 | The Bullroarer - Thursday 6 December 2007 | TOD: Australia/New Zealand | Charts of the Day - Sunday 9th December 2007 |  |
Shedding Light on the Question of Reserves Growth
Posted by Phil Hart on December 7, 2007 - 11:30am in TOD: Australia/New Zealand
Topic: Geology/Exploration
Tags: reserves, reserves growth [list all tags]
USGS World Petroleum Assessment
In 2000, the United States Geological Survey issued its World Petroleum Assessment, covering the thirty year period 1995-2025 (Table 1). The resource estimates from this study are widely quoted to support the argument that oil production can continue to expand. (Comments now open!)
Conventional oil and NGLs
In assessing the world's total oil endowment to be over 3 trillion barrels, the USGS study defines a huge contribution of 730 billion barrels with the 'potential to be added' to world reserves over the period 1995-2025 as a result of increases in the amount of oil that can be extracted from existing fields. The complete Reserves Growth report (Chapter RG) from the World Petroleum Assessment is available through the USGS website.
It should be noted, that while the USGS total estimate is likely high in each of the three areas assessed, a total endowment of 3.3 trillion barrels is insufficient to enable production to continue growing at historical rates beyond 2020. Forecasts for peak oil occurring much beyond 2020 imply even more unlikely resource estimates.
USGS Methodology
In assessing the potential for reserve growth to increase world resource estimates, the USGS studied apparent field size increases over time in the mature oil producing regions of the United States and applied the observed growth to worldwide remaining reserves and cumulative production, resulting in an average increase of 44%. A flow chart illustrating the process the USGS used is shown in figure 1.
Figure 1: Flow Chart for the USGS Reserves Growth Assessment Methodology.
Secondly, the manner in which oil fields are developed now bears no comparison to the early days of the US industry and leaves a lot less to gain. This difference has arisen largely because North American (USA and Canada) mineral rights are vested in the landowner, while almost everywhere else in the world they are vested in the Government.
Since the 1970's, and in contrast to early North American experience, new fields have generally been unitized and fully delineated. This means that the joint field owners are allocated a percentage share in the field based on how much of the field lies within their acreage. Costs and subsequent revenue are apportioned between the owners, enabling agreement on upfront capital costs for appropriate development. The result is that secondary recovery is now generally in place where appropriate from day one.
Figure 2: The forest of drilling rigs that occurs when owners of small pockets of land have the mineral rights and compete against each other to extract oil from a field as quickly and cheaply as possible.
As a result of this fundamental difference in ownership and approach it is quite inappropriate to apply the reserve growth experience from North America to non-North American reserves. Development of deep water and smaller fields has only strengthened this trend towards optimized recovery from early in field life. Consequently, there has been relatively little reserves growth observed in offshore producing areas in the last decade.
A New Reserves Growth Methodology
The USGS used a plot function that defined reserves growth as a function of the age of the field. However, largely because of the errors described above, the function is much too optimistic when applied to the rest of the world.
Figure 3: Graphical representation of typical recovery factors (chart from Industry Technology Facilitator, owned by 18 UK North Sea operators).
Rather than applying a growth function simply as a factor of age, we can consider categories of fields according to their current development status. For each category we can estimate the maturity of the current 'proven plus probable' reserves estimate and the scope for further gains:
- For fields that are not yet developed or that are using primary recovery only, the scope for reserves growth is large. However, there are relatively few fields in these two categories.
- For the large fraction of fields where secondary recovery facilities are in operation, or strong natural aquifer pressure support is present, future reserves increments are the additional contribution that could be achieved by tertiary recovery only.
- For fields where tertiary recovery mechanisms are already operating, the recovery gains expected from those facilities will be included in current reserves estimate. The prospects for further reserve growth in this category are limited.
- For fields at or near the end of their producing lives, especially those decommissioned or de-pressurized in a switch to gas production, there is little scope for reserves growth. While isolated fields may be successfully redeveloped, the average increase in reserves will be low.
