Study Management Introduction A number of issues related to sieulations are not directly technical, These are grouped in this last chapter of Part |. The issues are significant. The areas covered are as follows: many reservoir engineers will be interested in the issues associated with the management of a study. How does one choose @ consultant? What results are expected? The author has included a Simulation involves much input,and, frequent ly.the quality of a simulation is only as good as the confidence the people who use it fave in the study More importantly success in corpora tions often has to do with communication ~ skills. hat issue is addressed in this chapter. Good communication skitls help improve the quality of an engineer's work, A short section is included sefect software Many reservoir engineers will not actually per form a reservoir simulation study. Due to the spe- cialized nature of this type of work,such studies are often contracted out to a third party or per formed by a different department. Thererore, how eer checklist in Appendix B that may seem like a review of previous material in this text. It is; how- ever reversing this process requires some thought. Having a separate procedure to check off a study can be helpful Reservoir simulation is technically complex, and. itis easy to get lost in the details. One section is dedicated to identifying problem areas and.in particular, where simulators are weak. The mate- rial in this chapter is wellknown to reserves evaluation engineers, where the emphasis is heavily oriented to historical data and analogy This provides important balance in the report ing of simulation eesuitsn Practical Resarvair Simulation Reports Communication The true value of work performed must include beth @ communication factor and a knowledge retention factor, To maximize these two factors requires format presentation of results at the end of the project a clearly documented and readable report. Sulficient detail must be present to enable one (or one’s successor) to continue the project at a future date In the job ads of the locat paper, Me Employer invai ably asks for superior communication skis This applies to both oral presentations and writen study results. A common philosophy has been to take for granted that the work is done correctly and a minimalist approach to documentation is appropriate, Le., only the important results need to be presented. Some people have suggested the details would bore expert readers and it would detract from the report The author’s experience is exactly the opposite. If the reader really knows the subject, a thorough, wellvritten report provides reassurance the report was prepared using a high level of detailed information and a thorough background. In most cases, silence on issues will raise suspicions in the expert's mind rather than reassure him or her. This author suspects a minimalist report covers ‘gaps in knowledge, and all the correct material will be ignored, Restated, experts normally feel compelled to check everything has been done correctly. This is particularly clear in government hearings, where undocumented work is automatically seen as a ching in the armor and usually results in re-creating the results, Frequently, this leads to detailed questions in the form of Information Requests, which can be very detailed Itis easy to say. if there are questions, people will sim- ply ask, Again, the author’ experience is not consistent with this In most cases, if the reader of a report does not know, he or she is more likely to remain silent than admit ignorance. The less people understand your report, the ‘more silent and suspicious they are likely to be. Complete documentation is not aluxury—tis essential pte Quality Reservoir simulation studies vary in. quality: Some simulation stuces give correct results, and some ae total ly misicading A wnonaty posed study’ or incorrectly run Simltion ea actually result in the wrong implementa tiot ot a reservoir depletion strategy Lost opporturities in these cases can cost millions of dollars and great exceed the vost of he studs The most important differences between high: and lowaualty studies are: accurate reservoir description proper layering, and comprehensive checking of input and output data. Most predictions should be checked against otfset analogues. Iti quite possible studies ae not implemented correctly, an inappropriate simula- tion technique is sed Evaluations report During the past 15 years, improved quality of reports isthe wend in the evaluations sector More than a decade ago, it was sufficient to provide a propery-by:-property computer output of economics plus a summary table, A moder evaluation report now includes a descriptive writeup and a comprehensive listing of assumptions, Ths provides two main benefits: It gives a technical overview of the property. Not everyone who uses evaluation reports has a tech: nical background, and the overview provides use ful information to many readers. It provides the expert reader an accurate appreci- ation of the assumptions used. Tis allows more accurate risk assessment—without having to repeat the evaluation ‘To date, this does not appear to be true south of the 39th parallel (the border between Western Canada and the United States). Most information there is propri- ‘etary, so itis harder to obtain. Success in the US. mar ket will also strongly correspond to having a wide client base. The reports are normally based on knowl ‘edge gained from multiple operators. However, each individual company does not intend to share its data with other offset operators.A corporate evaluation represents years of exploration and development for a company, In this sector, its often taken asa given that the manner in which the materia is resented to financial institutions affects the perception, tof the company: For this reason, evaluation reports seem to have a better finish than most technical report, Without doubt, the finish on a report affects others perception of a simulation study Approach The general elements that should be in a report are as follows Comprehensively prepared reservoir descrip- tions. The first sep is a good understanding of the depositional environment, Normally. detailed layering calculations are required. This involves specifying either the correct layers or the correct development of pseudo relative permeability curves. Checks against offset information. This aids in identifying critical modeling parameters, Frequently unrepresentative models can be weeded out by compari- son to offsetting production A reasonable review of reservoir performance. This includes a description of decline trends, water rates, and GORs, including other informa- tion, such as DSTs, pressure buildup analyses, pressure surveys, and material balance studies. A copy of the basic data input deck. There is no other method of reproducing the resus in the future without this information. It should also describe how the data was screened and why particular data was either kept or rejected. Arrun-by-run history match log.This isa positive sign of a wellthoughtout strategy.A description of the logic used ir history matching is even more important. The changes should be described so the reader will know what decisions and. assumptions were made Results displayed graphically. Graphic display allows rapid assimilation of the results and. provides a vital quality-control check. Itis easy to spot the cost on consultants’ reports, since. unlike salaries, they are usually approved separately However, if a significant amount of time is spent trying to Study Management determine exactly what the consultant did, expense in time and real money that could have been saved with a better report The author includes a basic description of the tech- hniques used. It is easy to assume the reader is familiar with simulation techniques; however, not everyone has studied simulation or done the research. At ARE, we cut and paste these segments from previous reports and do not have to re-create them from scratch for every report Self-improvement One supervisor in the author's experience taught good report writing. The supervisor had worked as an evaluations consultant for an industry-leading firm, and he earned a reputation for being demanding, Writing reports is difficult; one has to tie everything together, Inconsistencies become much more obvious in a writ ten report. Writing is as mach a process as an end in itself, and the writing process makes the quality of the work better It people say writing the report will not add value, they are wrong, Itis easy to make up excuses to avoid writing reports. The writing process One of the biggest problems is the expectation one can sit down and write a letter ora report from the begin: ning to the end correctly the fist time. This is the same as the admonishments that history matching can be done automatically as efficiently as possible. In reality Many writers find it helpful to plan and organize their report by writing an outline, In some cases, the outline in point form can be directly expanded to full text. This is the classical approach, which is normally taught. Others know the general outine,and do not spend a lot of time on this stage. Consequently they don’t find this methodology helpful. In the first drat put down al the ideas in any way possible Some people write at this stage as if explaining to a friend. Don't worry about the order just write down as much as possible. Realistically one is doing a significant amount of simulation then the time spent using a comput er justifies learning typing by touch. Word proces Sors make it easy to rearrange repor text. Make at least one serious edit and rewrite. More likely two or