Lesson 12 Candidate and Technique Selection

PETE 689 Underbalanced Drilling (UBD)
Lesson 12
Selecting an Appropriate Technique Read: UDM Chapter 4 pages 4.1-4.54
Harold Vance Department of Petroleum Engineering
Selecting an Appropriate Technique

Potential applications and candidate technique. Technical feasibility. Economic analysis.
Required Data For UBO Candidate Identification

Pore pressure/gradient plots. Actual reservoir pore pressure. ROP records. Production rate or reservoir characteristics to calculate/estimate production rate. Core analysis.

Formation fluid types. Formation integrity test data. Water/chemical sensitivity. Lost circulation information. Fracture pressure/gradient plot.

Sour/Corrosive gas data. Location topography/actual location. Well logs from area wells. Triaxial stress test data on any formation samples.
Poor Candidates For UBD

High permeability coupled with high pore pressure. Unknown reservoir pressure. Discontinuous UBO likely (numerous trips, connections, surveys). High production rates possible at low drawdown.

Weak rock formations prone to wellbore collapse at high drawdown. Steeply dipping/fractured formation in tectonically active areas. Thick, unstable coal beds.

Young, geo-pressure shale. H2S bearing formations. Multiple reservoirs open with different pressures. Isolated locations with poor supplies. Formation with a high likelihood of corrosion.
Good Candidates For UBD

Pressure depleted formations. Areas prone to differential pressure sticking. Hard rock (dense, low permeability, low porosity). Crooked-hole country and steeply dipping formations.

Lost-returns zones. Re-entries and workovers (especially pressure depleted zones). Zones prone to formation damage. Areas with limited availability of water.

Fractured formations. Vugular formations. High permeability formations. Highly variable formations.

Once the optimum candidate has been identified, the appropriate technique must be selected, based on much of the same data required to pick the candidate.
Candidate Decision Tree-Sheet 1

Previous history of underbalanced Operations (UBO)? No
Hydrocarbons anticipated
Yes
Go to Sheet 2
No
Drilling problems anticipated
No
No UBO
Yes Yes
Lost circulation
No Yes Cost/safety benefits No
Stuck pipe
No UBO
No
Hard drilling (ROP/bit)
Yes
Yes
Candidate
No No UBO
Detailed engineering (cost, safety, reservoir, Mechanical main drivers) Harold Vance Department of Petroleum Engineering

Depleted reservoir
Yes
Go to Sheet 3
No
Drilling Problems anticipated
No
No UBO
Yes
Lost circulation
Yes
Reservoir damage Production impairment
No
No UBO
No
Stuck pipe
Yes Yes
Cost /safety benefits
No
No UBO
No
Hard Drilling (ROP/bit)
Yes Yes
Candidate
No No UBO

Drilling problems anticipated
Yes
Lost circulation
Yes
No No
No Yes Yes
No UBO
Reservoir damage Production impairment
Stuck pipe
Cost /safety benefits
Candidate
Yes Candidate
No Yes
No
Hard Drilling (ROP/bit)
No UBO
No
No UBO
This decision tree can be found on the IADC website (www.iadc.org). Click on Committees. Click on Underbalanced Drilling committee. Click on decision tree.
Potential Applications and Candidate Technique
Low ROP Through Hard Rock

Dry air. Mist, if there is a slight water inflow. Foam, if there is heavy water inflow, if the borehole wall is prone to erosion, or if there is a large hole diameter. N2 or natural gas, if the well is producing wet gas and it is a high angle or horizontal hole.
Lost Circulation Through The Overburden

Aerated mud, if the ROP is high (rock strength low or moderate) of if water-sensitive shales are present. Foam is possible if wellbore instability is not a problem.
Differential Sticking Through The Overburden

Nitrified mud, if gas production is likely, especially if a closed system is to be used. Aerated mud, if gas production is unlikely and an open surface system is to be used. Foam is possible if the pore pressure is very low and if the formations are very hard.
Formation Damage Through A Soft/Medium-Depleted Reservoir

Nitrified brine or crude.
string injection, if the pore pressure is very low. parasite injection, if the pore pressure is high enough and a deviated/horizontal hole needs conventional MWD and/or mud motor. Temporary casing injection, if the pore pressure is intermediate and a high gas rate in needed.
Formation Damage Through A Soft/Medium-Depleted Reservoir