- For gas/condensate fields, confidence in ultimate liquid production is somewhat higher and possibilities for enhanced recovery are generally limited to lowering wellhead pressures.
Conventional crude oil, condensate and NGLs (billion barrels)
Revision: 29th Nov 2007
Click to enlarge
- (a) Primary recovery is often used for initial field production, with pressure maintenance applied once sufficient field experience has been accumulated. Effectively, most fields move from primary recovery to secondary recovery (where required) within a few years of start-up.
- (b) This category includes fields where aquifer support achieves strong pressure maintenance, eg. Burgan, Kuwait.
- (c) Gas/condensate fields are assumed to have potential liquids reserves growth of 10% on average and are therefore included in the same category as fields with secondary recovery. Clearly the total figure here of 220 billion barrels has limited potential to delay peak oil, compared to the more significant 730 billion barrels suggested by the USGS. The weight that other commentators have given to 'reserves growth' in meeting future production needs implies even higher figures which seem unrealistic.
- Gb : Giga (billion) barrels.
- NGLs: Natural Gas Liquids.
- Unless otherwise stated, reserves here refer to P50 estimates, ie. proven plus probable. Also referred to as 2P, these are 'best' estimates, which are just as likely to be exceeded as not. P90 (3P) 'proven' reserve estimates are those which have a 90% chance of being exceeded. P10 (1P) 'possible' estimates have only a 10% chance of being exceeded.
The estimates presented in Table 2 are necessarily approximate but dramatically improve on the simple and inappropriate extrapolation used by the USGS. Input to refine the figures is welcome; both in terms of the growth possible in each category and the volume of reserves allocated to each category.
As a final note, the USGS estimate of 730 billion barrels of reserve growth over the thirty year study period describes an annual reserves increase of 2.5%. Internal company estimates of annual growth in field reserves are closer to 0.2%. The USGS result is ten times higher than that used within the industry and must be called into question. I hope that this post provides new methodology for which the contribution to be made by reserves growth can be estimated.
http://science.reddit.com/info/62emx/comments/
thanks for your support...
Excellent concise article Phil. Mahalo.
This has always been the big if in the petroleum business. How much is there and how much is it going to cost to get it out of the ground.
Very funny, these USGS people.
One has to ask: In an environment where so much money is to be made using "reserve growth," why hasn't it happened already?
It would seem that right now would be the easiest point to grow reserves while they are relatively easy to get at, not when they get really hard to extract.
The USGS argument falls flat. There will not be a sudden boom in extraction technology that will allow us to scrub every pore in the pay zone. What they fail to recognize is that it requires energy to push, pull, heat, or freeze. All of the slack in inefficient technologies has been pulled taut over the past forty years. Throwing energy at the problem is self-defeating.
I would guess that the USGS will continue to be the equivalent of the "propaganda bureau for continued corporate happiness" until the truth has been beating the average corporate slave over the head for several years.
By that point, it will be too late to mitigate anything. All of the people who have been urging "caution," to "go-slow," to avoid "looking like a nut" will have won. What will they have won? Well, immense human suffering that could have been avoided. A destroyed, polluted, degraded world. And a society that will undoubtedly be as fragmented and lonely as it ever was.
They will have won for the short-sighted, greedy, me-first corporations the last squeezings from the dying hearts of our people and our environment. Of course, the black-hearted corporatists will head for the hills and attempt to live in their gated, broken glass-topped walled compounds with Blackwater standing watch outside those gates.
Unfortunately for them, the earth will still be a sphere and the effects of their greed will still be felt by them.
Thank Gaia for that.
Yes.
What Cherenkov said.
Gaia is self-regulating.
The honorable Professor Lovelock is not to be disregarded. On the contrary.
Shh! Cherenkov, you will wake the sleeping and brain dead.
Think on the lemmings migrating to pastures new, think of a Cherenkov lemming shouting "the bridge to Avalon is out my comrades, death is near and will be of a rate 90% inclusive". They would mill and stomp about eating the last leaves of grass in great despondency, all to be lost to pasture degradation and slow starvation, 100% inclusive.
