Overview

1. Vortex Surface and Downhole Flow Modifying ToolsVortexFlowllc.comThomas Smith PE, VP Engr.Cal Whibbs, Sales ManagerPremier Production Solutions403-333-2605

2. Overview • Background and Theory • Surface Tool Case Study • Surface Tool Application Calculator • Development of Downhole Tool • Downhole Tool Case Studies • Conclusion

3. Background • People have been studying rotational flow since the 1800’s • Simply put, • They want to know how nature gets from this • To this • The Coriolis effect doesn’t have the horsepower to transfer enough energy fast enough to explain it

4. Background • Hurricanes last for weeks • Tornadoes last for hours • If a man-made vortex can be controlled to last for 10-15 minutes it could be valuable • Typical velocities in gas flow are around 20-40 ft/sec • 10 minutes at 20 ft/sec = 2.2 miles • 15 minutes at 40 ft/sec = 6.8 miles

5. Changing The Flow Mechanism • Mingaleeva in her paper “On the Mechanism of a Helical Motion of Fluids in Regions of Sharp Path Bending” determined that, • “ The path of least resistance for liquid and gases is determined to be of a helicaltrajectory, and that the slope of the helix varies within 45-65 from the horizontal. The helical path was more favorable from an energy utilization viewpoint, as the power spent to overcome the hydraulic drag for raising an air column, as compared to the motion and rising of equivalent air mass at the same velocities by a straight column is significantly lower.”

6. Simplified Navier-Stokes Equation • Rigid body rotation and circulation without rotation are included in these terms • Millions of hours and hundreds of thousands of pages of reports have been committed to understanding these terms (with minimal success)

7. Development of Vortex Transport • Using flowing gas to shift granular materials has been done for many years • Blowing air over piles of granules (wheat, coal) • Using eductors to accelerate granules • These techniques were effective for about 1,000 ft, but tended to clog • In 12/97, Ecotech of Littleton, CO filed for a patent on a device to: • Create a rotating boundary region to transport solids down a “laminar” inner flow region • Patent application claimed to work at less than half the pressure required in previous tools (2 psig instead of 15 psig) • Patent application claimed that the flow pattern was very long lived (miles instead of 100’s of feet) • Patent granted in 12/00

8. Development of Vortex Transport • All data in patent application was empirical, no arithmetic at all • “It works because it works, and here’s examples” • Ecotech’s Ecoveyor is fast becoming a standard in coal plants • Works over odd piping geometry • Works with fewer moving parts than a conveyor or auger • But does it work in gas fields?

9. Manzanares Case Study • 30.3 miles of pipe (153 diameter-inch miles) • 19 wells (58 BCF Cum, current rate 8 MMCF/d) • Off system delivery pressure 95 psig • Pressure at far end of system 160 psig • One piggable line (4.4 miles of 8-inch and 10-inch)

10. Manzanares Phase 1 • Two six-inch tools installed on the major 6” laterals 2/20/03 • Gizmo 1:

11. Manzanares Phase 1 • Gizmo 2

12. Manzanares Phase 1 • Five months later: • Gizmo 1 is clearly worse, Gizmo 2 is clearly better • Hypotheses: Gizmo 2 is putting water into the trunk and making the wells behind Gizmo 1 see higher pressure

13. Manzanares Phase II • Pigging the 8/10 trunk twice a week, and fluctuations show it’s not often enough • Pressures at wells near trunk higher than before Gizmo 1 & 2 installed • Decided to replace 8/10 launcher with 10-inch tool and install a booster 10-inch tool half way through the system • Tools installed 7/13/03

14. Manzanares Results

15. Manazanares Results

16. Manzanares Results • Water recovery at compressor station went from 30 bbl/week to over 100 bbl/week • Replaced 3 stage compressor with 2 stage compressor. • Gizmo 2 flowed 16 MMCF more than budget ($64k @ $4/MCF), installation cost of Gizmo 1 and 2 was $14k • Whole system flowed 110 MMCF more than budget ($376k excluding Gizmo 2 benefits), installation cost $25k • Some of the observations are pretty subtle, but the cum production results seem to be compelling

