Making an efficient and wise concept selection decision—quickly selecting the right project—is often of equal or greater importance than later design and execution tasks for determining project success. Value lost from a suboptimal concept selection decision or from a needlessly prolonged decision process is independent of value generation opportunities during design and execution, and cannot be recouped during later project phases. This paper presents decision framework and production forecasting processes that complement one another, and promote an efficient and high-quality concept selection decision for tight or unconventional resources. The method is for both oil and gas resources, and is especially useful for assessing and developing large contiguous tracts.

High quality production forecasting is very important during concept selection. Better quality concept selection decisions will also result if the alternative conceptual plans are equally optimized when the decision is made, and our assessment process facilitates both accurate forecasting and equal optimization of the various development alternatives. Our method includes symmetry element reservoir simulation models and an efficient economic spreadsheet model with an optimizer. The sector simulation models run fast and can evaluate many cases, but they still explicitly address the physical effects relevant to flow in porous media with vertical, transverse, hydraulic fractures intersecting horizontal wells. The decision framework is structured so that some decisions are independent of the simulation model, and those decisions are rapidly optimized within the economic model. We introduce a fracture efficiency factor which may be important for modeling the diminished performance observed as the number of stages increase in multi-fractured horizontal wells. This fracture efficiency factor may also be an important discriminator of performance between wells fractured using aqueous vs. non-aqueous fracturing fluids. We also show how to use meaningful constraints with a symmetry element model to ensure that the economic forecasts are both realistic and achievable.

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