Nitrified brine or crude, cont.
String and temporary casing injection, if the pore pressure is very low and/or if very high gas rates.
Foam, if the pore pressure is very low and an open surface system is acceptable.
Formation Damage Through A Normally Pressured Reservoir
Flowdrill (use a closed surface system if sour gas is possible).
Lost Circulation/Formation Damage Through A Normally Pressured, Fractured Reservoir
Flowdrill (use an atmospheric system if no sour gas is possible).
Formation Damage Through An Overpressured Reservoir.
Snub drill (use a closed surface system is sour gas is possible).
Technical Feasibility
In evaluating the feasibility of candidate drilling techniques, a controlling factor is the range of anticipated borehole pressures which will be required for each zone to be drilled. The upper limit for UB conditions is formation pore pressure. Lower limit will generally be regulated by the lowest pressure at which wellbore stability is ensured.
First step is to determine the anticipated pressures. Step two is to determine which methods are functional within the anticipated pressure window.
Other considerations are:
Will there be sloughing shales? Are aqueous fluids inappropriate? Will water producing horizons be penetrated? Will multiple, permeable zones, with dramatically different pore pressures, be encountered?
Other considerations cont:
What is the potential for chemical formation damage, due to fluid/fluid or fluid/formation interaction and is this an overwhelming problem, regardless of what wellbore pressure is used? Is there a potential for sour gas production?
Other considerations cont:
Are there features of the well geometry which dictate specific underbalanced protocols? What is the local availability of suitable equipment and consumables (including liquids and gases for the drilling fluids)?
Borehole Pressure Limits

Pore pressure
The wellbore pressure must be maintained below the formation pressure in all open hole sections. If there is no formation fluid inflow, borehole pressures with dry gas, mist, foam or pure liquid will be lower when not circulating. With fluid influx, borehole pressure can increase or decrease when not circulating.

Pore pressure Best practice is to use the:
Lower bounds for pore pressure prediction when choosing a technique. While surface equipment capacity and drilling specifics should be based on an upper bound.

Wellbore stability provides the lower limit to the allowable borehole pressures. Will be discussed later.

Hydrocarbon production rates can sometimes set the lower bound, depending upon the surface equipment available. Formation damage may effect the tolerable drawdown due to fines mobilization in the producing formation.

Backpressure from a choke can sometimes be used to protect the surface equipment from excess production rates or pressures. This also increases the BHP. The allowable backpressure is limited by the pressure rating of the equipment and formation upstream of the choke.
When using compressible fluids, it is usually more cost effective to switch to a higher density fluid than to choke back the well.

Applying back pressure will:
Increase the gas injection pressure. Increase the gas injection rate required for acceptable hole cleaning. These both will increase the cost of the gas supply.

With a gasified liquid, BHP can usually be increased by reducing the gas injection rate. When drilling with foam, back pressure may be necessary to maintain foam quality. Holding back pressure is most beneficial when drilling with liquids.

Once the maximum tolerable surface pressure is reached, production rate can only be further reduced by increasing downhole pressure by increasing the effective density of the drilling fluid.
Implications of Drilling Technique Selection

Pore pressure gradients vary with depth. Formation strength varies with depth. In-situ stresses vary with depth. The tolerable stresses, are affected by by the inclination and orientation of deviated, extended reach and horizontal wells.

Production rates depend on the length of the reservoir that is open to the wellbore and on the underbalanced pressure.

Once the borehole pressure limits, corresponding to wellbore instability and excessive production rate, have been determined , a first pass evaluation of the different drilling techniques can be performed.
Example 1
4500 4000
Borehole Pressure (psi)
Shallow, normally pressured reservoir.

