METHOD FOR DETERMINING A SET OF NET PRESENT VALUES TO INFLUENCE THE DRILLING OF A WELLBORE AND INCREASE PRODUCTION

CROSS REFERENCE TO RELATED APPLICATION [001] This application claims priority to the filing date of U.S. Non Provisional

Patent Application Serial No 12/148415 filed on April 18, 2008, which is hereby incorporated by reference in its entirety.

BACKGROUND [002] The subject matter set forth in this specification relates to a software

(hereinafter called the "NPV Max Software") that is adapted to be stored in a workstation or other computer system, the NPV Max Software being adapted for optimizing or maximizing a Net Present Value (NPV) of a well while drilling and estimating production from a reservoir field while drilling.

[003] The term 'reservoir characterization and optimization of productivity while drilling' means 'the ability to perform reliable interpretations sufficiently rapidly so as to be able to influence major decisions'. An example of such a major decision could be 'how to steer a well being drilled' in order to optimize the productivity and expected ultimate recovery (EUR) from the reservoir field into which the well is being drilled. This specification discloses a 'reservoir characterization and optimization of productivity while drilling' method (including its associated system or apparatus and program storage device and computer program) that will: (1) optimize or maximize the Net Present Value (NPV) of a well while drilling into a reservoir field, and (2) estimate a production from the reservoir field while drilling the well into the reservoir field.

SUMMARY

[003] One aspect of the present invention involves a method of modeling a first reservoir while drilling a wellbore into a corresponding second reservoir, the first reservoir having a plurality of stations, comprising: (a) determining a plurality of values of net present value corresponding, respectively, to the plurality of stations of the first reservoir; and (b) drilling the wellbore into the corresponding second reservoir in accordance with the plurality of values of net present value.

[004] Another aspect of the present invention involves a method for determining an optimum trajectory of a wellbore being drilled into a reservoir, comprising: (a) modeling a corresponding reservoir in a simulator, the corresponding reservoir having a plurality of stations; (b) determining a plurality of net present values corresponding, respectively, to the plurality of stations of the corresponding reservoir; (c) determining, from among the plurality of net present values, a subset of maximum ones, relative to a predetermined threshold, of the plurality of net present values; (d) determine, from among the plurality of stations of the corresponding reservoir, a subset of stations which correspond, respectively, to the subset of maximum ones of the plurality of net present values; and (e) drilling the wellbore in the reservoir along a path which corresponds to the subset of stations, the optimum trajectory of the wellbore being drilled into the reservoir corresponding to the path.

[005] Another aspect of the present invention involves a method of determining an optimum drilling method associated with a drilling of a wellbore into a reservoir, comprising: (a) modeling a corresponding reservoir in a simulator, the corresponding reservoir having a plurality of stations; (b) determining a plurality of net present values corresponding, respectively, to the plurality of stations of the corresponding reservoir; (c) determining, from among the plurality of net present values, a subset of maximum ones, relative to a predetermined threshold, of the plurality of net present values; (d) determine.

from among the plurality of stations of the corresponding reservoir, a subset of stations which correspond, respectively, to the subset of maximum ones of the plurality of net present values; and (e) selecting a drilling method associated with a drilling of a wellbore into a reservoir in accordance with the subset of stations which correspond, respectively, to the subset of maximum ones of the plurality of net present values.

[006] Another aspect of the present invention involves a program storage device readable by a machine tangibly embodying a set of instructions executable by the machine to perform method steps for modeling a first reservoir while drilling a wellbore into a corresponding second reservoir, the first reservoir having a plurality of stations, the method steps comprising: (a) determining a plurality of values of net present value corresponding, respectively, to the plurality of stations of the first reservoir; and (b) drilling the wellbore into the corresponding second reservoir in accordance with the plurality of values of net present value.

[007] Another aspect of the present invention involves a program storage device readable by a machine tangibly embodying a set of instructions executable by the machine to perform method steps for determining an optimum trajectory of a wellbore being drilled into a reservoir, the method steps comprising: (a) modeling a corresponding reservoir in a simulator, the corresponding reservoir having a plurality of stations; (b) determining a plurality of net present values corresponding, respectively, to the plurality of stations of the corresponding reservoir; (c) determining, from among the plurality of net present values, a subset of maximum ones, relative to a predetermined threshold, of the plurality of net present values; (d) determine, from among the plurality of stations of the corresponding reservoir, a subset of stations which correspond, respectively, to the subset of maximum ones of the plurality of net present values; and (e) drilling the wellbore in the reservoir along a path which corresponds to the subset of stations, the optimum trajectory of the wellbore being drilled into the reservoir corresponding to the path.

[008] Another aspect of the present invention involves a program storage device readable by a machine tangibly embodying a set of instructions executable by the machine to perform method steps for determining an optimum drilling method associated with a drilling of a wellbore into a reservoir, the method steps comprising: (a) modeling a corresponding reservoir in a simulator, the corresponding reservoir having a plurality of stations; (b) determining a plurality of net present values corresponding, respectively, to the plurality of stations of the corresponding reservoir; (c) determining, from among the plurality of net present values, a subset of maximum ones, relative to a predetermined threshold, of the plurality of net present values; (d) determine, from among the plurality of stations of the corresponding reservoir, a subset of stations which correspond, respectively, to the subset of maximum ones of the plurality of net present values; and (e) selecting a drilling method associated with a drilling of a wellbore into a reservoir in accordance with the subset of stations which correspond, respectively, to the subset of maximum ones of the plurality of net present values.

[009] Another aspect of the present invention involves a system adapted for modeling a first reservoir while drilling a wellbore into a corresponding second reservoir, the first reservoir having a plurality of stations, comprising: apparatus adapted for determining a plurality of values of net present value corresponding, respectively, to the plurality of stations of the first reservoir; and apparatus adapted for drilling the wellbore into the corresponding second reservoir in accordance with the plurality of values of net present value.

[010] Another aspect of the present invention involves a system adapted for determining an optimum trajectory of a wellbore being drilled into a reservoir, comprising: apparatus adapted for modeling a corresponding reservoir in a simulator, the corresponding reservoir having a plurality of stations; apparatus adapted for determining a plurality of net present values corresponding, respectively, to the plurality of stations of the corresponding reservoir; apparatus adapted for determining, from among the plurality of net present values, a subset of maximum ones, relative to a predetermined threshold, of the plurality of net present values; apparatus adapted for determining, from among the

plurality of stations of the corresponding reservoir, a subset of stations which correspond, respectively, to the subset of maximum ones of the plurality of net present values, drilling the wellbore in the reservoir along a path which corresponds to the subset of stations, the optimum trajectory of the wellbore being drilled into the reservoir corresponding to the path.

[Oi l] Another aspect of the present invention involves a system adapted for determining an optimum drilling method associated with a drilling of a wellbore into a reservoir, comprising: apparatus adapted for modeling a corresponding reservoir in a simulator, the corresponding reservoir having a plurality of stations; apparatus adapted for determining a plurality of net present values corresponding, respectively, to the plurality of stations of the corresponding reservoir; apparatus adapted for determining, from among the plurality of net present values, a subset of maximum ones, relative to a predetermined threshold, of the plurality of net present values; apparatus adapted for determining, from among the plurality of stations of the corresponding reservoir, a subset of stations which correspond, respectively, to the subset of maximum ones of the plurality of net present values, selecting a drilling method associated with a drilling of a wellbore into a reservoir in accordance with the subset of stations which correspond, respectively, to the subset of maximum ones of the plurality of net present values.

