Geochemistry and Petroleum Asset Life

Hydrocarbon assets proceed through stages that include basin evaluation, prospect evaluation, discovery drilling, developmental drilling, production, enhanced recovery, abandonment and reclamation. During the progress through this life cycle there are constant changes in the types of information needed to make decisions about developing and managing the asset.

For the asset manager questions continually change. In the earliest stages of asset life, explorationists need to know if the basin contains economic quantities of oil and gas, locations of the largest accumulations, the distribution of oil versus gas, and of oil quality. In later stages, required information includes locations of missed opportunities, reservoir compartmentalization, pay allocation, and proper functioning of production equipment. Production engineers need to know if enhanced recovery techniques are working properly and if reservoirs are fully tapped. Throughout the asset life it is important to assure the environment is being properly preserved.

Tools assist managers to address these questions, with petroleum geochemistry often utilized during the exploration phase. Today, Geochemistry has proven to be a useful tool in all phases of petroleum asset life.

Application of geochemical techniques to oil and gas exploration provide increased understanding of hydrocarbon generation, migration, and accumulation processes within a basin prior to drilling. As more samples become available, geochemical techniques can outline complex basin filling histories, explain unusual oil and gas distributions, and identify the sources of oil and gas. When considered against random drilling, geophysics (trap size) alone provides a forecasting efficiency of 28%, while geophysics in conjunction with geochemistry provides a forecasting efficiency of 63% for locating hydrocarbons during exploration (Sluijk and Parker, 1986). Petroleum geochemistry has proven to be an effective and inexpensive tool for reducing exploration risk.

In applying petroleum geochemistry to exploration problems, a major focus is the analysis and interpretation of the compositions of the complex hydrocarbon fluids. The composition of oil and gas is dependant on many factors, including the original source material, the source maturity, the migration distance, the attributes of the carrier bed, and post accumulation processes such as biodegradation, leakage, thermal stress and water-washing. Each of these processes establishes or alters the fluid composition in predictable ways. Fluid composition can be used to detect and characterize these processes. 

An example of applying geochemistry to determine oil source can be seen in a study of an offshore Tertiary rift basin in eastern Asia (Bissada, Elrod et al., 1993). The basin contains three large deltaic systems along a northeastward trend. Examination of the oil compositions from each of the three systems indicated that the northernmost oil accumulation was sourced from a hypersaline lake facies, while the southernmost was from a freshwater lake facies. The center accumulation has compositional and isotopic characteristics of both types of sources and was determined to be a mixture of the two oil types.

When the geochemical findings were placed in the geologic setting, it was clear that the two oil types were generated from two separate generative troughs and the mixed oil was accumulated on a ridge situated such that it could receive oil from both troughs. The findings had significant implications with regard to further exploration in the area. 

Geochemistry can also be important in assessing the distribution of hydrocarbons in a basin with regard to oil versus gas, high-sulfur versus lower-sulfur oil, heavy versus light oil, and other parameters. This is illustrated by a study done on the Barinas Basin in Venezuela (Anka, Callejon et al., 1998). An integrated geochemical-geologic approach, which included computer simulations, was able to determine that the source of the oil was the more distant La Luna formation, not the nearby La Morita formation, and that the basin had a complex filling history.

The Barinas Basin study revealed that there was an initial pulse of oil that filled the reservoirs, however, the reservoirs were shallow and the oil was subsequently degraded. Next, thrusting rapidly buried reservoirs and source sequences in the northernmost part of the basin. This resulted in cracking of the reservoired oils in the deeply buried sections to condensates and additional gas condensate generation from the local source rocks. Finally, the source in the center to southern parts of the basin is currently mature and expelling oil to the reservoirs above. This filling history explains the distribution of oil in the basin, with gas condensates in the north, lighter oils (initially degraded, then lighter oil added) in the center to southern parts of the basin, and heavy degraded oils in the south.

As we have seen, the processes that result in generation and accumulation of hydrocarbons determine the composition of the fluids and can be characterized based on the fluid compositions. Production and enhanced recovery processes also alter the composition of the hydrocarbon fluids, therefore composition of the fluids can also be used to monitor and characterize production and enhanced recovery processes.

In recent years, geochemistry has been increasingly applied to development, production, and enhanced recovery processes. Petroleum geochemistry is proving to be an effective and inexpensive tool these processes.

Geochemistry can be utilized to identify new or missed opportunities during exploration and development. For example, in some situations, a reservoir can be uplifted or breached resulting in a sudden change in the pressure-temperature relationship in the reservoir. When the conditions are right, this can cause the oil to separate into two phases, with the lighter phase migrating to a shallower reservoir.

