History of Reservoir Engineering


Traced to mid 1930’s

1994 Dake in ‘Practise of Reservoir Engineering.’
– ‘Reservoir Enginering shares the distinction with geology in
being one of the ‘underground sciences’ of the oil industry,
attempting to describe what occurs in the wide open spaces
of the reservoir between the sparse points of observation -
the wells’
Integration of Reservoir Engineering
Roles of the Reservoir Engineer


Contributing with geologists and
petrophysicists in estimation of oil-in-place

Determining fraction of oil-in -place that can
be recovered.

Attach a time scale to the recovery.

Day-to-day operational reservoir engineering
throughout the project lifetime.
Activities of Reservoir Engineering


Reserve Estimation

Development Planning

Production Operations Optimisation
Reserve Estimation


The reserves are the main assets of an oil
company.

Quantifying reserves and recovery factor is an
ongoing role of the reservoir engineer.

Basic data not always straightforward.

Reserves can be affected by the development
process
 Reserve Estimation


Geophysical
estimates from
seismic interpretation
Reserve Estimation


Log Analysis
estimates of porosity
and fluid saturation
 Reserve Estimation


Laboratory measurements to measure
recoverable oil
Reserve Estimating


Not exclusive to reservoir engineers

Volumetric estimates of reserves obtained at
various stages

STOIIP - stock tank oil initially in place
Optimal Development Planning


Large up front investment
Optimal Development Planning


Requires detailed understanding of the
reservoir characteristics
Optimal Development Planning


Various development options to be
considered
Production Operations Optimisation


Rarely do reservoirs perform as predicted

The reservoir engineering model has to be
updated in line with the production behaviour.
 Reservoir Engineering Techniques

Traditional reservoir engineering tools were designed
around slide rule and graph paper.

Increasingly advanced computing capability is
enabling large ‘simulations’ to be carried out
Available data

Geophysical surveys

Well logs

penetration

cuttings
– electrical
– sonic
– nuclear

Pressure data

Formation fluid content data
Tools of the Trade


Seismic maps 
Structural maps

Well logs 
Porosity maps

Sections 
Understanding the
geological model

Pressure
measurements 
Imagination.

Isopach maps
Geological model
Petroleum Reserves Definitions


Subject of study for some time.

Agreed definitions by SPE and WPC in 1996.

Recognises that not practical to have precise
classification because of different forms of
occurrence, wide characteristics, uncertainties
of geological environment, and evolution of
technologies.
Petroleum Reserves Definitions


Essential that governments and industry have
a clear assessment of quantities available and
anticipated within practical time frame through
additional field development, technological
advances, or exploration.

Important that a consistent nomenclature be
used by industry to define reserves.
Reserves Definitions


Reserves are those quantities which are
anticipated to be commercially recovered from
known accumulations from a given date
forward.

Reserve estimates involve some degree of
uncertainty.

Uncertainty depends on reliable geological and
engineering data available at the time of estimate
and its interpretation.
Reserve Uncertainty


Relative uncertainty expressed by placing
reserves into two classifications.

Proved

Unproved-less certain than proved. Further
subdived to express increasing uncertainty.

Probable

Possible
Methods of Estimation


Deterministic
– A single best estimate of reserves bases on
known geological, engineering, and economic
data.

Probabilistic
– Known geological, engineering and economic
data are used to generate a range of
estimates and their associated probabilities.
Proved Reserves


Those reserves which by analysis of
geological and engineering data , can be
estimated with reasonable accuracy to be
commercially recoverable from a given date
forward from known reservoirs and under
current economic conditions, operating
methods and government regulations.

Developed and Undeveloped
Proved Reserves


Deterministic methods
– reasonable certainty to express a high degree
of confidence that quantities will be
recovered.

Probabilistic methods
– at least 90% probability that the quantities
actually will equal or exceed the estimate.
Proved Reserves


Reserves are considered proved if
commercial producibility is supported by
actual production or formation tests.

In certain cases proved reserves may be
allocated on the basis of well logs and/or core
analysis that indicate that the reservoir is
hydrocarbon bearing and analogous to
reservoirs in the same area that are producing
or have demonstrated the ability to produce
on formation tests.
Proved Reserves

The area of the reservoir includes:

the area delineated by drilling and defined by contacts,
if any.

The undrilled portions of the reservoir that can be
reasonably judged as commercially productive on the
basis of available geological and engineering data.

