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What is Important in the Reservoir for CO 2 EOR/EGR and Sequestration? Presented by: Richard Baker Prepared for APEGGA Annual Conference GHG Opportunities:

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Presentation on theme: "What is Important in the Reservoir for CO 2 EOR/EGR and Sequestration? Presented by: Richard Baker Prepared for APEGGA Annual Conference GHG Opportunities:"— Presentation transcript:

1 What is Important in the Reservoir for CO 2 EOR/EGR and Sequestration? Presented by: Richard Baker Prepared for APEGGA Annual Conference GHG Opportunities: Small and Large Technologies April 22-24, 2004

2 Outline Conclusions Conclusions Field CO 2 EOR response Field CO 2 EOR response Determination of Incremental Reserves Determination of Incremental Reserves Incremental CO 2 Response RF vs. HCPVI Incremental CO 2 Response RF vs. HCPVI Typical cash flow for CO 2 /EOR Typical cash flow for CO 2 /EOR CO 2 sequestration CO 2 sequestration What are the most important factors? What are the most important factors? Summary Summary

3 Conclusions 1. There has been very good to excellent response on many USA/Canadian CO 2 floods to date in a wide range of conditions 2. CO 2 is a mature technology in USA and in Canada it will be mature in years 3. Early time response often control CO 2 economics 4. There is wide variations in early time response between various fields. Early time response is a function of heterogeneity, current oil saturation and injection rates.

4 Conclusions 4. Forty plus years of EOR (CO 2 + HC) miscible have shown that the controlling factors in CO 2 economics are (early time response); 5. Reservoir heterogeneity a) Remaining oil saturation b) CO 2 price c) Infrastructure d) Well bore integrity 6. Screening needs to include historical field response and level of depletion as well as infrastructure and mapping of current oil in place 7. Concerns about CO2 emissions will force action 8. Cooperative approach will aid implementation

5 Options for CO2 Usage/Disposal EOR GOBCBM EGR ‘Value Added’ ‘Rental of pore space’ Regulatory driven CO2 Emission

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8 Response time Peak oil rate

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10 Time to peak oil rates time response

11 CO2 Flooding – World Wide 75 Projects worldwide 194,000 Bbl/d 66 in US From Jarrell et al, ‘Practical Aspects of CO2 Flooding’

12 Total oil rate Incremental oil rate SPE paper CO 2 Flood Performance

13 Total oil rate Incremental oil rate Hansford Marmaton = secondary, low initial pressure, low permeability reservoir CO 2 Flood Performance

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15 Comparison Normalization of CO 2 behaviour Cum. oil Vol. of original oil Cum. injection Vol. of reservoir For comparison purposes

16 SPE paper 35391, SPE monograph Stalkup, SPE paper 26391, and Epic’s interpretation How Do These Floods Compare to Each Other?

17 What’s Different between Texas and Canadian Reserves Infrastructure Infrastructure Thicker continuous net pay Thicker continuous net pay General geological environment General geological environment Depth Depth Temperature Temperature Some of the best Canadian have already miscible flooded Some of the best Canadian have already miscible flooded Horizontal wells Horizontal wells Rules of thumb Rules of thumb

18 So What is Important ? Initial Response drives payout time

19 Important  The major objection to CO 2 by oil producers is long pay out times not producers is long pay out times not necessarily total reserves or NPV necessarily total reserves or NPV  initial oil response  large capital exposure

20 What’s worked in Western Canada in the Petroleum Industry? Short pay out time Short pay out time Good to excellent local knowledge of the reservoir/geology Good to excellent local knowledge of the reservoir/geology Very good execution of plans Very good execution of plans Using technical edges; horizontal well/3D seismic/screw pumps Using technical edges; horizontal well/3D seismic/screw pumps Economy of scale (shallow gas or heavy oil drilling) Economy of scale (shallow gas or heavy oil drilling)

21 Disjoint between Government and Industry If CO2 capture and geological storage is to play a significant role in mitigating global emissions, then the quantity of CO2 place in geological storage will need to approach 10 Gt/yr worldwide roughly 300 times the current rate of CO2 injection for EOR. D. Keith and M. Wilson Nov Mt/yrvs. 10,000 Mt/yr ~ target {1.79 Bcf/d}{527 Bcf/d}

22 Disjoint between Government and Industry  Global screening techniques  Research focused  Regulation focus  Specific field screening  Field experience critical  Large capital expense  CO 2 flood payout  Keeping low costs ($/bbl) SUGARvs.SALT

23 Use the Past to Forecast the Future What is the classical Screening Criteria?  API gravity  Current reservoir pressure  Depth  Oil saturation But what about Heterogeneity?

