Chapter 1
Introduction
Abstract
Only recently it has become evident that natural gas provides one with great value with minimum impact on the environment. With the ongoing “gas crisis” in Europe and steep energy needs of China and India, the importance of natural gas is increasing tremendously in the global market. Unconventional gas reservoirs are responsible for about one-third of annual US natural gas production. In the global scale, unconventional gas reserves can add 60–250% to the proven gas reserves. This book explores the science behind unconventional gas and provides one with a basis that the realistic estimate of total available gas could easily exceed all estimates of the past. With newfound gas and technologies that harness it with environmental integrity, the world could easily see another 100 years of crisis-free energy outlook. This book paints a rosy picture that is supported by scientific basis and guides the readership to be able to discern between hype and hysteria involving petroleum resource management.
Keywords
Energy crisis; enhanced oil and gas recovery; non-Newtonian; reserve analysis; reservoir characterization; tight gas1.1. Summary
Only recently it has become evident that natural gas provides one with great value with minimum impact on the environment. With the ongoing “gas crisis” in Europe and steep energy needs of China and India, the importance of natural gas is increasing tremendously in the global market. Unconventional gas reservoirs are responsible for about one-third of annual US natural gas production. In the global scale, unconventional gas reserves can add 60–250% to the proven gas reserves. This book explores the science behind unconventional gas and provides one with a basis that the realistic estimate of total available gas could easily exceed all estimates of the past. With newfound gas and technologies that harness it with environmental integrity, the world could easily see another 100 years of crisis-free energy outlook. This book paints a rosy picture that is supported by scientific basis and guides the readership to be able to discern between hype and hysteria involving petroleum resource management.
The potential of unconventional gas reserves is far greater than any enhanced oil recovery scheme designed to date. However, when the two are combined and added to that is scientific basis for revised assessment of world gas reserve, the energy outlook becomes very bright. The purpose of this book is to provide one with practical insights and tools that can be used to efficiently identify, appraise, and develop these types of reservoirs. Initially, the readership is be familiarized with both engineering and marketing aspects of natural gas. The mechanisms of gas production and reservoir engineering are discussed. Presented are the origin and mechanisms of gas production, along with the various techniques used to analyze reservoir parameters and performance, and understand how these have been applied to numerous projects. Specific features of unconventional gas reserves and the means of capitalizing on these features in order to maximize long-term benefit are discussed. Scientific characterization of gas reserves included discussion of the history of gas as well as the rock. This “bottom-up” analysis helped develop truly scientific basis for unconventional gas analysis. Thorough geological characterization was presented for US reservoirs in order to connect with potential sources of unconventional gas. This serves as a template for a new analysis that starts off with conventional reservoir characterization. It is shown that the true reserve potential of gas is much higher than the one estimated using conventional approach. Latest information on emerging technologies in typical enhanced oil recovery are presented with lucid discussion of key features of reservoir characterization and development in order to help readership identify techniques that can be used in “enhanced gas recovery” of unconventional gas. It is shown that contrary to popular belief, such techniques are economically attractive and environmentally sustainable. This unlocking of emerging technologies, coupled with a novel technique for characterization of unconventional gas reserves for which conventional techniques fail to yield sound results, creates a true paradigm shift in gas reservoir analysis.
The science of both fluid and rock is discussed using delinearized history analysis. The discussion of coal bed methane and gas hydrate is carried out with the focus on improving production rate under various production strategies. Criteria for selecting candidates for hydraulic fracturing as well as horizontal wells are discussed. For every case encountered specific suggestion is made that is custom designed for the particular application. A guideline is provided for optimization of recovery schemes under various production and enhanced gas recovery strategies.
Finally, numerical modeling approaches are discussed and challenges in modeling unconventional gas reservoirs are presented. A number of case studies involving technological application as well as numerical modeling are presented. Overall, new opportunities are highlighted and previously held beliefs and myths deconstructed.
