1. DECISION TREE Developed for the National Petroleum Technology Office By Brian Keltch & Andrew Hastings bkeltch@npto.doe.gov (918) 699-2065 TRW Presented By Len Volk

2. What Is It? Computer program Aids making decisions & risks in these decisions Organizes available information Highlights missing data Provides “big picture” Applicable to any process or project

3. Outline Demonstrate program using a simple example Apply decision tree concept to:  Hydraulic stimulation of oil & gas wells  Evaluating a sand deposit Future enhancements

4. Choice Node: Alternatives or choices – Name Chance Node: Multiple uncertainties – Name & Probability Value Node: The terminal node - Value

5. Propagation of Fracture With Time

6. Fracture Cross Section Shale

7. Typical Information Available About a Well Reservoir depth Bottom hole temperature Fluid type (oil, water, gas) Production history Initial logs (pay thickness, porosity, bounding zones) Initial well test (P o, k) Reservoir rock characteristics (SS, LS, clay)

8. Fracturing-1 Workover IOR Fracture Horiz Well H 2 O Flood New Well Nothing Propellant Explosive Hydraulic Consultant Internal Service Co. Me Cycle 1Cycle 2Cycle 3

9. Fracturing-2 No CBL No W Test W Test: p, s Consultant Internal Service Co. Me Run CBL Cycle 3Cycle 4Cycle 5

10. Data for CBL CBL cost Remediation cost Frac job cost Current production Oil price Post frac production Production loss if bad CB No. day/yr production $5000 $15,000 $100,000 10 Bbl/day $30/Bbl 30 Bbl/day 2 Bbl/day 200 day 5yr revenue increase with frac: $600,000 5yr loss in revenue if CB bad: $60,000

11. Cement Bond Log Run CBL Cost: $5000 No CBL P=40% CB bad CB OK P=60% CBL bad, fix Cost: $15,000 CBL OK CB OK P=90% CB bad P=10% CB fixed P=80% CB bad P=20% $495,000 $-165,000 $480,000 $-180,000 $-160,000 $500,000 [$445,000] [$-16,500] [$384,000] [$-36,000] [$300,000] [$-64,000]

12. Fracturing-3 No CBL No Perfs Re-Perf Run CBLNo Test Stress Test Annulus Casing Tubing No Pr Test Pr Test Estimate Cw FO Test: Cw Cycle 8 Cycle 6Cycle 5 Cycle 10Cycle 9 Cycle 7 Core Test:Cw

13. Fracturing-4 250-1000’ 1000-2000’ Annulus Casing RC Sand MS Sand Tubing <250’ >2000’ HS Sand ISP HSP Cycle 10Cycle 11Cycle 12

14. Fracturing-5 16/30 Mesh 12/20 Mesh RC Sand MS Sand 40/70 Mesh 8/16 Mesh HS Sand ISP HSP 20/40 Mesh Foam Emulsion WB Fluid HC Fluid Cycle 12Cycle 13Cycle 14

15. Fracturing-6 CMHPG HPG Water Guar HEC Foam Emulsion WB Fluid HC Fluid No X-Linker X-Linker Cycle 14Cycle 15Cycle 16

16. Fracturing-7 Titanate Borate Enzyme NoneZirconate No X-L X-LinkedOxidant Cycle 16Cycle 17Cycle 18

17. Fracturing-8 Enzyme None Oxidant Encapsulated No 100 Mesh Sand Oil-Sol Resin Silica Flour None Ca Carbonate Cycle 18Cycle 19Cycle 20

18. Fracturing-9 5% Diesel No HC 3% Diesel Clay Stab 2 KCl 100 Mesh Sand Oil-Sol Resin Silica Flour None Ca Carbonate Cycle 20Cycle 21Cycle 22 Clay Stab 1 None

19. Fracturing-10 25% Pad 50% Pad 10% Pad Clay Stab 2 KCl 15-25Bbl/m 25-50Bbl/m 50-100Bbl/m Cycle 22Cycle 23Cycle 24 Clay Stab 1 None

20. Fracturing-11 Flow Back Shut-In 10-25Bbl/m 25-50Bbl/m 50-100Bbl/m Small Serv Co Major Serv Co Indep Serv Co Cycle 24Cycle 26Cycle 25

21. Development of a Sand Deposit Do C Do B Do A Do D Do A Do B Do C Do D No Short cut notation

22. Sand Deposit-1 Surface Maps Wells Excavations Satellite Survey Existing Data Aerial

23. Sand Deposit-2 30’ Back Hoe 10’ 200’ Sample Collection 60’ Depth Spatial Pattern Factorial 1000’ 500’ 100’ 20’ Core

24. Sand Deposit-3 Glass Sand Water Pack Aggregate Frac Sand Evaluating Potential Products Blast Sand Pr Minerals Rd Base Cement Asphalt Aqua Regia Elemental Mineral Fire Assay Sieve Anal Mineral Sol. Mineral Anal Round&Sphere Crush Res. Re, Os Au, Pd Pt, Rh

25. Sand Deposit-4 Transportation Classification Scrubbing Disaggregation Frac Sand Development Washing Mining Frac Sand Equipment? Consolidated? Overburden Screen Type? Screen Size? Mesh Sizes?

26. Planned Enhancements Allow Decision Tree to be placed into a Word document or PowerPoint presentation Add ability to edit directly from screen Several improvements in editing branches Allow printing as Portrait or Landscape Many others – given in Slide Notes

27. Len Volk International Separations Technology, Woodward, OK The University of Tulsa, Petroleum Engineering PCM Technical, Tulsa, OK Consultant, Tulsa, OK (918) 481-5948 (918) 852-6546 (cell) lenvolk@swbell.net