bluuebunny/crossref_metadata_2025 huggingface dataset:
Criteria for Surfactant Selection in Micellar Flooding
Authors: Salter S. J.
Published: December 2007

A review of how surfactant molecular structure affects those properties which determine micellar process performance is presented. Surfactants for both low and high salinity applications are considered. Those factors which contribute to the formation of polysulfonated petroleum sulfonates are discussed. A variety of approaches to formulation of synthetic sulfonates are contrasted, and the important factors of molecular structure are delineated. Finally, several approaches for application in high salinity/hardness reservoirs are described.
Successful Primary Cementing: Fact or Fiction
Authors: Smith R. C.
Published: December 2007

The producing performance of a well depends in great part on a good primary cementing job. In a high-quality cement job, all mud and gas channels have been permanently prevented and there is a complete hydraulic seal between the casing and the formation throughout the zones of interest. If the cementing operation is not carried out correctly, the well will never reach optimum performance. A successful primary cementing operation requires a positive attitude and commitment, proper supervision and quality control, detailed planning, and careful preparation. This paper discusses the application and interaction of these aspects of the job, as well as other factors that contribute to successful cementing. Examples of unique quality control procedures are included. The actual mechanics of performing a cementing job are not covered; they can be obtained from references included in the paper.
Prediction of Static Elastic/Mechanical Properties of Consolidated and Unconsolidated Sands from Acoustic Measurements: Basic Measurements
Authors: Montmayeur H. , Graves R. M.
Published: December 2007

Accurate knowledge of static rock properties is required to study sand production control, fracturing, casing design, and depletion of reservoirs. A high pressure cell allows simultaneous measurements of acoustic velocities, strains, and pore volume changes of cores under varying hydrostatic or biaxial stresses. Rock properties computed from static measurements are a function of the stress history. Theories allowing the correlation between dynamic and static properties are suggested.
Comprehensive Reservoir Study and Management Through Effective Geological and Engineering Teamwork
Authors: Chan M. C. F. , Springer S. J. , Burrowes G. O. , Klappa C. F.
Published: December 2007

This paper presents a field study of a carbonate reservoir using geological and numerical simulation models. The paper emphasizes the importance of developing an accurate reservoir description through the joint efforts of geologists and engineers.

The field study (Clive pools, Alberta, Canada) incorporated data from a geological study, interference study, material balance study, field-wide simulation study, and hydrostatic-hydrodynamic pressure analysis. The geological study provided input data for the numerical model and the calculation of the original hydrocarbon pore volume. The interference study helped verify the theory of pressure interference among the producing pools and predict future pressure behavior. Hypothesis and deductive reasoning were required in the material balance study to define the aquifer behaviour.

Petrophysical data from recent infill wells have been used to verify and update the existing geological-reservoir model. The model will be used to continuously optimize production strategy and evaluate the technical feasibility of enhanced oil recovery using a hydrocarbon miscible displacement process.
A Dynamic Computer Model of a Kicking Well: Part II—Model Predictions and Conclusions
Authors: Nickens H. V.
Published: December 2007

The response of a kicking well for representative kick situations has been calculated using the dynamic model described in Part I: "The Theoretical Model". Kick size, gas distribution, control method, casing shoe position, shut-in procedure and choke control procedure are considered and the resulting effects on the casing shoe and surface casing pressure are presented.

The increase in surface pressure as the distributed gas migrates under shut-in conditions is also calculated. The resulting rate of increase of surface casing pressure gives an apparent gas rise velocity of 1000 ft/hr, consistent with the field rule-of-thumb, although the actual, rise velocity is about 2000 ft/hr for distributed gas.
An Approximate Theory of Oil/Water Coning
Authors: Wheatley M. J.
Published: December 2007

The problem of water coning into a partially-penetrating oil well is considered. An analytical theory is developed which approximately describes the flow of oil into the well in the presence of a cone of water beneath the well. In particular, a procedure is given for computing the critical oil production rate.

Results for critical rate are presented for a range of formation thicknesses, penetration ratios, drainage and well radii and horizontal to vertical permeability ratio. Comparisons are made with other data available in the literature.
A New Approach to Differential Sticking
Authors: Courteille J. M. , Zurdo C.
Published: December 2007

This paper presents a new theorical and experimental study of the forces involved along the pipe/cake/formation triple bond when differential pressure sticking has been established.

This has been done by recording the pressure at differents points of the pipe/cake and cake/formation interfaces in a laboratory device reproducing the drilled hole conditions. Results show that the resistance at any point of the pipe/cake/formation bond is mainly affected by the pore pressure existing at that point.
Evaluation of Low-Resistivity Simpson Series of Formations
Authors: Schulze R. P. , Ives G. L , Smalley E. A. , Smith W. E.
Published: December 2007

Units of the Simpson series of formations are evaluated by means of computing both a "textural" parameter, W, and the volume of mud filtrate that has displaced fluids originally present in the formation. This analysis is performed primarily through the use of response equations for an electromagnetic wave propagating through the formation. The first computation uses the interval transit time and the resulting solution for Sxo. The second one uses the attenuation of the wave.