1.2. Unconventional to Mainstream: A Necessary Paradigm Shift
Newton did not know what the term “Newtonian” meant in any discipline. Scientists that followed Newton's “laws” and theories with dogmatic fervor did not know what the term non-Newtonian stood for. At present, scholarly works on “Non-Newtonian” outnumber “Newtonian” by a big margin. Over 50 years ago, US government started to invest in research in coal bed methane, shale gas, shale oil, along with other areas of petroleum development. Decades later, the term “unconventional” was coined. Even some more decades later came the success story of unconventional gas. This success would come only after Europe had been under the grip of a “gas crisis.” Within years, “unconventional” became the biggest story in U.S. in terms of energy independence. A new type of revolution began. Figure 1.1 shows graphical representation of wells in the shale gas plays of just one basin in Texas. If 10,860 horizontal gas wells are called “unconventional” one must wonder what would the term “conventional” represent.
Figure 1.1 Location map for Barnett shale. From EIA, 2011.
Chapter 2 discusses the role of unconventional gas in the big picture of petroleum. It deconstructs many myths that have perplexed modern society that has grown accustomed to vilifying carbon—the essence of life. It unravels the mysteries of “resource triangle” that is based on the false premise that natural is more expensive than artificial (Figure 1.2). It places unconventional gas in its correct position within proven gas and oil reserves and shows that this “unconventional” is anything but unconventional in conventional sense. It is the mainstream of the future.
The chapter also presents a delinearized history of energy developments in relation to petroleum production, particularly as it relates to natural gas. It shows that energy needs of the future can only be met if we excel in accessing unconventional gas. It creates the need for a paradigm shift in nomenclature as well as scientific description of unconventional reservoirs. In simple terms, it delivers the message that the science of unconventional gas cannot be understood with the conventional routines.
Figure 1.2 Conventional perception of resource triangle.
1.3. The Paradox of Unconventional Gas
We live in an interesting époque. Everything surrounding us seems to point to contradictions. We made unprecedented progress in technology development, only to hear from Nobel Laureate Chemists (e.g., Robert Curl) that ours is a “technological disaster.” We claim to have progressed from dark ages of savagery and lack of empathy to modern enlightenment only to hear from some of the most ardent supporters of modern European mind-set of Capitalism (e.g., Pope Francis) that unfair economic structures that creates huge inequalities are actually an act of terrorism. As civilization evolved, we claim to have become wiser and more efficient, only to discover our per capita energy need has skyrocketed in the modern era. We are so sure about our superiority that we call humans as the top of the food chain and boast about our entitlement over other species, only to discover that the greatest crisis is the population growth of humans—the “best creation” of nature. We have identified “greening” as the key to resolving the environmental disaster that has befallen on us only to target carbon as the worst enemy to environmental integrity. This is the same carbon that is the essence of “greening.” We praise nature for its unique ability to turn bad into good, for its tenacity and sustainability, only to target petroleum as the number one enemy of the environment. Which petroleum? The one that was perfected by nature—the very nature we love to be in tune with.
Chapter 2 started the paradigm shift and Chapter 3 continues it in the realm of unconventional technology development, its geological nature, and the economics that can support its development and growth. It shows conventional engineering analysis is not the only one that does not apply to unconventional reservoirs; conventional accounting theories as well as energy pricing models do not apply also. It shows with details why essential features of unconventional gas are such that none of the conventional techniques and principles should apply. This ranges from geology to chemistry to engineering for coal bed methane, shale gas, tight gas as well as methane gas hydrate.
1.4. Greening the Future of Unconventional Gas
Humans seek status quo. Somehow, we have great difficulty in changing our style of analysis. It starts with our inability to change the first premise. Today's first premise in energy sectors seems to be based on the misconception that global warming is because of petroleum production. This may be illogical coming from fallacious arguments, but the moment it becomes a political issue, humanity loses its ability to think from outside the box.
Even at the pinnacle of unconventional gas recovery, we have managed to use only hydraulic fracturing and horizontal wells as the only technological tool to produce gas. Talks are all abound how to increase the resource base, where to drill new wells, how to fracture more wells, how to penetrate more difficult-to-access formations, but few talk about using numerous other technologies that are readily available today. Chapter 4 introduces a section “Lessons learned from Enhanced Oil Recovery” (EOR) and summarizes success stories of last 50 years of EOR. Why learn from EOR? It is because they are much easier to apply in gas reservoirs, particularly the ones that contain huge amount of gas in shallower formations.
