UNCONVENTIONALRESERVES

Reliable Asset Performance

A custom publication to

Overview
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Editor in Chief WILLIAM PIKE wpike@hartenergy.com Director, Custom Publishing MONIQUE A. BARBEE mbarbee@hartenergy.com

Pessimistic forecasts that the end of the hydrocarbon age is near often ignore a key element the promise of unconventional oil and gas reserves, a resource even larger than the known reserves of conventional oil and gas.

Technologies

Contributing Editor JOHN KENNEDY

Along with special problems in each type of unconventional oil or gas reservoir, there are challenges that span several resource types. These broader challenges connect a number of important Halliburton technologies.

Art Director ALEXA SANDERS asanders@hartenergy.com Graphic Designer JAMES GRANT jgrant@hartenergy.com Production Manager JO LYNNE POOL jpool@hartenergy.com For additional copies of this publication, contact Marcos Alviar at ext. 150. Group Publisher, Electronic Content CLIFF JOHNSON cjohnson@hartenergy.com Director of Business Development & Custom Communications PAUL HELTON phelton@hartenergy.com Group Publisher RUSSELL LAAS rlaas@hartenergy.com

Coalbed Methane

Coal, the most abundant hydrocarbon in the world, is a major source of methane gas. Because of its large internal surface area, coal stores between six and seven times more gas than the equivalent rock volume of a conventional gas reservoir.

Shale

As part of the bundle of unconventional energy resources that also includes tight sands and coalbed methane, gas from shale can make a significant contribution to the global energy supply.

Tight Gas

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Unconventional gas comes from three key sources: low-permeability sandstones and carbonates, coalbeds and gas shale. Currently, it accounts for about 7% of U.S. gas production.
LP

Hart Energy Publishing,

Sr. Vice President & CFO KEVIN HIGGINS Executive Vice President FREDERICK C. POTTER President & Chief Executive Officer RICHARD A. EICHLER

Heavy Oil

14

The heavy oil resource is large, but its contribution to supply so far has been modest. As lighter crudes become scarcer and harder to find, however, they will make up a declining share of the global oil supply and heavy oil will have to take up the slack.

Halliburton Bibliography Number H04564

Overview

Unconventional Oil and Gas Resources are Huge Solvable Problems

Pessimistic forecasts that the end of the hydrocarbon age is near often ignore a key element the promise of unconventional oil and gas reserves, a resource even larger than the known reserves of conventional oil and gas.

nconventional reservoirs are vastly undeveloped for one good reason: their contents have been much more difficult and therefore more costly to produce, transport and refine than conventional oil and gas. In the mid-2000s, however, with light sweet crude at more than $60/bbl and natural gas above $12/MMBtu, interest in developing unconventional supplies has been recharged. Halliburton began long before that, however, to develop technologies to help recover heavy oil, tight gas and coalbed methane at a competitive cost. Research and development (R&D) continue to enhance those tools and find new solutions. In addition to its substantial in-house R&D budget, Halliburton works with a variety of other companies and organizations on the technical and economic issues surrounding unconventional resources. One such effort is the Halliburton Center for Unconventional Resources of the Crisman Institute for Reservoir Management at Texas A&M University. The centers mission is to increase the ability to characterize unconventional reserves and develop new, more efficient ways to reduce costs and improve recovery. Halliburton also helped create the Gas Technology Institute (GTI)/New Mexico Tech unconventional gas roadmap to identify unconventional gas R&D needs. To help guide future technology development, GTI and the New Mexico Institute of Mining and Technology conducted a series of workshops that outlined high-priority research directions.

762 billion bbl in 1984 to 1,018 billion bbl in 1994, then to 1,189 billion bbl in 2004, according to BP. Natural gas reserves for the same years grew from 96 Tcf to 5,048 Tcf, then to 6,354 Tcf. But oil and gas arent magically replaced when they are consumed; increasing supply has required large amounts of capital and aggressive innovation. In the years ahead, even massive investment in conventional oil and gas development may not be enough to meet demand.

Conventional supply will need help

For almost a century and a half, supplies of conventional oil and gas have kept pace with ballooning demand. In 2004, global oil consumption was 81 million b/d and natural gas consumption stood at 94.9 Tcf, according to the BP Statistical Review 2005. Global reserves are still impressive; in fact, the more the world uses, the more it seems to have. Despite growing consumption, recoverable conventional oil reserves climbed from

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Overview

Output in mature provinces already is declining. The U.S. Energy Information Administration (EIA) expects U.S. production of Lower 48 non-associated conventional natural gas to decline from 9.5 Tcf in 2003 to 8.6 Tcf in 2025. Offshore production will peak at 3.9 Tcf in 2008, then decline to 3.6 Tcf in 2025. After climbing for several decades until the mid-1980s, the number of global oil and gas discoveries has since been declining. The total amount of reserves found each year has been steadily falling for much longer while annual production just as steadily increased. The two curves crossed in the mid-1980s. The good news is that the unconventional hydrocarbon resource is large enough to take up the slack, and the economic and technical problems to be faced can be solved.

Unconventional oil: How big?

Unconventional oil resources are currently several times the 1.2 trillion bbl of conventional oil considered recoverable at the end of 2004. In a July presentation to the Seventh World Congress of Chemical Engineering in Glasgow, Scotland, Iain Conn, group executive officer for strategic resources with BP , said, there are over 4 trillion bbl of oil in place between the Canadian tar sands and Venezuelan extra heavy [oil] alone. A U.S. Geological Survey (USGS) fact sheet prepared by Richard F . Meyer and Emil D. Attanasi in August 2003 estimated that technically recoverable heavy oil reserves amount to 434 billion bbl. About three-quarters of the recoverable heavy oil is in the Western Hemisphere, much of that in Venezuelas Orinoco belt. In spite of an immense resource base, heavy oil and natural bitumen accounted for only about 3 billion bbl of the 25 billion bbl of crude oil produced in 2000, according to the USGS. Of the 35 billion bbl of heavy oil estimated to be technically recoverable in North America, about 7.7 billion bbl is in the lower 48 states and 7 billion bbl on the North Slope of Alaska. According to the EIAs long-term reference case forecast, production from oil sands, ultra-heavy oils, gas-to-liquids technologies, coal-to-liquids technologies, biofuel and shale oil will grow to 5.7 million b/d in 2025, up from 1.8 million b/d in 2003.

The size of some parts of the resource is hard to grasp. In a 2005 presentation, World Oil and Gas Resource and Production Outlook, Ken Chew, vice president of industry performance and strategy for IHS Energy, estimated in-place reserves of gas hydrates, for example, at 90,000 Tcf. Recoverable reserves, however, may be a different story perhaps only the 3,000 Tcf in place in permafrost to be developed in the near term. The ability to develop other unconventional gas sources coalbed methane, tight gas sands, gas shale is much more advanced. The United States is expected to have 700 Tcf of coalbed methane, compared with its conventional gas reserves of 187 Tcf. Chew put the global recoverable gas from coal at 1,000 Tcf. U.S. dominance stems from its almost 250 billion tons of coal, about 27% of the worlds reserves, according to BP. The EIA expects U.S. production from unconventional gas sources to increase more rapidly than conventional gas production. In its long-term forecast, Lower 48 unconventional gas production grows from 6.6 Tcf in 2003 to 8.6 Tcf in 2025 and from 35% of total Lower 48 production in 2003 to 44% in 2025. Cambridge Energy Research Associates estimates unconventional gas plays tight sands, shale gas and coalbed methane will constitute close to half of total U.S. gas production by 2012.