The textural parameter is used as both m and n in Archie's equation for water saturation. The m and n values agree with the range of values reported in core measurements for the Simpson. The resulting water saturation computations agree with production from examples.

Computing the volume of moved fluids leads to a prediction of the amount of connate water displaced by the mud filtrate. This, in turn, leads to predictions about the water that the well will produce and a rough idea about the bulk volume of irreducible water.

These predicted and computed values agree fairly well with production from examples. The Simpson series in Oklahoma is often characterized by low-resistivity pays, and the resistivity from an induction log is typically low in these formations. The water saturations computed from Archie's equation using m=n=2 are very high and are often in disagreement with production. Two very real possibilities for this disagreement are the use of wrong values for m and n and the presence of high bulk volumes of irreducible water. The techniques described in this paper help solve these two problems.
Sodium Carbonate Preflush Theoretical Analysis and Application to Chateaurenard Field Test
Authors: Rivenq R. , Sardin M. , Schweich D. , Putz A.
Published: December 2007

In a previous paper1 we described the mechanisms of oil recovery by the microemulsion injected in Chateaurenard (France) micellar/polymer field tests. The calcium gradient created through the micellar slug as a result of cation exchanges between micelles, water and clays has been shown responsible for both high displacement efficiency of the microemulsion and trapping of surfactant in residual oil.

The efficiency of the same microemulsion is improved if calcium is removed ahead of the micellar slug and if the calcium gradient is replaced by a salinity gradient. In this paper we describe how this can be achieved by using a sodium carbonate preflush which induces precipitation of calcium from the clays as calcium carbonate.

A series of sandpack displacement tests have been carried out, both with and without oil present, to study the effect of a sodium carbonate preflush and to understand the mechanisms involved in such a process. Experimental results have confirmed that use of a 5g/l Na2CO3 preflush can increase the oil recovery rate up to twice its value without preflush, depending on preflush size and quantity of microemusion injected, and reduce correspondingly retention of the surfactant.

In order to interpret these tests a numerical simulator has been elaborated. It takes into account the dispersive properties of the sandpacks and the significant interactions between minerals and fluids. A good agreement between preflush displacement tests and simulations has been achieved using measured input parameters.
Pressure Transient Analysis for High-Permeability Reservoirs
Authors: Cinco-Ley H. , Samaniego-V. F. , Viturat D.
Published: December 2007

Field experience has shown that pressure data measured in extremely high permeability reservoirs (kh ~ 106md-ft) are affected by wellbore effects such as storage, temperature changes, reservoir pres sure trend and noise in pressure measurements. These effects are particularly important in light of the small pressure response observed during a well test. The present work presents methods to analyze pressure drawdown and buildup tests performed under the influence of unknown linear reservoir pressure trend (m*). For a drawdown test a graph of t dpwf/dt vs t yields a straight line of slope m* and intercept m (semilog slope); for a buildup test a graph of dpws/dt vs tp/∆t(tp+∆t) gives a straight line of slope m and intercept m*. Field cases are presented to illustrate the application of this method and the effects of different wellbore phenomena; both surface shut-in and bottomhole shut-in examples are included.
Design of the Harmony and Heritage Platforms for Offshore California
Authors: Irick J.T. , Ruhl G.L. , Tucker M.C.
Published: December 2007

The Harmony and Heritage platforms are planned by Exxon Company, U.S.A., for installation planned by Exxon Company, U.S.A., for installation offshore California, in 1200 feet (366 m) and 1075 feet (328 m) of water, respectively. The design criteria and analysis procedures are an extension of the technology used for the 850-foot (259 m) water depth Hondo platform, about ten years ago. Each of various in-place (environmental) and installation loadings are discussed, and their relative impacts on jacket weight are evaluated.

Introduction

Exxon Company, U.S.A.'s Hondo platform was installed in the Santa Ynez Unit in the Santa Barbara Channel in 1976. The design and construction procedures of this 850-foot (259 m) water depth platform (which are described in References 1 and 2) have evolved to meet the additional challenges presented by the Harmony and Heritage platforms, the next developments for the Santa Ynez Unit. As shown in Figure 1, the Harmony platform will be located about 3 miles (4.8 km) west of the Hondo platform, and the Heritage platform will be located about 7 (11.3 km) miles west of Harmony. Pipelines are planned to extend from Heritage to Harmony, to Hondo, to a terminal.

