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For 30+ years, this E&P company has thrived by adopting transformative technologies. Recently it began using a new system to increase profits by reducing geosteering operations from hours to minutes with real-time data, improving communication efficiency between engineers and geophysicists, and by integrating seismic information with well data.
IHS Energy with IHS Kingdom®
Swift Energy Company has been a major player in energy exploration and production for more than thirty years. Despite market volatility, the company has thrived by seizing opportunities, including early adoption of technologies that have transformed oil and gas exploration and production. Over the life of the company, this has led Swift to projects from West Virginia and Texas to New Zealand. For 2012, the company reported 11.1 million barrels of oil equivalent (MMBoe) produced and a record 192.1 MMBoe in proved reserves.
In the wake of such events, global organizations small and large will struggle to perform and could face a critical inflection point determining their future success or failure. Each industry could witness shocking market exits, not unlike the collapse of Lehman Brothers in 2008, where cutting production and reducing costs ran rampant as a reactionary survival strategy rippling throughout supply chains.
Business Challenge: Accurately Position Wells to Increased Production
Much of Swift’s current focus is on its 75,000-acre holdings in the Eagle Ford Formation, the 50-mile wide, 400- mile long swath of oil and gas-rich shale that runs under much of south Texas. Eagle Ford’s high carbonate content makes it highly suitable for hydraulic fracturing and one of the most actively explored areas in the United States. From January through November of 2012, the Eagle Ford yielded 964 million cubic feet of natural gas per day, and oil production of nearly 339,000 barrels per day (according to the Railroad Commission of Texas).
While the potential rewards in Eagle Ford are great, so are the technological and economic challenges. First, the most effective way to reach the reserves is through horizontal wells, which can cost three times as much as traditional vertical drilling. Second, the wells must be fractured in order to make a reservoir with permeability. Because of the accompanying increased investment, accurately targeting the reservoirs is even more critical.
Achieving that accuracy, however, has traditionally been hampered by several factors:
IHS Kingdom’s Dynamic Depth Conversion has been invaluable. The corrections we can make on-site… enable us to continually refine the model as we go. And that makes us much more effective at staying in the zone.
Dynamic Depth Conversion: Innovation to Target the Sweet Spot
To help improve the efficiency of its exploration and drilling operations, Swift has come to rely extensively on IHS Kingdom geoscience software. IHS Kingdom automates many of the key elements that previously presented the biggest challenges to a well’s success.
Bruce Moriarty is a Swift geophysical advisor whose job includes bringing the newest and most innovative technology to the company’s asset teams. As a IHS Kingdom user, he quickly realized the benefits of the most recent release to improve operational efficiency and profitability.
“When I saw how effective the new features are, I pushed to have it implemented on as many projects as possible,” Moriarty said. He added, “It has enabled us not only to do things faster, but to improve our decision making so we do them better.”
In a recent study, Swift proved that wells planned using this new technology stayed in-zone significantly more than wells using conventional approaches—and were more profitable.
The feature that had the biggest impact on Swift’s operations is IHS Kingdom’s Dynamic Depth Conversion (DDC), which builds and maintains a virtual velocity model and automatically converts seismic results from time to depth. That means engineers and geologists at the well site can leverage the value of seismic data to optimally guide the placement of the well. If geosteering adjustments are needed, they are then guided by ongoing, real-time data acquisition in the field, which is completed in minutes, not hours.
Better Communication Yields Better Results
In addition to making drilling more accurate, IHS Kingdom has also improved the ability of key personnel to work together. By integrating seismic information with well data, engineers and geophysicists are able to coordinate their activities more quickly and efficiently than ever before.
Moriarty pointed out, “Everyone is speaking the same language now, so everyone is on the same page at the same time.”
Lower Risk, Better Production
The predominance of high-risk, high-cost hydraulic fracturing and the pressures on producers to pull the absolute maximum production from resources is higher than ever before. This led Moriarty to comment, “One thing we’ve learned is that to make shales profitable, you must work hard to earn absolutely every barrel possible.”
Exploration and production in Eagle Ford and fields around the world will continue to be high-stakes, high- pressure propositions. But no matter where they take place, the tools and functionality provided by IHS Kingdom improve operational efficiency, productivity and the odds—as well as the actual frequency—of hitting the sweet spot.