Enhanced Oil Recovery Studies in the Tirrawarra Oil Field, Cooper Basin, South Australia

1. Enhanced Oil Recovery Studies in the Tirrawarra Oil Field, Cooper Basin, South Australia Ian Pedler 23 September 2009

2. Enhanced Oil Recovery Studies in the Tirrawarra Oil Field, Cooper Basin, South Australia The Tirrawarra oil field is located in north-eastern South Australia in the Cooper Basin.  The field was discovered in 1970 and is the largest onshore Permian oilfield in Australia.  Primary production commenced in 1983 and from 1984 to 1996 the field was subjected to a miscible flood initially using raw satellite gas and subsequently, ethane injection.  With the commencement of ethane sales from the Cooper Basin the EOR scheme was shut-down and the field was has been produced on blowdown since 1996. In 2008 a study team was established to re-evaluate the field and review the potential for the re-establishment of and EOR scheme using CO2 or another suitable fluid with particular attention to the under-developed areas of the field.  The study was an integrated review of the subsurface, well construction and facilities aspects of an EOR project and included the construction of a modern static reservoir model and fully compositional dynamic simulation model.  This presentation will review some of the results from the 2008 study and the implications for the implementation of a future EOR scheme in the field.

3. Cooper Basin Unit Partners

4. Contents • Tirrawarra Field Review • Discovery • Development • Recent Performance • 2008 EOR Studies • Reservoir Modelling • EOR Screening Results

5. 1. Tirrawarra Field Review

6. Santos acreage Basin outline Oil pipeline Gas pipeline Tirrawarra Location Queensland BowenBasin CooperBasin Brisbane Moomba SouthAustralia GunnedahBasin 50km Pt Bonython NewSouth Wales Sydney Adelaide

7. Cooper Basin Operations Terrain Near Moomba Typical Gas Wellhead Moomba Plant Tirrawarra Satellite

8. Tirrawarra Discovery and Appraisal • 1969 : First gas sales from Cooper Basin • 1970 : Tirrawarra-1 • Gas and oil discovery well • TD 10,200 ft • Volatile oil in Tirrawarra formation • 592 bopd max test rate • Liquids rich gas in multiple stacked sands in overlying Patchawarra formation • 6.9 MMscf/d max test rate • 1970 – 1972 Tirrawarra 2-11 • Patchawarra/Tirrawarra appraisal • Toolache formation gas discovery • 1973 – 1979 • No activity, pending development of Cooper Basin Liquids Project

9. Tirrawarra Field Summary Tirrawarra Field Tirrawarra Reservoir Properties OOIP:  150 MMstb Crest : 9300 feet SS Closure :  550 feet Thickness : 100 - 180 feet Area :  12,000 acres Porosity : 6 – 10% Permeability : 0.05 – 1 md Fluid Properties Initial Pressure : 4260 psia Bubble Point : 3000 psia Temperature : 140 oC Solution GOR : 2700 scf/stb FVF : 2.7 rbbl/stb Viscosity : 0.09 cP Tirrawarra Oil Composition

10. Tirrawarra Field

11. Tirrawarra Field Development • 1981 : Commencement of Cooper Basin Liquids Project • 1983 : First oil production from Tirrawarra (depletion) • 1984 : Pilot EOR miscible flood project commenced based on raw gas injection • Total 10 Bcf inj from ’84-’88 • 1986 : Ethane injection commenced as part of basin ethane storage commitment • 1997 : Ethane injection ceased with the commencement of ethane sales from the basin • Total 90 Bcf inj from ’86-’97 • 2007/8 : Multiwell appraisal programme and EOR Project Team established

12. Tirrawarra Field Production

13. 2. 2008 EOR Studies

14. Ethane Treatment CO2 Removal Liquids Recovery DeH2O Current Operations Tirrawarra Satellite CO2 to Vent Tirrawarra Oil Field Ethane and Sales Gas to Sydney Gas Satellite Sales Gas to Adelaide Cooper Basin Gas Fields Moomba Plant Liquids to Pt Bonython

15. Ethane Treatment CO2 Removal Liquids Recovery DeH2O Proposed MCS1/EOR Project New Inj & Prod Wells New Dense Phase Pipeline Tirrawarra Satellite Upgrade Compression De H2O Tirrawarra Oil Field New CO2 Facilities New Fuel Gas Line Ethane and Sales Gas to Sydney Gas Satellite Sales Gas to Adelaide Cooper Basin Gas Fields Moomba Plant Upgrade Liquids to Pt Bonython

