Interpreting reservoir talk
`from: Offshore Engineer
`by: Andrew McBarnet
`Thursday, September 04, 2003
`
`The talk in the seismic business these days is ali about
`the reservoir. But, as OE seismics editor Andrew
`McBarnet reports, reservoir in this context is a term
`
`open to wide interpretation.
`
`
`Just about everyone in the geophysical industry agrees that the reservoir
`is where things are headed from a technology point of view. Less clear is
`whether there is a business model to support the current thinking.
`
`For all sorts of reasons - short term Wall Street considerations being a
`big one — oil companies today are looking to optimise recovery of oil and
`gas from existing fields rather than spend the dollars on higher cost
`exploration. The notable exception would be the deepwater, frontier plays
`in areas like West Africa which are delivering huge finds that justify the
`risk investment, itself a luxury that only the supermajors and a few
`others can afford.
`
`Preoccupied with survival in an overcrowded market, it has taken time for
`the seismic business to absorb and respond to the trend. The most
`obvious shift in emphasis has come from WesternGeco, the joint venture
`between Schlumberger and Baker Hughes which holds the lion's share of
`the marketplace. The company has become increasingly upfront about
`committing its seismic capabilities to reservoir delineation and production
`monitoring. It's a business decision as much as a technology one.
`
`Dalton Boutte, new president of WesternGeco who replaced Gary Jones
`earlier this year, has repeated his predecessor's disillusion with the
`overcapacity in the main business of seismic exploration. Boutte has
`publicly complained that the company's competitors did not follow
`WesternGeco's lead in cutting the size of their seismic fleets, and he is
`also unhappy that a whole bunch of newcomers have showed up on the
`scene introducing extra streamer capacity which inevitably depresses the
`market. WesternGeco is not giving up on conventional streamer—based
`marine seismic, but you can be sure that it will avoid the speculative
`scene that has caused so much grief and instead stick to profitable
`contract work and properly funded multiclient projects.
`
`WesternGeco's answer is to concentrate as much of its effort as possible
`on what it calls differentiating technologies such as Q-Marine and Q-
`Reservoir, which it believes can give the company a measurable edge
`over the competition. Q technology is the outcome of a huge R&D effort
`within Schlumberger begun nearly 10 years ago in anticipation of oil
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`WESTERNGECO Exhibit 2111, pg. 1
`PGS V. WESTERNGECO
`IPR2014-01475
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`WESTERNGECO Exhibit 2111, pg. 1
`PGS v. WESTERNGECO
`IPR2014-01475
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`industry interest in a next generation seismic acquisition system which
`could deliver more accurate, higher resolution imaging data.
`
`Q introduces improvements in receiver sensitivity and positioning
`accuracy, steerable streamers, enhanced source control and point(cid:173)
`receiver acquisition, which is the real innovation distinguishing Q-Marine
`from other acquisition systems. Q is based on the principle of measuring
`every single recording sensor rather than taking the conventional route
`summing traces from groups of sensors. No one in the Industry seriously
`doubted that Qtechnology would offer better, more repeatable images.
`Shell geophysicists in the 1980s were the first to seriously moot the Idea,
`but concluded it was not feasible at that time. Only the step changes in
`hardware and processing capability of recent years have enabled the
`vision of one receiver channel per hydrophone to be realised.
`
`Predictably the launch of Q technology in 2000 was met with a certain
`amount of scepticism, some of it competitor inspired, but also fuelled by
`doubts about the cost benefits which linger today and also by the
`perceived lack of examples of successful applications.
`
`Three years on, Q technology has begun to win some Important
`advocates as Its relevance to reservoir characterisation and monitoring is
`being realised, particularly in the 40 time lapse environment where
`survey repeatability Is key, and In 4C projects where data imaging
`improvements need to be commensurate with the extra cost and effort of
`an ocean bottom survey.
`
`Most heartening for WesternGeco has probably been Its contract from
`Statoil for the first aptly named 4D Q-Reservoir survey over the Nome
`field in the North Sea. WestemGeco carried out a baseline survey using Q
`technology in 2001 and this summer repeated the survey over the Norne
`reservoir to enable a Q-on-Q comparison. Following the survey the job of
`the geoscientists and engineers has been to analyse any visible changes
`in the reservoir since the first survey. The information should reveal how
`the reservoir Is being drained and point to where new production wells
`should be drilled. First reports out of WestemGeco are that the operation
`went well.
`
`Ole Magnar Oroenen, Statoil's petroleum technology manager for the
`Nome field, explained at the time of the contact award last April that a
`survey was needed if oil recovery from Nome was to increase above SO%
`He said Q technology was chosen because of the repeatability provided
`streamer steering and minimum azimuth variation between base and
`monitor survey. In addition the survey team was able to get closer to the
`Nome production vessel than would have been possible with conventional
`equipment thanks to streamer steering. This reduced the area where no
`coverage was possible.
