Technology reveals ‘inevitable surprises’ in shale plays

Accurately predicting energy supply and demand dynamics in the decade ahead is a task fraught with challenges and uncertainties, but one that the future of many energy companies, and arguably the oil and gas industry as a whole, depends on.

Unclear as things might seem, some future scenarios are “predetermined.” As venture capitalist and scenario planner Peter Schwartz explained in his 2003 book Inevitable Surprises, we might be surprised when some of these situations come to fruition, but the reality is that they were inevitable.

The future of energy
When viewing the energy industry through this lens, a key question in the uncertainties surrounding the future energy mix in the US centers on which predictions can be classified as inevitable and which truly are in doubt.

The Z-System was deployed in a producing tight gas well hydraulically fractured in nine stages. Live production monitoring showed only two of the five zones monitored were contributing to production. (Images courtesy of Energy Ventures)

For example, it can be argued that renewable energy will play an increasingly important role – it is inevitable. However, the key uncertainty in that prediction centers on time. How long will it take for technology to be developed to make renewable energy economically viable? And how long will it be before it will make a meaningful impact on the energy mix?

In oil and gas, the “shale gale” stands to greatly impact the future energy mix. It seems inevitable that the energy extracted from this vast natural resource will grow rapidly over the next 20 years. Here, however, numerous uncertainties remain – whether there will be increased usage of CO2-friendly natural gas in power plants, if compressed natural gas will be used for vehicles and other purposes, or if there will be sufficient political will to support the safe and environmentally friendly exploitation of these unconventional reservoirs.

Shale reservoirs: homogeneous?
One thing that is certain and inevitable is that new technology will continue to play a vital role in making the exploration and production of hydrocarbons cleaner, more economic, and more efficient. This is becoming increasingly more apparent in the shale reservoirs as the ascent up the learning curve in each play is driven by acquiring more experience and improved knowledge.

During an international conference call to discuss a definitive merger agreement between Schlumberger and Smith International on Feb. 22, 2010, Schlumberger chairman and CEO Andrew Gould, discussed how knowledge and experience will change things in shale development.

Today, most of the fracs that are been done are purely geometric, he said. “They are doing these stage fracs, but if you look at our collection of production (loads), you would be amazed how few of the perforations actually produce any gas.” As people get better at identifying where the sweet spots really are, Gould explained, “They will selectively frac instead of geometrically frac, which will actually lower the cost.”

The underlying assumption behind Gould’s prediction that today’s geometric fracs will evolve into more targeted fracs in the future is based on the industry’s growing knowledge about the reservoir rocks and how they produce. Today’s common method of geometric fracs evenly spaced along the length of the shale in a horizontal wellbore makes sense if the shales are homogeneous, or at least homogeneous enough. Based on that fundamental supposition, and assuming similar hydraulic fracturing job designs and execution, each stage should perform similarly. However, as Gould commented, “You would be amazed how few of the perforations actually produce any gas.”

The desire to increase shale production has driven several Energy Ventures portfolio companies to create and commercialize new technologies specifically tailored to improve production.

New technology measures, predicts heterogeneity
One technology that provides greater insight into the true characteristics of the reservoir is the Helios distributed acoustic system created by Fotech Solutions. The system is deployed via downhole fiber-optic cable and detects minute changes to the path of light as it passes through the fiber-changes caused by sound waves hitting and altering the structure of the optical fiber anywhere along its length. Algorithms are then used to process the results to determine entry points of oil, gas, solids, and water.

This image shows the level of detailed information, including both connected and disconnected porosity, that is available from a shale sample.

This technology works well in conjunction with Ziebel’s Z-System, a carbon fiber rod that enables logging systems and manipulation in highly deviated and horizontal well bores.

In one case, the Z-System was deployed in a producing tight gas well hydraulically fractured in nine stages. Fotech’s Helios solution monitored live production in five of the nine stages. It became apparent that only two of the five zones were contributing to production in the commingled flow. While each geometric frac stage required considerable cost to complete and was completed with the expectation that each stage would contribute to production, that was not the case.

As one drills deeper into the reasons behind the variability seen in the perforations that actually produce gas, it is important to understand the producing mechanisms of shale and other unconventional reservoirs from the pore scale where heterogeneities can be very apparent.

This is where Ingrain’s technology comes into play. Ingrain’s digital rock physics laboratory uses advanced CT scanning techniques with proprietary segmentation and processing methods to create 3-D digital rock samples from core plugs, sidewall cores, and drill cuttings. With these samples, Ingrain can compute physical properties and fluid flow characteristics of reservoir rocks at the nanoscale, revealing previously unseen heterogeneities.

In its analysis of shale reservoir rock, Ingrain can to determine the prominent pore types in various plays, how they affect porosity and permeability, and how they are likely to vary between facies and depositional sequences.

For example, a wide range of pore types can be present in the Eagle Ford shale within a single typical core. Evaluating detailed information, including both connected and disconnected porosity available from a shale sample, indicates that porosity and permeability trends are controlled by pore type. In the end, these data can be used to help identify the most porous and organicrich zones in a reservoir to help operators better target production areas.

As understanding of the shale plays advances, the value of making fewer assumptions about E&P operations is becoming increasingly apparent. It is clear that the profitable, productive, and environmentally safe exploitation of the shale plays will continue to advance, as will the appropriate application of new technologies, including those described. Additionally, seismic and microseismic technologies in development, as well as lessons learned, will be fundamental drivers behind these improvements.

The common denominator is fast becoming heterogeneity, which becomes more apparent at smaller scales of resolution. Market leaders will be those who understand and predict heterogeneity and use it in the completion and production of their wells.

The shale gale is real, and continuous improvements in the economics of the extraction and production of natural gas and oil from unconventional resources will continue to be an inevitable surprise.

As American author Mark Twain once said, “It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.”