Baker Hughes Log Interpretation Agreement Agreement

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					HA-HZ SIG Minutes


    High-Angle and Horizontal Well Special Interest Group (SIG) Meeting
                              March 29, 2006
                             Hosted by: Baker Hughes Inc.
                             2001 Rankin Road, Houston, Texas

 HA/HZ SIG Objective: The HA/HZ SIG is devoted to help the petroleum community (Geology,
 Geophysics, Formation Evaluation, Drilling, Reservoir Engineering) understand the challenges
    associated with the acquisition, interpretation, and integration of HA/HZ wellbore data.

HA/HZ SIG STEERING COMMITTEE MEMBERS:
   • Co-chair - Quinn Passey – ExxonMobil
   • Co-chair - Terry Quinn – Baker Hughes INTEQ
          o Jeff Brami - ExxonMobil
          o David Byrd - Devon
          o J. B. Clavaud - Chevron
          o Jim Klein - ConocoPhillips
          o Robert Lieber - BP
          o Jim Oberkircher - IADD
          o John Rasmus - Schlumberger
          o Ed Stockhausen - Chevron

  9:00      Welcome, safety, and ice-breaker – Terry Quinn and Quinn Passey

  9:20      Business – Terry Quinn
                   - 1yr and 5 yr goals/objectives
                   - What’s not planned to be covered
                   - Discussion of proposed direction

  10:00     Topic A - Drilling (Focus on Depth Control)
            - Invited talk (Andy Brooks) – 20 min
            - “Depth – the Primary Logging Measurement” (Jerome Truax) – 10 min
            - “MD versus TVD and TST” (Hezhu Yin ) – 10 min
            - “Depth Control in HA/HZ Wells” (Dale Fitz) – 10 min
            - Discussion for Topic A – 40 min (including a 10 min break)

  11:45     Lunch

  12:30     Topic B – Formation Evaluation (Focus on Porosity)
            - Invited talk “Thin beds and HZ wells” – Ed Stockhausen – 20 min
            - Solicited talk B-1 (TBD?) – 10 min
            - Discussion for Topic B – 15 min

  13:20     Breakout session. Each group to briefly flag issues related to A) Drilling, B)
            Formation Evaluation, and C) Geologic Modeling and Visualization; one additional
            group met to discuss developing examples/cartoons of unusual log response in
            HA/HZ wells.

  14:20     Report out from groups (10 minutes each)

  14:50     Final business and selection of next meeting date and location.

  15:00     Adjourn




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HA-HZ SIG Minutes

                                       Meeting Minutes

Attendees: Approximately 75 people attended (attendance list available from co-chairs if needed)

Terry Quinn provided an overview from the SIG Steering committee with recommended
directions and objectives for the SIG. The material presented by Terry was developed during a
2/1/06 meeting of the Steering Committee. Below is a summary of Terry’s presentation.

Potential Topics & Issues for the SIG &/or Future Meetings
       Ethics, SEC booking of reserves
       Huge financial impact     economic impact
       Value proposition - need to use the same language throughout industry
       (e.g., what is a high-angle hole, what is a horizontal wellbore,
       what is an interpretation problem, etc.)
       Agreement of issues and definitions
       Current tools versus building new tools
       Break into committees at SIG meetings to discuss more details
       Interpretation in measured depth (MD) versus TVT or TVD
       Compile a set of cartoons/examples to communicate definitions and issues to
       wide audience (FE, drillers, modelers, geologists, reservoir engineers)
       Do we understand the uncertainty?
       - Need to communicate state of understanding to Geoscience Community

What Will One Year Bring? What Do We Want to Do?
      Communicate log response issues to everyone involved in HA/HZ
      (too ambitious?)
       Compile log response chart
              - Post on Website
              - Impact of chart could be huge
              - Example book - provide in electronic format
              - Could contain video and animation
              - Geosteering packages already exist
      Specific problems - Define (e.g. porosity, separation of geologic vs. geometric)
      Solutions (e.g. back ream to remove cuttings beds before logging)
      Develop common nomenclature
      Applications guidelines    best practices in five years
      Communicate to other groups (e.g., ISCWSA (Industry Steering Committee for Wellbore
      Survey Accuracy))
      Ask Resistivity SIG to solve specific EM response issues in HA/HZ wells?
      Develop a learning community - active in finding solution