Like Hondo, both platforms were designed by Exxon Company, U.S.A., with extensive support by its research affiliate, Exxon Production Research Company. Designs for a one-and two-piece option and for a Far East and West Coast jacket assembly are essentially complete. The anticipated schedule for the platform jacket design and construction is shown in Figure 2. To capture economies of scale, design and fabrication of the Heritage platform is planned to be simultaneous with that for Harmony, and water phase construction will be sequential. phase construction will be sequential. PHYSICAL FEATURES PHYSICAL FEATURES As shown in Figure 3, the Harmony and the Heritage platforms are similar to the Hondo platform. They are all 8-legged, pile founded platform. They are all 8-legged, pile founded structures for the support of drilling rigs, production equipment, and personnel quarters. production equipment, and personnel quarters. The size of the new platforms prohibits the use of any existing fabrication yards on the U.S. West Coast. Also, no existing barge is capable of carrying either jacket as a single unit across the Pacific. Thus, to encourage competitive bidding and launch barge development, both one-piece and two-piece (like Hondo) jackets were designed and offered to potential fabricators. potential fabricators. The deck structures on Harmony and Heritage are essentially identical. They are three-level modular decks, atop a module support frame. The deck plan is 180 feet by 145 feet (55 m by 44 m) with a total area of about 78,000 square feet (7300 m2). Two drill rigs and 60 well conductors are planned for each platform. The total topside weights above the module support frame is about 40,000 kips (mass 18,100 Mg) for each platform.
Time-Dependent Flow Behavior During Immiscible Displacement in Porous Media
Authors: O'Steen B. L.
Published: December 2007

Previously reported experimental results for oil/water displacements in Berea sandstone are reexamined in an attempt to better understand the observed behavior. Contrary to the original interpretation of these results, it is concluded that traditional Buckley-Leverett theory, including capillary dispersion and hysteresis effects, is incapable of even qualitatively describing the observed displacement behavior. This failure of Buckley-Leverett theory is attributed to the inability of Darcy's law to adequately describe multiphase flow in the vicinity of a flood front. A simple time-dependent expression for the fractional flow is proposed, at a heuristic level, to explain the experimental results and support the assertion of unsteady flow. The conservation and proposed flow equations, in linearized and in characteristic forms, are analyzed to deduce the basic solution behavior. Numerical solutions are also presented. The theoretical results are found to qualitatively reproduce many of the observed displacement features.
Fracturing a High-Permeability Oil Well at Prudhoe Bay, Alaska
Authors: Hannah R. R. , Walker E. J.
Published: December 2007

This paper details a successful fracturing of a high permeability oil well at Prudhoe Bay, Alaska. The treatment was complicated by the zones proximity to water, poor leak-off control and the need for a large quantity of proppant.

A calibration treatment was performed prior to the proppant laden treatment to verify the leak-off coefficient and to determine height growth tendencies. This treatment indicated a grossly higher fluid loss rate than the pre job estimate and a more conservative treatment was designed. Temperature/gamma logs indicated the redesigned treatment would not propagate to the water zone.

The treatment was pumped successfully and the well cleaned up and responded to the treatment with a productivity increase of 1.33 out of a maximum theoretical of 1.6. This is considered good for a fracture of such modest dimensions.
Measuring Capillary Pressure and Relative Permeability in a Single Centrifuge Experiment
Authors: O'Meara D. J. , Crump J. G.
Published: December 2007

Two of the most important properties governing reservoir fluid flow are relative permeability and capillary pressure. Unfortunately, conventional techniques for measuring one are not without complications from the other. Worse yet, these complications become particularly inextricable for flow experiments on the short core samples typically available for analysis. The advantage of the present method is that it simultaneously measures both properties in an experiment where their effects have been largely decoupled.

The present method entails using an automated centrifuge to measure fluid productions at several speeds and history-matching the production data with the aid of a numerical simulator. Although history-matching problems are, in general, not well posed, the present case is exceptional. In each speed step the asymptotic production is determined only by capillary pressure and the transient behavior is determined mainly by relative permeability. Consequently, the effects can be distinguished.

A numerical simulator, tailor-made for centrifuge experiments, is presented along with typical results of history-matching. The error in a conventional capillary pressure is also estimated.
The Application of the Cubic and Quadratic Forchheimer Equations in the Design of High-Rate, Gravel-Packed Gas Well Completions
Authors: Buell R. S. , Crafton J. W.
Published: December 2007

The addition of the cubic term to the quadratic Forchheimer equation is evaluated in the design of high-rate, gravel-packed, gas well completions. The impact of the cubic term on the Rawlins and Schellhardt1 back pressure plot, non-Darcy plot as used by Jones et al.2 and Himma-tramka,3 and the rate sensitive skin plot as used in references 4 and 5, is evaluated. The authors conclude that high-rate, gravel-packed gas well completions can be designed with sufficient accuracy under field conditions without the inclusion of the cubic term. An example calculation is done using the cubic term to illustrate its effect. A design procedure is presented for inside casing gravel pack design.
Well Testing With a Non-Newtonian Fluid in the Reservoir
Authors: Huh C. , Snow T. M.
Published: December 2007

When a reservoir contains a non-Newtonian, polymer-containing fluid such as those injected during a surfactant or polymer flood, well test data cannot be interpreted using conventional well-test theory. This is because fluid viscosity depends not only on the distribution of polymer within the reservoir, but also on the non-Newtonian rheology of the polymer-containing fluid. A well testing method which accounts for both the polymer concentration distribution and non-Newtonian rheology is presented.

