Intelligent completions migrating to shallow water, lower cost wells

Cableless, battery power in future

Jerry Greenberg
Contributing Editor

As the offshore industry moves into deeper water and more expensive wells, with the potential reward of larger reservoirs and higher flow rates, completion technology becomes more important in efforts to reduce costs over the life of a well or field. However, in the present low oil price environment, operators must choose between higher up front costs for some completion systems versus savings in the future.

There is no significant technical difference in a well completion in several thousand ft of water versus several hundred ft of water. Because of the expense of deepwater wells, more intelligent completions likely will be used in deepwater and subsea wells. However, there may be some applications in shallow water, marginal wells that may make those wells economic to complete, if there were no intervention costs involved.

When the industry first began installing multilateral completions there were not many options available.

"Recently we have come up with enough systems, that it was getting tough to compare the functions and flexibility of one versus the other," said Cliff Hogg, Senior Applications Engineer for Baker Oil Tools in Houston.

Multilateral completions

Consequently, a group of operators, under the name Technology Advancement of Multilaterals (TAML), developed a six-tier level of multilaterals. "We used to say it is based on the levels of complexity," Hogg said, "But it really is more the levels of functionality or flexibility of the system." According to Hogg, the following is a breakdown of multilateral types:

Level 1:A well in which both the main bore and the lateral are open hole.
Level 2: When the main bore is cased and cemented, but the lateral or at least the junction area, is open hole.
Level 3: Where the main bore is cased and cemented and the lateral bore typically has a slotted liner or some type of casing extending through the window section to provide mechanical support at the junction.
Level 4: One where the main bore and lateral bore are cased and cemented to provide a mechanical support at the junction area.
Level 5:When a hydraulic isolation is created, in addition to the mechanical support at the junction. "With a Level 4 system, while you do have mechanical support, you do not necessarily have pressure isolation," Hogg said. "With a Level 5 system, we isolate that junction so that pressure drawdown or injection pressuring up won't affect the junction or break down the junction itself."
Level 6: Essentially the same as a Level 5 multilateral. "With a Level 6, we are creating the hydraulic isolation, not through the use of additional completion equipment, which we do with the Level 5 system, but we are creating the hydraulic isolation at the casing itself. We're sealing off at the casing point," Hogg said.

Recent experiences

The significance of the Level 5 multilateral for Petrobras last September is that it was completed from a floating rig - in this case, a semisubmersible. Petrobras said that completing the well as a multilateral enabled the company to reduce the number of wellheads from two to one, and saved substantial capital expense associated with extra seabed pipeline.

Baker had previously installed a Level 5 multilateral in the Gulf of Mexico in December 1996 from a bottom-supported rig, which was the world's first Level 5 multilateral. In fact, Baker completed the world's first Level 6 multilateral in an onshore well in California last October. But installing a multilateral well from a floating rig proved the technology, according to Hogg.

"We never felt that this Level 5 system could not be used off a floater," Hogg said, "But we had to show that the risks were not huge. We're in the process now of trying to get another Level 5 in Brazil."

"There is no getting around that we are putting a lot of equipment downhole when we're doing a Level 5 or having to do the hydraulic isolation," Hogg said. "Because we're cutting a casing exit there are some things that become tougher."

Debris management

Debris management can also become more difficult. "We did several things downhole to help us with our (debris) situation. We had a new debris removal tool that helped us circulate out or gather debris without having to go through the drilling riser. We had our metal muncher technology, which is not dependent on weight on bit to get the casing exit cut correctly."

"We did not have to worry nearly as much about trying to keep exact weight on bit while we were doing the work, "Hogg said. "Therefore, the motion (of the rig) did not have as much affect on us." The well was completed in 60 days, 15 days less than the original estimate.

As far as installing multilaterals from a floating rig in the Gulf of Mexico, Baker is talking with several operators but "it's just a matter of who has the budget to do the work right now."

"As far as the Gulf of Mexico goes," Hogg said, "it's a valid system but certainly with the state of budgets and oil prices, everyone is being cautious about what kind of projects they pick up."

"From a technology standpoint, we feel we probably overcame the hurdle as far as proving up that particular type of technology. However, we still have to sell the project to the people, and with the budgets being shrunk it going to be a little tougher."

From purely a cost to get the system into the ground, Baker wants to get it in at less than two times the cost of a single well, which the company says it can do, according to Hogg. Because of varying conditions, it is difficult to come up with a single figure but Hogg believes 1-1/2 times the cost of a single well is the target.

"The key is not just looking at the cost of two versus one but looking at the overall value of the project in terms of getting more drainage, having the ability to increase your overall production and getting a much longer reserve life because of better production efficiency."

