June 2002 Supplement  Case Study

Rod-pump controllers profitable in East Texas operations

H. Pete Berg, Stetson Petroleum Corp., Denison, Texas; and Karl Sakocius,  *   eProduction Solutions, Houston.

Bottom line. Stetson Petroleum Corp. purchased and installed rod-pump controllers, replacing time clocks, in 15 wells in its East Linden (Cotton Valley) field in East Texas. Wells there are about 10,000-ft deep, producing 42 to 46°-API gravity oil, with a 5 to 50% watercut. With contract pumpers, timers and a trial-and-error process for setting timers, Stetson saw upside potential from using rod-pump controllers (RPCs). Based on two years’ experience, it found that the controllers reduced rod and tubing failures by 31% and electric costs by 40%, equating to about $50,000 per year savings. RPC equipment costs paid out in less than a year, on average.

Problems with prior timers. Stetson uses contract pumpers. Before installing RPCs, problems were identified during daily visits. Timers were utilized for intermittent operation and, unfortunately, the pumpers could not evaluate the cyclical status of the wells from just a single visit every 24 hr. They would, consequently, set the timers based on a series of trial and error adjustments. At times, they would pump the well (manually) by turning the pump control to "hand" to establish a base line. Many times, since the pumpers only visited the wells once per day, they would leave them running in the hand mode for 24 hr. Results were that some wells were pounding fluid for a considerable period of time.

Another problem was under-pumping the wells. At 10,000 ft, pump efficiency is impacted considerably due to rod stretch. On certain wells, the timers were set for as little as 3 hr/day. During the well’s idle time, gas would break out of the fluid in the tubing, and extra pumping time would be required to return the liquid level in the tubing to surface where production could be "put in the tank." This extra pump-up time was not consistent and, combined with decreased pump efficiency due to pump wear over time, resulted in additional complications with trying to estimate the time required to produce the wells efficiently with a time clock.

Benefits of rod-pump controller selection. Stetson started looking for progressive ways to improve production operations that would pay out in a reasonable time period. It was interested in RPCs early on, but was deterred by the price of state-of-the-art technology. It did not want to compromise load and position technology for controllers based on amps changes or motor speed. CAC RPCs from eProduction Solutions (eP) were selected as the solution, Fig. 1. The controllers eliminated a lot of guessing. Rather than the inefficient method of trial and error for adjusting the time clocks, the RPC immediately shuts down on pump-off and adjusts the idle time based on buffered data in the controller from past cycle times.

Fig. 1. CAC 2000 rod-pump controller.

One benefit of RPCs is the significant reduction in rod parts. Fig. 2 illustrates savings from the reduction in rod failure frequency and tubing repairs. This is significant, because avoiding one rod-part repair that costs $3,000 to $4,000 alone pays for an RPC. Another savings was on wells that did not have vibration sensors, and the belts would burn off the electric motor when a well had a shallow rod part. Using the RPC shut the well down on a low-load limit and saved the belts. Overall, the operator has seen a 31% reduction in pulls from rod parts and tubing failures. Additionally, electrical costs have been reduced by 40%. This resulted in a savings of more than $50,000 per year.

Fig. 2. Observed savings in two major rod-pumping operational costs in East Texas field.

Rod-part occurrences were reduced because of several factors. First, since the pumpers did not need to establish a base line by over-pumping the well and pounding the fluid, wear and tear on rods, tubing and pumps was significantly decreased. Reducing the number of rod parts also decreased pump wear and tear. When a rod would break, it would slam the traveling portion of the pump into the seat, causing immediate damage or weakening the pump enough to cause failures in the near future. Because of the damage that falling rods create in pumps, Stetson’s policy is to replace pumps when rods are pulled.

Rod part repair / replacement also decreased because the RPCs limited fluid pound to only one or two cycles during regular operation. When the pumps were run on timers, the pumps often ran without fluid until the timers were adjusted properly. Unfortunately, adjusting the timers was done by trial and error, which led to extended periods of fluid pound while the timer was adjusted. Changing well conditions that required repeated timer adjustments further compounded the problem.

Operating the well so that the pump motor only ran while it was actually pumping fluid reduced electrical costs significantly. Generally, electricity is the highest cost in operating a rod-pumped well. Limiting the motor to only pumping fluid, and limiting pump-off provides a significant savings in electrical costs-per-barrel of fluid produced. Basically, the motor is used more efficiently.

Using the controllers assures that the well’s fluid level is dropped to the pump level during each cycle of the run. The lower average fluid level reduces the backpressure from the annulus. The reservoir flows more freely, which allows the reservoir pressure to maximize flow to the well, while minimizing rod / pump damage. For wells that were maintaining a high fluid level, the RPC increased fluid production.

Future plans, conclusions. Currently, the company is relying on pumpers’ reports to make changes in RPC configurations. Its plans for the future are to add communication to the RPCs and add a host-based control and analysis system. Stetson is looking at radio systems for remote well communications – both dedicated-band or spread-spectrum systems are being evaluated. Each has its own set of benefits that need to be measured against the field’s unique attributes. With communications and a host-based control and analysis system, the operator will be able to instantly respond to changes in well conditions and fine tune RPC performance, as well as instantly recognize problems with the wells.

It was concluded that the addition of RPCs in Stetson’s fields has provided additional profits from production operations. Some of that profit, plus the savings in pumpers’ time, can now be employed in other areas which, in turn, further optimizes production and increases profitability. Although the RPCs were paid off within a year for Stetson, capital requirements are still higher than many independents can afford. The supplier of the RPCs, eProduction Solutions, has since instituted a lease program that provides RPCs for as low as $1.99 per well per day. With the lease program, the initial payout is small and the payoff is sooner.  PTD