May 1998 Vol. 219 No. 5  Drilling

J. John Grow,  Engineering Editor

Leading edge technology taking us into the 21^st century

Today we have drilling with casing, coiled tubing and low-cost short radius horizontal drilling, for leading edge technology to take us into the 21^st century.

It appears that nothing can be done to control the price of a barrel of oil, a general consensus of most literature crossing my desk. In addition, the Asian flu affecting the world economy, especially Japan and the U.S., is certainly not helping oil industry woes. Lagging demand and rising stocks continue to pressure global oil markets, and there is little relief on the horizon, according to the Energy Information Administration (EIA) in its March market report. Petroleum prices on U.S. and world markets mostly continue to decline, with notable exception of spot gasoline. Apparent discord among OPEC members, along with United Nations efforts to help Iraq increase "oil-for-food" production, allowed crude oil prices to continue their six-month slide to their lowest levels in nearly ten years.

From another side, look at our oil commodity. Recoverable known oil reserves are finite, and best estimates for replacing them are not optimistic. Some are predicting that by 2010, we will reach the crest of recoverable world oil reserves. Declining production rates will soon follow; demand will continue but at a much greater price. The exact year is, of course, irrelevant, because it is a known fact that naturally occurring elements are irreplaceable commodities. But then, our sun is going to burn itself to a cinder someday, and life as we know it will cease to exist; scientists can also predict an approximate date for this occurrence.

Significant oil discoveries have, to date, been sufficient supplies for our world energy needs. New discoveries of oil, or an acceptable energy replacement, must be pursued. Engineers must devise an efficient means of extracting those resources for humankind's use.

With that said, and keeping our heads out of the sand, look to technology and reducing drilling costs to best utilize our current economical energy resource.

Drilling with casing could reduce drilling costs. Drilling with casing, if perfected, could reduce drilling costs. With the goal of eliminating the use of drill pipe and time spent on unscheduled drilling events such as sidetracking, reaming and backreaming, casing drilling could have a significant impact on how oil and gas wells are currently drilled. Casing drilling is a high-risk, high-return research and development project spawned from continuous-coring research done in the late 1980s by ARCO R&D.

The first casing-drilling test well should spud mid-April at Tesco's R&D center in Calgary, Alberta. A specialized casing-drilling rig has been constructed and prototype downhole tools have been designed and fabricated. Testing and development of the casing-drilling process is likely to proceed into 1999. About 80% of the original $5 million of joint venture investment in the project has been expended.

Tesco manufactures top drive units, has R&D efforts commercialized in the area of underbalanced drilling, and has continued development of the casing-drilling project.

Low-cost short radius horizontal drilling technology. Horizontal Ventures, Inc. announced that it has succeeded in applying its low-cost, short radius horizontal drilling technology to economically recover oil and gas from declining production wells at the Cat Canyon basin field, California.

Two of three planned wells have been successfully drilled, each in a different geological location, within phase-one of a four-phase program. Total horizontal displacement ranged from 400 to 500 ft each, with a short radius of 60 ft.

A target production rate of 500 bopd has been set for the 1998 Cat Canyon basin drilling program. The first wells indicate that previously abandoned oil and gas due to declining production could be economically recovered, and a second three-well program is expected to begin in the second quarter, followed by a third and fourth.

Horizontal Ventures is an oil and gas exploitation and production company focused on exploiting declining production wells by applying a low-cost, short-radius horizontal drilling technology, developed by Amoco, to significantly boost production rates.

Coiled tubing drilling, reduces costs / increases efficiency. Coiled tubing drilling holds promise for reducing costs and increasing efficiency. Gas Research Institute (GRI) has actively supported efforts to accelerate the application of coiled tubing (CT) technologies, particularly where they can reduce natural gas production costs. Among other advantages, coiled tubing drilling holds promise for reducing costs and increasing efficiency in developing low pressure and marginal gas reserves through small-diameter, underbalanced drilling.

In the mid-1980s, significant improvements were made in CT manufacturing and in understanding its mechanical properties and limitations. These advances improved reliability and stimulated CT application expansion. Because CT services are often more economical than snubbing, slickline or conventional workover services, the oil and gas industry downturn of the late 1980s and early 1990s benefited CT technology, as cost-cutting operating companies searched for more economical solutions to their workover problems.

During the 1985 – 1995 decade, manufacturers continued to make improvements in CT quality and size. GRI, along with joint industry participation, aided in improvements by funding research that improved understanding CT welding processes and thus weld reliability.

Copyright © 1999 World Oil
Copyright © 1999 Gulf Publishing Company