August 20-22, 2006Kansas Independent Oil & Gas Association69th Annual MeetingWichita, Kansas, USA

August 31—September 2First International Oil Conference & Exhibition SPE & PEMEXCancun, MexicoBen Turner will present SPE 101781 “A Review of Over 100 Polymer Gel Injection Well Conformance Treatments in Argentina and Venezuela: Design, Field Implementation and Evaluation”

September 12, 2006PTTC Midcontinent Oil and Gas Expo and Prospect FairGreat Bend, Kansas, USATIORCO will be exhibiting.

September 19—21Congreso de ProducciónInstituto Argentino de Petróleo y GasMendoza, ArgentinaChuck Norman will discuss TIORCO’s Clay Stabilization Technology (KOH)

September 24-27, 2006SPE Annual Technical Conference and ExhibitionSan Antonio, Texas USA

ON THE CALENDAR

IMPROVED OIL RECOVERY PRODUCTS & SERVICES

ENGINEERED OIL REPORT

Volume 21, Number 2 Summer 2006Volume 21, Number 2 Summer 2006

Following very successful results from initial MARCITSM treatments of Kansas Arbuckle wells starting in 1997, the question inevitably arose as oil produc-tion slowly declined – What would hap-pen if we re-treated the well?

Many Arbuckle wells were initially drilled some 50 years ago, only to be shut in when they began producing too much water. Nine years ago, TIORCO began to use MARCITSM polymer gel technology to treat Arbuckle wells with impressive results. In excess of 90% of the more than 300 well treatments per-formed by TIORCO since the initial test have been successful, many paying off within a few days or weeks of treatment.

To date, more than 10 Arbuckle re-treatments have taken place. The chart below shows the results of a Bemis-

Shutts Field producing well in the Arbuckle Dolomite Formation. Prior to the fi rst treatment, the well was put back on production on the Arbuckle for a six-week period to establish a benchmark water-oil ratio and rate. Incremental oil produced following the initial gel treat-ment was nearly 15,000 barrels. In the fall of 2004, a second polymer gel treat-ment was implemented, preceded with an aggressive acid treatment.

Nearly 4,000 additional incremental barrels of oil have been produced in the 17 months following the second treat-ment, and it is estimated that the ulti-mate incremental oil recovery from the second treatment will approach 10,000 barrels. For more information on re-treat-ment of Arbuckle wells, contact TIOR-CO’s J. Portwood at 817- 312-1033.

Re-treatment of Arbuckle Wells Produces New Production Spikes

Multi-Year CDG Pilot Underway in China’s Shengli Field

TIORCO has signed a contract for a two and a half year colloidal dispersion gel pilot proj-ect in China’s Shengli oil fi eld. Design work for the project has been underway over the last couple years and will now be put into place.

The Shengli oil fi eld was discovered in 1961 and development started in 1964. By 1993, its output of oil accounted for one-fi fth of China’s total, thus becoming

continued on page 2

Jim and Mr. Du Rongguan shake hands at the conclusion of the signing.

Wasinger #5 Producing Well

the second largest oil fi eld in the country. The Shengli oil fi eld includes 20,443 oil

wells, with an annual crude oil production capacity of about 26.548 million tons. The average water cut of the entire fi eld is 90.2%, with a natural decline of 14.8%, and a composite decline of 5.6%. Like many mature fi elds originally developed in the 1960’s, considerable oil in place remains in the fi eld, but more sophisti-cated recovery technologies are required to economically produce the oil.

TIORCO has been active in China’s oil fi elds for more than a decade, spearheading CDG pilot programs in the Daqing fi eld in the 1990s. TIORCO also developed a gel treatment design and lab study for the Karamay fi eld in Western China and the Dagang fi eld in Eastern China.

Surinam Project Tests Use of MARCITSM Gels in Depositional Environment

The Repub-lic of Surinam, located north of Brazil on South America’s northeastern coast, is home to Staatsolie, the state oil company of Surinam. In February of 2003, TIORCO was awarded a contract to implement a producing well (water shut-off) MARCITSM gel pilot in the Tambaredjo Field, located approximately 80 Km. west of the capital city of Para-maribo.

The target formation is a shallow, unconsolidated sandstone with a strong natural water drive. There are few, if any,

gel case histories in this type of deposi-tional environment, since the MARCITSM

gels were developed primarily for applica-tion in naturally fractured sandstones and vugular carbonates. Four producing wells were treated in the 2003 pilot project. Although the operator prefers not to dis-close the details, the treatments signifi -cantly reduced water production with no decrease in oil production. The surprising outcome was that the reduction in water production has been sustained for four years.

In February of 2006, Tiorco’s Chuck Norman, Ron Scott, Kellan Seaton and Charlie Raper started the second pilot of 11 producing wells in different parts of the fi eld. The results of those treatments are under evaluation.

Multi-Year CDG Pilot Underway in China’s Shengli Fieldcontinued from page 1

Chuck Norman and Ron Scott on site in Surinam.Staatsolie technicians prepare a well for gel treatment.

