GCA: Integrated Reservoir Modelling - Gaffney Cline Bloggaffney-cline-focus.com/.../Integrated_Reservoir_Modelling_short.pdf · • Geology & Geophysics Reservoir Engineering •

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gaffney-cline.com

© 2016 Gaffney, Cline & Associates. All rights reserved. Terms and conditions of use: by accepting this document, the recipient agrees that the document together with all information included therein is the confidential and proprietary property of Gaffney, Cline & Associates and includes valuable trade secrets and/or proprietary information of Gaffney, Cline & Associates (collectively "information"). Gaffney, Cline & Associates retains all rights under copyright laws and trade secret laws of the United States of America and other countries. The recipient further agrees that the document may not be distributed, transmitted, copied or reproduced in whole or in part by any means, electronic, mechanical, or otherwise, without the express prior written consent of Gaffney, Cline & Associates, and may not be used directly or indirectly in any way detrimental to Gaffney, Cline & Associates’ interest.

GCA: Integrated Reservoir Modelling

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GCA Advisory Services: A Global Perspective

Buenos Aires Sydney

Dubai

Singapore

London

Houston

GCA: Independent Advisors to the E&P Industry for over 50 years

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GCA Advisory Services: An Integrated Approach

Midstream

• Gas Commercialisation • Transportation • Processing • Storage • Operations

Downstream

• LNG • Refining • Chemicals • Power • Markets

Functions Upstream

• Geology & Geophysics • Reservoir Engineering • Drilling and Completion • Development Planning • Cost and Schedule • Project Execution

• Integration • Economics • Commercial & Financing • Legal, Regulatory & Fiscal • Strategy & Planning • Business Process • Performance Management

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GCA Advisory Services: Integrated Reservoir Modelling

▪ “Integrated Reservoir Modelling” (IRM) is a fully combined view of the reservoir, which typically includes:

▪ 2D & 3D seismic interpretation (e.g. IHS Kingdom Advanced, Petrel Seismic, DUG) ▪ Well log correlation (e.g. Petrel, Kingdom) ▪ Map generation (e.g. IHS EarthPAK, Petrel) ▪ Petrophysics (e.g. Techlog, Geolog) ▪ Rock properties (e.g. Terrastation, IKON RokDoc, Geoscience Workbench) ▪ Static geomodel - probabilistic and geostatisical (e.g. Petrel, Jewel Suite or RMS) ▪ Classical engineering (e.g. IPM-PVTP, PanSystem, Saphir, Harmony, OFM) ▪ Well performance (e.g. Prosper, Amethyste) ▪ Networks (e.g. GAP) ▪ Material balance (e.g. MBAL) ▪ Dynamic (e.g. ECLIPSE, CMG suite (IMEX/GEM/STARS))

▪ GCA uses small, multi-disciplinary teams to fully integrate data

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▪ Integrated Reservoir Modelling provides: – A robust subsurface description – Insight into uncertainty and risk – Improved or protected value

▪ Integrated Reservoir Modelling is necessary for: – Field Development Planning – Project Investment Risk Management

(PIRM) (an integrated GCA service to ensure that projects meet the anticipated return)

– Unitisation and Redetermination, etc. ▪ Integrated Reservoir Modelling

techniques should also be applied to Reserves Audits

GCA Advisory Services: Who needs Integrated Reservoir Modelling?

DUE DILIGENCE FOR

PROJECT FINANCE

UNITISATION

RESERVES & RESOURCES

DEVELOPMENT PLANNING &

OPTIMISATION

IPOs & CPRs

RISK MANAGEMENT AND

SURVEILLANCE

ASSET EVALUATION / ACQUISITION

SUPPORT

STRATEGIC PLANNING & ADVICE

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GCA Advisory Services: Why use GCA for Model-building?

▪ GCA Quality – GCA provides a dedicated project team with specialist skills and tools – The project team has continuous access to GCA’s corporate experience – Ongoing review and oversight of the project

▪ GCA Experience – GCA brings extensive experience in all aspects of modelling - globally and

in every conceivable reservoir type, but recognises that each field or project requires a fresh approach. Experience includes: ▪ Immiscible and miscible floods, ▪ Clastic, carbonate or fractured reservoirs, ▪ Black oil and volatile oil, ▪ Gas and gas-condensate reservoirs, and; ▪ New or mature fields

▪ To assist and/or complement company internal capability

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GCA Advisory Services: IRM to Prepare a Field Development Plan

GCA provided the complete Field Development Plan…

…to well log analysis… …to populating the static model… …to generating structural surfaces … …from interpreting seismic…

…upscaling to construct the dynamic model…

…through to the fully-costed Field Development Plan for

this major field

RESERVOIR

2 kmWell Pad

4 km Step-out

App

rox.

4 k

mR

eser

voir

Dep

th

SALT

with associated numbers of wells, well type and design…

and creating a range of production forecasts…… and surface facilities……

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GCA Advisory Services: Why have an Existing Model Reviewed?

