cuadrilla design values
TRANSCRIPT
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Shale Gas Exploration
and Hydraulic Fracturing
Eric Vaughan, Well Services Director
IMechE May 13, 2014
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Who is Cuadrilla
What is Unconventional or Shale Gas
UK Shale Gas Areas
Hydraulic Fracturing
Economics
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Cuadrilla who we are
Formed in 2007, UK company Early entrant to shale gas in Europe
Prospective and diversified acreage portfolio
Partnered with government and backed by
industry-specialist funds
Exploration assets Netherlands 680,000 acres
Bowland basin 293,000 acres
Weald basin 192,500 acres
Poland 440,000 acres
http://www.cuadrillaresources.com/person/a-j-lucas/http://www.cuadrillaresources.com/person/a-j-lucas/http://www.cuadrillaresources.com/person/riverstone-llc/http://www.cuadrillaresources.com/person/riverstone-llc/ -
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What is Unconventional or Shale Gas?
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Why is Hydraulic Fracturing Needed?
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Gas emanating from visible fractures
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UK Shale Gas Areas
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Earliest UK Shale Gas Well - 1875
Source: Professor Dick Selly, Department of Earth
Science and Engineering
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DECC/BGS Shale Gas Study
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Bowland Basin
National Grid High Pressure Gas Pipe Locations
Key:A. Thistleton-1
B. Hesketh-1
C. Banks-1
1. Preese Hall-1
2. Grange Hill-1Z
3. Becconsall-1Z
4. Annas Road-1 HZ
5. Elswick-2 HZ
Correct geology
Legacy 2D seismic Age and depth of shales
History of wells drilled
Thistleton-1
Banks-1
Hesketh-1 Elswick-1
History of oil and gas production in
area
Formby Oilfield
Off-shore production
Elswick-1
National Grid has over 190,000 km
of pipelines
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Trying to increase surface area of
reservoir rock exposed to wellbore.
150 foot section of reservoir exposed in8 inch hole is only 333 ft2.
Early Fracturing not really hydraulic!
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Precursor Fracturing Technology
November 1866 Patent for Roberts
Torpedo
Initially used gunpowder and later
nitroglycerin Filled borehole with water to provide
fluid tamping
Pennsylvanias Otto Cupler Torpedo
Company shot its last oil well usingliquid nitroglycerin in 1990
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Bigger Toys Fracturing Technology
Gasbuggy-1967
29 kilotons
Rulison-1969
43 kilotons
Rio Blanco-1973
3 by 33
kilotons each
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Hydraulic Fracturing
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What is Hydraulic Fracturing?
According to the United States Environmental Protection
Agency (EPA) hydraulic fracturing is a process to stimulate a
natural gas, oil, or geothermal energy well to maximize the
extraction.
Main purpose is to increase the effective surface area of the
wellbore to allow oil and gas to flow from the rock matrix into
the wellbore.
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Hydraulic Fracturing
Injects fluid into rock at a high enough pressure to cause therock to fracture.
Fluids can be water based, hydrocarbon based, acids,
liquid CO2, gaseous N2, foams and various combinations.
The fractures are held open with proppant after the hydraulicpressure is released.
Typically silica sand.
At greater depths or pressures, ceramic proppants can be
used.
Common sizes are 20/40 mesh (0.853mm-0.422mm) and
40/70 mesh (0.422mm-0.211mm)
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First Hydraulic Fracture Treatment
Stanolind OilCompany
Hugoton Gas
Field, Kansas
1,000 gallonsof naphthenic-
acid-and-palm-
oil (napalm)
and river sand
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Increase Stimulated Rock Volume
Stimulated Reservoir Volume 430 million ft3 withhigh viscosity cross-linked gel
Stimulated Reservoir Volume 1.4 billion ft3 with
low viscosity slickwater
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Frac Mine Back Experiments
(Warpinski, 2011)
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Monitoring Frac Height Growth
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Generate the Hydraulic Pressure
8,000 foot vertical depth well with 14,000 feet of
measured depth.
Fracturing fluid is fresh water.
5 inch monobore well casing.
Injection rate is 80 barrels (12.7m3) per minute.
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Generate the Hydraulic Pressure Typical shales require 0.8-1.1 psi per foot of vertical depth to
fracture.
With a fracture gradient of 0.9 psi/foot then 7,200 psi at
the formation is required.
