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Wolfcamp Formation in Midland Basin: Petrophysical Properties, Exploration, and Production

Explore the petrophysical properties and potential of the Wolfcamp Formation in the Midland Basin, including its history of oil exploration and production. Learn about modern completion technologies and practices, as well as their environmental impact. Analyze production data and trends.

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Wolfcamp Formation in Midland Basin: Petrophysical Properties, Exploration, and Production

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  1. Outline • Introduction • Background • Greater Permian Basin Geological Framework • Wolfcamp Formation, Greater Permian Basin • Petrophysical Properties of Wolfcamp Formation of Midland Basin • Oil Exploration and Production History • Completion Technology and Practice • Environmental Impact • Production Analysis • Conclusion

  2. Introduction

  3. Introduction

  4. Background

  5. Background Horizontal Drilling + Modern Hydraulic Fracturing Barnett Shale Gas Play success Shale Revolution

  6. Background (EIA 2015b)

  7. Background (EIA 2016)

  8. Background

  9. Background (Shenck et al. 2008)

  10. Geological Framework

  11. GPB Geological Framework (Modified from Dolton et al. 1979)

  12. GPB Geological Framework (Dolton et al. 1979) • Tobosa Basin (Cambrian – Early Carboniferous) • Tectonic activities – Ouachita orogeny (Late Carboniferous – Early Permian) • Deep marine water deposition and shallow back-reef lagoonal deposition (Permian)

  13. Wolfcamp Formation

  14. Wolfcamp Formation (EIA 2018b) (Baumgardner et al. 2014)

  15. Wolfcamp Formation – Hydrocarbon resource assessment • 1979 (Dolton et al.) • first resource assessment for GPB • based on depth interval • 1995 (Ball) • thin to absent in Midland Basin • carbonate facies – reservoir rocks • shales – source rocks • 2007 (Shenck et al.) • first unconventionals included in GPB resource assessment • Midland Basin: Woodford-Barnett (gas) and Spraberry (oil) • Wolfcamp in Delaware Basin not quantitatively assessed • 2016 (Gaswirth et al.) • unconventional play assessment Wolfcamp, Midland Basin • 2018 (Gaswirth et al.) • unconventional play assessment Wolfcamp, Delaware Basin

  16. Wolfcamp Formation – Continuous Oil AU’s (P50)

  17. Petrophysical Properties

  18. Petrophysical Properties – Midland Basin • Midland Basin – overview: • intracratonic deep water basin surrounded by shallow water carbonate platforms • boundaries: north – Northern Shelf, east – Eastern Shelf, south – Ozona Arch and Val Verde Basin, west and southwest – Central Basin Platform • Horseshoe Atoll – conventional oil play • Midland Basin – deposition: • basinal facies (central): horizontally bedded successions • carbonate platform facies (edges): stratigraphic discontinuity, carbonate rocks, clinoform profile

  19. Petrophysical Properties - Leonardian and Wolfcampian • Rock group distribution: (Hamlin and Baumgardner 2012)

  20. Petrophysical Properties - Leonardian and Wolfcampian • Rock group distribution (cont.): (Hamlin and Baumgardner 2012)

  21. Petrophysical Properties - Leonardian and Wolfcampian • Basinal lithofacies: • sandstone, conglomeratic sandstone, laminated siltstone, mudrock, calcareous mudrock, conglomeratic carbonate, and carbonate packstone/grainstone • mudrock and calcareous mudrock: dominant in Wolfcamp Formation, rich in organic content (Baumgardner et al. 2014)

  22. Petrophysical Properties – Wolfcamp Formation • TOC is highest in siliceous mudrocks and lowest in carbonate facies • Kerogen • Type II (Hamlin and Baumgardner 2012) • Type II/III and Type III (Baumgardner and Hamlin 2014) • Brittleness increases with increasing calcite content and decreases with silicon content • Present day in-situ stress trending east-west • Permeability ranging from 10nD to 3mD • API gravity 40-43 degrees for Wolfcamp Shale and 40-45 degrees for Cline Shale (Menchaca 2012)

  23. Oil Exploration and Production

  24. Oil Exploration and Production History • 1923: Santa Rita No. 1 – first producing oil well (67 years) • 1929: first recorded true horizontal well • 1973: peak of conventional oil play • 2009: modern hydraulic fracturing implemented at scale • 2011: modern hydraulic fracturing + horizontal drilling (Hughes 2018) (GPB production, Hughes 2018)

