Quick project evaluations

Introduction

A license area is proposed for consideration, where a new 3D seismic survey has identified an anticline structure at deep horizons. Although there are no drilled wells within the license, the region itself is a mature basin with a significant number of well-known oil and gas fields.

The partner company is offering to participate in the project and has provided a package of initial data for review. According to their estimates, recoverable oil resources reach 4.8 million tons, with an exploration success coefficient (COS) of 0.32. Their claimed NPV of the project, under current economic conditions, is around 150 million USD.

Therefore, a prompt assessment and verification of the provided data and reported indicators is required. However, the time for evaluation and decision-making is limited and does not exceed 5 working days.

Evaluation of Resources and Risk

First, the gross rock volume (its probabilistic distribution) is calculated based on the structural map and the estimated depth range of the oil-water contact.

Quick-look analysis have been conducted on the regional patterns of reservoir property variations as well as for fluid properties. It was mostly based on the analog field knowledge.

Next, based on the provided data, the probabilistic ranges of reservoir and fluid properties are input into the program. The distributions of specific properties, such as porosity and saturation, are selected from the region's statistical libraries available in the Geonomix program, which significantly reduces analysis time. Risk parameters are determined based on expert assessments and general knowledge of the region that was aided by the formal guidelines for the specific factors.

As a final result of the calculation, a probabilistic distribution of oil resources and an exploration success factor (COS) have been obtained for the analyzed structure. The probabilistic range of recoverable resources (P90-P50-P10) corresponds to categories (1U-2U-3U) as defined by the PRMS system.

Production forecast

The express assessment of oil production forecasts was based on analog wells from geologically similar fields in the region. Production history data for these wells were uploaded to the Geonomix program, where a probabilistic production model for the so-called type well was developed. To generate this model, we conducted a probabilistic variation of parameters such as the initial flow rate, the duration of the stable period (plato), and the rate of decline in production. The model defines a probabilistic range of EUR (Estimated Ultimate Recovery) for the type well.

We refer to this method as probabilistic decline curve analysis.

The next step was to define the required number of wells for field development. This was calculated using the volumes of recoverable resources (obtained in the previous step) and the type-well model. As a result, a probabilistic range for the number of production wells was estimated, which is considered a tentative development plan for the field.

Finally, a full probabilistic range of production forecasts was calculated for the prospect. It is important to note that the probabilistic volumes of cumulative production for the P90, P50, and P10 categories closely correspond to the recoverable volumes obtained in the previous step using volumetric methods. This alignment is due to the resolution of the controversy surrounding the matching of probabilistic volume categories with probabilistic production forecasts in Geonomix.

The range of probabilistic cases (2,000 realizations) of production forecasts, along with their corresponding production drilling schedules, is sent for economic evaluation. Among these, three probabilistic categories include the following:

Economic evaluation

A preliminary plan for project development was created, which outlines the commencement of commercial production in the sixth year. Two exploration wells will be drilled during the Exploration/Appraisal phase of the project.

Project parameters

The key parameters for the economic evaluation include variable factors such as prices, rates, and costs, which are summarized in the table below.

A conservative scenario is used for the oil price, starting at $60 per barrel and adjusted for inflation in subsequent years. The largest cost for the project is the construction of new field facilities.

It is assumed that the risk capital includes drilling the initial exploration well.

The calculated economic factors are summarized in the results diagram below (taken directly from Geonomix).

Conclusion

The integrated probabilistic assessment has enabled the estimation of key project parameters, such as recoverable oil, production volumes, and economic factors, which are summarized in the table. It is clear that the project is feasible and commercially viable under the assumed conditions, although the calculated parameters are lower than those presented by the partner.

The entire exercise took only four days: three days for data preparation and analysis, and one day to tune and calculate the models in Geonomix. The results obtained provide a reasonable basis for the company to make an informed decision.