FRAC FLUIDS AND WATER USAGE Evaluating The Commercial Viability and Success In Using Water-Free Fracs
Overview of Presentation BlackBrush Oil & Gas Natural Gas Liquids (NGLs) as frac fluid. Advantages and limitations of using NGLs as frac fluid Well flowback design & operations Case Study of wells stimulated with NGLs vs Water fracs 2
BlackBrush Oil & Gas BlackBrush is privately held and was formed in 2004. BlackBrush is located in San Antonio, Texas BlackBrush operations are primarily in South Texas Over 130,000 net acres Operates over 200 wells Current operated production of 10,000 BPDe Very active drilling and completion program 200 plus employees including affiliates 3
BlackBrush Oil & Gas BlackBrush development plans utilizes horizontal, multi-stage completions. All are oil plays. Pearsall Shale Buda Eagleford Austin Chalk San Miguel Olmos 4
GasFrac Technology NGLs - propane, butane, and pentanes gelled using a patented system allowing the fluid to carry proppant. Fluids are handled in pressurized vessels. Proppant blender is pressurized. Safety systems, including LEL, thermal cameras, and Nitrogen system utilized to ensure safe operations 5
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Safety Closed, pressurized system Nitrogen used to maintain pressure throughout operations No exposure to atmosphere Extensive monitoring equipment LEL sensors (lower explosive limit) Cameras (visible spectrum and thermal) Pressure transducers Hazop reviews (Hazard and Operability) Extensive hazop reviews have been performed internally and with expert third-party consultants Hot zone No people are in the hot zone during pumping operations 11
Advantages of NGL frac Provide energy to help lift frac fluid and reservoir fluids. It does this while also remaining in liquid phase while treating the well. Does not cause clay swelling. Maintains higher relative perm for oil but not water wetting formation Low surface tension helps during flow-back NGL viscosity is.08 cps versus.66 cps for water Larger effective frac length vs water Require less pressure drive to move fluid. 2000 psi to move water vs 200 psi for NGL for a formation with a perm of.005md Eliminates cost of obtaining, treating and disposing of water. 12
Limitations of Gas Frac vs Conventional Water Frac Job size proppant and fluid volumes Pump rate Wellbore configuration open-hole packers vs. plug and perf Logistics of NGL delivery Frac fluid availability Less forgiving system 13
Propane Flowback Line heaters added to keep propane in the gas phase and out of the oil tank. Options for handling propane Deliver directly to pipeline high pressure lines take special considerations Use of JT or refrigeration gas plant to remove propane Use of blending in natural gas to reduce percent of propane in gas stream. Must be able to recover propane as it is cost prohibitive to flare propane during flow-back. 14
NGL Phase Diagram 650 600 550 500 450 400 350 300 250 200 150 100 50 0 15 Pressure (PSIA) NGL Liquid Phase -50 0 50 100 150 200 250 300 350 400 Temperature ( o F) NGL Gas Phase NGL Mixture Propane 50% i-c4/50% n-c4
Modified Flowback For C4+ Fluid Goal is to keep recovered fluid in the liquid phase Blend with lease oil into pressurized frac tanks to keep stable Blended product is transported and sold as oil Residual or flash gas from separator is sent to sales Virtually 100% recovery Minimizes flowback equipment and reduces flowback time/cost. Compressing into a high pressure sales lines is no longer an issue 16
Case Study Formation Depth 3,750 ft Bottom-hole pressure of 1650 psig (.44 psi/ft) Bottom-hole temperature 140 degree F Tight oil sand gross pay of 90 ft, high porosity pay section of 27 ft. Perm of.05 -.10 md Water saturation of 45% Oil gravity 45 degree API, Gas is over 8 gpm Field has over 200 vertical wells. Average IP of 15 bpd and EUR of 15 Mbbl. 17
Comparison of Water & NGL Fracs Water NGL 4,797 bbls per stage 1,233 bbls per stage 85,569 lbs. per stage 66,454 lbs. per stage Frac gradient.94 psi/ft Frac gradient.96 psi/ft Treating Rate 66 BPM Cost per stage of $115M Treating Rate 42 BPM Cost per stage of $165M Expected Future Cost per stage $87M 9 stages per well 18 9.5 stages per well
Average IP Rate 700 600 604 500 400 375 300 200 100 0 Avg. IP watr frac BPDe Avg. IP NGL frac BPDe 19
Average IP per stage 70 64 60 50 40 41 30 20 10 0 Avg. IP per stage water frac BPDe Avg IP per staqge NGL frac BPDe 20
Cumulative BOE vs Time 40000 35000 30000 25000 20000 15000 10000 5000 0 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 Avg. Cum. BOE Water frac Avg. Cum BOE NGL frac 21
Cumulative BOE vs Time 14000 12000 10000 8000 6000 4000 2000 0 0 5 10 15 20 25 30 35 Avg. Cum. BOE Water frac Avg. Cum BOE NGL frac Avg. Cum BOE Butane Pentane frac 22
Rate vs Time 700 600 500 400 300 200 100 0 1 31 61 91 121 151 181 211 241 271 301 331 Avg. Rate water frac BPDe Avg. Rate NGL frac BPDe 23
Flowing Tubing Pressure 800 750 700 650 600 550 500 450 400 350 300 250 200 150 100 50 0 24 On gas lift 1 31 61 91 121 151 181 211 241 271 301 331 Avg. FTP Water frac psig Avg. FTP NGL frac psig
Pump and fluid costs vs. 90 day cum BOE 80 70 60 57 $/90 day Cum BOE 50 40 30 45 24 20 10 0 Water Cost NGL Cost Future NGL Cost 25
Buda formation well Rate vs Time BPDe 700 650 600 6 stage gas frac 550 500 Open-hole completion 450 400 350 300 250 200 150 100 50 0 1 6 11 16 21 26 31 36 41 46 51 56 61 BPDe 26
1600 Buda formation well Flowing tubing pressure 1500 1400 1300 6 stage gas frac 1200 1100 1000 Open-hole completion 900 800 700 600 500 400 300 200 100 0 1 6 11 16 21 26 31 36 41 46 51 56 61 Tubing Pressure 27
Conclusion Use of NGL fracs has greatly increased reserve recovery for oil formations. Future use of Butanes and Pentanes mix will greatly reduce the net cost of NGL fracs. Continued added infrastructure will reduce costs of NGL fracs. NGL fracs should make many of the normal pressure oil windows in shale plays viable. NGL fracs eliminate the problems associated with water fracs. BlackBrush plans to continue to utilize GasFrac in current areas and expand the technology in other formations 28