New Decline Curve Tool for GOM3/GOMsmart & “Forgotten Oil & Gas Study”

2012 GOM3 User Conference at AnadarkoJohn D. Grace, Ph.D.

Earth Science Associates

New Tool Objectives

• Provide a robust tool for forecasting production & estimating remaining resources by completion/completion interval

• Introduce optional new method for refining decline curve analysis accounting for “breaks in regime”

• Internally, use tool in batch mode to identify opportunities for further production

Decline Curves

• Use regression analysis to forecast a production series beyond the last observation

• With forecast “integrate under the curve” for remaining resources ≥ abandonment level

• Use confidence intervals on regression to estimate confidence intervals on remaining

• Use analysis of breaks in time series to improve on “naïve” regression models

Stereotypical Decline CurveBa

rrel

s pe

r day

Oil Production

100

200

300

400

1 2 3 4

Years on Production

Fitting a Decline Curve

• Classical functional forms of decline curves– Exponential (rate vs. time)– Hyperbolic (rate vs. time)– Linear (rate vs. cumulative production)– P/Z vs. cumulative production (gas only)

• Where does the estimable decline start?– Global maximum production rate?– At the last significant structural break in regime?

Exponential Decline Model

bxy ae

Hyperbolic Decline Model

01

0(1 ) k

qq

kb t

Linear Decline Model

y a bx

(P/Z) Linear Model

y a bx

Improving & Choosing Model

• Statistical measures of “goodness of fit”– R2 and “predicted R2”– Statistics on estimated parameter of decline– Still under research (e.g., retrospective forecast)

• Actuarial approach (cum. prob. den. function)• Optimal choice of structural break– Last break – problem of shutting down well– Compare candidate breaks (& forms) against cdfs– Allow user to chose break point

Actuarial Approach to EUR

0 2 4 6

0.2

0.6

0.4

0.8

1

0Cum

ulati

ve P

rob.

Million bbls

Oil

0 10 20 30 40 50

0.2

0.6

0.4

0.8

1

0

BCF

Gas

Conditioning Variables: Drilling date, perf thickness, geologic age, reservoir volume, reservoir permeability, GOR, oil viscosity, gas specific gravity, reservoir drive mechanism, operator (?)

Exploiting Structural Break in Regime

Global Max Terminal Regime

Break

Default:We findbreak

Option:You setbreak

Adding Water to Analysis

Tool Interface (in GOMsmart)

Tool looks the same in GOM3 & the GOMsmart Map but is called from the Hot Link Tool

Tool Output

Charts

Reports

Excel Download

“Forgotten Oil & Gas Study”

• Motivated by running Decline Curve Tool in batch mode – ~60,000 completions/ completion intervals– Sensitivities to abandonment rate