For the method presented here, the pressure transient equation is solved together with the polymer transport equation to obtain the pressure response for any assumed radial distribution of polymer within the reservoir. An optimization technique is then employed to give the best fit to the field data. Thus, for a given distribution of polymer in the reservoir, appropriate formation parameters -- porosity, permeability, and thickness -- can be deduced. Conversely, with the known values of formation parameters, an attempt can also be made to obtain the approximate distribution of polymer within the reservoir. Unlike previous solutions for non-Newtonian rheology, the non-linear character of the equations is preserved. Also, an adaptation of the Carreau model, which describes the polymer rheology more realistically than the commonly-employed power-law model, is used. Application of this new method to interpret field data is discussed with examples.
The Dual Dipmeter Service in High-Resistivity Formations
Authors: Donovan M. P. , Nelson R. F.
Published: December 2007

This paper presents examples of dipmeter data in high-resistivity formations in the Appalachian and Michigan basins. Tool selection and operational techniques to maximize data quality in very resistive sections are discussed. Interpretation of computed dips in the examples is presented.
A Microcomputer-Based Oil and Gas Consultant System
Authors: Rieke H. H. , Perry R. D.
Published: December 2007

The purpose of this article is to introduce, to the independent oil and gas operators, the concept of a microcomputer-based consultant system that employs interactive video. An interactive computer-video system is a powerful information tool. It has many applications in exploration, drilling, completion, stimulation, production, and business aspects of the petroleum industry.

Such an interactive computer system conviently provides the rules and knowledge required to improve and to maintain the quality of work in a particular discipline. This unique software/ hardware application integrates all activities which are mandatory in improving the oil and gas production potential of exploration and development wells. It can be simply described as an intelligent video workstation employing a structed electronic approach for handling the day-to-day field operations and business activities. Now, the microcomputer can be effectively used as a cost saving aid in decision making and problem diagnosis. The system will furnish the small operator with the same capabilities as those possessed by large oil companies.
Well Control Practices for Air-Drilled Holes
Authors: Willis R. B.
Published: December 2007

The fast paced and hydrostatic-free nature of air drilling presents unique problems when blowouts are encountered. Well control practices for air drilling lag considerably behind techniques applied for fluid drilling. The formation at the surface casing shoe is commonly the weak link during killing operations and any well control plan must protect against shoe breakdown. The technique described below is based on monitoring pressures at the choke manifold to keep pressures at the shoe below breakdown pressure. In the field, air drilled well control requires rugged, easy to maintain equipment and a simple well control plan.
Wellsite Determination of Bottomhole Condition for Rod Pumping Wells
Authors: Wilkins D. S. , Yu J. P. , Puon P. S. , Huddleston K. L.
Published: December 2007

Sucker rod pumping is one of the major oil recovery systems in the Appalachian area. In order to analyze the performance of a pumping well, the bottomhole condition of the well should be monitored. The pressure at the formation in a well should be known at different conditions. In addition to determining the producing and static bottomhole pressure, the study of the pressure build-up when a well is shut-in is important. There are several methods for obtaining this pressure build-up data. The acoustical liquid level instrument has been traditionally used to locate the liquid level to determine if the well is "pumped off". The depth to the liquid level can be used to calculate the producing bottomhole pressure. The same calculation can be utilized to monitor the bottomhole pressure during a well test. These pressures may then be used to determine the skin damage present in a well. Substantial work is now being done by several companies with acoustical build-up tests. This paper reviews skin damage and the application of methods to test for its presence.
A Study of Reservoir Parameters Affecting Gas Well Spacing in West Virginia
Authors: Aminian K. , Ameri S. , Saradji M. S. , Locke C. D.
Published: December 2007

Well spacing has a significant effect on gas reservoir deliverability optimization. A single well seldom provides the desired rate of production from a given reservoir. Generally, the total rate of gas production increases with the number of the wells completed in the gas reservoir. At the same time, inter-well interference tends to reduce this increase in total rate of production as the number of producing wells are increased. Consequently, there must exist a well-spacing which will result in the most efficient recovery from a natural gas reservoir. This optimum well spacing depends upon the producing formation characteristics as well as economics of field development.

