The Periphery of Truth
About Volumetric Evaluation in Oil and Gas Exploration
Most oil/gas companies are using probabilistic mathematics in order to constrain uncertainty and risk, and to estimate volumes and value of undiscovered ‘reserves.’
In a probabilistic approach, all prospect parameters are combined in all possible ways.
Though mathematically correct, this approach delivers a large number of outcomes that do not comply with ‘reality’ (in geo-scientific terms: the cumulative knowledge of how oil and gas fields can be described, and how they originated). In other words: although ranges of potential outcomes may be encompassed, ‘truthful’ outcomes are scattered in a cloud of fake results.
Many of my professional colleagues share my concerns - probabilistic modeling tends to yield highly complex, and equally highly unreliable results. More complexity and opacity does not always stand for accuracy and truthfulness. My personal credo being: the simpler, the better.
Let’s talk some real examples. In several shallow oil fields in Asia, there is a correlation between the length of the oil columns, and the API degree of the oil within the reservoir.
Short columns commonly mean very poor API, and highly viscous oils. There is also an obvious correlation between gross reservoir thickness, and column length. Can we ignore such correlations? Obviously not. Can volumetric evaluation programs cope with interconnected parameters? Some programs may do a better job than others, but building correlations into software is a tricky, if not dangerous task- a procedure, that can affect the regional consistency of evaluation.
If all oil field parameters are treated in separate ways, and combined in all mathematically possible ways, it creates a large number of results. The real geo-scientific realities, however, remain often hidden within a cloud of probabilistic outcomes, and can not be extracted any longer.
Unfortunately, this won’t be the only problem. A reservoir engineers wants to see one, or two scenarios. He cannot do reservoir calculations on an unlimited number of outcomes. The development planner also requires concrete scenarios. He or she needs discrete scenarios to calculate the costs of a platform, and topside equipment. You can’t make a probabilistic purchase order. In short: Probabilistic mathematics may be unsuitable for calculating volumes of oil and gas.
How can we approach the issue of volumetric in a creative and correct way?
Let’s step back for a moment, and let’s look how nature is organized. Nature doesn’t create an infinite number of outcomes. Nature isn’t organized along the lines of lottery mathematics.
- Crystals can be classified in a very few classes.
- There are only some 250 different atoms
- There is a finite number of chemical molecules
You could also cite a more mundane example. Go to a restaurant’s kitchen, and combine all the existing food ingredients under all possible cooking, frying and seasoning outcomes. Only a few dishes will deliver an acceptable taste, and happy customers will come back again.
As we use our good traditional cooking skills to obtain a dish that fulfills our wishes, we should equally drop lottery mathematics and approximate our target with tools we better understand: earth science.
Let me at this point introduce a concept, which I developed over the last years in search of a sound and pragmatic volumetric appraisal line of thought. It is called ‘Periphery of Truth.’
The basic philosophy being, that we may not be able to find the only truthful subsurface realization (without drilling), but we might find the few discrete possibilities which Mother Nature may have realized. I would like to compare it with a dart board: The red circle in the middle is very difficult to hit; an experienced thrower will, however, be able to hit the periphery of the inner circle quite often.
How does this work in practical terms? Let me give an example.
A prospect, with a complex trapping configuration is identified on seismic. It has a tank surface exceeding 17 square kilometers. A 2000 feet thick wedge of parallel reflectivity is truncated by two (sealing) unconformities and overlain by a listric growth fault. It shows a strong amplitude shut-off, and AvO effect indicative for oil or gas, at some 220 m below crest. It overlays and has drained a proven kitchen, which has yielded plenty of oil and gas charge in a neighboring producing field. A mix of charge is expected.
From the charge point of view, there are two cases that may represent a possible bias of hydrocarbon fill:
- A case with 75% oil fill and 25 % gas for a moderate sealing capacity;
- A case with 25% oil fill and 75% gas for a poor sealing capacity.
The prospect also lies in the area of the palaeo-shelf edge. Regional correlation is poor due to structural complexity, but two well-calibrated facies types are recognized.
- The topset facies has a net-to-gross distribution of 50-65 %, and average porosities of 25%. Oil recovery above 55%.
- The slope facies only has a net-to-gross of 10-25%, and average porosities of 22 %. Oil recovery only 25%
What we see here are two end-member scenarios for charge/seal realization, and two end-member cases for reservoir development. We can now combine the two end member charge scenarios with the two end-member reservoir scenarios, under the assumption that the amplitude-shut offs indicate the length of a potential hydrocarbon column. Four scenarios are calculated with their individual volumetric scope, using one bulk rock average volume to start with.
1. 75% oil/ topset = Recoverable 450 mmbbls oil, some gas
2. 75% gas/topset = Recoverable 1.2 TCF gas plus some oil, condensate
3. 75% oil/slope= Recoverable 31 mmbbls oil, some gas
4. 75% gas/slope= Some gas plus some oil, condensate
We can now assign a subjective weight to these ‘technical success’ scenarios, by reviewing critical parameters.
· The fault overlying and sealing off the prospect seems to form a pressure boundary – seismic velocities are a bit lower under the fault;
· Within seven kilometers from the prospect, there are indications that this fault has leaked and produced a chimney effect. It suggests that the fault right now holds as much as it can back, but may have vented gas off.
· A seismic comparison indicates seismic facies similarity between the supposed prospect’s reservoir section and two calibration wells nearby.
Given these prerogatives, I’m assigning a chance factor of 40% for success scenario 1, 30 % for scenario 2, 20% for scenario three, and 10 % for scenario four. This leads to a success number of 200 mmbbl, which may be used for accounting or ranking purposes, but doesn’t represent any scientific reality.
With the accountant being happy already, the engineers can use the four scenarios to develop an appraisal and development strategy. Knowing that these won’t represent the truth, they indicate though the overall subjective value of the prospect – The Periphery of Truth.
Where does this lead us? Improving exploration success does not depend on fancy black boxes or computer programs, but instead on a sharp, solid and waterproof exploration logic combined with experience.
©2004 by Franz L Kessler
Best regards,
Leland