The resulting condensate and residue have distinctive geochemical compositions that indicate the phase separation history of the hydrocarbons. When the residue portion of the hydrocarbons is encountered during drilling, it indicates that a lighter phase has migrated up dip and may have accumulated there. Conversely, if the condensate portion were encountered first, that would indicate that a residue hydrocarbon accumulation is likely somewhere down dip.

During production of oil or gas, it is important to understand the geometry of the reservoir, that is, the locations of any faults or permeability barriers that could affect production. Since the reservoirs are filled with fluids and the composition and characteristics of the fluids are sensitive to reservoir processes, we can expect fluids within separated compartments of the reservoir system to have different compositions. In recent years, high-precision analyses of the compositions of oil and gas have been successfully employed to delineate reservoir compartments and communication.

In a recent study (Ramos, Callejon et al., 1999), geochemistry was used to determine reservoir compartmentalization within a gas field in Mexico. Seventeen gas samples from the field were analyzed for component and isotopic compositions. As expected, the gases produced from different fault blocks had different compositions. However, the results revealed significant differences among some gases produced from the same fault blocks. Since the rate of diffusion of gas is relatively rapid, any significant difference was interpreted to be due to a barrier to fluid communication. Thus, the data were used to identify previously unknown barriers to migration within the fault blocks and provided a more in-depth understanding of fluid movement within the field. Subsequent comparison indicated that the geochemical conclusions were consistent with recently acquired 3D seismic data.

Geochemistry has provided key information that distinguished between two geologic interpretations of a field. In the study (Kaufman, Ahmed et al. 1989), the geologic information was ambiguous leading to two interpretations of the location of significant faults in the field. To distinguish between the two models, oils from the producing wells were analyzed and the result presented in a “star diagram,” a plot of the data on a radial axis that enables easy recognition of differences. The results revealed three groups of similar oils that were consistent with one of the geologic interpretations. This clearly indicated that one geologic interpretation was more correct and improved understanding of the field for further development.

Geochemistry can also be useful for planning and monitoring enhanced recovery processes. In a study of the Centro Lago Field, Venezuela (Elrod, Vierma et al. 1997), hydrocarbons from different sand units were analyzed for the purpose of identifying fluid flow units within the reservoirs and optimizing a waterflood project. The data identified barriers to fluid flow that were previously undetected and reservoir connectivity among some of the units that was previously unknown. The results were critical in planning and optimizing a waterflood program in the field.

The fact that hydrocarbon fluid compositions are affected by geologic and reservoir processes is what makes fluid composition useful for studying hydrocarbon generation, migration, and entrapment history. Production and enhanced recovery processes also affect hydrocarbon fluid compositions in predictable ways. Slow or sudden changes in the composition of produced fluids can indicate changes in reservoir characteristics, subsurface fluid conditions, or problems with the production equipment. Periodic monitoring of produced hydrocarbon fluids can identify such changes at low cost. Periodic geochemical analysis of produced fluids has been successfully applied as a useful tool to a number of production issues.

In many wells, oils from different stratigraphic zones are commingled and produced from a single production string. In many cases, legal or ownership requirements will necessitate the monitoring of production from individual commingled zones. Even without those requirements, it is necessary to monitor the production from individual zones to optimized production of from the reservoirs. When there is sufficient (even a small) difference in the composition of the oils from the different zones, periodic geochemical monitoring can be used to determine the production from each zone.

The technique requires only that a small sample of the produced hydrocarbons be taken periodically for analysis. Changes in the composition can identify and quantify depletion of individual zones relative to one another and recognize changes in production related to reservoir or other production problems. The techniques can be applied to a larger number of commingled zones, provided there are sufficient differences amount the oils in the various zones to distinguish each.

Initially, oils from each zone are fully analyzed and the differences identified. After the initial analyses, a smaller number of diagnostic analyses can be used for monitoring the composition of the commingled fluid during production. There are techniques available for monitoring even when samples from the individual zones are not available. Periodic hydrocarbon monitoring data can also be useful when zones are not commingled. In cases where different zones are produced in separate tubing, periodic monitoring of the hydrocarbon fluid composition can detect failures in the production apparatus. 

In one case, a deeper, higher-pressure zone and shallower, lower-pressure zone were being produced through separate tubing. Ownership interests were different for the two zones, so the integrity of the separate production was important beyond the production ramifications. Gas chromatograph (GC) analysis of the oils from the two zones showed that they were clearly different and easy to distinguish. Years later, another GC analysis of the two production oils revealed that they were the same and matched the oil from the high-pressure zone.

