1. Cardinal Surveys Company 2009 Steve McLaughlin President Cardinal Surveys Company

2. Cardinal Surveys Company 2009

3. You do not want to frac your injectors Old technology, but must be done right Scant literature, but agrees on fundamentals Most costly waterflood mistake: Unintentional Fracturing and direct channels Most overlooked, underutilized technology Rapid, premature breakthrough still plagues new floods today State and Federal regulations dictate, provide some guidance

4. Cardinal Surveys Company 2009 Goal: Reliable estimate of FPP (Formation Parting Pressure) Injection above FPP: Premature breakthrough of injected fluids Poor sweep efficiency Reduced recovery Loss of costly injection fluids. Injection far below FPP: Injection volumes much lower than the allowable maximum Reduced rate of oil recover.

5. Cardinal Surveys Company 2009 “A reliable estimate of the formation parting or fracture extension pressure is important for efficient operation of water floods and tertiary recovery projects.” - Pramod Singh, SPE, and Ram G. Agarwal, SPE, Amoco Production Co. SPE 18141, 1990.

6. Cardinal Surveys Company 2009 “Rapid water breakthrough in production wells as a direct result of exceeding a certain critical injection pressure in nearby injection wells was observed as early as 1945.(1) This critical injection pressure is called the formation or fracture parting pressure (FPP). The FPP is equivalent to the ‘fracture extension/propagation pressure’ in the hydraulic fracturing literature.(2) Several studies (3-5) recently demonstrated that a fracture will propagate if injection is above the FPP and the injection/withdrawal ratio is greater than one. In addition to this uncontrolled fracture extension, injection above the FPP may also cause fracturing out of pay. These factors may lead to premature breakthrough of injected fluids, poor sweep efficiency, reduced recovery, and loss of costly injection fluids. “ Cont.

7. Cardinal Surveys Company 2009 “On the other hand, injection far below the FPP may result in injection volumes much lower than the allowable maximum and a reduced rate of oil recover. A reliable estimate of the FPP is therefore critical in conducting secondary and tertiary recovery projects.(6)” - Pramod Singh, SPE, and Ram G. Agarwal, SPE, Amoco Production Co. SPE 18141, 1990.

8. Cardinal Surveys Company 2009 What is a “Step Rate Test (SRT)?” A series of constant-rate injections (“Steps”) increasing from low to high, designed to determine the Formation Parting Pressure (FPP). Formation Parting Pressure is the pressure which will initiate formation fracture. Fracture is undesirable when it leads to by-passing productive pay and channeling directly to adjacent producers.

9. Cardinal Surveys Company 2009 FPP vs. closure pressure: Closure pressure is less than the Formation Parting Pressure. Closure pressure can be determined by in-situ stress testing methods. Rules of Thumb usually limit injection pressure to about 80% of FPP which should also be below closure pressure.

10. Cardinal Surveys Company 2009 Eaton’s Method, 1969 FG = Fracture Gradient Pob = Overburden Gradient Pr = Reservoir Pressure Gradient E = Poisson’s Ratio

11. Cardinal Surveys Company 2009 Eaton’s Method – West Texas Example Pob = 1 PSI/ft (overburden gradient) Pr = 0.433 PSI/ft (fresh water reservoir gradient) E = 0.25 (Poisson’s ratio) FG = 0.622 PSI/ft 4,500’ well = 2,799 PSI FPP

12. Cardinal Surveys Company 2009 Note: Eaton’s Method from example using 80% rule-of-thumb equals 0.5 psi/ft gradient: 0.622 X 0.80 = 0.5 psi/ft This is the Texas Railroad Commission default permitted value.

13. Cardinal Surveys Company 2009 Measuring pressure – Down Hole or Surface? Theoretically, pressure can be measured at the surface, and corrected for hydrostatic and frictional factors. Practically, only down-hole (near formation face) placed measurements yield good SRT data. Real-time monitoring required to insure quality of the SRT, and to insure FPP has been reached.

14. Cardinal Surveys Company 2009 Real – Time Injection Rate Steps

15. Cardinal Surveys Company 2009 Real – Time Bottom Hole Pressures

16. Cardinal Surveys Company 2009 Injection Rates vs. BHP

17. Cardinal Surveys Company 2009

19. New Mexico OCD (Oil Conservation Division) UNDERGROUND INJECTION CONTROL PROGRAM MANUAL February 26, 2004

20. Cardinal Surveys Company 2009 New Mexico OCD rules: Injection Pressure: The initial permitted injection pressure is limited to 0.2 psi/ft. Wells may be permitted at a higher initial injection pressure at the time of application if adequate step-rate test information is provided to the Division

21. Cardinal Surveys Company 2009 New Mexico OCD rules: Pressure Increases (over 0.2 PSI/ft): The Division may authorize an increase in injection pressure upon a proper showing by the operator that such higher pressure will not fracture the formation and will not result in migration of injected fluids from the authorized injection zone. Such proper showing shall consist at least of a valid step-rate test run in a manner acceptable to the Division

22. Cardinal Surveys Company 2009 Texas RRC Statewide Rule 46 To ammend Injection Pressure above 0.5 PSI/ft, a Step Rate Test is required.

23. Cardinal Surveys Company 2009 Step Rate Test Guidelines – Texas RRC Must demonstrate that formation fracturing will not occur at the proposed injection pressure. SRT used to demonstrate. Measure both surface and BHP. The test well should be shut in long enough so that the bottom-hole pressure is near the shut- in formation pressure (No less than 48 hours.).