Technology is still a key

Higher oil and gas prices have been needed to drive the development of unconventional oil and gas resources. However, just as it has for almost 150 years, technology will be the key to making those resources recoverable and affordable. Much of the effort to boost tight gas recovery will focus on stimulation. Chief among the challenges of producing heavy oil is the fact that most of it is between 5 American Petroleum Institute (API) and 12 API gravity range and viscosity ranging from 10 centipoise to millions of centipoise. Aside from recovering unconventional oil and gas at a competitive price, some sources pose special environmental challenges. Heavy oil development, for example, must be compatible with expanding efforts to put the world on a lowcarbon diet. Some unconventional sources, however, may result in higher recovery and environmental benefit. Using carbon dioxide (CO2) to improve coalbed methane recovery, for example, also sequesters that amount of CO2. These and other issues will drive development of the technology that will solve the problems faced in exploiting unconventional oil and gas.

Unconventional gas: Even bigger

Conventional gas reserves stood at more than 6,300 Tcf at the end of last year. When unconventional sources are added to the potential resource, the future of gas becomes a vast opportunity. Because it is clean burning, every cubic foot of gas that can be brought to the market will be welcome.

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Technologies

Common Objectives Connect Solutions to Unconventional Reservoir Challenges

Along with special problems in each type of unconventional oil or gas reservoir, there are challenges that span several resource types. These broader challenges connect a number of important Halliburton technologies.

ffective stimulation is a key to developing coalbed methane and tight gas reserves, as well as heavy oil reservoirs. In every completion, protecting the formation face during drilling and completion, and removing damage that does occur, are top priorities. Horizontal and multilateral wells are increasingly important for developing a variety of unconventional oil and gas resources. Cost-effective tools to treat multiple productive layers in a single well are especially important in tight gas sands, gas shales and coalbed methane formations. Water influx and problems related to under-pressured zones can threaten the ability to optimize reservoir performance in many reservoirs. Halliburtons solutions to these challenges are highlighted here; more targeted solutions for specific problems are detailed in later chapters.

CobraMax service provides a more efficient way to fracture multi-interval vertical wells that achieves the performance of through-tubing fracturing with the speed and versatility of coiled tubing. The SurgiFrac service has been applied successfully in multiple propped fractures and multiple acid fractures in open holes, deviated cased holes and horizontal slotted liners. It has been used with coiled tubing to bypass damage and perform multiple fractures in cased vertical and horizontal wellbores.

Better stimulation results

The goal of stimulation can no longer be only an acceptable initial producing rate, but the best possible early production rate and the highest ultimate recovery. To do that, fractures must be created precisely where they will be most productive. Often, these fractures must be created in multiple layers in a single well and in horizontal or vertical wells. It must be done in a cost environment that typically is unusually restrictive. Pinpoint stimulationHalliburton has a family of advanced technologies that provides cost-effective pinpoint stimulation to help assure that every viable pay zone is stimulated: SurgiFrac service is a combination of hydra-jetting and fracturing technologies for open holes that uses the dynamic movement of the fluid to divert fluid flow into a specific point in the formation for effective control of fracture initiation and propagation; Cobra Frac service is an effective, affordable service that can stimulate multiple zones in a single trip by straddling each individual productive stringer; and

In the SurgiFrac service, sand-laden fluid pumped through a Hydra-Jet tool creates a cavity in which increasing pressure initiates a fracture.

The process requires the control and evaluation of two primary fluid flows and two separate pumping systems. Treatment design specifies the number and types of fractures (small or large, sand or acid) and their precise location. A jetting tool on the end of the treating string is used initially to create a small jetted cavity in the formation. Low sand concentrations also can be used during the jetting stage to perforate a liner or cemented casing. Because of the boost pressure created within the jetted cavity by the jetting action, the total pressure within the cavity is several hundred pounds per square inch higher

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Technologies

than the wellbore (annular) pressure. Because pressure inside previously placed fractures is never high enough to cause them to re-open and extend, no mechanical isolation is required. SurgiFrac service is well suited for acidizing a carbonate zone or using proppant-laden slurries to achieve fracture conductivity. Many small and large fractures can be placed sequentially, starting from the toe of the lateral and continuing back to the heel. Fracture acidizing or proppant slurry fracturing can be used at different locations along a lateral.

With SurgiFrac service, it is theoretically possible to create large and small acid fracs in lime areas and to place large and small propped fractures in sandstone/chert areas.

and to the wellsite, and occupies a smaller operating footprint. The service uses proven SurgiFrac technology to quickly and cost-effectively stimulate multiple zones that require larger, higher-rate treatments than are possible with conventional coiled tubing fracturing. CobraMax services high performance in multi-interval vertical wells comes from optimizing injection rate as well as proppant volume and concentration. The CobraMax process involves pumping through conventional coiled tubing using Hydra-JetSM service to create perforations and initiate fractures. The main fracture treatment is pumped concurrently through the coiled tubing/casing annulus. Using the annulus as the main flow path for stimulation fluids offers important advantages. Maximum injection rates can be achieved because of the larger flow area. Since jetting is done at much lower rates through coiled tubing, the annulus is free from the high jet differential pressures. Proppant volumes also can be larger when injecting treatment slurries down the annulus, enhancing conductivity for load recovery and production. The process provides a near-wellbore proppant pack at the end of the treatment but provides a way to remove excess proppant via the coiled tubing. Multiple intervals can be treated without the need for tripping to change out the bottomhole assembly (BHA), regardless of proppant volume.

Cobra Frac service stimulates multiple zones in a single trip by straddling each individual productive stringer. Single-day stimulation reduces time-to-production and cost, and the smaller footprint of fracturing equipment minimizes environmental impact. Good candidates for the technology include the following: wells with multiple zones that need to be stimulated, locations in environmentally sensitive areas, casing integrity problems and bypassed pay behind pipe. The Cobra Frac service team recently set a world record by treating 19 zones in two wells with a single crew in a 12hour day. A total of 520,000 lb of 20/40 sand was placed at concentrations of up to 16 lb/gal. Wells responded with superior production at higher flowing pressures. Speed and performanceFew situations prove the old adage time is money as well as time spent on a wellsite, where compromise must often be made between speed and performance. The CobraMax fracturing service was designed to solve this dilemma. It has the performance of conventional through-tubing fracturing and the speed and versatility of coiled tubing operations. It requires fewer trips in the hole

CobraMax service process begins by pumping through conventional coiled tubing using Hydra-Jet service to create perforations and initiate fractures.

The CobraMax BHA has no temperature limits and the service has no depth limitations except for the reach of the coiled tubing. Fracturing can be done on live wells in casings 3 1/2-in. or larger.

