Case Study of Two Horizontal Wells for Improved Oil Recovery in New Zealand
Authors: Stoltz L.R. 
Published: December 2007

Summary
Two horizontal wells were drilled in the McKee reservoir to improve oilrecovery by repressing the coning problem experienced in conventional wells. Steps taken to facilitate an optimum completion in the geologically complexreservoir included petrophysical logging to identify fractured zones, cementingthe liner to provide isolation, and selective perforating. Disappointing earlygas breakthrough resulted in lower-than-expected oil recoveries.

Introduction
Today the application and drilling of horizontal wells is common. Because ofreduced costs and risks associated with horizontal drilling, hundreds of thesewells have been drilled successfully all over the world. The main benefits ofhorizontal wells, increased productivity and improved sweep efficiency, havebeen realized in many oil fields. Petrocorp Exploration Ltd. investigated thepossibility of drilling horizontal wells in the northern area of the McKeefield, which is characterized by a large gas cap overlying a thin oil column. Conventional wells in this area are plagued by high-GOR production and low oilrecovery. production and low oil recovery. This paper discusses the reservoirengineering aspects of the two horizontal wells drilled in the McKee field:justification and expectation,drilling and completion method, andperformance and production results. performance and production results. Field History
The McKee field is located onshore Taranaki, New Zealand, some 20 miles eastof New Plymouth. The field is wholly owned and operated by Petrocorp. The fieldwas discovered in Sept. 1979 by the exploration Well McKee-1, and commercialproduction began in Oct. 1981. During 1980–89, the McKee field was developedwith 21 conventional wells from 11 surface locations producing to a centralproduction station. Before production started on the first horizontal well(Jan. 1990), the McKee field produced 10,600 BOPD and 9.0 MMscf/D gas, with a 5% water cut. Individual wells produced at rates from 200 to 1,450 BOPD. Allwells are completed in a single zone with sets of perforations spaced withblank sections to allow possible selective perforations spaced with blanksections to allow possible selective plugging of zones at later dates. pluggingof zones at later dates. In all wells, 2 7/8 -in. tubing has been used withsidepocket mandrels installed in case gas lift valves are needed later forartificial lift. All wells are still producing under natural flow.

McKee Field Description
The McKee field has two separate gas caps and a common water/oil contact(WOC). The gas/oil contact (GOC) is lower in the northern part of the fieldthan in the south. This results in an oil column part of the field than in thesouth. This results in an oil column in the north that is only 190 ft thick, whereas in the south and central areas, the oil column is 761 ft thick. Thedifferent GOC's arise from a saddle. The WOC was established at 7,100 ft truevertical depth subsea (TVDSS). The oil initially in place is estimated to havebeen some 106 MMSTB, and the gas initially in place is estimated at 183 Bscf. The accumulation occurs in the sandstone McKee formation around 6,562 ft belowsea level in one of several overthrust structures found in the Upper Eocene/Oligocene marginal marine sediments of eastern onshore Taranaki. Itbelongs to the Kapuni group and represents the last of a series of coastaltransgressions. The reservoir is sealed by the overlying marine claystone ofthe Turi formation and by the overthrust fault that juxtaposes the reservoirwith the Miocene marine claystone of the Mohakatino and Mahoenui formations. The McKee sand is, on average, some 230 ft thick. Although it has a homogeneousappearance superficially, it is heterogeneous on a larger scale. Thisheterogeneity results from the presence of subtle variations in grain size, thin calcareous-cemented beds, small-scale healed faults and fractures, andindistinct sedimentary structures. Reservoir quality suffers from significantdegradation of primary reservoir properties resulting from diageneticprocesses. processes. In the northern half of the field, the sand isinterbedded with a band of shales and thin coal beds that gradually thickentoward the north. This feature, known as the Intra McKee shale. divides the McKee formation into Sands A and B. Sand B averages 39 ft thick and is, onaverage, of poorer quality than Sand A. Most effective permeabilities to oilmeasured from well tests range from 15 to 20 md.