If no fluid contacts, lowest occurrence of hydrocarbons
controls the proved limit unless indicated by definite
geological, engineering or performance data.
 Test 1


There are 950 MMstb of oil initially in place in a reservoir.
It is estimated that 500 MMstb can be produced. Already
100MMstb have been produced. What are the reserves?

STOIIP is: 950 500 400 MMstb

The reserves are:

450 400 500 MMstb

 Test 1


There are 950 MMstb of oil initially in place in a reservoir.
It is estimated that 500 MMstb can be produced. Already
100MMstb have been produced. What are the reserves?

STOIIP is: 950  500 x 400 x MMstb

The reserves are:

450 x 400  500 x MMstb

 Test 2

Before starting production it was estimated that there was a
90% chance of producing at least 100MMstb, 50% chance of
producing 500MMstb and 10% chance of producing
700MMstb. That is we are sure we can produce at least
100MMstb, and we will probably produce as much as
500MMstb, and we will possibly produce as much as 700
MMstb. Tick the correct answers.
Proved reserves
100 200 300 400 500 600

Probable reserves
100 200 300 400 500 600
Possible reserves
100 200 300 400 500 600
 Test 2

Before starting production it was estimated that there was a 90%
chance of producing at least 100MMstb, 50% chance of producing
500MMstb and 10% chance of producing 700MMstb. That is we are
sure we can produce at least 100MMstb, and we will probably produce
as much as 500MMstb, and we will possibly produce as much as 700
MMstb. Tick the correct answers.
Proved reserves
100  200 x 300 x 400 x 500 x 600 x

Probable reserves
100 x 200 x 300 x 400  500 x 600 x
Possible reserves
100 x 200  300 x 400 x 500 x 600 x

Proved reserves =100MMstb, Probable & Possible=500MMstb

Proved & Probable & Possible=700MMstb

Test 3


What is wrong with the following statement ?
– Reserves are those quantities which are
anticipated to be recovered from a petroleum
accumulation
Test 3


What is wrong with the following statement ?
– Reserves are those quantities which are
anticipated to be recovered from a petroleum
accumulation

Answer
– Reserves are those quantities which are
anticipated to be commercially recovered.
Economics is very important aspect
 Economics

Oil and gas price ?

Inflation?

Future economic trends?

Discount factors etc?

Answer-

The current economic conditions are the basis re;- prices
– costs
– contracts
– government regulations
 Test 4.

We have a structure in an area which we expect to explore.
We anticipate it to contain a STOIIP of 2000MMstb, and a
recovery factor of 65% using primary recovery (30%),
secondary (25%) and tertiary (10%) recovery methods.
What are the reserves?

Answer:SPE/WPC - zero. Intentions are not a basis
for reserves. No well has yet been drilled.

Some companies will allocate potential reserves for internal
use. Cannot be used for public or government figures.
Requirements for proved reserves

Maps
– from seismic and geological data.

Petrophysical logs

Well test results and rock properties from recovered
core.

Facilities
– Necessary facilities for processing and transport
either in place or will be installed as backed up by
formal contract
Contributions to the Proved Reservoir Area


This comes from the drilled and produced
hydrocarbons

the definition of the gas and oil and water
contacts

or the highest and lowest observed level of
hydrocarbons.

Also the undrilled area adjacent to the drilled can
be used.
Test 5

A reservoir has been discovered by drilling a
successful exploration well, and drilling a
number of producing wells. We have even
produced some 200 MMstb of oil.

STOIIP = 2000MMstb Recovery factor=35%

What are the reserves?
 Test 5

We have even produced some 200 MMstb of oil.

STOIIP = 2000MMstb Recovery factor=35%

What are the reserves?

Answer:-
– Ultimate recovery =2000x0.35=700MMstb
– Minius production to date= 200MMstb
– Reserves = 500MMstb

Reserves are those anticipated to be commercially recovered from a
known accumulation from a given date forward
Reserves - progression with time
Proved reserves


Reserves from other locations proved under
developed provided where geological and
engineering data from wells indicate objective
formation is laterally continuous and contains
commercially recoverable at locations beyond
direct offset wells.
 Reserves

Reserves can be attributed to natural energy or
improved recovery methods.

Improved recovery methods
– all methods for supplementing natural energy or
altering natural forces in the reservoir to increase
ultimate recovery.
– Examples: pressure maintenance, gas cycling,
waterflooding, thermal methods, chemical flooding,
and the use of miscible and immiscible
displacement fluids
Unrecovered oil


What are the amounts termed which are not
recovered?

