Enhance Oil Recovery

OPTIMIZATION OF PRODUCTION

Enhanced Oil Recovery (EOR)

OPTIMIZATION OF PRODUCTION

Enhanced Oil Recovery (EOR)

TIORCO, Inc – The Improved Oil Recovery Company

OutlineOutline

• Oil Supply/Demand and Distribution of Oil Reserves

• Oil Recovery Mechanisms and EOR Targets• Types of EOR Technologies and EOR Candidates• Worldwide EOR Production • Average EOR Recovery Factors• EOR Economics• Reasons for EOR Failures • Conclusions


Oil Consumption and IndustrializationOil Consumption and Industrialization

1900

Per C

apita

(Bbl

s / Y

ear

35

1910 1920 1930 1940 1950 1960 1970 1980 1990 2000

30

25

20

15

10

5

0

U.S.

Japan SouthKorea

China India

Oil Consumption Increases Fastest During Early IndustrializationOil Consumption Increases Fastest During Early Industrialization


Chinese Oil ImportsChinese Oil Imports

-500

0

500

1,000

1,500

2,000

2,500

3,000

1Q93 1Q94 1Q95 1Q96 1Q97 1Q98 1Q99 1Q00 1Q01 1Q02 1Q03 1Q04 1Q05

kb/d

0

5

10

15

20

25

30

35

40

45

50

US

$/bb

l

Net Crude Imports

NYMEX WTI


U.S. Petroleum Production and ImportsU.S. Petroleum Production and Imports

12

‘53

Year

Pet

role

um (

MM

BB

LS/D

ay) 10

8

‘48 ‘58 ‘63 ‘68 ‘73 ‘78 ‘83 ‘88 ‘93 ‘98

Domestic Petroleum Production

Imported Petroleum

6

4

2

0


Others112B Bbls - 10%

FSU78B Bbls - 7%

South America62B Bbls - 5%

North Africa60B Bbls - 5%

West Africa46B Bbls - 4%

Regional Distribution of Global Oil ReservesRegional Distribution of Global Oil Reserves

Middle East734B Bbls - 64%

North Sea14B Bbls - 1%

North America62B Bbls - 4%


Oil Recovery MechanismsOil Recovery Mechanisms

CONVENTIONAL RECOVERY

EOR

TERTIARYRECOVERYTERTIARY

RECOVERY

SECONDARYRECOVERY

SECONDARYRECOVERY

PRIMARYRECOVERYPRIMARY

RECOVERY NaturalFlow

NaturalFlow

Artificial Lift(Pump, Gas Lift, etc.)

Artificial Lift(Pump, Gas Lift, etc.)

WaterfloodWaterflood Pressure Maintenance(Water, Gas Reinjection)Pressure Maintenance

(Water, Gas Reinjection)

ThermalThermal SolventSolvent ChemicalChemical OtherOther

Adapted from the Oil & Gas Journal, Apr 23, 1990


Primary recovery lasts for several months or years.

As the pressure drops, flow slows and operators must use “secondary recovery” techniques for to recover petroleum.

The most common technique: injection of water or gas Water injection also is used to increase production, but usually leads to a quicker reservoir decline and less total production

Tertiary recovery” techniques may be used once the injection techniques are ineffective. However, they’re expensive, and thus feasible only if the price of petroleum is high....


Expected Oil Recovery EfficienciesExpected Oil Recovery Efficiencies

PRIMARY METHODS

Liquid and Rock Expansion

Solution Gas Drive

Gas Cap Expansion

Gravity Drainage

Water Influx

SECONDARY METHODS

Gas Reinjection

Waterflooding

Up to 5

20

30

40

60

Up to 70

OOIP (%)

Sandrea, Oil & Gas Journal (Nov 2007)


EOR Targets: % OOIPEOR Targets: % OOIP

LIGHT OILSLIGHT OILS HEAVY OILSHEAVY OILS TAR SANDSTAR SANDS

Assumes Soi – 85% PV and Sw = 15% PV

EOR Target45% OIP

Secondary5% OIP

Primary25% OIP

EOR Target100% OIP

Primary5% OIP

Secondary30% OIP EOR Target

90% OIP

Thomas, Oil & Gas Science and Technology (2008)


EOR Targets, 2005EOR Targets, 2005

Discovered Unrecoverable by Current Technology377 Billion Barrels

Cumulative Production183 Billion Barrels

Proven Reserves22 Billion Barrels

Undiscovered Recoverableby Current Technology

30 Billion Barrels

Undiscovered Unrecoverableby Current Technology37 Billion Barrels

Target for EOR TechnologiesTarget for EOR Technologies

Target for AdvancedExploration TechnologyTarget for AdvancedExploration Technology

(45% already abandoned)

US Department of Energy (2005)


EOR Targets, 2007EOR Targets, 2007United

States Canada

Rest of

World

TOTALS

(B bbls)

Cumulative Production 234 31 813 1,078

OPEC (Middle East) -- -- 662 662

Other Conventional 19 7 378 404

Deepwater 8 3 50 61

Arctic 5 3 110 118

Enhanced Oil Recovery 76 6 510 592

Extra Heavy -- 167 227 444

Oil Shale Extract 500 4 200 704

Exploration Potential 83 15 660 758

TOTALS (B bbls) 925 236 3660 4,821

Jackson, JPT (2007)


Definition of EORDefinition of EOR

• Oil Recovery by Injection of Fluids not normally present in the reservoir

• Excludes waterflooding


Thermal EOR MethodsThermal EOR Methods

THERMAL

Hot Water Steam In-Situ Elec. Heat

CSS SteamFlood SAGD Conductive

Heating Forward ReverseHi Press.

