Unconventional?oil?production?has?had?a?far-reaching?impact?on?the?worldwide?oil?and?gas?industry.?The?surge?of?domestic?shale?oil?production,?particularly?from?the?Permian?Basin,?has?played?a?large?role?in?keeping?the?price?of?oil?low?while?also?pushing?North?America?to?be?a?leading?oil?producer.
Still,?hydraulic?fracturing?only?recovers?about?7%?of?oil?in?a?reservoir,?according?to?the?Energy?and?Environmental?Research?Center?(EERC).?And?even?with?longer?lateral?lengths,?tight?reservoirs?present?steeper?decline?curves?than?conventional?reservoirs?because?of?low?permeability.?That?leaves?vast?amounts?of?oil—?about?400?Bbbl?in?known?U.S.?reserves,?according?to?the?National?Energy?Technology?Laboratory?(NETL)—left?to?be?recovered?in?tight?rocks.
Various?studies?and?industry?experts?claim?the?density?of?tight?rock?reservoirs?isn’t?conducive?to?waterflood,?and?steam?injection?is?likely?to?prove?too?costly.?For?those?reasons,?CO2?EOR?methods?could?very?well?be?the?next?frontier?in?unconventional?oil?production.
Although?widespread?EOR?efforts?in?unconventional?plays?are?still?mostly?uncharted?territory,?at?least?one?company?has?cracked?the?code?in?the?Eagle?Ford?and?is?seeing?positive?results?in?tight?rock?CO2?EOR.?Meanwhile,?several?companies?and?government?agencies?are?making?significant?investments?in?research?for?EOR?in?unconventional?plays,?particularly?in?the?Bakken.
But?the?challenges?for?implementing?CO2?EOR?across?unconventional?resources?are?the?same?that?are?familiar?to?the?industry?when?facing?just?about?any?other?challenge:?economics?and?know-how.?Unconventional?resources?will?likely?require?an?unconventional?approach?to?EOR.?Among?those?looking?into?such?recovery?efforts?is?the?Research?Partnership?to?Secure?Energy?for?America?(RPSEA).
“It’s?going?to?be?one?of?those?things?where?[EOR?in?unconventional?reserves?is]?going?to?take?a?while?to?crack?the?safe,?and?it’s?best?to?work?on?that?collaboratively,”?said?Jack?Belcher,?business?program?director?for?RPSEA.?“There’s?a?will?to?do?it,?but?there?is?no?will?for?companies?at?$50?oil?to?spend?much?money?on?it.?[EOR]?is?a?completely?different?animal?with?low?permeability.?It?could?take?a?government?program?to?get?it?going.”
EERC?studies?the?Bakken
Among?the?organizations?exploring?the?possibilities?of?CO2?EOR?in?unconventional?resources?is?the?EERC?in?Grand?Forks,?N.D.?Specifically,?the?EERC,?which?is?funded?by?state?and?government?agencies?as?well?as?several?oil?companies,?is?researching?the?potential?utilization?of?CO2?EOR?in?the?Bakken.
In?2012?the?EERC?initiated?a?study?of?CO2?storage?and?EOR?in?the?Bakken,?with?Phase?1?using?reservoir?characterization?and?laboratory?data?such?as?core?analyses,?well?logs?and?oil?analyses.?The?study’s?Phase?1?results?revealed?CO2?could?potentially?recover?more?than?90%?of?hydrocarbons?from?Bakken?reservoir?rocks?and?more?than?60%?from?Bakken?shales.?However,?Jim?Sorensen,?EERC?principal?geologist,?said?those?numbers?were?“crazy?high”?and?likely?would?not?be?realistic?in?real-world?applications.
“When?we?talk?about?90%?removal,?that?is?on?very?small?core?plugs?under?lab?conditions?where?the?whole?point?is?to?extract?as?much?oil?as?we?can,”?he?said.?“We?don’t?believe?everyone?can?get?90%?from?the?Middle?Bakken?or?60%?from?shales.”
Phase?1?of?the?study?was?completed?in?2014,?and?Phase?2?was?only?recently?initiated?by?the?EERC.?Sorensen?said?Phase?2?involves?applying?the?information?and?data?the?EERC?learned?in?its?Phase?1?laboratory?work?to?perform?field?tests?in?the?Bakken.
