The Oil Drum

Saudi Arabia’s Rapidly Thinning Oil Columns and Smart Well Installations

From Saudi Aramco’s press kit page 11
http://www.saudiaramco.com/sa/webServer/presskit/press_kit_full.pdf

”Technological Advances

Smart Wells and Intelligent Fields:
Smart well systems and down-hole sensors are part of a larger strategy to develop “intelligent fields,” an approach that combines real-time monitoring and timely reactions to changing well and reservoir conditions to optimize production and reservoir management. Overall, the company completed 24 smart well installations in 2005 (versus two the year before), and 55 maximum reservoir contact (MRC) wells, more than double the year before.”

To perform the above they needed one of these, a

”Geosteering Operations Center (GOC):
To further exploit the technological gains of horizontal, multi-lateral and MRC wells, Saudi Aramco opened the Geosteering Operations Center (GOC), where geologists and engineers remotely guide drilling activities in real time, around the clock, helping ensure that every well is optimally situated.”

In 2004, Saudi Aramco completed two smart well installations. In 2005, they completed 24 – that’s a twelve fold increase in one year! The world’s first smart well installation was in 1997 for SAGA Petroleum in the Snorre Field, Norway.
http://www.halliburton.com/news/archive/1997/hesnws_090497.jsp

Why do we need smart wells?

According to Martin Madsen, Production Engineer Visund, Statoil,
http://bergen.spe.no/doc/1%20day%202006/Presentasjoner%20PDF/Peer%20Gynt...

”– Compensate for different reservoir properties
•Pressure, PI etc
– Balance inflow
– Close / choke back zones with high GOR or WC
– Save intervention (time and money)
– Take into account the unexpected”

Point three above is important as zones with gas or water breakthrough can be closed or choked back using “above ground” controls. In other words, in these zones the column of oil is too thin to extract. (GOR – gas oil ratio; WC – water cut)

Smart well studies by Baker Hughes
http://www.bakerhughes.com/bakerhughes/water_management/completion_IWS.h...
state that the use of smart wells can increase ultimate recovery by 53%. The main reason for this is the improved ”management of undesirable fluids”.” (The undesirable fluid is water.)

On an annual basis, from 2004 to 2005, Saudi Aramco has a twelve fold increase in smart well installation completions from 2 to 24; and a two fold increase in MRC well completions to 55. (would be nice to have 2006 data – Haradh Increment III was completed in early 2006 with 32 intelligent MRC wells – intelligent=smart. I don’t know if these 32 wells are partly counted in 2005 data)

The huge increase in smart well installations and MRC well completions from 2004 to 2005 strongly indicate that Saudi Arabia is now extracting its last remaining oil reserves – difficult to extract oil from their rapidly thinning oil columns. Saudi Arabia's oil production rate may already have passed its peak.

For more information about smart wells - this website is good.
http://www.welldynamics.com/technology/installations.htm
Welldynamics have installed 228 smart well up to October 2, 2006. They state that this is more than 50% of the world's smart wells so it could be assumed that there are about 400 to 450 smart wells worldwide.

This is a link to Shell's snake well technology, (I think a type of smart well as it uses smart technology). The video on the right is worth playing. It states that without this technology the oil was previously inaccessible.

http://www.shell.com/home/Framework?siteId=technology-en&FC2=/technology...