TIORCO Moving to Larger Denver Facilities

Effective November, TIORCO will have a new headquarters and corporate address. TIORCO’s home offi ce and the TIORCO lab will be moving to 2422 S. Trenton Way, #H, Denver, Colorado 80231. Phone numbers will remain the same.

The new location will increase the square footage of the offi ce by over 50%, accommodating additional staff and an expanded laboratory facility. If you are in town, we welcome an opportunity to show you our new facility.

TIORCO President Jim Mack signs the CDG pilot contract with Ms. Tangying, Mr. Zhu Yanywen, and Mr. Huang Jianrong.

J. Portwood Marks 10th Anniversary with TIORCO

In 1996, TIORCO was pleased to wel-come J. Portwood to the staff as Southern Region Manager. We are even more pleased to celebrate J.’s 10th anniversary

with our fi rm. A graduate of the Univer-sity of Texas at Austin with a BS degree in geology, J. initially worked as a geolo-gist and soon found exploiting proved producing reserves to their maximum potential the most intriguing and reward-ing part of the oil fi eld equation. After seven years in biological surfactant tech-nology aimed at improving oil recovery, J. joined TIORCO.

“What I have most enjoyed over the past 10 years is working with new cus-tomers to implement successful projects in Texas, Kansas, Oklahoma and New Mexico. These were geographic areas where TIORCO had done little previous work but there were clearly fi elds in need of TIORCO’s expertise,” says J.

New offi ce site

Review of 100 Polymer Gel Treatments in Argentina and Venezuela

By Chuck NormanManager for the Latin America Division of TIORCO

Certain polymer gels are believed to be applicable exclu-sively in naturally fractured reservoirs.

High permeability anomalies in matrix reservoirs, however, are also candidates for gel treatments based on the results of polymer gel technologies applied in sev-eral Latin American reservoirs, represent-ing a broad range of depositional environ-ments and petrophysical characteristics.

In a new SPE paper 101781 – A Review of Over 100 Polymer Gel Injec-Review of Over 100 Polymer Gel Injec-tion Well Conformance Treatments in Argentina and VenezuelaArgentina and Venezuela, applications of two of the most widely used polymer gel technologies; MARCITSM and Unogel are reviewed. These technologies were used in three basins in Argentina and the Lake Maracaibo basin in Venezuela.

While polymer gels are not a panacea, they are one of the few technologies that can be applied to reduce heterogeneities deep in the reservoir. The primary objec-tive of any polymer gel treatment is selec-tive permeability reduction. Combined with other reservoir management strate-gies, the treatments can improve overall oil recovery effi ciency.

Projects implemented in the Latin American reservoirs have shown that gels with signifi cantly lower polymer concentrations can be extremely effective in heterogeneous matrix (unfractured) reservoirs, especially if the gels exhibit colloidal dispersion gel qualities. Oil rate and water-oil ratio response times for gel treatments in matrix reservoirs ranged from three to 18 months, depending on well spacing and thief zone permeability.

Argentina’s Gulfo San Jorge BasinThis is the most prolifi c basin in Argen-

tina, having produced over 3 billion bar-rels of oil and approximately 3 tcf of gas since the initial discovery in 1907. More than 26,000 wells have been drilled in the basin, however, waterfl ood recovery is generally low due to the combined effects of reservoir heterogeneity and, in many fi elds, an adverse mobility ratio.

In the Jose Segundo Field, 2004 gel

treatments by TIORCO on two wells were termed moderately successful by the oper-ator. Based on these results, a second well treatment was initiated in April of 2006.

In the basin’s Diadema Field, three adjacent injection wells were treated with MARCITSM gels in February of 2005 with signifi cant oil response noted in several offset producing wells within 2-3 months after the treatments. Although results of the fi rst gel pilot remain confi dential, the operator initiated a second, signifi cantly larger, MARCITSM gel project in February of 2006, indicating that the fi rst pilot was very encouraging.

November 2005 MARCITSM gel treat-ments completed in two injection wells in the El Tordillo Field resulted in a decrease in the WOR and an increase in the average oil produc-tion rate. As of May 2006, the operator esti-mated that incremental oil was approximately 63 BOPD with a payout period estimated at four months.

Argentina’s Neuquina Basin

Waterfl ooding began in the Charco Bayo/Pie-dras Blancas Field of Argentina’s Neuquina Basin in 1975. After 30 years of waterfl ooding, less than 20% of the original oil in place had been recovered. Initial gel treatments were performed from late 1999 to Sept. 2000, using MARCITSM gel technology.

Based on those pilot projects, more than 40 additional injection well treat-ments were completed from 2002 through 2005. These gel treatments proved lower concentration, larger vol-ume gel treatments very effective in improving volumetric sweep effi ciency, particularly in the Charco Bayo structure. Retreatment of injection wells in the structure have been as successful as the initial treatments.

