#300, 630 - 6th Ave SW Calgary, Alberta T2P 0S8 … · 03-15-11-29w1 1100 18 0.0019 total - 210...

#300, 630 - 6th Ave SW Calgary, Alberta T2P 0S8 Ph.(403) 264-2526 Fax (403) 264-9512

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February 8, 2010 Manitoba Science, Technology, Energy & Mines Petroleum Branch Box 1359 – 227 King Street Virden, MB R0M 2C0 Attention: Bruce Dunning

Re: Application for Oil Battery Permit Kirkella 14-10-011-29W1

On behalf of Reliable Energy Ltd., Asher Engineering Ltd. is submitting an application to obtain a permit for construction and operation of an oil battery.

Enclosed, please find the required documentation as per Section 75(1) of the Drilling and Production Regulations.

If you have any questions or concerns regarding this application please contact Sarah Williams at Asher Engineering Ltd. (403-264-2526 ext 243).

Regards,

Sarah Williams Asher Engineering Ltd. cc: Rob Morrison, Reliable Energy Ltd. Attachments

Manitoba STEM Battery Application Asher Project #1400 Kirkella 14-10-011-29W1 February 8, 2010

ASHER ENGINEERING LTD. EPCM

1. Application Fee and Levy

A cheque in the amount of $500.00 payable to the Minister of Finance is enclosed as required.

2. Performance Deposit

As per MSTEM, no additional performance deposit is required to obtain this battery operating permit.

3. Survey Plan

Two copies of a survey plan of the battery location are included in Attachment A.

4. Landowners and Occupants

A list of landowners and occupants within 1.5km of the proposed battery location as well as a summary of the consultation process and any concerns raised are included in Attachment B.

5. Wells to be Tied in

The following wells will immediately be tied-in to the proposed battery at 14-10:

• 05-10-11-29W1 • 06-10-11-29W1 • 11-10-11-29W1 • 12-10-11-29W1 • 13-10-11-29W1 • 14-10-11-29W1 • 03-15-11-29W1

In future, the 06-10-11-29W1 and 13-10-11-29W1 sites will act as satellites and will gather additional production to the battery. There are an additional three ( 3 ) wells that are to be drilled in Q1 / 2010 and it is anticipated that these sites will be tied into this facility. In addition the company anticipates being active in 2010 drilling additional development wells in the area of and around the central site.

6. Anticipated Production Rates

The anticipated flow rates entering the 14-10 battery are:

Oil: 94 m3/d Water: 141 m3/d Gas: 0.61 e3m3/d (GOR = 6.5 m3/m3)

Initially the production will be as follows:

Oil: 24 m3/d Water: 51 m3/d Gas: 0.29 e3m3/d (GOR = 6.5 m3/m3)

Currently, welltests are being completed to determine the produced GOR for the wells. The most recent test indicated a maximum GOR of 3.93 m3/m3. However, it is possible that higher GORs may be encountered at some of the wells, therefore a GOR of 6.5 m3/m3 was used to determine the licensed gas rate for the battery as well as for the dispersion modeling.



All of the gas on site will be vented from tanks. There will not be any gas used for fuel or flared.

7. Gas Analysis

A Representative gas analysis is included in Attachment C. There has been H2S detected at some of the wells that will be tied into the battery. Measurements taken on January 21, 2010 are as follows:

Well H2S Gas Rate* H2S ppm m3/d mol/day

05-10-11-29W1 600 47 0.0026

06-10-11-29W1 3400 20 0.0062

11-10-11-29W1 5 0 0.0000

12-10-11-29W1 0 17 0.0000

13-10-11-29W1 0 39 0.0000

14-10-11-29W1 900 69 0.0058

03-15-11-29W1 1100 18 0.0019

Total - 210 0.0165

Combined H2S conc. 843 - - Using oil rate at Dec 8, 2009, assuming GOR= 6.5 m3/m3.

An H2S concentration of 843 ppm was used to complete the required dispersion modeling.

8. Radius of Exposure

Based on the above noted gas rates and H2S concentration, the battery is a Class 1 facility with a radius of exposure of 2.50m. The calculations are included as Attachment D.