perhaps three revisions will be necessaryPractical Reservoir Simulation Give the edited report to someone to proofread for you. Having a professional technical editor do. this is worth the money in many cases. Some large companies have techaical writers who can do this, Make final corrections, and then read it again. Many people are turned away from the writing process bevause they have unreasonable expectations of what is required. Outline ARE uses a standard outline for reports that follows, this general theme: 1. Title Page 2. Table of Contests 3. Cover Letter 4. Introduction 5. Summary 6. Conclusions 7. Recommendations 8. Geological Review 9, Production Performance Review 10. Pressure Transient Review 11, BOS Tuning 12, Model Construction 13. Grid Refinement or Single-Well Modeling 14, CrossSectional Modeling 15, History Matching 16. Predictions 17, Report Preparation 18, References 19, Appendices Most reports follow a similar theme, with varying degrees of detail Graphical output Graphs are important, They convey information quickly The majority of simulation engineers seem to pre- ferlinear rate versus ime plots to semilog rate versus time plots Evaluation engineers usually prefer the late, since they commonly use decline analysis. In order for one’s experience base to have its full impact, the results of the study should be plotted in the format to which one is accustomed. The author strongly recommends the ase of, semilog production plots 275 « The predictive phase and the history-mnatch phase of a studly are usually performed at different times using a sep. arate computer run, Often, thehistory-match plot and the prediction are not plotted togeter. A combined plot can be very informative. Plotting the prediction and history match on consistent plots for individual wells is recom. mended, The plotting routines available in the post processor will not always allow ope tw do everthing. Do ‘not hesitate to use a spreadsheet tomake custom graphs, Large output The author produces many larye inaps and ourputs Many people do not realize itis easy to paste up a large diagram on a sheet of paper from a flip pad. Paste on text from the word processor using a label sheet. Send this to your local oil patch printer, such as Petto-Tech or Riley, and they will photocopy a vellum. It costs less than $10.00, and they can accommodate large sheets. Blue line or black line prints can be made in. age quantities for limited costs What parts of simulator output are believable? leis partly in the nature of people who are attracted to simulation to be strong technically and analyically. (tis difficult to state in a report, “Oh, by the way. there are some big parts of this simulation output that are eally not accurate” A pet peeve in this regard is gas injection which is discussed later in this chapter. In many cases, reports have had absolutely no qualifiers or caveats in| this regard, Itis the responsibility of the simulation engineer to point out limitations. For people who are strong analyti cally, itis often contrary to their value system to Geni- grate what is really, in other applications, a useful too Itis hard to write something critical of one's own work Here is a suggested solution—stick to the facts, For example, “The cases presented involving gas injection represent an optimistic prediction of performance Factors not included in the simulator include viscous fingering, large mobility ratios How does the simulation engineer correct for the things the simulator cannot do? One has to put aside the simulation documentation and took at practical experi fence. One can be definite in saying, “The average recov ry in all horizontal gas floods implemented in the Province of Alberta is X.X%, which is 10% of the WY% pre= dicted ia this simulation model.”Management is paying. in part, for the engineers opin- ion, This is probably an ethical requirement if one i a licensed engineer ‘There is nothing wrong with stating an ‘opinion, eg. lm my judgment ihe recovery will be Z 2%, which is above/betou the average projected recovery for the Province of Alberta because this reservoir is bewer/worse than the average reservoir in the following respects: This is an example where knowledge restricted to sim- ulation alone is extremely dangerous. It is 9 concern to the author when individuals call themselves simulation engineers as opposed fo reservoir engineers who happen to do simulation. Summary . Producing output requires a great deal of creativity Many people will give the job to a secretary to mudale through. The author looks at the success of a study as a Study Mamagement Ieo-part score: The score is calculated by technical qual: ity multiplied by presentation quality. It one does a mediocre job technically and an excellent job of present- ing the results: the score equals 0.55 «0.9 or 0.95, #fone is brilliant technically but does an abysmal presentation, then the score is 09 x 0.28 or 0.252. The mediocre tects nician with a qualey presentation appears to be twice as knowledgeable as someone who is technically briliant Remember. the objective is for people reading the report {ihe boss and, in particular his boss) to assimilate results quickly and in a manner that will give them confidence. ‘Those reading your report are not always experts in simu: lation. It is appropriate to explain exactly how and why the study was conducted. Other readers may not be sim- ulation experts, and a clear explanation of the limitations ‘of simulation belongs in the simulation report. Choosing Simulation Software and Hardware Alter one reads a text on reservoir simulation, some- cone will likely decide the reader should be involved in choosing software, An engineer may be asked to analyze simulation software for acquisition by their company. The software will be used by both company and outside per- sonnel (contractors). Likely, one will be hiring peopie who must have the technical skills and resources to accomplish the company’s needs ‘The main issues it acquiring software are as follows: + technical capability + ease of use hardware requirements market penetration client/corporate/partner programs service record (help desk and customer support) Proximity of service Jn some ot these issues, there will be fundamental tradeotts. For instance, technical capability always con- flicts with ease of use. Other issues, stich as market pene- tration and service, often go hand in hand—but not nec- essarily. With larger market penetration, service should be better and more widely available. There is rarely unique answer. The objective is to find the right balance of these factors forthe individuals and the business Some main sources of software ate listed as follows: software companies research organizations (government and industry) + integrated consulting companies seldeveloped ‘The following sections expand on the advantages and disadvantages of these sources. Software companies This is normally 4 good source of software, The soft- ware tends to be well-written, since this is their primary business. One of the reasons PCs are so powerful is much of the software is writen by specialists for specific pur- poses. Either companies in this category produce good ‘uality sofeware or they go out of business. One problem with software companies, particularly those in the technical area and reservoir engineering soft ‘wate in particular, i their pricing is not based on the size >aPractical Reservoir Simulation Of the user base, This reflects the domination of their per ceived market—large oil companies. Asa result, many of these companies set their purchase price at the same level for a one-man consulting company as they do for the worlds largest integrated producer. There is no price diflerentiaion for hundreds of users versus a single user From a commonsense point of view, this situation seems ludicrous. However itis true in many situations PCs have had the advantage that the shrink-wrap mar keting approach automatically produces a product dlesigned to be priced on a per userfmachine basis. This is fair enough for operating systems, word processors. and spreadstieets, The extensive use of networks means many compa nies often buy a few copies to cover active users rather than the total numbér of «machines. This sometimes means loading times for software are slow because they come across the network, Italso means some of the more expensive data programs are not really singles licenses but rather distributed licenses, Many software companies have difficulty understanding wiy a two or three person consulting firm, where the software is installed on one machine, is reluctant to pay the same amount as a com- pany with 50 technical people using a network. ‘One approach to providing software to smaller cus: tomersis to strip off capability but this approach does not address the issue of usage level completely. In running a smaller consulting company, ARE. works on and solves problems as difficult, and often more difficutt, as almost any oil company or large consulting company. It appears oil companies often elect to have someone else work on long, involved technical projects Some software companies have developed strategic relations with consulting companies. [n one situation for economic evaluations, a consulting company and the software company teamed up. This produced efficient and useroriented software that dominated the market for more than a decade. {n addition to product capabilities and support, look {or three things in a software company: What is their level of customer sensitivity? Do they have a realistic pricing schedule? Have they capitalized on strategic relations? 