Slide 1

Hydraulic Fracturing Slide 2 60 Years of Hydraulic Fracturing 1949 to 2010 On March 17, 1949, a team comprised of Stanolind Oil Company and Halliburton personnel converged on a well about 12 miles east of Duncan, OK, to perform the first commercial application of hydraulic fracturing. Later the same day, Halliburton and Stanolind personnel fractured another well near Holliday, TX. The technique had been developed and patented by Stanolind (later known as Pan American Oil Company, then Amoco, and now BP) and an exclusive license issued to Halliburton to perform the process. In 1953, the license was extended to all qualified service companies. Since that day in 1949, hydraulic fracturing has done more to increase recoverable reserves than any other technique, and is a must for commercial production from most North American reservoirs Slide 3 Hydraulic Fracturing Essential Technology Well over 1,500,000 wells hydraulically fractured (since 1949) >40,000 NA wells fractured in 2011 > 125,000 NA fracture treatments in 2011 > $20 Billion NA market Essential for most unconventional resources Gas shales (and oil) Tight sands Slide 4 Slide 5 Slide 6 Stimulate the Well Optimize each stage with appropriate stimulation design. Monitor Each Stage in real time Slide 7 What Do Fractures Really Look Like? 500 m Slide 8 Downhole Microseismic Monitoring Treatment Well Observation Well Typically 12-3C Level @ 40 ft Observation Distance Depends on Seismic Attenuation Perforated Interval Microseismic Monitoring Is Applied Earthquake Seismology (Seismology 101) Based On Principles Known For Decades Has Been Used Since Mid-1970s (Hot Dry Rock) Primary Difference Is The Use Of A Downhole Array Slide 9 Mapped microseismic height for Barnett shale Top: shallowest microseism; Bottom: deepest microseism Aquifers: USGS deepest water wells by county Smallest height growth at shallow depths Large spikes are likely fault interactions Slide 10 Mapped microseismic height for Marcellus shale Top: shallowest microseism; Bottom: deepest microseism Aquifers: USGS deepest water wells by county Smallest height growth at shallow depths Slide 11 Mapped microseismic height for Woodford shale Top: shallowest microseism; Bottom: deepest microseism Aquifers: USGS deepest water wells by county Smallest height growth at shallow depths Slide 12 Mapped microseismic height for Eagle Ford shale Top: shallowest microseism; Bottom: deepest microseism Aquifers: USGS deepest water wells by county Smallest height growth at shallow depths Slide 13 Mapped microseismic height for Niobrara Top: shallowest microseism; Bottom: deepest microseism Aquifers: USGS deepest water wells by county Smallest height growth at shallow depths Slide 14 Conclusions Decades of study and monitoring of thousands of fracture treatments have demonstrated: Fracture treatments in shales do not grow into aquifers Microseismic data Simple volumetric calculations Fracture growth vertically is inhibited by layering & interfaces Mineback, laboratory, numerical, and field studies Fracture growth in the near-surface region is limited by horizontal components Tiltmeter data, stress measurements Faults can influence fracture growth, but do not provide pathways for fracture fluid to reach the surface From a mechanics perspective, hydraulic fracturing is safe! Slide 15 Common Fracturing Chemicals typically used at