Further investigation revealed that corrosion had breached the containment of the high-pressure oil and was allowing it to flow into the lower pressure zone. This meant that the production from both strings had been from the higher-pressure zone since the breach and the owner of the higher-pressure oil had been “giving away” oil to the owner of the lower pressure zone. 

In another case from California, a well was producing solely from the Monterey formation, but the shallower Sisquoc zone had been cemented. During production, fluid was discovered behind the well casing. Analysis indicated that the fluid did not match the oil from the Monterey. Because samples had been taken and analyzed from the Sisquoc prior to cementing, the geochemists were able to compare the fluids and determine that the behind-casing fluid matched the Sisquoc. This indicated that the cement job had failed and the work was redone.

Another problem encountered during production is that of solid deposition and plugging. Asphaltenes, paraffins, and gas hydrates can, under the right conditions, precipitate and cause plugging problems during production. Geochemical analysis of reservoir fluids can quantify and characterize asphaltenes and paraffins and permit prediction of precipitation problems during field appraisal. Recent work also suggests that the evaluation of gas, water, asphaltene, resin, and other surfactant content can enable the prediction of hydrate formation. Prediction of precipitation problems early in the exploration process allows planning and inclusion of costs of specialized production techniques or avoiding problems by selecting production areas that do not exhibit tendencies to precipitate solids. 

Geochemistry is an important element in addressing environmental issues related to petroleum exploration, production and transportation. Keith Kvenvolden (Kvenvolden, 1993) of the USGS performed a study of residual tar in Prince William Sound, following the Exxon Valdez spill in 1989. He gathered tar from beaches and other areas around the sound and used carbon isotopic composition to determine the source.

In 1990, most of the tar samples matched Alaska oil that was spilled from the Exxon Valdez. However, a 1992 sampling yielded mostly tar from California oil. After some investigation, Kvenvolden concluded that most of the tar contamination remaining in Prince William Sound is the result of the destruction of an asphalt storage facility in Valdez by the earthquake of 1964 and subsequent tsunamis. This event spilled large amounts of asphalt into the sound. Since asphalt is more resistant to evaporation and degradation than lighter Alaska oil it has remained, while most of the Valdez oil dissipated.

Geochemistry can be useful in other areas of the petroleum business. For example, a few years ago, Four Star Oil entered litigation with the Internal Revenue Service (IRS) to recover overpayment of taxes. The issue involved whether oil produced from certain wells in California in the early 1980’s was “tar sand” by the IRS definition. A major issue in the definition is whether the oil is produced in its “natural state.” An important point in showing that the oil was not produced in its natural state was to show that it was necessarily chemically altered during production. A geochemical approach was able to show that the oil was chemically altered during steam flooding.

The finding was based on laboratory tests on a number of asphaltenes and on the kinetics of conversion of California Monterey kerogen (which is similar to the asphaltenes found in the oil) to oil. The study demonstrated that a substantial proportion of asphaltenes are converted to lighter, oil-like substances when exposed to the temperatures of the steamflooding for a few hours to a few weeks. This was an important part of the overall case by Four Star that led to a favorable settlement prior to going to court. Geochemistry is a proven tool for managing and monitoring hydrocarbon assets in every stage of asset life. From exploration to enhanced recovery and beyond, geochemistry provides vital information about almost every aspect of hydrocarbon asset management.

Geochemistry is inexpensive, compared to the value of the hydrocarbon assets, investments in drilling and production hardware and compared to other sources of information used. We recommend that geochemistry be utilized at every stage of petroleum asset life as part of an integrated toolbox that includes geophysics, geology, engineering data, and other sources. Intertek Westport has the analytical capability, Total Quality Assurance expertise and experience to address geochemical problems in any phase of petroleum asset life.

How to make Geochemistry an effective tool:
Collect samples: During exploration and development, drilling sediment and all encountered hydrocarbon fluids should be sampled and stored. Sediment should be sampled with cuttings. Organic rich sediments and reservoir intervals should be cored, especially during the exploration phase. Drilling fluids, especially oil-based and those with organic additives, should be periodically sampled as well. All encountered hydrocarbon fluids should be sampled. When possible, reservoir-condition samples are best. Although this will add some cost to drilling, the samples can have enormous value in later stages of asset life.

Analyze hydrocarbon samples when initially taken: Simple compositional and isotopic analyses are not expensive, but can be valuable. For example, an unexpected composition for a sample during development drilling could indicate an undetected barrier to reservoir communication, and indicate that the drilling program may need modification. Alternatively, it might indicate a phase segregation event that could lead to new discoveries in the field. In addition, the analyses provide a baseline for comparison with later production samples and can be useful for monitoring production effectiveness.