So shhh Chenekov, go quietly and gather those like-minded and whisper softly in their ears "Hey guys lets go for beer the (-------) end is near".
I'm a believer in the report. After all this is a government that lies about the inflation rate, manipulates the mass media on a routine basis, lies to get us into war(s), run by a president that god talks to, etc. What's there not to believe?
Opinion on EIA and IEA data? Perhaps there's no terra firma.
I'll just point out one, very obvious thing.
The reserve growth result is highly dependent on the expected increase from secondary recovery fields. If 10%(a nice round number...) were actually 8% it would result in a reserve growth of less than 200Gb. Taking Ghawar as the stated example, is there really the scope for tertiary recovery to yield an extra ~12Gb from the field? How does 10% stack up on a sanity check?
Putting a degree of extra precision on that 10% number would be worth the effort.
agreed. any ideas about how to do that?
i think a 10% increase in recovery after efficient secondary mechanisms have been exhausted is probably optimistic.
From a peak oil perspective its probably irrelevant. Your not getting high production rates out of this sort of extraction.
We tend to equate reserves with a certain assumed production rate but thats far from the truth. Once your past secondary recovery its not all that interesting. Theoretically we will be extracting over 20mbpd for a very very long time but who cares ?
On a small part of the oil extracted using secondary mechanisms will be extracted while we still have high production rates from primary and secondary recovery. All that matters is what are the reserves recoverable by primary and secondary recovery. I think you will find that we are down to a few 100GB of oil in this class and it makes up over 60% of our production. I could care less about the remaining 40% of or less of oil produced via secondary recovery. Its not clear how much of this will be extracted nor who and how it will be used once oil is no longer useful as a cheap commodity.
Phil,
Thanks for writing and posting this important article. "Reserve Growth" is one of the key parameters that distinguish ASPO projections of future oil reserve size (and therefore, production, which is what the world actually uses) with those of the optimists like CERA and EIA. EIA of course takes their data from USGS.
I'm wondering about a detail: the report was issued in 2000, covering the 1995-2025 period - so is it correct that they used no data available from 1995 to 2000 to calibrate their projections? Did they, in effect, pretend it was 1995 and then project forward their calculations for 30 years?
One important aspect included in Table 1 is "Undiscovered Reserves". This is another key parameter where USGS methodology is over-optimistic and vulnerable. If you assume (unrealistically) a flat rate of discovery, and spread out those 939 billion to-be-discovered barrels over the 30-year forecast period, you will find we should be discovering 31 billion barrels per year. And of course the reality is that we're finding only a fraction of that - maybe 6 billion per year (somebody confirm this?)
Of course, a flat rate of discovery over 30 years is not realistic, given the natural reduction in discovery prospects over the 30-year period. If we make the reasonable assumption that discovery rates might be reduced by 50% over the 30-year projection, then the interval must begin in year 2000 with discovery at over 40 billion barrels per year, declining to 20 billion by 2025. Based on the same assumptions you will find we should have discovered, cumulatively, 263B barrels in the period from 2000 to 2007. So, how close to that 263B barrels have we found in the 2000 to 2007 period so far? Not even close! (I would love to see another TOD article addressing this, with more detail and better numbers).
This is a key element of the ASPO peak oil forecast, since (as Colin is so fond of saying) you can't produce what you don't discover. This is why (with reserve non-growth, plus depletion rates) peak will almost certainly be within 4 or 5 years, not in 2030 or 2037 or beyond.
When you combine Phil's assessment of Reserve Growth (subtract 510B bbl) with realistic estimates of future discovery (subtract XXX billion barrels) and the overstated ME reserve sizes (subtract 300B bbl) you are down at least 1 trillion barrels from the USGS projections of total petroleum endowment. For something this important, it's astonishing how wrong they are, and how uncritically most of the world has accepted their numbers as gospel. This fact, 7 years into my energy education, still amazes me.
