Building on Drillinginfo posts about Enhanced Oil Recovery (EOR) earlier this year in these times of low commodity prices, I wanted to touch on the subject of EOR affordability and access for the operators who manage the hundreds of thousands of underappreciated stripper wells across the US.
The National Stripper Well Association (NWSA) states that there are an estimated 771,000 marginal wells in production. Combined they make up 11.3% of the US oil production and 8.3% of the US gas production. These wells are described as marginal because they are marginally economic to produce. The NWSA website states that in that last 10 years, over 131,000 of these oil wells and 48,000 gas wells have been plugged and abandoned. Many of these wells are plugged without ever having undergone waterfloods or tertiary production so they are being abandoned with a significant % of the original oil still in place.
With the recent drastic reduction in oil prices, some operators of these marginal wells are laying off, cutting back and shutting in wells in an attempt to just break even, while others are doing the bare minimum to maintain mineral rights. Few of them are focused on technologies which can economically extend the lives of their fields because to date, the cost of stepping up to field-wide water, CO2 or nitrogen floods is too cost prohibitive. Other than periodic mini-fracs, hot oiling or paraffin treatments, not much is done to these wells to increase production rates. The day-to-day focus is on reducing repair and maintenance expenses.
The Three P’s
When you look at shallow stripper wells, what is holding them back from continued profitability is primarily what I call the three P’s – Pressure, Permeability, and Paraffin. As these fields are produced, the wells undergo severe pressure depletion and a corresponding reduction in production rates. With the amount of thermal energy entering the wellbore drops with production rates. Wells get to the point where oil crosses its cloud point threshold and paraffin crystals start to precipitate when the oil moves from the pore space to the open wellbore. If a well’s flow rate is high enough, the continued thermal mass of the oil entering the wellbore can keep the paraffin in solution so that the buildup on the wellbore walls is minimal. As flow rates decrease, the paraffin will create thick deposits in the wellbore which further inhibits the flow of oil. Figure 1 below illustrates how thick some of the paraffin deposits can be.
What can operators do to try to mitigate the paraffin and pressure issues? Many of them resort to mini-fracs which temporarily exposes virgin rock and increases the effective permeability of the surrounding rock. These mini-fracs enhance production rates for a time, but eventually, the frac’d intervals fill with paraffin and actually become flow barriers. Operators will also resort to pouring barrels of harsh, paraffin solvents downhole like xylene, mineral spirits. Some will try paraffin-eating bacteria into their wellbores in an effort to clean them up. The problem with these liquid treatments is that either the liquid drops to the bottom of the well and only treats the bottom-most zone or you have to use enough treatment liquid to create a column of fluid which covers the entire productive interval. The result is either a treatment that is ineffective or cost prohibitive. Hot oiling is another technique that is used to clean these wells but it again doesn’t address the root of the problem which is that the oil is crossing the pressure and temperature threshold required to keep it above its cloud point. What permeability that you have in these wells is of little benefit if the near wellbore is coated with a thick layer of wax with little pressure behind it to push the oil into the wellbore for collection.
Originally posted at Forbes.com – January 6, 2016