[01 Ia] Another aspect of the present invention involves a computer program adapted to be executed by a processor, the computer program, when executed by the processor, conducting a process for modeling a first reservoir while drilling a wellbore into a corresponding second reservoir, the first reservoir having a plurality of stations, the process comprising: (a) determining a plurality of values of net present value corresponding, respectively, to the plurality of stations of the first reservoir, the wellbore being drilled into the corresponding second reservoir in accordance with the plurality of values of net present value.

[012] Further scope of applicability will become apparent from the detailed description presented hereinafter. It should be understood, however, that the detailed description and the specific examples set forth below are given by way of illustration only, since various changes and modifications within the spirit and scope of the 'NPV Max Software', as described and claimed in this specification, will become obvious to one skilled in the art from a reading of the following detailed description.

BRIEF DESCRIPTION OF THE DRAWINGS

[013] A full understanding will be obtained from the detailed description presented hereinbelow, and the accompanying drawings which are given by way of illustration only and are not intended to be limitative to any extent, and wherein:

[014] figure 1 illustrates a computer system adapted for storing a 'Software adapted for optimizing or maximizing Net Present Value (NPV) of a well while drilling and estimating production while drilling', hereinafter called the "NPV Max Software";

[015] figure 2 illustrates a function associated with the NPV Max Software of figure 1;

[016] figure 3 illustrates a detailed construction of the 'simulation data deck' and the 'NPV Max Software' of figures 1 and 2; and

[017] figure 4 illustrates a pressure/pressure derivative comparison with a numerical simulator for a deviated well.

DESCRIPTION

[018] This specification discloses a software (hereinafter called the "NPV Max Software") that is adapted to be stored in a workstation or other computer system, the NPV Max Software being adapted for Optimizing or maximizing the Net Present Value (NPV) of a well' while drilling and estimating production from a reservoir field while drilling. It should be understood that the definition of "optimizing or maximizing the Net Present Value (NPV) of a well" also means ensuring that the total NPV of the field into which it is being drilled is also optimized, and hence that the NPV of the field must (at the very least) not reduce due to the drilling of the well.

[019] The basic 'functions of the NPV Max software 12' are illustrated in figure 2: (1 ) construct and use flow simulations to model the impact of a well being geosteered on future production from a reservoir field into which the well is being drilled, 12a, (2) use the flow simulations to optimize (or maximize) the value of this production by manipulating the drilling methods of the well being geosteered, 12b, and (3) use the data acquired from the well being geosteered to construct the flow simulations and thereby influence the drilling of the well, 12c. Using the method associated with the 'NPV Max Software' disclosed in this specification, the drilling of a wellbore in a real (not modeled) reservoir commences, and, simultaneously, the processor of a computer system (of figure 1) begins to execute the 'NPV Max Software' in order to calculate a value of the 'Net Present Value (NPV)' for each 'station' of a 'modeled reservoir' thereby generating a 'plurality of values of the NPV corresponding, respectively, to the 'plurality of stations of the modeled reservoir', where the 'plurality of the values of NPV corresponding, respectively, to the 'plurality of stations of the modeled reservoir' will aid and assist a 'drilling person or entity' in the drilling of a wellbore in a reservoir. For example, the wellbore's trajectory can be changed while drilling, or the drilling methods used to drill the wellbore can be changed accordingly. That is, the 'drilling person or entity' (when drilling the wellbore in the reservoir) will determine (from among the 'plurality of values of NPV corresponding, respectively, to the -plurality of stations of the modeled reservoir') the stations of the

modeled reservoir which have the Optimum ones' or 'maximum ones' of the 'plurality of values of NPV. The 'drilling person or entity' can then 'geosteer' or change the trajectory of the wellbore (being drilled into the reservoir) in order to follow the stations of the modeled reservoir which have the Optimum ones' or 'maximum ones' (relative to a predetermined threshold) of the 'plurality of values of NPV

[020] The term 'reservoir characterization and optimization of productivity while drilling' means 'the ability to perform reliable interpretations sufficiently rapidly so as to be able to influence major decisions'. An example of such a major decision could be 'how to steer a well being drilled' in order to optimize the productivity and expected ultimate recovery (EUR) from the reservoir field into which the well is being drilled. The 'NPV Max Software' disclosed in this specification practices a 'reservoir characterization and optimization of productivity while drilling' method (which includes an associated system and program storage device and computer program) that will: (1) optimize or maximize the Net Present Value (NPV) of a well while drilling the well into a reservoir field, and

(2) estimate a production from the reservoir field while drilling the well into the reservoir field. As a result, the 'NPV Max Software' disclosed in this specification will optimize or maximize a Net Present Value (NPV) of a well while drilling the well into a reservoir field, and estimate a production from the reservoir field while drilling the well into the reservoir field.

[021] In this specification, it is proposed that 'while-drilling workflows' can be facilitated by combining a 'static near well bore geologic (layered formation) and petrophysical model' with a 'fast reservoir simulator'. A simulation study can be done in advance of the drilling. This predicts a range of well productivities and provides a 'Base Model case' against which one can compare 'updated models'. Then, while drilling, when there are periodic updates at 'stations', a pre-defined workflow is executed which performs modeling to re-generate and launch the 'fast simulations'. Having an 'estimated range of productivities as the drilling proceeds' is extremely useful. In addition, the term 'station' can be defined as a 'time dependent point at which the workflow is executed'. This is a 'virtual station' in the sense that the number of stations and the time dependency is variable

and problem dependent. The information can be used to: (1) stop drilling when the optimal production scenario is reached, (2) eliminate unnecessary costs, (3) evaluate the economic viability of continued drilling in marginal reservoirs, and (4) reduce risk and uncertainty. An Optimal production scenario' is the state of having the 'maximum expected NPV, subjected to a predefined acceptable level of risk. The term 'Net Present Value (NPV)' is a function of the 'expected value of hydrocarbon production, minus the costs of drilling and completing and maintaining the well'. Different trajectories associated with drilling a wellbore in a reservoir field can be simulated in order to evaluate: (1) the impact of the steering plan on the final production from the reservoir field, and (2) the Net Present Value (NPV). As a result, the risks and rewards associated with continued drilling in the reservoir field can be appraised in real time in order to make informed decisions.

[022] The following 'methods or functions, apparatus, and data' are 'pre-requisite to' the 'reservoir characterization and optimization of productivity while drilling' method that is practiced by the 'NPV Max Software' disclosed in this specification: (1) a method or function which will characterize the 'near well bore environment', including layering, (2) an apparatus known as a 'fast fluid flow simulator' for a layered reservoir, and (3) data known as 'diagnostics and history matching formation testing while drilling (Test WD) data'.

[023] Referring to figures 1 and 2, a computer system is illustrated that is adapted for storing a 'Software adapted for optimizing or maximizing Net Present Value (NPV) of a well while drilling and estimating production while drilling (NPV Max Software)'.