One would hope that 7 years into their 25-year forecast (starting in 2000) - that's almost 30% of the period - real data on reserve growth and new discovery would have made it very obvious how over-optimistic their forecasts are, which should cast severe doubt on the validity of their projections going forward.
I believe the IEA has, in fact, decided to review their use of USGS numbers and by now has been hit over the head by a 2x4 (insert metric numbers here) enough times to see how reality is diverging severely from USGS and EIA projections. It's about time. You can only "make your own reality" for so long and get away with it.
Dick Lawrence
ASPO-USA
thanks Dick. there is a similar correction required to reserves and discovery numbers.
i'll try and post a second part to this which pulls together the total numbers you are talking about.
if you want a sneak preview, my estimate of discovery and reserves is in this paper which was presented at the Australasian Transport Research Forum earlier this year:
http://philhart.com/fileshare/files/101/TheOilDrum_ANZ/atrf/RP_Hart_82_T...
One big issue your missing is that Shell has revised its reserve estimates downward by over 50% in multiple revisions.
I can't imagine that Shell's reporting behavior and metrics differed that significantly from the rest of the industry. Given that employee's in a given field especially in the higher ranks often work for several of the large companies in a area. The chances that Shell approach to determining reserves was that badly off of industry standard is slim to none.
Next and more directly how much of the current reserves are true new discoveries ?
We discovered close to a trillion barrels of oil by 1980 and mega fields made up a fair amount of these discoveries. I question that you can discover 800GB of oil with only one giant field being discovered ? No more super giants in all those discoveries and in fact no pretty much no really large fields discovered since the 1980's ?
I think you will find the majority of these 800GB consist of backdated discovery yet even with one of the last major oil fields discovered Purdhoe Bay we had a original estimate of 10GB and a final production of probably 13GB. With the last 3GB coming out at a greatly reduced production rate.
So for now at least to be conservative we should discount 400GB of the 800GB until we have better transparency. Shell shows we cannot take these numbers on faith.
This leaves 400GB. And new we have to question how fast we can extract this 400GB how much of that is going to be extracted close to our present rate ?
Again to be conservative we say well maybe 200GB before we see a significant decline in extraction rates.
Well guess what we extract 30GB or so a year so at best 10 years before we see serious problems.
And now your at the level I'm at is it 200 or close to 100. I think its somewhere in this range. The reason I lean toward closer to 100GB is simple because Hubbert came up with a global estimate of 1250GB and he was right in his first prediction. When he did his global analysis because of the political economic climate he simply did not have access to the quality of data that he had to make his original US prediction. If anything he probably erred on the high side.
http://www.touchbriefings.com/pdf/2590/Ferro.pdf
This indicates we are at least 80% depleted based on water cut right now.
Given all this yes we may still have a significant amount of oil to extract but the chances we can extract that oil at anything close to the 80mbd+ that we do now are in my opinion slim to none. Can we do it at 40mbpd sure but that does not support our society.
So in closing using oil as a cheap energy source for powering our society is probably in its last few years.
And even the 2 trillion number is suspect once you divide it out into new production and production under secondary recovery that provides high production rates which is gas injection or water drive.
And second its probably that reserve estimates by the Major Oil companies are also highly inflated I just don't believe that Shell is the only company that has overstated reserves.
So if you focus in on how much oil that can be extracted at high production rates the situation is even grimmer.
So until otherwise I think this is the real breakdown.
100-250 GB of "easy oil"
200-250 GB of oil extractable at a slow rate with advanced recovery.
500-700GB of paper reserves that probably simply don't exist.
Given that Shell has written down reserves by over 50% multiple times we have no reason to assume they are down and that other Oil companies won't be forced to follow suite.
As far as extraction rates who knows. I happen to think that we will see steep declines effectively now. If its 100GB of easy oil left you have to imagine that overall production rates have to start dropping sharply. If its 250GB then we have 3-4 years. But in my opinion if we did have 250GB of easy oil left we would not have hit peak production now but should have continued to climb slowly into 2010-2011.