Stimulation tool solutions

Zonal isolation historically has been achieved with inflatable plugs in an open hole or with cast iron plugs in casing. Inflatable packers, however, have not been reliable and

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Technologies

drilling or retrieving cast iron plugs can cause problems. The remains of a plug can drop on top of the undrilled plug below, increasing drill out time on successive plugs, and sand left in the wellbore can make retrievable plugs difficult to remove. Halliburtons Fas Drill, a composite epoxy-glass frac plug, is designed for completing multiple coal seams. It provides staged zonal treatment with flowback capabilities after treatment and reduces drill out time. Wellhead isolationHalliburtons Wellhead Isolation Tool (WIT) isolates the wellhead from exposure to treating fluids and pressures. A seal element and mandrel inserted through the existing wellhead and tubing hanger into the production tubing allow treating fluids to be pumped through the WIT directly into the production tubing. Tubing pressure activates the tool by energizing the sealing element. The WIT can be used to upgrade the working pressure limits of wells for many stimulation requirements. Simple and economical, the WIT is ideal for breakdown treatments and fracturing jobs. It also is used to protect the wellhead from high pressure in tubing conveyed perforating situations where pressure actuated firing heads are used. An independent hydraulic system provides positive control and greater reliability while the mandrel is inserted into tubing. The tool is installed and removed without killing the well. The assembly is attached to the wellhead, and the mandrel is extended completely through the wellhead to seal in the tubing body. The mandrel cup-type sealing element can be adapted to fit various tubing sizes and weights. Multi-zone stimulationHalliburtons Delta StimTM sleeve, used for selective multi-zone fracturing or acidizing, is operated by a mechanical or hydraulic shifting tool run on coiled or jointed tubing. The Delta Stim sleeve maintains wellbore integrity while stimulating multiple zones and allows full wellbore access. There is no limit to the number of sleeves that can be run in a single string. Opening the sleeve allows zonal stimulation through the selected sleeve and diverts the flow through the ports in the sleeve. After stimulation, all lower zones are flowed simultaneously to aid cleanup, and the Delta Stim sleeve will function as a standard production device allowing full wellbore access. Rated at 10,000psi, the sleeves can be shifted with coiled tubing or jointed pipe methods. A single coiled tubing or jointed pipe trip can open or close the sleeve. The Magnum Stimulation ValveTM is run in the casing string at predetermined depths and cemented in the wellbore above

each target zone. The full open wellbore is then perforated and stimulated. The Magnum Assembly Sleeve is then pulled and opened, allowing the springloaded flapper to close, isolating the lower completed zone. The next zone up hole can then be perforated and stimulated, and the sleeve that isolates that zone pulled.

Stopping fines
Conductivity Endurance fracturing combines Halliburtons SandWedge agent and proppant coating technologies with tailored treatment design and proppant selection. The agent is applied directly to dry proppant or sand before it Magnum Stimulation Valve is added to the treatment is an alternative to using compos- fluid, permitting use in deeper and hotter wells. It can be ite plugs to isolate zones during used with all Halliburton fracturing operations. water-based fracturing fluids. By completely encapsulating each grain, the SandWedge system helps prevent frac gel adsorption onto the proppant surface. Because the coating remains sticky, fines adhere to the proppant and do not migrate to the pore throats. A formulation of the SandWedge agent is available that conforms to all overboard oil and grease limits set by the U.S. Minerals Management Service for the Gulf of Mexico and can be used in other environmentally sensitive areas.

Mitigating perforation damage

In many unconventional oil or gas reservoirs, reservoir pressure is too low to effectively clean perforations with conventional under-balanced perforating, or the shaped charge perforation tunnel length in the formation is not sufficient to bypass drilling damage because of unusually high formation compressive strengths and effective stresses. In these cases, it becomes necessary to look at alternative perforating strategies to ensure good connectivity between the wellbore and the reservoir. A near-wellbore stimulation technique, extreme overbalanced (EOB) perforating, can mitigate perforation damage in these cases. EOB perforating also provides perforation breakdown in preparation for other stimulation methods,

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eliminating the need for conventional perforation breakdown methods to remediate poor perforating practices. The EOB technique involves pressuring the wellbore above the formation fracture gradient with compressible gases above relatively small volumes of formation compatible liquid, developing a high level of stored energy. Upon expansion at the instant of gun detonation, the gases are used to inject the liquid into the perforations to fracture the formation and divert fluids to all intervals. The high flow rate through relatively narrow fractures in the formation is believed to enhance near-well conductivity by extending the fractures past any drilling formation damage. Marathon Oil Co. recently used proppant carriers in the EOB perforation assembly to introduce proppants into the flow path as the gun detonates. Marathons patented POWR*PERFSM process further enhances productivity by scouring the perforations to leave some residual conductivity on the fracture plane. Propellant-assisted perforating techniques also are becoming more widely accepted. The StimGunTM assembly, also patented by Marathon, combines solid propellant technology with conventional perforating in one process. The StimGun assembly can be used for EOB or conventional underbalanced perforating techniques. The byproduct of the StimGun assembly is the creation of high pressure carbon dioxide (CO 2) gas above fracture gradient at a controlled burn rate; a niche market for this technique is heavy oil reservoirs and injection wells in general or wells where some form of pumping is required ahead of the production phase.

the productive layers have early water breakthrough. There is little or no risk of reducing permeability to hydrocarbons, no special placement techniques are required and the treatment can be removed. CW-Frac service provides long-term performance and does not chemically or mechanically break down when used in bottomhole static temperatures below 250F (121C). It is compatible with CO2, hydrogen sulfide and high-salinity brines after placement.

Directional drilling
Complete directional drilling capabilities are critical to the development of tight gas and heavy oil resources; a smooth hole can have an impact on every element of well construction. Sperry Drilling Services SlickBore drilling system combines a matched mud motor and bit system that can improve rate of penetration, enhance directional control and improve hole quality. Placing the well is also crucial, especially in unconventional reserves and in smaller targets that often require complex well paths and more accurate wellbore positioning. Sperrys StrataSteer 3D geosteering service integrates a digital 3-D geological earth model, directional well plans, petrophysical model and real-time logging-whiledrilling (LWD) sensor data into a dynamic, interactive and intuitive geosteering application. Utilizing an iterative Model-Measure-Interpret-Optimize process, the service minimizes risk and uncertainty while drilling. During real-time geosteering operations, LWD measurements are acquired at the wellsite and replicated at the customers office through Halliburtons INSITE data acquisition, display and interpretation system. An innovative integrated workflow, which includes well planning, geosteering and continuous reservoir model updating, the service is driving better results in cycle time, drilling time and potential reservoir deliverability for one customer. The success of the work processes depends on technical and interpersonal elements. This new method has brought tangible benefits to the client in a complex reservoir setting where geologic interpretation at the bit drives a fundamentally new way of drilling horizontal wells. These benefits include: optimal wellbore placement; smoother trajectory; overall reduction in drilling time; decreased planning time; possible reduction in the number of stratigraphic wells required; and potential increase in well performance.

Controlling water
Halliburtons CW-FracSM service helps control water incursion when fracturing near a water zone. It can be used in intervals previously bypassed because of proximity to mobile water. CW-Frac service can be used with nearly any of Halliburtons fracturing systems and can be added to the pre-pad, the pad or the fracturing fluid. In the process, the polymer leaks off into the near fracture rock matrix and attaches to the walls of the pore throats. Hydrophobic polymer branches help reduce the flow area of the pore throat in a high water-saturation matrix, but the polymer has little impact on the effective permeability of the rock to oil or gas. However, the polymer system does not seal the matrix pore throats and some continued water production is to be expected. The technology is especially applicable to wells with water coning and intervals in which some but not all of

