# EPA Hydraulic Fracturing Workshop 

# March 10 th 

# - 11th 

# , 20112 

# “ Fracture Design in Horizontal Shale Wells – Data Gathering to Implementation ” Tim Beard Sr. Engineering Advisor - Completions
Chesapeake Energy Corporation 6100 N. Western Avenue ı Oklahoma City, OK 76118 ı 405 - 935 -8000 AskChesapeake@chk.com ı chk.com ı NYSE: CHK3 

# Presentation Overview Goal Planning 

## • Data • Measuring • Validating • Properties Needed in Modeling • Designing the Hydraulic Fracture • Frac Models in Vertically Heterogeneous Formations Execution4 

# CHK’s Operating Areas

Low- risk, U.S. onshore asset base; Not exposed to economic, geopolitical or technological risks internationally or in the Gulf of Mexico5 

# Shale Information

Shale Play Fayetteville Barnett Eagle Ford Haynesville Marcellus Average Depth From Surface (ft) 4,500 7,400 9,000 11,500 7,100 Bottom Hole Temperature (F) 130 190 260 320 145 Bottom Hole Pressure (psi) 2,000 2,900 6,200 10,000 4,6006 

# What is the Goal of Hydraulic Fracturing? Maximize the Stimulated Reservoir Volume (SRV) along the horizontal wellbore for a given well spacing to maximize hydrocarbon production within the zone of interest. Orientation and lateral length 

## Vertical placement within flow unit Rock Properties/Mechanics Stages/Perf Clusters/Isolation Fluid and proppant selection7 

# Planning8 

# What data do we use? What are the main variables that need to be factored into each frac design?

• Porosity and Permeability • Lateral Length • Brittleness vs. Ductility • Young’s Modulus • Poisson’s Ratio • Fracture Toughness • Thickness • Barriers • Depth • In -Situ Stress • Maximum Principle Stress Direction • Lithology of Pay • Stress Anisotropy • Natural Fractures • Gas or Liquids Reservoir • Temperature • Reservoir Pressure9 

# Wireline Log Data Logs are run in regionally representative pilot wells over the zone(s) of interest. Triple Combo Log, Spectral Gamma Ray, Dipole Sonic Log, Formation MicroImager 

## The data gathered from the logs is utilized to do a petrophysical analysis and to calculate the rock mechanical properties of the reservoir to determine pay intervals, barriers, etc. FMI and multi -caliper log data are also used to determine a maximum and minimum principle stress direction and to determine if there are natural fractures present.10 

# Lateral Orientation

Maximum Principle Stress Direction

Lateral Placement 

### ● Perpendicular to maximum principle stress



### ● Optimize transverse fracturing 

### ● Slight variations for more efficient pattern development11 

# Lateral Placement

● Target highest quality rock with consideration given to stress profile and fracture geometries 

### ● Preferred lateral placement in upper to middle portion of target zone to optimize proppant placement 

### ● Toe high with option of traversing the entire section12 

# Mechanical Properties and Stress Estimation from Acoustic Logs Elastic Moduli Estimated from Acoustic Logs Several Stress Equations are Appropriate Uniaxial Transverse Isotropic Equation (Lateral Strain Model): σ Hmin = (E h/ E v)( νv

/(1-ν h ))( σv-α Pp) + α Pp + (E h/(1-v h 2 )) ε hmin + ( E h v h/(1- v h 2 )) ε hmax This equation expands the σtectonic to incorporate lateral strain. Tectonic strain creates greater stress in stiff sandstone/limestone beds and less stress in organic- rich shales. Estimated Stress Calibrated with Well Test13 

# Pump- In Testing: Key Calibration Pump- In Tests Conventional Pump - In Tests in Cased Hole

― Closure Stress is Determined

― After Closure Analysis MDT Pump- In Tests in Open Hole

― Closure Stress is Determined 

## Core Data The pump- in tests along with the core 

## data calibrate mechanical properties data.14 

# Fracture Model – Mechanical Properties Petrophysics processes the Dipole Sonic log for rock mechanical properties and that data is utilized in the frac model.15 

