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Niobrara Chalk Beds, South Dakota, Yankton CountyPhoto Credit: Samuel Calvin, 1873-1911 uiowa.edu

Introduction to the Niobrara

Brief Geologic Overview and Impact on

Completion Strategy

Mike Vincentmike@fracwell.com

303 568 0695

Fracwell LLC

25 minute summary of 5 hour school

• Development History

• Geology

• Variety of Current Completion Strategies

• Completion Challenges We Must Address

Outline

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• History & variety of fields associated with the Nio– 1876: Florence Field near Canyon City CO (associated Pierre Shale)

– Boulder Field. McKenzie #1-21 produced from 1902 to ~2005 (Pierre)

– Salt Creek

– Teapot Dome

– Tow Creek

– Silo Field

– Shallow biogenic gas - W KS, W NE, and E CO >3,000 wells

– DJ Basin (comingle Niobrara, J Sand and Codell) >20,000 active wells

– Twin Buttes & Shell Creek (13,000 to 15,000 ft deep gas)

– 2009: EOG’s Jake horizontal well, 1750 bopd; 680 bopd month 2

• 20 to 2000 ft thick. Found at surface to 24,000 ft deep

• Thermal maturity varies

– Oil, thermogenic gas, condensate, or biogenic gas

• We need to be specific when talking about “the Niobrara”

Niobrara Background

Late Cretaceous, 90 Ma

Ron Blakely, Northern Arizona University http://jan.ucc.nau.edu/~rcb7/90moll.jpg

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Late Cretaceous, 100 Ma

Ron Blakely, Northern Arizona University http://jan.ucc.nau.edu/~rcb7/90moll.jpg

Finn, USGS, DDS-69-D

Oscillating sea levels

Critical to understanding Niobrara deposition

Sample

Strat Column

Showing

BenchesDJ: Wattenberg

Field

200 ft thick at 7,000 ft depth

Sonnenberg 2002, CSM

Western Colorado

>2000 ft thick at 11,000 ft depth

Also

>1500 ft thick at 2500 ft depth

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Relative extent and locationplus some recent Niobrara activity

Base Map:ArcGIS

Bakken

Niobrara

Fluid Types & Depth Range

Oil, gas/condensate, biogenic gas

Surface (outcrop) to 24,000 ft

Whiting (Cody Shale)

True Oil, Barrett

Samson, Termo, Cypress, Quicksilver

Delta, Laramie, Antero, EnCana

EOG, Chesapeake, Baytex, Helis, Resolute

DJ Basin:EnCana, EOG, Noble, Slawson, Chesapeake,

SM, Anadarko, Pine Ridge, Lario, Carrizo, PDC, Marathon, Voyager, Rubicon, Whiting,

Cirque

El Paso

Pioneer, El Paso, Manzano

St Mary, RKI, QEP , Noble, MDU, Rexx, East(Shell), TARC,CHK,MBI(Anadarko)

Laramie, EOG, Bonanza Creek, Wellstar

At least 60 different operators in Niobrara

play

Age equivalent to Austin Chalk

UnderlyingSecond White Specks ~

Favel ~ Greenhorn

Medicine Hat, First White Specks

Age equivalent to Mancos Shale

Assured of Bonanzas, Bubbles & Busts across this

extensive play

Examine Outcrops!

Watney, Kansas Geological Survey

Next image near Lyons

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Examine Outcrops!

From PTTC/RMAG field trip flyer, Gustason, Deacon

Photo from the

Portland Cement

Quarry near Lyons, CO

Outcrop of “A” bench.

• Typically considered a brittle formation, sandwiched between ductile shales

• Even minor structure can lead to natural fracturing

AAPG Explorer, Nov 2010, Durham

• Outcrop of “C” bench between Boulder and Lyons.

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Noble Analyst Day June 3 2010

Variation of Reservoir Conditions

Watney, Kansas Geological Survey and Pollastro

• Kansas

– 40-50% porosity

– 0.2 to 3 mD. >0.5 mD at shallow depths

– Biogenic gas from thermally immature chalk

• Wattenberg

– Four 20-30 ft thick chalk benches

– <10% porosity in some areas

– Fractures mineralized with calcite, quartz, or gypsum

– <<0.1 mD at 3000 – 8000 ft depth

– Thermogenic gas and condensate

• Silo

– Five chalk benches; develop the “B”, 25-35 ft thick

– <6-8% porosity but open vertical natural fissures

– <0.01 mD matrix perm at 7800 ft depth

– Oil, 35-38 API, 500-1000 scf/bbl GOR

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• Vertical Wells

– Mostly cemented

– Nio may be fractured in single or multiple stages (or bypassed)

– Mostly light crosslinked fluids with modest sand concentrations

• Horizontal Wells

– Cemented and Uncemented

– Mostly multi-stage completions, some non-compartmentalized

• Some ball activated sleeves, some plug-and-perf

– Slickwaters, zircs, borates, gelled propane, hybrids. Some acid.

– Most have received low sand concentrations

– Predominantly 20/40 sand, some wells with 100 mesh, 40/70, 30/50

– Some RCS, mostly 20/40, some 30/50. Some flowback concerns

– Some ceramics (40/70 IDC, 30/50 IDC&LDC 20/40 LDC, 16/20 LDC)

– Experimentation with higher proppant concentrations

– Some refracs

Variety of Completion Styles

Why are refracs necessary in

vertical DJ wells?

