pore
CEMENT Potassium Feldspar is
Stained Yellow With a
Chemical Dye
P
Pores are Impregnated
With Blue-Dyed Epoxy
Norphlet Sandstone, Offshore Alabama, USA
Grains are About =< 0.25 mm in Diameter/Length
Porosity in Sandstone

Pore
Throat Pores Provide the
Volume to Contain
Hydrocarbon Fluids

Pore Throats Restrict

Fluid Flow

Scanning Electron Micrograph

Norphlet Formation, Offshore Alabama, USA
Reservoir Properties

What are some key characteristics and properties?

„ Depth
Reservoir Hydrocarbon Fluids

„ Subsurface fluid properties depend on hydrocarbon

chemistry and reservoir temperature and pressure (phase
and dewpoint behavior). Properties change as fluids are
brought to surface.
„ What are the different types of hydrocarbon fluids that have
economic value?
We Visualize and Analyze the Subsurface Using:

3 Dimensional Volumetric Displays

2 Dimensional Maps

2 Dimensional Cross-Sections

1 Dimensional Wellbore Data

Openhole Log Evaluation

Well Log
SP Resistivity
Whole Core

(Whole Core Photograph, Misoa

Sandstone, Venezuela)
 The
vast majority
of
exploration
and
development
wells
are drilled on
seismic
 6 00
2
4 00 Methods of Structural
2
2 00 Evaluation:
2 00
20
Structural Maps
18
00
2200 Depth (ft) below
sea level
A B
Ft A
0

Miocene to Pliocene
B
1000
K Hor
izon
2000

3000
+ +

22 00
00
K Horizon + + + +
20

240
4000
+ Basement +

2600
0
5000 + + + + +
+ + +
(modified from Lees, 1952)
Reservoir Visualization
Scales of Geological Reservoir Heterogeneity
Interwell
Well Area Well
Determined

Field Wide
From Well Logs,
Seismic Lines, 100's
Statistical m
Modeling,
etc.
1-10 km
Interwell

Reservoir 10's
Sandstone m

100's m

1-10's
Well-Bore

10-100's
m
10-100's mm
µm
Unaided Eye
Hand Lens or
Petrographic or Binocular Microscope
Scanning Electron
Microscope (modified from Weber, 1986)
The Reservoir Life Cycle
Pre-Production Build-up Plateau Decline Decommissioning

Production
Rate

Time

Potential projects: Funding Required

New projects: High capital spending

Young projects: Cash Generating

Ageing Projects: Self financing

Decommissioning:
Cash sink
Reservoir Life Cycle

1) Pre-production 2) Build-Up
– Exploration – Reservoir
– Appraisal Development
– Delineation
3) Plateau 4) Decline
– Reservoir Management – Enhanced Recovery
– Production Operations – Secondary Recovery
– Primary Recovery – Tertiary Recovery

5) Decommissioning
– Abandonment
Reservoir Life Cycle and Business Value
Stage 1: Exploration The reservoir is discovered and its contents are
just beginning to be defined and understood.
Stage 2: Delineation/Appraisal The size and extent of the reservoir are
delineated and reservoir parameters are evaluated.
Stage 3: Development The understanding of the reservoir continues to
improve and field production grows as development wells are
drilled, completed and put on stream.
Stage 4: Maturity The reservoir is well understood, production infrastructure
and facilities are optimized, and production is managed as oil is
depleted. Secondary recovery processes are utilized.
Generic IT Applications in E&P

„ Data collection, transmission, storage, and security

„ Data analysis and QC
„ Data access management and integration
„ Data processing
„ Interpretation and visualization
„ Modeling and simulation
„ Economic analysis
E&P Challenges for IT

„ Turning data and analysis into rapid decisions and actions

„ Integration and standardization of applications
„ Integration of diverse data types
„ “Smart” applications and interfaces
„ Computational capability
„ Efficient knowledge sharing and management
Origin of Reservoirs
What You Should Understand
„ Basic Concepts / Principles of Geology

„ How hydrocarbons are formed

„ Traps

„ Reservoir Properties / Characteristics

Exploration
What You Should Understand
„ Technical Requirements

„ Geological Methods

„ Seismic Principles

„ Concepts of Risk and Uncertainty

Reservoir Appraisal
What You Should Understand
„ Reserve Estimation Techniques
„ Reservoir Geology Concepts
„ Reservoir Fluid Types
„ Pressure
„ Drive/Depletion Mechanisms
„ Formation Evaluation/Logging
„ Well Testing
„ Development Planning/Economics
„ Enhanced Recovery Techniques
Reservoir Development (Drilling)
What You Should Understand
„ Drilling Equipment/Personnel
„ Contracts
„ Well Design
„ Well Drilling Process
„ Well Control
„ Pressure
„ Directional Drilling
„ Measurements done while drilling
Production Operations
What You Should Understand
„ Completion Design and Process
„ Artificial Lift
„ Formation Damage
„ Multilateral Wells
„ Injection Wells
„ Surface Facilities – Gas / Oil
„ Product Separation / Cleaning
New(er) Technologies
What You Should Be Aware Of
„ Time Lapse (4D/4C) Seismic
„ 3D Visualization – Virtual Environments
„ Intelligent Oilfield – Realtime Downhole Monitoring /
Intervention
„ Coiled Tubing Drilling
„ Multidiscipline Integration – Software / People
Subsurface Reservoirs

What are some key characteristics and properties?

„ Depth
„ Geologic Setting - Origin of Rocks/Fluids
„ Geometry – thickness, areal extent, volume, boundaries
„ Rock Type
„ Porosity
„ Permeability
„ Pressure Distribution
„ Temperature
„ Fluid Content/Distribution
„ Drive Mechanisms
„ Heterogeneity – Layering, Faults/Fractures, Compartments
„ Mechanical Strength
Reservoir Hydrocarbon Fluids

Subsurface fluid properties depend on hydrocarbon chemistry and

reservoir temperature and pressure (phase and dewpoint behavior).
Properties change as fluids are brought to surface.

Dry Gas - Gas in reservoir and at surface

Wet Gas - Gas in reservoir, gas & liquid at surface
Condensate - Gas in reservoir, light liquid at surface
Black Oil - No gas, oil viscosity/density varies
Volatile Oil - Oil Properties highly variable between reservoir and
surface