28 « Research organizations There are a number of goverament and private research organizations. This cant be an excellent Source of software. In general, they are happy’ to have as many Users as possible, In areas where development is impor: tant, this can be a particularly good source of software. The biggest concern with research organizationsis the lack of ease of use of their software or user friendliness Historically, some of this software was dificult to use, For this reason, test the software befire making a commit: ment. Ii one is a relatively advanced user. this may not presenta problems, Iftime is limited or one isnot inclined to work with an unfriendly programm, another source of software may be more suitable. In general, the level of technical capabilities—if not user friendtiness—of research organization software is pleasantly surprising In a number of cases, the government has supported the development of programs that were not freely avail able to al sizes of companies due to proprietary devel- opment. For example, the United States government paid for the development of BOAST, a black oil simulator. Despite some reputed bugs in the original government issue, it did promote competition in the market, The base program, which came as raw source code, has been used to develop subsequent PC versions with inany improve- ments, including graphics, Recently, a full suite of geostatistical software was, made available at moderate cost (Iree) from Stanford ‘The software, GSLIB, does not have a fancy graphical user interface, but it has a reputation for being techni- cally sound. This software was written by Dr. Clayton Deutsch and several books have been publistied sup- porting its use. Check the Internet. There are a number of free pro- {grams available on the World Wide Web, Integrated consulting companies ‘Many companies making simulation software are also in the consulting business, or perhaps, they make sot ware for their consulting business. Somewhere along the way, they decide to market their software independently oftheir consulting services, ‘A company using the software they develop normally builds more userfriendly software that more closely meets technical requirements, On the other hand, the level of code development can suffer ifthe program was developed by users rather than IT professionals. Engineers have a reputation for code that works, although rarely elegant in structure or efficiency. In truth,the best software is a compromise between programming efficiency and logical usage. Software from these compa nies will cover the entire spectrum, from the very best to roug-aroundtheedges. Thus. the software from one of these companies must be tested and analyzed. ‘The goals of an integrated consulting company may compete between providing consulting services and pro- viding software, Some do not want to provide sottware to small consultants whom they perceive will take away con- sulting business. In some cases. particularly when selling to large operating companies, this does not seem to be an issue. In reality. a large portion of consulting transpires based on personal contacts. In this case, an individual has an advantage simply because the quality of the work he or she does is known to the producing company There may be individuals with deter qualifications who are not even considered, (This is one of the major rea- sons many operating companies hire exemployees or staff who were previously laid off This is a risk: management issue in which the producing company follows the adage, Better the devil you know than the one ‘you don't) To return to the point, obtaining revenue on the software is normally better for the integrated consult- ing company than no revenue at all. It is rumored a major reservoir simulation software supplier quickly revised its policy on this issue when its ‘customers hinted the company would lose a substantial part of its user base if t attempted to shut out small con- sultants and contractors. The author's interpretation is the operating companies wanted a more competitive market for sourcing simulation expertise, The author has worked fora large integrated software/ consulting company, large and intermediate producers, on contract, and as an inde- pendent consultant. The largest determinant of success remains the skill of the person who is doing the work, Good people work in al of the categories listed An integrated consulting company is potentially a good source of software. First. approach the company and determine its attitude toward consulting competi tion, This is a function of management attitudes. If the approach is mature, chances are consultants and sinall businesses can do business with the company In-house software Engineers who work for a major company may have ‘no choice. For the most part, the author's experience with inhouse software is that it rarely has the polish of com- mercial products. However, itis not all bad, For example Study Management one can talk directs to the person in research who is developing and maintaining the program. If they hace time, they will add custom features for your project The author worked on one such suite of programs ‘The software was developed as a research tool and is highly touted in technical papers from the company that developed it. {Lis entirely different from any software in the commercial sector. The data input requires knowl edge of C programming. The documentation for these programs was significantly outofdate. A lange invest- ment in time was required to learn this program. The final results were mixed. Some of the outout was quite good and other par's were not. Some of the features on the subsidiary programs were useful and impressive. The latter were not available, to the authors knowledge. in the commercial sector. This program cannot solve some of the difficult compositional problems, but a number of commercial programs can solve them. It is difficult to find consultants familiar with this software; the compa ny’s market is effectively restricted to former employees. On balance, the technical pros and cons struck the author as being equal, a potential advantage in some sit- uations and a disadvantage in others Where to find different sources of software There are many software sources. Weeding them out will take time, Following are sources the author has used to identity suppliers: +The directory of professional services at the back of technical journals ‘Tre yellow pages. This is one of the most over looked sources of information. The cost of putting an ad in the yellow pages is almost trivial. Most companies have a yellow pages tsting Computing journals. Magazines such as Geobyte, PC Magazine, Byte, and Unix World otten have reviews as well as a full slate of advertising Many industry journals have an annual sot ware review. Oiwweek, for instance,has an annual review. PennWell puts out a wortdwide review The Journal of Canadian Petroleum Technology now provides a software summary in theie"Computer Appiications”issue, which 's usually the April issue, The Internet is very useful. Some oil industry spe- cific sites list suppliers by business category Normally, word of mouth will provide a great deal of information. Ask friends and contacts what soft: ware is available and what they think of i > ansPractical Reservair Simulation Local sources ‘The search forsoftware clues not have to be worldwide, Firsvelass software can he developed locally: Canadia soltware from different suppliers has set the pace, partic larly in the ares of eeonomnic evaluation, for a consider: able period. A munber of companies in Calgary lead the pack internationally in certain areas of simulation. Hardware, software, and peripherals Software aust always be considened in conjunction with hardware. This is particulary true whenever there is {graphical output of any sort, Getting the program to com- municate with various screen standards, plotters, and printers & an enormous headache. This is surprisingly easy to uveriook. The problem does not always become apparent until after the’ machine is hooked up. the solt- ware loaded, and one is partway through the ist analysis, Actually this is becoming less of problem. Most ofthe Unix machines have adopted PC standards for printers. Postscript printers are now much cheaper in relative terms, and most digitizers now do reasonable emulations ofall of their competitors Output ‘When the authorstarted using computerized log analy- sis, he worked for a company that had the software, a suit able computing platiorm, and a suitable output device. However, the output device was not dedicated to log analysis use, which made it impossible to make significant progress until a stip plotter, dedicated to log analysis, was obtained. Results are of litle use when one cannot look at nor communicate the information to others. It is easy to spend too much on the base platform and spend too little on output, The client never sees whether one has a 166 MHz Pentium 1 or a 24 GHz Pentium IV, However, they will always be able to tell if the output comes from a ninepin dot matrix printer or a 1,600 dpi taser printer. Subconsciously. the quality of the work will be measured to some degree by the appear- ance of the output. First, determine what the output will look like, and then work backwards. When the compromises are made, give up a bit of speed in favor of good quality output. Personal computers versus workstations ‘The greatest thing about the PC is that the degree of standardization is extremely high. For this reason alone, the author favors software that runs on a PC. Until the exception (0 this was for computar tionally intensive programs. Reservoir simulation fell into this category. Other examples ni this included geophysi cal applications, geostatistical applicatinns. geological