1. 1. SUMMER 2014 OVERVIEW A Presentation by Matthew Hobbs and Derrick Shields
2. 2. AGENDA Utica Shale Play Basics Drilling Completions Bond Logs Toe Preps Hydraulic Fracturing Drillouts Production Multi-Well Sunk Costs Plunger Lift 2
3. 3. UTICA SHALE PLAY BASICS Depth: 7,000 ft - 8,000 ft Over 5 Empire State Buildings underground! Thickness: 70 1000 ft Production began in 2011 Over 300+ producing wells 7 drilling rigs in operation Why Horizontally Drill? Cost of $7 million per well 2:1 cost ratio vs. vertical 3.2:1 production increase vs. vertical Not limited by thickness TypicalWells Vertical Depths: ~7500 ft Measure Depth: ~13,000 ft 15,000 ft 3
4. 4. DRILLING Nomac 71: Yoder North Pad Patterson 329: Holmes Pad 4
5. 5. DRILLING After pad construction and before drilling rig in place, third party installs: Cellar 8 - 10 diameter 8 deep Enables the production tree to be accessible at ground level Conductor 20 diameter 50 - 100 deep Stabilizes wellbore from caving Cellar Conductor 5
6. 6. DRILLING Takes 4-7 days after rigging down at previous set up at current pad Costs about $300,000 to move and set up rig More than just rig set up 2/3 of 300 x 400 pad covered with containment Rig Mobilization 6
7. 7. DRILLING RIG PAD LAYOUT Mud Circulation Rig Casing Generators Mud Pumps Air Compressors Dog House Fluid Storage Trailers Drilling Rig Equipment Layout 7
8. 8. DRILLING Basic Principle Multiple layers of casing and cement Conductor Surface Intermediate Production Start large then decrease in size Visually looks like an extended telescope In Utica, casing sizes and approximate depths are constant Varies depending on play 8
9. 9. DRILLING Drill Bits Types: Tri-Cone Polycrystalline Diamond Compact Air Hammer Bit 9
10. 10. DRILLING Fluids types used Air Dusting Misting Foam Faster Rate of Penetration (ROP), Used from spud date to mud up point Water Based Mud Used above US ground water (USGW) protective depth Provides hydrostatic force to prevent kicks above USGW Synthetic Oil Based Muds Similar to OBM, more biodegradable Low formation damage Wellbore stability More environmentally friendly (biodegradable) Expensive Oil Based Muds Used below US ground water (USGW) protective depth Low formation damage Wellbore stability Less environmentally friendly Expensive 10
11. 11. DRILLING Mud Circulation Mud Pumps Stand Pipe Annulus DrillPipe Kelly Hose Separate Cuttings, Clean Mud Tanks 11
12. 12. DRILLING Parameters Recorded Hole depth Bit depth Hook Load (klbs) Pump Pressure Rate of Penetration (ft/hr) Torque (ft-lb) Weight on Bit (WOB) Differential Pressure Revolutions per minute (RPM) Strokes per pump Fluid gain/loss Monitoring System 12
13. 13. DRILLING Isolates oil, gas, and water zones from wellbore Float shoe guides casing through well bore Float collar One way valve that floats casing into well Prevents U-tubing of Spacer fluid Top plug and bottom plug Displacement fluid Centralizers Cementing the Casing Circulating Drilling Fluid Pumping Wash, Spacer and Cement Slurry Displacement Displacement Completed Job 13
14. 14. DRILLING Blowout Prevention Blind Ram Pipe Ram Spacer Spool Kill Line Choke Line Annular Mouse Hole 14
15. 15. COMPLETIONS Various Locations 15
16. 16. BOND-LOGGING Peterson Pad 16
17. 17. BOND-LOGGING Night cap installed and turned over to completions.Tubing head and bottom master valve installed. Attached to wireline and dropped into hole at a rate that allows for accurate measurements to be taken Can either be pumped down with pressure or fall due to gravity Lateral sections can only be reached if pumped down Tool Used Temperature Probe Stabilizer Gamma Ray Probe Stabilizer Stabilizer CasingCollar Locator (CCL) Cement Bond Log (CBL) Gamma Ray Spikes in shale formations Cement Bond Log (CBL) Uses acoustics to check the integrity of cement bond to casing Casing Collar Locator (CCL) Detects changes in magnetic field due to thickness change in casing collars 17
18. 18. BOND-LOGGING Interpretation Temperature Marker Joint Variable Density Log (VDL) Cement Bond Gamma Ray 18
19. 19. TOE PREPS Pitts Pad 19
20. 20. TOE PREPS Alternative toTubing Convey Perforations (TCP) Features hydraulically operated sliding sleeve Ran in production casing after drilling operations completed Provides means of establishing circulation to facilitate plugging and perfing first stage of frac operations 200psi) or explosion to shoot a pressure wave and determine liquid level Plunger tracking - determine fall velocity of plunger Slick line and braided line - clear tubing with broach, verify clear path with ring gauge, drop bumper springs, and perform fishing job Swabbing - way to free up loaded well U-tubing - utilize pressure in one well to unload a neighboring well 39