Given that we have had high priced oil for years one would think that market forces would have resulted in continued production increases if we had 250+ barrels of oil left.
Its only when you pull the number back down near 100GB that it makes sense that strong market forces and advanced technology cannot overcome depletion higher estimates imply that we have room to increase.
Dick, the USGS has, in about the first paragraph of the executive summary of the 2000 World Assessment, the following description of what their numbers are...and I quote...."potential to be added to existing reserves".
They don't say..."for a given discovery profile", or "for a flat discovery profile", they say POTENTIAL, which strikes me as a hedge against ever seeing the entire amount mentioned, for WHATEVER reason.
Within potential I imagine economics comes into play, if everyone is driving EV's and there is not much demand for crude, there won't be much of an incentive to discover ANYTHING, let alone an imaginary profile within a given timeframe.
Also, the USGS numbers don't come anywhere close to a "total petroleum endowment", no way, no how. They specifically excluded all unconventional plays during their assessments ( at the World level anyway ). That small fact means that their numbers are guarenteed to be low. Not optimistic, or high, but when talking about global endowment, low.
As usual this seems to fit into the style of politically expedient pronouncements instead of sound technical judgments.
I suppose the POTENTIAL was there in the 1850's for the passenger pigeon population to continue on indefinitely, yet it didn't turn out that way.
Too bad I have to phrase it that way, but no way, no how, would I want to see this discussion fall into some safe expedient realm where you never look at the worst-case scenario.
I suppose the POTENTIAL was there in the 1850's for the passenger pigeon population to continue on indefinitely, yet it didn't turn out that way.
Quite right. And I imagine the history of oil will be different in the future than we can imagine today as well. Like...we won't use as much, and alot of what is in the ground will forever remain in the ground.
Quick questions.
Does this take into account the suggestion by Russia that the Arctic has some 100BB or more?
Also, how much is off the east seaboard that is considered at present off limits?
I suspect neither would add to much to the reserves, as it's the level of output that is more important that what's in the ground.
Richard Wakefield
your points relate to new discovery, not reserves growth, so they are counted in those categories.
the usgs discovery numbers are way optimistic, even allowing for realistic artic discovery levels.
That's what I thought. Seems the CEO of Shell knows how much is off the eastern coast, I've never seen any numbers, any ideas how much is out there and how accessable it is?
I have my doubts about the high Arctic, the mid atlantic ridge runs right through the pole. Makes one wonder if there is any meanful amount of oil up there at all.
Richard Wakefield
There is probably some off the Florida coast. Now that the Democrats are taking over, the Republican rich that control Florida politics are going to lose power and the Democrats will wind up offering it for lease to pay for medikid or something in 2008.
There doesn't seem to be anything off the rest of the East Coast, but there is almost certainly a lot off the California coast in the south, again in Republican areas where the rich people don't want oil slicks. But there are also a lot of ecofreaks there that don't want drilling and oil slicks on their beaches. The Democrats will win control of California in the next election and may allow that to be open for development in 2008.
I'd like to open ANWR and see if there is anything there. It's possible that the oil fields might be there and developable. I'm more worried about short term balance of payments problems than medium term peak oil.
Damn those ecofreaks keeping us from having oil slicks on our beaches. What's the matter with them? California's coast will be open for drilling when Hell freezes over whether the Democrats win control or not.
Nah, we'll drill off the beaches when gas rationing cuts in and even the rich get with the program. Nothing like having to wait for a bus to get your priorities right...
ANWR seems to have been surreptitiously investigated. By Shell according to rumors. They seems to believe there is somewhere between 10 to 15 billion barrels. Best 'safe' guess 11 billion barrels.
It has been estimated that peak flow from the area after full development should be in the neighborhood of 800,000 bpd, maybe even 1 million bpd. Roughly 1/20th of present daily U.S. demand.
