Drilling and Production Technology: Past, Present and Future

Lopukhov A.N.  OJSC Samotlorneftegaz
Ph.D.Econ., Avanyan E.A.  LLC Nitinoil
Cand. Sc. Eng. Khalov M.O.  MAI

It is commonly accepted that the development of oil and gas deposits is the scientific process of extracting hydrocarbons and associated minerals from the subsoil. This process includes the drilling and production of the reserves. In this article, we will expand on this definition and amend it with the process of oil, gas and water treatment (OGWT), and transportation to OGWT. This will enable us to see the deposit as a single system which could be managed through its lifecycle.

The petroleum industry takes its roots from the time when the first oil well was drilled by Colonel Edwin Drake in 1859 in Pennsylvania, USA. The well was 23 m deep (75 feet). On August, 27th the first oil was extracted using a hand pump [2]. In Russia, the first well was drilled in 1864 in Kuban region by a Russian entrepreneur A.N. Novoseltsev [1]. Let us briefly review the development of petroleum industry and time it into stages based on volumes of global oil production, mainly because extracted oil is the final indicator of deposit development (fig. 1) [2]. The below chart shows global hydrocarbon production since 1860 through 2006.

The graph demonstrates that up until 1950s, oil production was growing steadily, however since 1950 its growth started speeding up. During 1980-1989, oil production levels stabilized and since 1989 we observe steady growth. Hence the stages: first stage from 1859 to 1950, second stage from 1950 to 2000 and third stage from 2000 to 2011.

First stage
During this stage, many significant discoveries were made in science and technology, which later played a vital role in the development of the petroleum industry. The most significant ones are:
»    “The Scientific basis for development of oil deposits” by A.P. Krylov, was published. This work played a key role in the creation of a separate field of science for petroleum production;
»    Foundations were laid and new sciences were formed – the physics of oil and gas reservoirs (reservoir engineering), subsurface hydrodynamics, development of oil and gas deposits, technology and engineering for oil and gas mining [3];
»    First attempts were made at modeling petroleum
reservoirs – electromodeling (P.M. Belash);
»    A complex principle was set up for the resolution of methodological and applied problems; three departments of knowledge were used for this purpose – field geology, subsurface hydrodynamics and industrial economics;
»    The Oil deposit development bureau was established.  The bureau examined the development of fields and deposits and groups of deposits as a complex, over all problem;
»    Well drilling techniques were advanced, percussion drilling was replaced with rotary drilling and then with turbo-drilling. New methods of rock crushing were developed (electric drilling, explosion drilling);
»    The Christmas tree came into use, pipelines were used for oil transportation, and the gas-lift production method was introduced. New equipment for well operations was developed (ECP, RP);
»    First hydraulic fracture was performed in USA (1947);
»    First computing machine was developed (1946 in USA, 1949 in UK);
»    A number of large deposits were discovered, some of them are: Saudi Arabia (Al-Ghawar, 1948, 20 bln.t.; Abqaiq, 1940, 1.9 bln.t.; Qatif, 1946, 1.5 bln.t.). Mexico (Chicontepec, 1926, 22.1 bln.t.). Kuwait (Big Burgan, 1946, 13 bln.t.). Venezuela (Costa Bolivar, 1917, 8.3 bln.t). Russia (Romashkinskoye, 1948, 5 bln.t.) [4].

The average price for a barrel of oil during this stage remained around $20/barrel and only during the initial period between, 1861-1876, were there price fluctuations in the range of $10-110/barrel (exch. rate of 2008).