`
`WestemGeco has four Q technology vessels, of which the Geco Topaz and
`Westem Neptune have been earmarked for surveys this year on three
`Exxon Mobil assets in West Africa, the Gulf of Mexico and the North Sea.
`Most recently, in July, WestemGeco undertook a 200km2 30 survey usi
`
`WESTERNGECO Exhibit 2111, pg. 2
`PGS v. WESTERNGECO
`IPR2014-01475
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`the Q-Marine system on ChevronTexaco’s Captain field in the outer Moray
`Firth of the UK North Sea. The operator said it was looking for a clearer
`picture of the Captain field internal reservoir architecture for identifying
`further drilling targets as well as wanting to evaluate Q technology for
`possible use on other ChevronTexaco assets.
`
`WesternGeco appears to be comfortable, or may be realistic, in believing
`that in the short term the main players for Q, 4D, 4C, OBC and other
`sophisticated technology for extracting more value from seismic data are
`likely to be the big companies, who don't need to be convinced of the
`benefits, have the money, and in fact control most of the acreage where
`such spending will occur.
`
`It's also no coincidence, according to Steve Pickering, marketing manager
`for the WesternGeco reservoir services group, that the North Sea has
`been the proving ground for Q technology and for that matter 4D seismic.
`‘These technologies are key enablers as governments and oil companies
`try to maximise recovery of resources from mature provinces. But we are
`seeing the methods being extended to earlier and earlier phases in the
`life cycle of the reservoir as their value is appreciated. We can expect
`them to be adopted at the very beginning of future deepwater field
`developments in the Gulf of Mexico and West Africa.’
`
`The recognition being earned by Q technology appears to be triggering a
`reaction from Petroleum Geo-Services (PGS), the second largest marine
`seismic contractor and the one most likely to come up with competing
`technology. PGS is now positioning its HD3D product as a cost effective,
`ie cheaper, streamer-based acquisition alternative to Q technology. PGS
`believes that the high density sampling system incorporated in HD3D,
`achieved with its Ramform class vessels using a single as opposed to a
`dual source acquisition system, can produce results comparable to Q
`technology and well able to satisfy the stringent parameters being set for
`4D surveys projects.
`
`It's not necessary to benchmark the merits of the two approaches to
`conclude that the focus of some significant seismic business is moving
`towards smaller surveys over known reservoirs, particularly in the more
`mature provinces where operators are under pressure to identify and
`recover every last possible drop of hydrocarbons. Smaller scale has in fact
`encouraged the emergence of start-up Norwegian companies like
`Multiwave Geophysical and Inseis Terra to offer specialised survey
`services in the 4C domain and in Mu|tiWave's case 4D.
`
`
`
`Chris Usher, PGS vice president market systems and support, says that
`the company has had its eye on the reservoir services side of the
`business for some time. ‘People probably thought the migration of
`services into the reservoir would go more quickly. There is definitely a
`transition of reservoir engineers using seismic much more as a reservoir
`analysis tool than they did previously.’ Usher points out that PGS is part
`of the team involved in BP's Valhall Life of Field Seismic (LoFS) involved
`in the processing of 4D data (OE July).
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`WESTERNGECO Exhibit 2111, pg. 3
`PGS V. WESTERNGECO
`IPR2014-01475
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`WESTERNGECO Exhibit 2111, pg. 3
`PGS v. WESTERNGECO
`IPR2014-01475
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`For people like Richard Cooper, president, Rock Solid Images, the
`potential value of seismic for improved reservoir characterisation is old
`news. His company along with a handful of others are part of an evolving
`market which takes the inversion of seismic data as the starting point for
`developing software solutions and services which integrate seismic data
`with well data. Although in the armoury of the big geophysical
`contractors, this is not a key priority for them at the moment.
`
`‘We would go as far as to say that much of the attention being paid to
`producing better seismic data stems from asking the wrong question,’
`says Cooper. ‘The real issue is whether all this improved information will
`lead to a better well. Geophysicists deal with seismic which will always be
`a relative rather than an absolute calculation. Real engineers want a
`quantitative approach with measurable values. So the only practical way
`forward is to integrate the seismic and well data.’
`
`Seismic inversion itself has been in the reservoir geoscience repertoire for
`20 odd years, but its value as a new window into the reservoir is only
`being properly appreciated now with the availability of improved seismic
`data and more powerful computers. In essence the purpose of seismic
`inversion is to transform normal seismic reflection data into quantitative
`rock property parameters which describe the reservoir. Presented in this
`form the data can be better interpreted in terms of reservoir properties
`such as porosity, fluid saturation and net pay. Most importantly the rock
`properties derived from the seismic can be integrated with other reservoir
`parameters such as well log data and other geologic data to produce a
`better model and understanding of the reservoir. Advocates of seismic
`inversion also make the point that turning seismic into a ‘layered’
`interpretation makes it a more acceptable currency for the whole asset
`team including reservoir engineers.
