CO2 EOR Economics for Small-to-Medium-Size Fields

Abstract

SPE Members Abstract CO2 projects undertaken in the past have generally been large fields that benefited from economy of scale and substantial remaining life. Future CO2 Projects will generally not have these advantages. However, since the CO2 source and distribution infrastructure are in place, many smaller oil fields may be candidates for CO2 enhanced oil recovery (EOR). This paper investigates the economic viability of conducting CO2 EOR operations in small to medium-size fields under today's market conditions. The evaluation uses actual production data from a representative CO2 project, current costs to equip the field for CO2 operations, and operating costs in the actual range of ongoing projects. Sensitivity to these factors plus depth and porosity acre-feet are discussed. The economic impact of EOR tax incentives are also considered. Each potential EOR project must be evaluated for its specific conditions. Rate of return and cost values cannot be directly applied to other EOR projects, but can be used as a guide to relative profitability. Introduction CO2 EOR has proven to be an effective way to recover oil reserves that could not be recovered through primary or secondary methods. EOR projects undertaken in the past have generally been large fields that benefited from economy of scale and substantial remaining productive life. Many oil fields that are candidates for EOR projects today are smaller, more mature fields and, thus, do not provide economy of scale or substantial remaining life. However, because the CO2 source fields and pipeline distribution systems are now in place, today's EOR projects do not have to bear the extremely high costs of implementing these functions. Consequently, more smaller fields can be considered for EOR today than in the past. The study presented in this paper was performed to determine if CO2 EOR projects can be economically performed in small to medium-size fields. The production histories of many existing field-scale CO2 EOR projects were also reviewed for their similarities and differences. From this group, six typical projects involving two fields from each of three different geological formations (San Andres, Devonian, and Sandstone) are presented. To determine the economic viability of EOR projects in small to medium-size fields under today's market conditions, an economic base case was built. The actual EOR production history of one of the smaller fields, Enron's Twofreds East side, was used as the production schedule in building the base case. The current costs to equip the field for CO2 operations and operating costs in the range of actual costs of existing projects were used for the economic projections. P. 195^