No wellbore stability problems. Surface equipment can handle the anticipated AOF. Minimal water inflow is expected.
3500 3000 2500 2000 1500 1000 500 0 0 2000 4000 6000 8000 10000
True Vertical Depth (feet)
Stability regimes for the well described in Example 1.
Example 2
Depleted sandstone from 3,000 to 4,000 ft with a pore pressure gradient of 5 ppg. Pore pressure above the sand is 8 ppg. Lost circulation and differential sticking is a problem with mud. No instability problems anticipated if borehole pressure is > 2 ppg. Production rate is low.
4500
4000 3500
3000 2500 2000 1500 1000 500 0 0 2000 4000 6000 8000 10000
Stability regimes for the well described in Example 2.
Example 3
Pore pressure = 8 ppg Shale from 6,000-8,000 requires a minimum wellbore pressure of 7 ppg Target zone is 9,000 Reservoir itself is competent unless borehole pressure < 5 ppg Expect high flow rates. maximum drawdown = 500 psi Pore p. at 9,000 = 3,744 psi min BHP = 3,244 psi or 6.93 ppg
4500 4000 3500
3000 2500 2000 1500 1000
500 0 4000 5000 6000 7000 8000 9000 10000
Stability regimes for the wells described in Examples 3 through 5
Example 4
4500 4000 3500
Maximum drawdown = 100 psi. Equivalent to 7.79 ppg.
3000 2500 2000 1500 1000
Diesel or crude gives a pressure lower than this. Plain water is too dense.
500 0 4000 5000 6000 7000 8000 9000 10000
Example 5
4500 4000 3500
Reservoir is depleted to 6.5 ppg. Maximum drawdown is 500 psi. The tolerable range for ECD through the reservoir would be 5.4-6.5 ppg. A gasified liquid would be required.
3000 2500 2000 1500 1000
This would not supply sufficient support for the shale above.
500 0 4000 5000 6000 7000 8000 9000 10000
Evaluating Highly Productive Formations

Require detailed numerical analyses of circulating pressures. Formation fluid influx interacts with drilling fluids which effect borehole pressure - effecting influx rate.

When circulation stops, the influx lifts mud from wellbore. This changes the borehole pressure and the production rate.

Choking back the well returns further complicates the calculation of borehole pressures and production rate. If the fluid is incompressible, backpressure changes BHP by the amount of pressure applied. If the fluid is compressible, backpressure changes density, velocity, and BHP.

Uncertainty of input parameters in simulators leads to uncertainty in output. In many cases these uncertainties can make simulations in technique selection unjustified.
Water Production
Production of small quantities of water makes dry gas drilling difficult. If offset wells have a history of water production, dry gas drilling below the water zone is probably impractical.
Water Production
When misting, higher gas rates are required to prevent slug flow. Slug flow can damage the borehole and surface equipment. Higher injection rates and the increased density in the annulus may require boosters on the compressors.
Water Production
Large water influxes may require foams. High disposal costs can sometimes make mist drilling impractical. Higher density foams can decrease water influx, however the increased volume of make-up water may make disposal still impractical.
Water Production
If high water influx makes gas and foams impractical, aerated mud or low density liquids may be required.
Multiple Permeable Zones

If all zones are to be drilled UB, the circulating pressure must satisfy the borehole pressure requirements for all open permeable zones, simultaneously. Several factors can prevent this from happening.
Factors Preventing UB In All Zones

The ECD of compressible fluids increases with increasing depth. In vertical wells, it is possible for a permeable zone close to the bit to be overbalanced when a permeable zone higher up hole, with the same pore pressure gradient, is UB.

This effect is more pronounced in high angle and horizontal wells. AFP increases along the borehole even if formation pore pressure remains relatively constant along the borehole.

Changes in pore pressure gradient along the wellbore may be present. This can be due to abnormally pressured formations, or partially depleted formations.
Multiple Permeable Zones

The major concern with multiple permeable zones is the potential for underground blowouts. Extreme care must be taken to prevent this from happening when pressure changes occur such as tripping, or connections.
If Cross Flows Cannot Be Tolerated:

Use a different drilling technique that allows all permeable zones to remain UB, if possible. Kill the well before suspending circulation. Change the casing scheme so that the upper formations are cased of before penetrating the lower zone in the hole.
Sour Gas
There must be no possibility of releasing hydrogen sulfide into the atmosphere while the well is being drilled or completed. If any is produced during drilling it must be disposed of in a suitable flare.
Sour Gas
H2S can become entrained in any liquid in the wellbore, and must be completely removed from the fluid and flared before any of the liquids are returned to any open surface pits. The separation process should be completed in a closed vessel.
Sour Gas
Sour gas can become entrained in foams. The foam must be completely broken prior to separation. Unless effective defoaming can be guaranteed foams cannot be used in closed systems, and should not be used in the presence of Hydrogen Sulfide.
Drilling/Reservoir Fluid Incompatibility