9. Process Vessels

There will not be any process vessels used at this battery. The battery will consist of an inlet header and production tanks.

10. Well Testing

Individual wells will flow through a test header and into a test tank at the battery. The watercut of individual wells will be determined using tank gauging (i.e. the total tank volume will be recorded, then the water will be pumped out and the remaining tank volume will again be recorded). Each of the two satellite locations (06-10 and 13-10) are equipped with both a test line and a group line. During a test, individual wells will flow through the test line to the battery and into the test tank. Tests will have a minimum duration of 24 hours. The testing frequency will be once per quarter per well.

11. Flare and Vapour Recovery

There will not be any flare or vapour recovery system in place at the battery.



12. Venting

All gas produced to the site will be vented directly from the tanks through vent pipes. The majority of the gas is expected to vent from the settling tank which has a height of 7.6m and will also have a 2m high vent pipe. It is expected that there will be some venting of gas from the oil and water tanks also. Each of these tanks will also be equipped with a 2m high vent stack.

Once the battery is operating, Reliable plans to test the volumes of gas. If it varies from what is anticipated, Reliable will react accordingly.

13. Air Dispersion Modeling

Air dispersion modeling results have been included as Attachment E. At the licensed oil production rate of 94 m3/d with a GOR of 6.5 m3/m3, the maximum 1 hour concentration of H2S is 14.20 μg/m3. This meets the guidelines for H2S emissions.

14. Plot Plan

Two copies of a plot plan of the proposed battery at 14-10 are included in Attachment F.

15. Process Flow Diagram

Two copies of a process flow diagram of the proposed battery at 14-10 are included in Attachment F.

Well production is gathered to an inlet header at the battery site. There are currently seven (7) wells that will produce to the battery with an anticipated three (3) additional wells to be drilled during the course of Q1 / 2010. In addition the company anticipates being active in 2010 drilling additional development wells in the area of and around the central site.

The header consists of a group production line and a test line. As discussed above, the test line will be used to gather production from individual wells to a test tank. The group line will send all production to a settling tank. Gas will be vented from the settling tank. Oil will flow to two (2) oil storage tanks from which it will be trucked out on a daily basis. Water will flow to three (3) water storage tanks. Initially water will also be trucked out. However, within one year of the initial startup of the battery, a water disposal package will be added to the battery. It is anticipated that the water disposal package will include a charge pump and injection pump.

16. Water Disposal

In the immediate future, the produced water will be trucked to various water disposal wells including Tundra 13-36-09-29W1, Tundra 06-29-10-26W1, Kiwi 07-18-10-29W1 and the Black Gold battery located at 12-33-8-28. Within the next year, a disposal pump package will be added to the battery along with a flowline to a nearby disposal well. The exact location of this well has not yet been determined.

Manitoba STEM Battery Application Asher Project #1400 Kirkella 14-10-11-29W1M February 8, 2010


Attachment A

Survey Plan



Attachment B

Landowners and Occupants



Attachment C

Gas Analysis

Total

COMPONENTMOLE FRACTION

AIR FREE ASRECEIVED

MOLE FRACTIONAIR FREE

ACID GAS FREE

mL/m³AIR FREE AS

RECEIVED

H2 0.0033 0.0033

He

0.6434

0.0001 0.0001

N 0.64352

CO2 0.0004 0.0000

H2S

0.0246

0.0352

0.0000 0.0000

C1 0.0351

C2 0.0659 0.0660 234.2

C3 0.1401 0.1402 514.8

iC4 0.0247 107.4

C4 0.0528 0.0528 222.1

iC5 0.0091 0.0091

C5

C

CALCULATED GROSS HEATING VALUE CALCULATED VAPOR PRESSUREMJ/m³ @ 15°C & 101.325 kPa (abs.) kPa (abs.) @ 40 °C

34.03 34.04 89.6MOISTURE FREE MOISTURE & ACID GAS FREE PENTANES PLUS

CALCULATED TOTAL SAMPLE PROPERTIES (AIR=1) @ 15°C & 101.325 kPaMOISTURE FREE AS SAMPLED

kg/m³ 1.174 34.0DENSITY RELATIVE DENSITY RELATIVE MOLECULAR MASS

CALCULATED PSEUDOCRITICAL PROPERTIESAS SAMPLED ACID GAS FREE

3673.2 kPa (abs) K kPa (abs)