Second stage
During the second stage, the technologies and processes that were started in stage one continued to be developed:
Significant advances were made in resolving the problems related to development of combination drive reservoirs (solution gas and water);
»    A number of well development methods advanced significantly (the line drive water injection method was established);
»    Waterflooding became the main method of reservoir development;
»    Thermal (injection of heat, fireflooding) and physicochemical (carbon solvents, carbon dioxide, polymers and micellar-polymer) methods of reservoir stimulation were developed;
»    Numerical (mathematical) methods were used to calculate problems related to filtration of liquid in porous mediums;
»    Methods of formation evaluation based on hydrodynamic research data were established;
»    A theoretical basis was laid for the mathematical modeling of reservoir systems. Non-volatile oil model (Bler-Oil model) or beta-model [6];
»    Computer software for reservoir modeling was developed in Norway (STORM, IRAP) (Haldorsen &MacDonald, 1987), Stemforde (SCRF, GSLIB) (Deutsch and Journal, 1992), IFP (Heresim) [7];
»    Regulations for deposit development design were enacted, formulating the problem of creating geological and hydrodynamic 3D models (1996). A resolution of the Central Development Commission that stipulated the necessity of geological and hydrodynamic 3D models during the reservoir development design. This played a major role in further development of reservoir modeling [7];
»    The method for calculating deposit development using probability and statistical models was laid. Models of fractured and crack-porous oil saturated reservoirs emerged and developed;
»    Direct methods for the consideration of heterogeneity for reservoir fluid filtration started developing;
»    Probability and statistical methods for oil and gas production operations were developed, along with the application of synergetics for modeling of oil and gas production [8];
»    Wide application of new technologies, materials and equipment for deposit exploration and development;
»    Advances in computing equipment;
»    A special design bureau was established for the design, research and implementation of rodless pumps (SDB RP). Founder – A.A. Bogdanov (1950);
»    Jet pumps (1969), screw pulsers (1980) and diaphragm pumps were used for well operations, “tandem” technology was developed (ECP+jet pump);
»    Theoretical substantiation of hydrofracturing in USSR (Khristianovich S.A., Zheltov Y.P., 1953);
»    First attempts at using automated management systems for oil production in Azerbaijan (1951-1952, not successful) [9];
»    Principal provisions for field construction and automation of oil and gas production enterprises were approved (1968) [9];
»    A number of large deposits were discovered, including: Saudi Arabia/Kuwait (Safaniya-Khafji, 1951, 11 bln. t.), Saudi Arabia (Manifa, 1966, 3.7 bln.t., Khurais, 1963,  2.7 bln.t., Shaybah, 1956, 2.4 bln.t., Zuluf, 1965, 2 bln.t., Berri, 1964, 1.9 bln.t., Abou Safi, 1966, 1 bln.t.). UAE (Upper Zakum, 1969, 8.2 bln.t., Lower Zakum, 1965, 2.5 bln.t.). China (Datsin, 1959, 6.3 bln.t.). USA (Prudhoe  Bay Orion, 1969, 3.5 bln.t.). Mexico (Cantarell Group, 1971, 5.7 bln.t.). Kazakhstan (Tengiz, 1979, 3.1 bln.t). Russia (Samotlorskoye, 1965, 7.2 bln.t., Priobskoye 1982, 5 bln.t.) [4].

The price for a barrel of oil during this stage had fluctuated within a number of ranges. In 1950 – 1970, the average price was $18/barrel, in 1970 – 1986 it has gone up to $100/barrel and then dropped to $27/barrel. In 1986 – 2000, the average price was $27/barrel (exch.rate of 2008).

