BENCHMARKING RESOURCE PLAYS - Canadian …€¦ · BENCHMARKING RESOURCE PLAYS ... SPEE Monograph 3 “Guidelines For The Practical Evaluation of Undeveloped Reserves in Resource

BENCHMARKING RESOURCE PLAYSImplications for Exploitation & Development

Mike Seifert, P. Geol.Canadian Discovery Ltd.

February 15, 2012

AGENDA IntroductionWhat is a Resource PlayBenchmarking Process

Western Canada Overview Montney Slave Point Integrated Analysis: Carrot Creek and Rat Creek

WHAT IS A RESOURCE PLAY?“A 'play' is a family of pools and/or prospects that share a commonhistory of hydrocarbon generation, migration, reservoir developmentand trap configuration.

A RESOURCE PLAY is a special category of play which impliesthe use, or potential use, of advanced drilling and/or completiontechnology to make it economic.

Although specific wells may be exceptions, generally speaking aRESOURCE PLAY is deemed to be historically uneconomic on aregional basis without the use of advanced technology.”

Ed Fogg, Canadian Discovery Ltd.

RESOURCE PLAY DEFINITIONRequires Extensive Stimulation to

Produce Produces Little In-situ Water Does Not Exhibit an Obvious Seal or Trap Low Matrix Permeability (< 0.1 mD)

SPEE Monograph 3“Guidelines For The Practical Evaluation of Undeveloped Reserves in Resource Plays”

WHY BENCHMARK?

Internal AnalysisCompetitor AnalysisTechnologies and MethodologiesLogisticsAcquisition & DivestituresFinancial Metrics

0

5

10

15

20

25

Bakken Cardium Horn River Montney

Average Stages Completed / Year

200620072008200920102011

RESOURCE PLAYS INWESTERN CANADA

0

500

1000

1500

2000

2500

Bakken Cardium Horn River Montney

Average Completed Length

200620072008200920102011

RESOURCE PLAYS INWESTERN CANADA

0

50

100

150

200

250

300

350

Bakken Cardium Horn River Montney

Average Frac Spacing

200620072008200920102011

RESOURCE PLAYS INWESTERN CANADA

0

50

100

150

200

250

Bakken Cardium Horn River Montney

Average Proppant / Stage (t)

200620072008200920102011

RESOURCE PLAYS INWESTERN CANADA

$11 $114

$1,553

$337

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

0

200

400

600

800

1000

1200

Bakken Cardium Horn River Montney

IP BOE/d (6:1)

Completion Cost($K/Stage)

Average IP (BOE/D) & Completion Cost ($K/Stage)2010 / 2011 Wells

RESOURCE PLAYS INWESTERN CANADA

0

1,000

2,000

3,000

4,000

5,000

6,000

2008 2009 2010 2011

Num

ber o

f Wells

Year

Horn River GasMontney/Doig GasMontney/Doig OilDeep Basin GasSlave Point/Swan Hills OilGlauconitic Hoadley GasCardium OilViking OilShaunavon OilBakken/Torquay OilSpearfish/Amaranth OilEmerging OilEmerging Gas

3,860

5,041

1,7531,922

Number of Wells by Resource Play Group

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

2008 2009 2010 2011

Completion Co

st (m

illion $)

Year

Horn River GasMontney/Doig GasMontney/Doig OilDeep Basin GasSlave Point/Swan Hills OilGlauconitic Hoadley GasCardium OilViking OilShaunavon OilBakken/Torquay OilSpearfish/Amaranth OilEmerging OilEmerging Gas

$5.5 billion

$7.9 billion

$2.5 billion

$2.0 billion

Completions Investment ($M) by Resource Play Group

Increasing StagesIncreasing Well LengthDecreasing Frac SpacingProppantBakken DecreasingMontney Increasing

RESOURCE PLAYS INWESTERN CANADA

NORTHERN MONTNEY

Source: Canadian Discover Ltd., EDGE Software

0

2

4

6

8

10

12

14

16

01/06/2008 18/12/2008 06/07/2009 22/01/2010 10/08/2010 26/02/2011 14/09/2011 01/04/2012

Stages Completed

PROGRESS BONAVISTA CANBRIAN TALISMAN

NORTHERN MONTNEY

0

500

1000

1500

2000

2500

01/06/2008 18/12/2008 06/07/2009 22/01/2010 10/08/2010 26/02/2011 14/09/2011 01/04/2012

Completed Length (m)

PROGRESS BONAVISTA CANBRIAN TALISMAN

NORTHERN MONTNEY

0

200

400

600

800

1000

1200

01/06/2008 18/12/2008 06/07/2009 22/01/2010 10/08/2010 26/02/2011 14/09/2011

Completion Cost / Stage ($K)

Bonavista Canbriam Progress Talisman

NORTHERN MONTNEY

0

2000

4000

6000

8000

10000

12000

01/06/2008 18/12/2008 06/07/2009 22/01/2010 10/08/2010 26/02/2011 14/09/2011 01/04/2012

IP Gas (mcf/d)

PROGRESS BONAVISTA CANBRIAN TALISMAN

NORTHERN MONTNEY

0

200

400

600

800

1000

1200

09/09/200818/12/200828/03/200906/07/200914/10/200922/01/201002/05/201010/08/201018/11/201026/02/201106/06/2011