It can be difficult to prevent temporary overbalance. Drilling fluids should be tested for compatibility with formation fluids.
Hole Geometry
A compressible fluid will have a greater ECD in deep wells than in shallow wells. Annular gas injection only reduces the density of the fluids above the injection point. Drillpipe gas injection may be necessary if long vertical sections are to be drilled with gasified liquid.
Hole Geometry
Increasing ECD with depth may make it impossible to maintain the proper foam quality in deep wells. Backpressure may be required, increasing the gas supply needed. Increasing hole size makes hole cleaning more difficult.
Hole Geometry
Large hole sizes may require larger diameter surface equipment. Larger surface diverter equipment may not have the pressure rating of smaller resulting in lower back pressure capabilities.
Naturally Fractured Formations

In fractured formations, high viscosity drilling fluids, circulating at low rates may prevent hole enlargement and still maintain UB. Stiff foams may be the preferred candidate.
Logistics
Water supplies may be limited in some areas, and a technique that limits water use may be chosen. Availability and access to the gaseous phase can influence the choice of gas used.
Logistics
Offshore locations generally do not have the same space available as land locations. Equipment used on surface locations may not be suitable for offshore locations. Modular closed systems must be used offshore.
Logistics
The high production rates necessary for offshore wells to be economically viable may make them unlikely candidates for UBD.
Economic Analysis
Rules of thumb. UBO increases costs 1.25 - 2.0 times the cost per day over conventional. but may be accomplished in 1/4 to 1/10 of the time.
Economic Analysis
Rules of thumb. In permeable rock ROP may be increased from 30% to 300% as well goes from overbalanced to balanced. Below balance ROP will increase another 10-20%. In impermeable rock, ROP will increase 100-200%.
Drilling Days
0 1000 2000 0 20 40 60 80 100 120
3000
Depth (feet)
4000 5000 6000 7000
8000 9000 10000
Gas and mud effect on drilling time (after Moore, 197456).
Rotating Time (hours)

0 0 10 20 30 40 50 60 70 80 90 100
500
1000
Depth (feet)
1500
2000
2500
3000
Air and water effect on drilling time (after Moore, 197456).
Steps for Economic Analysis

1.Determine the expected penetration rate or drilling time of each candidate hole-interval, if the operation were to be carried out conventionally. 2.Estimate the daily cost of conventional drilling operations for each prospective hole-interval based on empirical data.
Steps for Economic Analysis

3.Multiply the conventional daily cost by an underbalanced factor (1.3-2.0, depending on difficulty of the operation) to get the expected daily cost of UBO. 4.Apply the expected underbalanced operating cost by the anticipated underbalanced drilling ROP to get the total cost for each interval.
Factors that Effect the Economics of UBD

Penetration rate. Bit selection. Bit weight and rotary speed. Mud weight.
Completions and Stimulation

UBO does not save completion time. But, if you are going to drill UB to prevent formation damage, you better complete UB. Mitigation of formation damage in wells that will need to be hydraulically fractured (except naturally fractured) may be a poor and unnecessary economic decision.
Formation Evaluation
Real time formation evaluation possible. UB coring possible.
Environmental Savings
Closed systems make smaller reserve pits and locations possible, but there is additional costs of rental of the systems.
Fluid Type
The bottom line controlling factor may be the specific fluid system adopted. Each fluid type has technical and economic advantages and limitations.
Drilling Method or Fluid System
Savings
High penetration rates and reduction in rig time.
Low bit cost
Problems and/or Potential Expenditures

Possible problems if water flow is encountered
Hole erosion, if poorly consolidated. Possibility of downhole fire, if hydrocarbons are encountered. Supplementary equipment rental. Is not suitable for H2S
Air
Low water requirement No mud removal Low additives cost
Savings
High penetration rates and reduction in rig time. Low bit cost

Problems if water flow is encountered. Cost of gas and/or rentals. Hole erosion, if poorly consolidated. Cost is high if a market for the gas exist. Rig safety. Supplementary equipment rental If H2S is expected, consider a closed system.
Gas (Nitrogen or Natural Gas)
Low water requirement No mud removal Low additives cost
Savings
High penetration rates and reduction in rig time. Low bit cost

Problems if substantial water flow is encountered. Gas Cost if air not used. Hole erosion, if poorly consolidated.
Mist
Low water requirement
Shale stability.
Disposal of waste water/gas and supplementary rental cost. Air-mist not suitable if H2S is present. Equipment rental.
No mud removal
Modest additives cost.
Savings
High penetration rates and reduction in rig time. Low bit cost. Low water requirement. High solids carrying capacity.