17. Surface Calculator • Looked at detailed data on 200 installations • Many successes • Many failures • Evaluated • Pressure • Velocity • Gas composition • Reynolds Numbers • Eulers Numbers • Weber Numbers • Tried to find a statistically valid correlation between success and some measurable parameter

18. Surface Calculator • Most of the successful sites had Weber Number above 100 • All the failures had Weber Number below 75 • Packaged all the arithmetic into an Access database in October, 2003 • The calculations seem to be a good indicator for success

19. Surface Calculator

20. Barnett Shale Installation for Devon Vortex DX TOOLS CBM Installation for Marathon

21. Methods of dealing with liquid-loading issues • Shut-In / Venting : Effective, but requires downtime, and pumper interaction. Result is less MCFPD as compared to a well flowing 24 hrs/day on its own energy. • Soaping: Capillary strings to place continuous soap can be effective, but soap has problems with condensate. Cost of chemical adds to LOE. Only a temporary fix to a larger problem. • Plunger lift: Removes liquid hold up on an intermittent basis, requires pumper optimization and has depth/pressure limitations. Downtime for pressure build cycle results in downtime and less MCFPD. Problems with scale and paraffin on tubing walls. • Pumping water up tubing, gas flows up annulus. Pumping problems due to gas lock, operating costs, electrical costs increase LOE. • Velocity strings: Costly to install and retrieve, problems with corrosion and can lead to expensive fishing jobs. • Vortex tools: No pumper interaction, No electricity, No maintenance required. Can be installed at completion time and will work until the well depletes to the point where it cannot remove liquids using its own energy. Can be used in conjunction with plunger lift, and gas lift as a slug stabilizer.

22. Lab Testing Conclusions • Tested in Texas A&M’s plastic wellbore and test well • Vortex tools successfully reduced liquid loading • Consistent results at varying pressures • Reduced critical velocity • Testing program allowed for design changes to enhance tool performance • Potential use in: • Delaying liquid-loading in flowing wells • Replacing pumping equipment • Replacing/augmenting plunger systems • Improving flow in horizontal wells • Acting as a slug stabilizer • Reducing paraffin buildup

23. Flow Stability Without DX Tool With DX Tool

24. Flow Stability

25. Free-flowing Well Extended Free-flow Period Delay Need for Artificial Lift Enhance Flowing Production Over Life Cycle 75% of Critical 50% of Critical

26. Field Case Studies

27. DX Unloads Well

28. Impact on Production

29. Effect of Downtime Reduced

30. DX Replaces an ESP Pump – Powder River Basin

31. Steady Flowing Well Installation – Uinta Basin CBM

32. PCP vs. Flowing Well Installation – Uinta Basin CBM

33. Barnett Shale installation at 8000’

34. New Well Installation 11,100’ deep

35. Vortex DX Field Performance • Organizes multi-phase flow at the bottom of the wellbore • Lowers flowing bottom hole pressure • Lifts more water with same gas rate • Lifts water with less than calculated “critical” gas rate.

36. Insert style Vortex tool • Eliminates need to pull tubing to install. • Eliminates killing well, can run live on slickline • Set in PN, SN, or collar/tubing stop. • Retrieved via slickline, similar to bumper spring assembly. • Can be run above bumper spring to enhance plunger lift operation.

37. Downhole Candidate Selection • Best rule of thumb • Run a nodal analysis program • Find the Critical Flow Rate using the correlation that best fits your data • The tool should be able to help the well lift water down to 70% of the Critical Flow Rate • Remember: The Vortex tool can be used to enhance existing plunger lift and soap injection under certain conditions…..

38. Conclusion • The ability of a vortex tool to create long-lived flow patterns has been well documented • We don’t expect to ever see a closed-form equation to describe the tool’s performance • The empirical relationships that have been developed will probably be effective in selecting candidates • Data gathering and the data accuracy is essential in evaluating the application for and the eventual performance of these tools.