The overall objective of this paper is to provide a general guideline based on reservoir engineering principals for efficient well spacing pertaining to gas producing formations in West Virginia. The objective was achieved by developing a general reservoir model which simulates the flow of gas in a reservoir containing several wells. The model was then used to study the parameters which affect well interference and spacing. The model has the advantage of also accounting for the inertial component of pressure drop in gas flow through porous media, a factor which was found to affect well interference.

Reservoir data pertaining to Big Injun and Benson formations were collected and interpreted. The interpreted data were statistically analyzed and the results were utilized in conjunction with the model to provide general guidelines pertaining to spacing for gas wells producing from these two horizons in West Virginia.
Testing CO2-Foam for Mobility Control at Rock Creek
Authors: Heller J. P. , Boone D. A. , Watts R. J.
Published: December 2007

This paper reports the objectives, design and progress of a field test of "CO2-foam" as a lowered mobility displacing fluid. It includes the background of mobility control considerations leading to the trial, and describes the influence on it of various operational conditions and constraints. The Rock Creek oil field of Roane County, West Virginia, has been produced since 1906 from a low permeability sandstone with high clay content, and is now near the end of economic life. The area utilized in this test is a smaller portion of two ten-acre five-spots that have been subjected to a conventional CO2 flood and subsequent waterflooding, in addition to gas recycling and primary production. A major goal of the test was to determine whether the oil remaining in this area could be displaced by a slug of thickened CO2 to form a mobile oil bank that could be detected at a nearby observation well. A second goal was to test the injectivity of CO2-foam as liquid CO2 and dilute surfactant solution were pumped simultaneously down fiberglass tubing into the injection well. The design of the test was based on published measurements of the ability of the chosen surfactant (Alipal CD128) to form a foam-like dispersion with liquid CO2, on stability at reservoir temperature (73°F; 23°C), on the extent of adsorption onto the reservoir rock, and on the appropriate values of the relative mobility of the CO2-foam (0.2 cp-1). Although it has been possible to inject the target quantity of CO2 foam, the injection of chase water has not yet been completed.
OPEC and Adam Smith
Authors: Roberts M. L.
Published: December 2007

Unless OPEC can discipline itself to production levels that will result in the spot price of crude being equal to or greater than the contract price of crude, the demand for OPEC crude, along with the price of crude, will continue to erode for the remainder of the decade.

Because of the quantum jump in energy prices during the 1973-74 and 1979-80 periods, certain irreversible forces have been set in motion that have changed the structural demand for energy. These forces have resulted in a decline in energy demand per real GNP in the major industrialized nations of in excess of 24%, indicating price elasticities of between −0.3 and −0.5. This suggests that, regardless of the strength in the economies of the nations of the industrialized world, an "off oil" policy has been put into place through conservation, efficiencies, substitutions, and new technology. Moreover, superimposed on this major structural change in demand for petroleum has been the amount of nonOPEC oil and nonpetroleum supplies coming into the market at an annual rate of 1.0-2.0 million BD per year.

The bottom line to these structural changes is pressure on OPEC to reduce production and/or prices in order to maintain its viability as an organization. Failure to exercise the discipline or proration suggests that Adam Smith's Economics 101 will continue to wind down oil prices for the remainder of the decade and possibly beyond.
Energy Policies in Europe
Authors: Cleutinx Christian
Published: December 2007

Christian CLEUTINX is principal administrator with the Commission of the European Communities. He is presently based in Washington, D. C. where he is responsible for energy, industrial policy and environment affairs. He joined the Commission in 1975 and has successively been in charge of European coal investment policy and energy analysis and forecasts. Before that he held responsibilities in the fields of marketing and production planning with Petrofina and Raychem Corporation. He holds a degree in Economics and Finance and a Master's degree in Business Administration.

Thank you Mr. Chairman. May I also immediately thank the Society of Petroleum Engineers for giving me the opportunity to participate in such a prestigeous symposium. As an official of the Commission of the European Communities my presentation will concentrate on energy policies as developed within the European Communities.

As an introduction, it might be useful to review briefly the functioning of what is generally known as the European Common Market. The Community traces its origins to the Treaty of Paris, signed in 1951, to create a European Coal and Steel Community. The idea behind this Treaty was that the pooling of coal and steel production would immediately provide for the establishment of common bases for economic development as a first step in the Federation of Europe. The six founding Member States – Belgium, Germany, France, Italy, Luxembourg and the Netherlands – decided that this experiment, which proved a significant success, should be deepened and extended to embrace their entire economies. In 1957, they signed the Treaty of Rome setting up the European Economic Community (EEC) and the European Atomic Energy Community (EURATOM). Over the years, six other countries – Denmark, Greece, Ireland, The United Kingdom, Spain and Portugal – joined. This enlarged Community which accounts for 2 0 percent of world trade has a population of 320 million people and a GNP slightly larger than that of the US.
Oil in the Soviet Union and China: Problems and Prospects
Authors: Ebel R. E.
Published: December 2007

The production of crude oil in the Soviet Union fell dramatically in 1985, for reasons unrelated to the world market. Major deficiencies confront the industry, most importantly, the absence of large new discoveries to offset production declines at the older fields. Authorities have scheduled production increases through 1990, but these increases appear to be beyond reach.