The amount that remains in the reservoir are
called:

remaining hydrocarbons in place.

NOT Remaining Reserves !
 Proved reserves

Reserves produced using established improved recovery
methods when:

successful results from pilot project or favourable response in the same
or analogous reservoir with similar rock & fluid properties.

Reasonable certain project will proceed .

From IOR methods yet to be established provided:

favourable production response from subject reservoir
 from pilot
 installed programmes with response as planned

reasonably certain project will proceed
Unproved Reserves

Based on geological and/or engineering data
similar to proved reserves but technical,
contractual, economic, or regulatory
uncertainties preclude being classified as
proved.

Further classified as:

Probable

Possible
Unproved Reserves -Probable


Are those unproved reserves which geological
and engineering data suggest are more likely
to be recovered than not to be recovered.

For probabilistic methods, should be at least
50% probability that quantities recovered will
equal or exceed estimate of proved plus
probable reserves.
Unproved Probable Reserves - may include:

Reserves anticipated to be proved by step-out drilling but
where sub-surface control is inadequate to classify as proved.

Appear productivity based on well log characteristics but lack
core data or definite tests and are not analagous tp producing
or proved reservoirs in the area.

Incremental reserves attributable to infill drilling at closer
spacing than approved.

IOR reserves when:

project pilot planned

rock, fluid and reservoir characteristics favourable
Unproved Probable Reserves - may include:


Reserves in area of formation separated from the
proved area by faulting and geological interpretation is
structurally higher.

Reserves attributable to a future workover, treatment,
re-treatment, change of equipment, or other mechanical
procedures, where such procedures have not proved
successful in wells which exhibit analogous reservoirs.

Incremental reserves in proved reservoirs where
alternative interpretation of performance or volumetric
data indicates more reserves than proved.
Unproved Possible Reserves


Are those reserves which geological and
engineering data suggest are less likely than
not to be recovered than probable reserves.

For probabilistic methods, should be at least
10% probability that quantities recovered will
equal or exceed estimate of proved plus
probable plus possible reserves.
 Unproved Possible Reserves -may include

Those based on geological interpretations which could possibly exist
beyond areas classified as probable

Those based on core and log analysis but may not be productive at
commercial rates

Those attributed to infill drilling, but subject to technical uncertainty

From IOR methods
 project or pilot but not operational
 rock fluid and reservoir characteristics such that reasonable doubt for
commerciality of project.

Reserves in area of formation separated from the proved area by faulting
and geological interpretation is structurally lower than proved area
Reserve Status Categories- Developed


Developed reserves are expected to be
recovered from existing wells.

IOR reserves are considered developed only
after equipment installed or when costs to do
so are relatively minor.

Sub-categorised as:
– producing or non-producing
 Reserve Status Categories -Developed

Producing

Those expected to be recovered from completion intervals which are
open and producing.

IOR reserves only after project is in operation

Non producing

Shut in and behind pipe reserves

from completions open but not started production

shut in for market conditions or pipeline connections

wells not capable because of mechanical reasons
Reserve Status Categories -Undeveloped


Expected to be recovered from:

new wells on undrilled acreage.

deepening existing wells to a different reservoir.

large expenditure is required.

recomplete an existing well

install production or transport facilities for primary or IOR
projects
Probabilistic Representation of Reserves


In the deterministic approach volumes are
determined by calculation of values
determined for the various parameters.

With the probabilistic approach statistical
analysis is used. e.g. Monte Carlo methods
Probabilistic Representation of Reserves

Proven - 90% probability

Probable - difference
between 50 & 90%

Possible - difference between
10 & 50%
 Probabilistic Representation of Reserves

Some measure of subjectivity. For each element there is a
probability function.
Probabilistic Representation of Reserves


Proven = 500MMstb,

Probable =740-500=240MMstb

Possible =860-740=120MMstb
Probabilistic Representation of Reserves

As field is produced the shape of the curve changes. Probability
converted to recovery leaving less uncertainty in reserves.
Volume in-place calculations

Volume of oil and gas in-place, V, depends on:

aerial coverage of reservoir , A.
 Thickness of the reservoir, hn.

