Production Maintenance in Mature fields How Monitoring Impacts Production…

1. Production Maintenance in Mature fields How Monitoring Impacts Production… IAGP Neuquen 2008

2. Introduction • Mature fields require an intensive monitoring in order to: • Understand the field behavior. • Characterize the reservoir • Detect opportunities to increase production and reserves  workovers, stimulations, perforations, loops, fractures, etc • Adjust dynamic models to provide accurate production forecasts and justify new projects • BUT monitoring must be carefully chosen and followed from the very beginning of field life • “To much info kills info”  each field requires a dedicated monitoring plan • Operating costs must be kept under control as production is declining  get the right data at the right time • Examples of specific monitoring actions that had impact on production and reserves • Aguada Pichana: new fracture methodology adapted to heterogeneously depleted reservoir • San Roque: well performance actions to fill a production gap - IAGP Neuquen 2008

3. Neuquen Basin Sedimentary column Neuquen Basin – Aguada Pichana Block • The Aguada Pichana field is located in the Neuquén Basin, south-western Argentina. • The field produces gas from the sandstones of the Mulichinco formation, its main reservoir. • Aguada Pichana is the second largest gas field in Argentina • It is developed in the eastern flank of the NW-SE trending positive structure called Chihuido anticline. • The Mulichinco Fm depths ranges between : 1600 / 1800 mMD SCHEMATICSECTION - IAGP Neuquen 2008

4. Aguada Pichana Production History k=1-5mD k=5-10mD K<1mD • PROBLEMATIC • Low/Med perm. / heterogeneous sands • Strong natural decline • Intense drilling campaign (3 to 4 wells per month) • New wells towards the West (low K) • Necessity of LP compression • Complex coordination with multiple constraints • Hydraulic fractures systematically required k=20-50mD - IAGP Neuquen 2008

5. How to maintain the production plateau in AP ? • Continuous monitoring actions such as: • Well tests, Isochronal tests, MDT, PLT, fluid sampling, seismic surveys • allowed to define: • Drilling Campaign extensions  thanks to adequate coring program and dedicated 3D seismic survey • infill & delineation wells • Step out wells • Production Optimizition & stimulations actions • MP & LP compression  inline with expectations thanks to an adapted monitoring and a good model history match • New fracture design (wells without fracture don’t produce) • Future development projects in AP Block being studied • LLP compression • Well spacing reduction • Low permeability reservoirs  how to produce them economically ? - IAGP Neuquen 2008

6. AP: Fracture design optimization Typical MDT + permeability log in AP Continuous monitoring actions in order to identify possible “bottlenecks of potential”: Monitoring & new fracture design: • Gas potential evolution: production tests • Reservoir pressure evolution: statics gradients & MDT acquisition in every new well • Isochronal test after frac  transmissibility / Skin / Xf • Thanks to monitoring, it was possible to see that some wells didn’t show the expected fracture behavior and the corresponding productivity • By Integrating the MDT data (differential depletion) + rock mechanics in our designs, it was possible to optimize the treatment with dedicated fractures to avoid convection and disconnection between frac and wellbore Main results • Increased average gas rate (~20%) • Accelerate reserves • Average skin = -5 against -3 previously New fracture design Old fracture design • Lower K zone • Pressurized zone Perf • High K zone • Depleted zone Disconnection of frac due to convection - IAGP Neuquen 2008

7. Neuquen Basin San Roque Block ASR Block Gas export ASR RCh • PROBLEMATIC • Intrusive sills: volcanic sills naturally fractured • Shallow sills (LLY, F3C): Rich gas and oil • Deep sills (Rincon Chico) : Dry gas HP/HT • Shallow Clastics (Centenario / Mulichinco) LLY - IAGP Neuquen 2008

8. How to maintain the production plateau in ASR ? • Continuous monitoring actions: • Well tests, Flow after flow tests, PLT, etc • Production optimization & stimulations actions • Nodal Analysis: tubing resizing, loops, etch. • MP & LP compression • Optimizing selective completions in ASR clastics wells • Acid stimulation with balls sealers: necessary in all filons target • Re-perforations / re-stimulations with new acids treatments. • Future studies in ASR Block • New technologies (batch fracs, new acids, local compression,…) • Infill targets based on revised and history matched models • New stimulation campaign based on recent success on filones - IAGP Neuquen 2008

9. Centenario C Centenario A Mulichinco Aguada San Roque Clastics: Production Optimisation Example • Optimization: based on good initial data per layer + pressure monitoring in neighboring wells, a multi layer nodal analysis was performed  low risk of crossflow and potential production gain was identified • Best configuration was found (M + Cent A + Cent C) • Significant production increase was achieved • Gain: + 110 Km3/d from M + Cent A + Cent C - IAGP Neuquen 2008

10. Loop MP WO Perf + acid San Roque : another production optimisation example Due the complexity of the ASR & LLY fields (filones), acid jobs with ball sealers are necessary in order to stimulate all the opened fractures. In the same way, reperforations jobs enhace access to new fractures. A typical workflow in ASR block is: • Tubing change + acid job + ball sealers + Loop • Add perforations + acid job + ball sealers • Analysis nodal • Workover (2 7/8”  4 ½”) • New analysis nodal • Loop • Tubing Change • Flow after flow  PI diagnosis • Analysis nodal  Prod performance • Workover (2 7/8”  4 ½”) • Re-perforation + acid job  to be done shortly WO MP LP Bad tests • Incremental production : 70 KSm3/d • Incremental production : 600 Km3/d - IAGP Neuquen 2008

11. San Roque Actions: Impact on production profile Δ~ 1.5 MMm3/d - IAGP Neuquen 2008

12. Conclusions The actions carried out as consequence of the monitoring have allowed us to: •  Aguada Pichana: • Extend production plateau and compensate the strong decline of the field (400 / 450 Km3/d every month) • Identify new zones of interest (conventional or not) • Debottleneck surface facilities and well architecture when required • Design a new fracture methodology to increase production and push upwards the recovery factor • Prepare the future (new drilling campaigns and/or developments, LLP, spacing reductions)  San Roque • Extend the production plateau until LP compression start up • Debottleneck surface facilities and well architecture when required • New stimulations design  potential stimulation campaign could be triggered • A monitoring plan is a fundamental part of a Field Development Plan. It allows to: • Understand the field, anticipate actions and react in time in any situation • Update our models (static and dynamic) for more robust reserves estimates • Identify potential upsides and reduce risks for future projects - IAGP Neuquen 2008

13. Final Word: Integration of disciplines is key Reservoir Well Completion Well Performance Team Production / Surface facilities - IAGP Neuquen 2008