For the People's Republic of China, crude oil output has been demonstrating modest growth in recent years. Plans for 1990, however, call for a major increase in production during the coming five years. Prospects for meeting the plan goal are uncertain, against the background of disappointing offshore developments.

General guidelines for the planned development of energy supply for both the Soviet Union and China are presented, and the probable role of both as exporters of crude oil in future years is discussed.

A series of tables presents actual, estimated and planned levels of activity for the petroleum industry of both countries, through the end of the Century.
Impact of Petroleum Industry Recapitalization Upon Integral Material Suppliers
Authors: Foster J. D.
Published: December 2007

The monumental impact of mergers, acquisitions, divestitures and recapitalization within the oil and gas industry has dealt far reaching trauma well outside itself. This calculated rush over the past five years to substitute debt for equity and use cash to reduce shares outstanding has gotten a significant portion of its capital from one of the industry's mainstays--drilling and exploration. One can directly relate this as being a primary component to the free fall in the national rig count and all its ensuing ramifications within an already ailing segment of the big picture: manufacturers of downhole tubulars and oilfield related service companies.
Cogeneration Financing Issues
Authors: Dalnoky J. J. , David A.
Published: December 2007

Cogeneration is not new to the chemical and petroleum industries, which have been traditional heavy users of both steam and electricity. The enactment of the Public Utilities Regulatory Policies Act of 1978 (PURPA) permitted private unregulated production and sale of electrical power and required the purchase of that power by the electric utility which serves the area in which the facility resides. This law has created a renewed interest in the chemical, refining, enhanced oil recovery and other industries as a means of reducing overall costs in a very competitive environment. The purchase price of the power under PURPA is established by the law to be the avoided cost of the purchasing utility for the next unit of power. The exact method of determining this "avoided cost" has been hotly debated by cogenerators, utilities and public utility commissions throughout the country.

With the current declining prices of various forms of energy, utilities' "avoided costs" have also declined. Decreases in residential and industrial use of electric power and an increase of industrial production of power have slowed the rate of growth in electrical energy demand. This has resulted in utilities being faced with dismissing plans for new generating facilities and cutting back production from existing higher cost facilities. These factors have a negative effect on the economics and development of new cogeneration facilities.

The economics of cogeneration vary with the input fuel, the capital cost, the operating cost, the fuel structure of the purchasing utility, and many other factors inherent to such facilities. Therefore, the financing of cogeneration facilities may be accomplished by many different financing structures. Several structures, which have been used to date, are construction and term financings which include leveraged leasing and off-balance sheet joint venture partnerships. Various factors for financing such as guarantees, tax issues, clawbacks, escrow funds, and other mechanisms are addressed and explained. Sensitivities of fuel prices on gas-fueled projects are explored.
Financing Mergers and Acquisitions
Authors: Sobotka S. P.
Published: December 2007

This paper will discuss some of the developments that led to the surge in mergers, acquisitions, and restructurings that began a few years ago. It will conclude that forces affecting oil companies made some companies more valuable to others than standing alone. Mergers were useful because they brought about a desirable balancing of risks. Consequently, financing was available. The paper will also conclude that the incentives for mergers did not create profit opportunities in takeovers. Finally, we shall suggest that the incentives for mergers were greater in the first part of this decade than earlier and probably have largely disappeared, or at least substantially decreased in the last year.

Mergers were not events peculiar to the petroleum industry. But the magnitudes and characteristics of the assets involved in these events in the petroleum industry suggest that this industry was particularly impacted by the changes in economic conditions or views of economic conditions that brought on the mergers, acquisitions, and restructurings that took place or were attempted in several industries. So we need first to look for developments in industry generally and in the entire economy that might help explain what happened.

During the period of inflation that began in the 1960s and ended in the early 1980s, real interest rates (quoted rates minus inflation) were very low by historical standards. That made it appear unusually attractive to hold assets for long-term appreciation because interest rates were so low that there had to be rather little appreciation in real terms to make the holding of assets worthwhile. Oil in the ground, other natural resources (renewable and not renewable), and even developed and undeveloped land, all were relatively inexpensive to hold. Indeed, during a part of that period, realized real interest rates were negative. Thus, even the holding of assets that were subject to considerable price risk or whose prices were declining slowly appeared attractive. Companies in many industries as well as individuals reacted to these incentives by greatly increasing their holdings of assets. This does not mean that petroleum companies necessarily increased the volume of their reserve holdings. But the values of these holdings relative to the values of other assets rose greatly in the case of a good many companies.
The Economic Impact of Take-or-Pay Settlements
Authors: Yurkevicz G. A.
Published: December 2007

