Duane A. McVay Texas A&M University
''The Value of Assessing Uncertainty (What You Don't Know Can Hurt You)"
The petroleum industry has underperformed for decades because of project evaluation methods that do not fully account for uncertainty. Chronic biases, particularly overconfidence and optimism, persist because there has been little emphasis in the petroleum literature on the true cost of underestimating uncertainty and on how to quantify uncertainty reliably.
In this presentation I will present the results of recent work assessing the monetary impact of chronic overconfidence and optimism on portfolio performance. For moderate and typical amounts of overconfidence and optimism, expected disappointment (estimated NPV minus actual realized NPV) was 30-35% of estimated NPV for the industry portfolios and optimization cases analyzed. Significantly greater disappointments have actually been experienced in industry.
Decision making will be optimal in the long run only when probabilistic forecasts are well calibrated—P10s are true P10s, P90s are true P90s, and so forth. Changing corporate culture to consistently produce well-calibrated probabilistic forecasts will require education on the importance of lookbacks and calibration, as well as changes in business processes and incentive structures. Reliable assessment of uncertainty will add value to the bottom line, and has the potential to significantly improve company and industry financial performance.
Dr. Duane A. McVay is the Rob L. Adams ’40 Professor in the Department of Petroleum Engineering at Texas A&M University. He is a Distinguished Member of SPE. His primary research focus is on uncertainty quantification, particularly in the context of production forecasting and reserves estimation in oil and gas reservoirs. He joined Texas A&M in 1999, after spending 16 years with S.A. Holditch & Associates, a petroleum engineering consulting firm. He received B.S., M.S. and Ph.D. degrees in Petroleum Engineering from Texas A&M University.
Eve Sprunt President of SPE for 2006 , Consultant
''Managing Dual Careers – Work-Life Integration in a 24/7 World''
The “big crew change” has altered the workforce in both visible and invisible ways. Three SPE Talent Council Surveys and a Society of Exploration Geophysicists (SEG) survey provide valuable insights into how to enhance employee retention and increase diversity in management. While it is obvious that more women are working in the petroleum industry, the transition from a workforce largely composed of “dominant earners” to a workforce with many dual career couples has also occurred. Better understanding of how to manage people who are part of a dual career couple will enhance retention and advancement of women, because the majority of women are part of a dual career couple. Men, who are part of a dual career couple and women in general are under-represented in executive management, which continues to be primarily composed of people who have spent their career as the dominant earner in their family. The survey findings suggest that the lifestyle differences between dominant earners and dual career workers introduce misunderstandings about career dedication and work ethics that can lead to attrition. The members of this new workforce are career-focused, hard-workers, but the new lifestyle means that they are living with different constraints. Modifications to career planning that better balance specific opportunities with flexibility and leverage the 24/7 technology-enabled work-styles can build and retain a more diverse and highly motivated workforce.
Eve Sprunt, a consultant, has 35 years of experience working for major oil companies. She was 2006 President of the Society of Petroleum Engineers (SPE) and was made an Honorary Member of SPE in 2010. In 2013 she was honored by the Society of Women Engineers with the Achievement Award, which is their highest award. Her S.B. and S.M. degrees are from MIT (Earth and Planetary Sciences) and her Ph.D. (Geophysics) from Stanford. Her “passion” is conducting surveys to gather information on management of dual career couples and enhancing retention of mid-career female STEM professionals and sharing her observations.
“Think Outside of the Box - Nano Drug Delivery Technologies for Oil Field Applications”
The take home message of my talk is to “Think Outside of the Box” when it comes to developing new technologies for oil recovery applications in both conventional and unconventional reservoirs. To improve oil and gas recovery, we inject all kinds of expensive chemicals into the subsurface. Due to the often hostile downhole environment, most oilfield chemicals cannot survive the extreme temperature, salinity, and pH. There is a strong incentive to develop improved techniques to protect and control/delay the release of oil and gas field chemicals so that they can be successfully transported to the target locations underground. Based on the drug delivery technologies from the pharmaceutical industry, a chemical delivery system was developed using nanoparticles to entrap and protect oilfield chemicals from the hostile underground environments. Nanoparticle colloids have emerged in pharmaceutical products and in some aspects, the pharmaceutical industry has led the way in nanotechnology. The seemingly unlimited price for small quantities of pharmaceuticals stands in stark contrast to the large volumes of commodity chemicals needed for oil and gas well treatments; however, the same basic formulation concepts apply. Nanoparticles must effectively stabilize, deliver, target, and/or sustain the effects of the oilfield chemicals. In this talk, the basic concepts behind the development of a cost-effective nanoscale chemical delivery system will be discussed. Example applications in both conventional and unconventional reservoirs including delayed gelation for in-depth conformance control using polymer gels, as well as protection and controlled release of enzymes for effective fracture cleanup will be presented.
