uncertainty analysis

Shell LearningShell LearningShell Learning C o p yr

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EP00

Volumetrics &

Uncertainty Management

EP00 - Introducing the E&P Businessp296


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EP00Terminology

STOIIP (GIIP) The volume of oil (gas) in an accumulation in a reservoir but corrected to the

volume it would occupy at surface temperature and pressure Ultimate Recovery (UR)

UR = STOIIP (GIIP) x Recovery Factor Reserves

Volume of oil or gas that remains at a specified date to be produced commercially from a field or area under prevailing economic conditions

Reserves = Ultimate Recovery - Cumulative Production

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EP00Why Volumetrics?

Knowing value of business Depreciation and Net Income calculation SEC reporting requirement Reserves Review (ARPR) Equity Determination Prospect Evaluation / Ranking Asset Management

Production Forecasting Field Development Planning


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EP00

Groups Resource Portfolio Build-up 1.1.2000

PRODUCEDEVELOPAPPRAISEEXPLORE

+/- 6 yrs to Prodn

ACQUISITIONS & DIVESTMENTS

UndiscoveredSFRc

*[bln boe]

DiscoveredSFRc

*Expectation

Undeveloped

*Proved

Undeveloped

*Proved

Developed* *bln boe

Externally Reported Figures

Yearly Production

UndiscoveredOutside Portfolio

Maturation Process needs to deliver ** bln boe/yr

+/- 10 yrs to Prodn


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EP00

Objectives

At the end of this session you should be able to: List sources of uncertainty and ways to

understand/manage them Use the STOIIP/GIIP expectation curves State the general justification of Appraisal


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EP00What do we need to know. ?


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EP00

STOIIP and GIIP Equation

( )o

ooo

B

SGNGRV

STOIIP o

=

p299

( )g

ggg

B

SGNGRV

GIIPg

=


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EP00Uncertainties in Volumetric Estimates

OWC?

Shale Out?

GOC?

Erosion?

DIP?

Seismic?

More Faults?

Fault Position?

STRUCTURALDip Error

Seismic ErrorFault Position

Additional Faulting

STRATIGRAPHICRock Development

Erosion

ACCUMULATIONPosition ContactsPossible Gas Cap

PROPERTIESPorosity

SaturationNet/Gross

Formation Volume Factors

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EP00

Dip Uncertainty

20Base Case

25Minimum

15Maximum

Seismic dip error 7 Dipmeter dip error 2


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EP00Top reservoir uncertaintyConger Garden Banks, GOM


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EP00

Fault Position Uncertainty

20Base Case

20

Minimum20

Maximum


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EP00North Cormorant Block IV : Development Strategies

0 1 2 km

Annex B - 1978(1974-75, 2D seismic)

1983-843D seismic

North CormorantPlatform

Oil producerWater injectorAbandoned with H/CSuspended with H/CPlanned producerPlanned injector

9 00 0

9000

WU

T10

000 7

1000

0

9500

ODT

9495

9500

6

2

5

6

5

2


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EP00

Sunrise-TroubadourWoodside

MOST LIKELY CASE - Fully Connected

INTERMEDIATE CASE - Large Compartments

WORST CASE - Small Compartments

Compartmentalisation Uncertainty


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EP00

Fault Dip Uncertainty

60

Base Case

70

Minimum

50

Maximum


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EP00

Fluid Contact Uncertainty

Base Case

Minimum Maximum


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EP00Uncertainty in top reservoir map3 development scenarios after appraisalDraugen Field, Norway

22 2

111

OWC

OWC

OWC

1600

1600

1620

1620

OWC

1620

1620

OWC

1620

1620

1600

1600 1620

1600

1600

1600

1620

OWC

10 PRODUCERS10 INJECTORS



OWC 1638MSS1600 CONTOUR VALUE, MSS

0 2 4

BASE CASE LOW CASE HIGH CASE

Uncertainty with Fluid Contacts

SHELL OU P.E. DEPT THE HAGUEWOMBAT FIELD

CONTOUR MAPTOP X SAND

0 1 km

Date: June 1996

Report No: 31-422

Author: L.B. van Dijk

Draw No: 12

all depths in m below sea levelN

GDT 2040m

OUT 2060mODT 2085m

WUT 2115m

2000m2050m

2100m

well C2115m

well A2017m well B

2060m line of section

A

A

AA

2000m

2050m

2100m

2150m

WellC

WellA

WellB

WUT 2115m

ODT 2085m

OUT 2060m

GDT 2040m all depths in m below sea level

Cross-Section A-AWOMBAT FIELD

Uncertainty with Fluid ContactsWell

CWell

AWell

BWell

CWell

AWell

B

WellC

WellA

WellB

WellC

WellA

WellB

CASE 1: GOC=2040m & OWC=2115m CASE 2: GOC=2040m & OWC=2085m


Uncertainty with Fluid Contacts

N

CASE 1: GOC=2040m & OWC=2115m

N

N

N

GIIP=1.3 million m3 : STOIIP=42 million bbl GIIP=1.3 million m3 : STOIIP=21 million bbl

GIIP=2.4 million m3 : STOIIP=14 million bblGIIP=2.4 million m3 : STOIIP=35 million bbl

CASE 2: GOC=2040m & OWC=2085m



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EP00

Net/Gross Uncertainty

Measured

Maximum ?Minimum ?