The following paper examines the economic impact of recent take-or-pay settlements on the stock prices of Panhandle Eastern Corporation (Panhandle) and Columbia Gas System, Inc. (Columbia). The analysis indicates that each company's stock price was positively affected by settlement of its take-or-pay claims. Each company outperformed both the market and a comparison panel of its industry peers during trading periods surrounding the announcement date of each settlement. The data suggest that by eliminating these financial claims, both companies positively altered their competitive position in the gas transmission industry.
Avoiding International Double Taxation in the Petroleum Industry Since 1969
Authors: McCarthy J. R.
Published: December 2007

All industrialized countries recognize the principle that the country in which a business activity is conducted has the first right to tax the income from that activity. At the same time, international double taxation of those earnings is recognized as an evil to be avoided if the business activities of a given country's citizens are to remain competitive.

As Professor Peggy Musgrave, a longtime student of these matters, recently observed:

Overlapping taxation … is universally condemned on economic grounds. I believe that every economist who has thought at all seriously about the matter recognizes that overlapping taxation discriminates against multi-jurisdictional firms in favor of purely local firms, hampers the free flow of capital to areas where it could be employed most effectively, and impairs economic efficiency. I "know of no scholarly argument against the proposition that overlapping taxation should be avoided.
Stimulating Carbonate Formations Using a Closed Fracture Acidizing Technique
Authors: Fredrickson S. E.
Published: December 2007

Many carbonate formations cannot be successfully fracture acidized at pressures above the formation fracture pressure using standard fracture acidizing techniques. This situation exists because standard techniques rely on acid etched, uneven removal of the fracture face to produce fracture flow channels or fracture conductivity. Many times the etched fracture face is either too smooth, softens with acid, or the formation strength itself is insufficient to prevent closure due to overburden pressure, as in chalk formations.

The "closed" fracture acidizing technique is designed to allow acid to flow through existing "closed" fractures below fracturing pressure in a channelling manner. Wide grooves or channels in the fracture face are then formed as acid is pumped at low rates and allowed to dissolve large flow channels. These grooves tend to remain open with good flow capacities under severe closure conditions and also allow fines or emulsions to be more easily produced. The initial fractured system can be natural fractures, previously created fractures, or fractures created and etched just prior to the "closed" treatment.

Laboratory test results on formation cores and field results verify this technique.
A Case History of Refracs in the Oak Hill (Cotton Valley) Field
Authors: Hunter J. C.
Published: December 2007

Under certain circumstances, restimulation of tight gas sand wells may provide an excellent investment opportunity. Graham-McCormick Operating Partnership conducted a refracturing program within the confines of the Oak Hill (Cotton Valley) Field which may provide insights for other operators contemplating similar work.

This paper explores the criteria used to identify refrac candidates and examines the important considerations in the design process. A well-by—well discussion describes implementation of the treatments and evaluates post—frac performance. Refrac economics are reviewed in the closing section
Polymer Flood Operations: East Texas Field
Authors: Miglicco T. P.
Published: December 2007

The W.H. Siler Lease is located at the southernmost end of the East Texas Field where solution gas drive is the predominant source of energy. In this paper, the overall polymer augmented waterflood performance will be briefly discussed and aspects of the equipment and fluid design will be addressed; however, the primary interest will concern the operational problems and facility design modifications during the course of the project.

Unique problems were encountered with designing the polymer skid and overall system. A method of mixing and injecting the polymer and monitoring the polymer injection facility had to be devised. Special fittings, valves and piping were required to minimize corrosion and polymer crosslinking. Polymer storage tanks and a circulation system were required and designed to prevent water condensation, settling of the polymer, and to provide a means of measuring tank levels. Other operational problems occurred such as quality control on deliveries, transfer pump failures, mixing problems in the storage tanks, and voltage fluctuation problems. Also, various attempts to clear the formation sandface of polymer utilizing sodium hypochlorite and nitrogen jetting will be discussed.
A Novel Approach for Developing Drilling Fluids Systems
Authors: Greene K. E. , Wang M. K. , Cannon N. E.
Published: December 2007

The primary purpose of this paper is to demonstrate methodology in choosing a drilling fluid system when certain formation characteristics are known. Formation analyses of several shales have been completed and are the basis for this paper. These formations are located along the Texas and Louisiana Gulf Coast, providing some of the most reactive shales to their drilling fluid environment.

