What is the most practical way to obtain more reservoir knowledge earlier and throughout the life of a reservoir? Field results rely on proper decision making, and these decisions cannot be made without reservoir knowledge. So the whole point of reservoir optimization is having reliable reservoir data at every step along the way. In effect, this provides a proactive strategy and a contingency plan because the information needed to make the right business decisions is available at the right time - all the time.

Lifecycle reservoir modeling incorporates breakthrough technology and provides more information sooner. A new software tool called Resolve, collaborative by design, combines static information and dynamic data. By doing this, the Dynamic Reservoir Characterization (DRC) process reconciles reservoir characterization differences between geoscientists and engineers. DRC unites asset teams around common knowledge and a common decision-making model and fosters joint decision-making. Merging geophysics, logs, and pressure and production data, and iterating the information until it is in agreement in one model, delivers a powerful new body of knowledge that allows geology, geophysical and engineering professionals to make more confident decisions in time to make a difference.

In the past, engineers and geoscientists have not communicated with one another past the point of building initial models because there was one tool for interpreting seismic data and another tool for interpreting dynamic data. The DRC process, coupled with the new software, helps companies break down the walls that have separated the two disciplines. One tool takes the place of two - it honors the laws of physics, and it serves as a bridge between geological interpretations and reservoir data, regardless of the age and maturity of the reservoir.

With conventional fluid flow modeling, changes to the geologic model require a great deal of work and time to "re-grid" the reservoir. The software has adaptive meshing capabilities that can conform to reservoir geometries and automatically scale to the resolution needed. Using true unstructured 3-D mesh, changes are as simple as drag-and-drop, resulting a combination of speed and realism unavailable with any other tool. Modeling that used to take months now typically takes weeks. This time savings affects day-to-day workflow and shortens time-to-value of development and operating decisions.

Exploration

While the exploration phase of the exploration and production (E&P) business is filled with uncertainty and associated risk, no operator simply accepts this risk as the cost of doing business. Instead, operators focus a great deal of effort on mitigating risk. Many technological advances have been applied with the intent of reducing risk, but few have succeeded by fostering true interaction between geoscience and engineering.

By employing these new processes during the exploration phase to evaluate multiple prospects, technical professionals can generate multiple forecasts (rate/pressure versus time, cumulative production), identify critical parameters, and perform scenario analysis yielding probabilistic ranges along with economic evaluations. All of this is achieved by building models with static data (seismic, interpretation, analogs) focused on influential parameters, with the benefit of full fluid flow physics.

The system's ease of use is comparable to today's spreadsheet tools but is complemented by powerful analytics, which allows explorers to evaluate complex, multizone prospects in aggregate. This generates a tighter, more realistic risk profile. Once generated in the exploration phase, the building blocks for a "living model" have been established and can be carried through the asset lifecycle.

Appraisal

Once an exploration well has been drilled, the "living model" begins to serve more critical functions - determining whether or not the well is a commercial success and defining the initial characterization of the reservoir. To do this, once static models are converted into dynamic models with the inclusion of sensitive pressure and rate data. Analysis of pressure and rate data is used to understand reserve/recovery potential and define reservoir characteristics (drive mechanism, permeability, porosity, etc.).

Often, this is done with very little data. In some cases, a drill stem test can provide enough data to generate significant knowledge. The ability to maximize the value of all of the data, and the ability to alter the geologic interpretation with ease, allows the initial characterization to provide enough information to make the next business decision. Early and continuous modeling of reservoir geology, properties, flow characteristics, behavior and performance creates a baseline model of the reservoir that compares ongoing behavior against this model. Being able to judge and compare actual performance against pre-drill model results is valuable.

In all cases, the most critical question concerning commercial success is, "Are additional wells needed, and where should they be located?" Armed with a reliable understanding of the reservoir and the technology, the operator can test various development plans through virtual wells.

This system turns well placement into a point-and-click exercise and then generates recovery estimates and production forecasts. This information can then be used to evaluate various scenarios and perform economic analysis. Though this is highly valuable for a single reservoir, when applied to several it can serve as a very effective portfolio management tool, specifically with regards to capital allocation.

Development

As an operator moves into the development phases of a project, the "living model" evolves, too. With each well drilled, additional data is obtained and the model is refined. With the inclusion of each new dataset the development plan is further optimized, thus maximizing capital efficiency and eliminating unplanned events. Not only is the placement of each well done with a greater degree of certainty, but individual decisions for each well are influenced - completion strategy, production rates, etc. Appropriate application of the technology and workflow up to this point will yield an optimal development plan that effectively balances capital expense and extraction plans to maximize returns.

For example, DRC helped an E&P company increase reserves by 14% and improve rate of capital employed by 110% by detecting reserves earlier, defining the potential impact of a competitor's nearby well, and pinpointing a "leaky" fault west of the well. DRC enabled the asset team to "see beyond seismic" when making drilling decisions and revealed that drilling a third well at a cost of US $7 million was unnecessary because the existing wells could economically produce the reserves across the fault.

Production

As an asset moves further into its producing life, the types of decisions change, but they are no less important. With the models already established, periodically updating the model (surveillance) becomes a very simple task. However, the value of this ongoing exercise is tremendous.

The information generated through surveillance will yield forecasts that can be used to influence numerous operating decisions and can do so on a daily basis. Examples include optimizing production rates, designing workovers and recompletions (based on remaining reserves), identifying infill drilling opportunities, and shaping long-range planning.

When required, this system can be applied to wells already in the production phase. With a reliable characterization based on years of performance, modeling can analyze secondary and tertiary recovery methods. Because of its unique technical characteristics, it can create more realistic reservoir models in much less time than is possible with conventional modeling packages. This detailed understanding of individual assets gives E&P decision-makers a better understanding of the entire play.

"It's difficult to get people to appreciate new breakthroughs in our business," Senior Vice President of Frontera Resources Corp. Reggie Spiller said. "This approach, coupled with other geologic, geophysical, engineering, and economic parameters, makes for a powerful business decision-making tool that can be used in almost real time."

The lifecycle approach to reservoir management takes advantage of both time and technology, so why is our first reaction still one of skepticism? E&P professionals are known for having the voice of reason, so consider this. Being proactive and using technology that fosters cross-discipline collaboration early and through each phase of the reservoir's lifecycle increases reservoir knowledge and impacts business decisions in a positive way. Those who take on a relentless pursuit of high-quality reservoir knowledge can use that practical wisdom to change deliberation into realization and possibilities into recovery.

For more information, visit www.objectres.com.