Closed-Loop Stochastic Oilfield Optimization Under Uncertainty in Geologic Description and Future Development Plans

Abstract

Abstract Development and management of oilfields involve several sources of uncertainty that complicate an already challenging decision-making process. Two main sources of uncertainty are related to geologic description of reservoirs and future development scenarios. While geologic uncertainty has been widely studied and robust optimization methods have been developed to account for it, the uncertainty in future development plans has not been considered in optimization problems. Future development strategies have been included as decision variables in field development optimization problems. However, in practice, future field development plans tend to deviate from the solutions obtained in past optimization problems. Therefore, a more prudent and realistic approach toward oilfield optimization is to consider the uncertainty in both geology and future development plans to obtain robust solutions. We develop a closed-loop stochastic field development optimization formulation to account for the uncertainty in geologic description and future infill drilling scenarios. The proposed approach optimizes the decision variables for current stage of planning (e.g. well locations and operational settings) while accounting for geologic and future development uncertainties, where the former uncertainty is represented by using several reservoir model realizations while the latter uncertainty is represented through drilling scenario trees and probabilistic description of future drilling events/parameters. In the developed method, prior to each decision-making stage the reservoir is operated based on the current optimal strategy until dynamic data becomes available to calibrate the geological models. After each data assimilation step, a new optimization is performed to adjust controllable decision variables for the current well configuration (e.g., well rates or BHPs) using the updated models and potentially revised future development scenarios. Using a multi-stage stochastic optimization workflow this process is repeated after each decision stage. Several numerical experiments are presented to discuss various aspects of the proposed closed-loop stochastic optimization formulation and to compare the solutions from different methods adopted for treatment of future development plans. The results indicate that stochastic treatment of future development events (1) can hedge against uncertain future development activities by obtaining optimization solutions that are robust against changes in future decisions, and (2) considerably reduces the performance losses that can result from field development when uncertainty is disregarded.