Dr. Jenn-Tai Liang is a full professor in the Department of Petroleum Engineering at Texas A&M University. He received his PhD degree in Petroleum Engineering from The University of Texas at Austin. Before joining TAMU, Dr. Liang was a professor of Petroleum Engineering and director of Tertiary Oil Recovery Program at The University of Kansas. Prior to that, he served as a program manager in upstream oil and gas research at the US DOE Idaho National Laboratory. His research focus is on the application of nanotechnologies for conformance control, flow assurance, hydraulic fracturing fluid cleanup, in both conventional and unconventional reservoirs.
Curtis G. Blount ConocoPhillips
“Lessons Learned in Technology Development……and Perforating ‘Smart’ Wells”
Developing new technology is often considered risky, misunderstood, and prone to time and budget over-runs. This presentation will use a recent ‘smart’ well technology development program as an example of challenges in new technology development. The presentation will also discuss challenges of introducing new technology, and pitfalls that are often encountered that perpetuate the 'not in my well' attitude that is often heard when introducing new technology.
Increasing numbers of 'smart' and instrumented wells are being completed worldwide. Many of these types of completions will require perforating as part of the initial completion and many more may require perforating at some time during the life of the well. Even completions that do not require perforating, such as common packer/sliding sleeve open hole completions, still rely on perforation technology to provide a back-up contingency.
This presentation identifies challenges and methods developed to mitigate problems associated with and to enable perforating instrumented and smart wells. This presentation will also review the tools and techniques available to perforate these types of completions, while avoiding damage to pipe external control lines, cables, gauges, fiber optic lines, and other critical completion equipment. Discussions will cover a brief history and limitations of currently available tools and techniques. Details of testing and tool developments will be discussed followed by lessons learned from a multi-well field program.
The instrumented ‘smart’ well development program discussed in this presentation includes six wells ranging from a 2,600' measured depth vertical well to 3 horizontal completions with measured depths exceeding 16,000'. The program included running over 20 logs ranging from magnetic based detection tools to ultrasonic tools, and perforating 129 separate intervals. Results of testing available tools and details of development of new equipment, tools and techniques will be discussed. No external cables or other smart well components were damaged during the 129 perforating operations.
Curtis Blount is Sr. Fellow Advisor for ConocoPhillips in the Houston based Global Well Technology group specializing in advancing technology applied in challenging and harsh environments. He has been active in CT and well intervention research and applied technology development for more than 25 years. Blount has coauthored more than 30 technical papers and holds over 20 patents. He is an active participant serving on numerous SPE committees. Curt was an SPE Distinguished Lecturer on CT Drilling technology for 2002-2003, SPE Alaska chapter’s Engineer of the Year for 2003, and was SPE’s Drilling and Completion award recipient for 2007. Blount served on Drilling and Completion’s Advisory Committee and was chairman of the SPE Distinguished Lecturer Committee (2010-2011). Curtis is an SPE Distinguished Lecturer on technology developement for instrumented and smart wells for 2014-2015.
Daniel J. Daulton Bakerhughes
“ Hydraulic Fracturing Myths, Reality, and Environmental Stewardship Through Better Chemistry”
Education is the secret to overcoming preconceived notions, prejudice and general lack of knowledge. Our industry must share its technical accomplishments, concern for environmental stewardship and process of continuous improvement. This demonstrates our commitment to responsible development and supply of energy needs to a global economy.
This presentation will address common concerns related to stimulation, focusing primarily on hydraulic fracturing fluid chemistries used in routine completion and stimulation operations of oil, gas wells.
Important questions and issues will be covered such as:
– Hydraulic Fracturing “out of sight, out-of mind”
– Are hydraulic fracturing chemicals dangerous and unregulated?
– Are hydraulic fracturing chemicals secret?