[024] In figure 1, a workstation, personal computer, or other computer system 10 is illustrated adapted for storing a 'Software adapted for optimizing or maximizing Net Present Value (NPV) of a well while drilling and estimating production while drilling (NPV Max Software)'. Hereinafter, in this specification, the aforementioned 'Software adapted for optimizing or maximizing Net Present Value (NPV) of a well while drilling and estimating production while drilling (NPV Max Software)' will be referred to as the "NPV Max Software". The computer system 10 of figure 1 includes a Processor 10a

operatively connected to a system bus 10b, a memory or other program storage device 10c operatively connected to the system bus 10b, and a recorder or display device 1Od operatively connected to the system bus 10b. The memory or other program storage device 10c stores the 'Software adapted for optimizing or maximizing Net Present Value (NPV) of a well while drilling and estimating production while drilling (NPV Max Software)' 12 (i.e., the memory 10c stores the 'NPV Max Software' 12) that is adapted for optimizing or maximizing a Net Present Value (NPV) of a well while drilling and estimating production from a reservoir field while drilling. Recall that the 'NPV Max Software' 12 illustrated in figure 1 practices a 'reservoir characterization and optimization of productivity while drilling' method (which includes an associated system and program storage device and computer program) that will: (1) optimize or maximize the Net Present Value (NPV) of a well while drilling the well into a reservoir field, and (2) estimate a production from the reservoir field while drilling the well into the reservoir field. As a result, the 'NPV Max Software' 12 will optimize or maximize a Net Present Value (NPV) of a well while drilling the well into a reservoir field, and estimate a production from the reservoir field while drilling the well into the reservoir field. The computer system 10 receives 'input data' 14 which comprises a 'simulation data deck' 14, where the 'simulation data deck' 14 includes a 'prior data deck', a 'while drilling data deck', and a 'prediction data deck', which is illustrated in figure 3 and will be discussed later in this specification. The 'NPV Max Software' 12, which is stored in the memory 10c of figure 1, can be initially stored on a Hard Disk or CD-Rom, where the Hard Disk or CD-Rom is also a 'program storage device'. The CD-Rom can be inserted into the computer system 10, and the 'NPV Max Software' 12 can be loaded from the Hard Disk or CD-Rom and into the memory/program storage device 10c of the computer system 10 of figure 1. The Processor 10a will execute the 'NPV Max Software' 12 that is stored in memory 10c of figure 1 ; and, responsive thereto, the Processor 10a can then generate either a 'record' or an Output display' that can be recorded or displayed on the Recorder or Display device 1Od of figure 1. The 'record' or Output display' that is generated by the Recorder or Display device 1Od of figure 1, will illustrate or display a "a Net Present Value (NPV) 'NPV = f(WOPT, Ccosts-of-well)' for each station of a modeled reservoir". The term 'station' of a reservoir field can be defined as a 'time dependent point at which the workflow of figure 3 is executed'. This is a 'virtual

station' in the sense that the number of stations and the time dependency is variable and problem dependent. The computer system 10 of figure 1 may be a personal computer (PC), a workstation, a microprocessor, or a mainframe. Examples of possible workstations include a Silicon Graphics Indigo 2 workstation or a Sun SPARC workstation or a Sun ULTRA workstation or a Sun BLADE workstation. The memory or program storage device 1 Oc (including the above referenced Hard Disk or CD-Rom) is a 'computer readable medium' or a 'program storage device' which is readable by a machine, such as the processor 10a. The processor 10a may be, for example, a microprocessor, microcontroller, or a mainframe or workstation processor. The memory or program storage device 10c, which stores the 'Software adapted for optimizing or maximizing Net Present Value (NPV) of a well while drilling and estimating production while drilling (NPV Max Software)' 12 or 'NPV Max Software' 12, may be, for example, a hard disk, ROM, CD-ROM, DRAM, or other RAM, flash memory, magnetic storage, optical storage, registers, or other volatile and/or non-volatile memory.

[025] In figure 2, the 'NPV Max software' 12 of figure 1 functions, when executed by the processor 10a, to: (1) construct and use flow simulations to model the impact of a well being geosteered on future production from a reservoir field into which the well is being drilled, as indicated by numeral 12a, (2) use the flow simulations to optimize (or maximize) the value of this production by manipulating the drilling methods of the well being geosteered, as indicated by numeral 12b, and (3) use the data acquired from the well being geosteered to construct the flow simulations and thereby influence the drilling of the well, as indicated by numeral 12c.

[026] In operation, although a more detailed functional description of the operation of the 'NPV Max software' 12 of figure 1 will be set forth later in this specification, refer now to figures 1 and 2. Recall the 'functions of the NPV Max software 12' which are illustrated in figure 2: ( 1 ) construct and use flow simulations to model the impact of a well being geosteered on future production from a reservoir field into which the well is being drilled, 12a, (2) use the flow simulations to optimize (or maximize) the value of this production by manipulating the drilling methods of the well being geosteered, 12b, and (3) use the data

acquired from the well being geosteered to construct the flow simulations and thereby influence the drilling of the well, 12c. In figure 1 , drilling of a wellbore in a 'real (not modeled) reservoir' commences, and, simultaneously, the processor 10a of the computer system 10 of figure 1 begins to execute the 'NPV Max Software' 12 in order to calculate a value of the 'Net Present Value (NPV)' for each 'station' of a 'modeled reservoir', a plurality of the values of the 'NPV corresponding, respectively, to the plurality of 'stations' of the 'modeled reservoir' assisting (a drilling person or entity) in the drilling of the wellbore in the reservoir; for example, the wellbore's trajectory can be changed while drilling, or the drilling methods used to drill the wellbore can be changed accordingly. When the processor 10a of figure 1 executes the 'NPV Max Software' 12 which is stored in memory 10c, while using the simulation data deck 'input data' 14 (which includes a 'prior data deck', a 'while drilling data deck' and a 'prediction data deck'), the processor 10a of figure 1 will determine (by using the 'flow simulations' which are run and executed by a 'simulator' that is embodied in the 'NPV Max Software 12) one or more 'maximum values of Net Present Value (NPV)' for each 'station' in a 'modeled reservoir' field during the drilling of a corresponding 'real (not modeled) wellbore'. Recall that a 'station' of a reservoir field is defined as a 'time dependent point (along the modeled reservoir field)'. In addition, recall that the term 'Net Present Value (NPV)' is defined to be a function of the 'expected value of hydrocarbon production, minus the costs of drilling and completing and maintaining the well'. The 'Net Present Value (NPV)' is represented by an Objective Function', where, for an oil well, the Objective Function' is further represented by the following equation: 'NPV = f(WOPT, Ccosts-of-well)', where 'WOPT' is the cumulative amount of oil that can be produced from a production steered well, and 'Ccosts-of-well' are the total costs of starting and maintaining production from the well. During the drilling of a real (not modeled) wellbore in a reservoir field, the processor 10a will maximize or optimize the above referenced 'Objective Function' for each 'station' in the 'modeled reservoir' thereby determining 'one or more values of the Net Present Values (NPV)' for each 'station' in the 'modeled reservoir'. When the processor 10a determines the 'one or more values of Net Present Value (NPV)' for each 'station' in a 'modeled reservoir', 'a plurality of net present values' will be determined which correspond, respectively, to 'a plurality of stations' in the 'modeled reservoir'. When the 'plurality of net present values'

are determined corresponding, respectively, to 'the plurality stations' in the 'modeled reservoir', the 'drilling person or entity' can then determine (from the 'plurality of net present values' corresponding, respectively, to the 'plurality of stations' in the 'modeled reservoir') the specific "stations of the modeled reservoir which have the Optimum ones' or 'maximum ones' (relative to a predetermined threshold value) of the plurality of values of NPV". When the 'drilling person or entity' knows which "stations of the modeled reservoir have the 'optimum ones' or 'maximum ones' of the plurality of values of NPV", the 'drilling person or entity' can then: (1) drill and 'geosteer' the wellbore into the reservoir, and/or (2) change the trajectory of the wellbore being drilled into the reservoir in order to follow the "stations of the modeled reservoir which have the 'optimum ones' or 'maximum ones' of the plurality of values of NPV", and thereby maximize the value of the production of oil and/or gas from the reservoir. In addition or in the alternative, the 'drilling person or entity' can change the drilling methods, while drilling the wellbore into the reservoir, specifically in accordance with the 'optimum ones' or 'maximum ones' of the 'plurality of values of NPV, corresponding, respectively, to the plurality of stations of the modeled reservoir, and thereby maximize the production of oil and/or gas from the reservoir. When the wellbore is 'geosteered' and drilled into the reservoir, 'data' is acquired during the 'geosteering' and drilling of the wellbore into the reservoir, and that 'data' can then be used to reconstruct the aforementioned 'flow simulations', which are then subsequently re-run and re-executed by the 'simulator' that is embodied in the 'NPV Max Software' 12 of figure 1.