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Coalbed Methane

Stimulating Multiple Seams, Limiting Impact of Fines Vital

Coal, the most abundant hydrocarbon in the world, is a major source of methane gas. Because of its large internal surface area, coal stores between six and seven times more gas than the equivalent rock volume of a conventional gas reservoir. Busting clots with tacky particles
Halliburtons CoalStimSM post-fracture service can boost CBM production, extend well life and add reserves. It has been used to reverse production declines in more than 500 CBM wells in the western United States. In some cases, entire fields have been treated, and treatment payout has been as short as 9 days. The service helps remove wellbore damage and coal fines blockage with a powerful back flush and can restrict the mobility of formation fines (coal, shales, clays). The service degrades polymer left from fracturing operations and helps dissolve precipitates or carbonate scales. CoalStim agents initially act as clot busters, helping break apart the internal bridges and agglomerates. Then, the agents act as clot formers, making coal particle surfaces tacky. The tacky particles form clots that adhere to formation features and proppant grains away from the fluid flow paths. The result is a highly conductive flow path from the coal matrix to fractures, then to the wellbore.

elatively abundant and cleaner-burning than the coal in which it is found, coalbed methane (CBM) has much undeveloped potential to be an important energy source. With 27% of the worlds estimated coal reserves, the United States will continue to be a dominant player in developing this resource. According to the U.S. Geological Survey (USGS), U.S. inplace CBM amounts to more than 700 Tcf, though less than 100 Tcf may be economically recoverable. Worldwide in-place resources may be as much as 7,500 Tcf, according to the USGS, but only 1,000 Tcf may be recoverable, said Ken Chew, vice president of industry performance and strategy for IHS Energy. U.S. proven recoverable reserves were estimated at about 18.7 Tcf in 2003, up from 10.2 Tcf a decade earlier. Production of CBM in 2003 was 1.6 Tcf, accounting for 8% of U.S. gas production. With the growing concern about carbon dioxide (CO2) emissions and the development of CO2 stimulation technology, CBM production from some reservoirs can serve two important objectives: increase gas supply; and provide a place to sequester CO2. With the focus on CO2, Halliburton has been developing new approaches to the use of CO2based frac fluids. Trial of a new gel system that is a cross-linked CO2 foam was recently successful. When used to stimulate a coal bed, the CO2 releases more gas from the coal matrix, but stays locked in the coal and does not contaminate the gas stream. Halliburton is developing other innovative stimulation fluids to lower resistance to the diffusion of methane from the coal and reduce permeability damage to the cleat system. The objective is to locate fractures precisely, minimize formation damage and provide the ability to remove damage that does occur. Horizontal drilling, multilateral completion and related technologies can now reduce the environmental impact of CBM development, and promise to dramatically enhance productivity and recovery.

CoalStim service forces fines away from the wellbore and then binds the fines in place to open a flow path and help prevent replugging.

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Coalbed Methane

The thin CoalStim carrier fluid is pumped under high pressure into the damaged fractures, then the well is shut in to allow the chemical process to alter the surface of the fines. Finally, pump pressure is released to allow fluid in the well to rush out, flushing solids out of the wellbore area. Material that previously blocked the wellbore is held immobile at the extremes of the fracture so gas can more easily enter the wellbore. When an operator producing from a mature CBM basin implemented the CoalStim process to help extend the life of a field, a typical treatment response was a 17.5% increase in gas production rate. During the long life of a typical CBM well, such an increase can add up to a significant increase in cash flow and production. Average payout for these treatments was 9 days. A 30-well program using the CoalStim service resulted in an average incremental production of 66 MMcf of gas with an average treatment payout of 32 days, even at the low gas prices at the time. Two-thirds of the wells treated showed at least a 7% production increase.

In a recent field trial, the largest volume of H2O2 pumped into an oil and gas producing well was successfully pumped in La Plata County, Colo. for BP. It was the field-trial phase of a 2-year joint BP/Halliburton development effort. This is the first of a planned six-well pilot study to evaluate the technical and economic merits of H2O2 technology for coalbed methane production enhancement. More than 3,500 bbl of fluid was pumped including 100,000 gal of 3% H2O2. Additional field trials are slated for Chevron in the diatomite formations in California.

Composite bridge plug

Success in CBM development depends on efficient hydraulic fracturing of multiple coal seams. The seams may be commingled and fractured together or isolated to perform staged fracturing treatments. Halliburtons Fas Drill bridge plug is designed for completing multiple coal seams with staged zonal treatments. It provides flowback capabilities after treatment and reduces drill out time. The Fas Drill bridge plug is used much like a conventional permanent bridge plug and is available in standard and high-pressure/high-temperature models. In addition to multi-zone stimulation in coal beds, the tool can isolate a lower zone during squeeze cementing operations on land-based or offshore rigs in vertical or Fas Drill bridge plug deviated wells. Fas Drill bridge plugs can be set on tubing, drillpipe, coiled tubing, slickline or with electric wireline. It can be drilled out with conventional three-cone or junk-mill bits. To re-frac an old well in northwest Virginia to boost production from the upper coals without damaging the P-3 coal, a Fas Drill bridge plug was set to protect the lower coal. It was then drilled out and Cobra Frac service used to treat the upper coals using coiled tubing. After a successful treatment, the well showed a sustained production increase expected to last several years.

SandWedge service: CBM stimulation

Halliburtons SandWedge agent also can be a useful tool in CBM stimulation. It combines advanced proppant coating capability with a treatment design and proppant selection specific for each application.

Widespread results: Cobra Frac service

Halliburtons Cobra Frac service is especially effective in CBM development. These example jobs highlight its capabilities. ColoradoIn southeastern Colorado, CBM trapped in multiple seams has plagued operators for decades. Depth of a typical well is 3,500ft (1,068m) with up to 20 seams trapping gas. Until recently, the most popular technique, a velocity over accuracy approach, did not bring the best results. Now, the Cobra Frac service team is fracturing multiple seams in a single day, bringing more methane to market quicker and with less environmental impact. EnglandIn the United Kingdom, the objective was to complete an exploration program in multiple coal seams (between 10 and 14 per well) in a cost-effective and timely manner in a highly populated area. Using the Cobra Frac technology, five wells were completed with 53 individual fracture treatments, placing 3 million lb of sand accurately in all targeted seams.

An H2O2 study
Halliburtons hydrogen peroxide (H2O2) service, described more fully for a variety of applications in a previous chapter in this report, is a particularly effective tool for boosting CBM production.

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Shale

Control Fractures and Measure Results to Optimize Shale Gas Reservoir Performance
As part of the bundle of unconventional energy resources that also includes tight sands and coalbed methane, gas from shale can make a significant contribution to the global energy supply.

n its Natural Gas Outlook Through 2025 prepared in 2003, the U.S. Energy Information Administration (EIA) estimated technically recoverable U.S. natural gas resources at the beginning of 2002 were 1,289 Tcf. U.S. proved conventional gas reserves stood at only 183 Tcf; the largest share of the total resource is 445 Tcf of unconventional gas. The biggest share of that potential is from tight sandstones, but shale gas production will increase during the forecast period. According to the Gas Technology Institute, more than 37,000 U.S. wells produced shale gas in 2002, providing about 3% of total U.S. gas supply. Shale is a fine-grained sedimentary rock characterized by thin layers that break with an irregular curving fracture parallel to the bedding planes. Shale typically is deposited in slow moving water and is often found in lake and lagoon deposits, in river deltas, on floodplains and in offshore beach sands. Shale usually contains free gas and adsorbed gas. If the predominant production mechanism is by desorption, then a stimulation treatment should be designed to maximize total fracture surface area. If most of the gas is free gas stored in the microporosity and natural fractures, a high conductivity prop frac likely would be more effective.