16. 3D Seismic Based Structural Interpretation Fieldwide Basic Data Review Petrophysics Static Model Feedback Production, Pressure Data Appraisal Results New Dep. Model PVT Dynamic Model Matched Dynamic Model to Test EOR and Development Scenarios OOIP Sensitivities Upscale History Match Res. Eng. Studies Fracture / production / log KH / single well modelling etc Subsurface Workflow • Static Reservoir Model • First use of modern 3D reservoir modelling tool in Tirrawarra • Integrate nearly 40 years of core, log and stratigraphic data from >80 wells to create 3D geocelluar model • 120m x 120m x 1 ft (6,000,000 cells) • Dynamic Reservoir Model • Upscale Static Model to size suitable for dynamic numerical modelling • 50,000 – 100,000 active cells • Fully compositional reservoir model with 8 component PVT model • History Matching Process • Make ‘reasonable’ changes to a base model to approximate past performance • Matching >25 years of observed pressures, rates, ratios • Iterative, time consuming & non-unique process • Outcome is a matched model that can be used to test various EOR and development scenarios

17. The Importance of Compositional Modelling EOR Injectants Studied Product Stream Destination PVT Component Tirrawarra Reservoir Fluid Sales Gas CO2 Sat. Gas Vent 1 Sales Gas 3 Ethane 2 4 LPG 5 Oil 6 7 8

18. Tirrawarra History Match - HCPV

19. Tirrawarra History Match - Pressure

20. Tirrawarra : Current Day Conditions Northern, Greenfields Area Lower on structure, Higher pressure, unswept Core, Brownfields Area High on Structure Low pressure, swept 2009 HCPV 2009 Pressure 2009 Status Core Area RF : 33% North Flank RF : 10%

21. Tirrawarra : Current Day Conditions Northern, Greenfields Area Generally lower kh and well productivity Northern, Greenfields Area Lower on structure, Higher pressure, unswept Core, Brownfields Area High on Structure Low pressure, swept Core, Brownfields Area Generally higher kh and well productivity 2009 HCPV Reservoir kh

22. CO2 EOR Alternatives • 600 ktpa CO2 • Greenfields Area • “Oil Focussed” CO2 EOR • 52 New Wells • 37 new prod • 15 new injectors • 600 ktpa • Brownfields Area • “Storage Focussed” CO2 EOR • no new wells, recreate original injection patterns

23. Tirrawarra 600 ktpa CO2 EOR Cases Greenfields Area “Oil Focussed” CO2 EOR Brownfields Area “Storage Focussed” CO2 EOR Total Inj. Net S’age Total Inj. Net S’age C1 C2 LPG Oil Oil

24. The Fuel Gas Challenge ….. 1 Mtpa CO2 to Vent 100 ktpa CO2 to Atmosphere 1 Mtpa CO2 to EOR Capture Compression Process Moomba Plant Sales Gas Gas Turbine • To inject 1 Mtpa of CO2 for EOR, 0.1 Mtpa of new CO2 emissions are generated. For EOR, CO2 is cycled through the reservoir and plant several times and each time this happens new CO2 emissions are generated. • For pure MCS this only happens once

25. The Fuel Gas Challenge ….. 1 Mtpa CO2 to Vent 1 Mtpa CO2 to EOR Capture Compression Process Moomba Plant Electric Driver Geothermal Power Station

26. EOR Fluid Evaluation Satellite Gas Blowdown Sales Gas Blowdown Initial Depletion Phase Basis: Greenfields Area Northern Injection Only 600ktpa CO2(e)

27. Conclusions • Pre FEED Studies successfully completed in early 2009 • Cooper Basin JV has chosen to place a large scale Tirrawarra CO2 EOR project on hold pending clarity on carbon pricing and oil price recovery • New development drilling in Northern Tirrawarra is proposed for 2010 to prove reservoir performance of this area • Australia’s only EOR Project is currently underway in nearby Fly Lake field • Pilot scale project using Tirrawarra satellite gas to increase oil recovery

28. Acknowledgements • TEOR Subsurface Pre-FEED Team • David Grybowski, Bich Thuy Ngo Hoang, Adam Little, Serge Toulekima and Alan Waldron • Cooper Basin Joint Venture Partners