Chevron- KR Hot Shot OptimizationPracticum

Team Members:Alkan BekturDavid CorralGary DiBenedictCarina Tubajika

Chevron in SJVBU• Operated in California over 127 years• Assets

▫Coalinga▫Cymric/McKittrick▫Kern River▫Lost Hills▫Midway Sunset▫San Ardo

• Top Oil and Gas Producer in California•Produce over 170,000 BOPD

History of Kern River

Project Scope/Problem Statement•Yearly, the Kern River Field is impacted by

the cold weather in the winter months▫Average of 164 BOPD down/month

•Opportunity: Minimize down Oil

Define- IPO

Define- Voice of the Customer InterviewQuestion Customer #1

1. What are the top three problems have you encountered with this process in the past?

• Number of jobs executed per day seem relatively low per number of failures per day.• Not utilizing internal resources (i.e. CVX Operators) well• Backlog of WF wells continue to grow each day. Too many wells are carrying

over

2. What do you think caused the problems in item #1?

• The Resources allocated to this project need to be aligned with the SOP for steaming wells to ensure the execution of the wells are optimized.

3. What has worked well in the process that we should strive to maintain?

• Need to maintain utilizing steam as a cost effective means to unplug the flowlines of the Producers which are down due to cold weather plugging.

4. What defines success for this LSS Project? Do you have a target in mind? If so, what is it?

• The success of this project will be determined on the ability to execute the unplugging of the flowlines to ensure the backlog is reduced/minimized.

5. What key data would you like to see tracked? Leading and lagging indicators.

• Number of jobs executed per day, down wells per day, and the cumulative number of BOPD carried over to the next day.

7

Define- Macro Process

STEAM

OIL SALE$

SEPARATION(Station 36)

STEAMINJECTION

WATERTREATMENT(Station 36)

COGEN

POWERSALE$

WATER

7

ELElectricityRICITY40 MW

AGRICULTURESALE$

PRODUCEDFLUIDS

AUTOMATICWELL TEST(300 Sites)

640 MW

Define- Pareto DiagramSurface failures 2010 Surface Failures 2011

163

406

187

66

160

193154

119

Measure- Micro Process Flow- Pro Tool’s Current Process (Can only place 1 well on steam at a time)

Receive list of (WF) Down

Wells prioritized on 6/mo oil from

Steam Rep

Drive to Well and AWT to ensure the

well can be steamed (i.e. no

Maint. Work nearby/ no clamp

on lines)

Shut Down Unit (Prep for

Seam)

Steam Well for an

additional 30 minutes

POP Well

Cold Plug breakthrough within 2

hours

Drive to well and

continuously monitor for cold

plug breakthrough at

wellhead

Manipulate valves at Header and

Initiate steaming of flowline

Drive to next well location

Complete Paperwor

k

YES

NO

CVX Operator Takes over job or well is left down

until the next day

Notify CVX

Operator

Complete Paperwor

k

Process Constraint

Measure- Daily Failure rate in Winter

11/0

1/10

11/0

6/10

11/1

1/10

11/1

6/10

11/2

1/10

11/2

6/10

12/0

1/10

12/0

6/10

12/1

1/10

12/1

6/10

12/2

1/10

12/2

6/10

12/3

1/10

01/0

5/11

01/1

0/11

01/1

5/11

01/2

0/11

01/2

5/11

01/3

0/11

02/0

4/11

02/0

9/11

02/1

4/11

02/1

9/11

02/2

4/11

03/0

1/11

03/0

6/11

03/1

1/11

03/1

6/11

03/2

1/11

03/2

6/11

03/3

1/11

04/0

5/11

04/1

0/11

04/1

5/11

04/2

0/11

04/2

5/11

04/3

0/11

0

20

40

60

80

100

120

140

160

Winter 2010-2011 Daily Failure Rate

# Failures per Day

2010/2011 Execution rate = 6 jobs/day37% of the days in the winter month’s cannot respond to failure rates within a day.2011/2012 Goal is 12 jobs/day16% of the days in the winter month’s cannot respond to failure rates within a day.

Measure- Histogram

23.8

to <

= 35.

20

20

40

60

80

100

120

140

160

Histogram

# Of Days a well is in downtime due to WF

# O

bse

rvati

ons

Sheet8

Histogram

Normal Distribution Mean = 8.4845Std Dev = 15.652

Analyze- Cause and Effect Diagram

Analyze- 5 Why Tree

•Problem- Wells freezing/plugged with increased down time▫“Why”- Hot shot execution rate is unable to

keep up with daily failures▫“Why”- Pro tool executes on average of 6

wells/day▫“Why”- Pro Tool places one well on steam

and waits on location for 2 hours until breakthrough

▫“Why”- SOP drives behavior▫“Why”- SOP has never been re-validated

Improve- Pro Tool’s Improve Process(Can place multiple wells on steam and continuously monitor for breakthrough)

Receive list of (WF) Down

Wells prioritized on 6/mo oil from

Steam Rep

Drive to Well and AWT to ensure the

well can be steamed (i.e. no

Maint. Work nearby/ no clamp

on lines)

Shut Down Unit (Prep for

Seam)

Manipulate valves at Header and

Initiate steaming of flowline

Continue to place wells on steam and

continuously monitor for breakthrough

Drive to next well and place on steam

Immediately drive back to the header and turn

steam OFF

Cold Plug Breaks through

Drive to Well to determine if

Plug has broken through

YES

NO

POP Well

Drive to next well location

Complete Paperwor

kCold Plug

Breaks through

YES

NO

Improve- Run Chart

October November December January February March April0

2

4

6

8

10

12

14

16

Number of Hot Shot Executions per month(3-man crew)

08-09

09-10

Axis TitleImprovement

Current

Proposed

Improve- Project Goals

11/0

1/10

11/0

7/10

11/1

3/10

11/1

9/10

11/2

5/10

12/0

1/10

12/0

7/10

12/1

3/10

12/1

9/10

12/2

5/10

12/3

1/10

01/0

6/11

01/1

2/11

01/1

8/11

01/2

4/11

01/3

0/11

02/0

5/11

02/1

1/11

02/1

7/11

02/2

3/11

03/0

1/11

03/0

7/11

03/1

3/11

03/1

9/11

03/2

5/11

03/3

1/11

04/0

6/11

04/1

2/11

04/1

8/11

04/2

4/11

04/3

0/11

0

50

100

150

200

250

300

350

400

450

500

0

20

40

60

80

100

120

140

160

Winter 10-11 Impact of Improvement

# Failures per DayFailure to Carry te Next Day (without Improvement)Failure to Carry te Next Day (with Improvement)Delta

Improve- Financial ImpactImpact in Barrels = Delta of Wells Carried Over * Average Production (Over 30 days Down)

21,600 Barrels = 14,400 well days*1.5 BOPD per well

  December 11 January 12 February 12

Nonfuel Opex $8.41 $4.15 $5.88

Oil Price $66.51 $70.34 $69.42 Barrels/Month (1.5* Down Wells/day) 2,660 7,772 11,168

Total $/Month 154,546 514,429 709,615

Cum $ 154,546 668,975 1,378,589

Assumptions•Only cashed in 3/months of improved execution•Use BOPD from actual wells that were down more than 30 days with a WF code•Captured value for an increased execution rate when failures were greater than baseline execution rate.

Control Plan & Future Improvement Opportunities•Control Plan-

▫Continuously monitor improved process and re-validate SOP yearly.

•Future Improvement Opportunities▫Have real time monitoring of steam flow ▫Leverage internal resources for proactive

stimulation to minimize plugged wells.

Questions??