`
`Rock Solid Images practises what Cooper preaches and specialises in the
`application of rock-physics for integrating and calibrating seismic and
`borehole data to provide geologic insight and reservoir understanding at
`all stages of the oilfield lifecycle. It is a young company, founded in 1998
`though the merger of the Discovery Bay Company, Seismic Research
`Corporation and Petrosoft, which has enjoyed considerable growth. Since
`its inception, it has performed in excess of 200 service projects for a
`broad range of customers including national oil-companies, majors,
`super-majors and larger independents. The company has a close
`relationship with the Stanford Rock Physics group and technology
`partnerships with Magic Earth, Seismic Micro-Technology, and Voxelvision
`for the distribution of its ATl'RIB3D software.
`
`Cooper is a little perplexed by the fact that the market for his company's
`style of reservoir characterisation is much stronger in Europe, even
`though the number of potential customers is much smaller. About the
`only other company in the inversion business in North America is
`Hampson Russell, recently acquired by VeritasDGC, which then last month
`sold at a substantial loss its Reservoir Characterization Research &
`
`Consulting (RC)2 subisidary to Seismic Micro- Technology.
`
`
`
`
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`WESTERNGECO Exhibit 2111, pg. 4
`PGS V. WESTERNGECO
`|PR2014-01475
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`WESTERNGECO Exhibit 2111, pg. 4
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`IPR2014-01475
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`For a brief period Rock Solid Images, based in Houston, was working in a
`friendly alliance with the Danish oil industry software developer Qdegaard
`in a bid to broaden its international market reach.
`
`Qdegaard can legitimately claim to have been one of the first in the field.
`However, managing director Kim Gunn Maver says that a great deal of
`persuasion is still required to convince oil companies to spend the money
`on his company's technology for extraction of rock properties from
`seismic data through well log analysis, seismic inversion and timelapse
`prediction in seismic reservoir characterisation. ‘We are focused on
`extracting maximum value from available seismic data and believe that
`this technology will pay major dividends to oil companies, particularly
`small companies trying to squeeze the last drop of oil out of their assets.
`Compared with five years ago, the technology seems to be accepted but
`in some cases we are still losing out when it comes to spending priorities.
`
`I
`
`The most high profile company in this emerging niche market for
`reservoir characterisation is Jason Geosystems, which was acquired two
`years ago for Euro10O million by the Fugro Group and now forms an
`integral part of its geoscience division. Jason works from the proposition
`that major decisions about reservoir development are made using
`information gleaned from seismic, geologic and well log data, all of which
`have inherent problems that can hinder a true understanding of the
`reservoir. For example, seismic data provide excellent areal coverage but
`poor vertical resolution, whereas well logs offer excellent vertical
`resolution but poor areal coverage.
`
`Jason’s solution revolves around its Geoscience Workbench reservoir
`
`characterisation product offering technology which quantitatively
`combines seismic, and well log data with geological, petrophysical and
`geostatistical information to generate reliable lithology and rock-property
`models. It is intended to allow companies to make realistic estimates of
`reservoir volume and hydrocarbon distribution and to make appropriate
`reservoir management decisions based on the analysis.
`
`The last word goes to Paul de Groot of dGB (de Groot-Bril Earth Sciences)
`based in The Netherlands, another of the companies which is in the
`business of predicting rock properties, inverting seismic volumes to
`acoustic and eiastic impedance, process and interpret seismic object
`probability cubes. From a university research background, the company
`has been gradually building its client base, mainly in the North Sea. The
`company has worked closely with Statoil and other industry groups while
`developing some of its signature software.
`
`De Groot says there is a general trend toward taking the possibilities of
`seismic inversion more seriously, especially in the North Sea where the
`geology is relevant and companies want to maximise the return on their
`investment in what is regarded as a high cost area. ‘People want to
`believe in the technology and there are enough case studies out there to
`prove it. A problem we have is that the technology is complicated, and it
`requires a balanced understanding of geophysical and geological issues.
`We are beginning to find that oil companies just don't have the expertise
`
`WESTERNGECO Exhibit 2111, pg. 5
`PGS V. WESTERNGECO
`|PR2014-01475
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`WESTERNGECO Exhibit 2111, pg. 5
`PGS v. WESTERNGECO
`IPR2014-01475
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`WESTERNGECO Exhibit 2111, pg. 6
`PGS V. WESTERNGECO
`IPR2014-01475
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`WESTERNGECO Exhibit 2111, pg. 6
`PGS v. WESTERNGECO
`IPR2014-01475