– Hydraulic Fracturing Chemical Disclosure
– Chemical Evaluation from a global perspective
– Industry Adoption
The industry message is three parts: 1) responsible oil and gas development begins with proper well construction and zonal isolation, 2) our industry should continue chemical development with a focus on reducing environmental, human and physical hazards, 3) education and openness is an important part of our industries way forward and public acceptance.
Daniel J. Daulton currently holds the position of Director of Environmental Conformity for the Pressure Pumping product line at Baker Hughes. His responsibilities include global support of environmental related issues impacted by regulatory governance, compliance, chemical disclosure and product enhancement. Prior to this position, Dan served as the U.S. Technical Marketing Manager for the BJ Services Company. He has served in multiple operations, technical engineering, sales, marketing, and research and development roles since joining The Western Company of North America in 1980. His experience also includes providing technical seminars domestically and internationally in Western Europe, Argentina, Venezuela, Bolivia and Indonesia as well as a three year international assignment in Aberdeen, Scotland supporting technical projects in Western Europe, the North Sea, North and West Africa. In addition to being a 32-year member of Society of Petroleum Engineers, Daniel J. Daulton has authored several SPE papers and served on numerous committees. He also serves as Chair (2011-2012) on the U.S. Department of Energy’s Ultra-Deepwater Advisory Committee. Born and raised in the midwestern United States, Dan graduated from Northwest Missouri State University with a Bachelor of Science degree in Earth Sciences.
Herman Lemmens FEI
«Pore Scale Imaging in Black Shale:“what does the organic matter look like, and does it matter?»
The discovery of nanometer-sized pores in the organic phases in black shale has led laboratories in the oil and gas industry to invest in electron microscopy tools. However, the researchers were confronted with the field of view vs. resolution paradox. Images that show the small pores are typically only a few tens of micrometers wide. The big question is how representative the features are. The latest technology introduced is FIBSEM, where a focused ion beam (FIB) inside a scanning electron microscope (SEM) enables 3D reconstructions with nanometer resolution. A workflow is presented in which the core plug scale mineral maps are combined with hundreds or thousands of SEM images to define the representative elements of the core plug. Extracting numbers from images is an important part of this workflow. Examples are shown in the Eagle Ford, Marcellus, and Niobrara shales.
Herman Lemmens is a technology manager at FEI in the Netherlands. His role is translating the needs for pore scale imaging in the oil and gas industry into product specifications for new electron microscopy tools. Lemmens’ primary areas of interest are imaging of porosity in the organic phases in shale, integrating imaging at different length scales, and relating mineral textures to fracturing efficiency. He holds a PhD degree in physics from the University of Antwerp
One of the fundamental questions that mankind has asked from the beginning of time is: Are we alone in the Universe? To find that answer will require the use of technology and techniques we use within our petroleum engineering profession. There is one place accessible to mankind that has the strongest possibility to answer that question: Mars. We know for certain of one start of life, Earth. Was there a second start? Or was there a single start of life; but, it started on Mars and migrated to Earth? And how will we find out? This presentation will cover the latest information on the basic characteristics of Mars, as we understand it today. It will also cover some of the current thoughts regarding Martian geology and its possible history with the implications for life. The various Mars missions to date have indicated that there are no organic materials present on the surface of the planet; however, as on Earth, there could be a large biomass under the surface. To determine that, drillers are needed to access the subsurface. The tools and techniques developed in the oilfield and other related areas are the basis for this technology. This presentation will cover some of the current plans for Martian subsurface exploration. the techniques for getting there, and how what we learn about drilling there could impact us here on Earth.
Alfred William Eustes III is an Associate Professor in Petroleum Engineering at the Colorado School of Mines where he has taught for seventeen years. He has a B.S. in Mechanical Engineering from Louisiana Tech University (1978), an M.S. in Mechanical Engineering from the University of Colorado, Boulder (1989), and a Ph.D. in Petroleum Engineering from the Colorado School of Mines (1996). His research specializes in drilling and completion engineering and operations. He is a registered Professional Engineer with the state of Colorado and has thirty-five years of drilling, completion, work-over, and production engineering and operations experience. As a field engineer with ARCO Oil and Gas Company for his first nine years in the field, he designed and supervised the drilling of petroleum wells from the Mid-continent to the Appalachians. Since then, he has been involved in drilling operations in the Rocky Mountain region and Alaska, coring at Yucca Mountain, Nevada and resonant sonic drilling at Hanford, Washington. He has also advised NASA regarding extraterrestrial drilling issues and the National Science Foundation with ice coring and drilling in Antarctica and Greenland. He is currently researching methodologies for improving drilling operations and reservoir characterizations using real time drilling rig data. He is a member of the Society of Petroleum Engineers, the International Association of Drilling Contractors, the American Association of Drilling Engineers, and is a past chair of the Petroleum Division of the American Society of Mechanical Engineers.