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EP00

Combined Uncertainties

60

Base Case

70

Minimum

50

Maximum

20

2515


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EP00

Combining Uncertainties

p

STOIIPp>x

STOIIP

pp

pp

p

GRVN/G

So

1/Bo

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EP00

Expectation Curve

1.0

0.5

0

STOIIP (MMm3)0 50 100 150

Low STOIIP

High STOIIP

MediumSTOIIP

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EP00

Reporting VolumesShell

Low or Proved P85 not Minimum or WorstMedium P50 = most likely or base case High P15 not Maximum or BestExpectation = (Low + Medium + High)/3

Be careful: no consistent use in industrysome call High P85 & Low P15some take P10 & P90, or even P0 & P100some use min & max, or downside & upsideSome use proved, probable, possibleAlso no precise definition on what is taken as proven


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EP00Ultimate Recovery Estimates vs. Time

Time (not to scale)

ProspectEvaluation Explore Resource Management

Appraise Devel. Planning

Proj. Exec.

Devel. Drlg.

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1st hole dryDiscovery

A A A

D D D

CumulativeProduction

P85

P15Abandon


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EP00

a sample of fields, P10s & P90s vs P50

0

200

400

600

800

1000

1200

1400

0 200 400 600 800 1000 1200 1400P50, MMBOE

P

9

0

o

r

P

1

0

,

M

M

B

O

E

P10P90


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EP00

Soon dots will be shown in the oval; how many ???

What is your P50, P90 & P10 estimate ??


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EP00How many dots are there in total oval do you think ? You can only see through a small peephole

What is your P50, P90 & P10 estimate ??


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EP00

Actual ?? 160 dots

+/- 30% : 110 - 210


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EP00

What can we do about the uncertainties

Reduction of static uncertainty High quality seismic, PSDM Appraisal drilling (& logging, coring) Use of analogues

Reduction of dynamic uncertainty Core analysis, Production testing Extended production performance (pilot), 4D seismic Use of analogues

Managing uncertainty Quantifying possible ranges through modelling Identify possible up/downsides & fall-back options Phased development, keep options open

$$$

$$$

$$$

VOI ?

VOI ?


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EP00

Appraisal

The objective of Appraisal Activities is to:

Reduce Uncertainty

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EP00

Appraisal

Information obtained through appraisal is aimed at answering:

How much oil and gas is there? Where is it? At what rate and how much in total will it produce?

p315


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EP00

Appraisal Activities

All forms of data gatheringExamples: Drilling wells Logging and testing Reprocessing seismic Obtaining additional seismic or 3D seismic surveys etc.

p315


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EP00

No info

With info

Devmnt(mid case)

Hi Case

Mid Case

Low Case

50

80

-20

50%

25%

25%

EMV= 0.25 x 80 + 0.5 x 50 + 0.25 x -20= 40

Hi Case

Mid Case

Low Case

50

100

50%

25%

25% Hi Dev

Mid Dev

No Dev 0EMV= 0.25 x 100 + 0.5 x 50 + 0.25 x 0= 50

Info value= 50-40=10 , cost of info needs to be less !


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EP00

1.0

0.5

0

STOIIP (MMm3)0 50 100 150

Uncertainty Reduction with Appraisal

post appraisalnegative

post appraisalpositive

before appraisal

economic minimum

P90

P10

P50

Range before appraisal

Range after appraisal or


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EP00

Resource Characteristics Tree

StructuralExtent

Heterogeneity

Continuity

Aquifer

Probability

DevelopmentScenarios

Too small10%

Large enough90%

Unfavourable50%

Favourable50%

Good60%

Poor60%

Good40%

Poor40%

Weak100%

Strong0%

Weak50%

Strong50%

Weak30%

Strong70%

Weak100%

Strong0%

NPV 1 0 NPV 2 UR 3 NPV 5 NPV 6NPV 4 027% 0% 9% 9% 8% 19%18% 0%10%

Depl.10

wells

N/A WaterInj.

EOR? WaterInj.

Depl.20

wells

Depl.20

wells

N/AN/A

0


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EP00

Schooner Field, Shell Expro UK SNSReservoir uncertainty scenarios


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EP00

Sub-Surface Uncertainty TreeUncertainty

Sand/Shale

PorosityPermeability

Compartments

Fault transmissibility

Shale Kv

Models

Low High

None

Yes

Low Geocap

ML

None

P50 Geocap

Dynamic Uncertainty

ML

Large

High Geocap

ML

NoneNone NoneMulti

No

ML

No

ML

No

ML

No

ML

No

ML

No

ML

No

ML

No

Low

No

High

TerminologyWhy Volumetrics?Groups Resource Portfolio Build-up 1.1.2000ObjectivesSTOIIP and GIIP EquationUncertainties in Volumetric EstimatesDip UncertaintyTop reservoir uncertaintyConger Garden Banks, GOMFault Position UncertaintyNorth Cormorant Block IV : Development StrategiesFault Dip UncertaintyFluid Contact UncertaintyUncertainty in top reservoir map3 development scenarios after appraisalDraugen Field, NorwayUncertainty with Fluid ContactsUncertainty with Fluid ContactsUncertainty with Fluid ContactsNet/Gross UncertaintyCombined UncertaintiesCombining UncertaintiesExpectation CurveReporting VolumesUltimate Recovery Estimates vs. TimeWhat can we do about the uncertaintiesAppraisalAppraisalAppraisal ActivitiesUncertainty Reduction with AppraisalResource Characteristics TreeSchooner Field, Shell Expro UK SNSReservoir uncertainty scenariosSub-Surface Uncertainty Tree

uncertainty analysis

Documents

volume of oil gas

dipmeter dip error

ep00terminology stoiip

bln boeexternally

bln boediscoveredsfrc

bln boeyr

development strategies0

d seismic1983