[027] Referring to figure 3, a flowchart or block diagram is illustrated which provides a more detailed construction of the 'simulation data deck' 14 and the 'NPV Max Software' 12 of figures 1 and 2.

[028] In figure 3, the 'drilling process begins' at step 13. A first 'iteration' or 'station' starts at 'N=F. The simulation data deck 14 includes the 'prior data deck' 14a, the 'while drilling data deck' I4b2 which is derived from 'real time logging while drilling (LWD) data' 14bl, and the -prediction data deck' 14c. The 'real-time logging while drilling (LWD) data' 14b 1 is received when the 'drilling process begins' at step 13. The 'NPV

Max Software' 12 includes a first step: 'Construct a Base Model, Conduct first pass (low simulation, and maximize NPV' 12a. The 'NPV Max Software' 12 also includes a second step: 'Construct/Update Posterior Model' 12b. The 'NPV Max Software' 12 also includes a 'simulator' 12c, the 'simulator' 12c including a first 'history matching' step 12c 1 and a second 'prediction phase' step 12c2. The 'history matching' step 12c 1 further includes a 'Construct Flow Simulation Mode!' step 16. The 'prediction phase' step 12c2 further includes an 'optimize NPV Subject to Cl - ClO & Predict Productivity' step 18. In figure 3, the 'Construct a Base Model, Conduct first pass flow simulation, and maximize NPV step 12a receives the 'prior data deck' 14a and the 'prediction data deck' 14c at 'iteration' or 'station': 'N= 1'. The 'Construct/Update Posterior Model' step 12b receives an output from the 'Construct Base Model...' step 12a at iteration or 'station': 'N=I '; however, in addition, the 'Construct/Update Posterior Model' step 12b also receives the 'while drilling data deck' at further iterations or stations starting at iteration or 'station': 'N=N+ 1 '. The 'Construct Flow Simulation Model' step 16 associated with the 'history matching phase' 12cl of the 'simulator' 12 receives an output from the 'Construct/Update Posterior Model' step 12b. The Optimize NPV subject to C 1 - ClO & Predict Productivity' step 18 associated with the 'prediction phase' step 12c2 of the 'simulator' 12 receives an output from the 'Construct Flow Simulation Model' step 16 at iteration or 'station': N=I; however, in addition, the 'Optimize NPV... ' step 18 also receives the 'prediction data deck' 14c at further iterations or stations beginning at station: N=N+ 1. When the 'Optimize NPV subject to Cl - ClO & Predict Productivity' step 18 associated with the 'prediction phase' step 12c2 of the 'simulator' 12 is completed, the next step 20 asks: 'Further Optimization of NPV Possible?' (step 20). If the output of step 20 is 'yes' (i.e., further optimization of NPV is possible), move to the next iteration or 'station' N=N+ 1 , and then go to step 14b 1. If the output of step 20 is 'no' (i.e., no further optimization of NPV is possible), then 'stop drilling' at step 22.

[029] A more detailed explanation of each step of the flowchart or block diagram of figure 3 will be set forth in the following paragraphs.

[030] In figure 3, three phases of simulation are illustrated: (1 ) the model construction phase, (2) history matching phase, and (3) prediction phase. The input data sets necessary for each phase are contained in the 'Simulation Data Deck' 14. The modeling is performed during the drilling. The well being Production Steered will be referred to as the 'Production Steered Well'. The information in the Simulation Data Deck 14 is divided into three sub data decks: the Prior-Data-Deck 14a, which is the information that describes the state of the reservoir prior to the well being drilled; the While-Drilling Data Deck 14b2, which is the information acquired, processed and interpreted during drilling, and the Prediction Data Deck 14c which describes how the Production Steered Well and the other wells in the reservoir will be produced and/or injected.

[031] The prior data deck 14a, the while-drilling data deck 14b2, and the prediction data deck 14c will be discussed in detail in the following paragraphs.

Prior Data Deck 14a

[032] The Prior Data Deck 14a incorporates information on at least the following items:

[033] Reservoir fluid properties: These may include information on the types of fluid phases that may occur in the simulation model (oil, water, gas, solids such as asphaltenes and sand) and the respective saturations, densities, viscosities, compressibilities, expected phase behavior(s), reaction between injected and formation rock and formation fluids, formation fluid spatial distributions (eg a hydrocarbon compositional gradient, mud filtrate invasion depths);

[034] Reservoir rock petrophysical properties: These may include porosity distribution, permeability tensor distribution in single or multiple porosity systems, compressibility;

[035] Rock/fluid interaction: These may include capillary pressure curves, relative permeability curves (including endpoint variations) and hysterisis in these relationships;

[036] Geomechanics: These may include dependence of properties on pressure and temperature, fines migration, onset of sanding;

[037] Fluid Contact(s): These may include standoff from Gas-Oil and Water-Oil contacts;

Reservoir pressures and temperatures; and

Sedimentary/Tectonic and boundaries: These are estimated position and nature of reservoir thickness and lateral extension.

[038] Many of the parameters in the Prior Data Deck 14a are updated after history matching. This is the process by which these parameters are modified so that the flow simulation models reproduce relevant observations. These observations are generally from the Production Steered Well. But they may also be from similar wells in the same reservoir. When the flow simulation models are being history matched, they are referred to as being in History Matching phase. In this phase they must have the facility to model well bore hydraulic behavior, filtrate invasion (the overbalance drilling case), flow from the formation (underbalance drilling case), and the geomechanical effects associated with drilling.

[039] In more detail now, the observations which must be reproduced during History Matching phase include:

A. Near well bore phenomena in the Production Steered Well or in other wells of the reservoir. Such phenomena include:

a. rate and depth of invasion of mud filtrate;

b. supercharging of the pressures measured whilst drilling;

c. Pressure and rate transient data;

d. Filtrate clean up behavior observed when pumping fluids from various locations along the well;

e. Fluid produced if and whenever the well is being drilled underbalance; and

f. The evidence of formation fluids which can be gathered by analysis of drilling cuttings.

B. Reservoir Scale phenomena. These might include:

a. Spatial distributions of the pressures of the reservoir fluids. For example, the formation fluid pressure distributions which have been measured whilst drilling the Production Steered Well, and which may also have been integrated into a Regional Pore Pressure Model, including pressure transient interference from other wells.

b. Reservoir fluid distributions (including spatial compositional variations if relevant). For example, the reservoir fluid distributions inferred from down hole fluid analysis measurements, acquired from the Production Steered Well and perhaps other wells.

c. Reservoir geomechanical properties. For example the stress tensor distribution coming from a regional Mechanical Earth Model.