Considerable foamer cost. Gas cost if air not used. Careful metering required. Specialized metering equipment. Defoaming.
Stable foam
Good hole cleaning capability.
Compatible with oil, salt water, calcium carbonate and most formation contaminants.
Can safely entrain a considerable volume of gas into aqueous foam, rendering in nonflammable until sumped. Can handle large flows of water.
Considerable cost.
Separation and disposal.
Water disposal
Savings
High penetration rates and reduction in rig time. Low bit cost.

Considerable mud and chemical cost. Gas cost if air is not used. Fluid degradation possible if oil, salt water or calcium chloride are encountered. Specialized metering equipment. Defoaming.
Stiff Foam
Low water requirement. High solids carrying capacity. Good hole cleaning capability.
Savings

Expense of running a parasite string or a temporary casing string. Higher gas rates are required. Slow pressure response if a parasite string is used. Low underbalance pressure may cause transient departures from underbalanced conditions and advantages to impairment reduction may be lost. Tool problems with drilling injection. Supplementary surface equipment. Corrosion potential (and requirement for inhibitors air is used.
62)
Higher bottomhole pressures.
Gasified Liquids
Improved directional drilling in comparison to dry gases or mist (refer to chapter 6). Reduced drillstring wear. Reduced potential for downhole fires in vertical holes with aqueous fluids.
is
Savings
Higher borehole pressures reduce the possibility of instability.

Supplementary surface equipment and safety measures. Excessive production is possible. Safety issues associated with oil and gas on drill site.
Flowdrilling
No gas supply system. Conventional mud motors and MWD units can be used.
Mudcap Drilling
Can be used in situations where surface pressure is too high for flowdrilling.
Can be used at pressures too high for conventional units and underbalanced drilling equipment. Environmental savings
Supplementary equipment and safety considerations.

Snubbing or CT unit.
Snub Drilling or CT
Closed Systems
Equipment rental and operating cost Cannot be used with explosive mixtures.
Can handle H2S. Better monitoring returns.
Cost Comparisons - Case 1 Nitrogen vs. Pipeline Gas

General Assumptions
Flowrate...3,000 cfm Gas Price $2.00/mcf Trucking Distance.... 50 miles (one way) Drilling Hours/day.... 20 Average Gas Drilling Days/well .12 Diesel Usage/hour/unit.10.7 gallons Diesel Fuel Price... $ 0.80/gallon Standby Days (Equipment)/well........... 4
Cost Comparisons - Case 1

Nitrogen Drilling System Cost
Compressors (8) @ $135/unit/day Boosters (2) @ $200/unit/day (air use) Membrane Skids (2) @ $1,500/unit/day (1,800 cfm/skid) $ 12,960 $ 4,800 $ 36,000
Pipeline Gas Drilling Cost

Pipeline gas 43.2 mmcf @ $2.00/mcf Booster (2) $300/unit/day (gas use) Drill Gas Unit (installed on location) $ 86,400 $ 7,200 $ 1,000
Trucking/Transportation Fuel (delivered)

25,680 gallons * $0.80/gallon Mist Pump Equipment Standby (4 days)
$ 9,200
$ 20,540 $ 1,500 $ 1,800
Gas Line (2,000 feet)

Trucking/Transportation Fuel (delivered) 5,138 gallons @ $0.80/gallon Mist Pump Equipment Standby (4 days)
$ 1,800
$ 1,800 $ 4,110 $ 1,500 $ 700
Total Nitrogen Drilling Cost/well
$ 88,600
Total pipeline Gas Drilling Cost/well
$ 104,510

Item
Drilling Program N2 Duration of N2 requirement N2 Purity N2 Pressure
Liquid N2
90 days 1,500 scfm 240 hrs (10 days) Minimum 95 % (by volume) 5,000 psi 1,500 scfm * 60 min/hr * 24 hr/day *10 days = 584,000 sm3 = 834,000 liters liquid N2 = 139 tanks Trucked in liquid N2 (equipment rental)
Portable N2 Generating System

90 days 1,500 scfm 240 hrs (10 days) Minimum 95 % (by volume) 5,000 psi
N2 requirement
1,500 scfm * 60 min/hr * 24 hr/day *10 days = 584,000 sm3
Method of N2 Supply
On-site membrane (equipment purchase)

Item
Logistics
Liquid N2
139 liquid N2 tanks, 1 evaporator and 1 diesel skid (141 containers)
Portable N2 Generating System

