Artificial Lift Selection Strategy to Maximize Unconventional Oil and Gas Assets Value

Abstract

Abstract The challenges of producing and lifting unconventional oil and gas economically is no doubt the most daunting phase of unconventional oil and gas development. The traditional approach of lift selection is no longer sufficient to effectively manage unconventional wells, with high decline rates between 40 to 80% in the first year. Slug flow, high free gas production, solid (proppant, scale, paraffin), horizontal wellbore geometry, surface pad for multi-well in a cellar, and other unique unconventional wells problems are continuously testing the limit of our existing artificial lift systems. As it might be expected, this is invariably, affecting the economic viability of unconventional oil and gas production. This paper presents an exceptional Artificial Lift selection process, required to maximize unconventional oil and gas asset value. The presentation includes a case study of Permian Delaware basin unconventional formations. The lift evaluation process which includes, a combination of several output from various models (reservoir, well and economic models) developed to analyze the economic impact of various artificial lift selection on the well-life is also presented. Three distinct periods are defined for the analysis: Managed Flow-Back Managed Production (Managed Drawdown) End of Life The overarching impact of lift selection and application, on Lease Operating Expense (LOE), Net Present Value of Cash Flow, Overall Asset Value Rate of Return on Investment and other Economic Indicators, for oil and gas operators is highlighted in this paper. Artificial Lift Types were evaluated based on several criteria through elimination and selection techniques. Artificial Lift is phased over the life of the well according to current and expected production rate requirement and lift method capability. Other major consideration includes flexible rate delivery, solid handling, and failure frequency - repair cost and operational expense and initial lift cost and required infrastructure. The output from the type of curve/production forecast, combined with well performance modeling was used to determine future well and reservoir performance. Formation was grouped into various categories based on reservoir characteristics and fluid properties The results showed cases of lift type selection for various types of unconventional formation. Actual well performance and lease performance results are also presented. The managed production (drawdown) period has a major deciding factor on the artificial lift selection strategy. Combination of traditional artificial lift selection processes with several other model output to create artificial lift selection strategy for Permian Delaware basin unconventional formation is applicable in other unconventional basins