Pagano, 2006. See also 134330 for discussion of refrac mechanisms

– Gas Condensate wells in DJ Basin – up to 5 restimulations

– Initial fracs used low concentrations of sand

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Increase in Horizontal Drilling

Tom Bratton, SLB

Mid 2012:

40 rigs

8 vertical

15 directional

17 horizontal

Sample Well & Frac Design

• EOG- Jake 2-01H, Weld County 3Q 2009– 7288 TVD, 11,420 MD (11,838 elsewhere) 3800 ft lat

– Cemented

– Frac 430 bbl 7.5% HCl, 12,000 bbl treated water, 53,500 bbls gelled water, 495,000 lb 100 mesh sand, 4.6 mmlbs 20/40 sand

– 1558 bopd max [1770 reported elsewhere], 50,000 bo 1st 90 days

Should we anticipate that horizontal wells will also need to be restimulated?

They are being treated with similar strategies as the vertical wells

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Are challenges similar so we may adapt what we learned in the Bakken?

[SPE 134595, 136757]

Extensive Extensive

Cretaceous ~100 Ma Devonian/Mississippian ~400 Ma

Multiple Chalk Benches Middle Bakken Dolomite + Three Forks/Sanish Sand

Locally abundant fissures, likely important to productivity

Varying significance of fissures

32°to 62°API [crude to condensate] 40°API [light oil in USA]

Underpressured to modest overpressure

Overpressure (0.6 - 0.7 psi/ft)

$ 3 - $5 MM/well $ 6 - $10 MM/well

Niobrara vs Bakken

Both developed with horizontal wells and transverse fractures

Challenge:Limited Intersection between Wellbore and Fracture

Horizontal Well with Transversely Intersecting Frac: Enormous fluid velocity and near-wellbore connection is key!

See SPE 146376 and 144702

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Woodford Shale Outcrop

Some reservoirs pose challenges to effectively breach and prop through

all laminations

Our understanding of frac barriers and kv should

influence everything from lateral depth to frac fluid type, to implementation

Narrower aperture plus significantly higher stress in

horizontal steps?

Failure to breach all laminae?

Will I lose this connection due to

crushing or embedment of proppant?

Challenge: Effective Frac Design

Horizontal Wells• If fracs were highly conductive vertical planes that

penetrated all the pay, it wouldn’t matter precisely what depth you land the lateral…

• But it matters!– Niobrara, Barnett, Viking, Bakken, Eagle Ford, Marcellus

• Fracs either:– Fail to penetrate all the pay, or

– Fail to sustain continuity, or

– Provide inadequate conductivity (large pressure losses), or

– Certain depths/trajectories better for artificial lift

– Perhaps it is an artifact of our completion style….Do we need competent/brittle rock to accommodate overflushing?

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• Design issues

– Role of bentonite layers

– Degree of proppant embedment

– Fluid sensitivity

– Target natural fractures or tectonically quiet areas?

– Some areas sensitive to overflushing & conductivity

• Development near urban and residential areas

– Increased scrutiny regarding completions and wellsite stewardship

• Water availability

– In SE Wyoming, may govern development pace

Some Additional Challenges

• Extensive play, lots of history

– Try to be specific when you talk about the “Nio”

– Many different challenges across the play

• Completion Strategy

– DJ has been the ultimate “poor boy” development

• Infrequent individual well metering

• Poor understanding of individual flowrates, let alone interval production

– More than 5000 refracs have been necessary in the DJ

– Horizontal well completion strategy is equally uninformed

• Enormous opportunities for improvement

– Accommodate complex geology and complex frac geometry

– Improve ability to drain multiple benches

– Accelerate or eliminate restimulation

– More durable frac treatments resistant to embedment, overflushing, flowback, and degradation?

Brief Summary

Available Seminars

• Conventional versus Unconventional Reservoirs • Myths and Misunderstandings that hinder Frac Optimization • Detailed Rock Mechanics, Fluid Rheology, and Propagation Theory • Physics of Fluid Flow • Frac Sand mining and QC, Ceramic manufacturing and QC • Proppant Types, Characteristics – Understanding the differences between sand, resin and

ceramic • Conductivity Testing • Non-Darcy Flow • Multiphase Flow • Understanding Proppant Crush Testing - Are hot/wet crush tests superior? • Other Issues - Embedment, Stress Cyclic, Elevated Temperature • Determining Realistic Proppant Conductivity • Field Results – 200 summarized on SPE 119143; ~30 in PowerPoint • PTA / Well Testing considerations / Effective Frac Lengths • Fines Migration & Plugging • Significance of Proppant Density, Frac width, sieve distribution upon proppant value • Gel Cleanup

– Lab studies and field examples documenting load recovery • Proppant Flowback and Erosive Potential of sand, ceramic, and resin-coated proppants • Frac Pack concepts and field studies • Zero Stress applications – Flow in wellbore annuli or packed perforations • Frac Optimization

– CBM frac optimization – Fracturing Carbonates – Where do unpropped fractures work?

• Horizontal Wells – Comparisons with Vertical Fractured Completions • Specific Field Results (Pinedale, Kuparuk, Cardium, Wamsutter, Birch Creek, Siberia,

Cotton Valley, Vicksburg, Haynesville Lime, UP + Ranger, others) • Bakken Horizontal Wells – Importance of Frac Intersection with Wellbore • Performance under Severe Conditions (Steam, Acid) + Diagenesis • Waterfracs/Slickwater Fracturing • Frac Geometry – What do Fracs Really look like? What errors are we making? • 100 mesh sand – pros & cons • Refracturing

Mike Vincent

Insight Consulting

mike@fracwell.com

303 568 0695