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BHP Billiton - The New Era of Shale
 

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    BHP Billiton - The New Era of Shale BHP Billiton - The New Era of Shale Document Transcript

    • Contents | Zoom in | Zoom out For navigation instructions please click here Search Issue | Next Page The New Era of Shale BHP Billiton Petroleum SUPPLEMENT TO ®Contents | Zoom in | Zoom out For navigation instructions please click here Search Issue | Next Page
    • qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® Contents 2 The Company 4 Operating Principles 6 The Growth of U.S. Onshore Oil and Gas 10 Building the Wells 12 The Move into Shale 14 The Eagle Ford Shale 22 The Permian Basin 26 The Haynesville Shale 30 The Fayetteville Shale 34 Zero Harm 36 Good Neighbors 38 Avoiding Potential Roadblocks 40 Company Profiles qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® “Every time we look at the opportunities in our shale oil and gas plays, they get larger. MIKE YEAGER CHIEF EXECUTIVE BHP BILLITON PETROLEUM We know the resources are there. Our job is to deliver them safely and in an environmentally responsible way. We are in this business for the long haul, and we are going to do it right.” qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®2 BHP BillitonThe CompanyHouston-based BHP Billiton Petroleumdelivers nearly one fourth of the annual earningsof the BHP Billiton Group.BHP Billion Petroleum’s exploration, development, Philippines, India, and Malaysia. Between 2007 andproduction, and marketing activities span more than 2011, BHP Billiton Petroleum brought five world-classa dozen countries. The company holds significant developments on stream.positions in the deepwater Gulf of Mexico andonshore United States as well as in Australia, the The company entered the onshore shale business with the $4.75 billion Fayetteville Shale acquisition in April, 2011, but that wasUnited Kingdom, Algeria, Trinidad and Tobago, and just the first step. It strengthened its U.S. onshore position later inPakistan. It also has promising prospects in the the year through the $15 billion acquisition of Petrohawk EnergyBHP Billiton Petroleum’s Seismic Processing and Imaging Team has numerous technology projects with research institutions around the world. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 3BHP Billiton Petroleum’s Shenzi deepwater platform in the Gulf of Mexico began production in 2009.Corporation, which gave it major stakes in the Haynesville, Eagle BHP Billiton Petroleum has close to 4,000 employees globally,Ford, and Permian basins to complement its Fayetteville position. and is deeply committed to their safety. The company has theSince then, the U.S. onshore workforce has doubled. BHP Billiton systems in place to ensure its employees return home unharmedPetroleum operates some 45 land drilling rigs in the United States in at the end of the day, and it continually strives to improve itsaddition to its deepwater drilling around the world. sterling safety performance.BHP Billiton Petroleum is now among the largest independent As a global producer, exporter, and consumer of energy, BHP Billitonoil and gas companies in terms of both its total production and understands the need to conserve energy and the risks of climateresource base. Its shale assets in North America are some of the change. Since 2006, it has achieved an 16 percent reduction inmost valuable, high-quality resources in the world. greenhouse gas emissions per volume of production, exceeding its public target of a six percent reduction by 2012.The company’s business is built on a powerful platform ofrigorous safety standards, high quality oil and gas resources,functional excellence, operating discipline, and financial strength.It has the people and skills to take on complicated and diverseopportunities, and the flexibility to move quickly to deliver valuein any environment. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®4 BHP BillitonOperating PrinciplesThese five basic operating principles shape everythingBHP Billiton Petroleum does as a company and serveas its pledge to local communities.1. To be the safest company in the industry We are committed to restoring the environment when we complete our operations to ensure it is We carefully develop and rigorously implement safety as healthy and robust as before we arrived. and operating systems, properly train our people, and will not compromise our behavioral standards. 3. We will safeguard and manage water resources We only work with contractors who share our commitment to safety. We minimize our impact on fresh water by utilizing alternate sources wherever possible. We partner with local communities to prepare them to respond to unplanned events. We do not dispose wastewater into any surface source (streams, lakes, rivers).2. We will protect the land where we operate We do not drill or conduct hydraulic fracturing operations unless we are confident that groundwater will be protected. We install and operate our wells and facilities in the most environmentally sensitive manner. 4. We will minimize air emissions from our We look for opportunities to drill multiple wells from a single pad to reduce the size of our surface footprint. operations We conduct environmental assessments prior to We conduct our operations in a manner the execution of work to properly plan for and that minimizes flaring and venting. minimize the impacts of our operations. We use alternative or cleaner-fuel source technologies. We have one of the most modern and operationally efficient drilling fleets in the onshore industry. 5. We will be a good neighbor to our communities We look for ways to make our operations less intrusive to the community. We publicly disclose the chemicals that are used in our hydraulic fracturing operations. We work with state and local officials to find workable solutions to common industry problems. We give back to the community in a meaningful way through social investment and partnerships. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 5Safety is BHP Billiton Petroleum’s primary concern. The companyrecognizes that the business of finding, extracting, and deliveringhydrocarbons is full of potential hazards, and its commitment tothe safety of its employees and contractors is one reason that,statistically, they are less likely to be injured at work than they arein their own homes.Every employee and contractor, no matter what their position, hasthe right and obligation to speak up if they have doubts about anyactivity. If they can’t be certain of the task at hand, they are requiredto either stop the job or do whatever it takes to ensure their ownsafety and that of those around them.Is the approach working? Yes. In its U.S. onshore operations, manyof the safety standards established by BHP Billiton Petroleumhave improved not only its own safety performance, but that of itscontractors and other operators as well. Eagle Ford Drilling and Completions Manager Michael Bloom prepares a group of journalists for a drillling rig site visit. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®6 BHP BillitonThe Growth of U.S.Onshore Oil and GasIt’s no secret that recent advances in hydraulicfracturing and well completion are opening vastnew oil and gas resources. The biggest fields byfar are in North America. An increasing portion of BHP Billion Petroleum’s North American portfolio consists of what are known as unconventional oil and gas plays. While shale oil and shale gas are considered unconventional resources, the term refers only to the source rock, not the high-value liquids and natural gas that come from it. Two basins in particular, the Eagle Ford and the Permian, account for about 40 percent of all the unconventional oil and gas activity in the United States. What are shale and tight gas reservoirs? In conventional reservoirs, hydrocarbon molecules are able to squeeze between the grains of relatively porous rock. Above that porous zone, however, there must be what geologists call a “trap” or “seal” to keep the oil and natural gas from migrating all the way to the surface. Shale reservoirs are different. Shale and other “tight” reservoirs don’t need traps and seals, because the source rock itself is the trap. Hydrocarbons are caught within pore spaces that are significantly smaller and more restrictive, and are also absorbed onto the clay mineral particles that make up the shale. The only way hydrocarbon molecules can move around is through natural and artificial cracks. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 7A matter of scaleOne of the biggest differences in shale oiland gas fields is the large number of wellsneeded to extract the resource. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®8 BHP BillitonAn abundance of opportunity exists in shale in the lower 48 states.Source: Energy Information Administration based on data from various published studies. Updated: May 9, 2011.Geologists have long been aware of the oil and gas contained in out the small operators and forcing changes within the industry.shale, but didn’t have a way to recover it economically. That changed That’s nothing new in the oil and gas business. What’s importanton a significat scale in the mid-2000s, thanks to improvements in a to remember is that discovering, producing, and delivering50-year-old technology known as hydraulic fracturing, or “fracing” hydrocarbons is a long-term venture. Fields take years, evenfor short. Fracing uses water pressure to create networks of tiny decades, to develop. The wells being drilled now will be productivecracks in the rock. To hold them open, sand and minute amounts of for at least the next 30 years.a gel-like thickener are added to the water. At the end of 2012, the company’s onshore holdings stood at 1.6But what about market changes? million acres. Since it will take 20 years just to develop the shale resources it knows are in the ground, the fields themselves will beAfter BHP Billiton Petroleum acquired a stake in the U.S. shale active for at least the next 50 years. Few industries have lead timesoil and gas industry, the price of natural gas in the United States as long as this, or capital expenditures as large.dropped to the lowest level in years. Such low prices are squeezing qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 9The drillers control room, known in the industry as the “dog house,” on one of BPH Billiton Petroleum’s brand new Eagle Ford rigs built tocompany specifications.Supply and demand drives the market. While the United States now What about liquids production?has an oversupply of natural gas, Europe and Asia do not. Thatwill likely change in the next few years as more liquefied natural By the end of 2012, BHP Billiton Petroleum’s onshore fieldsgas (LNG) receiving terminals in the United States are converted to were delivering 270,000 barrels of oil equivalent per day to U.S.export terminals. When it becomes relatively easy to export natural customers. The hydrocarbons are a mix of oil, natural gas, andgas, world prices should be more uniform. natural gas liquids in the current market, the liquids sell for more than dry gas. Since many of the company’s onshore fields haveOther factors are changing the market as well. Low prices are the capacity to produce more than 50 percent liquids, it has theencouraging some electric power producers to shift from coal to gas, flexibility to leave the dry gas in the ground for now and keep itsand chemical plants are increasing capacity to take advantage of the crews and equipment busy producing more liquids, including cruderelatively low cost of natural gas liquids. The demand for natural gas oil, which continues to sell at strong prices.and natural gas liquids is certain to grow in the United States, thelargest and most mature market in the world. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®10 BHP BillitonBuilding the Wells At the surface After geologists and reservoir engineers determine where the wells should be, crews level the site, construct a lease road, erect the drilling rig, and place support facilities on the pad. For efficiency, and to minimize disturbance at the surface, BHP Billiton Petroleum typically drills and completes several wells from a single pad, directing each wellbore to a different part of the target zone. When the wells are to be hydraulically fractured, an array of large trucks, pumps, storage units, and control systems will be brought in for several days. Once all the wells are completed, the perimeter of the site is restored as close as possible to its original condition, leaving only a minimal surface footprint. Surface drilling and casing Drillers start a new well by drilling a hole to a depth of approximately 80-100 feet, and installing a large-diameter pipe called a conductor casing, which is then cemented in place. Protecting the water table Once the conductor casing is set, drilling continues to a depth that state regulatory agencies determine is well below the level of any fresh ground water. The heavy pipe called surface casing is then installed and cemented in place by pumping cement down the pipe. The cement circulates to the bottom of the surface casing and rises back to the surface on the outside of the casing, forming another layer of protection and strength. Horizontal drilling Shale wells are usually completed with a horizontal section. As the wellbore continues downward and it approaches the target shale, drilling engineers guide the drill bit, curving the borehole until its path is horizontal or nearly so. The finished hole may run horizontally for a mile or more through the hydrocarbon-rich layers of rock. Production Casing The drilling phase is finished after drillers install and cement an additional set of piping from the bottom of the well all the way back to the surface, forming yet another barrier between the rock and the inside of the well. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 11 Manufacturing wells In most shale fields, operations continue around the clock. Depending on the reservoir, wells typically take 10-20 days to drill. BHP Billiton Petroleum drills several wells from each pad in a manufacturing-like process.Perforating Hydraulic FracturingIn a critical part of the completion phase, portions of the production Because shale is too dense for hydrocarbons to flow through itcasing are perforated by a series of small explosive charges, creating on their own, the wells are stimulated by pumping in fluid—holes that are about an inch in diameter and extend as far as usually water and thickeners—and sand under very high pressure.18 inches into the surrounding rock. These perforations provide a Downhole, the fluids push out through the perforations into theconduit for fluid and sand to be pumped into the reservoir during the rock formation. The pressure is great enough to break the rock andfracing stage, and afterward allow hydrocarbons into the wellbore release hydrocarbon molecules from microscopic voids in the shale.so they can flow or be pumped to the surface. The sand, called proppant, holds the fractures open so the fluids can flow into the wellbore and to the surface. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®12 BHP BillitonThe Move into ShaleThrough purchases in 2011,BHP Billiton Petroleum acquired majorpositions in four of the largest onshore oiland gas fields in the United States.Two of the assets are what the industry calls liquid- People know usrich, which means the hydrocarbons they produce BHP Billiton Petroleum’s onshore acreage in the United States liesare largely oil and natural gas liquids, as opposed in regions where people have a long history in the oil and gasto dry gas. In some areas, the proportion of total business and the industry is an important part of the economy.liquids production is as high as 80 percent. The At the end of 2012, the company was producing 270,000 barrels ofcompany’s holdings in shale basins across Texas, oil equivalent per day from these onshore fields. That number will grow throughout 2013, driven by more than $4 billion in drillingLouisiana, and Arkansas contain some 8.0 billion and completion and facility development.barrels of oil equivalent, a U.S. domestic resourcethat we will be producing over the next 50 years. Using local contractors, BHP Billiton Petroleum is building the infrastructure to bring valuable gas and liquids to market. In 2012, it installed some 140 miles of new pipeline in the Eagle Ford and Permian shales, and is building another 200 miles of pipeline in 2013. Over the next few years, the company will add six new processing plants and lay about 800 miles of pipeline in the Eagle Ford alone. Development in the Permian includes some 600 miles of pipeline, as well as gas dehydration, compression, and cryogenic facilities. These large, long-life, and low-cost assets hold tremendous volumes, with potential for significant future development. Together, they make BHP Billiton Petroleum one of the industry leaders in some of the most productive shale basins in the United States. BHP Billiton Petroleum’s size and scale give it the flexibility to respond to market conditions. In financial year 2012, the company adjusted its shale development plans to focus on oil rather than gas, while maintaining its capability to ramp up in the future when natural gas prices rebound.A diversified portfolio of onshore oil and gas opportunities providesextraordinary flexibility to respond to changes in the market. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billi on 13 BHP Billiton 13 P Billiton ll n Home-grown energy BHP Billiton Petroleum works closely with landowners to minimize its footprint. Shale proving to be an economic boon to the U.S. – 1.75 million jobs created in past few years. – New jobs expected to grow to 3 million in 2020. – $2.5 trillion in government revenue by 2035. – Nearly 2% of U.S. GDP over next three years. Source: U.S. Chamber of Commerce qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®14 BHP BillitonThe Eagle Ford ShaleHydrocarbons in economic quantities werediscovered in the Eagle Ford shale in 2008.Since then, the region has become the epicenterof shale operations in Texas, and one of thepremiere plays in North America. The Eagle Ford spans more than 400 miles of south-central Texas. The heart of the play is about 50 miles wide and has an average thickness of 250 feet. It is a giant resource that will be productive for many years to come. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 15 qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®16 BHP Billiton BHP Billiton Petroleum’s average hydrocarbon production from the Eagle Ford, which includes the Black Hawk and Hawkville fields, is over 50 percent liquid hydrocarbons. With an attractive product mix of condensate and natural gas liquids, the Eagle Ford Shale is rated among the lowest cost plays in North America. As a result, the economics of dry gas have much less effect on company activities. “The rigs are working flat-out,” says Eagle Ford Production Unit Manager Steve Pastor. “Our success is due in part to the fact that we’re in the sweet spot of the basin. Geologically, it is among the best of the best.” According to a study by the independent research and consulting group, Wood Mackenzie, BHP Billiton Petroleum has the second most valuable position in the Eagle Ford.The Eagle Ford includes a vast rural area of south-central Texas.Hydraulic fracturing at night in the Eagle Ford Shale. Drilling and completions operations run non-stop, lessening America’s dependence onforeign oil and gas. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 17The field produces three products. First is the crude oil andcondensate, which is a high-value lighter form of crude oil. Nextis dry gas, which can often go straight into interstate pipelines BHP Billiton Petroleum’sand be sold directly into the market. Between the two are natural Technology Goalsgas liquids—ethane, propane, butane, and pentane—which are • Model and understand production complexitiestypically separated out in gas processing plants. associated with nano-permeability reservoirsIn 2012, BHP Billiton Petroleum produced nearly 100,000 barrels ofoil equivalent per day from the Eagle Ford Shale, with half of that • Lead the industry in the development of staticbeing hydrocarbon liquids and the rest, dry gas. In the next few and dynamic shale reservoir modelsyears, the company aims to produce 300,000 barrels equivalent perday from the Eagle Ford. Six new processing plants will be needed to • Improve hydraulic fracturing efficiency,handle the volumes. BHP Billiton Petroleum will be adding 800 miles development planning, and ultimate energyof pipeline, and has already spent more than a billion dollars on the recoveryinfrastructure. • Identify, assess, and implement breakthroughReservoir modeling technologyCommercial amounts of hydrocarbons were discovered in the EagleFord Shale in 2008. The region has since seen an extraordinaryamount of development as one of the premiere shale plays inNorth America. What BHP Billiton Petroleum brings to the tableis financial strength and technical depth to make the most of thisoutstanding resource.“If we can unlock the secrets of the Eagle Ford, we can apply that technology elsewhere around the world.” Vice President of Development Planning Rob Kase. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®18 BHP Billiton“We are now working on dynamic reservoir models of the field,”says Rob Kase, Vice President of Development Planning. “That’swhat we do for conventional reservoirs, but it has never been donein a shale like the Eagle Ford. “Reservoir models are computer-based simulations of a field’sgeology. Specialists construct them using seismic data andinformation from wells. Dynamic 3D models help engineers andgeoscientists predict how fluids will move through a reservoir.Accurate models help them plan the location of new wells anddevelop strategies for enhancing recovery.The reason no one has created a dynamic model for a shale reservoiris that the permeability of the rock is so much less than it is in aconventional oil and gas reservoir. The rock is so “tight” that someof the parameters geoscientists would use to model a conventional Eagle Ford Production Unit Manager Steve Pastor (left) with Eaglereservoir just don’t apply. Ford HSEC Supervisor Harry Barnes.“The conventional approach is difficult to use in the Eagle Ford,”Kase says. “In a well-connected reservoir with higher permeability,you can calculate the flow or drainage rate based on the reservoir not a strong correlation between the characteristics of the reservoirparameters. Here, because the rock is so dense and varied, it creates and how much production you can expect from the wells.a significant challenge.” “Shale gas recovery factors generally run in the mid to high teens,The flow rate from a single well, for example, can be deceiving. The and oil recovery factors between five and seven percent,” Kasefluids might be entering the well at a uniform rate throughout the says. “If we can build a dynamic reservoir model for the Eagle Ford,length of the completion zone, or the majority of the fluids might be I believe we can improve recoveries significantly. This will have acoming from a narrow zone that just happens to have more natural significant impact on not only production rates, but the value of thefractures in the rock. Without a good model of the reservoir, there is asset. The really big prize, however—if we can unlock the secrets qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 19 in revenue, created 38,000 full-time jobs, and added $211 million to local government revenues in south-central Texas. Today, communities in the 14 counties that make up the Eagle Ford are building new schools and hospitals and launching training programs to help people realize the benefits of shale oil and gas development in the regions surrounding their communities. The study projects that up to 116,000 full-time jobs will be created by 2021. Water in an arid land The Eagle Ford has no surface water to speak of. Much of the area is quite arid, but there is a world-class aquifer that has an immense volume of fresh water in a porous sandstone that is 400 to 500 feet thick. The problem is, the water is extraordinarily deep. While most freshwater aquifers are no more than 400 feet below the surface, one has to drill much deeper down to reach this one. Cities can afford to get their water from this source, but many ranchers and farmers can’t.BHP Billiton Petroleum Chief Executive J. Michael Yeager (left) on avisit to the Eagle Ford.of the Eagle Ford—will be the ability to apply that technologyelsewhere around the world.”Adjusting to the marketLow natural gas prices in the United States have caused dramaticshifts in the way producing companies manage their fields. Suchcycles, driven by supply and demand, have been the nature of thepetroleum industry since 1859.In BHP Billiton Petroleum’s case, it has shifted assets to producemore hydrocarbon liquids and less dry gas. Since the Eagle Ford andPermian are its most liquids-rich fields, they are getting the mostattention. Near the end of 2012, the company was running 8 rigs inthe Permian Basin and 30 in the Eagle Ford.A new fleet of drilling rigs, most of them purpose-built for workingin shale, are now being delivered from fabrication yards on the TexasGulf Coast. Several units are already in service and the rest will be inthe field by mid-2013. By then, all 45 BHP Billiton Petroleum drillingrigs will be the safest, cleanest, and most energy-efficient in the field.A boost for local communitiesExploration, development, and production in the Eagle Ford Shalehas contributed to the economic revitalization of the region. To get enough water for drilling and hydraulic fracturing, we haveAccording to a 2012 study by the University of Texas at San Antonio, drilled a number of fresh water wells and turned them over tothe shale gas projects in 2011 alone generated just under $20 billion private landowners. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®20 BHP BillitonTo get the water needed for drilling and fracing wells in the are typically used for drilling only one or two wells on a pad. ThatHawkville area of the Eagle Ford, BHP Billiton Petroleum is drilling equipment is easier to move from one site to another. The skidderthese extra-deep water wells and turning them over to private rigs are designed to drill multiple wells on a pad. They are morelandowners in exchange for a share of the water. That gives it complex because they include a skidding system that allows thethe water it needs, and the property owners are happy to have a derrick to move quickly from one well to the next.”reliable source of fresh water. How much is needed? The amountof water needed per well for hydraulic fracturing varies from one If the idea is to drill appraisal wells, as is done in the Permian, thenfield to the next, but three to five million gallons is a ballpark figure. the rigs need to be easy to move. If the rigs will be drilling largeWhile that sounds like a lot, it is small compared to the daily water numbers of development wells, as they are in the Eagle Ford, thenconsumption of a power plant or the irrigation needs of a large rigs on skids are the answer.farm. To ensure that it is not taking too much water or harmingthe aquifer in any way, the company has retained the services of a “All 45 of our new rigs have much better control systems than thePh.D. geologist who lives in the area. As a landowner himself, he units they are replacing,” Cardno adds. “That makes them morerepresents the community and advises local water boards. suited to drilling the type of short-radius horizontal wells we want. These rigs can drill the curve and lateral sections of the wellboreThe drilling program much more efficiently and with a high degree of precision.”When BHP Billiton Petroleum took over drilling in the Eagle Ford, it The new equipment is also more automated than ever before.put a lot more hardware in the field, including 30 new rigs built to Drillers, for example, can enter set points, then take their hands offits specifications. the controls and let the rig’s computers guide the drill string.“Our rig fleet is entirely composed of modern AC rigs split between “These advanced rigs are inherently safer than the older ones,”fast movers and skidders,” says Derek Cardno, the company’s vice Cardno says. “A lot of the hazards have been designed out.”president for global drilling and completions. “The fast moversA finished well site in the Eagle Ford field. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 21“We’re trying to change the way folks think about safety in their day-to-day business. That’s going to take constant vigilance.” Vice President of Drilling Derek Cardno.Safely managing change numbers of rigs. An engineer and superintendent work together, and each has a certain number of rigs supported by a small team.With 45 drilling rigs in BHP Billiton Petroleum’s U.S. onshore fleet,part of the challenge is managing them consistently. “The hard part is getting a consistent message across all work fronts,” Cardno says. “We’re managing that through a lot of“We are a bigger organization now,” Cardno explains. “Smaller interaction. I receive direct reports daily. We have a morningcompanies are used to working with fewer rigs. We work that way meeting every day to go through the operations and discuss issues.ourselves in the conventional business, where we had only eight or Managers do the same down the line.”ten work fronts at any one time around the world. They were runby a small team. Everyone knew how each other worked. Now, in The drilling organization also brings all of the field personnel togetherthe unconventional plays, we are geared up to run 45 rigs and nine every three to six months. The goal is to get the same message outfrac spreads, so we have 60-70 work fronts. That is a lot to get your to everyone about the company’s expectations and its requirementsarms around.” for safety, performance, and quality. It is also an opportunity to gain valuable feedback from the field.Consistency is one of the most difficult things to achieve in dailyoperations. When you consider that the drilling program spans “We are doing it with our service providers as well,” Cardnonot only the Eagle Ford, but three other large fields as well, the says. “We’ve met with vice presidents and CEOs of all our servicechallenge is huge. companies. We brought them all together to make sure everyone understands what we expect in terms of safety, quality, andWhat Cardno and his team did is divide the drilling organization performance. We’re making great strides, but we cannot getinto smaller, more manageable chunks: Drilling managers look over complacent. We’re trying to change the way folks think about safety ina certain number of rigs. Drilling superintendents oversee smaller their day-to-day business. That’s not going to happen overnight.” qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®22 BHP BillitonThe Permian BasinThe Eagle Ford is liquids-rich, but the PermianBasin, which covers some 75,000 square miles ofwest Texas and southeastern New Mexico,has a very high percentage of crude oil.Although BHP Billiton Petroleum is still drilling sine waves slowly through the earth, pushing up mountains in someappraisal wells, it is seeing liquid hydrocarbon places and leaving basins in between.production from shale in the range of 75 percent. The Permian is huge, and anything but consistent. There are multiple layers of hydrocarbon-bearing rock with names like Wolfcamp,The best wells are in the 30,000 square-mile Midland Basin and in Sprayberry, and a blend of the two known as the Wolfberry. Thethe smaller Delaware Basin, which lies to the west. Many operators Permian includes the north and south Midland basins, a Centralare working in various parts of the Permian, which accounts for Basin Platform and the Delaware Basin. BHP Billiton Petroleum’sabout 20 percent of all the drilling in the United States today.BHP Billiton Petroleum has more than 440,000 acres of undevelopedland under lease. What is it finding? One of its appraisal wellspeaked out at 500 barrels of oil and six million cubic feet of gasper day. It’s too early to tell how many such wells it will have, butits Permian drilling program calls for 60 new wells in 2013, andthe company is just getting started. An area known as the SouthMidland is largely unexplored, but many companies are starting todrill there now. It is a very new play for the industry in general, andthere is a lot of optimism because liquids production in some areascould be as high as 90 percent.Portions of the Permian Basin have been producing conventionaloil and gas since the 1920s. In 2012, the conventional part of thePermian produced the energy equivalent of a million barrels ofoil per day. Now, with the ability to recover hydrocarbons fromunconventional plays, production from the Permian could reach twomillion barrels per day by 2020.Challenging geology of the PermianThe basin itself was formed as part of the Ouachita orogeny,a 50-million-year era of mountain building caused when thecontinents we now call North and South America bumped togethersome 300 million years ago. The continental collision sent huge Lee Higgins is BHP Billiton Petroleum’s top geoscientist evaluating the Permian Basin. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® Safer and more efficient rigs Forty-one of the rigs in BHP Billiton Petroleum’s 45-rig fleet are new and purpose-built for drilling in shale. The remaining four rigs are only three years old, which means that the company operates the most energy efficient, technically- advanced, and safest rigs in the field. qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® 24 BHP Billiton largest holdings are in the Midland, where the producing zone averages around 700 feet thick, and the Delaware, where the Wolfcamp interval is nearly 1,000 feet thick. By comparison, that is three to ten times thicker than most shale plays. “I’ve been working and studying this area since 1988,” says Lee Higgins, the company’s top geoscientist working on the Permian. “When I saw how much acreage the company had, I was eager to work on the project. The Permian is a huge challenge, both from an operations standpoint and from a technical, scientific standpoint.” For one thing, the “shale” is not really shale. “What we have in the Wolfcamp is really a different type of rock,” Higgins says. “You won’t find this in the Haynesville, Fayetteville, or Eagle Ford. It is different from the Bakken, the Marcellus, and the Utica. Those are all more classic shale plays. What we have in the Wolfcamp is actually mud rock, which implies that it was deposited differently than shale.” Despite the region’s long history of conventional production, there was little data on the layers known as the Lower Permian. Operations Engineer Phillip Schneider. “The Permian is an old basin,” Higgins explains. “The rock changes vertically and laterally. It is not the same here as it is over there, so even nearby wells could have different characteristics. Every time we horizontal sections. Operators are trying both, and there are good get new data, we go back and rethink what we thought before.” arguments for each approach. Vertical wells are cheaper to drill, but horizontals reach more of the reservoir. One question is whether it is better to drill vertical wells through the 1,000-foot thick producing zone, or to drill them with long “We’re exploring the concept of drilling stacked laterals,” Higgins adds. “That means a series of two or more horizontal wellbores, one above the other. The trick is where to put those laterals. It’s important to remember that we have only drilled a handful of wells and we are still studying the results. We are just in the early stages here.” Striking a balance The abundance of high-value liquids, particularly in the South Midland and Delaware basins, gives operators more flexibility in developing the field. Even so, it is important to control costs. “We’re drilling fairly long laterals,” says Permian Production Unit Manager Doug Handyside. “The idea is to touch as much rock as possible. Horizontal wells in the Delaware are 4,000 to 5,000 feet long. In the South Midland, we’re drilling 7,500-foot laterals, and some in the industry have drilled laterals up to 10,000 feet.” It’s likely that fields in the Permian will be developed using a mix of horizontal and vertical wells as companies decide which are thePermian Drilling and Completions Manager Paul Kelly (left) with Drilling most economical for their portions of the play.Supervisor Daren Mahoney. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 25“Our initial assessment of development potential here suggests that gas would be dehydrated and compressed and either processedwe will recover only about five percent of potential hydrocarbon or simply sold into a third-party line. We are also building a smallin place. The upside is enormous if we can double that to only cryogenic plant to process our own gas in the Delaware Basin.”10 percent. I believe that in five to ten years, we’ll be there.” Another challenge, besides separating the production intoGrowing pains marketable products, is how to get them out of the field.There is limited infrastructure capacity in the Delaware and South “The pipelines coming out of west Texas are full of oil,” HandysideMidland fields to accommodate the rapid pace of drilling, but explains. “The pipelines that handle the NGL mix are almost full.operators are catching up. Typically, collections of nearby wells will There is enough pipeline capacity to handle the dry gas, but gettingflow to pads or tank batteries to begin separating the oil from the liquids out has been an issue.”natural gas liquids and dry gas. The oil and condensate is typicallystored at the lease site and trucked out. Pipeline companies are beginning to move in, expanding their capacity and building new lines. The lag in infrastructure is mainly“For the gas, we propose to build infield gathering systems and due to the rapid increase in liquids production as the unconventionalroute it to a central distribution point,” Handyside says. “There, the reservoirs in the Permian are developed.Operations Supervisor Brian Downing (left) and Production Supervisor Dennis Winowiecki at the site of a new gas plant under construction. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®26 BHP BillitonThe Haynesville ShaleIn 2007, the Haynesville Field in northwesternLouisiana did not exist. Today it is among thelargest gas fields in the United States.Technically known as the Haynesville/Bossier The Haynesville shale currently produces enough natural gas toShale, this play is remarkable for several reasons. satisfy 10 percent of U.S. demand. BHP Billiton Petroleum is one of the largest leaseholders in this field, as it is in the Fayetteville play toLike other shale developments in the BHP Billiton the north in Arkansas.Petroleum portfolio, this one is big. The entireplay straddles east Texas and western Louisiana. Even if U.S. gas prices trend low through 2013, the HaynesvilleMost of the company’s portion of the field is in shale still contains enough easy-to-recover hydrocarbons to make itLouisiana, where the producing zone is up to 300 profitable. The wells are fairly deep, but the shale is easy to frac.feet thick and the reservoir pressure is relatively The company’s strategy for the Haynesville—given the prolific Permian Basin and Eagle Ford plays in its portfolio—is to continuehigh. The rock is also hydrocarbon-rich, and the drilling at a moderate pace. It has enough rigs to keep its drillingwater saturation is low. teams busy and support its contractors. When dry gas prices in the United States firm up, the company can pick up the pace. “There are places in the Haynesville where neighbors can see our operations from their back porch.”BHP Billiton Petroleum’s new office building in Shreveport,Louisiana, will double as a training center for new employees. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 27Here to stayDrilling continues in the Haynesville even inthe face of lower natural gas prices. Part of thecompany’s strategy is to maintain a solid base ofcontractors and experienced crews so they willbe available when the market rebounds. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®28 BHP Billiton The neighbors Unlike the Permian and Eagle Ford fields, there are places in the Haynesville where neighbors can see BHP Billiton Petroleum operations from their back porch. “A two-well site near Shreveport is about 1,000 feet from the home of a retired federal judge and a church, and the Red River is just across the highway,” says Haynesville Production Unit Manager Greg McCain. “Another site is about the same distance from a school.” Even though BHP Billiton Petroleum is new in town, its employees are not. External Affairs Manager Tommy Clark has lived in Shreveport more than 25 years. He has a business background and has worked extensively with local and state governmental agencies. “When working so close to the community,” Clark says, “we go out of our way not to be a nuisance. We are sensitive about noise, for example, so fracing operations are typically restricted to daylightExternal Affairs Manager Tommy Clark (left) and Haynesville hours. In the case of the nearby school, we waited until ChristmasProduction Unit Manager Greg McCain. break to complete the well.”In the Haynesville area there is plenty of surface water available. Much of it comes from the Red River. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 29To conserve water and avoid the high cost of disposal, much of the produced water from BHP Billiton Petroleum wells is stored on site in tanksand reused for hydraulic fracturing.Responsible water use communities. Where we are close to the river, we pull water from there. We also drill water wells into the Red River alluvial, which isIn most areas where operators use hydraulic fracturing, finding where the State of Louisiana wants us to drill.”enough water is a problem. Not so in the Haynesville, wherethere’s plenty of surface water available. Much of it comes directly What about the water that is not recycled? In the Haynesville, therefrom the Red River or ponds that have been built to hold frac aren’t many disposal wells, so that also drives the effort to recycle.water. The bigger challenge is what to do with water that comes Although we’ve been in the Haynesville a relatively short time, theback to the surface after a frac job, and what comes up from the equipment and practices we have in place so far allow us to reuseproducing wells. more than 40 percent of all the water from hydraulic fracturing, and the company is constantly improving on that.“We recycle and reuse as much water as we possibly can,” McCainsays. “We don’t pull water from freshwater aquifers that supply rural qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®30 BHP BillitonThe Fayetteville ShaleThe Fayetteville is a giant field that covers a largeamount of central Arkansas. Its wells are shallow,predictable, and remarkably productive.BHP Billiton Petroleum purchased the asset in Responsible water useApril, 2011. Since then, the company has hired There are more than 3,000 wells in the Fayetteville area. BHP Billitonmore than 250 workers. While the level of activity Petroleum operates about 800 of them. Together, those 800 wellshas been scaled back due to lower than expected produce around 10,000 barrels of water per day, and something hasnatural gas prices, Fayetteville continues to be a to be done with it.major part of its onshore oil and gas portfolio. “The previous company primarily trucked the produced water to“The previous operator was very good at identifying the plays, disposal wells,” Skaufel says. “All of the injection wells were in thegetting the land, and appraising it,” says former Fayetteville heart of the field. Right about the time we took ownership, however,Production Unit Manager Rob Skaufel, and now BHP Billiton a series of small earthquakes swept this part of Arkansas. A similarPetroleum’s President of global Conventional Production. “Now thing happened 50 years ago. We thought the recent quakes werewe are at the point of developing the acreage.” a repeat of the older ones, but we wanted to make sure they were not related to our water injection wells. We did a study, and evenIt was exactly the time to step in. As a large international oil though we did not find evidence that our wells caused the problem,company, BHP Billiton Petroleum brings resources, financial strength, we could not prove they didn’t, so we voluntarily shut them down.”and a depth of experience that smaller companies seldom have.Take safety, for example. The water disposal costs shot up, from $2 a barrel to as much as $15. Waste water had to be trucked to disposal wells as far away as“Our way of doing things is based on our experience offshore,” eastern Oklahoma.Skaufel says. “Safety is the highest priority in the company. We bringestablished systems and processes developed offshore and adaptthem for onshore operations.”The same culture of safety and operational integrity shows in the “Our way of doingway the fields are being developed, Skaufel notes. things is based on our“We do assessments and baseline studies that cover a 1,500-foot radius around each well. If there are existing water wells or experience offshore.sources of surface water, we sample them to be sure we know whatcondition they are in before we drill, then we sample them again Safety is everything.”later to see if there is any change.” qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 31 Efficient design Skid-mounted drilling rigs such as this one are much more efficient for drilling multiple wells on a single pad. qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®32 BHP BillitonThe final stage of building a well is to run all of the fluids through a test separator like this one to determine the exact amount of water, oil, andnatural gas the well is producing. (Photo courtesy Cameron)“We were still doing that when I joined the company in August, Drilling efficiency2011,” says Operations Specialist Corey Riddle. “Disposal is still themost direct way to handle produced water, but we think it’s better In 2011, it was taking a month to drill the average Fayetteville well.to recycle as much of it as we can.” Through a process of continuous improvement, crews are now doing the same in less than half the time.That’s easier said than done in a field where the wells are widelyspaced and set among rolling hills. Riddle’s answer was to group “On the south end of the field, it is not unusual to take 20 days towells to one of four water-collection hubs. That did two things: It drill a well, but in other places we have come down to 10 days,”made the collection system more efficient, and it took a lot of big says Fayetteville Drilling Superintendent Bill Robinson. “There aretrucks off the road. many things we have been doing to improve the efficiency and safety of our rigs.”“If one truck holds 100 barrels (4,200 gallons) of water, and weneeded to dispose of 10,000 barrels of produced water a day, that Most of the drilling has shifted to the liquids-rich Eagle Ford area,means 100 trucks were picking up the water and driving four to and an increasing number of rigs will go to the Permian. Even so,eight hours to the disposal site,” Riddle says. “That was not only Fayetteville has the potential to be a major producer of natural gaswasteful, it was a safety risk. Now the system is more localized, and for the next 50 years. The current development plan is to continuemuch of our produced water is being treated and recycled for fracing drilling through the middle of 2020.nearby wells. Our highway truck traffic is down substantially.” “Even with low gas prices, we are still drilling economic wells,”While truck traffic is down, the amount of water being recycled Robinson says, “but for now, we have dropped our rig count inis way up. Fayetteville from a high of 13 down to two. We don’t want to lose the momentum and capability we have gained over the last year,“When we first started to focus on water use, we were recycling both internally and with our contractor base. If the U.S. demand forabout 10 percent,” Skaufel says. “By April, 2012, it climbed as high natural gas comes back as quickly as it fell, we want to be able toas 85 percent, and there have been weeks since then that we were meet the need.”recycling 95 percent of our water.” qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 33“Much of our produced water is being treated and recycled for fracing nearby wells.” Operations Specialist Corey Riddle. BHP Billiton Petroleum’s newest wells in the Fayetteville use composite trees that are more compact than conventional frac trees. They are also safer, since operators can reach all of the controls from a comfortable height, rather than having to use a lift. (Photo courtesy Cameron) qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® 34 BHP Billiton Zero Harm BHP Billiton Petroleum operates under the principle of Zero Harm to people and the environment. In many locations, the company’s policies set the standard for smaller operators. As a globally significant producer, exporter, its history, and it places BHP Billiton Petroleum firmly in the top 10 and consumer of energy, BHP Billiton Petroleum percent of the industry. is committed to managing its greenhouse-gas “My group supports them,” says HSEC Vice President Kristen Ray. emissions. The company actively seeks to reduce “In our North American Shale operations, our first remit is getting water usage and carbon emissions across its the basics right. Much of our work involves regulatory compliance business, and publishes the results in its annual Sustainability Report. BHP Billiton Petroleum is one of the safest oil and gas companies in the industry. It works at it. Its programs aim to identify all risks so they can be understood and controlled. That means the company investigates every incident to determine the root cause and prevent it from happening again. Since 2006, BHP Billiton Petroleum has experienced continuous improvement in its Health, Safety, Environmental and Community (HSEC) programs. In fiscal 2012, the total recordable injury rate within its conventional business was 1.34, which is the best-ever in“We look at risks and what we can do to prevent injuries. That always comes first.” HSEC Vice President Kristen Ray. