Optimization of CBM Reservoir Exploration and Development Strategies through Integration of Simulation and Economics
- Christopher R. Clarkson (Burlington Resources Canada) | J. Michael McGovern (Burlington Resources)
- Document ID
- Society of Petroleum Engineers
- SPE Reservoir Evaluation & Engineering
- Publication Date
- December 2005
- Document Type
- Journal Paper
- 502 - 519
- 2005. Society of Petroleum Engineers
- 5.8.3 Coal Seam Gas, 5.1.1 Exploration, Development, Structural Geology, 5.4.2 Gas Injection Methods, 5.4 Enhanced Recovery, 1.6 Drilling Operations, 5.6.3 Deterministic Methods, 5.1.3 Sedimentology, 1.10.1 Drill string components and drilling tools (tubulars, jars, subs, stabilisers, reamers, etc), 5.5.8 History Matching, 5.2.1 Phase Behavior and PVT Measurements, 2.4.3 Sand/Solids Control, 2.2.2 Perforating, 5.6.9 Production Forecasting, 4.6 Natural Gas, 5.5.2 Core Analysis, 5.2 Reservoir Fluid Dynamics, 5.5 Reservoir Simulation, 5.6.8 Well Performance Monitoring, Inflow Performance, 5.6.4 Drillstem/Well Testing
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The unique properties and complex characteristics of coalbed methane (CBM)reservoirs, and their consequent operating strategies, call for an integratedapproach to be used to explore for and develop coal plays and prospectseconomically. An integrated approach involves the use of sophisticatedreservoir, wellbore, and facilities modeling combined with economics anddecision-making criteria.
A new CBM prospecting tool (CPT) was generated by combining single-well(multilayered) reservoir simulators with a gridded reservoir model, Monte Carlo(MC) simulation, and economic modules. The multilayered reservoir model isdivided into pods, representing relatively uniform reservoir properties, and a"type well" is created for each pod. At every MC iteration, type-well forecastsare generated for the pods and are coupled with economic modules. A set ofdecision criteria contingent upon economic outcomes and reservoircharacteristics is used to advance prospect exploration from the initialexploration well to the pilot and development stages. A novel approach has beenused to determine the optimal well spacing should prospect development becontemplated. CPT model outcomes include a distribution of after-tax netpresent value (ATNPV), mean ATNPV (expected value), chance of economic success(Pe), distribution of type-well and pod gas and water production, reserves,peak gas volume, and capital. An example application of CPT to a hypotheticalprospect is provided.
An integrated approach also has been used to assist with productionoptimization of developed reservoirs. For example, an infill-well locating tool(ILT) has been constructed to provide a quick-look evaluation of infilllocations in a developed reservoir. ILT, like CPT, is used for multiwellapplications, combining the single-well simulator with a multilayered reservoirmodel and economics. An application of ILT to a CBM reservoir is provided, andthe results are compared with the predictions of an Eclipse reservoirsimulation.
CBM reservoirs have a relatively short history of development compared toconventional reservoirs; therefore, few analog fields may be relied upon forextrapolation to new basins and new plays. Further, key reservoir propertiessuch as absolute permeability vary greatly within and between existingdeveloping basins, which complicates prediction of these parameters for newplays. The production performance of CBM reservoirs in new plays or basins, inwhich few reservoir data exist, is correspondingly difficult to predict.
Existing conventional reservoir fields cannot be relied upon as analogs forCBM play analysis because coal-gas reservoirs differ from conventionalreservoirs in their fluid-storage and -transport mechanisms. Coals act assource rocks and reservoirs to gas, and a significant amount of gas may bestored in the adsorbed state relative to the free-gas state. CBM reservoirs areoften naturally fractured and may be modeled as dual-porosity, or eventriple-porosity, reservoirs. Gas-transport mechanisms vary depending on thescale and location within the reservoir. For example, gas transport at thescale of the matrix between natural fractures is caused by the mechanism ofdiffusion, whereas Darcy flow occurs in the fracture system. Single- ortwo-phase (gas and water) flow can occur, and, hence, relative permeabilitycharacteristics are important.
Permeability and gas content are two critical parameters that dictate theeconomic viability of CBM reservoirs. Unfortunately, there are many controlsupon these parameters. For example, gas content is a function of the amount oforganic matter within these rocks, the organic matter composition, organicmatter thermal maturity, in-situ PT conditions, gas composition, and matrix andfracture gas-saturated porosity. Absolute permeability is dependent uponnatural-fracture existence, frequency, orientation (with respect to in-situstress), and degree of mineralization. Natural-fracture permeability is alsostress- and/or desorption-dependent. Although the range of expected parametervalues for a new unconventional play may be reduced by knowledge of basinhydrodynamic characteristics, tectonic regime, local and regional stratigraphyand sedimentology, local and regional structural geology, and existingproduction within the basin, the uncertainty associated with key reservoirvariables is still likely to preclude a deterministic evaluation of reservoirproducibility and recoverable reserves.
Because of the variability in reservoir parameters that could be expectedwhen exploring for CBM in existing or new basins, it is natural to use astatistically based (stochastic) approach in the prediction of gas in place,recoverable reserves, well performance, and economic return. A comprehensivestudy by Roadifer et al. demonstrated the use of MC simulation for screeningkey parameters affecting CBM production.
Well performance is a key factor determining the economic viability of CBMreservoirs. Accurate prediction of well performance is required for developmentstrategies such as optimized well spacing, completion gathering system, andwellsite design.
The current work discusses how to integrate reservoir simulation andeconomics for the purpose of optimizing CBM exploration and developmentstrategies. Central to the discussion is the use of single-well (multilayered)simulators, which were constructed in Excel* and incorporate many attributes ofCBM reservoirs. These single-well (tank) models are discussed in the followingsection and have some utility for exploration and development applications whenused on their own, but they are particularly powerful when integrated withreservoir, surface, and wellbore models, MC simulation,7 and economics. Two newtools (CPT and ILT) described in this work are examples of integrated tools forapplication to exploration and development, respectively.
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