Unconventional Techniques Seen Reviving Old Conventional Fields

“While our analysis was an initial, high-level assessment of low-productivity plays outside the U.S., we were quite surprised at the impressive potential for increased recovery using these unconventional techniques,” said Susan Farrell, vice president of upstream energy research at IHS and one of the authors. “As many of the world’s oil and gas producers struggle to lower costs and optimize existing assets, we wondered what kind of impact the application of newer technological innovations could deliver to the industry in terms of expanding conventional resource potential outside North America.”

IHS notes the rock properties in these mature plays are less than desirable for production using conventional techniques. As a result, many have produced only a small portion of the total oil in place. Of the estimated 141 Bbbl of potentially recoverable oil using unconventional techniques, the IHS assessment determined that 135 billion of those barrels exist in plays that would likely require hydraulic fracture stimulation to produce, while about 6 Bbbl sit in plays that may not require hydraulic fracturing.

“Drilling horizontal wells allows access to thinner zones, where vertical wells are not commercially productive,” explains Leta K. Smith, director of upstream energy research at IHS Energy and principal analyst. “Also, horizontal wells allow engineers to connect compartmentalized portions of the reservoir with one well instead of many vertical wells, which addresses cost and footprint considerations as well as increasing the well-to-reservoir contact ratio.” In addition, the study says, modern seismic and measurement-while-drilling technologies would allow operators to achieve better placement of fractures to take advantage of natural fracturing and other geologic features for maximizing production and avoiding water zones.

According to IHS, low-productivity conventional fields that could benefit from new technologies are relatively evenly distributed across various regions of the world, but two-thirds of the estimated potential incremental oil volumes are in the Middle East and Latin America. While many of the top-15 countries identified for increased production are access-limited for international oil companies, within North America, Mexico holds substantial incremental oil. With the upcoming opening of the country’s upstream sector, Mexico may see new investment in these types of resources. “For operators with experience in these drilling and completion techniques, Mexico may be an attractive option for future investment, along with some of the 14 countries identified outside the Middle East, including Brazil, the U.K., Norway, Congo, and Indonesia,” Smith said.