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 35Operations Engineer Tommy Roberts (left) and Drilling Superintendent Orville Crandall.and our license to operate. We look at risks and what we can do toprevent injuries. That always comes first.”The company’s rapid growth in 2011 and 2012 meant hiring a lotof people, not only on the drilling and operations side, but alsothe HSEC professionals needed to support them. Up and down theline, all of those new employees needed to learn how BHP BillitonPetroleum works.“We have to communicate and train and make people aware of whatthe company expects, especially in terms of safety,” Ray says. “We arestill in the early stages of that journey. We are establishing baselinesfor compliance and learning where our opportunities for improvementare. From there, we can build on improvement and driving culturalchange. But it is a journey that will take several years.”The lessons the company has learned in the conventional oil andgas business are now being applied to each of its four giant fieldsin the Onshore United States. The company’s goal is to become thesafest company in the industry. It is proud of its achievements sofar, and is confident that it will continue to make progress towardsits goal of Zero Harm. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®36 BHP BillitonGood NeighborsBHP Billiton Petroleum employees live wherethey work, and they try their best to contributeto the lives of those around them.It’s more than just getting along. Whenever BHPBilliton Petroleum joins a new community, itstudies the quality of life as well as the social andeconomic environment to find areas to target forcommunity development.Each community is differentWorking in various locations would be easier if all situations werethe same, but they’re not. In south Texas, for example, there are fewlarge cities but many smaller communities.One in particular is the town of Cuero in DeWitt County, whichlies within the very active Eagle Ford basin. BHP Billiton Petroleum BHP Billiton Petroleum has donated $30,000 per year throughhas more than a dozen rigs working nearby, and there are other the Thea Foundation to support rural school art programs in the Fayetteville area. operators in the area. The company knows that puts a strain on the local infrastructure. To help compensate, it voluntarily pays the county of DeWitt a per-well fee to help offset the cost of maintaining the roads. In a broader context, company employees also meet regularly with local officials to address their concerns. It realizes that it affects these communities, and it wants to do everything it can to help out. Economic growth Community relations aside, the most widespread benefits for every part of the country where U.S. onshore oil and gas development is booming are the good-paying jobs, business income, and tax revenue that development brings. The Fayetteville play in Arkansas is a prime example, according to a 2012 report from the University of ArkansasKids everywhere love to paint. Center for Business and Economic Research. The study highlights the qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 37many direct ways the state benefits, and hints at the indirect gains for of Arkansas study adds that even with the slowdown in the U.S.restaurants, hotels, retail stores, and other local businesses. economy in general, five out of the nine Fayetteville Shale counties saw higher than expected growthThe average pay of oil and gas workers, for example, is twice theaverage for all other industries in the state. New businesses in According to the Texas Railroad Commission, the Eagle Fordcentral Arkansas have also increased at a higher rate than the state produced 308,139 barrels of oil in 2009. That jumped to 4.3 millionin general for the past ten years. barrels in 2010 and then to an astounding 36.6 million in 2011. In 2009, 19 billion cubic feet (Bcf) of dry gas and 839,490 barrelsManufacturing jobs are coming back. There’s a new $100 million of natural gas liquids (NGL) were produced. Those figures jumpedplant in Saline County that makes ceramic proppant for use in to 287 Bcf of dry gas and 7.0 million barrels of NGL in 2011. Thehydraulic fracturing. Two manufacturing plants in Arkansas and Commission predicts that the Eagle Ford will continue to shattera sister plant in Missouri hired a total of 1,000 people to build even these output figures in the years to come.railroad cars to haul sand to the oil and gas fields. The UniversityA BHP Billiton Petroleum employee watches activities at the Main Street Searcy Festival in Searcy, Arkansas. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®38 BHP BillitonAvoiding potentialroadblocksIn rural areas, the economic benefits of oil and gasdevelopment come with their own set of challenges. Rural roads were never meant for heavy use, but drilling and fracturing a single well requires hundreds of trips to and from the well site in trucks weighing up to 40 tons each. Just moving drilling rigs over county roads can amount to the wear and tear of years of normal traffic. Companies like BHP Billiton Petroleum recognize that, and have stepped forward to help address the problem by offering to compensate counties to offset the extra traffic their operations bring. For example, until a permanent and equitable solution can be found, BHP Billiton Petroleum has been voluntarily paying DeWitt County a per-well fee as a way to offset the cost of maintaining the roads. Everyone knows, however, that the current arrangement is only an interim solution. “Good roads are good for business,” Fowler says, “but at the county level, we just don’t have the revenue to maintain them without someDeWitt County Judge Daryl L. Fowler is the highest elected public help from the state.”official in his county. Part of the problem is the way tax money is allocated. While the State of Texas receives all of the royalties for oil and gas productionWhere will all the new workers live? Are there enough restaurants on land where it owns the mineral rights, the money is notand stores in small towns to support the rapid increase in earmarked for roads.population? Are there adequate medical facilities and schools? Inmost cases, local governments, enterprising individuals, and private “For the first six months of 2012, oil and gas companies operatingcompanies are rushing to fill the gap. in DeWitt County paid $71 million in severance taxes to the State of Texas,” Fowler says. “DeWitt County didn’t get a nickel of it.”“But what about the roads?” asks DeWitt County Judge Daryl Fowler. But the judge is hard at work with the state legislature to find aHis jurisdiction, a rural area in south-central Texas, sits atop the permanent solution. It is a classic case of industry and government –richest part of the Eagle Ford Shale. DeWitt County maintains 689 at the both the local and state level – working cooperatively to themiles of road, and 342 of them are simple gravel or asphalt lanes. benefit of all concerned.DeWitt County’s growing pains are typical. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 39 nBig trucks for big jobsThe high volume of truck traffic onrural roads is a problem the industryand host communities are dealingwith in almost every region whereshale oil and gas is being developed. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® Company Profiles 42 Cameron 46 Baker Hughes 48 Celerant 50 FTS International 52 GE Oil & Gas 54 Halliburton 56 Jacobs 58 Nabors 60 Jet Maintenance 61 Schlumberger Custom Publishing VP, PennWell Custom Publishing PennWell Petroleum Group Roy Markum 1455 West Loop South, Suite 400 roym@pennwell.com Houston, TX 77027 U.S.A. 713.621.9720 Managing Editor and fax: 713.963.6285 Principal Writer Richard Cunningham PennWell Corporate richard@rcunninghamstudio.com Headquarters 1421 S. Sheridan Rd., Art Director Tulsa, OK 74112 Meg Fuschetti P.C. Lauinger, 1900–1988 Production Manager Chairman, Frank T. Lauinger Shirley Gamboa President/CEO, Robert F. Biolchini qM qMPrevious Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®42 BHP Billiton COMPANY PROFILE CAMERONBHP Billiton Petroleum Taps Frac Equipmentand Services Leader Cameron for Shale,Deep Permian Basin DevelopmentProviding enhanced uptimethrough high-integritycritical frac equipmentmonitored by FracServ™,Cameron’s Valve IntegrityProtection Plan (VIPP)BHP Billiton Petroleum is acceleratingdevelopment of both dry gas and liquids-rich shale gas formations such as thosefound beneath its extensive leaseholdings in the Fayetteville and Eagle Fordshales, among other domestic tight gasregions. The company also is ramping uphorizontal drilling and completion of moreconventional deep, oily gas formationslocated in the greater Permian Basin. Cameron recently entered into a five-year fixed contract to provide BHP Billiton Petroleum with flowback services in the Fayetteville Shale Play.Working hand-in-hand with BHP BillitonPetroleum in developing shale gas andliquids production and other tight gas systems critical to BHP Billiton Petroleum’ssands is Cameron, whose Surface Systems fracturing and well completion operations indivision provides integrated well surface the shale areas, Cameron recently enteredequipment and services for high-pressure, into a five-year fi xed contract to provide ithigh-fluid volume fracturing, flowback with flowback services in the Fayettevilleoperations and well testing. Shale play.Cameron is among top manufacturers and One main reason for partnering withsuppliers of high-quality, reliable pressure Cameron is its ability to provide high-control and flowback equipment to ensure integrity equipment and systems, a crucialenhanced results from ever larger high- aspect for an operator in mitigating HSSEpressure frac operations with higher fluid issues as well as risks associated withvolumes that cost tens of millions of dollars. horizontal drilling and hydraulic fracturing.The two companies have maintained As a responsible operator, BHP Billitonan extensive global relationship with Petroleum is conscientious of protectingregard to subsea oil and gas operations its personnel and contractors on locationin the offshore environment, as well as as well as the communities in which itin conventional land-based development. drills. The selected supplier must be ableThey have carried that association further to provide high-quality equipment andas a result of BHP Billiton Petroleum’s services of such integrity that it alleviatesacquisitions of its large lease holdings in Cameron supports its flexible failures. Risk mitigation starts with reliable,shales. In fact, in addition to providing solutions with highly trained, high-quality equipment, but is sustainedits full range of flow control products and competent service technicians. by proper monitoring and maintenance, as qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 43provided by FracServ™, Cameron’s Valve handle the challenges that are unique to caused by a gate valve failure is idle timeIntegrity Protection Plan. this fast-growing element of our industry. for an expensive frac crew.A top choice gate valve Frac service is about as harsh as it A key component of Cameron’s products,for Frac Operations gets. Gate valves are exposed to nearly including frac manifolds and frac trees, isAs a leading provider of critical and high- continuous service, flowing and controlling its internationally recognized FLS-R™ gatepressure control equipment, Cameron is high-pressure, high-volume, abrasive valve, which provides operators with high-committed to providing effective, safe, frac fluid for days, and even weeks, on quality metal-to-metal sealing to deliverreliable, and cost-effective products to end. And the cost of failure is high. Delay design dependability and durability within harsh and erosive operating environments. The FLS-R gate valve has established a worldwide reputation as a top choice valve for fracturing operations in both conventional and unconventional resources areas. It is designed, developed, and qualified by Cameron’s engineers. As all Cameron’s large-bore and high-pressure gate valves, the FLS-R is manufactured in-house at the company’s state-of-the-art manufacturing facilities. It has a reputation for excellent performance earned in tackling a long list of extreme applications. For fast, positive remote operation, Cameron provides the FLS-DA2 gate valve. It has a simple design with all the metal sealing features of the FLS-R, but with a double-acting hydraulic actuator. FracServ – Monitoring fatigue life of critical frac equipmentCameron offers composite frac tree systems. By incorporating the master and swab valves, Typically, surface frac equipment isand wing outlets into a solid body, the number of potential leak path connections as well subjected to a series of forces thatas the tree height and weight are reduced. serve as drawbacks to an efficientA key component of Cameron’s products, including frac manifolds and frac trees, is its Cameron is among top manufacturers andinternationally recognized FLS-R gate valve, which provides operators with high-quality suppliers of high-quality, reliable pressuremetal-to-metal sealing to deliver design dependability and durability within harsh and control and flowback equipment.erosive operating environments. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®44 BHP Billiton Leveraging Technology Accustomed to high-end technology in its offshore development projects, BHP Billiton Petroleum is naturally interested in any technology that offers efficiency, promotes safety, and minimizes downtime for its onshore shale operations. Partnering with an industry leader such as Cameron offers access to technology and new innovations that have the potential to be game changers. Cameron already offers composite frac tree systems as an alternative to conventional frac tree systems. By incorporating the master and swab valves, and wing outlets into a solid body, the number of potential leak path connections as well as the tree height and weight are reduced. Taking the compact conceptThrough the FracServ Valve Integrity Protection Plan, Cameron’s competent field further, Cameron expects to launch itsinspection specialists follow a set of procedures written by the company’s design and next generation frac tree, the F-T90™ inquality engineers to assure the integrity and service performance of its frac fleet. early 2013. This new design is expected to not only offer a smaller footprint and reduced height, but further enhance theand successful operation. These FracServ is that it mitigates safety and integrity of overall frac operations.include high-working pressures, high environmental risks while enhancing anvolumes of abrasive frac proppant per operator’s fracturing uptime. As with all Cameron’s frac trees, thestage, highly corrosive fluid additives, F-T90 can be operated with pneumatic,equipment vibration, oscillation,bending loads due to pump cavitations,shrapnel from perforated casing, andthe debris resulting from drilled-outisolation plugs. These effects resultin flow-bore erosion, wetted surfacecorrosion, high and variable loads inpressure vessels, and similar bendingloads in equipment bolting.The philosophy of knowing the severityof such effects is the crux of theCameron’s FracServ Valve IntegrityProtection Plan, which the companyprovides for its manufactured surfacefrac equipment. Through FracServ,Cameron’s competent field inspectionspecialists follow a set of procedureswritten by the company’s designand quality engineers to assure theintegrity and service performance ofits frac fleet. Although a vigorouscommitment, the company believesthis principle offers better protectionto shale operators than a “flush and Accustomed to high-end technology in its offshore development projects, BHP Billitontest” approach. The latter procedure Petroleum is naturally interested in any technology that offers efficiency, promotesrequires little to no disassembly and, safety, and minimizes downtime for its onshore shale operations. Partnering with anat best, limited verification of trapped industry leader such as Cameron offers access to technology and new innovations thatdebris. The bottom line for Cameron’s have the potential to be game changers. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®The ECO2 System accurately measures production, reduces emissions, and collects natural gas liquids for transfer.hydraulic, or electric actuation. The These innovations, when ready for market, and brings to the table a heritage ofelectric frac tree actuation control system, will allow operators a more secure and industry leadership, a reputation formanufactured by Cameron, minimizes defensive option than current practices technically sound products, qualitypotential damage to vulnerable hydraulic with frac iron. in-house manufacturing, reliable productpower units or to the lengthy, leak-prone performance, and service excellence.hydraulic lines that typically meander From an ecological standpoint, Cameron isaround wellsite equipment. also taking initiative in green innovations Cameron is a leading provider of flow with its ECOnomical and ECOlogical (ECO²) equipment products, services, and systemsThe equipment and technicians required to production system. Using a three-phase to worldwide oil, gas, and process industries.hydraulically fracture a well are expensive. separator (oil, gas, and water), a stabilizer Leveraging its global manufacturing,When drilling a single well, a significant and a natural gas powered generator, engineering, and sales and services network,amount of idle time is imposed on these Cameron is able to environmentally control Cameron works with customers to control,costly resources. A frac manifold can higher gravity oils and natural gas liquids direct, process, measure, and compressprovide for almost continuous utilization without the release of Volatile Organic pressures and flows.of the frac crew and equipment, from Compounds (VOC). Typically, vapors fromthe first treatment at the toe of the a storage tank need to be controlledfirst well to the last treatment at the (that control method includes flaring theheel of the last well. This represents a vapors or utilizing a vapor recovery unitsubstantial improvement to the effective to recompress them to a higher pressure)use of the frac resources and, thus, to the and subsequently moved to a pipeline for Cameronoverall economics of the well. Cameron’s transport. The ECO² production system 4646 W. Sam Houston Pkwy. N.Generation II Frac Fluid Delivery System does not allow the vapors to be generated. Houston, TX 77041(FFDS) is an improvement of the current They are kept under pressure until they getfrac manifold design. It is a solid mono- to a point where they can economically be Tel 1.713.939.2211line solution that utilizes API standards collected and sold. Fax 1.713.939.2753and controlled bolted connections that www.c-a-m.compromote a higher level of system integrity, The rapid growth in the production of shaleand hence, safety. Parallel to this effort, oil and gas in recent years has broughtCameron’s engineers are working on a phenomenal growth as well as uniqueGen III design that may well become a challenges to our industry. Camerongame changer to the industry. is actively resolving these challenges qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®46 BHP Billiton COMPANY PROFILE BAKER HUGHESBaker Hughes has the technologicalsolutions to meet oilfield challengesEvery shale play presents a diverse range For the demanding build and lateralof challenges, and those challenges require sections of the Eagle Ford wells, Bakera service company with equally diverse Hughes’ drilling systems, when matchedexperience. Baker Hughes is a global oilfield with application-specific bits, provideservices company that offers a wide array of an unrivaled level of drilling serviceproducts and services to operators, including performance. “Our latest RSS and high-the expertise of scientists and technicians performance motors let operators drillwho can bring the right mix of knowledge curve and lateral sections using the sameand tools to characterize reservoirs, drill equipment, lowering cost and reducingboreholes, evaluate formations, cement operating time,” said Mathias Schlecht,casings, run completions, and stimulate and Baker Hughes’ Vice President of Technologymonitor production. The company’s ability for Drilling and Evaluation. “Theto leverage enterprise capabilities results AutoTrak™ Curve RSS allows high buildupin better wells, improved productivity, and rates, extended-reach laterals, precisecontinued safety. wellbore placement, and a reduction in time on the well by drilling vertical, curveWith the integration of pressure pumping and lateral sections in one run.”services, Baker Hughes’ commitment to Baker Hughes is a leading supplier ofdelivering safe and effective solutions The Hughes Christensen Talon™ high- oilfield services, products, technology, andthat maximize asset value while meeting efficiency PDC drill bits are designed systems to the worldwide oil and naturalenvironmental responsibility goals is in conjunction with Baker Hughes’ gas industry.stronger than ever. AutoTrak Curve RSS. Working together, these technologies meet the challengesFor decades, Baker Hughes has helped of drilling unconventional plays with shale solutions, including Baker Hughes’operators overcome operational hurdles in exceptional accuracy, reliability, and StarTrak™ imaging tool, which identifiesTexas. In the Eagle Ford Shale, for example, speed. “We’ve seen some really great natural and induced fractures whileone of the most prolific fields in the U.S., performance with our Talon bits,” said drilling, and characterizes the horizontalBaker Hughes has drilled more than 1 Mark Freeman, Baker Hughes’ Director of for optimal zone placement and maximummillion feet, and has been actively involved U.S. Land Sales. “Our StaySharp™ cutters production potential.in 97% of all wells in the Eagle Ford to date. keep the bit efficiently drilling longer soThe company has played a significant role run life is maximized with higher ROP, The LATIDRILL system is one of thein the successes that BHP Billiton Petroleum helping to reduce the days on the well.” company’s latest additions to the(BHP) has experienced in the liquids-rich SmartCare™ family of environmentallyEagle Ford and Permian Basin. Baker Hughes Customizable, environmentally responsible solutions. Baker Hughes is theplans to be there for the long haul, providing responsible drilling fluids first oilfield services company to applythe expertise and high-tech equipment Baker Hughes’ LATIDRILL™ drilling a comprehensive chemical evaluationnecessary to produce these fields. fluid system is an integrated water- process to products beyond those used in based platform customized to address hydraulic fracturing. The expansion offersIntegrated bottomhole assembly multiple drilling objectives with additional responsible, high-performingoptimizes well placement improved performance compared to the chemical products to operators. As newand ultimate recovery conventional water-based mud systems. requirements take shape, the SmartCareThrough a combination of Baker It provides aggressive attributes that family will be continuously updated andHughes’ bits, motors, rotary steerable supersede invert-emulsion systems in expanded so Baker Hughes’ customers cansystems (RSS), and real-time logging terms of speed, wellbore protection, and confidently comply with regulations andtools, the company can engineer an cost reduction. The platform capabilities still deliver on production targets.integrated bottomhole assembly to have further enabled operators to set newoptimize well placement and ultimate performance, HSE, and cost benchmarks in Effective zonal isolationrecovery. Baker Hughes is able to “see” challenging drilling operations. A high-quality cement job is an importantthe reservoir, often in great detail, with aspect of any well. Baker Hughes beganthe use of our advanced visualization The drilling fluid system can be packaged working with BHP’s predecessor in theand modeling tools. with the full range of Baker Hughes’ Eagle Ford in 2008. The initial cement slurry qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 47designs were taken from extensive and that the company’s customers can optimize and enhance operators’ wells andsuccessful work Baker Hughes had performed depend on to fracture against. “In order productivity,” Stephens continued.in the Haynesville area. Before applying Baker to effectively stimulate the Eagle FordHughes’ engineered Set for Life™ slurry laterals, BHP has looked to Baker Hughes’ One solution with the potential todesigns to the Eagle Ford, it was matched to composite plugs since 2010,” said Justin enhance long-term production is Bakerthe Eagle Ford’s unique requirements. Dworaczyk, Baker Hughes’ Marketing Hughes’ Sorb™ family of solid inhibitors. Director for Completions and Wellbore MultiSorb™ technology allows theSlurry properties were systematically fine- Intervention. “Since then, we have run combination of two or more Sorb chemicaltuned to provide effective zonal isolation, 4,575 composite plugs with a nearly products in treatments designed towhich is necessary for complex hydraulic 100% success rate.” address multiple issues simultaneously. Infracturing of lateral sections. The addition the Eagle Ford Shale, the technology hasof unique spacer technologies, such as More technology for been used to treat paraffin, asphalt, andBaker Hughes’ exclusive SealBond™ optimal performance biocides, among other issues.cement spacer systems, allows for cement Baker Hughes’ electrical submersibleand fluid lift without losses to formation pumping (ESP) systems optimize production Technology and trainingwhile providing a water-wet coating – for thousands of wells around the world Baker Hughes’ technology and educationall important factors in achieving a good in a broad range of applications. After centers help accelerate the delivery ofbond. Baker Hughes’ state-of-the-art, installation of a Baker Hughes high- advanced technology to the market.fully automated Falcon™ cementing units volume ESP system into one of BHP’s Among the company’s multiple worldwideprovide quality operations. wells, as an alternative to drilling five technology and education centers and water supply wells, the rate at which water laboratories is the Baker Hughes CenterAdditionally, Baker Hughes’ reliable was produced from the supply well to fill for Technology Innovation (CTI), located incomposite plug systems provide a barrier the tank for the pressure pumping job Houston. CTI develops new solutions for increased 250%. This decreased the time the industry’s toughest completions and between well completions by as much as production challenges. five weeks, allowing BHP to return to its planned drilling pace. Baker Hughes’ global shale teams also are supported by a drill bit manufacturing Wells in the Haynesville shale can have a plant in The Woodlands, Texas, and a high level of hydrogen sulfide, which often Pressure Pumping Technology Center leads to internal corrosion of production in Tomball, Texas. The Tomball campus equipment. Baker Hughes has developed has well-equipped laboratories that do a unique suite of production chemicals everything from mineralogical identification to deliver total production solutions that to determining the compatibility of the are delivered via capillary services. Baker formation with completion, fracturing, and Hughes also offers robust chemical-feed stimulation fluids. and tank-monitoring services. For more information about Baker “We successfully treat Haynesville wells by Hughes’ technologies and solutions, continuously injecting a combination high please contact Anthony Hooper at temperature scale-corrosion inhibitor,” 1 281-357-2647 or review our website at said Don Brookshire, Baker Hughes’ www.bakerhughes.com. Sales Director for U.S. Land Production. “In addition, our comprehensive deliquification chemical services help Baker Hughes production flow again.” 2929 Allen Parkway “We not only address the immediate Houston, Texas 77019 demands of increasing production and Phone: +1 713-439-8600 reducing downtime, but we also review Fax: +1 713-439-8699 the application, cost, and effectiveness of www.bakerhughes.com our scale control program on a continuous Email: pamela.easton@bakerhughes.com basis,” said Douglas Stephens, Baker Hughes’ President of Pressure Pumping.Baker Hughes’ PETROSWEET™ hydrogen “We have the expertise to understandsulfide scavengers sweeten natural gas the reservoir and then bring the rightand produced fluids. mix of technologies and products to qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®48 BHP Billiton COMPANY PROFILE CELERANT CONSULTING, INC.The meter is running on your supply chainLet us say that the land drilling rig rentals mobilize equipment and service contractors with logistics, and doing anything it canand contractors are costing you $75,000 for each job. How will a delay or shortage to stay up with changes in the field. It cana day. How much time are you willing to today affect not only that well location, but seem like a never ending battle.spend waiting for someone to deliver a then the next well location, and possibly$500 flange? What about the frac spread the sequence of well locations where those The fundamental challenge is one ofthat—through some mix-up—showed up same resources will be used down the integrating the two sides: field operationsa day early and is now charging $25,000 road? When you then consider multiple and supply chain.an hour to sit around? Remember when a (sometimes several) rigs, trucks, equipmentload of pipe was delivered to the wrong and contractors working at many locations “You may have the best engineers in thelocation, or maybe it was the wrong pipe across an entire field, it is easy to envision business on your team, and you may tellin the first place? Even worse, wells are how critical the overall supply chain is to a them over and over how much you wantdrilled and completed, but then they sit development project’s success. to manufacture quality wells, both safelythere, awaiting the facilities and pipeline and quickly, but that doesn’t make themneeded to produce them. well manufacturing experts,” says Gary Rig & Equipment Movement Traylor, Senior Vice President for CelerantWhile the cost of such waste is high, what Consulting, Inc. “We see it all the time.hurts field operations most is the delayed Those on the front lines just do not haveproduction revenue caused by the many the manufacturing know-how or themishaps and mistakes incurred along management tools needed to integrate theirthe way. When you consider how those field operations with their supply chain.”seemingly minor incidents compoundone another, you can start to see how an Exploration and production companiesentire field’s development becomes sub- are good at finding oil and gas, butoptimized, driving up capital costs and manufacturers who make anything fromlowering returns on investment. automobiles and aircraft to appliances Delays, lost days, and wrong priorities can and apparel are much more adept atHow does this happen? More importantly, all result in lower net production volumes managing their supply chains. Thesehow can it be prevented? and higher spends. companies understand and apply for many years advanced supply chain concepts as ‘operations demand planning’“The challenge is that most of the technical change has been and ‘integrated resource scheduling’. They know how to optimize multiplelayered on top of management systems that are no longer manufacturing constraints, balancingable to keep up. Celerant’s goal is to increase management’s lead times and capacity limitations withfull control of the interactions between field operations and nthe supply chain.” ctio du Co o sts PrMore often than not, the At first glance, the problem may seem toroot-cause is poor supply chain lie within an E&P’s supply chain function.management systems Deeper investigation often shows it is Demand - Constraint fingWhen you think of all the costly details a two-sided problem. The customers Optimization Model Servthat go into safely building a single Staf (the field) are constantly changing their iceswell, operators expect some degree of requirements, going outside and aroundoverspending and production delays. company policies and procedures, perhapsHowever, in unconventional plays, where repeatedly changing the X-Y location itself,operators are scrambling to “manufacture” and submitting their requests at the last Materialshundreds or even thousands of wells minute to the supply chain organization,quickly over the next few years, the thereby jeopardizing the schedule for Optimization occurs through integratedcompounded losses from this inefficiency on-time and in-full delivery. Meanwhile, resource demand planning andare staggering. Consider, for