Better large treatments

The low permeability of shale has driven stimulation design toward large volume water fracs, the most economical and practical way to stimulate gas shales to date. Volumes in excess of 100,000 bbl have been pumped on a single zone. Pumping this amount of water into a gas bearing formation, however, has its risks. Halliburtons ShaleStimSM process helps address some of the negative consequences associated with large volume water fracs. A complete family of products and services that helps enhance asset value throughout the shale reservoirs lifecycle includes:

Evaluation to provide total organic carbon content, shale maturity, Vitronite reflectance Ro, gas content in standard cubic feet per ton, free and adsorbed gas content; Log analysis to identify sweet spot productive areas using triple combo and sonic logs; Special fluids to aid frac design with fracture network length, width, height and micro-seismic evaluation; Simulators to provide reservoir simulation, production history matching and injection test analysis; and Chemistry for primary and remedial treating fluid and additive design. Production decline from fractured shale appears to have three distinct flow periods, each governed by multiple reservoir and completion factors. In the early period, frac spacing in the stimulated area and frac permeability are key criteria. During a middle flow period, fracture area extent is important, along with frac permeability. In the later period, unfractured area (drainage area), matrix permeability and frac spacing in the non-stimulated area all have an impact. Though proppant transport in thin fluids is not well understood, prop nodes, bed fluidization and the ability to move highdensity prop deposits through narrow slots and right angle turns have been demonstrated in lab experiments. Special fracturing fluids and processes are useful because shale is not characterized by single bi-wing fractures, but contains many parallel and orthogonal fracture wings. Empirical models have been generated for the Barnett shale using micro-seismic image data. Shale chemical treatments have several elements. Surface reactive fluid enhances the overall surface area conductivity; and surface modification agents help reduce fines migration, enhance fracture conductivity and help remove treatment water. A microemulsion also helps treatment water removal. Conductivity enhancement/endurance proppant additives improve and

November 2005

UNCONVENTIONALRESERVES 9

Shale

maintain fracture network conductivity during the production cycle. A specialized chemical formulation also is available for primary water frac clean-up and remedial treatment used to mitigate the impact of foreign chemicals and solids injected during a large volume water frac. These foreign materials can cause FracTrac TW service enables Halliburton and reactions between operator experts to work collaboratively to the fluids injected, monitor and advise on treatments. the rock face and the reservoir fluids. Scale, sludge and emulsions can form. Other problems can occur, including formation degradation, prop pack loss of conductivity and fines migration.

was deployed with coiled tubing in a 4 1/2-in., 1,600-ft (488-m) openhole horizontal section and eight fractures were placed in 5 hours; and in offshore Brazil, SurgiFrac boosted production from an offshore, openhole horizontal well with a pre-perforated liner by five-fold after three proppant fractures were placed using bauxite and resin-coated bauxite (16 to 20 mesh) in concentrations reaching 14 lb/gal.

Measurement improves the model

Fracture propagation is more complex and more difficult to predict than generally realized. However, with the growing emphasis on optimizing productivity and recovery, it also is more important than its been in the past. Halliburtons FracTrac TW technology can be tailored to reservoir requirements to better monitor fracturing treatments. This service makes it possible to see the rocks crack in real time in the active wellbore and use the data to help calibrate a fracturing model. FracTrac TW service places wireline-conveyed downhole tiltmeters in the treatment wellbore during a mini-frac treatment. The fracture mapping results are fed to the fracture modeling software on-site to help provide improved treatment design. FracTrac TW service can help make several treatment aspects more effective: verifying pay zone coverage by measuring fracture top, bottom and height; optimizing completion economics by right-sizing the fracture treatment; boosting reservoir productivity by increasing fracture length and helping verify effective pay zone coverage; and reducing cost and optimizing well spacing and well layout, often reducing the number of wells needed. Field provenIn central Oklahomas Hunton formation, New Dominion LLC was acid-fracturing wells, but the geometry of the acid fracs was not well understood. Formation parameters, including mechanical properties and acid reactivity, made it difficult to model the fracture geometry created. No nearby offset wells were available for tiltmeter or micro-seismic monitoring. The FracTrac TW service was used to measure fracture geometry from the active wellbore during a live acid frac treatment. Fracture height and width measurements were used with FracproPT* simulator to estimate fracture length. A maximum critical pumping rate was identified and its impact on fracture geometry defined for future design considerations. Potential economic value of the treatment was millions of dollars.
*Mark of Pinnacle Technologies

Proven fracture control

There is now a stimulation process consistently effective in low- to medium-permeability horizontal completions. Field performance of Halliburtons SurgiFrac service has shown it can provide precise control of fracture initiation and propagation in gas shale. The SurgiFrac service can provide important advantages: increase production by re-entering openhole horizontal wellbores with coiled tubing or jointed pipe and accurately placing fractures in bypassed and under-performing zones quickly and cost effectively; optimize reservoir drainage by precise location of fractures with a customized treatment; add new production quicker than with conventional fracturing by creating multiple fractures in the wellbore with no sealing, such as packers, required between zones; and reduce fracturing treatment costs by lowering tortuosity, resulting in less equipment and lower viscosity fluids. Putting slacker wells to workField results highlight the versatility and effectiveness of SurgiFrac service: in Canada, SurgiFrac service provided a six-fold production increase, turning a well with the lowest pre-treatment production rate of three wells into the best performer; in another case, production increased 800% after the service

10 UNCONVENTIONALRESERVES

November 2005

Tight Gas

Advanced Frac Fluids, Reliable Tools Help Get Most from Tight Gas Sands
Unconventional gas comes from three key sources: low-permeability sandstones and carbonates, coalbeds and gas shale. Currently, it accounts for about 7% of U.S. gas production.
ccording to the U.S. Energy Information Administrations Natural Gas Outlook 2025, prepared in 2003, more than 80% of the increase in unconventional gas production during the forecast period will come from tight gas sands. Production from these reservoirs is expected to more than double during the forecast period from 3.3 Tcf in 2001 to 6.8 Tcf in 2025. About half of the U.S. proved reserves in tight sands is located in the Rocky Mountains, but significant reserves exist in all other regions except the West Coast.

Many technologies, including high-efficiency frac fluids and lightweight mono-layer proppants, have proved their capability to enhance productivity and recovery from these reservoirs. Halliburton continues to enhance existing technologies and develop new tools to fully exploit these resources. Its arsenal of specialized tight gas technologies also includes Cobra Frac service.

Reliable well construction

In many wells, unsuccessful installation of liners and the failure of liner tops result from a variety of causes, including a lack of integrity in the liner top cement; pre-setting of the liner hanger and packer; failure to get the liner to depth; and failure of tools such as darts, plugs and running/setting tools. Current technology for running and setting mechanical equipment poses several risks, including multiple slips, tortuous flow paths, exposed hydraulic ports, potential leak paths and reduced radial clearance. But these risks can be minimized in many cases eliminated by applying new technology. The VersaFlexTM liner hanger system, for example, combines expandable solid liner hanger technology and Halliburtons complete range of cementing products and services. The system expands the capability and enhances the reliability of conventional liner installations. The heart of the system, the VersaFlex integral liner hanger/packer, is made up of an integral tieback receptacle above or below (depending on system size) an expandable solid hanger body. Elastomeric elements bonded to the hanger body are compressed in the annulus as the hanger body is expanded. This virtually eliminates the liner hanger/casing annulus and provides liner top pressure integrity as well as high tensile and compressive load capacity. The VersaFlex liner system provides: simplicityno moving parts, slips or cages to suspend the liner in the support casing, eliminating the risk of pre-setting the liner hanger/packer;

VersaFlex liner hanger system running sequence.