24. Cardinal Surveys Company 2009 Step Rate Test Guidelines – Texas RRC The well may need to be backflowed if the shut- in pressure is above the expected fracture pressure of 0.5 psi/ft. of depth. Suggested rates for the test are 5, 10, 20, 40, 60, 80, and 100% of the proposed maximum daily injection volume and corresponding pressures. The first rate should be the formation matrix rate (the rate at which the formation begins to accept fluid).

25. Cardinal Surveys Company 2009 Step Rate Test Guidelines – Texas RRC At least two rates must be below the expected fracture pressure of 0.5 psi/ft. of depth. Each rate must be allowed to stabilize before proceeding to the next higher rate. (60 min for formation permeability 10 millidarcies.)

26. Cardinal Surveys Company 2009 Step Rate Test Guidelines – Texas RRC EACH STEP SHOULD LAST EXACTLY AS LONG AS THE PRECEDING STEP. Once the fracture pressure is reached, continuing the test by stepping downward will refine the fracture pressure and provide quality control for the test. http://www.rrc.state.tx.us/forms/publications/HTML/fsrt.php

27. Cardinal Surveys Company 2009 United States Evironmental Projection Agency (EPA) Underground Injection Control regulations promulgated in response to requirements of the Safe Drinking Water Act include 40 CFR 146.13(a) for non- hazardous waste wells and 146.67(a) for hazardous waste wells, which state that: Except during stimulation, the owner or operator shall assure that injection pressure at the wellhead does not exceed a maximum which shall be calculated so as to assure that the pressure in the injection zone during injection does not initiate new fractures or propagate existing fractures in the injection zone. http://www.epa.gov/R5water/uic/r5guid/r5_07.htm

28. Cardinal Surveys Company 2009 United States Evironmental Projection Agency (EPA) Recommends Fracture Closure Pressure as maximum injection pressure. Prefers in-situ stress testing to SRT. (In-situ stress testing is where fluid is injected above the break-down pressure [fracture pressure], and then pressures are monitored after fluid injection is stopped to determine closure pressure and pore pressure. The pumping cycle is often repeated multiple times.)

29. Cardinal Surveys Company 2009 EPA STEP-RATE TEST PROCEDURE: 1) The well should be shut in long enough prior to testing such that the bottom hole pressures approximate shut-in formation pressures. If the shut-in well flows to the surface, the wellhead injection string should be equipped with a gauge and the static surface pressure read and recorded. 2) A series of successively higher injection rates are determined using guidelines below, and the elapsed time and pressure values are read and recorded for each rate and time step. Each rate step should last exactly as long as the preceding rate. If stabilized pressure values are not obtained within the rate steps suggested below, the test results may be considered as inconclusive. http://www.epa.gov/region8/water/uic/INFO-StepRateTest.pdf

30. Cardinal Surveys Company 2009 EPA STEP-RATE TEST PROCEDURE: Formation Permeability (md) Total time per rate-step (min) ≤ 5 md 60 min ≥ 10 md 30 min 3) Suggested injection rates (percent of maximum anticipated injection rate): 5%, 10%, 20%, 40%, 60%, 80%, 100% 4) Injection rates should be controlled with a constant flow regulator that has been tested prior to use. A throttling device is not considered sufficient. 5) Flow rates should be measured with a calibrated turbine flowmeter. http://www.epa.gov/region8/water/uic/INFO-StepRateTest.pdf

31. Cardinal Surveys Company 2009 EPA STEP-RATE TEST PROCEDURE: 6) Record injection rates using a chart recorder or a strip chart. 7) Measure pressures with a down hole pressure bomb. If a surface gauge is used, the test pressures must be corrected for the estimated friction loss at each particular flow rate. 8) Measure and record injection pressures with a gauge or recorder (for immediate test results). Record each time step and corresponding pressure. http://www.epa.gov/region8/water/uic/INFO-StepRateTest.pdf

32. Cardinal Surveys Company 2009 EPA STEP-RATE TEST PROCEDURE: 9) A plot of injection rates and the corresponding stabilized pressure values should be graphically represented as a constant slope straight line to a point at which the formation fracture, or “breakdown”, pressure is exceeded. The slope of this subsequent straight line should be less than that of the before-fracture straight line (see example). http://www.epa.gov/region8/water/uic/INFO-StepRateTest.pdf

33. Cardinal Surveys Company 2009 EPA STEP-RATE TEST PROCEDURE: 10) If the formation fracture pressure has definitively been exceeded, as evidenced by at least two injection rate- pressure combinations greater than the breakdown pressure, the injection pump can be stopped, and the line valve closed and pressure allowed to bleed-off into the injection zone. There will occur a significant instantaneous pressure drop (Instantaneous Shut-in Pressure or ISIP), after which the pressure values will level out. This ISIP value must be read and recorded. The ISIP obtained in this manner may be considered to be the minimum pressure required to hold open a fracture in this formation at this well.. http://www.epa.gov/region8/water/uic/INFO-StepRateTest.pdf

34. Cardinal Surveys Company 2009 EPA STEP-RATE TEST PROCEDURE: 11) Once the ISIP is obtained, the SRT is concluded. 12) In the event that the breakdown pressure was not obtained at the maximum test injection pressure utilized, the test results may indicate that the formation is accepting fluids without fracturing. http://www.epa.gov/region8/water/uic/INFO-StepRateTest.pdf

35. Cardinal Surveys Company 2009 EPA SRT Example

36. Cardinal Surveys Company 2009 Other method: 2 Step Method SPE 18,141 – Singh and Agarwal, 1989. U.S. Patent No. 4,793,413 – Singh, Agarwal and Miller, 1988. Uses continuous recording of rate and pressure data. Step one below FPP, Step two above FPP. Delta time vs Delta pressure plots determine FPP.

37. Cardinal Surveys Company 2009 Examples Follow