6 MO. Cal Gas Rate / Stage (mcf/d)

PROGRESS BONAVISTA CANBRIAN TALISMAN

NORTHERN MONTNEY

0

2000

4000

6000

8000

10000

12000

0

2000

4000

6000

8000

10000

12000

0 50 100 150 200 250 300 350Average Proppant / Stage (t)

IP GAS (mcf/d) 6 Mo Cal Gas Rate (mcf/d)

NORTHERN MONTNEY

05000

100001500020000250003000035000400004500050000

0 50 100 150 200 250 300 350Average Proppant / Stage (t)

Total Fluid Pumped (m3)

NORTHERN MONTNEY

NoYes

Use of Cluster Fracs

NORTHERN MONTNEY

TALISMAN VS PROGRESSLonger Well LengthsMore Stages / WellGreater Cum Production

NORTHERN MONTNEY SUMMARY

Source: Canadian Discovery Ltd.

SLAVE POINT

0

5

10

15

20

25

30

35

10/10/2006 22/02/2008 06/07/2009 18/11/2010 01/04/2012

Stages Completed

EVI OTTERJUDY CR. ETHELSWAN HILLS SWAN HILLS SOUTH

SLAVE POINT

0200400600800

100012001400160018002000

06/07/2009 22/01/2010 10/08/2010 26/02/2011 14/09/2011 01/04/2012

Completed Length (m)

EVI OTTERJUDY CR. ETHELSWAN HILLS SWAN HILLS SOUTH

SLAVE POINT

0

100

200

300

400

500

600

10/10/2006 22/02/2008 06/07/2009 18/11/2010 01/04/2012

Completion Cost / Stage ($K)

EVI OTTERJUDY CR. ETHELSWAN HILLS SWAN HILLS SOUTH

SLAVE POINT

0

100

200

300

400

500

600

06/07/2009 22/01/2010 10/08/2010 26/02/2011 14/09/2011

IP Oil (bop/d)

EVI OTTERJUDY CR. ETHELSWAN HILLS SWAN HILLS SOUTH

SLAVE POINT

0

50

100

150

200

250

0 10 20 30 40 50 60Average Proppant / Stage

OTTER IP (bopd) EVI IP (bopd)OTTER 6 Mo Rate (bopd) EVI 6 Mo Rate (bopd)

SLAVE POINT

0

50

100

150

200

250

OTTER EVI JUDYCR

ETHEL SWANHILLS

SWANHILLS S.

Slave Point Oil Rate by Field

IP OIL (bopd) 6 Mo Rate (bopd) 12 mo Rate (bopd)

SLAVE POINT

010203040506070

OTTER EVI JUDYCR

ETHEL SWANHILLS

SWANHILLS S.

Slave Point Oil Cums by Field

6 Mo. CUM OIL (mbo) 12 Mo. CUM OIL (mbo)18 Mo. CUM OIL (mbo)

SLAVE POINT

EVI JUDY CREEK

Proppant No Proppant

~$125/stage ~$150/stage

12 stages 15 stages

400 – 500 m 1,000 m

GEOLOGY MATTERS

SLAVE POINT SUMMARY

Source: CDL Cardium Overview Study, 2010

CARDIUMRat Creek / Carrot Cr

Detail: Minimum Principal Stress , Pembina Field

R7W5MR13

T46

T52

Source:  Stress Analysis Study, RPCL & BJ, 2005 and the Well Completions & Frac Database

CARDIUMRat Creek / Carrot Creek

0

5

10

15

20

25

0 5 10 15 20 25

ATTEMPT

ED STA

GES

ACTUAL STAGES

Carrot Creek vs. Rat Creek

Carrot Creek

Rat Creek

CARDIUMRat Creek / Carrot Creek

24

9

5

1

23

14

6

3

0

5

10

15

20

25

30

<10% 10‐30% 30‐50% >50%

Num

ber o

f Wells

Estimated Completion Problem Time (%)

Well Count vs. Completion Problem Time

Carrot Creek

Rat Creek

CARDIUMRat Creek / Carrot Creek

0

50

100

150

200

250

Oil Slickwater Water

AVER

AGE IP (B

OPD

)

BASE FLUID

Initial Production vs. Base Fluid and Energizer

CARROT CREEK ‐ N2

CARROT CREEK ‐UNENERGIZED

RAT CREEK ‐ N2

RAT CREEK ‐ UNENERGIZED

12

14

3

44

12

14

15

213

CARDIUMRat Creek / Carrot Creek

Cardium Horizontal 3-Month Initial Production Rate Map

Base map generated with ArcMap ™

Carrot Creek vs. Rat Creek Hz Wells - type Prod decline curves

Data Source IHS Energy

Average IP Rate by Wellbore Orientation

Data Source IHS Energy

46 - Number of Wells

Rat Creek Higher StressOperational FailuresBase Fluids & Energizers

CDD Article “Stressed Out in the Cardium”

CARDIUMRat Creek / Carrot Creek

ACKNOWLEDGMENTS

• Matt Baird• Razan Das, E.I.T.• Meridee Fockler, P.Geol.• Ally Masoud• Daniel LaPlante• Heather McCrank, MBA, CMA• Aliyyah Mohamed, B.A.• Kevin Rakhit, B. Sc.• Neil Watson, P.Geol.

• Jean Beriault, P.Eng.• Andrea Nawolsky, C.E.T.• John Siferd, R.E.T.• Peter Singbeil, P. Eng.• Don Waters, P.Eng.