November 2005

UNCONVENTIONALRESERVES 11

Tight Gas

reliabilitymultiple redundant elastomeric elements maintain pressure integrity while virtually eliminating gas migration paths in the liner top; integritythe reduced outer diameter (OD) of the hanger body allows for higher circulation rates during cementing to improve cement integrity and minimize cement pack-off potential; versatilityVersaFlex systems soon will be available in virtually all common liner/casing configurations; and adaptabilitythe liner hanger/packer can be combined with existing Halliburton completion products to provide a liner top completion solution. While hangers with slips and cones provide a trap for cuttings and debris to pack off and increase equivalent circulating density, the slick OD of the VersaFlex system reduces the risk of lost circulation. The system also avoids a stuck setting tool, the most common causes of which are debris entering the setting tool/extension sleeve gap and incorrect tool assembly. In the VersaFlex system, the liner top is completely sealed to keep out fines, cuttings and other well debris; the hanger and setting tool assembly will not make up if incorrectly assembled. The system can only be set by following the proper setting sequence to avoid presetting the hanger or packer by catching slips or packer elements and by the surge effect when running in the hole. There are no exposed hydraulic ports. Anadarko Petroleum Corp. recently chose the system for a 13,549-ft (4,133-m) well being drilled in Madison County, Texas. The liner was run in the hole until it got stuck at 13,386ft (4,083m). Freeing it required a total pull of 465,000 lb (260,000 lb over pick-up weight). During pumping, the hole packed off several times, creating a maximum pressure of 4,500psi on the drillpipe. Only when the pump rate was increased to 10.5 bbl/min and the liner was rotated at 80 rpm with torque between 8,500 ft-lb and 14,500 ft-lb did the liner begin to move. It took 25 hours of washing and reaming to achieve total depth. After setting the hanger, a 300,000-lb pull test and 4,200psi positive pressure test with no pressure loss confirmed the hanger was set. Anadarko representatives on location were quoted as saying, No one elses equipment could have stood up to that kind of abuse and still set or tested. Anadarko has since utilized the VersaFlex liner system in several of its wells.

bridge plug or tubing anchor in a pumping application. The packer is a useful tool in any well that requires it to be lubricated into the well under pressure with a plug in place, minimizing damage to sensitive formations. It can be released, moved and re-set mechanically on tubing. Rated at 10,000psi with full bore inside diameter for most tubing/ casing combinations, it easily converts to wireline set or mechanical set in the field. An opposing slip design holds in both directions and is operated with a simple quarter-turn J-slot. A temporary plug may be installed at the top of packer. Mechanically re-settable, it has an internal bypass and emergency shear release.

Solution: Miscible fluids

Introducing a water-based fracturing fluid into a low-permeability reservoir can lower the effective frac half-length because of phase trapping associated with the retention of the water-based fluid in the formation. The problem is magnified by the water-wet nature of most tight gas reservoirs where no liquid hydrocarbon saturation has been present. Retention of this increased water saturation in the pore system can restrict the flow of methane. Capillary pressures can be several thousand pounds per inch in low permeability formations at low water saturation levels, making it impossible to generate sufficient capillary drawdown force. The result is extended fluid recovery times or permanent loss of effective fracture half-length. Use of water in reservoirs with low saturation also may reduce permeability and associated gas flow by permanently increasing water saturation. These effects of fracturing fluid retention on gas flow in the fracture face can be as important a consideration as fracture conductivity when designing a treatment. It is possible to have a conductive fracture with good half-length in the desired productive zone and still not obtain optimum even economic production rates if phase trapping or relative permeability effects are restricting flow. Dont use waterHalliburtons MISCO2GasSM service is designed to mitigate phase trapping by using oil-based fracturing fluids. The system can recover the fluid easier because of increased volatility over diesel. Treatment safety is enhanced because MISCO2-Gas is a clear, clean, colorless fluid with no solids or additives

A versatile retrievable packer

The Halliburton Versa-Set wireline or tubing-set packer is a single-bore retrievable packer ideal for medium- to high-pressure environments. It is used for testing, injection and zone stimulation, and can serve as a production packer, temporary

Versa-Set Packer

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November 2005

Tight Gas

low friction pressures; effective leak-off control; positive proppant transport; compatible with 50% CO2; immediate cross-linking; absence of chlorides that may promote organic chloride formation; and compatibility with curable resin-coated proppant.

Restoring permeability
MISCO Frac service uses a CO miscible fluid system especially suited
2 2

for low-pressure and/or water-sensitive gas reservoirs.

that unloads by itself much like shaking up a can of soda and popping the cap. The service uses a hydrocarbon-based fracturing fluid system designed for gas well stimulation, a mixture of 50 vol% GasFracTM fluid and 50 vol% carbon dioxide (CO2) in combination with a 100% CO2 pre-pad. The CO2 is fully soluble in the GasFrac fluid while pumping, forming a single-phase fully miscible mixture. It is not a foamed fluid, but is gelled by adding a cross-linked viscoelastic surfactant. The frac fluid is diluted at the wellhead by addition of CO2 liquid, which dissolves into it. Cross-linked surfactant gel technology provides an efficient fracturing fluid with positive proppant transport and leak-off control that can generate an effective frac half-length. The fluid system is not adversely affected by shear, ensuring the desired fluid rheology is delivered regardless of shear history through surface pumping equipment, tubulars and perforations. Stable to 275F (135C), MISCO2-Gas service can effectively treat reservoirs with bottomhole temperatures to 325F (163C) by taking advantage of the cooling effects provided by the 100% CO2 pre-pad and gelled pad. Viscosity can easily be adjusted during the treatment, and the 1:1 application ratio allows quick and accurate visual checks on amounts pumped. More production faster Halliburtons MISCO2 Frac service is similar to MISCO2-Gas but uses a different fluid system. The MISCO2 Frac CO2-miscible gelled oil system uses new surfactant gel technology with up to 50% CO2 for stimulation treatments that provide high fracture conductivity with rapid load-fluid recovery. The result is more production faster. An additional benefit is that treatment fluid returns may be reused or sold as oil after processing, and disposal problems associated with treatment water or methanol are eliminated. The systems benefits include: regained permeability and fracture conductivity;

Halliburtons Pulsonix technology uses alternating bursts of fluid to create pulsating pressure waves within the wellbore and formation fluids. These pressure waves can break up many types of near-wellbore damage, helping restore and enhance the permeability of the perforations and surrounding area. Fluidic oscillation helps remove damage instead of breaking through it, cleaning the entire interval, not just the open sections. Pulsonix TF service, the next-generation process for treating near-wellbore and perforation damage, uses tuned frequency (TF) technology to customize amplitudes and frequencies for each application. The service incorporates Halliburtons coiled tubing expertise with its proven fluidic oscillator technology. Pulsonix TF is applicable for a variety of vertical and New Pulsonix TF tool is equipped horizontal wells, both openwith side and bottom parts for hole and cased hole. It permore direct impingement on performs well in removing forations. deposits scale, formation fines, paraffin, asphaltene, emulsions and more from the near-wellbore area, perforations and screens. Side and bottom ports enable direct impingement on perforations, and the process can function at low flow rates. The service can be used: to enhance placement and effectiveness of treatment fluids; for primary stimulation of high permeability formations; for preparation prior to stimulation treatments, gravel packing or frac packing; to clean out fill from openhole or casing; to change injection profiles; and for correct placement of treating chemicals.