It appears to me that the now forbidden off shore areas and ANWR are being 'kept in the back pocket' for later in the game.
We need to hold use of ANWR and the coastal oil back for after the point where the public realizes that Peak Oil has happened. During the decline period any fields that haven't yet been developed will reduce the pain from the production decline.
Or if your KSA wait until everyone is in decline and Arab Heavy fetches a premium price.
Two can play this game.
I guess the question would be, if we hold back on development and Simmons is right that rigs are rusting away, will there be time, money and resources to build platforms in these areas?
I would think so jr. The powers behind the throne are gaming this as best they can and there is just no way that these volumes won't make it into the system at some point. The question would seem to be what do THEY consider the appropriate circumstances to open these areas up?
We reached the 84 million bpd production neighborhood sporadically in 2004 after a serious surge in output. To my way of thinking we have been on the plateau now for roughly 3 years, if numbers from IEA, BP, etc. are to be trusted.
Initially, I did not believe that output could hold at this level for this long. I told myself that it would all happen in slow motion, the quantities are huge and even at these production rates change takes time to take effect. But 3 years?
Total output should start slipping soon, but that is a relative term and things happen slowly in the oil business. I think that all the players are doing their damndest to stave off the first hint of real slippage. It will totally change the tenor of the situation. When it does occur there will doubtless be no end of claims of purposefully lowering output due to demand drops from switching to alternative fuels, conservation efforts, etc.
To my mind the pricing we are seeing now is at least partly attributable to the players feeling out what the market can take, and what it will take to cause demand to lower in a manageable way.
This year was a perfect case in point for this premise. Consider last Spring: volumes were already at the effective limit of production going into May, so what to do to keep a lid on things? Crank the product price to keep stocks at acceptable levels. For that period $3.50 or so seemed to be what was needed to keep a handle on throughput going into the summer driving season. All kinds of things were trotted out to explain this, Refinery Capacity being the main culprit this time around. Most people bought into it just fine, it was handled very well by TPTB I thought.
The price gradually settled back down quite a bit from the highs, farther than I thought it would, as crude continues to go up. At this point the refiners have to bite the bullet on margins a bit in order to keep throughput at the most profitable levels. But then again, vertically integrated companies are still cleaning up hugely on the crude volumes they obtain from their own production efforts.
This Fall it hasn't taken near as high a product price to keep volumes under control, quite interesting to consider.
I am beginning to believe that the dip off the plateau just won't be as catastrophic as some do. Wishful thinking? I try not to let it be.
There is so much waste in the system, at least here in the U.S., that we can probably weather a fairly steep dip in output without the wheels coming off for some time. The kicker of course being that production dips will be permanent. Change will occur, weather we like them or not.
How much will output dip before TPTB open up the off shore areas and ANWR? I have no idea. Just before the pressure becomes unbearable I would think. The later the better- 20 billion barrels of oil makes a bigger difference when total output is 50 million bpd than when it is 85 million bpd.
A lot of things need to get done, but things ARE starting to get done. Wind and solar are receiving a lot of effort now, some big money is being thrown at them. Pickens has been extremely public about his wind efforts and other big boys have sat up and taken notice.
Big money getting thrown at fusion. Yea, possible return on efforts are on a very distant horizon, but at least the effort is being made.
Thank goodness ethanol's limitations are getting more publicity finally. If we can just get Congress to act appropriately now, sheesh...
The winds of change have begun. I try not to get impatient, this is a huge ship and takes a fair amount of room to change course.
Also, I don't believe the statement "For the large fraction of fields where secondary recovery facilities are in operation, or strong natural aquifer pressure support is present, future reserves increments are the additional contribution that could be achieved by tertiary recovery only." is correct. Firstly, if the field has multiple reservoirs or compartments, not all may be initially drilled and so estimates for the other reservoirs may grow over time. Secondly, there are other reasons why reserves may have grown in fields under secondary recovery. For example, horizontal drilling and geosteering may allow exploitation of strata that were too low in permeability to meaningfully contribute to a vertical well, but can contribute to a horizontal well. Also, there are cases of fields were zones were initially thought too wet to contribute, but it turned out that much of the water was in microporosity and so in fact those parts of the reservoir could contribute.