  25. Oil Exploration and Production History • May 2017: • Spraberry Play 38% of total production • Wolfcamp Play 28% of total production • Bone Spring Play 10% of total production (Wolfcamp Play Production, Hughes 2018)

  26. Oil Exploration and Production History – Wolfcamp Play (Blomquist 2016)

  27. Completion Technology and Practice

  28. Completion Technology and Practice • Three-string casing design • production casing: 5.5” cemented in 8,75” wellbore • Low-weight high viscosity mud – salt section • Lateral: • 5,000ft – 10,000ft (mean around 7,500ft) • >60% hybrid • >60% more than 10 traps • Plug and perf completion • Zipper fracturing method – pad drilling operation

  29. Completion Technology and Practice - Issues • H2S water flow – San Andres Formation • disposal water • H2S water at low-weight mud, heavy lost circulation at higher weight mud • four-string casing design – high operational cost • Innovation: modified three-string casing design with LVSM • Stress shadowing and fracture bias • Innovation: using microseismic imaging to assess fracture trend (Chen et al. 2018) (Patel et al. 2016)

  30. Completion Technology and Practice – Best Practices • Shorter fracture stage spacing • Straight-line measurement between laterals: 550-850ft • Use of hybrid fracture fluid (slickwater and gel) • Increase in proppant amount, fluid amount, and pump rate – complex fracturing *Relatively young play, optimal values need further studies*

  31. Environmental Impact

  32. Environmental Impact • Fresh water demand for hydraulic fracturing • around 1 million gallons per well (2014) • around 2% recycled, the rest reinjected – H2S water flow issues • competition for water allocation down the line • innovation: water processing plants to process formation brackish water and operational wastewater • Sand mining – Dune Sagebrush Lizard habitat • local sand up to 50% cheaper than Midwest sand • mining disturbed more than 1,000 acres of habitat in 2017 • petition submitted to add DSL to endangered species list • mitigation: State of Texas rewriting the conservation agreement first implemented in 2012 to better protect the habitat • Increase in traffic and stress on local infrastructure • 13% increase in roadside deaths from 2012 to 2013 • 63% increase in crashes from 2016 to 2017 • GPB accounted for 10% of highway fatalities in 2018 • mitigation: in 2018, US energy companies pledged $100 million for local infrastructure

  33. Environmental Impact • Natural gas flaring • Texas laws ban flaring except for specific short-term purposes • Texas Railroad Commission may issue long-term permit while waiting on gas transport infrastructure • 4.4% of produced gas was flared in 2017 • solution: investment in midstream infrastructure to increase natural gas processing and transportation capacities

  34. Production Analysis

  35. Production Analysis • Most common method to estimate reserve: decline curve • Horizontal play only dates as far back as 2011 • Vertical play decline rate 5-10% applied • Wood Mackenzie (2018) found decline rate is likely 12-14% • Overestimation of well values • DCA equation • Arps equation, not suitable for shale – low porosity, long transition flow • Modifications: Power Law Exponential, Duong, Stretched Exponential, Continuous EUR, Logistic Growth Model • DCA on production data using DrillingInfo • Actively producing horizontal wells targeting Wolfcamp in Midland Basin (Jan 2011-Oct 2018): 1,647 wells • Wells with at least 5 years continuous production (Jan 2011-Nov 2013): 556 wells • Peak production on average at the second month • Analysis done using default setting on six model types

  36. Production Analysis • At $50/bbl oil price, the difference between the lowest and highest estimates is nearly US$1MM • Empirical production analysis is low-cost, but subject to subjective interpretation • Computer-aided theoretical production analysis is not yet attractive to operators at the moment but may yield more accurate estimates

  37. Conclusion

  38. Conclusion • Central basin area ideal for tight oil play • Significant increase in production and resource assessment since the application of horizontal drilling and modern hydraulic fracturing • Continuous innovation and improvements on drilling and completions • Increase in oil and gas activity impacted the surrounding environment, steps are taken to mitigate • Production analysis for forecasting and reserve estimation purposes using DCA is prone to overestimation due to not enough historical production data from horizontal wells

  39. Acknowledgment

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