▪ Many clients value GCA’s independent review of their existing models, for the reasons already mentioned and a few others

▪ Why does an independent review/audit help to maximise value? – Oversight and feedback on original Model-Builder, not always the Client ▪ A model is built by the Operator, who may have different priorities to a

Partner or a Finance Company and may not be up-to-date – No “groupthink” ▪ GCA will provide thorough, independent reviews with no fear of

challenging any existing decision-making process – Staged Approach ▪ The independent review can be as big or small as needed

– GCA often uses a staged approach for its projects, with an initial “quick-look” followed by a more detailed enquiry into aspects identified as requiring attention

▪ Preparing for Reserves Audits – These typically include reviewing the existing models – Audit ensures models are in good order before Reserves are due

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GCA Advisory Services: IRM to Audit an Existing Model

Age

Form

atio

n

Sequ

ence Basinal Shelfal

Mio

cene

Olig

ocen

e

Eocene

Paleocene

Pre-Tertiary

Pliocene-Quaternary

Early

Early

Late

Late

Mid

dle

Upper

Lower

Upper

Middle

Lower E

D

C

B1.1

B II

B III

ABien Dong

Dong Nai

Con Son

Bac

h H

oTr

aTa

n

R

R

R

S

R

Basement

Legend:MudSandLimestone

BasementCoalFractures

Reservoir

Source

R

S

GCA provided a Reserve Audit …

…and highlighted a number of inconsistencies in calculating hydrocarbons-in-place

The Client took account of these inconsistencies and re-engaged GCA the following year to confirm the Reserves,

despite the volumetric reduction.

…including regional geology and fault

seal analysis

…well results and reservoir

characterisation

…structure and mapped spill points …fluid contacts and field performance

y = 14.5x - 23730R² = 1

y = 2.212x + 108.2R² = 1

y = 2.714x - 910.1R² = 0.999

y = 2.676x - 816.9R² = 0.999

y = 25.79x - 45362R² = 0.997

3,900

4,000

4,100

4,200

4,300

4,400

4,500

4,600

4,700

4,800

4,900

1750 1800 1850 1900 1950 2000 2050 2100 2150 2200 2250

a2_oila3_oila3_wata4_gasa4_oila4_wata5A_oila5A_wata6_wata6_oila6_gasa8_wata8_oila8Z_wata8Z_oila8Z_gas9109 water9 oil10 oil10 gasLinear (a2_oil)Linear (a3_wat)Linear (a4_gas)Linear (a4_oil)Linear (a4_wat)Linear (a5A_oil)Linear (a5A_wat)Linear (a6_wat)Linear (a6_oil)Linear (a8_wat)Linear (a8Z_wat)Linear (a8Z_gas)Linear (9 water)Linear (9 oil)Linear (10 oil)Linear (10 gas)

0

50,000

100,000

150,000

200,000

250,000

300,000

0

50,000

100,000

150,000

200,000

250,000

Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15

Oil Rate Water Rate

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GCA Advisory Services: For the Entire Investment Lifecycle

Strategic Advisory Integrated Reservoir Management Surface Technical & Commercial Gas Commercialisation

Commercial & Economics Operations & Planning Advisory Risk Management

Strategy Appraisal Concept Selection

Technical Definition

Development Operations Sanction

Growth Strategies

Valuations, Due Diligence

Opportunity Screening

Opportunity Identification

Policies & Processes

Exploration Strategy

Fiscal Terms Cashflows, Economics, Audits.

Gas Sales & Purchase Agreements Commercial Agreements

Markets and Prices

Gas Conversion Options Gas Commercialisation Plans License

Agreements Technology Selection

Execution Planning

Regulatory Compliance

Infrastructure & Logistics

Conceptual Design

Feasibility Studies, CAPEX, OPEX, Development Schedule

Development Plans & Costs Design Audits Budget Review &

Audit

Risk Mitigation FID Baseline Appraisal Baseline

Risk Management

Risk Identification

Decision Support Packages (FDP, PEP, WBS, EIA), TCMs & OCNs Execution Support

Operations Support

JOAs and Partnerships

Resources Estimates & Audits Reservoir Characterisation, Reserves Audits, Unitisation. Production Forecasts

Reservoir Management Dynamic Reservoir Modelling GCoS Assessment Reserves and Resources Estimates

Transaction Support & Integration

Gas Master Plans

PSC Terms

License Rounds

FDP Audits Cost Audits Mature Field Redevelopment

Operations Planning

OPEX Optimisation

LNG Strategy & Markets

Development Strategy

Technology Assessment

Acquisition

CPRs, IPOs and Divestments

Project Surveillance

Performance Monitoring

Market Options

Resource Estimates

Geophysical and Geological Evaluation & Modelling Reservoir Depletion Planning Production Enhancement

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Confidentiality and Disclaimer Statement

This document is confidential and has been prepared for the exclusive use of the Client or parties named herein. It may not be distributed or made available, in whole or in part, to any other company or person without the prior knowledge and written consent of GCA. No person or company other than those for whom it is intended may directly or indirectly rely upon its contents. GCA is acting in an advisory capacity only and, to the fullest extent permitted by law, disclaims all liability for actions or losses derived from any actual or purported reliance on this document (or any other statements or opinions of GCA) by the Client or by any other person or entity.