Drilling-Campaign Optimization Using Sequential Information and Policy Analytics

Abstract

Summary Optimally designed drilling campaigns are essential for improving oil recovery and value creation. They are required at different stages of the hydrocarbon-field life cycle, including exploration, appraisal, development, and infill. A significant fraction of the revenue risk comes from geological uncertainty, and for this reason, subsurface teams are frequently responsible for optimizing campaign parameters such as the number of wells, the corresponding locations, and the drilling sequence. Companies use the information and learning from drilled wells to adapt the remainder of the campaign, but classical optimization methods do not account for such learning and flexibility over time. Accounting for sequential geological information acquisition and decision making in the optimization of drilling campaigns adds value to the project. We propose a method to optimize drilling campaigns under geological uncertainty by using a sequential-decision model to obtain the optimal drilling policy and applying analytics over the policy to obtain the optimal number of wells and corresponding locations. The novel contribution of policy analytics provides better access to information within the complex data structure of the optimal policy, providing decision support for different decision criteria. The method is demonstrated in two different cases. The first case considers a set of eight candidate wells on predefined locations, mimicking the situation where the method is used after a prior subsurface optimization. The second case considers a set of 12 candidate wells regularly scattered in the same area and uses the method as the first optimization approach to filter out less-attractive regions. Exploiting the geological information on a well-by-well basis improved the expected campaign value by 65% in the first case and by 183% in the second case. The value of spatial geological information and value of flexibility from having more drilling candidates are two byproducts of the method application.