mapping. and log analysis applications. In these cases, the RISC: (redhuced instruction set code) based architec: tures offered a serious advantage. Most of these ran on a Unix operating system. but recently, some of the software. tool packages are available ox PCS. During the last few years, the sophistication of PCs has increased, and they are now faster than the Unig RISC machines. Still. Unix RISC machines are very expensive, so there is virtually no contest, PCs have become the plat foren of choice ‘The development of C++ and other programming tools seems to have drastically improved the speed and quality with which graphical user interfaces can be devel oped. The author expects to see rapicl improvement in GUlsin the near future. Floating point performance and integer performance A number of years back a Unix workstation was pro duced with phenomenal floating-point performance. Most people felt it would be the best machine on the mar- ket, but the author was concemed it might not be as fast as hoped. It appeared there was too much contrast in integer and floatingpoint performance, Although foat- ingpoint calculations take longer than integer calcula- tions, each floating-point calculation requires several index manipulations to accomplish the correct multipi cation, On this basis, the two types of calculations are both important. In truth, the authors computer, which hhad good floating point and integer performance, achieved better performance than the Unix workstation RISC versus CISC A recent article on this issue was unclear on some of the differences between RISC and CISC (complex instruc: tion set computer) systems, The CPU of a computer comes with certain instructions hard-wired into the cit cuit board. A compiler, for a high-level language such as, Fortran, uses combinations of these instructions to per form operations and builtin functions. Historically, most large computers were expected t0 perform numerous database manipulations. The com plex instructions were designed to ease data manipula- tion. This increased the performance of computers and was a very good thing,Subsequently particulary for caleulationintensive programs, it was found that the compiler could be pro- grammed to use more steps that were simpler in the CPU. However, this optimization relied on sophisticated com> pilers to devise Better anc more direct machine iasteuc- tian sets, The implication of this is that a hardware ven- dors compilers have as muct to do with achievable com- puter performance as the actual speed of the internal clock, Therefore, when evaluating software and hard ware, investigate the efficiency of compilers ‘The improved performance of recent PC CPUS proba- diy has a fot to do with the RISC expertise that Hewlett Packard and Intel shared. Incidentally, different software companies can use different compilers in generating code for their PCs. - Multiprocessors Multiprocessing is developing along a number of di ferent paths, Some of the RISC workstation manufacturers have been ‘working on massively scalar machines This same process is now taking place with PCs. Itis possible to order a two-processor machine off the shelf, with reasonably high clock speeds. Two processors do riot double simulation times. An increase of 30% is about normal. Many of the larger simulation software packages come with code designed to take advantage of this feature, There are also some attempts to use a large number of processors for large models. There are some SPE papets on this. For the most part, the increased power of the newer machines is quite ade quate for all but thermal simutations and some of the Jarge compositional simutations. Cost-effectiveness The costetectiveness of hardware varies considerably. The truth is that the majority of us are unlikely to fully appreciate the factors that affect performance. Whenever wwe do not understand the inner workings of a device, we are vulnerable as consumers. In these circumstances, we end up buying perceptions rather than underlying value or performance, The author is not an expert in computer architecture, but he understands some of these differences. Most peo- ple who use the [BM PC of IBM clone ate using an Intel cchip for the central processing unit. Variations in per formance occur depending on how information is passed between various components in the computer, and the ‘configuration of the hard disk. This means that how mem- ory is accessed (memory bus) and the data bus strongly Study Manageme affect performance, The new Rambus memory increases performance considerably. This. memory probably decreases actual execution times by 30" conpared toa siandard PCL bus Cost effectiveness varies considerably: One can easily pay 30% more for a machine that performs 30% slower than a competing product. Overall, the PC market hay become much more competitive, and these differences will diminist in time, Many local companies are now get- ting out ofthe hardware side of the business (One item that also varies considerably is the cost of add-on peripherals. The first PC the author owned was an BM model 60, which featured the micro channel archi- tecture (MCA). To add a 5.25:n. floppy disk would cost 700,00 since the computer tad the newer (and suppos- ‘ely better) MCA, Atthe time, a standard AT type external drive cost $350, ‘What is the moral of the story? Lear as much as possible about how computers really work. It can be hard to find this information ina readable form. The situation is improving rad- ically The books by Peter Norton and PC maga- Zines were good at explaining the basics. Look through PC magazines and check out the ratings. Reading these requires some subrle interpretation. Since magazines depend on advertising from hardware manufacturers for revenue, they never give a machine ac outright bad review: However if one reads between the lines of various shades of acclaim,one can determine the better choices A number of websites post ratings.The top PC magazines also have informative Internet sites Some specialty web sites also offer good sources of information, Many of the cheaper less well-known computer brands with smaiter reputations may offer super cr cost performance.The CPU chips are all made by the same contpany. probably Intel.The differ- ences in physical reliability are, in the authors opinion, not that great + Many of the suppliers who sell or market directly on the Internet seem to have high-quality equip: ment and good ratings in the PC magazinesPractical Reservoir Simulation Maintenance The author does not recommend buying maiv- tenance programs. Normally this costs about 12% of the computer cost for large Unix RISC machines. There has to be a major failure to recover that investment, Since the electronics are quite reliable, the author recom mends getting a quote trom an insurance company on electromechanical failure. The cost for this is normally about 2-3% of the computer price. This is radically more cost-effective. Tne hardware vendor will say that, without mainte- nance, the user will not get operating system upgrades. AS a consultant, who is a user of software, the author has found that this is actually an advantage. (a the past, new releases of operating systems have corrected bugs that had been found, but a work around or patch had already been developed for these old bugs. However, the intro- duction of the new and improved system often intro- duced a number of new bugs. This involved more expense to identify and fix. Colloquially the leading edge of technology has often become known as the bleeding ‘edge of technology. The exception to this rule is when a company’s main business is software development. In this case, the company itas to be aware of the new releases and the bugs that go with them, The company will not fix the bugs that have patches, because some of their cus- tomers will still be using older versions of the operating system; however, the company does need to idemify and contain the new bugs. Both disk drives failed in the author’ first Unix com- Puter. The computer manufacturer refused to replace drives that failed in less than a year even though the man- ufacturer normally warrants the drives for a year. A local source replaced the drives for substantially lower prices than directly from the manufacturer. The author had not purchased the maintenance but was justified—even in these circumstances, The cost of both disk drives was about half the anual maintenance fee. ‘There is an exception to the “don't buy maintenance* rule. If the entire business depends on the continued function of one computer, then maintenance may be worthwhile, There are a limited number of companies in this position, but it is not critical for the average oil indus- try simulation engineer or consultant. zen < Variations in performance Ata technical conterence, one of the engineers from a large Canadian company proudly announced that the company he worked for was using the software that isthe most widely used worldwide, The devil made me do i and I had to ask, "How do you think the performance compares to other simulators that you've used?” There ‘was long and somewhat dark pause, at which point the individual was forced to admit that he had never used any other simulation software, For biack oil reservoir simulation, the author has tied ‘a number of software applications. He used similar proj- ects and thoroughiy tested the capabilities of the pro- grams, All of the models used produced similar results| with similar levels of performance. Differences in speed “xere relatively minor. However, everything said in the preceding text about black oil models is probably not true for compositional models. There are big differences in performance