example, scheduling, supported by constant the supply chain organization is backed-the lead times required to organize and feedback on field execution. up with contract requirements, consumed qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 49 Celerant is a global management consulting firm that provides operational strategy and implementation support around the world. Our oil and gas experience extends across the Middle East, the North Sea, the Gulf of Mexico, the United States, Western Canada and Brazil. Celerant delivers real and sustained operational improvements that benefit our clients financially and culturally. Our approach engages people in a way that ensures commitment and lasting performance. Celerant’s ability to deliver is nothing new. We’veCelerant consultants work been at it for more than 25 years, and over 90% of our clients say they woulddirectly with your peopleto achieve break-through be pleased to work with us again.performance.resource availability and costs, all methods and tools they adapted from over can increase their control over operationsthrough modern day manufacturing tools 25 years of business. and stay at the top of their game.”and techniques. Celerant is not just another E&P Making it relevant“That is where Celerant comes in,” Traylor management consulting firm. It has The last twenty years have broughtsays. “We have seen in our projects worked across the oil and gas value chain, unprecedented and occasionallythat much of what other industries have including exploration and appraisal, unexpected advances in horizontal drillinglearned can be applied to exploration and drilling and completions, facilities and and hydraulic fracturing practices. Withproduction. Our consultants have shown pipelines, as well as field and well them have come more new opportunitiesclients where supply chain inefficiencies operations. Celerant’s solutions drive than most oil and gas professionals haveare costing them big money within value throughout an organization. Its seen in a lifetime.their operations, and then provided the core strength is its deep understandingmanagement methods and tools needed to of the complete oil and gas value chain, The challenge is that most of theavoid such costs and delayed production. regardless of departmental function or technical change has been layered onIt doesn’t matter whether we are talking type of operation. top of management systems that are noabout field development projects or longer able to keep up. Celerant’s goal isongoing field operations, e.g. when well But even more, Celerant brings learnings to put management back in full controlwork overs and routine well repairs can and best practices from a multiple range of of their operations. In the new worldbe completed in less time, failed wells are industries in addition to E&P. Drawing from of unconventional plays, Celerant helpsbrought back to production much faster.” that knowledge base, Celerant consultants companies integrate their field operations can provide the very best management and supply chains, to safely manufactureHow we work systems needed to meet your cost, new wells and return existing wells toFirst, a Celerant team of management scheduling and ROI performance goals. production, each within the shortestsystem experts will study your field amount of time and at the lowestoperations and its historical performance. “While we often work in the field to help possible cost.The team will work with your management deliver significant measurable results,and supervisors, both in the office and we share our expertise up and down thein the field, to gather and analyze data client’s management ladder,” says Celerant Celerant Consulting, Inc.identifying opportunities to improve. Senior Vice President Maarten van Hasselt. “Celerant works with its clients from 1980 Post Oak Blvd, Suite 1500They will talk to your engineers andgeoscientists, as well as your rig the shop floor to the top floor. We work Houston, Texas 77056superintendents, field operators, closely with business unit managers, their +1.713.360.4831contractors and suppliers to capture the management teams and reports so that Website: www.celerantconsulting.comfull story, so they can then show you the they can not only talk the talk, but thencomplete opportunity for improvement. walk the talk for their organization to hearCelerant collaborates with you to fix the and see. Using data and studies from theissues, using the management systems, field, as portrayed through our advanced management tools, we show them how they qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®50 BHP Billiton COMPANY PROFILE FTS INTERNATIONALFTS International Delivers Well CompletionServices Focused on Maximizing ResultsCustom Proppant Helps Spearprop® proppant was custom-created by FTSIBHP Billiton Petroleum to help BHP increase its production in the HaynesvilleIncrease Production in the Shale. Spearprop®Haynesville Shale proppant’s green color helps field engineers easily identify it from other proppants to ensure optimum amounts of eachWhen BHP Billiton Petroleum proppant are added to the system.first began work in theHaynesville Shale, the operator facedissues common with the play, known costs escalated while production rates Haynesville. Plus, FTSI’s proprietaryto be the deepest, hottest, and highest fell short of expectations. proppant sources and resin coatingpressured shale among the major facilities help keep costs in check for theunconventional plays in the United Meeting challenges, custom Spearprop ® proppant.States. One particular challenge was exceeding expectationsplacing proppant in the Haynesville’s FTSI responded to the challenge by A true leader in safety trainingdeep formations during the hydraulic developing a more effective, innovative Engineering advances aren’t the onlyfracturing process. FTS International well completion solution. Working attributes that help FTSI clearly identify(FTSI - formerly Frac Tech), a leading closely with BHP Billiton Petroleum’s its position in the market. The companyprovider of well completion and completions teams, FTSI engaged is also focused on Health, Safety, andstimulation services, partnered with experts from its engineering group, Environmental (HSE) leadership. ForBHP Billiton Petroleum to develop a in-house research and development example, FTSI had zero recordablecustom solution – Spearprop ® proppant, labs, company-owned proppant sources incidents (OSHA TRIR = 0.00) for the lastdesigned and produced by FTSI to meet and resin coating operations. Thesethe needs of BHP Billiton Petroleum in experts worked together to invent athe Haynesville. custom solution to address BHP Billiton Petroleum’s challenges in the HaynesvilleBecause FTSI engineers, manufactures – Spearprop ® proppant.and produces many of the key componentsused in its well completion operations, Featuring increased conductivity andthe company is uniquely equipped to higher permeability, Spearprop ® proppantcustomize its services, products and serves as a “bridge” between 100equipment — focusing on customer mesh and 40/70 proppants. This allowsneeds, including distinctive requirements fracturing of Haynesville wells with afor individual plays and reservoirs. FTSI simpler, less costly slickwater process,creates and delivers innovative solutions while enabling better penetration into thefocused on maximizing production. deep formations and fostering increased natural gas production.Since 2008, FTSI has worked withBHP Billiton Petroleum and Petrohawk Since this innovative solution wasEnergy Corporation (acquired in 2011), developed, BHP Billiton Petroleum hasto enhance well productivity. During used Spearprop ® proppant in a majoritythe initial work in the Haynesville, of its wells in the Haynesville, pumpingformation depth presented a significant approximately eight million pounds perchallenge. These deeper areas required month for a total of 2,629 stages ascostly linear and crosslinked gel systems of September 2012. Screenouts wereto place even a nominal amount of reduced and production improved over a40/70 proppant. These completions leading competitor’s system used in thewere also prone to screenouts requiring play. It all adds up to better profitabilitycoiled tubing intervention. Completion for BHP Billiton Petroleum in the qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 51FTSI’s people are also a driving factor in its success. customized technology, focusing on improving recovery. The facility includesCommitted in every way to help ensure each well equipment that FTSI experts will use in their research related to reservoir andreaches optimum production while maintaining safe rock mechanics, proppant technology,operations, FTSI’s people are a tremendous resource. and fluid behaviors. Personalized service is a core value ofyear and a half on BHP Billiton Petroleum business. The company produces a line FTSI. Dedicated teams, from engineerssites. The foundation of FTSI’s safety of ECO-Green™ hydraulic fracturing who work in-house at customer sites toratings is the company’s commitment additives designed to increase production customer-exclusive field staff, demonstrateto training. Its professional HSE staff while minimizing environmental impact. FTSI’s focus on delivering excellentadministers year-round safety training, and One product in this line is Slickwater customer service.reinforcement programs are designed to Green® customizable powdered blend.deliver a best-in-industry record. In fact, Engineered according to the AmericanFTSI’s New Team Member Training program Chemical Institute’s Principles of Green FTS Internationalis PEC Premier SafeLandUSA accredited, a Chemistry, the blend is pre-mixed based 777 Main Street, Suite 3000distinction only one other company in the on job specifications and delivered inoil and gas industry can claim. dry form. This eliminates the need for Fort Worth, TX 76102 product totes, decreasing the operational Phone: 866.877.1008FTSI Service Supervisor Dennis Dunn footprint and transportation costs. An www.ftsi.comand Field Safety Trainer Patrick Hicks additional benefit of Slickwater Green ® sales@ftsi.comdemonstrated exceptional dedication to blend is that it eliminates concerns aboutexcellence, helping to deliver a perfect the product freezing during transport orsafety record for BHP Billiton Petroleum in storage in harsh climates.the Haynesville. FTSI’s new state-of-the-art CorporateRespecting the environment while Technology Center in Houston will fosterdeveloping new technology the development of even more cuttingFTSI continues to explore more edge solutions, including next generationenvironmentally friendly ways to do fluids, market-leading research and qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®52 BHP Billiton COMPANY PROFILE GE OIL & GASInnovative wellhead and frac solutionsstrive to improve safety, keep productioncosts in checkThe development of unconventional gas • Cross-training field service personneland oil has spurred attempts to apply basic and others on the new, expandedoffshore platform techniques — such as product offerings and their application;the assembly line — to drilling and fracing • Restructuring our supply chain tooperations on land. Pad drilling is a prime accommodate a 50% increase inexample. Drilling several wells from one production while maintaining oursmall well site reduces costs of multiple site reputation for quick responsiveness andpreparation and down time due to breaking dedicated customer service;down, transporting, and reassembling the • Remapping our network of servicerig at each location. But in order to make the centers, consolidating those wheremost of such cost savings, many operators are VetcoGray and Pressure Control bothconsidering unconventional wellhead designs had a presence, replacing older facilitieswhich not only require less installation with new fit-for-purpose spaces, andtime, but are designed to improve safety for following our customers’ migration into Pad well sites allow adjacent wells to bepersonnel and the environment. GE Oil & fractured in quick succession, thus saving new oil and gas regions to maintain theGas has spent a substantial amount of time transportation and site preparation costs. ability to respond quickly to their needs;collaborating with operators as they redefinetheir drilling procedures and look at ways to • And continuing to provide the customeroperate more safely and efficiently. service that our culture values, while converting infrastructure on every levelOur History and Culture over to GE systems.GE Oil & Gas is making significantinvestments in new technology, facilities, It has been a huge undertaking that is notpeople, and services to support our oil yet complete. At GE Oil & Gas, we continueand gas customers in key unconventional to learn from our remarkable successesplays across North America and beyond. and challenges encountered along theOne such investment was our acquisition way. Businesses are ever-changing andof Pressure Control, a surface wellhead must continue to adapt in order to grow.manufacturer and frac service provider, Our successful growth is a testament tofrom Wood Group in April 2011. innovative thinking and willingness to learn from those challenges, and will ultimately beGE’s earlier acquisition of VetcoGray in of benefit to our customers.2007 had introduced surface and subseawellhead equipment to our oil and gas Wellhead Solutionsportfolio. Rather than folding Pressure Time-saving wellheads, which also provideControl into the existing VetcoGray surface safety advantages, were first introducedwellhead business, GE did the opposite, so approximately 35 years ago. Sinceas to exploit Pressure Control’s successful then, “unconventional” wellheads havebusiness model. The challenges of the past continued to evolve to reflect the industry’syear have been tremendous: continually changing drilling methods, and offer efficiencies that cannot be achieved• Doubling our head count by merging two using more traditional wellhead systems. similarly sized businesses and learning to manage and leverage their combined Whether it is a Speedhead™ system, one of During the quiet time after the drilling crew the many MB™ multibowls, an S95 Time- leaves and before the hydraulic fracturing trucks strengths; Saver™ or any other system which suits arrive, a BHP Billiton Petroleum wellhead is fitted with a rental frac tree. