Technical, economic and risk analysis for a multilateral well
Conference Paper
Overview
Research
Identity
Additional Document Info
View All
Overview
abstract
Multilateral well technology is considered a development strategy as the oil and gas industry is increasingly approaching more hostile environments. It remains attractive to maintain efficient exploration of oil and gas fields in order to maximize profitability with minimum uncertainty. Some of the non-conventional oil and gas reservoirs currently being drilled are characterized by significant heterogeneity, tight and naturally fractured, faulted/compartmentalized, heavy oil and, depleted reservoirs/mature development. However, sometimes the high risk involved accompanied by economic disadvantages have diminished the ability of multilateral wells to maximize access to reserves without incurring higher development costs. The objective of this study is to develop a methodology to assist engineers in their decision making process of maximizing access to reserves. The process encompasses technical, economic and risk analysis of various alternatives in the completion of a well (vertical, horizontal or multilateral) by using a well performance model for technical evaluation, and a deterministic analysis for economic and risk assessment. In the technical part of the decision making process, the flow rate for a defined reservoir is estimated by using a pseudo-steady state flow regime assumption. The economic analysis departs from the utilization of that flow rate data assuming certain pressure decline. Financial Cash Flows (FCF) are generated to measure the economic worth of investment proposals. Net Present Value (NPV), Internal Rate of Return, Profitability Index and payback period are the main economic yardsticks used in the analysis. Last, a deterministic decision tree is used to represent the risks inherent in geological uncertainty, reservoir engineering, drilling, and completion for a particular well. The NPV generated from the economic analysis is used as the base economic indicator. In addition, the risk associated at each stage of the project is considered with an assigned probability. By selecting a type of well that maximizes the expected monetary value (EMV) in a decision tree, we can make the best decision based on a thorough understanding of the prospect. The method introduced in the paper emphasizes the importance of a multi-discipline concept in drilling, completion and production technology. The examples presented in the paper will assist geologists, geoscientists, engineers, and managers in collaborating together in a development project. Copyright 2008, Society of Petroleum Engineers.