[040] Initializing and re-initializing the While-Drilling Data Deck 14b2

The initial version of the While-Drilling Data Deck 14b2 will contain parameters. Many of these come from measurements made from the Production Steered Well and/or from similar wells in the same reservoir. The measurements are explained in more detail below:

[041 ] Porosity will be measured by Logging While Drilling (LWD) measurements which include:

• Neutron Porosities

^• Sigma and sonic derived Porosities • Formation Bulk Density derived Porosities

^• Nuclear Magnetic Resonance (NMR) Porosities

[042] The necessary formation fluid saturations, in the invaded zone as well as the un- invaded zone will be derived from LWD measurements which include:

• Nuclear Capture Cross Section

• Resistivity measurements

• NMR measurements

• Carbon/Oxygen measurements [043] Information to derive the permeability tensor will come from LWD measurements which will include the following:

• Pore size correlations from LWD Nuclear Magnetic Resonance (NMR) measurements. • Permeability estimation from LWD nuclear elemental spectroscopy.

• Permeability estimation from LWD sonic measurements.

• Porosity to Permeability transformations.

• Image logs (for secondary porosity estimation and bedding Dip).

^• Pretests from Formation Pressure While Drilling Measurements StethoScopeJFPWD).

[044] The approximate ratio of horizontal to vertical permeability can be estimated from techniques which include the following:

• Computing the ratio of the arithmetic to harmonic averages of the FPWD pretest mobilities.

• Using Formation Testing While Drilling (TestWD) tool, which has been designed to measure permeability anisotropy.

• Resistivity anisotropy.

[045] The simulation layering to be used in the While-Drilling Data Deck will be inferred from Logging While Drilling (LWD) measurements which include:

• Image logs

• Nuclear elemental spectroscopic logs

• Deep imaging tools such as the PeriScope, which relies on detecting resistivity contrasts

[046] Near well bore pressures will be measured by the FPWD tool. Supercharging and other distortions on the pressures will be corrected by established methods. The pressures will then be processed to provide information on the average reservoir pressures within the drainage region of the Production Steered Well, the densities of the fluids which are in the formation intersected by this well, and the depths of the reservoir fluid contacts.

[047] Data for the reservoir and well bore fluids will be acquired by downhole LWD sensors, and/or inferred from pressures by the LWD tool and/or inferred from drilling cuttings and/or be inferred from neighboring wells.

[048] Fluid Contact Depths will be inferred from Logging While Drilling (LWD) measurements which include:

• Pressure Gradients inferred from FPWD measurements from StethoScope

• Deep imaging resistivity tools such as the PeriScope

• Downhole analysis of formation fluids

[049] Capillary pressure curves can be inferred from various sources, including LWD logs such as NMR and array resistivities. Data to infer capillary pressure may also come from the pressures measured by the FPWD tool.

[050] Two Phase relative permeability curves can be inferred from knowledge of the mud filtrate invasion. Examples of doing this are:

• "Flare" processing on array resistivity invasion profiles.

• Observing how the filtrate contamination diminishes when formation fluids are pumped back into the well bore.

Data to model the hydraulic behavior in the well bore will be measured by the LWD sensors.

[051 ] Further information to aid construction of the While-Drilling Data Deck can be gained if the Production Steered Well is being drilled underbalance. Such information can come from:

^• Water Flow Logging, WFL, using an LWD Pulse Neutron Generator (PNG).

^• Phase velocity logging using a miscible injector system in an LWD tool.

• Optical and/or electrical probes mounted on a drill collar.

Prediction Data Deck 14c

[052] The information contained in the Prediction Data Deck 14c includes the expected flow/injection rates of the surrounding wells, the pressure constraints on the wells, and the economic criteria which will be used to optimize the value of the production from the wells. In the Prediction Phase of the simulations, Production Steering, for an oil well, maximizes the objective function:

NPV = f(WOPT , Ccosts-of-well)

where 'WOPT' is the cumulative amount of oil that can be produced from the Production Steered Well. It is assumed to be drilled into a reservoir which contains Oil and perhaps mobile Gas and Water. 'Ccosts-of-well' are the total costs of starting and maintaining production from the well.

[053] The optimization of 'NPV is subject to the following constraints:

C1: Cstarting-production < Ccapex-budget

C2: Tproduction < Tmax

C3: WWPR < WWPRmax

C4: WGORmin < WGOR < WGORmax C5: WBHP > WBHPmin

C6: WT HP > WT HPmin

Cl: Preservoir > Pabandonment C8: WOPR > WOPRmin C9: WT HT > WT HT min ClO: Cmaintaining-production < Copex-budget

[054] Where in the constraints Cl to ClO:

'Cstarting-production' are the costs of bringing the well on line to start oil production. Typical factors which contribute to 'Cstarting-production' include: drilling the well, completion and tubulars, artificial lift, flow assurance, required pipeline and surface processing facilities and well clean up.

'Ccapex-budget' is the capital expenditure budget which can be allocated for starting production.

'Tproduction' is the time over which the oil is produced.

'Tmax' is the maximum time that the well can be produced for. There are many possible reasons why a 'Tmax' could exist. For example 'Tmax' could be the related to the period for which the well can be legally produced.

'WWPR, WWPRmax' are respectively the predicted and maximum allowable well water production rates.

'WGOR', 'WGORmax', 'WGORmin' are respectively the predicted, maximum and minimum allowable producing gas oil ratios.

'WBHP', 'WBHPmin' are respectively the predicted and minimum allowable well bottom hole flowing pressures.

'WTHP', 'WTHPmin' are respectively the predicted and minimum allowable well tubing head flowing pressures.

'Preservoir > Pabandonment' are respectively the predicted and minimum allowable reservoir pressures WOPR > WOPRmin are respectively the predicted and minimum allowable oil production rates.

'WTHT', 'WTHTmin' are respectively the predicted and minimum allowable well tubing head temperatures.

'Cmaintaining-production' are the recurring costs of maintaining production.

'Copex-budget' is the budget for operating expenditures.

Constructing the Base Model 12a of figure 3

[055] Using all available relevant information, a Base Model 12a of the reservoir is prepared prior to the drilling of the well. This is done using 'Petrel', the 'Single Well Predictive Model (SWPM)', and the fast flow simulation software 'GREAT' . Alternately, the base model could come from 'PetrelRE' using 'Eclipse'. The model is capable of predicting the well production performance and is used to help design the well trajectory so that the objective function 'NPV can be maximized. The layering and petrophysical properties required for the simulation will be obtained from surrounding well data. The terms 'Petrel', 'Single Well Predictive Model (SWPM)', 'GREAT' , 'PetrelRE', and 'Eclipse' represent software products that are owned and operated by Schlumberger Technology Corporation of Houston, Texas.

[056] The 'Single Well Predictive Model (SWPM)' software, hereinafter referred to as 'SWPM', is set forth in prior pending application serial number 1 1/007,764 filed December 8, 2004, which is a continuation in part of application serial number 10/726,288 filed on December 2, 2003, which is a utility application of prior provisional application serial

number 60/578,053 filed on June 8, 2004, the disclosures of which are all incorporated by reference into the specification of this application.

[0571 The fast flow simulation software 'GREAT', hereinafter referred to as 'GREAT', is set forth in U.S. Patent 7,069,148 B2 to Thambynayagam et al, entitled "Gas Reservoir Evaluation and Assessment Tool Method and Apparatus and Program Storage Device", the disclosure of which is incorporated by reference into the specification of this application.

Update the Base Model 12a to produce an interim Posterior Model 12b in figure 3

[058] As drilling commences, some of the data required for Production Steering is acquired from the well being drilled. The data which may be acquired has been previously described herein. The newly acquired data is used to update the Base Model 12a of figure 3, using Bayesian techniques, in order to generate an interim Posterior Model 12b in figure 3. It should be noted that the Base Model 12a itself can handle the uncertainties in the input parameters by calculating a range in the predicted 'NPV of the well.