Pore volume, expressed by porosity,

Proportion of pore space occupied by hydrocarbon, (
the saturation ), 1-Sw

V=Ah n (1  Sw )
When expressed as stock tank volumes
equation divided by Bo or Bg

V=Ah n (1  Sw ) / Bo
Volume in-place calculations & Reserves
STOIIP=V=Ah n (1  Sw ) / Bo

Reserves = STOIIP  R F x

Where RF is the recovery factor

A - will vary according to category:

proven
probable
possible
 Evolution of the reserve estimate

Suggest this location

Evolution of the reserve estimate
Evolution of the reserve estimate

Proved
Probable Probable
Possible Possible
Evolution of the reserve estimate
Evolution of the reserve estimate
Evolution of the reserve estimate
 Evolution of the reserve estimate
Deterministic perspective as indicated by top structure map
 Reservoir Area

Areal Section

Lines of

Cross Section

Lines of constant subsea depth

 Example - Rough Field UK

Schematic Cross Section of

Rough Gas Field

Lines of

Top structure map of Rough Gas Field

 Reservoir Thickness
Area contour maps which show
thickness normal to the plane of the reservoir are called
isopachs
When the thickness is mapped as vertical thickness is termed
isochore
Those contours which include non-productive material are called
gross reservoir isopach
Where non-productive material is excluded are called
net reservoir isopach map
The intervals contributing to flow are termed
pay
 Reservoir Thickness

Rough Field Isopach

Lines of

Net Pay Thickness Isopach

Hydrocarbon volume from net pay thickness

Lines of
 Reservoir Porosity
m
Average porosity in a well can be
calculated from the thickness-weighted
 h k n,k

mean of the porosities w  k=1

hn

of Rough Field Iso Porosity Map

Lines

Iso Porosity Map

 Water Saturation
Average water saturation can be determined by calculating the
volume weighted mean across the producing elements of the
formation

m Iso Saturation Map

S w.k  h n,k
Sw,w  k 1
w h n
Lines
Formation Volume Factors Oil,Bo and Gas, Bg

Formation volume factors convert reservoir volumes
to surface volumes.

They do not vary significantly across the reservoir
compared to other rock related properties.

In some reservoirs there is a compositional gradient
which results in variations in the oil formation
volume factor

In this case average or values measured at depth
would be preferred
 Recovery Factor

Proportion of hydrocarbons recovered called recovery
factor.

Influenced by a range of properties.

Rock and fluid properties.

Drive mechanisms.

Formation characteristics & heterogeneity

Development process

Geometry and location of wells
Log - probability
Residual Oil
Saturation for
Water Drive and
Solution Gas
Drive (API)
Log - Probablity
of Oil Recovery
For Various
Drive
Mechanisms.
(API)
 Production Capability

Isocapacity signifies
production capability.
Isocapacity Map

Denotes equal values of
permeability-nett
thickness product

Can be mapped instead
of permeability

Lines
 Permeability Map

Lines

Rough Field Permeability Map

 Hydrocarbon Pore Volume Map
Hydrocarbon pore volume obtained by combining net rock
volume with mean porosity and a mean hydrocarbon saturation.
Alternative mapping hydrocarbon thickness,HPT at each well.

HPT= h n Sh

Sh  1  Sw Lines
Rough Field Hydrocarbon Pore Thickness Map

Lines
Other Appraisal Tool - Production Test


One of the moat powerful tools for reservoir
engineer.

Used to evaluate the characteristics of the
reservoir under realistic conditions.

Exploration well is turned temporally into a
producing well and downhole pressure
recorded.
 Production test - Well Test

Key aspects >

Producing interval

Downhole pressure
monitoring
Lines

Oil & Gas Flowrates

 Well Test
2 rate test
Initial downhole
pressure
Pressure declines
in relation to flow 1

Pressure declines
in relation to increased
flow 2

Well shut in
and pressure
builds up
Draw down and
build up curves
analysed to give kh
 Other Appraisal Tools

Nature of the Fluids - PVT

important for reservoir behaviour and processing.

Pressure profile in a well.

powerful measurements to aid in reservoir structure and
dynamic continuity.

Core analysis

a cross check for downhole measurements and unique
measurements.
 Development Planning

An evaluation of alternative plans

Well data and Test Results

Reservoir maps

Material Balance

Drive mechanisms

Reservoir models

Techno economics

Land developments higher degree of flexibility

Offshore developments limited flexibility after production system ordered
Reservoir maps
An evaluation of alternative plans
 Development Planning


Drive mechanisms

Simple and complex models

Displacement models for injection processes

Recently, integration of geological and
geophysical perspectives providing greater
confidence in simulation models
 Drive mechanisms

Water Drive Gas Drive

1 1
1

2
2

3
3
Development Planning


Production profiles

oil, gas and water

Well requirements

Topside facilities
 Uncertainty

Reducing uncertainty is the key issue of the
decade and not least in reservoir engineering and
its related disciplines.

