Horizontal Wells with Multi-Stage Fracs Provide Better Economics for Many Lower Permeability Reservoirs

Abstract

Abstract During the past 5+ years, North America operators have increasingly turned to horizontal completions in low permeability oil and gas reservoirs to maximize their Return on Investment (ROI). As hydrocarbon prices suffered a freefall in late 2008 to mid-2009, this further forced operators to continually evaluate both cost and effectiveness of various completion and stimulation options. In April 2008 the Baker Hughes U.S. rig count for vertical drilling was twice the horizontal rig count, but after the price collapse we soon had more horizontal rigs running than vertical ones, with the June 2010 ratio being ∼1.7:1 while only four years ago the U.S. had 2.5 vertical rigs for every horizontal rig. Globally, the trend toward horizontal drilling of low permeability oil and gas reservoirs is slowly increasing, with some of the lower permeability onshore and offshore fields also following this trend. As operators see many of their current horizontal completions in moderate to low permeability reservoirs reach their economic limit in only a few years, they often would like to use hydraulic fracturing. However, they are realizing the frac limitations imposed by openhole completion methods and even for highly perforated cemented laterals. Only a few viable options currently exist for effectively placing individual hydraulic fractures at (and ONLY at) preselected locations along the completed lateral section. Unfortunately, often the existing completions limit the fracturing rates that can be achieved. The primary focus of the North America model for horizontal well economic success is completions that enhance the ability toachieve both adequate injection rates and effective isolation of hydraulic fracturing stimulation stages. In some fields, a secondary goal is to drain significantly more reservoir per well by using radical lateral lengths and reduce the number of wells needed. Onshore this concept makes each well much more environmentally friendly, and offshore the economic value is even more obvious. This paper will provide a high-points review of the shale formation completion model. With this model it is critical to select the multi-stage fracturing implementation to be used before the lateral completion method can be chosen. Many current methods require that the installed lateral completion contain specific components that are a part of the stimulation isolation method itself. Also reviewed are a few areas that could further advance the present methodology and offer suggestions for where the industry can consider non-shale applications to further proliferate this methodology outside North America.