pPc pTc pPc

C PROPERTIES @ 15°C & 101.325 kPa7+

DENSITY MOLECULAR WEIGHT

C

0.0111

0.0069

0.0111

0.0070

0.0071

1.0000

44.4

53.7

36.7

40.2

1,253.5

209.4 3671.9 209.4

1.438

97.4

6

7+ 0.0071

1.0000

734.7 kg/m³

pTc

K

LOCATION

0.0000000 Field

METHODMOLE FRACTION

OtherHYDROGEN SULPHIDE

REMARKS:

H2S was not detected in the field.

Field sampling temperature was not provided.

NOTE: THE GROSS HEATING VALUE HAS BEEN CALCULATED IN ACCORDANCE TOAGA REPORT #5 AND ALL PROPERTIES HAVE BEEN CALCULATED UTILIZINGGPA 2145 - 09 PHYSICAL CONSTANTS AND BOILING POINT GROUPING.

EXTENDED GAS ANALYSIS

2PAGE

GR ELEV (m)KB ELEV (m)

POOL OR ZONE SAMPLER

Bakken Baker

TEST RECOVERY

POINT OF SAMPLE

m³/d m³/dOIL

PUMPING FLOWING SWABGAS LIFT

WATER m³/d GAS

SEPARATOR

Temperatures, °CRESERVOIR SEPARATOR

DATE RECEIVED (Y/M/D) DATE ANALYZED (Y/M/D)

2009 11 24ANALYST

2009 11 132009 11 09

Pressures, kPa (gauge)

°C

CONTAINERWHEN SAMPLED

@ 22 °C10CONTAINER

WHEN RECEIVED

@

South Kirkella

TEST TYPE AND NO.

Reliable South Kirkella 14-10-11-29

Reliable Energy Ltd.OPERATOR

WELL NAME

FIELD OR AREA

CONTAINER IDENTITY

DATE SAMPLED (Y/M/D)

10:30 Hrs

AMT. AND TYPE CUSHION MUD RESISTIVITY

TUN @ °C

WELL LICENSE NUMBER

V0008872 - 3 7077

SAMPLE POINT ID

Wellhead Casing

METER ID

52134-2009-4366LABORATORY FILE NUMBER

100/14-10-011-29W1/00LOCATION (UWI)

TEST INTERVAL or PERFS (meters)

OTHER

7OTHER



Attachment D

Tank Venting Rates Calculation Radius of Exposure Calculation

Tank Venting Rates CalculationRadius of Exposure Calculation

Project: Kirkella 14-10-011-29W1 Oil BatteryAsher Project: 1400Client: Reliable Energy Ltd.Revision: 1475 bbl/d, GOR 6.5 m3/m3

Basis: Gas analysis

Key: Calculated valueEntered value

H2S Emission Rate

H2S concentration 843 ppmH2S concentration 0.0843 %GOR 6.5 m3/m3

Watercut 60 %Fluid Rate 1475 bbl/d

234.50 m3/dWater Rate 140.70 m3/dOil Rate 93.80 m3/dGas Rate 609.70 m3/d

0.0071 m3/slbmol H2S/day 0.0479 lbmol/dayMW H2S 34.08 lb/lbmolH2S Emission Rate 0.74 kg/dayH2S Emission Rate 0.00857 g/s

Radius of Exposure

Gas Rate, Q 609.70 m3/dH2S concentration, [H 2 S] 0.000843 fracRadius of Exposure, R 2.50 mBattery Class Class 1

[ ]{ } 6258.0211.563048.0 QSHR ∗∗∗=

Asher Engineering Ltd.EPCM 2/5/2010



Attachment E

Dispersion Modeling



Attachment F

Plot Plan Process Flow Diagram

#300, 630 - 6th Ave SW Calgary, Alberta T2P 0S8 … · 03-15-11-29w1 1100 18 0.0019 total - 210...

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