[059] The depth and thickness of layers used in the simulation model will be constructed after interpretation of some of the measurements referred to above to update the base model. The data from the LWD logs, which have been mentioned previously in connection with the While-Drilling Data Deck 14b2, will be integrated by using log analysis methods to provide continuous values of Porosity, fluid saturations, Permeability and two-phase relative permeabilities. The integration procedure will also allow the use of non-LWD data, such as that from core analysis. The depths of the fluid contacts, the associated properties of the fluids, and the distributions of capillary pressures will be inferred from some of the measurements referred to above.

[060] The above described traces will be used as part of the creation of a three dimensional layered model of the reservoir. The model will also be able to account for the hydraulic behavior in the well bore during drilling of the well. Moreover, it will be sufficient to model the impact of the Production Steered Well on future production from the field into

which it is being drilled. Consequently, the model will contain the Production Steered Well and perhaps other wells in the reservoir. The model may be created by methods, such as Artificial Neural Networks to recognize layering from the LWD logs, and Geostatistics to create the property distributions. The constructed model will be used with 'SWPIVf and 'GREAT' to perform the analysis and simulations.

Construct flow simulation model 16 of figure 3

[061] The above described layered model of the reservoir will be converted to a simulation model of the reservoir in order to enter the history matching mode. The history matching mode involves correction of log derived permeability by matching model generated pressure with actual transient FPWD pressure if available. During this process, correction for supercharging effects due to the invasion of drilling fluid is performed. The history matching process also results in a calculation of formation skin for the well. In addition, the While Drilling Data Deck 14b2 will be history matched to reproduce relevant observations described previously in this document. The fast simulator 'GREAT' will be used for multi- well interference history matching.

[062] After the history matching is complete, the While-Drilling Data Deck 14b2 can be combined with the Prediction Data Deck 14c to create an ensemble of simulation models. Collectively they can be used to model the impact of the Production Steered Well on future production from the field into which it is being drilled. Techniques, such as upscaling and downscaling, will be used prior to the flow simulation with 'GREAT'. The model is used to optimize the 'NPV subject to constraints Cl to ClO (also described above), at certain specified levels of risk of not achieving the 'NPV, and so perhaps to redesign the well (i.e., changing trajectories). This step is performed by the 'AURUM' software in conjuction with the fast simulator 'GREAT'. Thus, in this embodiment, uncertainty is quantified in the predictions from the reservoir model used for Production Steering. Bayesian techniques are well known to be suited to incorporating observations into a prior model of a system, and so do not need to be explained here.

('063 ) The 'λURUM' software is a product of Schlumberger Technology Corporation of Houston, Texas.

The simulation model can now be used to predict the pressure-production performance of the well. A simulated multirate test can give the Inflow Performance Relationship (IPR) of the well. A comparison of the IPR's at different times is indicative of the buildup of productivity of the well.

[064] The NPV Max Software 12 disclosed in this specification also handles the risks associated with uncertainty in the bounding constraints associated with conditions Cl to ClO.

[065] Then, as drilling proceeds, more of the data required for Production Steering is acquired from the Production Steered well. This data is used to periodically update the Posterier Model 12b using Bayesian techniques, and subsequently to repeat the optimization of 'NPV. The above steps of 'Updating the Base Model 12a to produce an interim Posterior Model 12b' and 'constructing a flow simulation model' 16 of figure 3 will be repeated at several stations during the drilling of the Production Steered Well.

Stop drilling The Well

[066] Terminate drilling of the well when the modeling from the Production Steering indicates that it is unlikely (to within a specified degree of confidence) that 'NPV can be optimized any further, even if further data is acquired and/or if one of the constraints Cl to ClO will be violated.

Transmission of the data needed to re-initialize the While-Drilling Data Deck 14b2

[067] The 'NPV Max Software' 12 will ensure that Logging While Drilling (LWD) data, acquired while drilling the Production Steered Well, is transmitted efficiently from downhole to the rig surface, and then from the rig surface to the locations where the

While-Drilling Data Deck 14b2 is being built. To ensure efficiency, signal processing techniques, such as Discrete Wavelet Transforms and Discrete Fourier Transforms, will be used to eliminate distortions to the data and to compress the data.

[068] A functional description of the operation of the 'NPV Max software' 12 of figure 1 is set forth in the following paragraphs with reference to figures 1 through 3 of the drawings.

[069] In figures 1 and 2, referring initially to figure 2, recall the 'functions of the NPV Max software 12' which are illustrated in figure 2: (1 ) construct and use flow simulations to model the impact of a well being geosteered on future production from a reservoir field into which the well is being drilled, 12a, (2) use the flow simulations to optimize (or maximize) the value of this production by manipulating the drilling methods of the well being geosteered, 12b, and (3) use the data acquired from the well being geosteered to construct the flow simulations and thereby influence the drilling of the well, 12c. In figure 1 , drilling of a wellbore in a 'real (not modeled) reservoir' commences, and, simultaneously, the processor 10a of the computer system 10 of figure 1 begins to execute the 'NPV Max Software' 12 in order to calculate a value of the 'Net Present Value (NPV)' for each 'station' of a 'modeled reservoir', a plurality of the values of the 'NPV corresponding, respectively, to the plurality of 'stations' of the 'modeled reservoir' assisting (a drilling person or entity) in the drilling of the wellbore in the reservoir; for example, the wellbore's trajectory can be changed while drilling, or the drilling methods used to drill the wellbore can be changed accordingly. When the processor 10a of figure 1 executes the 'NPV Max Software' 12 which is stored in memory 10c, while using the simulation data deck 'input data' 14 (which includes a 'prior data deck', a 'while drilling data deck' and a 'prediction data deck'), the processor 10a of figure 1 will determine (by using the 'flow simulations' which are run and executed by a 'simulator' that is embodied in the 'NPV Max Software 12) a 'maximum value of Net Present Value ('NPV)' for each 'station' in a 'modeled reservoir' field during the drilling of a corresponding 'real (not modeled) wellbore'. Recall that a 'station' of a reservoir field is defined as a 'time dependent point (along the modeled reservoir field)'. In addition, recall that the term 'Net

Present Value (NPV)' is defined to be a function of the 'expected value of hydrocarbon production, minus the costs of drilling and completing and maintaining the well'. The 'Net Present Value (NPV)' is represented by an Objective Function', where the 'Objective Function' is further represented by the following equation: 'NPV = f(WOPT, Ccosts-of- well)', where 'WOPT' is the cumulative amount of oil that can be produced from a production steered well, and 'Ccosts-of-weli' are the total costs of starting and maintaining production from the well. During the drilling of a 'real (not modeled) wellbore' in a reservoir field, the processor 10a will maximize or optimize the above referenced Objective Function' for each 'station' in the 'modeled reservoir' thereby determining 'one or more values of the Net Present Values (NPV)' for each 'station' in the 'modeled reservoir'. When the processor 10a determines 'one or more values of Net Present Value (NPV)' for each 'station' in a 'modeled reservoir', 'a plurality of net present values' will be determined which correspond, respectively, to 'a plurality of stations' in the 'modeled reservoir'. When the 'plurality of net present values' are determined corresponding, respectively, to 'the plurality stations' in the modeled reservoir, the drilling person or entity can then determine (from the 'plurality of net present values' corresponding, respectively, to the 'plurality of stations' in the 'modeled reservoir'): how to 'geosteer' and drill a wellbore into the corresponding (real, not modeled) reservoir, and/or how to change the drilling methods associated with drilling the wellbore, in order to maximize the production of oil and/or gas from that corresponding reservoir. For example, when the 'plurality of net present values' are determined corresponding, respectively, to 'the plurality stations' in the 'modeled reservoir', the 'drilling person or entity' can then determine (from the 'plurality of net present values' corresponding, respectively, to the 'plurality of stations' in the 'modeled reservoir') the specific "stations of the modeled reservoir which have the 'optimum ones' or 'maximum ones' of the plurality of values of NPV". When the 'drilling person or entity' knows which "stations of the modeled reservoir have the 'optimum ones' or 'maximum ones' of the plurality of values of NPV", the 'drilling person or entity' can then: (1) drill and 'geosteer' the wellbore into the reservoir, and/or (2) change the trajectory of the wellbore being drilled into the reservoir in order to follow the "stations of the modeled reservoir which have the -optimum ones' or 'maximum ones' of the plurality of values of NPV". thereby optimizing or maximizing the production of oil and/or gas from