Venezuela’s Maracaibo BasinThe Maracaibo basin of northwestern

Venezuela is one of the most produc-tive hydrocarbon basins in the world.

Oil in place has been estimated to be in the range of 300 billion barrels. As of 2001, primary and secondary recovery totaled approximately 31% and 7% OOIP respectively.

In 2000, a pilot area was selected for a polymer gel pilot using the Unogel technology because of the reservoir temperature of 275ºF (135ºC). Based on costs of well preparation, chemicals, supervision and offshore pumping units, the authors believe the project resulted in incremental oil at a cost of less than US$3.00/barrel.

While these and other projects reviewed in the paper demonstrate that low concentration gels can be effec-tive in low permeability heterogeneous reservoirs, some waterfl ood problems

cannot be corrected. For example, if a pattern has not responded well to water injection, a gel treatment will probably not be effective. Those projects that failed tended to do so for several reasons including:• Poor connectivity in the pattern.• Permeability of thief zones is too low

for gel injection.• Gel volume is too small (if WOR curve

shows low breakthrough, a small gel treatment will not solve the problem).

• High oil recovery.

TIORCO’s Lab Manager Ben Turner will be presenting SPE 101781 at the SPE & PEMEX First International Oil Conference & Exhibition, August 31-September 2 in Cancun, Mexico. For more information, contact TIORCO at tiorco@tiorco.comtiorco@tiorco.com or 800-525-0578.

Oil response in Maracaibo Basin

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Andrita Scofi eld Joins TIORCO Lab Team

What does it take to be a fi rst-rate lab technician? Andrita Scofi eld sums it up:• Patience• A high tolerance

for tedious work• Attention to detail,

and• Common sense.

“You have to recognize when some-thing isn’t working right,” Andrita explains.

Andrita joined TIORCO as a Lab Tech-nician this summer, expanding our Den-ver lab team and bringing more than 10 years of laboratory experience to her job. A geologist by training, Andrita gradu-ated with a bachelor of science degree in geology from Colorado State University in 1993, but soon gravitated to lab work. She has extensive experience in water quality analysis as well as soil sample analysis and an excellent reference in the person of long-time associate and TIORCO lab technician Liz Moore.

Off the job, Andrita’s an equestrian.

In fact, she competed as a member of CSU’s equestrian team throughout col-lege including hunter jumper competi-tions. Ten years ago, she began dressage and this summer, Andrita took fi rst place in intro-level dressage. Making the win even more exciting was the fact that it was the fi rst time she showed her Olden-burg fi lly that she had raised from a nine-month old weanling.

Wedding Bells RingCongratulations to TIORCO Field Tech-

nicians James Fuqua and Thad Scott on their recent marriages!

James Fuqua and Karen Bellerive were wed April 22 in Plainville, Kansas and are now making their home in Natoma, Kansas. When asked what attracted him to Karen, James simply says, ”Every-thing. She’s great.”

Thad Scott and Heidi Tilford decided to turn their three-year friendship into a permanent relationship on June 7th

in Las Vegas. Along with a new bride, Thad increased his family with two new stepchildren, Kevvis Cheryl and Shawn Bufford.

Daniel Chen Interns in TIORCO’s Lab

Intern Daniel Chen has been a welcome addition to the TIORCO lab team over the sum-mer. His focus has been running lab experiments for the properties of

different polymers and researching data on the Internet. Daniel will be a senior this fall at D’Evelyn Senior High School in Denver. He attended the Colorado School of Mines one-week “Futures in Energy” camp earlier this summer and was referred to TIORCO for an internship by one of the program directors. Based on Daniel’s quick grasp of what is needed and his strong work ethic, we expect to see him do well in his chosen college and future career.

TIORCO President Jim Mack Honored as Denver Rotarian of 2005-2006

Denver Rotary Club 31 honored TIOR-CO’s president Jim Mack as Rotarian of the Year, recognizing his exceptional contributions to the Club and the local community. Jim has been a member of Club 31 for over 21 years and served as Club President in 1999-2000 and DRCF President in 1996-1997. He has par-ticipated on the Club Strategic Planning Committee, the Branch Rickey Award Committee, AOA, and Social Activi-ties. Probably most noteworthy, Jim has chaired the Vocational Scholarship Com-mittee for the past four years. He initi-ated and organized this committee into a strong team of mentors for Career Educa-tion Center students, as well as raising the initial funds to provide scholarships. Other commendable community service work includes serving on the National Board of the Samaritan Institute, as well as being President Elect on the board of Denver Kids, Inc.

The Engineered Oil Report is a controlled free news publication of:

TIORCO, Inc. Southern Region1795 W. Warren Avenue 817-337-0032Englewood, CO 80110 Fax 817-337-0064303-935-0046800-525-0578Fax 303-935-1514www.tiorco.com • email tiorco@tiorco.com

Corporate Offi cersJim Mack – PresidentChuck Norman – International Sales ManagerJT Portwood – Southern Region Manager