Lost circulation, a major challenge in well construction, is the loss of drilling fluid into formation caused by wellbore hydraulic fracturing. Wellbore strengthening techniques can be applied to mitigate lost circulation by generating resistance to the growth of induced or natural fractures. In this paper, a fully coupled hydraulic fracture propagation model is presented to simulate lost circulation and wellbore strengthening. A near-wellbore stress analysis is performed to characterize wellbore mechanical responses during lost circulation. The analysis validates the hypothesis of hoop stress enhancement and emphasizes the impacts of poroelasticity involved in the stress enhancement. In addition, a novel approach integrating fracture resistance enhancement mechanism (i.e., tip protection) into hydraulic fracturing simulation is introduced and is used to quantify fracture gradient enhancement for drilling operations. Case studies are performed to assess different sealing conditions. Results show remarkable declines of fracture fluid pressure across the sealant and substantial reduction of fluid loss into the fracture. Case study concludes that fracture tip protection can be achieved through both fracture sealing and fracture fluid dissipation. Some operational insights on wellbore strengthening design are also extracted from this study.

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