“We?think?we?understand?what’s?going?on?at?smaller?scales?at?the?mechanism?standpoint?and?how?to?update?that?on?the?reservoir?scale,”?he?said.?“The?biggest?part?of?Phase?2?is?to?take?things?we?saw?in?the?lab?and?in?modeling?and?go?to?the?field?to?try?to?do?a?scientifically?robust?field?test.”
In?late?June?the?EERC,?in?partnership?with?XTO?Energy,?initiated?a?field?injection?test?on?an?unstimulated?vertical?well?in?the?Bakken.?Sorensen?said the CO2 injection field test was conducted over a period of about two weeks, with the results potentially being made public by the end of the year.
“This particular test will not give us a direct number like [the ones seen in Phase 1], but we think the data we generate will help us predict a model and predict what final recovery might be,” he said.
Sorensen said one of the biggest barriers to widespread implementation of CO2 EOR in unconventional reservoirs is overcoming the problem of conformance. According to Halliburton, conformance technology is “the application process to reservoirs and boreholes to help reduce production of unwanted water and/or gas to efficiently enhance hydrocarbon recovery.”
“Fractures make conformance difficult but not impossible,” Sorensen said. “One of the things that needs to be understood through additional engineering is that we need to figure out how to control conformance. My personal belief is we’re a couple of years away from figuring out conformance. Those guys at EOG [Resources] may have figured out the solution to conformance. If they can figure it out, someone else can figure it out too.”
EOG in the Eagle Ford
EOG Resources has, it appears, figured it out. The Houston- based independent oil and gas company appears to have cracked the code of CO2 EOR in unconventional reservoirs. According to EOG, the company began working on EOR three years ago and achieved production and economic success on four pilots involving 15 wells at its Eagle Ford site. In 2016 EOG completed a 32-well pilot at Eagle Ford that was also successful. The company said in an emailed statement that it was implementing EOR on another 100 wells.
“EOR will become a regular part of our Eagle Ford development going forward, and once we have more datapoints and production history, we hope to provide a total resource estimate attributable to EOR,” said John Wagner, engineer investor relations for EOG Resources.
Lloyd Helms Jr., executive vice president of E&P for EOG Resources, said during the company’s fourth-quarter 2016 conference call that its 32-well project’s economics included a finding cost of less than $6/bbl, and between 2011 and 2016 the company saw favorable results with well spacing ranging from 61 m to 152 m (200 ft to 500 ft). Helms said EOG Resources produced 300 Mbbl of net oil production from its EOR efforts in 2016.
“This data supports our previous estimates that the incremental recovery due to EOR is adding 30% to 70% more oil to our primary recovery estimates,” Helms said.
EOG has traditionally been reserved when pressed on its specific methods and technologies, saying such information is proprietary. But it has revealed that two key components exist when implementing CO2 EOR at an unconventional resource: the importance of understanding the geology and developing a successful drilling plan. What works in the Eagle Ford may not necessarily work somewhere else, said EOG CEO William Thomas during the company’s first-quarter 2016 conference call.
“The Eagle Ford is unique,” Thomas said. “The same geologic characteristics that make the Eagle Ford prolific in primary development also make it unique for enhanced oil recovery. The EOR process we are using to produce incremental oil out of the Eagle Ford is not necessarily applicable to other horizontal basins. No. 2, how you initially drill the field matters. Secondary recovery works best on leased units that were developed using the best completions with optimal spacing.”
And perhaps most importantly, EOG figured how to make EOR in shale economically feasible. The company’s premium drilling program has turned into what Helms calls a “game changer” in terms of low-cost production, and its EOR program in the Eagle Ford rivals those returns.
“We figured out how to execute EOR economically,” Thomas said. “The process can be implemented at rates of return that rival our premium drilling and significantly lower finding costs over time.”
A tempting target
Outside of the successes seen by EOG, widespread implementation of CO2 EOR methods in unconventional reservoirs is still in the early developmental stages. Several efforts by institutions such as the EERC and also Texas Tech University, RPSEA and the University of Wyoming have yielded inconclusive but encouraging results. Other institutions such as NETL and the U.S. Department of Energy are funding efforts to study EOR in unconventional reservoirs.
According to a study published by Elsevier, a research publishing company, “Little EOR research has been done on these deposits, in part because their exploitation has been so recent. But the potential is huge—and so is the major challenge: extremely low permeability.
“Low prices have kept investors and companies focused on drilling new shales in the most economical areas of shale plays,” the report stated. “Until these sweet spots are exhausted and prices head higher, any progress on EOR in shale is likely to be stalled. But with 95% or more of the oil left behind, shale will remain a tempting target.”