for compositional simulators. The implementation math. ematicaly is far less standard, Probably, there are big dit ferences in the performance of thermal simulators as welt, Commitments to platforms Simulation software companies tend to make strong commitments to one type of platform ot another. They ‘were unwilling to attempt installations on other platforms and expressed serious doubt about being able to compile even a standard Fortran 77 program. In the authors expe- rience, the latter concerns were unfounded. The biggest problem encountered was the use of SGI (or sgi) as a vari able name. To the reservoir engineer, this is obviously ink tial gas saturation. On Silicon Graphics, Ine, machines this is a reserved variable name and is used fer system type calls. The initial gas saturation variable was easily renamed Sj. Changes were required in two or three ‘modules with a find-and-replace command. ft was hardly a serious problem {As forthe graphics on pre-and postprocessing, the sot ware companies simply laughed. The software for these features apparently had radically different structures Tough problems ‘Technical capability commonly seems to be a major concern. Surprisingly, the author has found people unaware of what constitutes a difficult problem. The toughest simulations the author has nun are for bydrauli- cally fractured wells, with the frac included in the grid.The contrast in transmissibilities makes the problem diffi cout for the matrix solver to handle, One cannot put in the frac with actval dimensions. ff the frac width is no less than one foot (0.3 meters). the program works very well Low compressibility fluids are harderto work with:tence, oil problems are more diffieute than gas problems Layering makes the problem even more difficult. There are multiphase effects for oils below the bubblepoint, In the past, some simulators could handle this and some could not ‘Teaditionally coning was the most dificult problem, A high degree of implicitness is required to maintain stabil ity This eequires implicitness not only for the reservoir for mulation, but also for the well equations. Here one has, high gric-block throughput due to converging flow and multiple phase effects, which are coniinear. Recently, many of these difficulties have been resolved by local grid refinement, This detinitely slows down a simulator The regular structure of the matrix is disrupted, requiring more time to solve Combined coning and hydraulically fractured or hori zontal wells can result in problems that are more difficult. Inis only receatiy that this issue has been addressed for compositional simulations. Some interesting results were obtained. In fact, much of this work is still being done with black oil (condensate) simulators such as the work by Setar, Bachman, et al Well controls are often dificult to handle, as dis cussed in chapter 13. Features Strange to say, features may dominate the choice of software, This is nota trivial issue. Most of itis concerned ‘with well control schemes, Some useful features include woidage replacement calculations and group controls. ‘These will make an engineer’ lite much easier Another area, particularly relevant to offshore work, is related to production engineering options. Most offshore wells have high rates and, under these conditions, tubu- lacs and completion efficiency will have a major influ ence on cash flow. Problems must be solved considering, both of these issues, Most simulators now have focal grid refinement. This ‘was not always the case even a few years ago, but it is a useful feature, Similany a horizontal wel grid refinement, which normally uses ring-type refinements, is also useful On high-rate horizontal wels, in high-permeability forma- tions, wellbore hydraulics (horizontal flow through the wellbore) may become significant Study Management Graphies Graptiies are actually an important consideration Evaluating simulation results can take time. A good grape ics postprocessor will have a significant impact on how much can be done Given that che simulators seem to have similar levels of performance, input modules and output processing will be the deciding criteria, There is no substitute fr siting down for an afternoon or two art Playing with i Graphics actually put more demands on hartware than the simulator. This relates to the graphics toolkit, which makes huge demands on memory for 3D realiza- tions. Therelore, consider that the graphics might be more demanding on computer resources, such as mem- ‘ory than the simulator One area where the author has noted variation in performance relates to digitizing geological maps. Some programs are easier to use than others. This aree con- sues much time. The interpolation schemes used to generate grid cel! values from contours vary in quality, Manual correction is very time-consuming and should be avoided if possible Tue author does not recommend automatic data set builders. Ian engineer knows reservoir engineering, they are more of a deterrent than a help. If unsure and tempt- ed t0 rely on the data set builder, stow down and learn the input. An engineer risks serious errors by not under standing the pracess. Geostatistics Geostatistics is becoming increasingly important Investigate this system: in conjunction when choosing a reservoir simulator Testing The SPE has commissioned @ number of interesting comparative simulation projects. All of them were devel- ‘oped to test various components of reservoir simulators. tn teuth, some of the issues, such as vertical movement of gas, are no longer major technical issues. On the other hand, a number of comparative simulation pro} ects are now used bath for debugging and as bench- marks. In the later category, the older tests are some- ‘what small to be much of a challenge for today's com- puters. However, these tests are siill used as bench. marking standards, since no one has come up with problems to replace them. 288Practical Reservoir Simulation A variety of tests is optimal. Convert some real prob: Jems toa new data set. To date. the author is not aware of any SPE comparative solutions that concentrate on well controls nor is there a review of graphical user interfaces. Business issues Some software companies are quite flexible and will rent their programs by the month, Normally there isa pre rium for doing this compared to leasing for the entire year. The code can be purchased outright, normally ia executable format, {n this case, there will be an annual maintenance fee One software supplier wanted a deposit for the con- sulting help he perceived a user would need to run their simulator Engineers who have worked on a large num: ber of ditterent models require lite, if any, support, but help is definitely required in some instances, for exam- ple, when there is a bug or the documentation is wrong or eryptic. In these cases, the better choice is to find other software The oil industry often involves joint intetests on pro- ducing properties, One issue that arises is the ability 10 trade simulation results and input, For example, in a uni- tization proceeding, there is usually a technical commit tee. It is rare that there is unanimity among owners on technical, economic, and operational issues, Simulation is often used to determine an operating strategy and to determine optimal development. Many of these technical issues have tradeotts, which, when fully analyzed, allow companies to agree on patticipation, if not on the actual technical input. Therefore, ifthe majority ofthe partners, are committed to a particular software package. there are advantages to using this sottware. It sometimes appears that operating companies are concerned about getting different results from different simulators. While there are difterences in features, this is a matter of efficiency. Different simulators should aoc and in the authors experience do npt, produce diferent results for black oil studies, ff differences exist, most like- ly the input to the simulator has changed. More often, this represents differences in geological input, grid-bfock sizes, and other significant input. Incidentally, the differences in input between com panies can often be dramatically different, This can be a real learning experience. Integrating the different per- spectives from several operating companies, both large and small, generally results in superior engineering, This can be a difficult proces politically. In some situations, different companies have different objectives and con- sensus cannot be achieved Summary With judicious shopping, it is possible to find a com- bination of technical excellence, hardware compatibility, and realistic business terms. Technical capability is nor mally not the dominant factor in choosing software. In the author’ experience, sometimes the order is reversed. Managing Studies Realistically, significant number of reservoir engi neers will never do a simulation study. More commonly. a consultant, either internal or external, is retained. ia these circumstances, an engineer will be faced with a umber of difficulties that are not entirely technical, These include bidding out a job, selecting somebody who will do the job correctly, and meeting a deadline. Having worked on both sides of tne fence, the author has, ‘some suggestions, which may be helpful. There is a book on this general topic: Choosing and Using a Consultant, A Managers Guide to Consulting Services by Herman Holtz? This book is unique in that i is writen from a clients perspective zea < Choosing a consultant I one situation, ARE submitted a bid for a complex coning study for $15,000. The operating company obtained a bid for almost half the cost at $8,000, The company personnel knew me and asked if could do the