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UNCONVENTIONALRESERVES 13

Heavy Oil

Well and Fluid Placement, Monitoring Help Optimize Heavy Oil Recovery
The heavy oil resource is large, but its contribution to supply so far has been modest. As lighter crudes become scarcer and harder to find, however, they will make up a declining share of the global oil supply and heavy oil will have to take up the slack.

arly heavy oil discoveries were usually the disappointing result of the search for lighter oil. If economically viable, these reservoirs were produced using conventional production methods. To produce most heavy oil, however, its viscosity must be reduced and additional energy introduced into the reservoir. Steam, injected in cycles or continuously, is one of the most practical solutions. As with conventional crude, the lighter heavy oil reservoirs are being targeted first. According to the U.S. Geological Survey (USGS), about two-thirds of heavy oil production is lighter than 15 American Petroleum Institute (API) gravity, but half the heavy oil that is technically recoverable is denser than 15 API. The USGS defines conventional oil as crude with an API gravity of at least 22 and a viscosity less than 100 centipoises (cP). Halliburtons Sperry Drilling Services can field a range of solutions to meet the challenges of heavy oil development, including advanced tools and expertise for directional drilling, horizontal drilling, formation evaluation-whiledrilling, and multilateral drilling and completion. Among these specialized tools are: ABITM (at-bit inclination) technology that measures inclination at the bit, rather than several meters away, making it possible to keep the bit in the pay zone. It can reduce the need to plug back and side track, and results in a smoother wellbore. It is especially useful in providing more consistent separation in steam-assisted gravity drainage (SAGD) well pairs; PWD (pressure-while-drilling) capability allows the measurement of temperature, and annular and bore pressure to help avoid lost circulation, detect and monitor flows and kicks, improve hole cleaning, monitor the fluid system and optimize drilling practices; AcoustiCaliperTM, a tool to accurately measure borehole diameter during drilling to provide quality control for measurement-while-drilling (MWD) logs and maximum horizontal stress field orientation;

INSITE (integrated system for information technology and engineering), a system to acquire and store data from any combination of downhole tools, rig sensors and third-party systems and to send rig site information to any desktop on a standard platform; and SperryRite Advanced Reservoir Drainage Services (multilateral technology) increases production capability and reduces overall field development costs by utilizing complex drainage architecture to increase the amount of reservoir exposure.

More contact means more oil

Achieving maximum reservoir exposure is doubly important when exploiting heavy oil resources. In Venezuelas Zuata field in the Orinoco heavy oil region, Sperrys LatchRite multilateral system demonstrated how increasing reservoir contact could maximize production rates. A typical horizontal well there has 9 5/8-in. casing set between 2,000ft and 2,500ft (610m and 763m), then a horizontal 8 1 /2-in. hole is drilled between 6,000ft and 9,000ft (1,830m and 2,745m). As the well construction program evolved from single lateral wells to complex multilaterals, production rates continued to improve.

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Heavy Oil

In addition to dramatically increasing productivity, the multilateral technology significantly reduced surface footprint, which is usually a challenge in exploiting hard to produce unconventional resources. In Zuata, gull wing wells reduced drilling pad cost and environmental impact. Continued improvementThe unconsolidated sand between 1,700ft and 2,350ft (519m and 717m) in Zuata has a porosity between 30% and 35% and permeability between 1 Darcy to 17 Darcies. The challenge is the oils API gravity between 8.4 and 10 and a live viscosity between 1,200 cP and 2,500 cP. Reservoir pressure is between 630psi and 895psi. By 1998, 86 single lateral wells were drilled in the field, and the longer laterals produced at higher rates. After 24 months, wells with laterals less than 610ft (186m) produced less than 300,000 bbl per active well, while laterals between 1,200ft and 1,500ft (366m and 458m) long produced about 800,000 bbl per active well. When two fishbone wells were drilled, they produced at rates even higher than the single lateral wells. Then a multilateral well design was introduced. In one well, a stacked dual-lateral fishbone completion, a total of 33,745ft (10,292m), was drilled, exposing 19,404ft (5,918m) of net pay. A crows foot triple lateral well, a total of 26,424ft (8,059m), was drilled exposing 18,785ft (5,729m) of net pay. Multilaterals in a gull wing step-out pattern were completed to maximize field drainage from 2001 to 2004. Tailoring multilateral wells to geology, several wells were drilled from single pads. Four wells, for example, drilled from one pad, totaled 53,827ft (16,417m) and exposed 43,693ft (13,326m) of net pay. Based on 23 multilateral wells and 108 single-lateral wells, productivity of the multilateral wells peaked at about 50% higher than the single laterals and maintained a higher production for a longer period. Relative cost of the different well designs, based on 1.00 for a single lateral, were 1.18 for a fishbone with nine ribs; 1.58 for a stacked dual lateral; 1.67 for a gull wing dual lateral; and 2.54 for a crows foot triple lateral.

The study concluded that variability in injection/production well separation, vertical and axial, impaired inter-well heat communication and delayed steam chamber development over the full horizontal well length. Better well placementTechnology, developed by Sperry and Vector Magnetics, is available to dramatically reduce the uncertainty in placing SAGD wells. The technology combines Vectors ranging technology and expertise with Sperrys MWD technology and directional drilling expertise. In the passive magnetic method, the dipole effect is created by casing magnetization and measured by MWD tools. Active magnetic ranging is the precise measurement of distance and direction between two or more wellbores. It is done by using magnetic field sources of known strength and orientation rather than by measuring residual magnetism from a casing string. In Sperrys active magnetic ranging system, the MGTTM magnetic guidance tool generates a magnetic field read with MWD. Active ranging allows flexibility in the design of well geometry/production configurations and is ideal for heavy oil SAGD applications. For SAGD twin well drilling, the MGT tool is pumped down the producing well. Its electromagnetic field is measured by an MWD probe in the injection well. The SWGTM single wire guidance tool is used for close proximity drilling and executing planned well intersections. A known amount of current is applied to a wire in a well to be avoided. The distance and sensor orientation can be calculated by measuring the change in magnetic field strength in the well being drilled.

Better measurements
Sperry developed the industrys first while-drilling magnetic resonance imaging logging tool, the MRIL-WDTM sensor, to provide a direct measurement of reservoir total porosity while drilling. The measurement makes it possible to separate pore fluids into moveable fluids as well as capillary and claybound water, and indicates permeability. It also can help discern hydrocarbon types. The primary applications for the MRIL-WD tool are in high-cost offshore exploration and development wells where advanced reservoir characterization has been to directly determine hydrocarbon volumes, net permeability feet and hydrocarbon type. The tool helps avoid problems associated with obtaining wireline data and the considerable amount of rig time required. The technology is especially valuable for comprehensive reservoir evaluation from logging-while-drilling (LWD) data in high-angle and horizontal wells. The tool can operate for up to 200 hours on a single battery pack. When combined with the EWR-PHASE 4TM resistivity

Improving SAGD efficiency

A key development scheme for heavy oil is SAGD in which two parallel horizontal holes are drilled. Steam is injected in the upper hole, oil is produced from the lower. Maintaining the proper distance between the two is critical to efficient production, but uncertainty about the relative position of the holes historically has plagued the operation. A Shell Canada Ltd. SAGD experimental project in 1997 confirmed the importance of accurately placing these wells.