Air Inj.

Frac

Non-Frac

VAPEX

VAPEX + Steam

SAGP

Dry

Wet

W / Additives

THAI

CAPRI


Non-Thermal EOR MethodsNon-Thermal EOR Methods

NON-THERMAL

Miscible Chemical Imm. GasDrives Other

Flue Gas

CO2

Inert Gas

FOAM

MEOR

Surfactant

Polymer

Alkaline

Enriched Gas Drive

Slug Process

N2 Miscible

CO2 Miscible

Alcohol

ASP

Micellar

Emulsion

Vaporizing Gas Drive


EOR vs. DepthEOR vs. Depth

HydrocarbonMiscible

Nitrogen andFlue Gas

CO2

MiscibleSurfactantPolymer

Polymer

Alkaline

Fireflood

Steam Drive

EOR Method

Deep enough for required pressure

Limited by temperature

Depth (feet)10,0008,0006,0004,0002,000

Good Possible Fair Difficult Not Feasible




Limited by temperature

Dr. Larry Lake, Oilfield Review (Jan. 1992)


Oil Resources by DepthOil Resources by Depth

DEEP 21%2.7 Trillion Bbls

(>10,000 Ft)

INTERMEDIATE 45%5.7 Trillion Bbls

(3,500 – 10,000 Ft)

SHALLOW 34%4.4 Trillion Bbls

(<3,500 Ft)

TOTAL 12.8 Trillion BarrelsTOTAL 12.8 Trillion Barrels

Sandrea, Oil & Gas Journal (Nov 2007)


Distribution of Global Oil Reserves by DepthDistribution of Global Oil Reserves by Depth

Shallow(<3,500 ft)

Intermediate(3,500 – 10,000 ft)

Deep(>10,000 ft)

163

663

321

1,147

14

58

28

100

293

--

--

293

100

--

--

100

Remaining Reserves (1P), 2006

Billion Bbls of Oil % Billion Bbls of Oil %

Conventional Non-Conventional

HIS, Credit Suisse


EOR vs. ViscosityEOR vs. Viscosity

HydrocarbonMiscible


CO2


Polymer

Alkaline

Fireflood

Steam Drive

EOR MethodOil Viscosity (centipoise at reservoir conditions)

1.0 100 10,000 1,000,000




Gravity Distribution of World’s OilGravity Distribution of World’s Oil

LIGHT 22%2.8 Trillion Bbls (>35° gravity)

MEDIUM 44%5.6 Trillion Bbls (26-35° gravity)

HEAVY 1%1.4 Trillion Bbls (<26° gravity)

EXTRAHEAVY 23%

3.0 Trillion Bbls (<10° gravity)

TOTAL 12.8 Trillion BarrelsTOTAL 12.8 Trillion Barrels

Sandrea, Oil & Gas Journal (Nov. 2007)


EOR vs. PermeabilityEOR vs. Permeability

HydrocarbonMiscible


CO2


Polymer

Alkaline

Fireflood

Steam Drive

EOR Method

Not critical if uniform

Not critical if uniform

High enough for good injection

Permeability (md)10 100 1,000


100,000



Chemical EOR ProcessesChemical EOR Processes

Process

Typical UltimateRecovery(%OOIP)

Typical AgentUtilization

Polymer 5 1 lb polymer /Incremental bbl

Micellar / Polymer 15 10-25 lb surfactant /Incremental bbl

Alkaline / Polymer 5 35-45 lb surfactant /Incremental bbl


Gas (Miscible and Immiscible)Gas (Miscible and Immiscible)

Process


AgentUtilization

Miscible 10 - 15 10 MCF /Incremental bbl

Immiscible 5 - 10 10 MCF /Incremental bbl


Thermal Recovery ProcessesThermal Recovery Processes

Process


AgentUtilization

Steam(drive and soak)

50 - 65 0.5 bbl /Net Incremental bbl

Combustion 10 - 15 10 MCF air /Incremental bbl


EE.UU EOR Production, 2000EE.UU EOR Production, 2000

800

Year

Pro

duct

ion

(M B

BLS

/Day

)

1984 1986 1988 1990 1992 1994 1996 1998 2000

Nitrogen Injection

600

400

200

0

HC Gas Injection

CO2 Injection

Thermal

Chemical

Flue Gas Injection

Moritis, Oil & Gas Journal (2000)


EE.UU EOR Production, 2008EE.UU EOR Production, 2008

19860

Prod

uctio

n (M

B/D

)