job forless. In our opinion, the job could not be done for less, and we declined to reduce the price. Of course, the other consultant was awarded the job. Several months later, we learned that the budget had been spent, and the consultant had announced that the problem required a dual porosity simulation, which he did not have, All work was halted, Since the consultant hadone all Ne outlined in the bid, he was paid. Nevertheless, this is an indication of where not spending ‘rough can result in no benefit whatsoever ARE was awarded the next job and many more follow: Up projects with virtually no questions asked Bid preparation Bid preparation can take a long time. A moderately sized simulation can take several day of billable tine to prepare comprehensively. Being realistic doesn’ always pay either the low-cost Bidder normally gets the job. ifthe job is underbid, the operator is in a catch 22. tt is unlikely that a consultant will continue i he knows that continued work will lead to a larger loss. Its preferable not to be paid Jor ane aonth of work and obtain payment for the next two months than spend three months com- pleting the project and being paid for one month. This leaves the operator with a choice of hiring somebody new from scratch, and paying for him or her to get up to speed on what the existing consultant has done, of con tinuing with the existing consultant. This does not mean that consultants do this deliber- ately. It is human nature to underestimate engineering ‘completion time, This systematic bias has been known fora long time In many cases, it is impossible to anticipate what results will develop during the course of a study. There are simply too many variables, The issue that arises is whether consultants should suffer financially for some- thing that neither the operator nor consultant coutd foresee. Legally this would be viewed as an “unjust enrichment.” The operating company normally agrees to an outline of the approach before allowing the study to proceed In many cases, it is impossible to determine how many of the possibiliies really contributed to a study going over budget, However, the system of choosing low bids almost guarantees that overruns will occur—either by accident or by design You may not win by being on budget in one case, the author reviewed a previous study and wondered why certain prediction schemes had not been run, In this case, afve spot waterfiood had been evaluat ed. The project wasn’t economical because too much production was lost before watertiood production response was achieved, The permeability was suliciently good that a nine spot would have been sufficient, if placed correctly. It is likely that further investigation was Study Management stopped by not seeiayy this possibility oF the matter was. wrapped up without further thought simply to stay on budget and look good. The project was never imple: mented, so the company Would not have had an obvious engineering failure. On the other hand, they may have walked away trom a waterflood that would likely have added significant value, since a limited number of injec- tors had worked well o7 an offsetting pool Lack of information Ina number of circumstances, bids yo over budget because the operating company failed t0 provide perti- nent lata, One such example involved ae simultaneous smiodeling of a surface facility system and the reservoir, ‘The wells were loading up with fluids, whereupon they ‘were shut in until the pressure built up sufficiently Overall, the property was contract constrained so the reduced hours on the wells did not raise any flags. The problem did not materialize in the reservoir ‘mode! either. There was no liquid dropout in the reser voit, and the Lov rates did not cause any problems. When suslace facility modefing was implemented, a substantial portion of the wells was shut in by minimum rate limita- tions. Atthis point, the reservoir engineering staf realized that the field staff were concerned about this issue and had been requesting a surface/reservoir model, A con- siderable amount of time was required to adjust rates to 8 weekly or halt:monthly basis. Was the client treated unfairly? No. There was no other choice but t0 adjust the production rates manually. Itis| not certain that they were leaving out information delib- erately, but a number of people within the operating com: pany knew that this was a problem, It is quite easy to assume that someone else had flied in all of the details fn the end, this doesn't work well for anybody The con- sultant ends up stressed, which does not contribute to efficiency, and the company personnel end up with a cost overrun that does not look good fo their boss, Most company personnel are unlikely to rush into their supervisors office and proclaim that they made the mistake that led to a cost overrun, Joint venture bids (One situation that develops is working interest part ners in a unit decide a simulation is needed. The usual procedure is to have each company choose a consultant, Al ofthe consultants are asked to bid. All ofthe bids are evaluated, and the objective is to pick the best submis: sion. In one case, the operator evaluated all af the bidsPractical Reservoir Simulation and determined that ARE was the best prepared, Despite this, the job was awarded to anuther consultant. The operator agreed to use a different consultant as a con cession to another reluctant partner in order to get a sir tlation done at all, The engineer at the operating compa ny was very aonest. Although ARE was disappointed, the. political situation was understandable. He made a deci: sion in the bes’ interests of his company These forces are completely beyond a consultant's control, and the presence of a lange umber of bidders automatically reduces the chance of success. A strong case can be made for spending less time on a bid in which many companies are bidding Contracts Contracts are a souice of real problems. The most ‘common problem is the use of an inappropriate “ofthe shelf” contract. Invariably, somebody lands over one of these contracts and announces that this must be signed Here are some of the problems ARE has experienced: ‘The purchasing departments newly standatd- ized contract was designed for companies that install field facilities. One of the main require- ments was that fireproof clothing was to be ‘worn at all times and that the contractor and all his equipment be insured. Yes.this contract was deemed appropriate for contract engineers and was given to ARE. None of the company’s per- sonnel was wearing fireproof business suits, Nor were any of the contractors. Ifthe matter ever ended up in court, the million doliar question would be,"How would a contractor know which clauses were to be ignored and which ‘were to be followed?” Under these cireum- stances, the courts may set aside the agreement on the basis that it was common knowledge that signing the contract was an absurd formali- ‘implying that no one expected the contiactor to follow the entire contract, ARE was a subcontractor on a large simulation project for a company that also wrote software, ‘The contract we received was written for people who were preparing software code and working inshouse as contractors. In this case, the contract was onesided, with no protection atforded to the consultant. This contract was close to mak ing ARE personnel direct employees. Under these circumstances, labor law may automatical- ly supercede any direct terms. This is a complex 286 < area of the law. and itis easy to get blindsided, unless you're a lawyer working in this specialty. In this particular contract, some of the clauses were also contradictory. Another project we did was an independent eval- uation for the purchase of a property swap In this, case, we were provided with a contract that was intended for another operating company that was reviewing information in a data toom, The main objectives of the contract proffered were to get all information back (including all copies) and to absolve the operator of the properties from responsibility for the data provided. As an inde- pendent consultant, we hold the operating com- pany responsible for providing all of the re‘evant data (see the disclaimers in the repo). Moreover, ‘we had every intention of retaining a copy olthe data in a permanent record. This was our due dill gence record in the event that the deal turned. sour and one of the two parties decided to sue somebody One of the companies was based in the United States, where litigation is a common part of doing business, In all of these cases, the contracts were appropriate for the original circumstances for which they were designed. However, ARE would not sign the contracts since they were clearly inappropriate. Sadly in all of the cases, there was high initial resistance because these contracts had become company policy In the end, ARE convinced the individuals involved that the inappropriate contracts did both sides more harm than good. in fact, they were better off with no contract at all than with a ‘wrong’ contract. There are many remedies through com- mon law and existing precedents. In all but one of these cases, the client company decided against rewriting their contracts. Contracts are fine, but make sure the contract is appropriate for the type of work being done, Value of contracts Itishoped that the process of making up a contract leads toa common understanding, but ths is nt always the case. In the final analysis, contracts may be of great help when in ligation. However, at this stage, one is in damage-control mode, ie, having a contract may not avoid damage. Getting toa good understanding, with the right consultant, will ike- ly avoid the problems up front. To this