Third stage
During the third stage, the development of technologies to increase production efficiency continued.
»    Detailed research in geology, geophysics, gas-hydrodynamics was underway. New methods of field data analysis and reserves estimation were developed. Rapid development of improved oil recovery methods (thermal and physiochemical EOR methods), for separate wells as well and for entire deposits etc. [10];
»    Modernization of drilling methods and practices, development of methods for operations efficiency assessment and equipment performance and condition. Quality of drilling fluids and cement slurries increased. Advancements in telemetric system, first applications of side-tracking and multilateral drilling etc. [10];
»    Advancements in well surveying methods, new methods for water production restraining (WPR), usage of polymers, remedial cementing operations (RCO). Implementation of thermal pressure chemical methods, acoustic and vibration reservoir stimulation for EOR. New methods of scaling control and paraffin control are implemented. Various types of analyses are developed and implemented (for development, technology efficiency etc), application of coiled tubing etc. [10];
»    In 2006, at Priobskoye oil field (Rosneft), “Newco Well Service” company had performed hydrofracturing (HF), 864 tonnes of proppant were injected into the formation (standard volume is 30 t);
»    Wide implementation of new designs in centrifugal pumps (“Alnas”, “REDA”, “Borets”), equipped with pressure and temperature gauges. Manufacturing and application of small pumps (3 and 2 group), two screw submersible multiphase pumps, ac electronic motors. Implementation of smart operator stations: “Novomet”, “Electon”. Introduction of high-precision submersible remote measurement systems for ESP; new energy saving technologies and diagnostic methods for estimation of equipment life [10];
»    Development of field equipment using the latest materials (Nitinol);
»    Usage of shutdown valves in well operations; application of separated production and injection methods [11]. Existing check valves are equipped with manual and mechanical drives;
»    Modernization of oil treatment management systems, introduction of emergency situations oil treatment. Usage of digital pressure and temperature gauges, development of multi-neuroprocessors for computer-aided manufacturing of petroleum production facilities;
»    Implementation of smart power grid technology for oil production facilities, systems for automated management of production equipment, systems analysis methods used to resolve complex technical problems [10];
»    Advances in computing equipment and software (calculating, storage and processing of field data);
»    Wide implementation of modeling software for oil and gas deposit development (ROXAR, PETREL, ECLIPSE) [11];
»    “Guidelines for the development of permanent geological and technological models of oil and gas deposits” issued (2000) [11];
»    “Recommended practices for the creation of permanent geological and technological models of oil and gas deposits” are approved (2003) [11];
»    Problems of production engineering during the development and maintenance of geological hydrodynamic models, reserves estimation and reservoir engineering are being resolved [10];
»    A concept of mathematical modeling for reservoir systems based on a streamlined method is developed [10];
»    Possibility of using wireless management systems at processing facilities is examined [13];
»    Wireless geophysical control method for producing formations is developed [14];
»    Smart wells technology for underground gas storage facility is tested [15];
»    Integrated modeling – practical implementation of “Smart field” concept. Global approach to asset management [16];
»    Remote deposit development technology is proposed [17];
»    “Smart field” projects are implemented: “TNK-BP” [18], “Rosneft” [19], “SPD” (Salym Petroleum Development) [19], “Tatneft”, “LUKOIL”, “Surgutneftegaz”, “Slavneft”. Essentially, all of the projects are related to remote monitoring and producing wells management;
»    A number of large deposits were discovered: Brazil (Carioca Sugar Loaf, 2008, 11 bln.t.), Kazakhstan  (Kashagan West, East and South-West, 2000, 6.4 bln.t), Iran (Ferdous, 2003, 4.9 bln.t., Dasht-e-Abadan, 2001, 4.1 bln.t., Yadavaran, 2003, 3 bln.t.) [4].

The price of a barrel of oil during this time had grown significantly from $27 to $79/barrel. In 2011, it went up to $100 [4].

A considerable contribution to development of petroleum industry had been made by: D.I. Mendeleev, A.M. Butlerov, I.M. Gubkin, V.G. Shuhov, A. Darsey, L.S. Leybenzon, V.N. Shchelkachev, S.A. Khristianovich, I.N. Strizhov, A.P. Krylov, A.H. Mirzadzhanzade, F.A. Trebin, B.B. Lapuk, I.A. Charnyj, Muskat, Wyckoff, Botset, Leverett, M.M. Glogovsky, M.F. Mirchinka, I.M. Nikolaevsky, P.J. Polubarinova-Kochina, A. Konshin, R. Arnold, R. Andersen, Rekva, S. Charnotsky, K.Bil, J. Lewis, V. Kotler, M.V. Abramovich, V.V. Bilibin, M.M. Tikhvinsky, I.M. Muravyov, A.N. Dmitriyevsky, F.S. Abdulin, V.M. Muravev, S.K. Gimatudinov, J.V. Vadetsky, H. Aziz, E. Settari, H.F. Azizov, A.N. Drozdov, P.D. Lyapkov, K.R. Urazakov, V.V. Andreyev, V.P. Zhulayev, V.N. Ivanovsky, V.I. Darishchev, A.A. Sabirov, S.I. Ivanov, Y.P. Zheltov, I.T. Mishchenko, S.N. Zakirov and K.S. Basniev.

Having analyzed the stages described above, we can determine the most rapidly developing trends in the future:
A lot of attention is being paid to 3D modeling (regulations and guidelines issued for modeling, modeling software such as “t-Navigator” is developed, some extended work on the creation of mathematical models for specific problem resolution etc.).

Hydrofracturing, which emerged as far back as in 1947 in USA, has been substantiated and accepted as an efficient EOR method. The potential opportunities for companies performing HF are large. There are many ways to apply this method (interval, powered etc), and therefore it has many potential perspectives, especially considering that a lot of reserves are deposited in formations with low porosity and permeability properties.