The chapter demystifies the global warming debate and shows that natural gas is the most environmentally appealing energy source known today. Then, it shows how the unconventional resource base can be expanded multifold by adopting EOR technologies that have been perfected by the same petroleum sector that produces unconventional gas. These do not need any research investment for future development. They only need careful custom designing for a particular application.
Added to the equation is the tremendous resource locked in methane gas hydrates. Techniques capable of unlocking these formations are discussed.
The concept of using novel techniques for enhanced gas recovery is introduced. This would add to the current estimates of unconventional reserves. Discussion is carried out on reservoirs that are not commonly characterized as “unconventional,” such as volcanic reservoirs.
1.5. Paradigm Shift in Reservoir Characterization
Recent years have brought a rapid expansion of activities around unconventional gas. The successes in unconventional gas exploitation have been mainly attributed to advances in engineering. In particular, hydraulic fracturing and horizontal wells are considered to be the game changer. To date, geophysics and geology have yet to assume a major role in the development of this important resource.
Islam et al. (2012) recently argued any “game changer” must accompany real change, which means change from the first premise to the process itself. If previous chapters established that unconventional gas reservoirs are indeed uniquely different from conventional ones, why should we assume the reservoir characterization tools and procedures of conventional reservoirs would apply to unconventional ones?
Chapter 5 introduces a new reservoir characterization technique that uses paradigm shift in its real sense. The outcome is a refreshing new approach that is practical and prepares one for in-depth understanding of the mechanisms involved in unconventional gas reservoirs. The technique relies heavily on whatever is available during the course of the reservoir development and minimizes spending on expensive tools that have little validity in unconventional reservoirs. At the end the chapter introduces a screening tool to identify different types of formations so that development strategies can be chalked out.
1.6. The Science of Unconventional Gas
Albert Einstein famously said, “Any intelligent fool can make things bigger, more complex, and more violent. It takes a touch of genius—and a lot of courage—to move in the opposite direction.” Sadly, this touch of genius is missing from the New Science. The contradictions pointed out in earlier sections would not occur if we did not invoke assumptions that are so complex that no one dares question their absurdity. Chapter 6 takes a dogma-free approach and eliminates all spurious assumptions in mass and energy balance equations. The results are refreshing. A new theory emerges that can explain all the events, ranging from global warming to light pollution, from digenesis to formation of gas traps. With this description a fundamental change in reservoir analysis is invoked.
Figure 1.3 Conventional approach involves delineating unconventional proved reserve first, following by emerging and speculative zones.
Previous techniques included reservoir characterization based on production or data of the present. Even in exploration, unconventional gas reservoirs are first identified and “proved,” followed by the search of additional resources that are marked as “emerging” and “speculative” (Figure 1.3). This defies the logic that all unconventional gas emerges from conventional sources. The new technique reversed that and introduced reservoir characterization based on geology first. Based on this technique, all US oil and gas fields are characterized based on origin, then migration of the fluid. This results in a truly scientific characterization of unconventional resources. Consider the significance when applied on worldwide reserves (Figure 1.4).
1.7. Depicting the Future
Even though not commonly perceived, modeling comes before execution of any engineering project. The petroleum engineering industry is a champion of modeling. Today, it has the ability to model a reservoir with no less than trillion cells and solve the governing equation within minutes. Only a decade ago, such performance was unthinkable even from the super computers. The problem is not with the speed or the ability to model billions of grid blocks. The problem is not in collecting data and processing them. In fact, Saudi Arabia has set up massive 4D seismic in reservoirs that do not even employ waterflooding. The problem lies within the fact that none of the unconventional reservoirs follow Darcy's law—the only equation petroleum engineers have used in last 155 years. Chapter 7 shows how people tried to cope with this crisis and presents a way out, with practical advice on how to model unconventional reservoirs.
Figure 1.4 The locations of current proven reserves.
1.8. The End Game
Chapter 8 presents the economics of unconventional gas reservoirs. By knowing that economics is the driver of any engineering project, the chapter introduces fundamental changes in economic analysis and uses that to consolidate the conclusions that emerge from previous chapters.
Bibliography lists some 60 pages of references and bibliography that serve as a documentary evidence of the usefulness of and interest in the topic covered in this book.
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