ISWA SeminarMarch 16, 2017

Boise, Idaho

Sinclair Well Products Drilling Fluids Diversification

• Incorporated in 1987 in Los Angeles, Ca• Full-Service Drilling Fluids Company, diversified to serve

ALL drilling industries, with a ‘One-Stop Shop’ Mentality• O&G, Geothermal - Land, Offshore, Townlots, International• Foundation & Geoconstruction• Environmental, Waterwell & HDD• Slim-Hole Coring (Minerals/Mining Exploration)

• 24/7 Facilities in California, Nevada; Vendor Partners throughout the Pacific NW (incl. Caldwell, Idaho)

• Freshwater and Oil-Based Drilling Fluids, Premixed Brines, Abandonment Fluids, Packer Fluids, Specialty Pills, Portable Mixing Tanks, SCE, Storage Tanks

• Drilling Waste Management Expertise and Capabilities• Technical support located in Bend, Oregon, and Extensive

work in Idaho (O&G and Geothermal)

Sinclair Well ProductsIdaho & Pacific NW Experience

• Oregon, Nevada, Utah, Washington States – Drilling Fluids & Services for Dozens of Waterwell, Environmental, Foundation, Geothermal, O&G and Exploration Coring Projects

• Bridge Resources, Alta Mesa, Trendwell – Technical Assistance and Drilling Fluids & Services, Supporting O&G Drilling Programs Near Payette, Caldwell, New Plymouth

• US Geothermal – Provided Drilling Fluids & Services for Wells at Neal Hot Springs (Vale, Oregon) and Raft River(Malta)

• Walker Ranch Energy – Provided Drilling Fluids & Services for Coring Exploration, and for Geothermal Well at Raft River

• Inland Foundation (Boise) - Foundation Drilling Support• Significant Work with EPA, DOHS, AQMD, DEQ, DOTs to

Promote Environmentally-Acceptable Drilling Waste Management Practices

History of Drilling Fluids

• Early Days – Baroid/Cows• 1950s – WaterBased Muds (WBM), Dispersants, Lignites,

Diesel OBMs (DOBM)• 1969 – EPA Act• Mid-Late 1970s – Arab Oil Embargo – International Drilling

Boom, New Product Developments• Mid-’80s – Improved Fluids/Drilling Technologies,

Polymers, SCE, Environmental Concerns, SBMs• Mid-Late ‘90s – Unconventional Shale Development, Long

Reach Horizontals (10,000’ down, 12,000’ Sideways)• 2000s – OMRs, Formates, Olefins, Synthetics,

Lubricants…Current Unconventional Shale Wells• Current – Continued Significant Improvement on Cost-

Effective, Environmentally Acceptable (EPA, DOHS, DEQ) Drilling Fluids Systems and Additives

Function of Drilling Fluids

• Transport Cuttings to Surface (Rheology, Viscosity)

• Prevent Well Control Issues (Mud Weight)

• Preserve and Support Wellbore Stability (Fluid Loss, Shale/Clay Stability)

• Minimize Formation Damage (Inhibition)

• Cool and Lubricate the Drillstring (Lubricants)

• Provide Information about the Wellbore (Logging)

• Minimize Risk to Personnel, Environment and Drilling Equipment (Non-Hazardous)

• Provide All of the Above in a ‘Cost-Effective’ and Environmentally Sensitive Manner (Recycle)

Basic Mud Additives

• Rheology Control – Gel, Polymers (PHPA, Xanthan Gum), Desco/Water

• Filtrate Control – Polymers (PAC, DMA) , Lignites, Bridging Agents

• Lubricity – TORKease, ProOne Nitro (Soy Oil), MD-C, Walnut

• Weighting Agents – Barite, Calcium Carbonate

• Lost Circulation – Conventional LCM, Sawdust, PrimaSeal, Micro C, Mica, etc

• Formation Inhibition – K-Sub, X-Pel-G, Low Filtrate

• Others – Biocides, Defoamers, pH Adjusters

• NSF Certified Products for Drinking Water Standards

MUDSYSTEM

Fluid Loss

Control

Rheology

Control

Lubricity,

Other

Additives

Formation

Inhibition

Lost

Circulation

Control

Weighting

Agents

Mud Decision Criteria

• Review Target Area/Interval (Geological and Historical Considerations)

• Rig Selected? Solids Control Equipment (SCE)• Sumpless Drilling vs Sump• Casing Design• Length/Time of Open Hole Intervals• Inhibition/Wellbore Stability Requirements• Directional Considerations• GeoPressure• Completion Technique (slotted liner vs. slick/casing)• Number of Wells in Drilling Program• Environmental Restrictions/Regulations• Regional Product Availability

CST/SENSITIVITY RESULTS

Mud Tests (Field)

• Density/ECD (depth*.052)/psi + mud weight)• Viscosity• Plastic Viscosity/Yield Point• Gel Strengths (including 30 minute, LSRV)• pH• Filtrate/Cake Thickness• Chlorides• Ca/Mg (Hardness)• Pf/Mf/Pm• Sand• Retort/Low Gravity Solids Content• MBT (Cation Exchange)• Others where appropriate (HTHP, CST, Corrosion, K+ ion)

Basic Mud Kits

Sinclair Well Products‘Mud Metrics’

Sample Charts from Sinclair’s Daily Mud Report

FORMATION DAMAGE MECHANISMS

• Hydratable Clays/Formations (<450°F/230°C)• Bentonite, Barite, Lignite and other Insoluble Mud