More information gives less uncertainty.

Collecting data costs money

Greater cost the delay on the project.

Tension between reservoir engineers and project
engineers.
Uncertainty - Reservoir


Static properties

Reservoir structure

Reservoir properties, k, h etc

Reservoir connectivity

Impact of faults

‘thief’ sands
 Uncertainty - Reservoir


Dynamic properties

Relative permeabilities etc.

Fluid properties

Aquifer behaviour

Well productivity ( fractures, well type, condensate
drop-out etc.
Uncertainty - Reservoir
 Material Balance Equation

Pi
Production

Water Influx

Pt
Material Balance Equation

Examines the pressure -volume behaviour of an entire
field

Tank model of the reservoiur

Engineer fits a simple model to the data and predicts
future performance

Model gets updated to match production -history
matching.

Reservoir simulation models comprise many aspects
of material balance
 Material Balance Equation
N p  Bt  Bg  R si  R p    Wp  C
B  B  Bg  Bgi  Sw c w  c f 
NBti  t ti
 m    1 m p   We
 Bti  Bgi  1-Sw 
 
Known : Production data Np, Rp, Wp
HISTORY MATCHING Hydrocarbon Properties Bt, Bti, Bg, Bgi
Reservoir Properties Sw, cw, cf, m
Pressure drop p
Unknown : Reserves N
Water Influx We

PREDICTION Known : Reserves,Water influx, Hydrocarbon properties,

Reservoir properties.

Unknown : Oil & Gas production as a function of pressure drop

Production Operations Optimisation

The development phase

covers period from continuous production to abandonment.

When to stop a techno-economic descision.

Best reservoir engineering data during production stage.

Through production the reservoir yields its secrets.

Hydrodynamic continuity revealed by post production
pressure surveys.

Rise of fluid contacts needs monitoring
 History Matching

Throughout production the comparison of the actual
performance with that predicted during appraisal stage is
monitored. It is during this stage that the reservoir
simulation model is under examination.

History Matching. - The update of the model to fit
actual performance.

Clearly a model that cannot predict the past is no good for
predicting the future!

Computing power is enabling integration of geological input
with physics of flow etc. - Integrated reservoir simulation.
Production Operations Optimisation


Good production records required.

History Matching
– The update of the model in line with actual
performance

Reservoir simulation success depends on
detail of reservoir description and complexity
of reservoir.
Reserve Estimating


When production data available reserves
estimates can be refined.

Historically
– Decline curve analysis
– Material Balance Equation

Computer based reservoir simulation
 Decline curve analysis


Plots of production rate versus time, or
production, on a variety of co-ordinate scales

Straight line is considered to characterise
behaviour and is extrapolated to predict future
performance.
 Phases of Development

During development a number of phases

the build up phase
– with predilling may not happen

the plateau phase
– the reservoir is producing at design
capacity for the facilities.

The decline phase
– the reservoir no longer able to
produce at capacity.
– Plateau phase can be extended, eg
use of artificial lift, downhole pumps
or gas lift.

Economic limit - will vary

according to project type
and size
 Improving Recovery
Three phases of recovery

Primary recovery
– recovery obtained through natural energy of the reservoir

Secondary Recovery
– energy is supplemented by injection of fluids, gas or water.
To maintain or partially maintain pressure.
– Two types of oil left.
– High saturation in unswept part- by passed oil
– Lower saturation in swept part - residual oil saturation

Enhanced oil recovery, EOR.
– The target for by-passed and residual oil
 Enhanced or Tertiary Recovery
Improved Oil Recovery,
IOR -
covers all approaches to
improve hydrocarbon
recovery
The Uniqueness of the Reservoir

Reservoir Behaviour

Early agreement to
reservoir description
Reservoir Development speeds development
Plan

Unique & Static

Dynamic
Reservoir Description
Leman Gas Field UK after first exploration well
Leman Gas Field UK 10years after first exploration well
 Reservoir Engineering


A broad fundamental background of basic
sciences and engineering.

The behaviour of the reservoir rocks.

The properties of the contained fluids

Fluid through through reservoir rocks

Reservoir drive mechanisms
How things have changed !!