24 T. Bu, I. Soreide, T. Kydland: “IOR Screening: What Went Wrong?”, Norsk Hydro E & P Norway, Steering Committee of the European IOR Symposium, This paper was prepared for presentation at the European IOR Symposium in Moscow, Russia, October 27-29, 1993 “ The most common screening methods are reviewed and some shortcomings are pointed out. One important aspect is that more effort should be put on mapping of remaining mobile oil in the reservoirs and methods for producing these resources.” “ The most common screening methods are reviewed and some shortcomings are pointed out. One important aspect is that more effort should be put on mapping of remaining mobile oil in the reservoirs and methods for producing these resources.” “not taking heterogeneities into account in realistic manner” “not taking heterogeneities into account in realistic manner” Screening

25 What is the most important for CO 2 EOR? – Initial oil response (response time/peak oil rate); current oil saturations and injection rates – Permeability/Reservoir heterogeneity – CO 2 price – Infrastructure

26 Some Info on CO2 Sequestration Which reservoir should I inject in?Oil & Gas Known  Seismic  Core  Prod Minimizes risk Deep Saline Unknowns Long term liability increased It is better to have the devil that you know than the one you don’t.

27 Summary 1.Early time response (<5 yrs) is critical to CO 2 flood economics 2.Early time response is a function of heterogeneity, current oil saturation and CO 2 injection rates 3.Because of point 2 above; screening needs to include historical dynamic reservoir performance 4.Screening needs to include historical field response and level of depletion as well as infrastructure and mapping of current oil in place  Beware of averages 5.There is a large disjoint between expectation and reality between oil producers and government, in term of  CO 2 volumes and rates  Cost and economics  Historical trend (timing/phasing of projects)

28 #Reservoirs vs. screening criteria ROIP>10 MMSTB ROIP > 5 MMSTB 743 pools 1218 pools API Gravity > 25 º 391 pools 723 pools Reservoir Temperature < 93ºC 376 pools 694 pools Mean Formation Depth > 610 m 374 pools 691 pools Current Recovery Factor > 25% 125 pools 213 pools Exclude pools with previous miscible floods 85 pools 164 pools 9067 Pools (Alberta 2000 Oil Reserves Database)

29 Infrastructures: CO2 Sites & Sources

30 Source: Bachu, 2001 (EUB)

31 Source: Waldie, 2003 (Combustion News)

32 Source: Bachu, 2003 (AGS)

33 CO2 Flood:Tools Available PRIze PRIze CO2 Prophet CO2 Prophet Kinder Morgan Predictive Tool Kinder Morgan Predictive Tool Epic CO2 Analysis Package Epic CO2 Analysis Package

34 Epic CO2 Analysis Package: Technical Analysis Develop Injection Patterns Preliminary Screening Data Collection Input Reservoir, Fluid & Production/Injection Data Calculate & Evaluate Production Forecasts Proceed To Economic Analysis

35 Economic Analysis Input Production & Injection Profiles Input Capital Costs & Economic Parameters Calculate Economics Evaluate economics results

36 Salient Features Uses current water saturation Uses current water saturation Uses current reservoir pressure Uses current reservoir pressure Can model WAG floods Can model WAG floods Program can be validated where CO2 flood history exists Program can be validated where CO2 flood history exists Screening, technical analysis & economic evaluation tied-in Screening, technical analysis & economic evaluation tied-in

37 Base Case Example Economics Describe the base case Describe the base case – ROIP = 10 MMBBl – CO2 price: Cdn $1.50/Mscf – Oil price: Cdn $30/bbl – CO2 Recycling Cost: Cdn $ 0.40/Mscf – Percent CO2 Recycled: 90% – Discount factor: 15% – Royalty rate: 16.7% What areal size does this correspond? – Assume OOIP = 15 MMSTB (30% RF) – h = 6 m (20 ft) – Porosity = 15% – Swi = 30%  Areal extent 1,050 acres (  1¾ section)

38 Validation (Joffre Viking, AB)

39 Validation (North Cross, TX)

40 Production/Injection Profiles

41 Payout versus CO2 & Oil Prices  t < 1 yr  t > 5 yrs

42 Payout versus CO2 & Oil Prices

43 NPV versus CO2 & Oil Prices (Capital = MM$11)

44 ROR versus CO2 & Oil Prices

45 Effect of Royalty (1%)

46 ROIP increased 10 times; 100 MMSTB ROIP increased 10 times; 100 MMSTB Sensitivity To ROIP

47 ROIP 100 MMSTB; Royalty 16.67%

48 – – Royalty reduction will be beneficial to small size pools – – Following economic parameters emerged out of this study: Oil price: $30 CO2 price: $1 – 1.50/MSCF Payout: 5 – 10 years ROR: 15 – 30 years – – CO2 should be attractive for small size pools (ROIP  10 MMSTB) Highlights – Economic $creening

49 Some Recent Developments Streamline modeling of miscible 475,000 cell model, ~600 wells Run time ~70 minutes Compositional modeling Sector Model 40,000 cell sector model Run time ~ 10 hours FDP delivered in <5 months

50 Summary 1. Concerns about CO2 emissions will force action 2. CO2 flooding is a mature process used successfully worldwide for >35 years 3. CO2 infrastructure to be developed in Alberta 4. Cooperative approach will aid implementation 5. Approximately reservoirs are good candidates from initial screen 6. Generic economics positive - Site specific economics the next step


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