Composition of the Travis Peak Formation and analyses of fluid systems to drill this formation will also be advanced. The procedures for testing the drilling fluids environments will be presented. Several companies have used these techniques in selecting drilling fluids programs with much success. Principles of shale stability will be reviewed.
New Gorilla Jackup for Deepwater or Harsh Environment
Authors: Shetti B.
Published: December 2007

The specific purpose of the paper is to reveal the facts about the new generation Gorilla Jack-up and its usage in the U.S. Gulf of Mexico up to 450 feet water depth.
Drilling Technology Application: 15,000-Ft Water Depth
Authors: Hammett D. S.
Published: December 2007

This paper introduces new technology which extends the capability of drilling in 15,000 ft. water depth for the purpose of gathering Earth Science data. The application of the petroleum industry experience to drill in these water depths has lead to a successful first year of operation of the Ocean Drilling Program (ODP). The program has commenced coring the ocean floor to learn more about the earth. The program will be conducted worldwide during the next 14 years utilizing the drillship SEDCO/BP 471. Several modifications were performed in order that the ship could effectively use all available technology. A re-entry system is utilized so that the ship can core into the earth's crust approximately 8,000 feet. Several types of new scientific and drilling equipment will be utilized in this program.

The major thrust of ODP is to gain scientific knowledge of the earth's crust and ocean floor. For the first time, hardware and technology developments have been mandated in the mission. ODP will develop new tools and technology for deep ocean exploration and drilling. These tools and techniques will include: Small diameter downhole motors, coring devices, long drill string design, re-entry devices, and bits. The ODP is administrated and supervised by Texas A&M University.

The technology exchange between the scientists and drilling industry is a key part of the 14 year program. In addition to Earth Science this program will provide data for future energy sources. The ODP has the potential to provide more useful data for mankind's life on Earth than the Space Program has produced.
Triaxial Casing Design for Burst
Authors: Kastor R. L.
Published: December 2007

A closed form Triaxial Design procedure has been developed based upon the von Mises' criteria using the Lame' equations. This contrasts with the conventional biaxial procedure using Barlow's equation. The results of using the new procedure are compared which demonstrate the importance of incorporating the radial stress.

It is concluded the Triaxial Design procedure should be used when surface pressures exceed ±12,000 psi. This is based on comparing a series of designs for surface pressures ranging from 3,300 to psi. By first designing these strings using the Biaxial/Barlow approximation and then checking them with the Triaxial/Lame' procedure, it is noted that the Biaxial/Barlow design is in considerable error above ±12,000 psi and may be unsafe above ±15,000 psi.

It is also concluded that equivalent safety requires different values of Design Factor for Biaxial vs. Triaxial procedures.
Submudline Drivepipe Whipstock: A Cost Effective Method of Reclaiming Platform Slots
Authors: Provance S. M.
Published: December 2007

On an offshore platform, once a wellbore has been junked or a reservoir depleted, reclaiming that slot for future drilling work can be costly and time consuming. A Submudline Drivepipe Whipstock (SDW) allows an old wellbore to be plugged and abandoned, and new drive pipe driven, making the slot available for the drilling of a new well in an expedient and cost effective manner. Using the SDW eliminates the slow process of washing over and pulling existing casing strings to obtain a window suitable for kicking off below existing drive pipe. Although the first SDW used by ARCO Oil and Gas Company required two attempts to be installed properly, five have been successfully used since that time. The purpose of this paper is to describe the SDW, the process used to install it and to illustrate the reduced time and cost effectiveness of reclaiming a platform slot in this manner.
Drilling With a Parasite Aerating String in the Disturbed Belt, Gallatin County, Montana
Authors: Westermark R. V.
Published: December 2007

Drilling for oil and gas in the Overthrust and Disturbed belts of the Rocky Mountains has received considerable attention in recent years. Zones having low pressure gradients are frequently encountered, when drilling in the mountains. Operating companies and drilling contractors have learned to respect lost circulation problems.

This paper discusses Phillips Petroleum Company's approach for controlling this problem in a well drilled in Gallatin County, Montana. Using compressed air down the drill pipe to lighten the drilling mud's hydrostatic pressure is an accepted method of combating lost circulation. A parasite aerating string is a tubing string attached to the outside of the surface or intermediate casing and is used to inject air into the casing-drill pipe annul us. Reduction in hydrostatic pressure to effective mud weights of 6 ppg (719 kg/m2) or less can be obtained with the proper air/mud ratios and the correct setting depth of the air injection point.

A parasite aerating string offers several advantages over using an air-mud mixture down the drill pipe:

Ease of operation, no special procedure needed for making connections or trips. No changes in downhole equipment are required. Conventional bit hydraulics can be used. Air does not contact the open hole. Corrosion is limited to the coolest section of the hole and only above the injection point.
Addressing Choke Control Deficiencies Through Computer-Based Electronics
Authors: Thompson S. , Harbour D.
Published: December 2007

The scope of this paper will be to review the technology used in contemporary choke control systems, and in particular, to examine the deficiencies of these systems. A well-control system recently developed by TOTCO will be used as an example of how computer-based electronics can successfully address many of these problems.