4 skid maximum, 14 tonnes each, 1 power unit, 14 tonnes (5 containers) Electrical power: 1,400 kW * 10 days * 24 hrs @ $0.05/kWh = $ 16,800 (Power unit rental included in capital cost) 10 % of interest and depreciation $ 32,000 Interest and depreciation over 10 years $324,000
Cost of Utilities (liquid N2 , electricity, diesel)
$ 1,284,000
Maintenance Capital Cost
None
None
TOTAL
Approximately $ 1,300,000
Approximately $ 375,000
Economic Analysis
On the basis of available technology, select the potential drilling systems to be evaluated. Tabulate the tangible and intangible costs for each system. Rely on previous history and recognize the inevitability of statistical variation.
Economic Analysis
Perform basic cost/ft drilling evaluations.
CT = [B+Cr(t+T)] / F
Where: CTtotal cost/foot. B.bit cost. Crhourly rig cost. t..rotating time. T.round trip time. F.footage per bit run.
(4.12)
Assess Drilling Costs

Item
Interval Interval Length (F) (ft) Penetration Rate (ft/hr) Rotating Time (t) (hr) Bit Life (hr) Bits Required Unit Bit Cost
Air Drilling
From 4,000 to 7,000 ft 3,000 30 100 100 1 $ 4,800/bit $ 4,800 Trip in to 4,000 ft Trip out from 7,000 ft
Mud Drilling
From 4,000 to 7,000 ft 3,000 15 200 100 2 $ 4,800/bit $ 4,800 Trip in to 4,000 ft Trip out from 5,500 ft Trip in to 5,500 ft Trip out from 7,000 ft
Bit Cost (B)

Trip Schedule
Total Trip Footage Unit Trip Time (hr/1,000 ft)
11,000 ft 1.5
22,000 ft 1.5
Assess Drilling Costs

Item
Trip Time (T) (hr) Hourly Operating Cost (Cr) Cost / ft [B+Cr(T+t)]/[F] Competitive Cost for Air Drilling Barrels of Water That Can be Disposed of at $ 1.00/bbl Barrels of Water That Can be Disposed of at $ 5.00/bbl Barrels of Water That Can be Disposed of at $ 10.00/bbl
[4,800+Cr(16.5+100)] / [3000] = $ 22.62t Cr = $ 541.29/hr ($541.29 - $375)/ $1.00 = 166 * 24 = 3,984 BWPD
Air Drilling
16.5 $ 375/hr
Mud Drilling
33 $ 250/hr [9,600+250(33+200)] / [3000] $ 22.62 /ft
($541.29 - $375)/ $5.00 = 33 * 24 = 798 BWPD

($541.29 - $375)/ $10.00 = 16.6 * 24 = 400 BWPD
25 24 23 22
Cost ($/ft)
21 20 19 18 17 16 15 0 500 1000 1500 2000 2500 3000
Barrels of Produced Water per Day
Economic water volume production (modified after Carden 19931).
Accelerated Production
Earlier production can improve the NPV
NPV = 1 / (1+DR)t = (1+DR)-t

NPV = net present value (discounted value of asset). DR = discount rate. t = discount time, years.
Improved Production/Reserves
The absolute and relative increase in production should be calculated, or estimated. Productivity Index, PI should be calculated based on whether the well is vertical, horizontal, oil, gas, radial, transient flow, or pseudo-steady state flow (see page 4.48).
Well Inflow Quality Indicator, WIQI, is the ratio of the PI for an impaired to that for an undamaged well.
Considering the evaluating PI: following example for
K 50 mD H 25 feet 2 cP Bo 1 bbl/sbbl re 1,980 ft rw 0.411 S variable Orientation vertical depth 10,000 ft reservoir pressure 4,300 psi BHPP 3,000 psi (pseudo-steady state)
Skin
0
Production Rate (BOPD)

761 674 604 462 331
PI
0.572 0.507 0.455 0.348 0.249
WIQI
1 0.89 0.79 0.61 0.44
1
2 5 10 100
55
0.041
0.07
800 700 1.12 600 500 400 300 200 100 0 0.84 0.7 0.56 0.42 0.28 0.14 0 0 1 2 5 10 100
Skin
Economic water volume production (modified after Carden 19931).
Well Inflow Quality Indicator Productivity Index
0.98
Production Rate (BOPD)
Example
Oil well Revenue Interest Working Interest Gross Income (per net bbl) Crude Price Less Transportation Production taxes Leaves Gross Income (per net bbl) Estimated Op. Expense Number of wells = R = 0.375 = WI = 0.5 = $20.00/bbl
= $1.00/bbl = $6.00/bbl
= $13.00/bbl = $5000/well month =5
Case 1
All five wells drilled in the first year with a conventional mud system.
Case 1 (Base Case)

