Completions are a significant cost for E&P operators, contributing to roughly 2/3 of the overall cost of an unconventional well. Meanwhile, we are challenged with with sub 10% recovery factors and various reports indicate that 30-50% of completion stages do not actually contribute to production. This has left a significant room for optimization.
As we have begun to uncover in our Analytics 2.0 study (see flyer for more details), emerging technologies and innovative solutions are starting to make an impact. Technology firms across the globe are spending as much capital as time developing solutions that are addressing the high cost low recovery dichotomy.
Historically, operators have tackled this problem in 3 major ways:
1. Higher intensity fracs: Shale operators began high intensity frac campaigns with more stages and higher proppant volumes yielding greater drainage efficiency. While this has contributed to higher production per well or per stage, the method may reach a period of diminishing marginal returns or environmental resistance.
2. Optimized geometric fracs: Through trial and error and in some cases using advanced analytics engines, some operators take all the public and internal data on reservoir and completions parameters to generate the best recipes. These methods, sometimes combined with scientific models, tend to be inconsistent and error prone due to highly heterogeneous subsurface characteristics in the shale plays.
3. Engineered completions: While the above methods can increase production per well or per stage, the traditional geometric completion methods do not tackle the low percentage of producing stages. Many operators have started to experiment with engineered fracs by understanding the geomechanical properties of the reservoir along the wellbore and hence placing the frac stages along the areas with highest production potential.
Despite the above efforts, many believe that unless we accelerate our understanding of the fundamental physics of unconventional resources such as rock fracture patterns and processes, the only path ahead is experimental design. This means that those operators bold enough to push the envelope will learn faster than others. Those operators are also looking to outside help and there’s no shortage of solutions at varying stages of maturity out there.
Over the remaining two months of our research into this space, we’ll be high-grading the solutions and their creators, showcasing the most promising technologies so that our clients can continue to improve margins and efficiency in this cycle of low commodity prices.
Explore new solutions in this space at Darcy Analytics forum.
Darcy Partners is a research and advisory firm specializing in emerging technologies.