Well Spacing Index, a New Approach for Planning the Oilfield Development

Abstract

Abstract The main objective of this work is to develop a methodology to relate the recoverable oil reserves, with the number of wells required for their extraction, while ensuring maximum economic efficiency and creation of value. The idea of "well spacing index", which is defined as the optimal number of wells to drill or complete per each million of barrels to recover in a specific reservoir, can achieve this goal. This optimum number of wells can be estimated from different perspectives; for example, maximizing the net present value, internal rate of return, the recovery factor or minimizing investment, among others. This article has as its starting point in the work of R. Corrie (2001), from which the idea of well spacing index is introduced; allowing comparison with many reservoirs simultaneously, regardless of their of dimensions and is especially useful for quick calculations, management, planning, and drilling-portfolio-ranking. The Well-Spacing-Index calculated from Corrie's equation depend on variables such as the average initial oil production rate per well, the oil prices, the average cost of drilling and completion per well and the discount rate of the operating company; in others words, has a dynamic and changing character, depending on these variables. This not static aspect, allows introducing another concept: "dynamic spacing", which is graphically illustrated in this paper. For a wide range of data, the WSI varies between 0.3 and 1.3, and an average value of 0.7 is recommended for quick calculations. It is also possible to determine the well spacing index, to maximize the internal rate of return or investment-efficiency. However, net present value is the objective preferred by many companies. The equations for well spacing index optimizing internal rate or return and investment efficiency is developed in appendix A No confidential information is published in this paper and data used are from public domain.