Adjustable Speed Drives (ASD): Failure Reduction and Production Optimization

1. Adjustable Speed Drives (ASD): Failure Reduction and Production Optimization Frank Ochoa 07/25/2007

2. Introduction • The Adjustable Speed Drive utilizes sensorless vector software to determine load and position. In a dynamic well environment, the ASD can seek the optimum Strokes Per Minute (SPM) to maintain a fluid level just above pump off, without shutting the well down. This results in a reduction of equipment loading, reduces failures, and maximizes fluid inflow to the wellbore.

3. Agenda • Capabilities of the ASD • Case Studies • Applications of the ASD • Selection Process • Results and Projections

4. Continuously Adjusts Motor Speed to Match Productivity of the Well Intra-Stroke Speed Variation Slower Down-stroke Faster Upstroke Internal Pump Off Control or paired with Lufkin SAMS Controller Converts Single-phase Power to Three-phase Soft Start Drive Software Motor Torque is sensed and used to control the drive Capabilities of the ASD

5. ASD Provider • Lufkin ASD • Crane, TX • Original Drive Tested • Cutler Hammer SVX-9000 • Current Drive • Toshiba • Software • SALT Sensorless Artificial Lift Technology

6. Vendor Stated ASD Lift Applications • Conventional Pumping Units • Most common artificial lift unit. • Rotaflex Units • A Rotaflex is an “ultra” long stroke pumping unit that is used primarily for deep high-volume wells. Fills a niche between conventional and ESP units.

7. Objectives Validate ASD Applications Develop Selection Criteria Develop Standard Setup Wells #43 Sec. 198 #402 Sec.198 Case Studies

8. Rotaflex Unit 20 BOPD, 700 BWPD 2 ¾” Big Bore Pump SPM: Constant 4.3 288” Stroke Length Hard Pump Off Job Reason Date Rod String Failure 9/15/2006 Rod String Failure 9/29/2003 Tubing Failure 8/29/2003 Rod String Failure 10/5/2002 Pump Failure 4/19/2000 #408 Section 198

9. Conventional 640 Pump Unit 120 BOPD, 200 BWPD 2 ¾” LB Pump SPM: Constant 8.6 168” Stroke Length High Cycle Rate 3 Failures in 12 Months #43 Section 198

10. ASD Applications • Failure Rate Reduction • Eliminate Fluid Pound • Reduce Rod Buckling • Reduce or Eliminate Cycling • Conventional, ESP, and Rota-flex • Smooth Upstroke/Downstroke Transition • Reduce Motor Temperature • New Well Stabilization • Rota-flex Optimization

11. Fluid pound is caused by Incomplete Pump Fillage. It can lead to: Shock Wave Gearbox Wear Loss of Coupling Displacement Equipment Failure Rod Fatigue Rod Wear Tubing Wear Pump Component Failure Eliminate Fluid Pound

12. Reduce Rod Buckling Rod Buckling is the primary cause of tubing and rod wear failures. Rod buckling can be caused by: • Fluid Pound • Downstroke Compressive Forces • Sucker Rod Velocity • Crooked Hole • Pump Sticking The ASD can reduce rod buckling by: • Maintaining a fluid level above pump-off so that fluid pound does not occur. • Slowing the downstroke while speeding up the upstroke to minimize compression.

13. Eliminate Cycling • When the ASD detects pump-off, it slows the pump down instead of shutting it off. This allows the well to recover while maintaining fluid flow into the pump. This is advantageous for many reasons: • Less starting/stopping of the Equipment • Solids Control • Continuous fluid flow eliminates sand, iron sulfide, etc. from falling back onto the pump. • Continuous fluid flow reduces scale, paraffin and asphaltine buildup.

14. Upstroke/Down-stroke Transition • Slower transitions reduce loads and stresses on both surface and down-hole equipment • Applicable to Conventional Units • Will be tested on Lufkin Mark Unit

15. New Well Stabilization • Match changing well production • Keeps solids moving during cleanup • Compensate for minor design inefficiencies • Maximize inflow by maintaining minimum fluid level in the wellbore

16. Rota-Flex Optimization • The ASD can optimize these units by: • Upstroke/Down-stroke Speed Variation • Transition Load Reduction This translates into: • Less Failures • Less Wear on Equipment • Longer Runtime • Rota-Flex Unit • Down-hole Equipment

17. ASD Candidate Selection Process • New Wells • Rota-Flex Units above 3.5 SPM • ESP’s that cycle due to fluctuating production • High Failure Rate Wells meeting certain Criteria • We identify wells listed with 2 or more failures in the last 12 months. • WellServ • Lowis • Catalyst • We then sort the wells based on failure mode and operating conditions that the ASD could effect. • Rod and Tubing Wear, Pump Failures • SPM, Runtime, Stroke Length • Meet with Artificial Lift/Corrosion Rep for final review and candidate selection

18. ASD Selection Process • Reviewed Rota-flex SPM • Repeat Failure Candidates • 9% of wells account for 51% of failures • Wells sorted by failure type • Reviewed with Artificial Lift Rep • Submit Recommended Wells

19. Results and Projections Adjustable Speed Drives have a definite benefit in the oilfield. When placed in the correct application, the ASD can: • Reduce Failures • Optimize Production • Reduce Equipment Changes • Reduce Operating Expenses • Reduce Downtime • Fast Payout

20. Potential Benefits • Power Savings • Optimize Paraffin Treatment Schedule • Efficiency Increases • Nema B Motor v. “high-slip” Nema D Motor • Power Factor of .97 • Potential Harmonic Effect Potential Concerns