Since 2000, many new technologies related to stage development equipment (dual injection operation and dual zone production) have been developed. This is due to the fact that simultaneous development of objects is prohibited, while this equipment makes it possible and thus increases oil production.

Many new technologies aimed at water production restraining (WPR) and remedial cementing operations (RCO) have been developed, mainly due to high watering of wells. Up until the 1990s, few of these works were carried out, but considering their growth over the last two years, in Samotlor in particular, the perspective potential of these methods has to be mentioned.

For all of the above stages of oil and gas development, the implementation of modern technologies in the oil and gas sector is at the top of the agenda, and will continue to be so in the future.

The largest number of technology developments and implementations thereof during the third stage are related to automated management systems (pressure and temperature gauges; automation of treatment for oil, gas and water; smart stations for ESP and RP control; practical implementation of “smart field” projects; introduction of smart power grids; remotely controlled check valves; wireless management systems; development of information technologies etc). The basis for this process was established back in 1968. Implementation of all the above mentioned systems will allow fields to be truly “smarter” in the future.

In overall summary, the following conclusions could be made:
»    Since 1859, scientists and engineers have worked together to create the scientific basis for hydrocarbon development.
»    Significant results were seen through scientific disciplines, complex methods and operational experience.
»    After the establishment of the initial foundation during the previous stage, some successful advances in technology  such as hydrodynamics, oil and gas formation physics, development of oil and gas deposits and engineering of oil mining have been made.
»    The majority of deposits discovered after the 1950s went into operation using water flooding, which significantly increased well flow time.
»    Between 2000 and 2011, 3D modeling spread widely
»    Price of oil increased by $63.5/barrel over 16 years time.

An increase in the average annual price for oil from $15.5/barrel (1994) to $79/barrel (2010) was partially related to the increased cost of its production. This is a regular phenomenon: as a deposit is depleted, well yield drops and water production goes up. The constant increase of liquid production results in higher utilization costs, hence an increase in the cost of the end product. This can only be avoided by either cutting operational expenditure (staff, transport, equipment, liquid utilization etc.) or by increasing ultimate oil recovery without increasing the water production. To reduce labour costs, it is necessary to implement automated systems for production processes and gradually transit towards “smart field” operations. To reduce liquid utilization costs, it is necessary to apply water production restraining (WPR) technologies and run the remedial cementing operations (RCO) (isolation of watered intervals and formations, eliminating behind-the-casing flows). To increase the incremental ultimate oil recovery, efficient geological and technical measures must be taken and multi-zone production equipment must be used.

The problem of increasing oil recovery has been there for a long time and many specialists are focusing their attention to resolve it. In the future, efficient EOR methods will be widely used: thermal and physiochemical methods, acoustic and vibration stimulation, complex measures such as RCO and acid treatment, well development control by limiting or increasing water injection, using huff-and-puff methods etc.

In tandem with this, we should expect to see a systematic approach to field development based on modeling and production management for the entire life cycle of the field, both through the application of 4-D modeling and real-time production management and also by the application of new geo-navigational technologies and horizontal drilling and well completions for multi-zone production. We should also expect the wide-spread application of full production automation and the application of new materials and equipment to reduce production and labour costs. This is of special interest to offshore deposit development and the development of deposits with severe climatic conditions. All this will ensure higher production rates and energy security for Russia.

List of references
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2    Shchelkachev V.N. “Russian and global oil mining” M. ANO IKI, 2002. 132 pgs.
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5    Mishchenko I.T. “Borehole oil mining”. M. “Oil and Gas”. 2003. 816 pgs.
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9    Gorev S.M. “Automation of production processes in oil and gas industry”. KamchatGTU Publishers. 2003. – 263 pgs.
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11    “Engineering practices”, #3, 2011, # 4, 2010.
12    Leonov I.V. Thesis. M. 2011.
13    I. McPherson, “Oil and gas technologies”. USA. # 2, 2008.
14    A.A. Shakirov. Thesis, 2009.
15    C. Brown, “Oil and gas review”, USA, 2008.
16    S. Lushnikova, 2010. Schlumberger.
17    J. Algeroy. “Oil and gas review”. 2001, USA.
18    Pchelnikov R.L. “Engineering practices”, # 10, 2011.
19    ROGTEC Magazine, # 22, 2010.