Additives• High Temperature Gelation/Dehydration Issues• Non-Degradable LCMs, Poorly Designed LCM Pills• Fine Drill Cuttings Conveyed into the Productive

Interval• Cement Plugs, Massive Mud Losses• Drilling and Formation Fluids Incompatibility

(Inhibition)

INCREASE PRODUCTION PROTECT THE PAYZONE

Mud Systems For IdahoHigh Temps, Swelling Clays (varies significantly by area),

Gas Pressure to 10+ppg, Volcanics)

• Oil & Gas Wells

– PHPA System (early days)

– OBM/SBM System (Oil/Synthetic Oil Base)

– Low pH Claybase (OMR) System

• Geothermal Wells

– HT Claybased System

– Clay-Free ‘Drill-In’ System with Sweeps

• Well Completions

– KCl Brines

– MgCl2, CaCl2 Brines

SINCLAIR’S OBM/SOBM MUD SYSTEM

An Oil-Based Mud System Specifically Designed for Sensitive and ‘Dirty’ Production Zones

• Formulated as a Diesel or LVT-Oil Based Mud System

• Provides Superior Hole Stability, Formation Protection, Shale

Control, and Production Zone Inhibition

• Proven to Increase Production when Compared to Conventional OBMs

• Internal (Aqueous) Phase Provides Multiple Inhibition

Mechanisms – Osmotic Dehydration PLUS Ionic (K+) Inhibition

(no CaCl2)

• Provides Superior Lubricity Properties and Rheology Stability

under elevated BHT (>450°F) and Wellbore Deviation

• Superior Corrosion Protection, Extending Tools/Drill-pipe Life

SINCLAIR’S ‘OMR’ WBM MUD SYSTEM(Oil Mud Replacement)

A Versatile, Cost-Effective System to Replace Oil Base Systems for Critical Drilling Projects

• Formulated as Either a Clay-Based or Brine-Based System

• System is Modified to Provide Desired Fluid Characteristics –

Wellbore Strengthening, Increase Lubricity (Reduce

Coefficient of Friction, Enhance Lubricity)

• Superior Hole Stability and Lubricity, Especially Through

Highly Deviated Intervals

• Cost Effective: Significant Cost Savings Realized, Compared to

Conventional LVT and Diesel-Based Muds

• Environmentally Acceptable, no Sheen or Oil

Idaho – OBM/SBM vs. WBM/OMR System• OBM/SBM Mud System

– PROs: Excellent Inhibition/Wellbore Stability, Stable Flow Properties, Enhanced ROP, Good Cementing CBL, Fully Recyclable

– CONs: High Cost (~$110+k/well), Product Availability and Lead Time, 2 Systems Used/Stored (Claybase for Shallow Intervals), Possible 3-Phase Emulsion Blocking, Environmental Issues; Disposal Costs, ~$40/ton (Liquids and Solids).

• WBM/OMR Mud System– PROs: Cost Effective (~$45k/well), Inhibition for Clays (pH,

Filtrate), Products Readily Available, Recyclable, Lower Cost Disposal, ~$20/ton (Landfill-Approved); Liquids -~$40/ton.

– CONs: Does not Totally Inhibit Clays, Dehydration During Extended Trip/Downtime, Wallcake Buildup

Solids Control Equipment (SCE) & Drilling Waste Management

• Design/Plan SCE Program Based on Well Program

– Linear Hi-G Force Shakers (Primary Separation Stage)

– Hydrocyclones/Mud Cleaner (Secondary Separation)

– Hi-Speed Centrifuge (to Remove Fines)

• Liquid and Solid Wastes - Management on Location

– Bins for Drill Cuttings/Waste Fluids

– Solids Treatment and Stabilization – Sawdust/Zorbix

– Storage Tanks for Fluid Recycling

• Sumpless Drilling/Dewatering

Solids Control Equipment (SCE) & Drilling Waste Management

• Recycle/Reuse to Minimize Offsite Disposal– ALL Drilling Fluids Recycled Whenever Possible

– 500 Barrel Storage Tanks Used for On-Site Storage

• Offsite Disposal Considerations to Minimize Impact– Liquid Wastes

– Drill Cuttings/Spoils - Dried or Stabilized for Ease of Transport to Appropriate Landfill

– Stabilized Cuttings - Possibly Use as Landfill Cover

• Waste Management Reporting– Landfill Pre-Approval

– Paint Filter Test

– Heavy Metals Analysis

$1,000+/day for current state-of-the-art separation equipment

SCE & Drilling Waste Management• Stabilization/Solidification of Drill Cuttings for

Offsite Disposal– On-Site Process– Ties up free water and contaminates/hazards– Pass Paint Filter Test– Possible use as Landfill Cover

CONCLUSIONS

• A Well-Designed, Site-Specific Drilling and Drilling Fluids Program will Provide Cost-Effective Results and Minimize the Potential Impact of Drilling Wastes

• Local Knowledge and Experience are Critical to Support ANY Successful Drilling Program

• A Well-Designed Drilling Waste Management Plan Will Reduce the Offsite Disposal of Both Liquid and Solid Drilling Wastes

• Multi-Well Programs Provide Cost Reduction and Enhanced Efficiencies Through Economy of Scale

Sinclair Well Products offers our extensive Pacific NW experiencesand capabilities to all local Idaho Operators

Sinclair Well Products - Your ‘One-Stop Shop’ 800-782-3222

WELL PRODUCTS & SERVICES

800-782-3222