DL PETROLEUM ENGINEERING AND CONSULTING LIMITED

1. DL PETROLEUM ENGINEERING AND CONSULTING LIMITED Presentation Prepared By: Dale Lee, P.Eng. May 30, 2013 Google

2. Agenda • DL Petroleum Engineering and Consulting Ltd. • Waterflood Concepts • Our Methodology • Devon Waterfloods (Diana Goldstein) • Q&A

3. DL PETROLEUM ENGINEERING AND CONSULTING Limited • Engineering focus • Analyze reservoirs’ production performance • Predict the locations of underperforming wells • Injectors and Producers • Predict underperforming regions of reservoirs • Infill Drilling • injector conversions • Primary Analytical Tool: Oil Field Manager (OFM)

4. DL PETROLEUM ENGINEERING AND CONSULTING Limited • Engineering focus • Statistical analyses of hydrocarbon production • Spatial statistics (i.e. kriging & Regression Analysis) • Petro-physical data • Pressure & Production history • Purpose • Optimize hydro-carbon recovery • Make money

5. DL PETROLEUM ENGINEERING AND CONSULTING Limited • Previous Studies: • Arsenal Energy: Provost Area – Analyzing pools • Bangladesh (BGFCL): Titas – non associated gas field • Devon Energy: Ferrier – waterflood • CNRL: Nipisi – waterflood Grand Forks – waterflood • Petro-Canada: Golden Lake – heavy oil waterflood Bellshill Lake – bottom water drive Wapiti – primary oil production Williston Green - waterflood

6. WATERFLOOD CONCEPTS • Objectives of Waterflooding • Maintain pressure support above bubble point • Keep gas in solution • Minimize oil viscosity (gas dissolved in oil) • Physical displacement of the oil by the water • Balance the voidage replacement ratios (VRR) • VRR = (Injection/Production) at res. conditions • Optimize oil recovery

7. WATERFLOOD CONCEPTS • Pressure Temperature phase envelope • C to C1 considered waterflood zone • Petroleum Society Canadian Institute of Mining, Metallurgy & Petroleum, Determination of Oil and Gas Reserves, Petroleum Society Monograph No. a, Pg. 147

8. WATERFLOOD CONCEPTS • Criteria for Waterflooding • Geology (k, θ, Sw, heterogeneity index) • Single layer model (Buckley Leverett) • Multi layer model (Dykstra and Parsons) • Gas saturation • (Craig, The Reservoir Engineering Aspects Of Waterflooding) • Mobility ratios • /( • /(, Ideally

9. WATERFLOOD CONCEPTS • Four stages of Waterflooding • Start of injection to interference • Interference to fill-up • Fill up to breakthrough • Breakthrough to economic flood-out limit • Injection rates (piston displacement) • until fill-up • after fill-up

10. WATERFLOOD CONCEPTS • Recovery Factor (RF) • RF = Displacement Efficiency (DE) x Volumetric Sweep Efficiency (VSE)

11. WATERFLOOD CONCEPTS - Variable - Constant Google: https://www.google.ca/search?q=waterflood&hl=en&rlz=1C2SFXN_enCA499CA522&tbm=isch&tbo=u&source=univ&sa=X&ei=rG2dUa3KHIr9iQLf7oH4Cg&sqi=2&ved=0CEEQsAQ&biw=1680&bih=863, May 22, 2013 – Date Accessed

12. WATERFLOOD CONCEPTS • Determine ROIP (Remaining oil in place) • from start of waterflood • Determine OOIP (Original oil in place) • Determine recovery factor at start of waterflood

13. WATERFLOOD CONCEPTS • Example – Ferrier Unit #2 (Devon)

14. WATERFLOOD CONCEPTSferrier performance

15. WATERFLOOD CONCEPTSvoidage replacement ratio

16. WATERFLOOD CONCEPTSpressure data analysis

17. WATERFLOOD CONCEPTSfluid pvt data

18. WATERFLOOD CONCEPTSfractional flow (water) • Fractional Flow equations • Used to generate fractional flow plot as a function of water saturation, Sw, (Buckley Leverett)

19. WATERFLOOD CONCEPTSFerrier example

20. WATERFLOOD CONCEPTSfractional flow curve (water)

21. WATERFLOOD CONCEPTSproducer water saturation

22. OUR METHODOLOGY • Our methodology delivers: • Production Forecasts - Fractional Flow Analyses • Production Trends - OFM Scatter Plots • Production Trends - Aerial Maps • Individual Well Production Analysis • Regional or Pattern Production Analysis • Inadequate Injection Support Identification • Damaged Injector Identification

23. Our methodologyfractional flow (oil) • Fractional Flow equations • Used to generate fractional flow plot as a function of oil saturation, So

24. Our methodologyfractional flow (oil)

25. Our methodologyfractional flow (@so)

26. Our methodologyfractional flow (water)

27. Our methodologyfractional flow (oil)

28. Our methodologyfractional flow (gas)

29. Our methodologyforecast - fractional flow

30. Our methodologyproducer oil saturation

31. OUR METHODOLOGYproducer quadrant analysis

32. OUR METHODOLOGYconformance plots

33. OUR METHODOLOGYconformance plots • Conformance plot of recovery factor as a function of hydrocarbon pore volume injected for each pattern. The thick black line represents the average pattern

34. OUR METHODOLOGYinjector hall plots

35. OUR METHODOLOGYincremental oil calculations • The red curve is used as a base line for calculating incremental reserves (100,000 bbl)

36. OUR METHODOLOGYstatistical analysis • Year 2010 • First regression • Fit 43 of 139 wells • Second regression • Fit 23 of 139 wells • Third regression • Fit 11 of 139 wells • Total fit 77 wells • ± 20%

37. OUR METHODOLOGYstatistical analysis • Statistical Study • 139 wells • 77 modeled ± 20% • 16 wells under performed • 46 wells over performed (e.g. pressure support)

38. OUR METHODOLOGYStatistical Limitations • Statistical Limitations: • Regression equations are only valid for the dataset analyzed • Attention to end points • (e.g. modeling relative permeability curves) • Statistical models iterative • Results can change with dataset and location • Fractional flow analysis can not be generalized • One reservoir is not necessary representative of other reservoirs • Each dataset requires individual analysis

39. Our methodologyfractional flow (oil) • First presented at the 46th Annual Technical Meeting May, 1995 in Banff • Published in the Journal of Canadian Petroleum Technology, August 1996

40. Next: devonwaterfloods(Diana Goldstein)