Intelligent completions

There are varying degrees of intelligent completions, and varying definitions among the various companies in the business. For example, Schlumberger's Camco defines an intelligent completion as ranging from something as simple as an inflow control device to being able to monitor separate zones.

"What an intelligent completion gives you is the ability, without intervention, to see at the surface what is going on downhole," said Rodger Lacy with Camco.

"An intelligent completion could run as simple as an inflow control device that can be manipulated at the surface," said David McAlvin with Camco, "to having complete monitoring gauges coupled with inflow devices to be able to monitor separate zones and shut off certain zones or control the flow completely."

Based on that definition, Camco has installed more than 80 intelligent completions, according to McAlvin. Most of Camco's intelligent completions are in the North Sea, but they have installed several in the Gulf of Mexico.

Intelligent well completions can aid in reservoir management and help extend the life of a well or field. They can also reduce or eliminate the need for costly interventions, which is critical in deepwater where interventions can cost several millions of dollars.

"A typical subsea well could cost $6-$8 million," McAlvin said. "If you have to have an intervention, that's typically about $2 million, and you have a $10 million well, which may not be economic. But if you spend another half million dollars and do it the best way possible, then you don't have to go back into the well. So a little more expensive completion up front may be more cost effective over the life of the well."

"Everything is based on intervention costs," McAlvin continued, "so when you have a deepwater application you want to make sure you have high durability products that minimize intervention. The best products are typically not the least expensive products up front but they may very well be the most durable products and services."

"If you set up a well to produce one zone and then you have to go back in and do a workover to change zones," said Tim Tips with Petroleum Engineering Services (PES) in The Woodlands, Texas, "You're going to spend a minimum of $3 million. If you can set up the well to produce multiple zones or multiple reservoirs from a single wellbore at the time of the initial completion and you can make those changes remotely, you can save yourself an intervention cost. And that has primarily been the big driver so far in the selection of these types of systems."

North Sea installations

Most of the higher levels of intelligent completion system have been installed in the North Sea. These include systems that can monitor temperature and pressure of multiple zones,

collect data in real time and have the ability to control flow from several zones from the surface. For example, Subsurface Technology in Stavanger, Norway, a subsidiary of Weatherford International's SubTech International, has been looking at intelligent completions since 1993, according to Henning Hansen, president of Subsurface Technology.

"We were the first company to actually install sensors in the well and access certain sensors at different depths," Hansen said. "That proved we could send commands to various nodes downhole. We could also select the sensors we wanted to receive data from."

"We did a job for a Norwegian company where we installed 132 sensors in a subsea well in about 1,400 ft of water," Hansen continued. "We used a data logging system there where we could send data to the surface." The company also has successfully utilized an acoustical data retrieval system for Norsk Hydro in the North Sea.

PES installed the world's first smart well completion in a well offshore Norway for Saga Petroleum in September 1997 utilizing its SCRAMS (Surface Controlled Reservoir Analysis and Management System). The system was installed in the Upper Statfjord formation in the Snorre field. Electrical and hydraulic control lines to the surface allow Saga to monitor internal and external pressure of the internal control valve in real time in addition to controlling the position of the valve from the surface. At the time of the installation, Saga said that the system would enable it to significantly reduce maintenance and intervention costs by providing continuous real time reservoir control.

PES has completed five wells in the North Sea, including the Saga well, all of which were platform wells offshore Norway. Two wells in the Adriatic Sea were completed subsea.

First US Gulf completion

PES in The Woodlands has been contracted by British Borneo to supply an intelligent completion system (SCRAMS) for two wells on its Allegheny field in the Gulf of Mexico. Amoco also has contracted PES for a similar five-well system in its King field in the Gulf. The systems for both fields are comprised of two zone stacked gravel pack completions. The systems being installed are fully redundant with the ability to monitor downhole pressure and temperature.

British Borneo will operate the system through a direct umbilical tied back to the platform from the wellhead due to the close proximity of the platform to the subsea wellhead. Amoco, however, must utilize the subsea umbilical and control system due to the greater distance from the production facility to the subsea wellhead.

The British Borneo system will differ from the Amoco system in that to produce the two zones they are incorporating only one Internal Control Valve (ICV), or sliding sleeve. This is known as a dual zone ICV (DZICV).

Amoco is producing their pay zones through two independent sleeves to permit more control over reservoir production rates and commingling. "What we've done for the British Borneo well is used the dual zone system that permits either the lower zone to be produced only, the upper zone to be produced only, both zones can be commingled or both zones can be completely shut off," said Stuart McLaughlin with PES Inc.

The produced fluids from the two zones are separated by the implementation of a diverter shroud attached midway on the DZICV. This allows the upper zone to be produced over the outside of the DZICV, and the lower zone to be produced through production tubing installed through and sealing into the upper gavel pack lower end.

Amoco's intelligent system differs in that the two ICVs that are producing the pay zones separately are infinitely variable ICVs. These have been developed by PES and it's alliance partner Halliburton to allow the operator more control over the producing interval. These valves have the ability to operate an orifice size with a range of 0-100%. These systems are highly beneficial where zone pressures differ greatly because it allows for pressure balancing of the pay zones.

A limiting factor in the Gulf of Mexico is the general need for some type of sand control. Presently, this potentially limits to two the number of zones that can be independently produced. This is due to sand control system dimensions not permitting the installation of the intelligent control systems within the sand control systems themselves.

The UK North Sea does not incur sand control problems and therefore multi-zone control is available. Last April, PES installed Norsk Hydro's first four-zone intelligent well system. Two additional four-zone wells have since been completed for Norsk Hydro. Other systems are on order for several operators worldwide.

Shallow water applications

Intelligent well completions, while aimed primarily at deepwater wells, may be applied economically in shallow water or marginal fields. "(Intelligent completions) can make sense where you have a smaller field that can't support the infrastructure or the intervention costs because of its reserve base," said Chris Gann, Director of New Technology and Markets for Baker Hughes. "We initially thought the Downhole Factory would be applicable to high cost environments, but we're finding economic homes for it in smaller marginal fields that need these sorts of technologies or they won't be developed."

"Fields with marginal economics using multilaterals and downhole inflow control devices can virtually eliminate intervention costs and at the same time improve productivity and recovery," Gann said. "That could make a marginal field economic. There are a few of those that we've been looking at and it's' been a bit of an eye-opener. You think this high tech is for deepwater, but not totally."

There are still applications in shallow water for a single wellbore where the operator can keep closing the valves and plugging back zones, according to Camco. "Choosing the right system for the right application is the main key," McAlvin with Camco said. "What our inflow control devices and intelligent completions really give us is an opportunity to tap reservoirs that may not be economically viable otherwise."

Not all agree, however. Mike Bonvillain of Halliburton stated: "The thing that prohibits (smart wells) in shallower water right now is the cost of the completion and the smaller size of the typical reservoir. Your intervention costs are nowhere near the cost of intervening on a subsea well."

IC future

The various completion technologies are evolving rapidly, perhaps progressing to Baker Hughes vision of the future, the Downhole Factory, a completely self-contained intelligent completion that would even generate its own power. "The potential is enormous for robotic autonomous type devices to do all sorts of functions downhole," said Gann. "We're working with IS Robotics in developing mobility devices in which we can perform different functions such as assisting in fishing or logging operations, acquiring information, investigating and performing tasks."

"We demonstrated a system downhole where we don't need any electrical cable to it," said Hansen with Subsurface Technologies. "It's a system that is battery powered that supplies power to the entire casing or tubing or a combination or drillpipe. All we need is an electrical conduit downhole."

"We will be able to install sensors as well as valves into lateral sections or into liners or wherever you need them," Hansen continued. "We can charge the battery between operations without intervention. Such systems will be seen five years from now."

"I also think the systems will be more automated," Hansen said. "The well will do a lot of the intelligence itself."

"We see an increase in multilaterals and intelligent completions in the multilaterals," said David McAlvin with Camco. "Nobody has deployed anything like that as far that I know, and I can definitely see a trend toward that."

"You're going to see varying degrees of intelligent completion systems, from open/close hydraulic valves all the way to the SCRAMS system," said Tips with PES. "I think you're going to see an acceptance within the next year and a half to two years for this technology, at least within the Gulf of Mexico. I would say that most people are going to be using it in some fashion or form. I think the market is going to drive down the cost of wellbores. It's going to make you go to a redundant and totally integrated system."

"I don't really think it's going to be limited by water depth," Tips adds. "Different systems will apply to different applications with regard to water depth and even platform applications."

"More instrumentation is going to be available for those that want it or where it's economically viable to use it to measure all sorts of parameters downhole, enabling you to look further into the reservoir," Tips continued. "It's all going to be tied into reservoir modeling systems that are going to be continuously plugging and making adjustments to the well automatically. That's the long term."

Author

Jerry Greenberg is a Houston-based freelance writer. He has more than 18 years experience in the offshore industry, including 12 years as an analyst and reporter. He has also worked with several international offshore drilling contractors in marketing and communications.