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 53 a specific application, these GE Oil & Gas maintain, remove, and refurbish equipment. products are backed by a history of over 90 Our crane trucks deliver fully assembled years of surface wellhead engineering and frac trees and install them on the wellhead service expertise. We understand the fast- after the drilling rig is moved from the paced rhythm of the business and the demands site but before the heavy frac tanks and put on our customers not only to produce, but other equipment are moved in. This often to produce economically and safely. significantly reduces set-up time in the field, while providing superior safety on-site. Hydraulic Fracturing Solutions GE Oil & Gas has a long heritage of designing Test trailers are also available for the pre- and manufacturing gate valves and actuators, staging of frac trees and ancillary equipment, so it made sense to enter the frac market as which further increases the flexibility of our a full service frac valve/frac tree provider. We customers’ on-site operations. To properly offer a broad range of frac tree systems from test and maintain our frac equipment while 2-1⁄16” 10M through 7-1⁄16” 20M, equipped mobilized, dual air-powered greasing units with manual and/or actuated valves available are used. Because simultaneous operation by on either a purchase or a rental basis. Frac two service technicians is possible, greasing stands are also available to facilitate safe time is reduced between frac stages. The access to all the valves and critical outlets or trailer unit also supplies air for torqueing connections on these very large trees. tools and optional pressure testing services. To simplify customer operations, we serve Solutions-based on-site support as a single source for all ancillary equipment Our fully trained field technicians are for frac trees, including wellhead isolation available 24/7 to safely and efficiently sleeves, back pressure valves or two-way deliver, install, service, or remove check valves, lubricators, hydraulic closing frac equipment on-site, delivering the units, and multi-access frac heads on a superior performance our customers per-day rental or project basis. To further expect. Strategically located service enhance our frac equipment offering, a full centers are equipped with the latest complement of associated frac equipment technology to safely disassemble, inspect,Completed BHP Billiton Petroleum well. services is available to properly install, repair, refurbish, and disposition frac equipment upon its return from the field. A comprehensive inventory of spare components is stored in each location to ensure rapid equipment turnaround. We are working to ensure that as our customers’ needs evolve in unconventional resources, GE Oil & Gas will deliver the quality and attention to HSE that the industry demands. GE Oil & Gas Pressure Control 4424 W. Sam Houston Parkway N. Suite 100; Houston, TX 77041 P.O. Box 82; Houston, TX 77001-0082 Phone: 832-325-4200 Fax: 832-325-4350 www.geoilandgas.com/pressurecontrolLarger rental frac stacks are often configured with frac tree stands which provide easyaccess to upper valves and connections. qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®54 BHP Billiton COMPANY PROFILE HALLIBURTONHalliburton’s Well-Construction TeamCollaboration Leads to Successful ShaleDevelopmentsBHP Billiton Petroleum has expanded reliable data-collection effort. The coresits fleet of North American shale rigs are highly useful in defining the mixedover the past six months, and relied mineralogies of the play, as well as helpfulheavily on their vendors for achieving in better defining the petrophysical logtheir improved success. Some of the rigs evaluations. The core data is also used toemployed Halliburton’s Red Team, which define what is required in the mud system,increased operational efficiency as a the geomechanics of the play, and helps inresult of each product service line (PSL) defining the best design components (fluidsunderstanding how the related service and proppants) for the hydraulic fracture.lines work and interact with one another, The successful BHP Billiton Petroleum coringas well as collaborating with the BHP campaign conducted in the Eagle FordBilliton Petroleum team. Information passes Shale resulted in six of seven wells withseamlessly between the Red Team for 95% recovery or higher, for an average coreeach product service line. Collaboration recovery of 96%.and data integration by a single sourceservice provider increases operating Well Constructionefficiency while a burden is removed from Since August, 2011, the Halliburton drillingthe operator’s drilling team to provide data team (Sperry Drilling services, Baroid,and operational details to different service Halliburton Drill Bits and Services, andproviders. The BHP Billiton Petroleum drilling Cementing) and BHP Billiton Petroleumteam is afforded greater opportunity to worked together to plan and execute thefocus on overall optimization and improved wells as efficiently as possible. BHP Billitonsuccess while Halliburton provides wellbore Petroleum and Halliburton together drilledevaluation, well construction, completions, 110 wells as of mid-September 2012. Theand production sustainability. team reduced the number of drilling days per well from 30 days to just under 10Wellbore Evaluation days. This was accomplished by, amongTo evaluate the complexities of the Eagle other things, improving data transmissionFord Shale, Halliburton’s Open Hole for faster data collection, tailoring mud Halliburton Drill Bit and Services (HDBS)evaluation services deployed the Hostile programs to meet each wellbore challenge, —8 3/4-in. FXD55MRotary Sidewall Coring Tool (HRSCT™) and matching the correct bit to thedevice to obtain formation core samples formation through custom design usingthat are more than three times the volume geomechanics data. Halliburton Drill Bits and Services (HDBS)of standard sidewall cores and have a highly continuously develops bits to control the Sperry Drilling deployed its tool face while providing improved speed electromagnetic (EM) measurement- and performance. Directional features Percent Number while-drilling (MWD) system to reduce Attempts Coring have been strategically incorporated into Recovered survey time. The EM system establishes Efficiency our bits to create a perfect partnership a two-way communication link between with the higher differential-capacity 31 31 100.0 the surface and the MWD equipment motors that Sperry Drilling introduced to 28 27 96.4 downhole using low-frequency meet BHP Billiton Petroleum’s goal for 38 36 94.7 electromagnetic-wave propagation to reduced nonproductive time. This success facilitate high-speed data transmission produced multiple one-bit-run wells and 27 26 96.3 to and from the surface. The use of this improved drilling-curve performance that 13 13 100.0 technology over the drilling campaign culminated in drilling a complete 1,000-ft 13 11 84.6 saved BHP Billiton Petroleum an estimated (305 m) 3D curve in less than nine hours. 16 16 100.0 $2.4-3.5 million over the 110 wells drilled By implementing the optimized operating in the Fayetteville Production Unit. parameters, as well as by using the new qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 55 operation time by 30 percent on zipper fracs. Besides perforating and setting plugs, Wireline also provided services to confirm zonal isolation for well integrity. Production Sustainability Multi-Chem, a Halliburton service, used purpose-built application trucks and a specially designed process to provide accurate and reliable delivery of biocides, scale, and surfactant chemicals. Multi-Chem also provided post-frac monitoring, which is critical for continuous process improvement by allowing the determination of whether the biocide treatment is effective or if a reevaluation of the treatment protocol is needed. Multi- Chem continues to process and evaluate data for wells for which it provides post-Sperry Drilling electromagnetic (EM). frac monitoring and provides BHP Billiton Petroleum with monthly reports.motor and bit designs, the curveinterval mud displacement while minimizing Multi-Chem developed the industry-average ROP for the 8 3/4-in. FXD55M bit potential losses in order to optimize leading MVP 2.0 Web-based Chemicalincreased dramatically from 54 to 84 ft/hr. cement placement and coverage for long- Management Software for production- term wellbore architecture integrity. chemical treatments. This software allowsIn the Fayetteville and Eagle Ford Shales, BHP Billiton Petroleum to easily andHalliburton Baroid worked very closely Completions precisely track all of their data related towith other team members to enhance BHP Halliburton’s Well Construction team production chemicals. The key to effectiveBilliton Petroleum’s drilling performance completed 452 tubing-conveyed perforations production-chemical management isby using Drilling Fluids Graphics (DFG™) (TCP) gun runs with a +99.5% efficiency trend-related data. One-off data cansoftware that enabled the prediction of rate. Hydraulic fracturing operations were be misleading and result in irrationalhole-cleaning efficiency, ECD modeling, impressive, as well. Ninety-five percent of decisions. MVP 2.0 allows easy setup andand simulations of drilling conditions to the planned proppant was placed with a monitoring of key performance indicatorsdetermine the best operating parameters. 99.4% success rate during a total of 2,181 specific to BHP Billiton Petroleum fields inBy analyzing mud properties throughout the hours of actual pumping time. The treatments South Texas and Arkansas.resource play areas, Baroid pinpointed mud consisted of friction-reduced water and sand.properties that reduced costs and enhanced The team conducted the first zipper frac for Summarydrilling performance. Invert emulsion drilling BHP Billiton Petroleum, which enabled an Halliburton’s Red Team working with BHPfluids (IEF) were designed specifically for average of 7 stage fractures to be created Billiton Petroleum has enabled significantformations that were drilled through to reach per day versus the typical 4.5 stage fractures efficiencies for BHP Billiton Petroleumthe geological target while reducing the to be created per day on a single well. Also, resource plays. This has resulted innumber of drilling days and cost per foot. greater fracture complexity was created from cost savings and production increases, the zipper frac enabling greater reservoir which provided significantly improvedBaroid worked closely with BHP Billiton stimulated volume to be provided to BHP profitability for BHP Billiton PetroleumPetroleum on lost circulation strategies Billiton Petroleum. Production Enhancement shale-resource plays.while drilling the Wilcox sand formation. worked with Sperry Drilling to minimizeWith continued drilling and fracturing in the potential of screenouts based uponthe Eagle Ford formation, mud densities well placement and wellbore configuration. Halliburtonare becoming more difficult to manage due This is a unique benefit gained from using 10200 Bellaire Blvd.to the ever-narrowing window between Halliburton products and services.the pore pressure and fracture gradient Houston, TX 77072increasingly challenged by the fracturing of Halliburton’s Wireline team had 281/575-3000offset wells. Baroid Technical Professionals an excellent track record of 99.6% www.halliburton.comworked closely with the Halliburton effectiveness for perforating and plugCementing Technical Professionals in setting. They adopted an innovativeoptimizing rheological and physical technology (lubricator stand) used in theproperties of the fluid train for maximum Rocky Mountains which reduced wireline qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®56 BHP Billiton COMPANY PROFILE JACOBSJacobs Focuses on Safe, Optimal Operationsand Efficient Delivery to MarketJacobs (NYSE: JEC) is one of the world’slargest and most diverse providers oftechnical, professional, and constructionservices. The company provides allaspects of architecture, engineeringand construction, operations andmaintenance, and scientific and specialtyconsulting to a broad range of companiesand organizations including industrial,commercial, and government clients acrossmultiple markets and geographies.In the upstream oil and gas market, Jacobsoffers a full range of services, rangingfrom conceptual and detailed design,engineering, procurement, constructionmanagement (EPCM) and commissioning,to operations and maintenance (O&M).Jacobs’ experience and capabilities run thegamut from oil to natural gas to naturalgas liquids (NGLs) and heavy oil (usingsteam assisted gravity drainage), produced such as those described here for BHP Billiton Petroleum’s shale developmentfrom conventional and unconventional Billiton Petroleum. Many of Jacobs’ past projects at the Eagle Ford and Permianresources including shale, and using and current projects in North America are Basins in Texas, and at the Fayettevillesecondary/tertiary production techniques contributing significant production growth shale in Arkansas. Bringing an optimizedsuch as CO2 enhanced oil recovery for both in the region. development philosophy to these projects,onshore and offshore field development Jacobs develops standardized designs andand production. Jacobs and BHP Billiton specifications and leverages volume and Jacobs has a long standing relationship critical equipment procurement, enablingClients worldwide rely on Jacobs to with BHP Billiton, across multiple project BHP Billiton Petroleum to move itsdeliver and maintain their upstream sites and facility types, including onshore products to market quicker.facilities, including oil and gas gas plants, mining, and minerals facilities.production sites, topsides for offshore oil Our relationship with BHP Billiton spans Eagle Ford Shale Developmentplatforms, and separation and gathering over 28 years: from the 1980s, delivering At the Eagle Ford Shale asset in southsystems. Jacobs also has vast experience offshore petroleum projects in the Timor Sea Texas, Jacobs provides engineering,and expertise in processing facilities such and major mining facilities in Australia and procurement, and commissioning servicesas gas treatment (sulfur, CO2, acid gas South America; to the 1990s working with for gas and liquid handling facilities andremoval, and others) and fractionation the steel, petroleum, and mining businesses; central delivery points (CDPs). Workfor NGL in addition to liquids recovery, and now the 21st century, where we began on these facilities in 2012 and iscompression, and transportation, continue to support BHP Billiton’s customer ongoing. The facilities gather and processincluding pipeline systems. Jacobs’ service groups around the world. natural gas, condensate, and light crudeintegrated services include regulatory in the Karnes, Hawkville, and Blackhawkaspects such as environmental With global experience in petroleum, areas of the basin. The processed gasassessments, permitting, as well as uranium, copper, and nickel, Jacobs is proud is sent through a sales pipeline, andwater management. to have provided study, engineering, and condensate is transported to markets construction management services to many via trucks. Jacobs’ scope of work atHaving worked with all the major of BHP Billiton Petroleum’s major projects. Eagle Ford includes gas compression,producers and operators in the oil and gas glycol gas dehydration, amine treating tosector, Jacobs also has a growing portfolio Jacobs is currently providing engineering, remove CO2, condensate stabilization,of projects and services in the area of procurement, and commissioning services modular compression systems and treatingshale and other unconventional basins, for the surface production facilities at BHP qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 57facilities, vapor recovery, and exportfacilities via pipeline or truck.Permian Basin Shale DevelopmentFor the Permian Shale asset in west Texas,Jacobs is providing engineering andprocurement services for a gas and liquidshandling facility to gather and process naturalgas, condensate, and light crude in thePecos area of the Permian Basin. This earlyproduction facility will support BHP BillitonPetroleum’s field development planning andexecution in the basin. The project includesgas compression, glycol gas dehydration,condensate stabilization, and storage and The Karnes site in the Eagle Ford basin.truck loading for water and condensate. Likethe Eagle Ford facility, processed natural gaswill be sent through a sales pipeline, while repeat customers. This strategy yields and innovation that can provide significantthe condensate is transported to markets by strong, long-term relationships with cost savings in design and planning;truck. Jacobs’ work began on these facilities clients leading to value maximization, • Ability to leverage high valuein 2012 and is ongoing. cost advantages, profits, and predictable engineering centers and global project delivery for clients. The procurement capabilities. combination of a loyal client base and steady growth enables Jacobs to attract A Sustainable Approach and retain the industry’s top professionals. With the drive and expertise to progressively and cost-effectively reduce BeyondZero® – Jacobs’ World the environmental impact and resource Class Approach to Safety intensity of projects worldwide, Jacobs’ Jacobs is dedicated to keeping its commitment to running an ethical, employees, clients, contractors, and relationship-based, and cost-conscious their families safe and healthy through business enables the company to help its its BeyondZero ® safety program, which clients find the best sustainable solutions promotes a culture of caring that extends for their projects around the world. beyond the office and work sites. Jacobs’ safety culture combines comprehensive Jacobs delivers tangible, technical safety policies and procedures with solutions that support customers’ leadership commitment and a genuine improved profitability. With comprehensiveA compression skid at the Karnes site. care and desire for every individual to be knowledge and experience across a incident—and injury—free. Jacobs plans diverse range of resources and processes,Fayetteville Shale Development safety into the design, implementation, conventional and unconventional –At the Fayetteville Shale asset, Jacobs and operation of each project. In 2010, including shale oil and gas production,worked with BHP Billiton Petroleum the Occupational Safety and Health heavy oil, enhanced oil recovery, andto provide engineering services for Administration (OSHA) recognized Jacobs onshore or offshore production – Jacobsinfrastructure development at existing for excellence in worker safety and health offers a complete service to supportoperating facilities, as well as process by approving the company as a Voluntary customers’ continued growth andsafety management (PSM) services. The Protection Programs (VPP) Corporate