# Fracture Model – Fluid Flow and Leakoff The fluid loss data input into the model.16 

# Fracture Model Methodology The actual deviation survey for the well that is being modeled, as well as the planned perforations for the well, are entered. A pump schedule is entered into the fracture model. Numerous iterations with different pump schedules, perforation schemes, and other variable modifications are run to “optimize” the design. What is the play specific “optimum” design? Covers the height of the pay interval Creates a sufficiently conductive propped fracture length that fits our well and perf spacing, with some overlap. Minimizes well interference. Provides the best production results based on reservoir flow simulation.17 

# Example Frac Model Results As depicted in the model, the fracture propogates primarily only in the lower stress portion of the rock. The lower stress portion of the reservoir “contains” the frac High stress barriers exist above and below the fracture matching lithology changes. Vertical variations in stress exist throughout the sections depicted.18 

# Example Frac Model Results Fracture is contained by lower stress interval and high stress barriers above and below the lower stress interval. Variable stress throughout section, matching lithology changes Greater height growth typically leads to less fracture length. Note, this is predicted fluid distribution, not predicted propped fracture length.19 

# Perforation Clusters and Stage Spacing

250 ’ – 500’ Stage Spacing

50 ’ – 100’ Cluster Spacing

Not To Scale20 

# Fluid Selection Utilize core data and lab fluid - rock sensitivity testing to determine fluid additives Maximize slickwater volumes vs. gelled fluid volumes Utilize light gels/crosslink to place higher sand concentrations where necessary in gas shales In liquids rich plays, more gels or crosslinked gels are utilized to promote greater conductivity in the propped fractures Reservoir modeling suggests higher primary fracture conductivity required to improve well performance CHK Promotes development and leads in the use of “greener”, more environmentally friendly hydraulic fracturing additives21 

# Green Frac Status – Chemical Additives Additive Barnett Fayetteville Haynesville Marcellus Eagle Ford Friction Reducer GF* Test GF Test GF Test GF Test GF Test Biocide GF Test GF Test GF Test GF Test GF Test KCl Substitute Eliminated GF Substitute GF Substitute Eliminated GF Substitute Scale Inhibitor GF Test GF Test X X Surfactant Eliminated Eliminated Eliminated Eliminated X Gel X X Occasional X Cross- linker X X Breaker X X Occasional X HCl X X X X X * - 

### Green FracTM22 

# Proppant Selection 100 mesh sand is typically used in the early portion of the job for enhanced distance and height, diversion, etching, and as a propping agent 40/70 and 40/80 mesh proppants are currently the predominant proppants used in gas shales 30/50 and 20/40 proppant used in some areas for fracture conductivity enhancement (especially important in the liquids rich plays) Resin Coated Tail - Ins - used where sand flowback is an issue or where more proppant strength and conductivity are needed Ceramic Proppants are utilized where higher conductivity and higher strength are required Increased proppant volumes and less fluid addresses conductivity and environmental issues23 

# Execution24 

# Hydraulically Fracturing the Shale

Typical Hydraulic Fracturing Job: • 10 - 20 Pumps • 2 -4 Sand Storage Units • Blender • Hydration Unit • Frac Tanks • Chemical Storage Truck • Data Monitoring Van • 20 -30 Workers25 

# Hydraulically Fracturing the Shale 6 layers of protection between the wellbore and groundwater aquifers 

## during hydraulic fracturing operations. Horizontal shale wells are hydraulically fractured at depths that typically exceed a mile beneath the groundwater.26 

# Summary Planning and executing an “optimum” hydraulic fracture requires a multidisciplinary approach of gathering data, confirming data, modeling the optimum fracture and well performance, and executing a plan based on those models. Hydraulic Fracture models do a good job of depicting and/or predicting vertical barriers and thus fracture growth. This data has been, and continues to be, confirmed in multiple ways.

― Microseismic

― Lab Tests

― Core Data27 

# Summary Extensive data collection results in hydraulic fracturing jobs that are designed to remain in the proper formation Remaining in the zone of interest maximizes production and minimizes opportunities to negatively impact production Hydraulic fracturing is a highly engineered process that takes into account numerous variables.28 

# Thank You – Questions?

Tim Beard Sr. Engineering Advisor - Completions
Chesapeake Energy Corporation 6100 N. Western Avenue ı Oklahoma City, OK 76118 ı 405 - 935 -8000 AskChesapeake@chk.com ı chk.com ı NYSE: CHK