end, letters are much faster (0 prepare, get t0 the point more quickly and are strong backup if one ends up in courtRealistic costs One area that seems 10 cause consternation is cons sulling fees. Many employees compare their wages with cconstting fees and feel that consultants mast be gouging them or their companies. From a consultants point of view things have been competitive on the engineering side singe 1986, Most of this problem stems from employ- ‘ees lack of understanding as to how much they cost their company They see only their direct salary and easily for uet the Denefts, the cost of the olfice space they occupy the cost of equipment, such as computers, the money they are paid for vacation, and holiday time. Most oil industry consultants are welleducated and quickly find fulltime jobs in other industves, in the event that their fees don't cover overhead costs and time between jobs ‘Thus, there is a billing efficiency adjustment to bring a consultant’ rates in line with fulltime work, Consulting is inherently riskier than being an employee, and the rate of return should be correspondingly higher. An article extracted from the SPES Journal of Proleum Technalogy covers this topic:!The consulting fee sou are paying does not directly conelate to the money. that the individual consultant is putting in his pocket. Realistic expectations As a tule, operating company personnel expect a great deal from consultants. Having worked in both envi- ronments, che author recognizes that the expectations of some operating companies ate not realistic. Nevertheless, knowing that people will rigorously try to find fault with your work has a tendency to make one sharper. Emphasis on G&A costs During the past (0 years, there has been tremendous pressure to reduce general and administrative (G&A) costs. Controlling these costs has always been a good idea: however, one wonders if this nas been taken too far In general, many companies are quite willing to spend millions of dollars on horizontal wells and in deep drilling areas. Yet, the sare companies resist spending ‘more than $10,000 to $15,000 on a reservoir study Part of this may be due to a percentage of studies that, for vari ous reasons, do not produce usable results. However. it seems that a good general objective has been taken to an extreme of late. In our experience, itis not uncommon for production to double based (sometimes parlly) on the results ofa fechnical study. The key is always to link the potential upside versus a realistic cost fora study. Study Managem In this regard. there is always ati element of salesman ship in dealing with management, When working for a major company: the author was not always able (0 find the right sales points to justify att expense. These points are not easily quantified and making them can take a lot of creativity: Someticnes no amount of salesmanship will work if management has entrenched views. The key isto realistically and honestly demonstrate that the incremen: tal benefits justily the cost of a study Mistakes A professor brought a guest lecturer from one of the largest engineering and procurement (E&P) firms in Canada to a university engineering class, and his lecture left a lasting impression. in his presentation, he outlined, a story in which a subcontracted engineering firm that was famous in its specialty had made a serious engineer- ng error Six months aiter submitting its report and ree- ‘ommendations, the subcontractor found the error. They approached the EP firm and admitted they had made a grievous error. Further, they admitted that they were responsible and most likely. if the E&P firm elected to lti- gate, that the subcontractor would be forced out of busi- ness. It was also suggested that they could recover a sige nificant amount of money by dissolving the company, ‘The E&P firm realized that this error would cause them to lose a significant sum of money, since a considerable amount of engineering time had already progressed based on the faulty report supplied. On the other hand, they would have lost a great deal more tiad the mistake not been brought to their attention and allowed to prop agate 10 completion of the project. At this extreme. a noticeable negative effect would occurto the bottom line for the E&P firm In the end. the EXP firm decided to let the subcon- tractor redo the work and paid the company for i. The subcontractors prompiness and honesty had saved them {an enormous amount of money and the embarrassment of a failed project. The E&P firm could have put the sub- contractor out of business and recovered a good portion of the cost, Other consultants in the field likely could have done the work, On the other hand, this would have resulted in more delay. since the existing subcontractor was already familiar with the project. The E&P firm also stood to lose in the end by removing a well-qualified firm in a market with relatively few competitors, The E&P firm also realized that it had a good relation with the subcon- > 287Practical Reservoir Simulation tractor. They could trust that problems would be prompt y brought into the open in the future, where damage could be contained at minimum cost. Consulting is a relationship Ths is significantly different from buying a hamburger at MacDonalds. The best results are obtained when the consultant and the client have a good understanding of what is expected and required. There are a number of good books on this subject such as Flaicless Consulting by Peter Block and The Consultane’s Caling by Geottrey M, Bellman3-> Obviously, the author read these from the perspective of running a consulting company. However, if ‘you can understand the other person’ position, itis often easier to communicate Similarly, consultants can make stalf feet awkward and threatened, particularly when the staff is placed in the position of relying on an expert. This is often uncon- scious. To the consultant, it can be baffling, One some- times gets negative reactions although ones actions are ‘no different from other similar engagements. With experience, it is possible to tell when this is occurring, and one does get better at avoiding this prob- lem. At other times, a contractor can feel as if there is, ‘nothing to do or say to relieve the tension. Finally, there are some instances where clients are simply rude to consultants as a matter of course, Eventually, people who fallin this category will find them- selves dealing exclusively with seconé-ate consultants. ‘The good ones will find betier work and will not come back. Moreover, consultants do talk to each other, and companies develop good and bad reputations, Meetings Sa rule, have regular meetings with clients wien a major simulation is underway The requirements vary somevshat depending on the stage ofthe study. Normally there will be a meeting at the beginning of the bid process shen the problem is outlined. A second meeting falls when the bid is presented. During the early stages of data gathering, relatively few meetings ace required while PVT and relative perme. ability data are being processed. A review after the first run is normally sufficient to cover ths issue. History matching on a large project requires meetings. at least weekly or biweekly, Similarly. the prediction phase normally involves regular contact. Shorter simula tions require less time. Summary Picking a consultant is not easy. The issues involved are only panty technical. In general, people are less com: forabie discussing these issues than technical content. n the final analysis, getting the right answer is the most important objective. Under most circumstances, the implication of the work that is being done vastly exceeds the cost of study. this is not the case, then itis ikely that fone should be directing attention to other projets Problem Areas for Simulation A number of problems seem to recur from year to year despite practical experience to the contrary. These include + Gas injection Gravity override Layering Several reasons can cause these same problems. Insariably, the problems relate to the people doing the work and management. 288 < Gas injection Gas injection scenarios are commonly run in black oit simulations. Gas injection is handled poorly by a simula tor Simulators are poor at predicting horizontal gas dis Placements fora long list of reasons: Athigh mobility ratios, which occur with gas injection, grid orientation effects become very significant. Viscous fingering is not accounted for in the for- mulation of a black oil model.Gridding requirements are more demanding. Smaller scale heterogeneities must be account- ed for and more layers are required than for water! displacements ‘These limitations are known by simulation engineers, ‘The problem is more probably that numerically oriented simulation engineers have difficulty adjusting their results, with something that cannot be quantitatively determined, Gravity override Another problem area is gravity override, which can ‘occur quickly even in thin reservoirs. This problem is widely recognized in steam injection. {t was more slowly recognized with miscible flooding. Some intense debates have taken place regarding how much gravity override would actually occur in the latter case, the amount of gravity override was seriously underestimiated. ‘One major company as part of government applica- tion, submitted hydrocarbon miscible flood predictions fora major carbonate reef reservoir that were one-third to one-half less than predictions prepared by other compa- nies. Significantly, royalty holidays and other economic incentives were determined based on estimated recovery ‘Thus, the other operators were unhappy with this break from their more optimistic recovery predictions, ‘The source