Peter
COLUMN-Smart fracking will cut costs and save environment: Kemp
source: http://www.reuters.com/article/2012/07/05/column-kemp-fracking-efficiency-idUSL6E8I5A9S20120705
By John Kemp
LONDON, July 5 (Reuters) - Pressure to respond to falling oil and gas prices by cutting operating costs, coupled with the need to reduce the social and environmental footprint on host communities, will force fracking firms to employ a more targeted approach to drilling wells and hydraulic fracturing in future.
More than a million fracturing operations have been conducted in the United States since 1947, according to the U.S. National Petroleum Council, yet in many ways the technology is still immature.
In many instances, fracturing remains an expensive, brute force exercise that wastes resources while causing unnecessary disruption to affected communities.
The relative inefficiency of current fracking approaches was highlighted by Paal Kibsgaard, chief executive of oilfield services company Schlumberger, in a speech back in March .
Too many wells are being drilled into parts of shale formations that have poor production potential, Kibsgaard said. (This is why all wells should be geosteered...Peter)
The horizontal section of wells are often being fracked at regular intervals along the entire length even though significant parts of the laterals have limited or no production potential because the geology is not favourable. (Yes, geologists play a vital role.... Peter)
And in many cases the amount of horsepower and water being applied in each fracking operation is excessive. Massive fracturing networks are being created that extend more than can be propped open with frack sand, and where the unpropped part offers little or no contribution to production.
FINDING SWEET SPOT
In a recent report, researchers for the U.S. Geological Survey (USGS) concluded that "production from the most productive wells in an area is commonly more than 100 times larger than from the poorest productive wells."
For gas wells drilled into the Haynesville Sabine Platform, which lies under parts of eastern Texas and Louisiana, the most productive are expected to yield 20 billion cubic feet of natural gas over their lifetime. But expected ultimate recovery (EUR) from the median well is just 2 billion cubic feet, and at the low end some wells will yield just 20 million cubic feet, according to the USGS.
In the case of oil wells drilled into heart of the Eastern Expulsion Threshold of North Dakota's Bakken Formation, which is the most productive part of the whole area, the best wells are expected to yield as much as 5 million barrels, but the median expected is just 120,000, and some of the worst wells may yield as little as 2,000. (Doing it right separates the winners from the losers.....Peter)
MINIMISING TRAFFIC
Indiscriminate drilling and fracking imposes enormous unnecessary disruption on local communities and is hugely expensive for drilling firms.
For a gas well "each hydraulic fracturing stage pumps around 300,000 gallons of water and up to 200 tons of sand down a well" according to Rick Carr and Sam Pearson of Deloitte Consulting in an article published in "Oil and Gas Journal" ("Unconventional drilling requires managing transportation logistics" June 4).
"A typical development in the Marcellus region can result in 20,000 to 30,000 truckload movements per (drilling) rig per year. Compound these requirements by the fact that there are a total of 138 rigs operating in Marcellus and it becomes easy to understand how transportation is such a concern. Similarly, an estimated 270 rigs are now active in the Eagle Ford, and capacity constraints are becoming a concern" they write.
Carr and Pearson emphasise the importance of careful logistics management to minimise disruption and reduce costs.
According to Deloitte's Wellsite Logistics Model, four wells drilled from a single pad can involve 1,200 truckloads of water for the fracturing and over 800 truckloads of gravel, with more truck movements for equipment and other supplies.
Moving a single rig can involve "50-60 truckloads of large, heavy equipment over a 10-mile distance over a six-day period, while fluid hauls involve the constant movement of more than 200 loads of fresh and produced water each day".
INTELLIGENT FRACKING
Careful management can minimise traffic, but the most effective way to cut costs and disruption is to avoid drilling unnecessary wells in low productivity areas, and avoid unnecessary fracturing stages in parts of laterals that have little or no chance of yielding gas, condensates or crude.
"The combination of optimised well location, well path and completion design is the key in achieving more with less, in terms of production, recovery and costs" according to Schlumberger's Kibsgaard. (Just in case anyone wonders why engineers and geoscientists are in such high demand.....Peter)
Schlumberger cites one completion in the Marcellus where the client achieved 40 percent higher production, in part by fracking only the intervals around the best quality shale rather than spreading them evenly over the horizontal length.
Schlumberger hopes its UniQ seismic surveying system, with improved imaging quality, "will help better predict the variations in shale reservoir quality" and permit better targeting.
Rather than be in the business of providing vast amounts of horsepower, which Schlumberger sees becoming commoditised, the firm wants to focus on technology like imaging and specialist fracking fluids, where it will continue to have more market "leverage".
With natural gas prices under intense pressure in North America, and at least some analysts predicting oil prices have peaked for the time being, other production and services companies seem set to follow Schlumberger in following a more sophisticated system.
The focus is shifting from brute-forcing fracking to a more targeted and technology-intensive approach that seeks to minimise waste and costs, while boosting output per well, thereby doing more with less, and reducing the damaging effects on the environment and local residents.
References:
(1) "Kibsgaard speaks at 40th annual Howard Weil energy conference" March 26, 2012:
(2) "Variability of distributions of well-scale estimated ultimate recovery for continuous (unconventional) oil and gas resources in the United States" USGS, 2012:
