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HomeMy WebLinkAboutBarnett Shale presentationTinker, 2008 Bureau of Economic Geology Jackson School of Geosciences The University of Texas at Austin Scott W. Tinker A Brief Look at Natural Gas and the Barnett Shale Tinker, 2008 Unconventional Natural Gas Barnett Shale Outline Tinker, 2008 Global Energy Demand and GDP After: Koonin, 2008 1980-2004 ~3 billion people Tinker, 2008 87% fossil fuels today Conventional Oil Natural Gas Data from EIA 2007 US Energy Mix Coal Uranium Transportation Heat Electricity Tinker, 2008 1800 1855 1910 1965 2020 An n u a l U s e ( Q u a d s ) 1 0.1 10 100 Electricity’s Role Total U. S. Energy After Huber and Mills, 2005. Data: EIA, Annual Review, 2003. US Census Bureau, Historical Statistics of the US Colonial Ties t 1970 Energy used to produce electricity 45Q Electricity will play an ever greater role in the energy end use mix. Tinker, 2008 Electricity Options •Efficiency –Fuel, lighting, electronics, insulation –Challenge: Rebound effect •Natural Gas –Abundant, reliable, price volatility, and cleaner –Challenges: Global deliverability (LNG) and Access •Coal –Abundant, reliable, cheap and dirty –Challenge: Sequestration (IGCC w/CCS), financing, public perception •Nuclear –Abundant, reliable, moderate price and cleaner –Challenges: Waste disposal, security, public perception •Alternatives –Cleaner, less reliable and more expensive –Challenge: Capacity impacts cost and reliability Tinker, 2008 Tinker Forecast Demand Forecast 1.25% annual demand growth Historical Data: EIA October 2007: Forecasts: Tinker, 2008 0.00 20.00 40.00 60.00 80.00 100.00 120.00 140.00 160.00 180.00 200.00 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 Gl o b a l E n e r g y C o n s u m p t i o n ( q u a d s ) Petroleum Natural Gas Coal Hydroelectric Nuclear Biomass, Geothermal, Solar & Wind 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% % T o t a l C o n s u m p t i o n 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 4 8 16 32 2X every 7 yrs Tinker, 2008 Natural Gas Forecast 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 0.00 20.00 40.00 60.00 80.00 100.00 120.00 140.00 160.00 180.00 200.00 Gl o b a l E n e r g y C o n s u m p t i o n ( q u a d s ) 32,500 TcF Resources = ~ 200 years at 150 TcF year Source: SPE Paper 68755, National Petroleum Council, 2007 Tinker, 2008 0 5,000 10,000 15,000 20,000 25,000 1949 1954 1959 1964 1969 1974 1979 1984 1989 1994 1999 2004 Year U. S . N a t u r a l G a s P r o d u c t i o n ( B c f ) Total Natural Gas Conventional Gas Difference U.S. Natural Gas Production Conventionals: EIA (1949-1990) and NPC (1991-2015) Unconventionals: 1970-1988 data from GRI, 1999. Updated data from 1989-2005 is from EIA, 2007 0 1 2 3 4 5 6 7 8 9 10 1990 1995 2000 2005 2010 2015 2020 2025 Year An n u a l N a t u r a l G a s P r o d u c t i o n ( T C F ) Gas Shales Coalbed Methane Tight Gas Unconventionals Tinker, 2008 Unconventional plays •Marginal-quality reservoirs covering large areas •Artificial stimulation required – usually fracture treatments (“frac jobs”) •Per-well reserves are relatively low, and play success is sensitive to gas price •Small well spacing •Overall play production rate is very sensitive to drilling rate •Now a significant part of US gas production (over 30%) The Barnett Shale-Gas Play of the Fort Worth Basin: STARR Industry Seminar; November, 2006 Tinker, 2008 Unconventioinal Natural Gas The Barnett Shale Outline Tinker, 2008 What is the Barnett? •Mississippian age mudrocks •Dark colored fine-grained lithologies –Organic-rich siliceous mudstone, muddy limestone, etc •Widespread in Texas, up to 1100 feet thick in Ft. Worth Basin •More like a conventional source rock for oil •Definitely not a conventional producing zone! The Barnett Shale-Gas Play of the Fort Worth Basin: STARR Industry Seminar; November, 2006 Tinker, 2008 FWB Barnett Stats (RRC) January 2008 •7170 gas wells •More than 3.2 TCF produced •175 operators Tinker, 2008 Barnett Play annual production rate 200 600 400 Year 0 1985 1990 1995 2000 2005 Ye a r l y B a r n e t t g a s p r o d u c t i o n ( B c f ) 800 2010 Mitchell (and later Devon) pioneer the play 100 300 500 700 900 3.6% of U.S. consumption Tinker, 2008 Barnett Formation Ten feet of slabbed core from SW Wise Co, Ft. Worth Basin Photo from Steve Ruppel Ft Worth Basin Barnett: • Porosity - 0.5 – 6% • Permeability – in microdarcy range • Fractures are present but cemented with calcite • Gas and oil: • in fractures? • adsorbed on kerogen • in micro & nano porosity? The Barnett Shale-Gas Play of the Fort Worth Basin: STARR Industry Seminar; November, 2006 Tinker, 2008 Orange dots are 50 nm in diameter 50 µm Hu m a n H a i r Shale Gas Pores Blakely Well, 7,111’ 2 µm Areas of higher carbon content SEM from Reed and Loucks SEM of ion-cut surface Tinker, 2008 Top Ten Barnett Operators, 2007 Fort Worth Basin 0 25 50 75 100 125 150 175 200 Devon XTO Chesapeake EOG Encana Burlington/C-P Range Denbury J-W Chief 2007 production through August, BCF Source: RRC website BCF, 2007 Tinker, 2008 Ft. Worth Basin 25 mi D U Llano Uplift Producing wells as of 11/2007 Fort Worth Dallas Waco Austin Tinker, 2008 Tarrant Co Completions (2008) Tinker, 2008 Tarrant Co. IP’s past 12 months 0 1000 2000 3000 4000 5000 6000 7000 1 24 47 70 93 116 139 162 185 208 231 254 277 300 323 346 369 392 415 438 461 402 wells with reported IP rates Average: 1.9 million cfd Median: 1.8 million cfd Highest 6.5 mmcfd Tinker, 2008 Tarrant Co 2003-2005 Completions Tarrant Cumul Gas vs IP 0 500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000 3,500,000 4,000,000 4,500,000 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 IP rate C u m u l P r o d Avg IP: 1.3 mmcfd Avg Cumulative Through Nov08: 708 million cf Tinker, 2008 EUR (Estimated Ultimate Recovery) •Median cumulative production for wells completed in 2003 in Tarrant Co: –536 million cf –Nearly all were vertical wells •Median cumulative production for horizontal wells drilled in Tarrant in 2005: –726 million cf –All are horizontal wells Tinker, 2008 Typical Well •1 BCF reserves •Peak rate of 700 mcfd •Decline by year: 50%, 25%, 20%, 10%... •Drilling $1 million, completion $750,000 •G&G $50,000 •Lease cost – variable Tinker, 2008 Performance of Median Tarrant Co Horizontal Well Starts at over 2 million cfd After 1 year, making 643 mcfd (69% decline) Chesapeake Bass 311 B, 545 million cf cumulative production Tinker, 2008 Barnett Fracs •Wells average 3500’ horizontal length; range is 2700 to 4400 feet. •3 to 7 stages, average 4 stages •Total water per fraced well: 2.9 to 5.0 million gallons, avg 4 million gallons •Total sand per fraced well: 1 to 2.8 million pounds, avg 2 million pounds The Barnett Shale-Gas Play of the Fort Worth Basin: STARR Industry Seminar; November, 2006 Tinker, 2008 Barnett Frac Job From Devon Energy, 2006 The Barnett Shale-Gas Play of the Fort Worth Basin: STARR Industry Seminar; November, 2006 Tinker, 2008 Urban Drilling Long Beach