The hydrostatic pressure of the water based fluid helps.
Just the water exerts 3,464 psi.
This leaves 3,736 psi required at the surface to pump thefractures open.
However, friction from the drag of the water along the walls of
the steel well casing increase this pressure.
Water only would generate 725 psi per thousand feet of
pipe or 10,150 psi.
With friction reducer this would be about 215 psi per
thousand feet of pipe or 3,010 psi.
Pumping surface pressure is 7,200-3,464+3,010=6,746 psi.
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Friction Pressure
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This is not a frac rig!
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Early Frac Pumps
1955 frac pump
manufacturing.
Remote
controlled
pumps powered
by war surplus
1,475
horsepowerAllison aircraft
engines
JPT December 2010
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Frac Pumps in the UK 1990s
First started in UK in 70s
Over 200 fracs performed on-
shore in the UK
Multi-stage, gelled
water frac,
Cheshire, UK 1992
Detroit 12v 149TI,
Allison Transmission,Triplex pump, 1,200
horsepower
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Frac Suite on Preese Hall-1
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Hydraulic Fracturing in Poland
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Hydraulic Fracturing in USA
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Frac Boats in the North Sea
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Example Horizontal Well Design
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Frac Sleeve
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Frac Sleeve
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P i P
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Pumping ProgramDate: 28-Mar-11
Job Num: 1
Meyers File:
Lower Worston Shale Stage Stage 1 Frac
Elap Cum. Stage Slurry Blender
Time Pressure Fluid Fluid Rate Conc. Prop Prop Comments/Fluidmin psi bbl bbl bpm psa lbs type
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Economics
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Growing gas import gap
Indigenous gas production supplies a
decreasing share of UK demand
(Source: Department of Energy and Climate Change)
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UK Energy Electricity vital but only 20% of energy demand
The challenge is much more than Keeping the Lights On
45%
31%
20%
4%
UK Final Energy Consumption - 2011
Petroleum
Natural Gas
Electricity
Other
Data Source Dept. of Energy & Climate Change
From 2011 to 2012 Electricity Generation
increased coal use from 29.5% to 39.3%
And decreased gas use from 39.9% to
27.5%
Renewables9.4%
Gas 39.9%
Nuclear 18.8%
Oil 1.0%
Coal 29.5%
Other 1.5%
2011 Shares of Electricity Generation
Renewables,
14.8%
Gas, 26.8%
Nuclear, 19.8%
Oil, 0.7%
Coal, 36.3%
Other, 1.5%
2013 Shares of Electricity Generation
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Renewables
11.3%
Gas 27.5%
Nuclear 19.4%
Oil 1.0%
Coal 39.3%
Other 1.5%
2012 Shares of Electricity Generation
Dont worry about the Russian gas
Other, 2.0%
Russia, 40.0%
EU, 1.0%
Australia, 6.0%South Africa, 1.0%
USA, 24.0%
Columbia, 26.0%
2012 UK Coal Imports
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55% of gas goes to heat and industry
36% gas goes toheat
36% of gas goes to
electricity andassociated uses
19% to industry and
other final customers 9% other
Use of Gas
Heat
Electricity
Industry
Losses
(Source: Department of Energy and Climate Change)
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Current Fuel Mix for National Electric Grid
(Source: http://www.gridwatch.templar.co.uk/)
05 May 2014
I di d ti li
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Growing gas import gap
Indigenous gas production supplies a
decreasing share of UK demand
(Source: Department of Energy and Climate Change)
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Send Billions of to the exporters or:
(Source: IoD calculations)
Potential contribution
from Shale
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On-Shore Gas Industry
Meaningful unsubsidized private investment (Bowland alone 50B through 2039)
Meaningful job creation (74K at peak)
Meaningful energy security contribution
Green completion standards
Small industrial footprint
(Source: IoD calculations)
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Community benefits
Local authority to receive 100% of business rates
Communities receive 100,000 for every exploration well
site that is hydraulically fractured
Communities receive one per cent of revenues from futureshale gas production Potentially, more than 1 billion over a 20 to 30 year shale gas production
timescale could be returned to Lancashire communities within the Bowland
Basin license area alone
The above is (broad brush) paid 2/3 locally, 1/3 to the
county (many specifics to be worked out)
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Thank you