The Talk:

Caveat Emptor in Acquisitions, or ways I've seen people get burned using Conventional Practices of Decline Curve Analysis

Speaker: Dwayne Purvis

Abstract:

Conventional reservoir engineering tools must be viewed as potentially inadequate (or even inappropriate) for the evaluation of shale gas performance primarily because of the extremely low aggregate permeability of these systems, but also because of other unique aspects of the systems. Reservoir modeling (simulation) has an important role as an assessment and prediction tool; however, the character of the reservoir (induced and enhanced natural fractures) must be considered, as well as the geological and fluid characteristics. Rate-transient analysis (modern decline analysis) techniques are also more rigorous and have been expanded and adapted to fit the uniqueness of shale gas production. Application of each method for shale gas is discussed, including methods and limitations. These two techniques more closely represent the physics of shale gas production, but their implementation is often prohibitive.

By way of necessity, much engineering evaluation is performed using Arps decline curve analysis. This technique is argued by some to be inappropriate due to a lack of theoretical support and demonstrated tendency to over-estimate reserves in tight gas systems. Given the limitations, practical methods exist to reduce error associated with its use. A newer decline method, power-law exponential, is also investigated.

Biography:

Dwayne Purvis, P.E.  has spent over two decades in reservoir engineering and executive leadership as a consultant and operator.  He has led or participated in hundreds of field studies and reserve analyses over dozens of basins in the United States and abroad, and he has participated in the sale or acquisition of projects valued from tens of thousands to billions of dollars.

Before starting his own consulting practice in 2015, he served Jetta Operating Company as Reservoir Engineering Manager and Reserves Manager.  Prior roles include founder and Executive Vice President of consulting firm The Strickland Group and partner at Cawley, Gillespie & Associates.

Mr. Purvis has published on issues of reserves, risk analysis and shale reservoirs.  He is a registered professional engineer in the state of Texas, member of AAPG, SEG and a 25-year member of SPE.