the (real, not modeled) reservoir. In addition or in the alternative, the 'drilling person or entity' can change the drilling methods, while drilling the wellbore into the reservoir, specifically in accordance with the 'optimum ones' or 'maximum ones' of the 'plurality of values of NPV, corresponding, respectively, to the plurality of stations of the modeled reservoir, thereby maximizing the production of oil and/or gas from the (real, not modeled) reservoir. When the wellbore is 'geosteered' and drilled into the 'real (not modeled) reservoir', 'data' is acquired during the 'geosteering' and drilling of the wellbore into the 'real (not modeled) reservoir', and that 'data' can then be used to reconstruct the aforementioned 'flow simulations', which are then subsequently re-run and re-executed by the 'simulator' that is embodied in the 'NPV Max Software' 12 of figure 1.

[070] In figure 3, refer to figure 3 which illustrates a detailed construction of the 'NPV Max Software' 12 and its associated 'Simulation Data Deck' 14. In figure 3, the drilling process begins, at step 13. Start with the 'first station' (N = 1), which is the 'first station' in the 'modeled reservoir'. In the first iteration of figure 3 corresponding to the 'first station' (N=I) of the 'modeled reservoir', 'one or more values of NPV will be determined for the 'first station' of the 'modeled reservoir'. In subsequent iterations corresponding to 'subsequent stations' (N=N+ 1 , N=N=2, etc) of the 'modeled reservoir', 'one or more additional values of NPV will be determined for the 'subsequent stations' in the 'modeled reservoir'. The drilling process stops, at step 22, when further optimization of NPV is not possible. While drilling a wellbore in a corresponding real (not modeled) reservoir, the 'drilling person or entity' will use the 'one or more values of NPV for the 'first station' of the 'modeled reservoir' and the 'one or more additional values of NPV for the 'subsequent stations' in the 'modeled reservoir' (which were determined by the computer system of figure 1) to determine the wellbore's optimum 'trajectory while drilling' the real (not modeled) reservoir and/or the optimum 'drilling methods' used to drill the wellbore in the real (not modeled) reservoir in order to maximize the production of oil and/or gas from the reservoir.

[071 J In figure 3, recall that the information in the Simulation Data Deck 14 of figures 1 and 3 is divided into three sub data decks: the Prior-Data-Deck 14a, which is the information that describes the state of the reservoir prior to the well being drilled; the While-Drilling Data Deck 14b2, which is the information acquired, processed and interpreted during drilling, and the Prediction Data Deck 14c which describes how the Production Steered Well and the other wells in the reservoir will be produced and/or injected. Using all information available, including the data embodied in the prior data deck 14a and the prediction data deck 14c, a 'base model' 12a of figure 3 is constructed prior to the drilling of a 'wellbore' in a reservoir field. The 'base model' 12a of figure 3 is capable of predicting the production performance of the 'wellbore' and is used to help design the trajectory of the 'wellbore' so that the Objective Function NPV can be maximized (for each station of the modeled reservoir). As the drilling of the 'wellbore' commences, some of the data required for 'production steering' is acquired from the 'wellbore' being drilled. This newly acquired data is used to update the 'base model' 12a to thereby generate the 'interim posterior model' 12b of figure 3, where the 'interim posterior model' 12b represents a 'three dimensional layered model of the reservoir' that is sufficient to model the impact of the production steered well on the future production from the reservoir field into which the 'wellbore' is being drilled (see function 12a of figure T). Consequently, the 'interim posterior model' 12b will contain the 'production steered well' and perhaps other wells in the reservoir. The 'interim posterior model' 12b, which represents a 'three dimensional layered model of the reservoir', is then converted to a 'simulation model of the reservoir' in order to enter the 'history matching phase' 12cl of figure 3. In general, in the 'history matching phase' 12c 1 of figure 3, previously known 'historical data' (having 'known historical results') will be introduced into the aforementioned 'simulation model of the reservoir'. Responsive thereto, the 'simulation model of the reservoir' will generate 'results'. The 'results' generated by the 'simulation model of the reservoir' will be compared to the 'known historical results'. If the 'results' approximately equal the 'known historical results', the 'simulation model of the reservoir' has successfully passed the 'history matching phase' 12c 1. At this point, the processor 1 Oa can now commence the 'prediction phase' 12c2 wherein the future behavior of the reservoir can be predicted In particular, in the 'history matching phase' 12c 1 of figure 3.

recall that the 'history matching phase' 12cl involves correction of log derived permeability by matching model generated pressure with actual transient FPWD pressure if available. During this process, correction for supercharging effects due to the invasion of drilling fluid is performed. The history matching process also results in a calculation of formation skin for the well. After the 'history matching phase' 12cl is complete, in the 'prediction phase' 12c2 of figure 3, the 'while drilling deck' 14b2 can be combined with the 'prediction data deck' 14c to thereby create an 'ensemble of simulation models'. Collectively, the 'ensemble of simulation models', which are collectively embodied in the 'prediction phase' 12c2 of figure 3, can be used to model the impact of the production steered well on future production from the reservoir field into which the 'wellbore' is being drilled (function 12a of figure 2). The 'ensemble of simulation models', embodied in the 'prediction phase' 12c2, are used to optimize the 'Net Present Value (NPV)', subject to constraints Cl to Cl O (see step 18 of figure 3). That is, the 'ensemble of simulation models', embodied in the 'prediction phase' 12c2, are used to optimize the Objective Function 'NPV = f(WOPT, Ccosts-of-well)' (see step 18 of figure 3), where 'WOPT' is the cumulative amount of oil that can be produced from a production steered well, and 'Ccosts- of-well' are the total costs of starting and maintaining production from the well. When the 'Net Present Value (NPV)' is optimized, the 'wellbore' can be redesigned. For example, when the 'wellbore' is redesigned, the trajectory of the 'wellbore' can be changed, or the drilling methods, for drilling the wellbore, can be changed. The aforementioned 'ensemble of simulation models' (hereinafter, the 'simulation model') can then be used to predict the pressure-production performance of the 'wellbore'. As drilling of the 'wellbore' proceeds, more of the data required for the production steering is acquired from the production steered well, and this data is used to update the 'posterior model' 12b of figure 3 and then repeat the optimization of 'NPV in the 'optimize NPV... ' step 18 in the 'prediction phase' 12c2 of figure 3. The above described steps of 'updating the base model 12a to produce the posterior model 12b' and 'constructing the flow simulation model' 16 are then repeated at several 'stations' during the drilling of the production steered 'wellbore'; therefore, increment 'N', from 'N - T to 'N=N+ T (where 'N=I ' represents the ' first station' and 'N=N+ 1 ' represents the 'second station') and repeat the abo\e referenced steps However.

the drilling of the 'welibore' in the reservoir is terminated when the modeling of the production steered well indicates that it is unlikely that the 'NPV' can be further optimized.