competitive edge.work scope included HAZOPs, facility participant. Only seven other corporationssiting, regulatory compliance, and currently hold this recognition in the U.S.conceptual designs for water management Jacobs Engineering Group Inc. Jacobs also brings disciplined and value-systems integrating fresh and produced 1111 South Arroyo Parkway added execution through its:water handling, transportation, storage, Pasadena, CA 91109and treating. • Integrated EPCM approach; Phone: 626.578.3500Building Long-term Client • JSTEPS ® structured work process; Website: www.jacobs.comRelationships • Value Enhancing Practices thatJacobs’ fundamental business strategy is strategically implements Value Improvingbuilding long-term client relationships. Practices (VIPs) to ensure best practicesOver 80% of Jacobs’ projects come from qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®58 BHP Billiton COMPANY PROFILE NABORSInnovative Technology DesignedSpecifically for Shale ProjectsNabors Drilling DesignsPACE®-X Series Rigfrom Crown to Groundto Optimize Well‘Manufacturing’ fromMulti-Well Pads; Sixare scheduled for theHaynesville and Eagle FordNabors Drilling USA, LP started workingfor Petrohawk in the Haynesville Shale in2007. At that time, initial wells averaged80 days per well. Today, the companycontinues to meet the demands of thatpartnership with BHP Billiton Petroleum,using programmable A/C electric (PACE ®)rigs with automated technology. Nabors’PACE® -M Series rigs helped reduce drill well pads. Experience and technology from “One of the many benefits of the PACE ® -Xtimes in the Haynesville to an average of Nabors rigs operating all over the world rig is its visually simple concept,” said32 days. In fact, Rig M46 drilled a field- were incorporated into the design.” Clark. “The straightforward designrecord well in 20.8 days. decreases hesitation by trucking companies The PACE® -X rig can skid on both the and rig crews during rig-up and -down.Customers like BHP Billiton Petroleum X and Y axis, with a 16-ft-wide by 27-ft Plugs and cables have been reduced due toare looking for the latest technology tall clearance below the substructure the split VFD design and distributed powerwith compact but powerful equipment. to optimize batch drilling, or dodge an systems. This makes the rig easier to han-They want faster moving features, existing well head. A 20% improvement dle and maintain.”enhanced safety elements, better power in skidding efficiency equates to savingdistribution, greater torque control and about 1.5 days on an eight-well, batch Currently, six PACE®-X rigs are scheduled forhigher penetration rates. When these drilling pad. Another primary target of the deployment in the Haynesville and Eagle Fordobjectives are accomplished, they allow design was to reduce flat time with the Shales. Nabors is on target to deliver the firstoperators to drill more efficiently and rig’s ability to stump-test offline in order PACE®-X rig in late 2012.move more rapidly. Nabors has used to handle the BOPs more quickly.these advancements while drilling for BHP Advanced AutomationBilliton Petroleum to pave the way for the The PACE®-X rig can provide more capable Canrig Drilling Technology Ltd., a Naborsnext generation of PACE® technology. horsepower at the bit than any other rig of company, continues to provide directional its size, said Clark. It will accommodate up drilling solutions with ROCKIT®, a surface“Nabors has designed a new rig that to four 3,516 diesel or natural gas engines, rotary steerable system. It has quicklymeets the demands of shale plays, such up to three 2,200-hp, 7,500-psi mud pumps, demonstrated its ability to save rig timeas the Eagle Ford and Haynesville,” said a 2,200-hp AC Canrig COMMANDER™ through faster toolface setting andRandy Clark, vice president, marketing Drawworks and a 500-ton Canrig AC top improved toolface control, which increases– Southern Division. “We interviewed drive. Unparalleled horsepower, pressure the penetration rate while sliding.customers to create a rig configuration and torque is delivered to the bit. More thanthat would meet their current and future 20,000 feet of fi ve-inch drill pipe can be set “The ROCKIT® platform also includesneeds. The PACE ® -X Series rig was back, optimizing the long laterals that have our ROCKIT® HEADS UP DISPLAY™ anddesigned from the crown to the ground become the new standard. ROCKIT® PILOT™ automation products,”to optimize well manufacturing on multi- said Rob Guillory, vice president of Sales qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® BHP Billiton 59and BHP Billiton Petroleum account Canrig’s REVIT™ system employs Soft Coiled Tubing Servicesmanager. “The ROCKIT® HEADS UP Torque® technology to mitigate torsional Nabors continues to build a fleet of mobileDISPLAY™ integrates the surface-based vibration in real time and allow drillers to coiled tubing units that are used primarilyinstrumentation and MWD downhole achieve a level of performance that was in well intervention to support hydraulicdata so that the driller has immediate unthinkable just a few years ago, Guillory fracturing on operating wells as well as inaccess to all the information required to noted. The system integrates seamlessly well-servicing operations.steer the directional well. The ROCKIT™ with the Canrig AC top drive controls toPILOT™ control system allows the top alert the driller to excessive downhole “We have 12 coiled tubing units that aredrive PLC to automate toolface steering, vibration and provides sophisticated tools tailored specifically for the shale markets,”providing predictable bearing offset to eliminate stick slip, he added. REVIT™ said Perry Courville, director of coiledcorrections which are repeatable and users experience increased ROP, extended tubing services. “We customized the stringbased on directional drilling logic. Both are bit life, and fewer downhole tool failures, all design through a variance of the wallvaluable enhancements to the ROCKIT™ of which equates to significant cost savings thickness to optimize the horizontal reachtechnology.” associated with reduced down time. capabilities in the shale play completions. We have the ability to provide 23,000 ft “Our customers also have access to Canrig’s of 2-in OD coil. This is the optimal size world-class RigLine 24/7 support service needed to intervene in these wells. The staffed by certified REVIT™ technicians coil units are matched with pumping who are specially trained to monitor and equipment tailored specifically or these analyze the product’s performance as diameter and reel lengths. The trailer- well as the performance of associated rig mounted, twin pumping units provide 600 systems and to take immediate action if hydraulic hp each and work independently that performance is less than optimal,” said for maximum efficiency.” Guillory. ”REVIT™ is a high-technology product that reacts automatically and Courville says the design was a direct instantaneously to mitigate stick-slip. It result of Nabors’ willingness to meet the reflects Canrig’s dedication to developing growing demands of the shale market.Guillory also notes that one of the biggest new technology that automates the drillingproblems facing the drilling industry today process and meets both customer and “The increased activity in shale playsis non-productive time due to downhole market demands.” has shaped the coil market uniquely,” hevibration. Vibration can destroy drill bits, said. “As few as four years ago, the coileddamage expensive downhole tools and There are currently more than 70 REVIT™ tubing units were a different size andlead to tool failures and poor drilling systems operational. It is expected that configuration. Since we didn’t want ourperformance. Canrig will have about 100 systems in customers to have to incur extra costs to operation by the end of 2012. get down to TD, Nabors optimized the coil unit’s configuration and the string design for a greater reach. We took into consideration rig-up times and the ergonomics of working with large-diameter pipe. As a result, our customers end up with better equipment that runs more efficiently and less expensively in any shale market.” Nabors 515 W. Greens Road Houston, TX 77067 Tel: 281-874-0035 Email: Randall.Clark@nabors.com Website: www.nabors.com qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®60 BHP Billiton COMPANY PROFILE JET MAINTENANCEJet Maintenance provides complete servicesolutions for all oilfield construction needsJet Maintenance, an oilfield constructioncompany based in Victoria, Texas, hasbeen providing premium turnkey servicesto the oil and gas industry since 1992, andhas established itself as a leader in oilfieldconstruction in south Texas.Jet provides all construction servicesnecessary for pre-drilling and post-drillingoperations. With over 40 pieces of heavymachinery ranging from backhoes, rollersto dozers, trackhoes, and scrapers, Jet isable to offer a broad range of commercialconstruction services. We specialize in theconstruction of pad locations, lease roads,frac ponds, fencing, and other pre-drillingconstruction services. When drilling andcompletion operations are complete, Jet hasroustabout crews that clean and hook up thewell site. Jet also has the ability to perform Jet Maintenance constructs all aspects of the drilling site — roads, drilling pads, cellars,pipeline work, such as digging trenches, frac ponds— everything necessary for a safe and successful well.welding pipe, and installing pipelines.The company has an extensive welding Jet also has the ability to haul and deliver and doing everything possible to keepcrew composed of its own employees that its own aggregate material through material procurement on time, their projectperforms various fabrication work for all AW Trucking, also located in Victoria, Texas. deadlines on schedule, and their projectoilfield needs. Jet’s welders can perform budgets under control.field work, such as well hookups, pipelines, Providing premium servicesand on site fabrication. The company also in Eagle Ford since 2004 Driven by excellence in execution, Jet ishas a fabrication shop, located in Victoria, Beginning with Petrohawk, one of the committed to ensuring the safety of itsTexas, in which it can build chemical loops, original operators in the Eagle Ford Shale, employees. Jet maintains an excellentknockouts, fuel bottles, cellar covers, Jet Maintenance has been providing its safety record, demanding the highest safetycrossovers, and much more. premium services to operators in south standards from and for its employees. Texas since 2004. When BHP Billiton Jet Maintenance has been a member of Petroleum acquired Petrohawk in 2011, the ISNetworld since 2003. company continued to provide its premium services for BHP’s exploration programs, building more than 70 drilling locations in JET MAINTENANCE south Texas since the acquisition. P.O. Box 5026 Jet delivers superior value Victoria, TX 77903 with outstanding quality Phone: (361) 576-3226 Jet Maintenance’s success is the result of Fax: (361) 578-0054 its superior service and extra attention Website: www.jetmaintenanceinc.com to detail throughout its operations. The company has a loyal, dedicated, and diverse staff that increases its ability toWith over 40 pieces of heavy machinery, Jet successfully differentiate its products andis able to offer a broad range of commercial services from the competition. Jet is veryconstruction services. customer-focused, committed to providing solutions to all of its customers’ needs, qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND® COMPANY PROFILE SCHLUMBERGERTechnology and Collaboration forNorth American Shale DevelopmentA game-changing technology has been the performance of these assets in a safedeployed in the Eagle Ford over the last and effective manner. By integrating the rock24 months, which has allowed BHP Billiton properties into the completions design, BHPPetroleum to produce its Blackhawk and Billiton Petroleum will be able to optimizeHawkville wells at improved production the staging and HiWAY frac design, allowingrates while reducing the water and proppant the reduced consumption of resources andusage in these fields. To date, 3,200 lowering the overall costs per barrel to deliverfracturing treatments have been performed these hydrocarbons to market.in more than 200 Blackhawk and Hawkvillewells. The technology has allowed savings Spear shale-optimized steel-body bitin excess of four million barrels of water Smith Bits, a Schlumberger company, and BHPand 200,000 tons of proppant with respect Billiton Petroleum drilling engineers continueto conventional fracturing techniques. This to work closely on optimizing and utilizinghas prevented more than 30,000 proppant Spear* shale-optimized steel-body PDC bits.and water hauling trips and eliminated more Spear PDC bits are the industry-leading steel-than five million pounds of CO2 emissions. body PDC bits developed with Schlumberger The HiWay service uses specialized blending proprietary “Shale Smart” technologies andHiWAY flow-channel hydraulic equipment and control systems to pump engineered to increase drilling performance infracturing service proppant in pulses—creating stable, the curve and horizontal shale sections whileThe technology that has made this possible infinite-conductivity flow channels in not sacrificing directional control. fractures.is called HiWAY* flow-channel hydraulicfracturing service, a patented process that Using the award-winning, in-house, IDEAS*creates highly conductive paths or channels taken the technology to the Delaware integrated drillbit design platform, the PDCwithin the hydraulic fractures. Like most Basin. The company’s asset team is working cutting structure and steel-bit-body geometrysuccessful technologies, the basic concept jointly with a Schlumberger petrotechnical are designed to meet and exceed the goalsbehind the technology is simple: instead of team of experts to complete basin-scale of BHP Billiton Petroleum for each drillingfilling or packing the fracture with proppant resource assessments of the Delaware application. In the first half of 2012, BHPas is done with conventional treatments, and Midland basins. An integrated Billiton Petroleum’s use of Spear bits and allproppant is placed in engineered clusters 3D geological, geomechanical, and of the technologies therein has increased theto promote the formation of voids, gaps, petrophysical model of the Delaware Basin average footage drilled per bit by 33% in theor channels through which oil and gas can was created in the Petrel* E&P software Eagle Ford curve and lateral sections comparedflow expeditiously. platform to characterize production-driver to non-Spear PDC bits in the same intervals. heterogeneity, rank the acreage, and assistThe HiWAY channel fracturing service Through collaboration and application of new in developing the drilling program.combines geomechanical modeling, and innovative technologies, Schlumberger andintermittent proppant pumping and Reservoir simulation is being applied to BHP Billiton Petroleum are working togetherdegradable fibers and fluids to attain the calibrate production forecasts, which will to unlock these resources. This approach hasheterogeneous placement of proppant within be made across the basin. Tried and tested resulted in improved economic performancethe hydraulic fracture. BHP Billiton Petroleum workflows are being used to deliver an through greater efficiency, productionpioneered the use of this technology in integrated heterogeneous earth model that optimization, and informed decisions.horizontal wellbores worldwide and has integrates reservoir and completion qualitybecome an industry-recognized leader in the within a single platform. A new Petrelimplementation of this breakthrough service. plug-in called Mangrove*reservoir-centric Schlumberger stimulation design software will be used 1325 South Dairy Ashford,Collaboration—Workflows to link the G&G model to the operationaland Mangrove Houston, TX 77077 decisions concerning the drilling and www.slb.comAs an early adopter of technology and completions program.committed to the value of producing“more with less”, BHP Billiton Petroleum Through collaboration and utilizationcontinues to expand the use of the HiWAY of innovative technologies, tools, andservice in the Eagle Ford, and has recently workflows, the team is working to improve*Mark of Schlumberger qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®
    • qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®BHP Billiton Petroleum1360 Post Oak BoulevardHouston, Texas 77056(713) 961-8500 qM qM Previous Page | Contents | Zoom in | Zoom out | Front Cover | Search Issue | Next Page qM M Mq q Qmags THE WORLD’S NEWSSTAND®