of some of these problems relates to limi- tations of computing, which again means that compre- hensive quantitative predictions could not be made. Actual reservoir performance has proven the lower recovery factor to be closer to the mark. Employees of government agencies have noted, in private, that applica tions seem to be systematically optimistic. They have also noted, publicly when industry participants were on opposing sides of technical issues, an extreme spread in expected recoveries for the same reservoirs Heterogeneity/layering Experience has shown that geological effects are con- sistently underestimated. The displacement of oil and gas is reduced by streaks of high permeability. While reservoir engineers are familiar with this concept, their training does not include sufficient geology to deal withthe solu- tion easily. Only a limited number of people have both geological and engineering training and can deal direct |y with these issues. This is one of the major reasons for rmultidsciplinary teams. However, with multiple people involved in attempting to resolve complex issues, its dit Study Management ficult to achieve seamless integration. Furthermore, it is imherently dificult to extrapolate between reservoirs anc create a realistic model, Models tend to be simpler than they should, and this systematically overestimates pro duction performance and recovery. Consequently this issue arises repeatedly Solutions to recurring problems Simulation results need to be ternpered with practical experience. Ideally. most reservoir engineers would only be allowed to do simulation when they have accurnulat- ed a certain amount of practical reservoir experience along with some geological background This is not consistent with the way people actualy approach work on simulations. Often, the more techni- cally oriented engineers gravitate to this field during the Jatter part of their undergraduate education, or they pur- sue detailed training at the masters level. They are less familiar with how to find this information or are less like- ly to have direct experience with the production per- formance of a large number of reservoirs. Conversely, reserve evaluation engineers, who normally gain massive amounts of experience analyzing production perlorm- ‘ance, often are not interested in detailed technical study. Reserve evaluation engineers can develop a jaundiced view of simulation, often with good cause ‘The solution to these problems requires under- standing in both the reserve evaluation and simulation disciplines. Since this is a simulation book, we have iden- tified areas where simulation engineers can be more con- versant with practical experience. The current discussion is limited to gas flooding, since it is by far the worst cul- prit. The following sources of data can be used for both primary recovery and waterfiooding. Interstate Oil Compact Commission ‘There are two excellent sources. The first is the Interstate Oil Compact Commission (IOC): In those reservoirs having high permeability and high vertical span, gas injection may result in high recovery factors because of gravity segregation If the reservoir lacks sufficient vertical perme- ability or relief for gravity segregation to be effective, «frontal drive similar to that used for water injee- tion can be used. This is often referred to as “Dispersed Gas Injection” In general, we may > 288Practical Reservoirs Simulation 220 expect dispersed gas injection to be more succes fully applied in reservoirs that are relatively thin and with tle ap. Injection into the (op of the formation (or ita the gas cap) will be more applicable o reservoirs hhaving high vertical permeabilites (200 mD or more) and enough vertical relief to allow the gas cap to aisplace the oll downwares. {In most proposed secondary projects gas will do neither ofthese things (conformance. displacement and sweep efficiency) as welt as water? as injection does have its application. However, the conditions are restrictive. You must have high vertical per rmeability and high vertical span. Note that waterflooding is usually more etfecive tan gas flooding AEUB The IOC’ comments are largely qualitative, Another source on this subject isthe Alberta Energy and Utilities Board (AEUB). In this regard, the AEUB has the bottom: line answer—years of experience ‘Some interpretation of the figures in Table L4-( is required. First, the gas flood reservoirs comprise about 12 pools, compared to more than 4,500 pools on pri- mary, 2.709 watertiood pools, and 53 solvent floods. The primary recovery factor in these pools is very high at 32%, These recovery factors include reservoirs with favorable gravity segregation conditions of high vertical span and high vertical permeability Yet, the incremen- tal recovery for these gas floods is only 7%, compared to 14% for watertloods. Gas flooding increases primary recovery by 0.07/0.32 = 0,22 and waterflooding increas- es primary recovery by 0.14/0.15 = 0.93, Since gas flood- ing can give very high recoveries in the right applica. tion, it may be deduced that horizontal gas floods give very low recoveries. This information is extracted on a pookby-poo! basis as shown in Table [4 Five reservoirs have 10% or higher gas flood recoveries. the two high vertical relief Rainbow’ and'N’ pools are eliminated, only three reservoirs remain, Two are Cardium pools, which by virtue of the porasties are likely high- uality conglomerates. The Aerial Mannwille pool, with a porosity of 22.3%, is also likely ofa very high quality. Golden Spike is a welldocumented failure of vertical 32s injection. Theve is a SCPT paper on this failure, The main problern concerned an areally pervasive tight hor zontal layer across the main section of the reservoir. Vertical communication only existed around the reef rims, which meant a vertical displacement was not possi- ble, This is really an example of where inadequate geo- logical description resulted in the expenditure of large sums of capital inappropriately. The gas flood aren i list ed as having a pay of only 6.1 metets; the entire reef has a height of closer to 136 meters The AELB data doesn't include partial pressure main- tenance schemes, For instance, the author worked on the Wood River D-2‘C’ pool, which had crestal partial pres- sure maintenance. This was not particulary effective and is not included in the previous figures. Many gas floods don’t work very well Incidentally, the most common form of EOR ia Canada is hydrocarbon miscible fiooding—ie. enriched gas. in the United States, the most common form of EOR is C0, gas flooding. Many gas flood prob- lems apply to advanced processes. Other sources of practical experience ‘The Petroleum Society of CIM Monograph Number | titled Determination of Oil and Gas Reserves is an excel lent source of information.’ This monograph was pre- pared several years ago and has sold well throughout North America. Recently, the SPE has produced a hand- book on reserves. witch is also comprehensive* The styles of the two documents are quite different and both are recommended. Summary These recurring problems are possible to solve, but they are not easy to rectify since resolution involves an overlap of different disciplines. Engineers are encour- aged to get as broad-based experience as possible Working in reserves and geology are constructive expe- riences. In any event, these problems are well-known, and constructive steps can be taken to insure they do not recur. it ste nsaaaenensnitssnattiteracn be: niTable 14-1 Summary of Reserves of Conventional Crude Oil ooIP Recovery Factor (fraction) (E6M3) | Primary | Secondary | Tertiary Total Light-Medium Primary 3.5609 0.22 | 200 0.00 022 Waterflood 015 od 0.00 0.29 Solvent Flood | 880.8 0.28 0.18 | ous 059 | | GasFlood | 149.5 0.32 ear [0.00 039 | ‘Suamary of Reserves of Convenjonal Cade OW arbutable to Various Recovery Mechanisms os at December 31,1995. Table 14-2 Recovery Factors for Gas Flood Pools in the Province of Alberta, Canada PaaS oom | Primary |GasFlocd| Height, | Porosity emmy | oR R, | meters | Fraction ‘Aerial Mannville 1.188 0.12 014 262 0.223 Cyn-Pemb Cardium D 0.900 0.20 0.10 4.86 0.102 Golden Spike D3 49.600 053 0.05 6.10 0.068 Grande Prairie Halfway A 3.682 0.14 0.05 7.00 0.102 | Kakwa Cardium A 5.163 0.15 0.19 24d O24 Pembina Ostracod G 0.400 038 0.04 110 0.100 Rainbow Keg RF 37.000 oa 0.10 61.60 0.080 Rainbow Keg RN 2.940 0.30 013 28.3) 0.037 Rainbow Keg RH2H 0.200 035 204 9.70 0.060 Ricinus Cardium A 7137 =0.12 0.03 | 858 0.140 Ricinus Cardium O 4,850 ry 0.02, 881 0.120 Willesden Green Cardium A 35,600 <0.07 007 483 oi [ winafail 6-38 oso | eto 004 13.31 0.050Practical Reservoir Simulation 252 « References Deutsch, CM, and A.G.Journal, CSUIB: Geostatissical Software brary and Users Guide, 2% ed, Oxtord University Press, 1997 Deutsch, C.V. Geostanistcal Reservoir Modeling, Oxtord University Press, 2002 Rata H..Choosiny and Using @ Consultant. Manager’ Guide fo Consulting Services. John Wiley ‘and Sons, ne, 1989, ‘Truman, RB [| “Outsourcing Engineering Services:the Business Side of the Business” Journal of Peroleum Technology, (October): 915-318, 1996, Block, P, Flawless Consulting: Guide to Getting Your Experience Used, United Associates, In. Jossey-Bass Publishers, 1999. Bellman.GM..The Consuttanr’s Calling Banging Who You Awe 19 What You Do, Jossey-Bass Publishers, 1990, Interstate Oi! Compact Commission. Study of Consemvation of Oil and Gas io the United States, Interstate Oil Compact Commission, 1964 Aguilera, Ret al, Determination of Oil and Gas Reserves, Petroleum Society Monograph No.1 1904 Chronquist.C.. Estimation and Classification of Reserves of Cride Oil, Natural Gas, and Condensate Society of Petroleum Engineers,2001