1. Drilling Experience and Lessons Learned from Key US Shale Plays
Quan Guo and Jim Friedheim
M-I SWACO, A Schlumberger Company
Buenos Aires, 9 de agosto de 2012

2. Drilling experience from key US shale plays
Agenda
Introduction
Gas shale is different from conventional shale
Every gas/oil shale is different
Drilling experience from key US shale plays
Eagle Ford
Haynesville
Marcellus
Lessons learned from US shale play drilling
Summary and Conclusions

3. Key Challenges for Shale Gas
Technical
Economic
Environmental

4. Moderate Reactivity shale
Gas/Oil Shale is Different
High Reactivity Shale
Massive structure
Lack of bedding planes or evident laminations
Soft
Plastic
Sticky
CEC >20 meq/100g
Predominance of Smectite
Moderate Reactivity shale
Moderate laminated structure
Bedding structure
Easily broken
Not plastic
CEC meq/100 g
Presence of smectite and Illite approximately similar proportion
Low Reactivity Shale
Strongly laminated structure
Fissile
Brittle (Break along lamination)
Hard and firm consolidation
Not sticky
CEC <10 meq/100g
Predominance of illite
Unconventional resource requires unconventional thinking

5. Every Shale Play is Different
Haynesville
Depth = 10,500 – 13,500 ft TVD
MW = 15 – 16 ppg
Temperature = 300 – 325° F
Total Clay Content = 33%
Fayetteville
Depth = ~ 1,000 – 7,000 ft TVD
MW = 9 – 10 ppg
Temperature= ~ 135 ° F
Total Clay Content = 12%
Marcellus
Depth = 5,000 – 8,500 ft TVD
MW = 12 – 14.5 ppg
Temperature= ~ 180° F
Total Clay Content = 29%
Eagle Ford
Depth = 6,000 – 14,000 ft TVD
MW = 10 – 14 ppg
Temperature = 225 – 250° F
Total Clay Content = 8%
Barnett
Depth = 6,500 – 8,500 ft TVD
MW = 9.5 – 10.5 ppg
Temperature= ~ 180 – 220 ° F
Total Clay Content = 27%
Bakken
Depth = 11,000 ft TVD
MW = 10.5 ppg
Temperature= ~ 150° F
Total Clay Content = 16%

6. Drilling experience from key US shale plays
Agenda
Introduction
Gas/oil shale is different from conventional shale
Every gas/oil shale is different
Drilling experience from key US shale plays
Eagle Ford
Haynesville
Marcellus
Lessons learned from US shale play drilling
Summary and Conclusions

7. Eagle Ford Shale Over 200 horizontal wells from 31 operators
80% OBM & 20% WBM
Eagle Ford varies from 6000 to 14,000 ft TVD
Lateral length from to 6000 feet

8. Eagle Ford Shale
Drilling days varies from 15 to 36 days for WBM, or 15 to ~30 days for OBM, depending well length
OBM shows advantages for longer wells, but not so for shorter wells

9. Eagle Ford Shale
The industry is making progress over the years – Learn from the US experience!
Some operator performs significantly better than others – Learn from others!

10. Haynesville Shale Over 200 horizontal wells from 17 operators
85% OBM & 15% WBM
Haynesville shale varies 10,500 – 13,500 ft TVD
Lateral length from to 7000 feet

11. Haynesville Shale WBMs are mostly used for shallow wells.
OBMs are mostly for deep wells, because of HTHP.
Drilling days vary from 35 to ~50 days, depending on well length.
Total Drilling Days
Water Based Mud Wells TD
P10
P50
P90
8000
n/a 19
11000 27 30 41
13000 20 32 53
Oil Based Mud Wells
15000 35 51
16500 36 50
17500 42 63
19000 96

12. Haynesville Shale Haynesville shale is a HTHP shale gas play.
Again, the industry is making progress over the years – Learn from the US experience!

13. Marcellus Shale Over 200 horizontal wells from 13 operators
Most of the surface & intermediate holes are drilled with air or mist.
60% SBM & 40% WBM
Marcellus shale varies 5,000 – 8,500 ft TVD
Lateral length from to 8000 feet

14. Marcellus Shale WBM and SBM perform equally well.
OBM shows advantages for very long wells.
Large gap between gap among the better and worse performers for wells with similar depths.
The industry is still learning & has a large opportunity for improvement.

15. Drilling experience from key US shale plays
Agenda
Introduction
Drilling experience from key US shale plays
Eagle Ford
Haynesville
Marcellus
Lessons learned from US shale play drilling
Summary and Conclusions

16. In-Depth Analysis & Lessons Learned

17. Summary of Lessons Learned
Eagle Ford Shale
Over 200 wells from 31 operators were analyzed
Key wellbore instability issues are reactive Midway shale and mud loss in the Austin Chalk
These issues are managed by well design, drilling fluids selection and wellbore strengthening
Grinding and hole cleaning is a common problem for long horizontal wells
The industry is making progress over the years – Learn from the US experience
Some operator performs significantly better than others – Learn from others and know which partners to work with!

18. Summary of Lessons Learned
Haynesville Shale
Over 200 wells from 17 operators were analyzed
Key wellbore instability issues are gas kicks and loss circulation when transitioning to the Hosston and Cotton Valley formations
Drilling days varied from 25 to 50 days in majority of the investigated wells, depending on well length
Downhole tool failures due to HTHP, were the main causes for drilling days significantly over 50 days
OBM is the drilling fluids of choice, again, due to HTHP
The industry is making progress over the years
Some operator performs significantly better than others

19. Summary of Lessons Learned
Marcellus Shale
Over 200 wells from 13 operators were analyzed
Drilling days with WBM and SBM were very close
Key issues are wellbore instability while drilling the curve section and hole cleaning problems while drilling the horizontal section
Failure mechanisms from shale-drilling fluid interaction were de-lamination, resulting in “coffee-ground”-like cuttings
Removing “coffee-ground” cuttings from drilling fluids was difficult and made drilling fluids re-use a challenge and increased the cost of drilling waste disposal
No clear progress over the years in drilling days, or the industry is still learning to improve

20. Summary and Conclusions
Every shale play is different
Drilling data of over 1000 wells from key US shale plays have been analyzed, particularly with respect to drilling fluids (OBM vs WBM)
Key drilling issues and solutions have been identified for each of the shale plays
The industry is making progress over the years – Learn from the US experience
Some operator performs significantly better than others – Learn from others and know which partners to work with
Cutting grinding, hole cleaning and lubricity are the common problems for long horizontal wells
The total drilling days or well costs for similar wells can vary significantly, indicating a large opportunity for improvement

21. Gracias