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Heavy Oil

sensor, the MRIL-WD sensor data can provide all the information necessary for complete evaluation of the reservoir fluids and porosity. Where real-time data are needed or when economic considerations favor LWD, the MRIL-WD service provides the same high-quality information as the first- and second-generation wireline MRIL services. MRIL-WD can also be combined with Sperrys Stellar MWD/LWD sensors. Traditional porosity devices are affected by rock matrix changes, but the MRIL-WD tool can be used in complex or mixed lithology sequences to measure porosity independent of lithology. High temperature reliabilityAccurate, reliable data are key to managing a reservoir for the best recovery and lifecycle asset performance. Halliburton has developed the EZGaugeTM system as a cost-effective, accurate pressure data collection system free of downhole electronics. The reliability and longevity of the system is significantly greater than most monitoring technologies. Designed to reduce cost, improve reliability and extend longevity, it can be used in downhole temperatures up to 800F (426C). In addition to replacing downhole electronics with a pressure sensor that is not affected by harsh conditions, electronics and system accuracy can be checked without well intervention. Pressure acquisition systems are interchangeable and the pressure transducer can be calibrated at any time. Through a series of chamber checks and purge techniques, system function can be validated. Flexibility of the EZGauge system allows the pressure system to run with distributed temperature systems as retrievable, permanent or semipermanent. The downhole chamber and sensing point can be installed in a number of different ways. The chamber and capillary tubing can be installed permanently by incorporating them into the casing. Temporary darts isolate the chamber while the casing is run and cemented in place. EZ-Gauge Permanent Pressure The downhole chamber can also be built into the Monitoring System

production string and placed above or below packer arrangements for monitoring annulus or tubing pressure. For short-term applications, the chamber is attached to the end of a capillary tube that can be run in the well similar to wireline. The surface instrumentation available ranges from basic pressure readouts to advanced data acquisition devices with memory and real-time telemetry capabilities. Field provenAs of mid 2005, more than 1,300 permanent EZ-Gauge systems had been installed and more than 2,400 retrievable systems used. The deepest installation to date is 22,000ft (6,710m). In 2002, the first combination EZ-Gauge and fiber optic-based distributed temperature system (OptoLog DTS) was installed. The oldest installation still working today is 22-years old. Recently, Petrobras in Brazil selected the EZ-Gauge technology after performing two direct comparisons with quartz electronic memory gauges. And Japan Vietnam Petroleum Company Ltd. selected the EZ-Gauge system for a unique and heterogeneous reservoir type fractured granite basement which has temperatures up to 312F (155C). Offshore California, an operator needed a bottomhole pressure monitoring system to optimize gas lift and diluent injection and provide reservoir performance monitoring in a harsh 12,000-ft highly deviated wellbore in water depths up to 1,200-ft. The EZGauge permanent pressure monitoring system delivered data in real-time to the desktop of the asset team and is used on a daily basis to help manage the reservoirs.

Finding steam breakthrough

Steam breakthrough in heavy oil wells can be a problem, and the offending zone must quickly be identified. Not only can production drop dramatically, but failure can result in holes cut in tubulars, screens and casing. Many of these events can result in loss of the borehole. Several approaches to identifying breakthroughs have been tried, including produced-well temperature, pulsedneutron logging and drilling observation wells to monitor zonal temperatures. A more accurate and cost-effective method is to install optical fibers for distributed temperature sensing (DTS). Induced wellbore temperature transients, triggered by water injection, can be recorded by fiber-optic DTS technology, allowing exact entry points of fluid more specifically, the entry of steam to be identified. Quick snapshots of the total wellbore temperature is the only way to see the well cool and quickly heat back up after the water-injection process, according to the authors of SPE Paper No. 87631, Identification of Steam Breakthrough Intervals with DTS Technology.

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Heavy Oil

Fluid from sands with steam breakthrough tends to be more mobile and contribute most to wellbore inflow immediately after the water-injection phase, the authors said. Rapid recording of full wellbore temperature profiles, possible only with DTS technology, is required to see many of the breakthrough intervals. This application is not possible with any other temperature-logging technique.

Producing fluid levels, pump or motor heat generation, as well as annular fluid column height and gas injection entry points for gas lift installations, also can be monitored and integrated into control systems to optimize performance. An OptoLog DTS system can be installed in a wellbore strapped to the casing and cemented in place; strapped to the tubing and terminated above or below a packer system; or run temporarily into a well with a wireline. Measurements from the OptoLog DTS system can be utilized with Halliburtons iFlow analysis software to yield critical reservoir performance information such as identification of fluid entry points and quantification of inflow from individual zones. Real-time OptoLog DTS monitoring and subsequent iFlow analysis can be utilized in producers, injectors and even observation wells to make critical decisions for optimal performance of the reservoir. The OptoLog DTS system is ideally suited for both geothermal and steam flood wells. A niche application is the use of the OptoLog DTS in an intelligent well completion as a reservoir management tool.

Improved fluid placement

Halliburtons DeepWaveSM service is a coiled-tubingdeployed placement technology for improving chemical treatments such as matrix acidizing, scale inhibition, remedial sand/proppant control and conformance. It provides better fluid placement and helps improve production through wave generation and pore scale dispersion. The technology uses large amplitude, low frequency downhole pulsing to enhance the flow of fluids in porous media. The mechanism involves generation of porosity dilation waves and pressure effects. Porosity dilation forces fluids into normally unoccupied pore spaces under influence of pressure waves. The effect is more attributable to fluid wave propagation and pore dilation than rock movement. DeepWave improves production over standard pumpand-treat techniques by: enhancing chemical treatment results through deeper placement; providing pinpoint placement of chemical treatments without zonal isolation; and creating new flow paths of permeability through a combination of forced fluid injection and pore scale dispersion. In test cells representing an oil-filled reservoir, a representation of flood water or formation treatment fluid such as acid had longer fingers penetrating and displacing the oil faster and deeper when pulsing. After 138 seconds, pulsing had resulted in more than twice the penetration distance.

The OptoLog DTS system identifies steam breakthrough zone while monitoring the well.

Halliburtons OptoLog DTS temperature monitoring system applies fiber optic technology for permanent monitoring, a step-change in the ability to manage reservoirs, wellbores and completions. The optical fiber-based sensor allows continuous temperature profiles along the entire well at userselected time intervals. For real-time production profiles, it can identify fluid entry points, gas or water breakthrough locations and fluid crossflow. It can continuously quantify production rates by zone and can be used in SmartWell completions as a monitoring and management tool. OptoLog DTS is especially useful in real-time steam flood management where it can monitor steam movement toward producing wells. In addition to signaling needed modifications at the producer or injector to improve recovery, it can pinpoint steam breakthrough zones using DTS plus a wellbore cool down procedure. The fiber optic-based DTS is placed in the wellbore in a permanent or temporary configuration. The wellbore is cooled by injecting a non-damaging liquid from the surface. Once the temperature in the well is stable, injection is halted and distributed temperature is monitored to identify steam breakthrough locations.

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Coal fines can clog the proppant pack of your fractured CBM well and
cut into your production and your cash flow. CoalStim service pushes
SM

Its just coal dust. But something that small can kill CBM production.

back those fines, locks them out of the proppant, and creates open flow channels for the gas. The result: CoalStim service can not only restore your production but even increase it. And its extremely cost-effective with payback in as little as 3 days. CoalStim service has proved its value in over 1000 treatments. Its water-based and environmentally enhanced. Available only from Halliburton. Halliburton has the energy to help. To learn more about how CoalStim service can keep the channels open so the money flows, contact your Halliburton representative or visit www.halliburton.com. Unleash the energy.

HALLIBURTON
Production Optimization

2005 Halliburton. All rights reserved.