Where Do We Want to Be Five Years from Now?
      Reprint volume of relevant papers (compilation)
      Provide ‘Best Practices’ for topics A, B, & C
      Ultimately want to be able to have confidence in HA/HZ interpretation of reservoirs
      - when only HA/HZ wells are involved; or
      - how to mix types of data from vertical and HA/HZ wells
      HA/HZ SIG will still be active ⇒
      - Discussion of new tools
      - Applications to new plays (e.g., unconventional reservoirs using HA/HZ)
      Don’t ignore published literature (perhaps one SIG member could compile a
      bibliography and distribute or post on web)




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HA-HZ SIG Minutes

Issues Steering Committee Thought the SIG Should Avoid in the First Year
       Production logs (maybe in years 2-3)
       Cased hole logs (maybe in years 2-3)
       Completion designs
       Seismic interpretation
       Dynamic flow simulation
       Pressures (at least in the next year)
       BHA/motor designs

Steering Committee Points of Discussion for this SIG Meeting
       SIG Steering Committee to review 1 yr and 5 yr nominal goals and objectives
       Obtain consensus on the three general topics (A= Drilling related, B= FE related,
       C=Modeling/Visualization related)
       Form subgroups (A, B, C) - or is this too many layers?
       Do we really want to break up into smaller groups?
       Review what we do not plan to include (over the next 1 year);
       What additional topics should SIG focus on? (Last Slide)

What Will One Year Bring? What Do We Want to Do?
      Communicate log response issues to everyone involved in HA/HZ
      (too ambitious?)
      Compile log response chart
              - Post on Website
              - Impact of chart could be huge
              - Example book - provide in electronic format
              - Could contain video and animation
              - Geosteering packages already exist
      Specific problems - Define (e.g. porosity, separation of geologic vs. geometric)
      Solutions (e.g. back ream to remove cuttings beds before logging)
      Develop common nomenclature
      Applications guidelines    best practices in five years
      Communicate to other groups (e.g., ISCWSA (Industry Steering Committee for Wellbore
      Survey Accuracy))
      Ask Resistivity SIG to solve specific EM response issues in HA/HZ wells?
      Develop a learning community - active in finding solution

Discussion related to Terry Quinn’s presentation:
What to avoid 1st year
    • Dynamic flow/completion/pressure all related
    • Literature compilation
    • Look at SPE for completions discussion
    • Move pressure to year 1 goals (possibly a best practice)
    • Compile master list of what we want to look at (for completeness in case we’ve missed
        some topics)
    • Designing drilling vs. post-drilling evaluation
    • Good design of SIG so SIG not short lived
    • Focus on interpretation side and geosteering
    • Need to add production
    • Perception that we are just doing well construction is too limiting
    • Could split into subgroups to address specific topics

1-year plan
    • Missing “depth” as a continuing topic



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HA-HZ SIG Minutes

    •   Are we after problems or solutions, or both
    •   Set of problems should be of general/broad interest – where can we add most value; we
        don’t want to focus on issues where only 3-4 people in the world care.
    •   Why logs getting off depth - intrasensor depth control
    •   HA/HZ in the middle of various disciplines; definite value to staying together

Andy Brooks gave an overview of the SPE working group for MWD depth control (the ISCWSA).
He summarized data published from several SPE papers, specifically: 1) SPE 67616 (2000)
Accuracy for Directional MWD, 2) SPE 90408 (2004) Prediction of Wellbore Position Accuracy
When Surveyed With Gyroscopic Tools, and SPE95611 (2005) Quantification of Depth Accuracy.
His presentation discussed a) basic stretch corrections, b) depth problems, c) depth QC, d)
depth-time correlation, e) reducing depth uncertainty, f) TVD uncertainty, g) reducing TVD
uncertainty. Sources for additional information include www.iscwsa.org and www.spe.org. His
key point to ponder:
    • Driller’s depth contains significant bias - but there is a reluctance in industry to move
        away from driller’s depth
    • Inclination is a major contributor to TVD error in HA/HZ wells
    • The ISCWSA uncertainty study does not include gross errors (blunders)
    • The next meeting for the ISCWSA will be at the SPE ATCF in San Antonio on September
        28. This is an open forum and interested HA/HZ SIG participants are invited to
        participate.

Jerome Truax discussed four parts of depth error. He commented that although depth is the
primary measurement, his observation is that much of the industry comments on depth QC is just
lip service. Often field practice is to ‘just stretch out the depth to match the pipe tally’, or it is
something that the log analyst can fix it later. The four reasons for bad depth include: 1) gross
error in pipe count, 2) macro error where one logging tool is off relative to another, 3) micro error
such as where the near density detector is off depth relative to the far detector, and 4) nano
errors probably related to bit chatter and tool flexure. He recommended that as an industry we
should do it right at the start. Possible incentives to help would be to tie log quality to field job
bonus, make field engineer correct his/her own mistakes, tie depth control to service company
revenue, and develop and enforce industry standards.

