Production optimization is to increase the profitability of reservoir development by adjusting the type of wells and the rate of injection and production. Previous methods put both variables at the same level when optimizing and thus they change at the same frequency. However, these two variables belong to different scales, because well types require time-consuming and labor consuming operations such as borehole operations, while rate adjustment don't. Therefore, in this paper, a hierarchical optimization method is proposed to optimally control well types and corresponding rate in production sequence. Specifically, a hierarchical framework is first employed based on reinforcement learning method, with well types as high-level variables and quantities as low-level variables. Then, two hindsight mechanisms, named action hindsight and goal hindsight, are used to achieve stably joint optimization of two-level variables at different frequencies. Our findings from the case study reveal that our approach is highly practical, as it has successfully reduced operational costs by 90% and increased cumulative oil production by 18% within three years when compared to the single-level reinforcement method.
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