Lightstream Resources, a frontrunner in successfully tapping the Bakken petroleum system in Saskatchewan, has examined three “tried and true” enhanced oil recovery concepts in the Bakken — waterflooding, natural gas flooding and carbon dioxide flooding — and concluded that CO2 is “probably the best technical solution,” Chief Executive Officer John Wright told the investment community at its annual meeting in mid-2012.
Enhanced oil recovery, or EOR, is not a new concept in the development of oil and gas reservoirs, but applying it to tight oil reservoirs is new, Lightstream says.
After laboratory analysis, computer simulations and early field experimentation, Lightstream, formerly known as PetroBakken, believes that natural gas would be “a more effective flooding agent in an EOR scheme as it would sweep the tight Bakken reservoir more efficiently,” says an entry on the company’s website, noting that Bakken “reserve recovery factors could improve from approximately 15 percent under primary methods to over 25 percent with natural gas as a flooding agent.”
Initially, natural gas used in the Calgary-based company’s EOR projects will come from its production facilities and is “expected to be recovered and sold at a later date, further enhancing the full cycle economics of EOR.”According to Wright, natural gas ranks second and waterflooding is viewed as the least effective.
The most effective is CO2, but because of the “incredibly poor quality” of Bakken rock, injecting fluid is difficult, he said, describing CO2 as a “great fluid to inject into the reservoir and a horrible fluid to run through your facilities, because it forms carbonic acid (which) eats through everything.”
Natural gas is cheaper and less corrosive than CO2 and the bulk of the gas can be recovered and sold, enhancing the full-cycle economics of EOR assuming gas prices recover, the company says.
Once primary recovery has taken place in the Bakken, Wright said his company expects to produce only 15 percent-17 percent of the oil-in-place, which he said would have been viewed as a “miracle” 10 years ago. “The flip side of that is we’re going to leave 83 percent to 85 percent of the oil behind because we don’t have a way to get it out,” he said.
Optimization through bilateral evolution
According to Lightstream, its “operational success in the Bakken is largely due” to its “depth of expertise in applying technologies. We are continuously innovating and evolving the efficiency of our horizontal drilling and fracture stimulation methods.”
The company developed a drilling and extraction strategy for bilateral wells.
“This dual-leg tactic provides increased exposure to this generally low permeability reservoir. In fact, four bilateral wells will fully develop a section in the Bakken, while eight single laterals are required to achieve the same well density,” Lightstream says.
“We have also been able to push the boundaries of the Bakken fairway with the introduction of delayed fracs, and Cleantech fracing solution.”
Maturing production and well optimization activities resulted in a leveling off in production from Lightstream’s Bakken business unit in southeast Saskatchewan, trimming output to 19,029 barrels of oil equivalent per day in the first quarter from 19,741 boe per day in the final three months of 2012, the company reported.
However, Chief Operating Officer Rene LePrade said “future drilling and optimization of our extensive inventory of existing wells” should mitigate production declines and generate free cash flow from the unit.
First-quarter activities in the Bakken included 15 wells, with 14 brought on production.
Cardium drilling
Company-wide production for January through March 2013 averaged 49,078 boe per day (82 percent light oil and liquids), an increase of 2,306 boe per day from the opening quarter of 2012.
Lightstream credits most of the growth to the successful execution of a drilling program in the Cardium, a formation that consists of massive sandstone beds separated by shale. Because the Cardium has a higher gas-to-oil ratio than the Saskatchewan Bakken, the company’s liquids weighting dropped slightly from a year ago, while temporary facility restrictions on the Cardium unit had a proportionately larger impact on light oil production.
As of March 31, the company had 30 wells waiting for completion and/or brought on production. Wright expects half of that total will come onstream by mid-year.
He said the Cardium should yield 25,000-30,000 boe per day through 2013 and 2014 and could edge over the 30,000-barrel mark for a “very long, extended period of time and make the best use of any infrastructure build-up that we’ve done, not unlike the Bakken which has turned into a 19,000-20,000 boe per day cash cow for us.”