Hezhu Yin discussed that probably the most important measurement in highly deviated wells is
depth. He demonstrated that at high angles (e.g., >80°) even slight errors in relative bed dip of 1-
3 degrees can results in huge errors in TVT (true vertical thickness) and TST (true stratigraphic
thickness). These values go into modeling the log response for determination of hydrocarbons in
place, and ultimately may impact reserve calculations. Dip and TVT are coupled and
interdependent. In most cases we know measured depth (MD), but rarely do we know TST
and/or accurate relative dip between the wellbore and the formation. Many times we assume we
know more than we actually do. Care must be exercised to ensure we are modeling correctly.

Dale Fitz presented a talk first given at an SPE workshop on “Depth Control in HA/HZ Well”. He
discussed the various causes of uncertainty in wireline depth, coiled tubing depth, driller’s depth,
and casing depth. He showed examples of how erroneous depth could result in selecting wrong
interval to perforate, and how in some cases the various logging curves do not line up. His key
points were:
     • Do not adjust driller’s depth when any measure point from an LWD tool string is in
         reservoir rock.
     • Keep complete LWD data versus time files and the time-to-depth files.
     • Keep detailed record of all movements of drill string and all places where driller’s depth
         may have been adjusted (especially in ‘Remarks’ section of log header).




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HA-HZ SIG Minutes

    •   Always check LWD data versus depth against cased-hole wireline or coiled tubing
        perforation depth control logs.
    •   Always review logs with logging engineer if possible.
    •   Most accurate depth is obtained when there is good communication between all team
        members.

The floor was opened for a lively discussion of these presentations. The value of having a
defined set of terms would be useful (e.g., TVD, TST, and TVT). It was noted that the July-
August 1987 issue of the The Log Analyst contains the basic trig used in converting between
many of these depth systems. Post-well surveys are often at discrete intervals, which don’t
necessarily reflect the true trajectory of the well; continuous wellbore surveys should help. It was
questioned if our industry has actually ‘gone backwards’ by adopting new technology rather than
adopting best practices.

Ed Stockhausen presented examples of where thin beds appeared to be accurately
characterized by the density tool in a high angle well (lots of high frequency chatter in the
deviated well log response that was not observed in a nearby vertical well). The density values
from a nearby vertical well appeared to smooth out the data and not “see” the thin beds.
Presumably, good density values were achieved in the highly deviated well because both the
source and detector were located within the same thin bed for a substantial distance because of
the low relative dip (a high angle well in a horizontal bed). In the vertical well, the source and
detector could be in different beds, thus smearing the response. He wondered if the horizontal
well density data were more representative of the formation, and if so, what does this do to the in-
place volumes? He raised questions about the correct way to average data from different tools,
and commented that often it is difficult to get both the gamma-ray and density curves lined up in a
high-angle (60°?) well. For bed dip, he noted that errors in azimuthal systems translate into
significant errors in apparent dip.

Again a lively discussion ensued. It was mentioned that for wireline density tools, the
measurements are compensated for mudcake, but for LWD, the measurements are generally
only compensated for drilling mud. In general service companies probably do not compensate for
thin bed correctly. Density images are a great tool, but need to recognize they are not fully
compensated. Also, since the image does not represent bed boundaries at the borehole surface,
there could be errors in actual dips calculated. Paul Boonen volunteered to compile a
bibliography of HA/HZ articles to share with the SIG – see action items at end of Minutes

Four Breakout groups [3 groups discussed same topics: a) General Direction of SIG, b) List of
Potential Deliverables, and c) Topics for the next SIG meeting. 1 additional group addressed
HA/HZ log workbook examples]. Summaries of the flipchart from each group are provided below.

Group A
General direction
     • Depth control,
     • Density porosity
     • How to stay focused if we bring in other disciplines
     • FE is between driller/reservoir engineer; need their opinions
     • Chart - useful neutron, density off depth
List of Topics/deliverables
     • Drive other societies - joint topical conferences (SPE/SPWLA)
     • Integrated platform (FE centric)
     • Specific sessions
     • N/G, Sw, visualization
     • SPE standard depth - should we push for it



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HA-HZ SIG Minutes

    •   Need to address a more diversified audience since we have only ~1 day/year
    •   Come out with a dictionary of depth terms
    •   We should invite the other SIGs (resistivity, nuclear) to give presentations
    •   How to keep track of connections (?) to lag
    •   Same depth conventions should be used by all service companies - SIG can forward to
        OPCOs recommended practices
   • Depth match/methods, etc. (Education)
   • Collect list of SIGs
Topics for future meetings
   • Dip uncertainty? Final effect on OIP
   • Ask nuclear SIG what they are doing
   • Image log
   • Depth measurement/modeling

