4 minute read
A riddle wrapped inside an enigma
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COMMENT
A riddle wrapped inside an enigma
A2019 Deloitte Insights series, “Deciphering the performance puzzle in shales: Moving the U.S. shale revolution forward,” tells a well-known, but nevertheless hard-to-fully-take-in tale of rags to riches as an energy-dependent United States, in the span of a mere decade, transforms into a global energy giant.
“The advent and commercialization of hydraulic fracturing and horizontal drilling beginning in the Barnett Shale paved the way for rapid expansion in unconventionals starting in 2005,” says the Deloitte article. The latest U.S. reserve estimates are pegged at 1,280 Tcf of shale gas and 112 billion barrels of tight oil.
Deloitte maintains that the shales have “altered the entire oil & gas landscape, with the United States now projected to be energy independent by 2020. By mid-2019, U.S. tight oil production reached 8.5 million barrels per day or almost 10% of the world’s output.”
What was wrought
Shales are organic mudstones consisting of silt and clay that have a complex and heterogenous mineralogic accumulation and thickness, require custom engineering designs and completion stimulations, and are strongly guided by many above-surface planning and efficiency measures.
Drilling, completing, and producing shale or tight oil & gas wells has always been both an art and a science, says a 2017 paper from the Oxford Institute for Energy Studies, “Completion Design Changes and the Impact on U.S. Shale Well Productivity”.
Given a sub-$60 oil price environment, the paper goes on to say, this has never been truer. ”A combination of science, technological advancement, and brute force experimentation has led to broad productivity gains across the shale patch.”
One example is the reduction in speed to total depth time when drilling, coupled with increased drilling precision. However, the paper goes on to say, “the most meaningful advances made during the downturn are
KEVIN PARKER
EDITOR
related to completion designs. Operators and service companies continue to experiment with and tweak completion designs, usually resulting in positive outcomes. The use of greater sand (proppant) and water (fluid) volumes has paved the way to productivity gains in multiple plays and is probably the single largest contributor to recent productivity advances.”
What happens deep beneath the earth, however, remains something of a mystery, because the specific factors contributing to these gains are far less well understood, according to the Oxford Institute paper: “It is not the gains themselves that are in dispute, but what exactly is occurring beneath the surface to make these gains possible that remains subject to vigorous debate.”
Look ahead
What’s been happening isn’t a matter of debate for the folks at Deloitte, however. Operators, with the help of service companies, “have made huge strides in reducing their days per foot or lowering the shale cycle time by an average of 100 days. The planning and efficiency index has improved by 12 percent over the past five years.”
One area where debate continues is the relationship between engineering and completion intensity, including increased proppant loading. While the Oxford Institute paper says the relationship between increased proppant and additional productivity are largely accepted, Deloitte says the higher intensity designs and simulations have led to diminishing results.
From 2016 to 2018, almost 40% of oil & gas wells with high completion intensity ended up with below average productivity, Deloitte says.
The conclusion: operations will continue to tweak their methods. OG
INSIDE
EDITOR’S COMMENT
A riddle wrapped inside an enigma
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