1990 1994 1998 2002 2006

200

400

600

800

TOTAL

Thermal

Gas

Chemical



Est. Worldwide EOR Production, 1990 (M Barrels / Day)

Est. Worldwide EOR Production, 1990 (M Barrels / Day)

Country Thermal Miscible Chemical EOR Total %

USA 454 191 11.9 656.9 42

Canada 8 127 17.2 152.2 10

Europe 14 3 - - 17.0 1

Venezuela 108 11 - - 119.0 7

Other S.A. 2 NA NA 17.0 1

USSR 20 90 50.0 160.0 10

Other (est’d.) 171* 280** 1.5 452.5 29

Total 777 702 80.6 1,574.6 100

SOURCE: Oil & Gas Journal (1990) * Mainly Indonesia** Mainly Algeria and Libya


Est. Worldwide EOR Production, 2007

Est. Worldwide EOR Production, 2007

USA649,300 B/D30%

Mexico500,000 B/D

22%

Venezuela365,600 B/D

16%

Canada325,500 B/D14%

Indonesia220,000 B/D10%

China166,900 B/D

7%

Other17,800 B/D

22%

Percentages are those of total EOR production of 2.5 MM B/DThomas (2008)


Canada EOR, 2006Canada EOR, 2006

Acid Gas

CO2

Combustion

Hydrocarbon (Natural Gas)

Steam

Nitrogen

1

3 4

21

10

3

2

1

2

Oil & Gas Journal (April 2006)


EE.UU EOR, 2006EE.UU EOR, 2006

Steam

Water

Combustion

CO2

Gas

Alaska

5 3

391

392

1 114

15

50

1

3

6

1 1

2

2 1

11



Central and South America EOR, 2006

Central and South America EOR, 2006

CO2

Hydrocarbon

Steam

Nitrogen

238

8

3

5

1



Rest of World EOR, 2006Rest of World EOR, 2006

y

a

CO2

Combustion

Steam

Microbial

Polymer

1

15

2

1 17 2 19



Summary of Active EOR Projects, 2006

Summary of Active EOR Projects, 2006

Steam

CO2

HC Gases

Combustion

Polymer

Nitrogen

Type

119

94

38

21

20

5

Number ofProjects

76 – 220,000

100 – 35,000

10 – 80,000

100 – 8,100

53 – 4,900

1,000 – 500,000

Production(Bbls/Day)

350 – 5,740

1,900 – 10,900

4,040 – 14,500

1,640 – 9,500

1,063 – 4,626

4,600 – 15,400

Depth(Feet)

8 – 26

19 – 43

15 – 45

18 – 38

21 – 34

16 - 51

API Gravity( ° )

OGJ Worldwide EOR Survey, 2006


Major EOR Projects and ProductionMajor EOR Projects and Production

USA

Prod

uctio

n (M

B/D

)

100

300

500

700

0

Mexico Canada Venezuela Indonesia China

TotalThermalGasChemical



Comparison of EOR TechniquesComparison of EOR Techniques

60

50

40

30

20

10

00 10 20 30 40 50 60 70 80

Total Recovery (% OOIP)

Incr

emen

tal O

il C

ost

($/B

BL)

Surfactant

Thermal

CO2 Injection

Polymer

MEORWaterflood

Simandoux et al. IFT Journal (1990)


2006 Global EOR Average Costs2006 Global EOR Average Costs

15

13

11

9

7

5

3

1

Exploration &Development

US

$ / B

arre

l

Acquisitions CapexDeep Water

CapexHeavy Oil

CapexEOR

Sandrea, Oil & Gas Journal (Nov. 2007)


Reasons for EOR FailuresReasons for EOR Failures

• Low Oil Prices- oil price instability

• Insufficient description of Reservoir Geology- Underestimated Reservoir Heterogeneity

• Inadequate understanding of EOR mechanism- Bad Candidate Selection

• Unavailability of Chemicals in large quantities- Insufficient Budget (lack of commitment)

• Heavy reliance on lab experiments- And too much reliance on simulation

• Poor post treatment evaluation

Comments in white from S.M. Farouq Ali (2007)


Ideal Enhanced Oil Recovery (EOR)Ideal Enhanced Oil Recovery (EOR)

DriveWater

CO2

Water

CO2

MiscibleZone

Oil Bank

Add’l OilRecovery

Carbon Dioxide InjectionWell

Produced Fluids(oi, gas, water)Separation and Storage Facilities

Water InjectionPump

ProductionWell


Real World EORReal World EOR

Carbon Dioxide InjectionWell

Produced Fluids(oi, gas, water)Separation and Storage Facilities

Water InjectionPump

ProductionWell


How to Convert EOR to IRR (TIR)How to Convert EOR to IRR (TIR)

1) Consider reservoir heterogeneity

2) Predicting results is difficult

3) The more you inject, the more you get

1) Single well pilots usually not successful

4) Detailed Evaluation is essential

5) EOR is not a panacea, but will play an increasingly important role in the future

1) 70% of current oil production from mature fields

Enhance Oil Recovery

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