Group B
Direction
    • Drilling, geology, petrophysics, visualization, reservoir simulation, production logs (but
        later)
Issues
    1) HA/HZ log planner, measurement, economics, sigma, examples
    2) Tool response, VR, radial GF, azimuthal, bed thickness
    3) Workflows (optimize, strengths) real time, memory, petrophysics, reservoir
        characterization, vertical vs horizontal, net pay, reserves.
    4) Cuttings transport; bring in other disciplines, invite speakers, mud design
    5) Depth - undulations, dip uncertainty, time viewer for data to QC data, solve problems,
        time lapse interpretations
    6) Geomechanics - preventative measures
    7) Definitions - define, publish, present
Next SIG
    • Net pay (SPWLA conf)
    • SPWLA Nuclear SIG updates
    • Petrophysical workflow examples
    • Cuttings transport (Univ Tulsa)

Group C –
   • Focus II - define issues of HA/HZ wells
   • Invite cooperation and consolidate results from specialist groups
   • Draw in other disciplines
   • Define value of addressing issues of HA/HZ wells
   • Coordinate SIG meeting with IADD convention (e.g., in 2/07)
SIG topics
   • Directional drilling impact on HA/HZ
   • HA/HZ impact on reservoir engineering


Group D - Examples/cartoons illustrating logging tool

Sub-Committee members (who participated on 29 March, 2006):
  Jeff Brami       ExxonMobil               Art Schnacke    ExxonMobil
  Paul Boonen      Pathfinder               Michael Manning INTEQ
  Wol Chaffe       PARADIGM                 Rich Hardman 6FF40
  Dave Hinz        Halliburton              Robert Gales    Weatherford
  Shinichi Sakurai OXY                      Ian Zhang       Shell



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HA-HZ SIG Minutes

  Zhiqiang Zhou      Baker Atlas
Problem description:
    I.     Why do we want to create a collection of tool responses in HA/HZ wells?
               • Vertical well formation evaluation models may not apply to HA/HZ wells.
               • Pre-drill modeling for HA/HZ wells will reduce ‘surprises’ while drilling and
                    provide a template for expected responses in a new environment. This also
                    provides an easier template to follow when geosteering, because the
                    predictive model will be similar to the actual response in the HA/HZ well.
               • Reserves estimation will be more accurate.
               • Quality-control of basic data will be better; HA/HZ effects on logs will be
                    distinguished from sensor problems.
               • Drilling-optimization can benefit from awareness of tool responses due to
                    unique sensor responses (bit whirl, BHA harmonics, bit bounce, etc.) Impact
                    of drilling practices on log quality can foster teamwork between drilling &
                    petrophysics. Stacking weight on bit doesn’t necessarily translate to
                    movement downhole.
    II.    How will we do this?
           • Draw typical responses, examples, and/or cartoons (scenarios describe logging
               environment & likely response for various tools; cartoons will have a
               simple/consistent format.
           • Develop simple computer models to illustrate some common responses; add
               complexities in a stepwise fashion.
           • Develop a consensus on definitions for common responses & terms in HA/HZ
               wells (i.e. – what is a HA/HZ well? What’s relative inclination? Dip?
           • Describe mechanical impacts of HA/HZ wells.
    III.   What information is currently available?
           • Pathfinder has charts.
           • Hardman & Shen paper in July-August 1987 SPWLA Log Analyst.




Action Items:
    • Paul Boonen to compile a bibliography of HA/HZ articles to share with the SIG - his
        request was sent to the SIG distribution list on 3/30/06.
    • The next meeting for the ISCWSA will be at the SPE ATCF in San Antonio on September
        28. This is the SPE group tasked with developing industry standards for depth control.
        HA/HZ SIG members are encouraged to attend, if interested in depth control issues.




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HA-HZ SIG Minutes

   •   The HA/HZ ‘log chartbook examples’ subcommittee was planning to meet or interact prior
       to the next SIG meeting.

Next Meeting:
   • Next meeting: Approximately 6 months from this SIG’s date
   • Tentative host organization: Chevron

       What Went Well with SIG Meeting                     What Would You Change
Focal point talks                                Expand single topic instead of two topics
Food                                             Slides available where possible
Facilities                                       Parking
Shuttles from parking lot
Feedback from 3 groups on same topic




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