Key Challenges in the Oil Industry: 2017 and Beyond

American Association of Petroleum Geologists (AAPG)

We're in our third year of downturn, and yet there is quite a bit of activity in some plays such as the Permian Basin and the STACK play in the U.S. MidContinent and in Middle East fields. The reasons have to do with increased efficiency in drilling and completing horizontal wells, and the ability to recover reserves that were previously not recoverable. They also have to do with relative security and new availability of capital.

There are other opportunities as well as groups have launched start-ups with the goal of applying new technologies to fields they have acquired as companies have shed their non-core assets. What no longer fits one person is a wonderful opportunity for another.

Here are a few key concerns for oil and gas operators today.

Efficiency and Cost-Effectiveness:

We need to find ways to effectively explore for and develop oil and gas, and to do it in a way that is environmentally friendly as well as cost-efficient, with better use of resources and better design, planning, and implementation of facilities and infrastructure.

  • Sweet spots
    • Shale plays - development and optimization of existing leases (all shale plays, including international such as the Vaca Muerta)
    • Shale plays -- wells drilled but not completed (Eagle Ford, Bakken, Woodford, Marcellus)
    • Traditional plays and stacked plays (Permian, STACK)
    • Mature fields -- in-field drilling and where to use EOR (enhanced oil recovery)
  • Reservoir revitalization
    • Revisiting mature fields (carbonates, siliciclastics, new stacked pays)
    • New enhanced oil recovery (waterfloods, CO2 floods, etc.)
  • Optimizing pad drilling with shale plays
    • Blended plays with multiple benches (Permian, STACK)
  • Using imaging for effective mapping and planning locations and infrastructure
    • Tight gas sands w/ variable sand lenses, with differences in porosity and permeability
    • Determining fracture networks and directions of flow
    • Understanding geopressure regimes for frac design
    • Determining the impact of diagenesis on pore types / size (and effective porosity)
  • Offshore
    • New shallow and deepwater reservoirs, better seismic and imaging (Gulf of Mexico, Caribbean, offshore Brazil, Mediterranean, East Africa, West Africa, Indonesia, Brunei)
    • Better recovery from mature fields (North Sea, offshore Vietnam / China / West Africa)
  • New Frontiers
    • New methods of basin analysis
Environmental concerns

The implications have to do with dealing with produced water, aquifer protection during hydraulic fracturing, and pinpointing and eliminating spills and emissions It also means proper monitoring and incident-response.

  • Protecting the aquifer during drilling and completion
  • Dealing with produced water
  • Dealing with fracking flowback
  • Methane detection / fugitive gas
  • Water solutions
  • Fugitive gas detection
New Analytics for Breakthroughs

We need to explore different types of information and data in order to make breakthrough observations and findings. We also need to integrate the information we have more completely and in different ways. New analytics will lead to new breakthroughs.

  • Geological
  • Production / reservoir information
  • Geophysical
  • Geochemical
  • Petrophysical
  • Surface data
Real-time Data while drilling and completing

We need to make more timely decisions using synchronous / simultaneous data capture and analysis, accessible in multiple places via the cloud

  • Remote sensing
  • Logging while drilling
  • Smart production
Cloud-based computing for the oil field

Security and confidentiality are increasingly challenging in a world of cloud data and the industrial internet of things (IIoT). Companies are faced with needing to process data but at the same time, they are challenged by the seeming penetrability and porosity of data, and well-publicized hacks such as Wikileaks and the large hack on Sony are not very effective confidence-boosters.

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