Selection of optimal parameters of oil field development

Authors: M.M. Khasanov, O.S. Ushmaev (Gazpromneft NTC LLC, RF, Saint-Petersburg), S.A. Nekhaev, D.M. Karamutdinova

Key words: field development optimization, well spacing, production rate.

This paper describes a new method for selection of well spacing and production rate for an oil field. We express net present value as function of well spacing and the production rate. Then we introduce dimensionless parameters that describe optimal well spacing and production rate. Analysis of optimal development parameters shows the effect of the discount rate on the parameters of development. We reveal that overestimation of discounting factor potentially leads to incorrect technical decisions. We illustrate an application of our method with examples of Western Siberia and Yamal oil fields.

1. Roberts T., Economics of well spacing, SPE 240, 1961.

2. Matheron G., Osnovy prikladnoy geostatistiki (Principles of geostatistics), Moscow: Mir Publ., 1968.

3. Lohrenz J., Burzlaff B.H., Elmer L.D., How policies affect rates of recovery from mineral sources, SPE 9553, 1981.

4. Nystad A.N., Reservoir economic optimization, SPE 13775, 1985.

5. Bobar A.R., Reservoir engineering concepts on well spacing, SPE 15338, 1985.

6. Hayhow I.G., Lemee J.A., Reserves to production ratios and present value relationships, SPE 59783, 2000.

7. Laughton D.G., Modern asset pricing and project evaluation in the energy industry, The Journal of Energy Literature, 2000, 6-1.

8. Corrie R.D., An analytical solution to estimate the optimum number of development wells to achieve maximum economical return, SPE 71431, 2001.

9. Vol'gemut E.A., Kornienko O.A., Mirzoev D.A., Nikitin P.P., Neftegazovoe delo, 2007.

10. John U.M., Onyekonwu M.O., Non-linear programming for well spacing optimisation of oil reservoirs, SPE 140674, 2010.

11. Khasanov M., Ushmaev O., Nekhaev S., Karamutdinova D., The optimal parameters for oil field development, SPE 162089, 2012.

12. Arps J.J., Analysis of decline curves, Trans. AIME: 160, 228-247, 1945.

Key words: field development optimization, well spacing, production rate.

This paper describes a new method for selection of well spacing and production rate for an oil field. We express net present value as function of well spacing and the production rate. Then we introduce dimensionless parameters that describe optimal well spacing and production rate. Analysis of optimal development parameters shows the effect of the discount rate on the parameters of development. We reveal that overestimation of discounting factor potentially leads to incorrect technical decisions. We illustrate an application of our method with examples of Western Siberia and Yamal oil fields.

1. Roberts T., Economics of well spacing, SPE 240, 1961.

2. Matheron G., Osnovy prikladnoy geostatistiki (Principles of geostatistics), Moscow: Mir Publ., 1968.

3. Lohrenz J., Burzlaff B.H., Elmer L.D., How policies affect rates of recovery from mineral sources, SPE 9553, 1981.

4. Nystad A.N., Reservoir economic optimization, SPE 13775, 1985.

5. Bobar A.R., Reservoir engineering concepts on well spacing, SPE 15338, 1985.

6. Hayhow I.G., Lemee J.A., Reserves to production ratios and present value relationships, SPE 59783, 2000.

7. Laughton D.G., Modern asset pricing and project evaluation in the energy industry, The Journal of Energy Literature, 2000, 6-1.

8. Corrie R.D., An analytical solution to estimate the optimum number of development wells to achieve maximum economical return, SPE 71431, 2001.

9. Vol'gemut E.A., Kornienko O.A., Mirzoev D.A., Nikitin P.P., Neftegazovoe delo, 2007.

10. John U.M., Onyekonwu M.O., Non-linear programming for well spacing optimisation of oil reservoirs, SPE 140674, 2010.

11. Khasanov M., Ushmaev O., Nekhaev S., Karamutdinova D., The optimal parameters for oil field development, SPE 162089, 2012.

12. Arps J.J., Analysis of decline curves, Trans. AIME: 160, 228-247, 1945.


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