Year
Estimated Future (1) Gross Lease Production (2) Net Production To Operator (3) Gross Income To Operator (4) Development Cost (5) Number of Producing Well Months (6) Operating Expense Operation Units
Total
bbl
201,204
170,280
122,952
96,720
77,960
55,388
18,024
742,528
R * (1)
bbl
75,452
63,855
46,107
36,270
29,325
20,771
6,759
278,448
(2) * $13.00
980,870
830,115
599,391
471,510
380,055
270,017
87,867
3,619,824
750,000
750,000
60
60
48
48
36
36
24
312
(5) * $5,000
300,000
300,000
240,000
240,000
180,000
180,000
120,000
1,560,000
Case 1 (Base Case)

Year
Estimated Future (7) Capital Expenditure (8) Share of Operating and Capital Expenses (9) Cash Flow to Operator (10) 5% Annual Deferment Factor (11) Present Worth Of Cash Flow Operation Units
Total
20,000
20,000
20,000
20,000
20,000
20,000
20,000
140,000
WI * [(4)+(6)+(7)]
535,000
160,000
130,000
130,000
100,000
100,000
70,000
1,225,000
(3) (8)
445,870
670,115
469,391
341,510
280,055
170,017
17,867
2,394,824
0.9740
0.9276
0.8835
0.8414
0.8013
0.7632
0.7268
0.9010
(10) * (9)
434,277
621,599
414,707
287,347
224,408
129,757
12,986
2,157,736
DCR
i t
DCR= [(1+i)1-t (1+i)-t] / 12[(1+i)1/12 -1]

annual deferment factors, applicable to equal payments at the end of each month during a specific interval of year between (t-1) an t years from now. effective annual compound safe interest rate as a decimal fraction. time in years
Case 2
Same as Case 1 with the exception that there is higher production to reduced formation damage from UBD.
Case 2
Year
Estimated Future (1) Gross Lease Production (2) Net Production To Operator (3) Gross Income To Operator (4) Development Cost (5) Number of Producing Well Months (6) Operating Expense Operation
Units
Total
bbl
221,324
187,308
135,247
106,392
85,756
60,927
19,826
816,781
R * (1)
bbl
82,997
70,241
50,718
39,897
32,159
22,848
7,435
306,293
(2) * $13.00
1,078,956
913,127
659,330
518,661
418,061
297,018
96,654
3,981,806
750,000
750,000
60
60
48
48
36
36
24
312
(5) * $5,000
300,000
300,000
240,000
240,000
180,000
180,000
120,000
1,560,000
Case 2
Year
Estimated Future Operation Units
Total
(7) Capital Expenditure

(8) Share of Operating and Capital Expenses (9) Cash Flow to Operator (10) 5% Annual Deferment Factor (11) Present Worth Of Cash Flow
20,000
20,000
20,000
20,000
20,000
20,000
20,000
140,000
WI * [(4)+(6)+(7)]
535,000
160,000
130,000
130,000
100,000
100,000
70,000
1,225,000
(3) (8)
543,956
753,127
529,330
388,661
318,061
197,018
26,654
2,756,806
0.9740
0.9276
0.8835
0.8414
0.8013
0.7632
0.7268
0.9010
(9) * (8)
529,814
698,600
467,663
327,019
254,862
150,364
19,372
2,483,883
DCR
i t
DCR= [(1+i)1-t (1+i)-t] / 12[(1+i)1/12 -1]