Only the cases of a reservoir that cannot be economically produced without horizontal wells can potentially add a significant increment of new reserves. In most of the other cases if they where really adding significant increments then we would see a more symmetric production profile for our fields. This in general does not seem to be the case.
We do know that horizontal drilling allows you too keep the production rate high and water cut low at the expense of faster depletion. Its not clear that the oil industry has correctly accounted for this in both reserve estimates and in expected production lifetimes. In fact almost all public estimates of estimated reserves and production lifetimes have turned out to be highly optimistic. The North Sea, Deep Water GOM. The reliability of government oil companies if they publish data at all is highly suspect. They have little or no incentive to provide realistic projections.
The underlying problem is pretty simple extraction methods cannot change the fractional flow characteristics of a reservoir only in a small number of cases of tight porosity does the extraction method physically matter. You have a lot of room to increase production rates but very little can be done to increase total recovery especially at high production rates.
To finish at least when I account for technical aspects of extraction I'm coming up with Hubbert as being essentially correct with a easily extractable global reserve of about 1250 GB with a potential additional 250 GB that could be extracted at a much lower overall extraction rate then today. This overall extraction rate is throttled by two factors. Horizontal drilling leads to rapid depletion so fields extracted with this methods decay rapidly. Thus even though you have a high rate for a individual field the overall rate will drop dramatically when the number of fields in decline exceeds that number of fields in production because of the steepness of decline.
For example if you have 5 fields going into a 20%+ decline that where developed or redeveloped with horizontal wells and one new field coming online the sheer number of fields in steep decline will result in a fast drop in overall production rate. On top of this we also have the problem that newer fields are smaller and have shorter lifetimes generally around 5-10 years.
The next class of older fields are those that have reached 90%+ water cut extraction from these is limited by water handling facilities and it takes a huge investment to get any significant increase in production and in general your simply accelerating the decline rate.
Well, I think this is going to be very reservoir dependent. If you get a layer of 10 milliDarcy rock between two layers of 0.1milliDarcy rock that form a barrier to vertical flow, you'd get nothing out of that bit of reservoir with vertical wells, but something with a horizontal well into it. Stare at a well log like the below for a while (especially the lower zones), and remembering that the deposition is horizontal so those spikes of low permeability could easily be laterally extensive, and it's not hard to see that situations such as I describe could occur.
Hmmm, are you sure? Seems like radial flow to a vertical well would be dominant. Basically a 2D problem as long as the producing layer is intersected by the well.
Intervening layers of low permeability as you suggest would certainly reduce vertical flow between strata, but isn't this essentially a horizontal flow problem anyway?
BTW, thanks for all of your great work.
Stuart this is well beyond anything I could answer. But given a path to flow i.e you have a region that has higher porosity and pressure you will get flow. The simplest example is a pinhole leak.
I did not deny their are cases where porosity is a issue but you can easily reverse the problem oil flowed into the region where the reservoir exists so it can flow out and in most cases fairly readily. We actually know of only a few reservoirs that are so "tight" that horizontal drilling is the only way to economically produce them. In fact even in south Ghawar its not clear that it could not have been profitably produced with vertical wells.
I'm not saying that horizontal wells are not highly productive easily 2-5 times more productive than vertical wells and you don't need tight formations to get the productivity gains.
I'm saying thats the problem.
thanks Stuart.
my main aim i guess is to put out there for discussion a simple but hopefully fairly robust way to estimate the likely contribution from 'reserves growth' and reduce some of the mystery surrounding the concept.
i'll try and come back later today with a bit more description of how i got these numebrs - at this stage though they are a rough first pass at demonstrating the methodology.
if anybody has data on how much recovery increases after applying EOR then i'd love to see that!
cheers
phil.