Formation Damage Matters - Sometimes by Michael Byrne Synergy
This lecture will explain that understanding the impact of formation damage is critical to succesful well design.
It has long been recognized that Formation Damage during drilling, completion, production, well intervention and injection has a serious impact on well performance, field life and value. But the impact of formation damage on different reservoirs and wells has often been the subject of conjecture and speculation rather than science.
This lecture provides some insight in to new understanding, modeling and theories on the impact of formation damage. Specific cases where damage is not important and where it is extremely important are explained. The concept of “using” damage to help with drilling low pressure reservoirs and the real impact of damage in long wells will be discussed.
The difference between skin factors and formation damage will be explained and the traditional reliance on skin to help to explain and predict well performance will be discussed. The lecture will encourage a step back from conventional thinking on skin and formation damage and advocate the use of modern computational power to solve complex physical challenges.
Members should take away some insight in to the impact of Formation Damage as well as an appreciation of the scale of debate and development in this technical area.
A graduate of University College Dublin, Michael has worked in the oil industry for twenty five years and has spent twenty four years evaluating formation damage and sand control challenges. He has written and presented various training courses and acted as a consultant to major oil companies worldwide. Numerous technical publications include key SPE papers on drilling and completion related formation damage mechanisms. Principal author of papers on recommended laboratory practice and on description of formation damage mechanisms. More recently, Michael has pioneered the use of computational fluid dynamics for well inflow modeling and has several patents in application related to this process. He has served SPE as technical editor, short course instructor and Steering Committee member and session chair at several SPE conferences, workshops and forums. He was an SPE Distinguished Lecturer for the 2009-10 lecture season. Michael chaired the 2013 SPE European Formation Damage Conference and is a Petrowiki moderator for formation damage. Michael works for Senergy in Aberdeen as Global Technical Head, Formation Damage.
Hani Al-Khalifa Saudi Aramco_
«The produced Water with Crude Oil Production»
Utilizing Produced Water for pressure support is one common practice in the Oil industry. However, handling the increasing rates is becoming a major concern. Produced Water re-injection systems consume a huge percentage of overall upstream production facilities power requirements. Typically such systems are designed with some reservoir performance uncertainties and production demand. This fact encourages designers and operators to oversize the system to be in the safe side and guarantee that the system is adequate. However, this approach comes on the expense of system efficiency of only 20-30%.
A new approach to effectively analyze produced water Re-injection systems and evaluate alternatives to significantly improve their efficiencies and guarantees adequacy is badly needed more than ever. The approach must evaluate the whole system from the suction of the re-injection pumps to the bottom of the disposal wells of multiple facilities simultaneously. The methodology should address reservoir pressure, headers and laterals, pumps configuration and drive mechanism in details. In addition, this approach should address both short and long term optimization needs. A new set of tools and mindset was successfully implemented and resulted in 100s of giga wats of saved power and the overall system efficiency was improved to 70-80%.
This experience can be adopted by many other operators and we could avoid the need of many large power generation projects.
Al-Khalifa graduated from the King Fahd University of Petroleum and Minerals in 1996 with a BS in mechanical engineering. He joined Saudi Aramco in December 1997. Al- Khalifa joined the South Ghawar Engineering Unit in 1998 as a process engineer. Currently, Al-Khalifa is Senior Process Engineer and a group leader at North Ghawar Producing Department. Al-Khalifa issued several technical papers and presentations on Produced Water Re-injection System optimization.
Al-Khalifa, has been active member of the Society of Petroleum Engineers (SPE) and co-chaired several Applied Technologies Workshops. He contributed to establishing the 1st Young Professionals section at the Middle East. Al-Khalifa served as a member with the Projects, Facilities and Construction Subcommittee of Annual Technical Conference and Exhibition in 2007, 2008 and 2009