Case 3
Same as case 2 with the exception that development costs for the five wells are $150,000 less, due to improved drilling while underbalanced.
Case 3
Year
Estimated Future (1) Gross Lease Production (2) Net Production To Operator (3) Gross Income To Operator (4) Development Cost (5) Number of Producing Well Months (6) Operating Expense Operation
Units
Total
bbl
221,324
187,308
135,247
106,392
85,756
60,927
19,826
816,781
R * (1)
bbl
82,997
70,241
50,718
39,897
32,159
22,848
7,435
306,293
(2) * $13.00
1,078,956
913,127
659,330
518,661
418,061
297,018
96,654
3,981,806
600,000
600,000
60
60
48
48
36
36
24
312
(5) * $5,000
300,000
300,000
240,000
240,000
180,000
180,000
120,000
1,560,000
Case 3
Year
Estimated Future (7) Capital Expenditure (8) Share of Operating and Capital Expenses (9) Cash Flow to Operator (10) 5% Annual Deferment Factor (11) Present Worth Of Cash Flow Operation Units
Total
20,000
20,000
20,000
20,000
20,000
20,000
20,000
140,000
WI * [(4)+(6)+(7)]
460,000
160,000
130,000
130,000
100,000
100,000
70,000
1,150,000
(3) (8)
618,956
753,127
529,330
388,661
318,061
197,018
26,654
2,831,806
0.9740
0.9276
0.8835
0.8414
0.8013
0.7632
0.7268
0.9010
(9) * (8)
602,864
698,600
467,663
327,019
254,862
150,364
19,372
2,551,458
DCR i t
DCR= [(1+i)1-t (1+i)-t] / 12[(1+i)1/12 -1]

Summary of all Cases

(Present Worth of Cash) Year
1
434,277
Case
1
2
621,599
3
414,707
4
287,347
5
224,408
6
129,757
7
12,986
Total
2,157,736
529,814
698,600
467,663
327,019
254,862
150,364
19,372
2,483,883
602,864
698,600
467,663
327,019
254,862
150,364
19,372
2,551,458
Summary of Examples
700,000
Present Worth of Cash Flow ($)
600,000
500,000
400,000
300,000
200,000
100,000
0 1 2 3 4 5 6 7
Year
Projections Over Seven Years

Lesson 12 Candidate and Technique Selection

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PETE 689 Underbalanced Drilling (UBD)

Selecting an Appropriate Technique

Harold Vance Department of Petroleum Engineering

Required Data For UBO Candidate Identification

Required Data For UBO Candidate Identification

Harold Vance Department of Petroleum Engineering

Required Data For UBO Candidate Identification

Poor Candidates For UBD

Harold Vance Department of Petroleum Engineering

Poor Candidates For UBD

Harold Vance Department of Petroleum Engineering

Poor Candidates For UBD

Good Candidates For UBD

Poor Candidates For UBD

Harold Vance Department of Petroleum Engineering

Good Candidates For UBD

Harold Vance Department of Petroleum Engineering

Good Candidates For UBD

Harold Vance Department of Petroleum Engineering

Candidate Decision Tree-Sheet 1

No Yes Cost/safety benefits No

Candidate Decision Tree-Sheet 2

Reservoir damage Production impairment

Harold Vance Department of Petroleum Engineering

Candidate Decision Tree-Sheet 3

Reservoir damage Production impairment

Cost /safety benefits

Hard Drilling (ROP/bit)

Potential Applications and Candidate Technique

Harold Vance Department of Petroleum Engineering

Low ROP Through Hard Rock

Lost Circulation Through The Overburden

Harold Vance Department of Petroleum Engineering

Differential Sticking Through The Overburden

Formation Damage Through A Soft/Medium-Depleted Reservoir

Harold Vance Department of Petroleum Engineering

Formation Damage Through A Soft/Medium-Depleted Reservoir

Formation Damage Through A Normally Pressured Reservoir

Flowdrill (use a closed surface system if sour gas is possible).

Harold Vance Department of Petroleum Engineering

Lost Circulation/Formation Damage Through A Normally Pressured, Fractured Reservoir

Flowdrill (use an atmospheric system if no sour gas is possible).

Harold Vance Department of Petroleum Engineering

Formation Damage Through An Overpressured Reservoir.

Snub drill (use a closed surface system is sour gas is possible).

Harold Vance Department of Petroleum Engineering

Harold Vance Department of Petroleum Engineering

Harold Vance Department of Petroleum Engineering

Harold Vance Department of Petroleum Engineering

Harold Vance Department of Petroleum Engineering

Borehole Pressure Limits

Harold Vance Department of Petroleum Engineering

Borehole Pressure Limits

Harold Vance Department of Petroleum Engineering

Borehole Pressure Limits

Harold Vance Department of Petroleum Engineering

Borehole Pressure Limits

Borehole Pressure Limits

Borehole Pressure Limits