Shale plays in North America have arguably altered the energy mix for years to come. Just earlier this decade pundits were studying the rapid decline rates in Gulf of Mexico gas fields and wondering how the industry could continue to meet natural gas demand. Now unconventional gas makes up one-third of all gas produced in the US.
But we haven’t completely cracked the code on these difficult plays. This was evident in “Technology-Based Opportunities to Improve Bottom-Line Performance in Shale Gas Reservoirs,” a recent webcast hosted by E&P and sponsored by Kenda Capital.
Speakers Bill Severns of The Energy Consulting Group; Matt Bell with Geodynamics; George King, a consultant currently working with Apache Corp.; and Dave Elliott of
Shell discussed the technology needs of these demanding plays and shared their success tips.
One of the key messages was that the plays are not interchangeable. “All of the plays are different on the basis of depth, thickness, and gas in place, and the technology required to pursue those developments differs,” Severns said. “There are anchor technologies that are common to most successful ones, but there is a large technology component to each of these plays.”
The two main “anchor technologies,” he added, are horizontal drilling and large multi-stage fracture treatments. The companies that realized early on that these would be enabling technologies both spurred further development of the technologies and reaped the rewards for being early adopters. Chesapeake, for instance, went from a start-up to one of the largest gas producers in North America by “recognizing the importance of a few key technologies in the shale gas story and acting aggressively on that knowledge,” Severns said.
But it’s not just a producer story. There are technology stories as well. The drilling rig industry, for instance, is increasingly characterized by fit-for-purpose rigs to pursue resource plays in general and shale gas plays in particular. Severns said the key components are AC power, top drives, better mud pumps, and more powerful systems overall to drill the horizontal completions needed for shale gas.
“Industry has been moving in this direction and has been able to reap the benefits of lower cost because of this tailoring toward the shale gas plays,” he said.
Severns showed the standard “S” curve as it applies to shale plays. The beginning of the curve is characterized by uncertainty, but this is also the point at which a company has