DETAILED DESCRIPTION

[072] In figure 3, in this specification, the simulator 12c of figure 3 is used for the purposes of automatic history matching 12cl , and optimization and production prediction 12c2. The simulator 12c includes a set of initial and bound conditions and a governing equation.

[073] The 'Initial and boundary conditions and the governing equation' associated with the simulator 12c of figure 3 are set forth below in the following paragraphs.

Mathematical solution of the layered reservoir flow simulation problem

[074] In figure 3, the workflow of figure 3 includes a fast, gridless, analytical simulator 12c which is particularly suitable for handling pressure and rate transient data. The generalized analytical simulator 12c of figure 3 supports horizontal, vertical and deviated wells in a multilayer heterogeneous reservoir. The reservoir boundary can be modeled as no-flow or constant pressure (signifying an aquifer) or a combination of both. The simulator 12c can model both naturally fractured (dual porosity) reservoirs and hydraulic fractures at individual wells. The hydraulic fracture model accounts for non- Darcy flow in the fracture. Even though the well is represented by a line source, suitable

industry standard corrections have been applied to account for wellbore storage effects and finite wellbore radius. The wells may have finite and infinite conductivity hydraulic fractures. Interference effects from multiple wells are simulated. In this invention, the simulator is used for the purposes of automatic history matching, optimization and production prediction.

Initial and boundary conditions and the governing equation.

pressure response

The Production Steered Well

An inclined line of finite length [(zo _2j - zoι _} )smϋ _o ] passing through (xoj,yaj, zoj)-

The solutions for a continuous source is given by

Where is the inclination to the .τ - y plane and 7 _0j is the intercept to the z axis.

We employ, in time domain, the interfacial boundary condition Substituting for from equation (0.2) in

we obtain a three-point recurrence integral equation relationship in time and space

0 0 0

The coefficients of the recurrence integral equation (0.3) for d _j < z < d _j +1 , Vj = 1, 2, , K - 1, are given by where

and





The spatial average pressure response of the inclined line ' ^s obtained by a further integration

The Production Steered Well and other wells (vertical, horizontal and fractured) in the reservoir.

The pressure solution at any given point [x, y, z\ in space at time t is obtained by replacing the source term in equations (0.2) by

The coefRcients of the recurrence integral equation , and are given by equations (0.4), (0.6) and (0.7) respectively. The coefficient ω _; ^cc (x, y, t) is given by

The spatial average pressure response of the line is given by





The spatial average pressure response of the line is given by. t t



9039459

The spatial average pressure response of the inclined line is given by

2009/039459

009/039459

The spatial average pressure response of the rectangle is given by

009/039459

The spatial average pressure response of the rectangle is given fay ' ^~ta





[075] Refer now to figure 4 which illustrates a pressure / pressure derivative comparison with a numerical simulator for a deviated well.

[076] In figure 4, specifically, for a high angle deviated well, the pressure output by the fast simulator was validated against a numerical simulator for accuracy and speed. The pressure and pressure derivative match is presented in figure 4. In this case, the new solution took three (3) seconds to execute compared to four (4) minutes for a numerical simulator. Another important point to note here is that it took considerable time (i.e., half a day) to create the finely gridded numerical model and ensure that it was relatively free from grid effects. The analytical model, on the other hand, was completely gridless and could be created with a few mouse clicks.

Two phase pseudo pressure

[077] The base equation is strictly valid for a slightly compressible single phase fluid. However, we have applied suitable linearization methods for gas (compressible fluid) and multiphase applications. Specifically for gas, we have used the real gas pseudo pressure concept as described by (Al-Hussainy, Ramey, and Crawford 1966). At low pressures, linearization was improved by using pseudo time (Agarwal 1979). On the other hand, for multiphase flow, we used the two-phase pseudo pressure concept as described by (Raghavaan 1976).

Two phase pseudo piessure is givpn by k _ro is not really a function of pressure but of satui ation The tuck here is to find liow satui dtion [S ₀ ) is related to pressure A r elationship can be obtained through experiment and is based on the following equation

Please note t hat R is measured producing gas-oil ratio at ( he surlare

1 Fom well test tabulate t, /; and R

2 From PVT and well test calculate using Equation 2

3 From relative-permeability curves (experiment or Corey 's coπelalion) calculate as a function of S ₀

4 From ( he above gel p vs S ₀ Warning Ext rapolation may be necessary lor I he next step

5 Now for any p we can got k _ro

6 Using numerical integr ation get m (p) for all p

Note that for build-up (well is shut in) a modification of the above procedure is necessary In such a case in Equation 2 use for R the value prior to shut in

As can be seen from above evaluation of the pseudo pressure integral requires knowledge of pressure- satuiation relationship This is often difficult to find for long time prediction However, for term tests with proper ineasuitineuts the pr ocedure described above can realistically. be applied

Nomenclature

kind tic

of

Eliptic theta function of the third kind

References

Agarwal, R (1979, September) Real gas pseudo-time - a new function for pressure buildup analysis of mhl gas wells SPE (8279), 23-26

Al-Hussainy, R ₁ H J J Ramey, and P Crawford (1966) The flow of real gases through porous media Trans SPE AMIS

Bailey, W J ₁ B Couet, and D J Wilkinson (2004, March) Field optimization tool for maximizing asset value SPE (87026) Banerjee, R., R. K. M. Thambynayagam, and J B Spath (2005) A method for analysis of pressure response with a formation tester influenced by supercharging SPE ( 102413)

Brehm, A D K and C D Ward (2005) Pre-dnll planning saves money E&P

Brie, A , T Endo, D L Johnson, and F Pampun Quantitative formation permeability evaluation from stonelcy waves SPE (49131)

Busbwell, G S ₁ R Banerjee, R K M Thambyuayagam, and J B Spath (2006) Generalized analytical solution for reservoir problems with multiple wells and boundary conditions SPE (99288)

Chang, Y P S Hammond, and J Pop When should we worry about supei charging in formation pressure while drilling measurements? SPE (92380)

Gilchnst, J P ₁ G S Busswell, R Banerjee, J B Spath , dnd R K M Thambynayagam (2007, Decem- ber) Semi-analytiral solution for multiple layer reservoir problems with multiple vertical, hori7ontal, deviated and fractuied wells SPE IPTC (11718)

Hammond, P. and J. Pop. Correcting super-chargingin formation pressurements made while drilling. SPE. (95710).

Herron, M., D. L. Johnson, and L. M. Schwartz. A robust permeability estimator for siliciclastics. SPE. (49301).

Raghavan, R. (1976, September). Well test analysis: Wells producing by solution gas drive. Trans SPE AMIE.

Raghuraman, B., B. Couet, P. Savundararaj, W. J. Bailey, and D. Wilkinson (2003, October). Valuation of technology and information for reservoir risk management. SPE, Reservoir Evaluation and Engineering, 307-314.

Ramakrishnan, T. S. and D. J. Wilkinson. Water cut and fractional flow logs from array induction measurements. SPE. (36503).

Shi, C., L. Gaorning, P. Alvaro, and A. C. Reynolds. A well test for in-situ determination of relative permeability curves. SPE. (96414).

[078] Each of the 'References' set forth above are incorporated by reference into the specification of this application.

[079] The above description of the 'NPV Max Software' being thus described, it will be obvious that the same may be varied in many ways. Such variations are not to be regarded as a departure from the spiπt and scope of the claimed method or system or program storage device or computer program, and all such modifications as would be obvious to one skilled in the art are intended to be included within the scope of the following claims.