Abstract

Multilateral well technology is considered a development strategy as the oil and gas industry is increasingly approaching more hostile environments. It remains attractive to maintain efficient exploration of oil and gas fields in order to maximize profitability with minimum uncertainty. Some of the non-conventional oil and gas reservoirs currently being drilled are characterized by significant heterogeneity, tight and naturally fractured, faulted/compartmentalized, heavy oil and, depleted reservoirs/mature development. However, sometimes the high risk involved accompanied by economic disadvantages have diminished the ability of multilateral wells to maximize access to reserves without incurring higher development costs.

The objective of this study is to develop a methodology to assist engineers in their decision making process of maximizing access to reserves. The process encompasses technical, economic and risk analysis of various alternatives in the completion of a well (vertical, horizontal or multilateral) by using a well performance model for technical evaluation, and a deterministic analysis for economic and risk assessment.

In the technical part of the decision making process, the flow rate for a defined reservoir is estimated by using a pseudo-steady state flow regime assumption. The economic analysis departs from the utilization of that flow rate data assuming certain pressure decline. Financial Cash Flows (FCF) are generated to measure the economic worth of investment proposals. Net Present Value (NPV), Internal Rate of Return, Profitability Index and payback period are the main economic yardsticks used in the analysis.

Last, a deterministic decision tree is used to represent the risks inherent in geological uncertainty, reservoir engineering, drilling, and completion for a particular well. The NPV generated from the economic analysis is used as the base economic indicator. In addition, the risk associated at each stage of the project is considered with an assigned probability. By selecting a type of well that maximizes the expected monetary value (EMV) in a decision tree, we can make the best decision based on a thorough understanding of the prospect.

The method introduced in the paper emphasizes the importance of a multi-discipline concept in drilling, completion and production technology. The examples presented in the paper will assist geologists, geoscientists, engineers, and managers in collaborating together in a development project.

Introduction

To efficiently develop oil and gas fields, each reservoir must be evaluated with a well planning, drilling and completion system that maximizes hydrocarbon recovery. Several alternatives can be selected based on the feasibility of the system, revenue versus cost, and risk or uncertainty involved. In order to properly analyze and evaluate a project, it is imperative to first study the reservoir performance followed by an economic and risk analysis; keeping an emphasis on the relationship among them.

In this paper, we use a single well system to evaluate a project based on a process that integrates three steps (performance estimation, economic analysis and risk assessment). First, a well performance model combined with pressure decline rate is used to calculate cumulative production for a selected system. Next, the revenue from the production and the cost for the defined system is used to conduct an economic calculation to generate NPV for the project. Finally, the uncertainties involved in the conditions and properties of the reservoir, drilling, completing and operating the well are considered in a risk assessment to aid in making decisions about the development plan. The geological aspects include structural complexity of faulting and folding, compartmentalization, natural fracture network, lateral extent of the reservoir, and lithology of target formation. The reservoir engineering considerations refer to horizontal and vertical permeability (kh and kv), porosity, reservoir pressure, decline rate, and fluid properties. The drilling feature consists of junction stability, debris management, re-entry feasibility, laterals isolation, tubular capacity, and wellbore stability. Furthermore, mechanical integrity, control of sand production, stimulation, and ability to implement the lifting mechanism are included in the completion aspect (Brister, 2000).

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