Drilling used to be hit or miss. In the energy industry's early days, operators hammered cable tools into the earth, hoping to find crude oil or natural gas. But development of more sophisticated tools has enabled drillers to probe greater depths with more success in less time. Since the remaining hydrocarbons are more difficult to access, the search for oil and gas is constantly leading us into deeper waters and more remote terrain. Drilling and completions technologies have improved dramatically in recent years, enabling Chevron's portfolio growth.
Until the 1970s, rotary drilling in vertical wells was the dominant technique. However, we were not able to tap the full potential of reservoirs. Horizontal drilling, enabled by steerable tools, was developed in order to access areas of reservoirs that were previously inaccessible, thereby increasing production. More recently, the same concept has been pushed further with great results—directional and extended-reach drilling have enabled operators to access reservoirs far from the drilling location.
Completions technology also has evolved—installations are done in less time and reliably produce at greater rates. Cased-hole completion involves perforating the well casing and formation so that oil or gas can flow into production tubing. Open-hole completions are another option: Formations with weak rock often require sand screens and gravel packs to be inserted into the reservoir to stabilize the hole and maintain the flow of oil from the reservoir into the well bore. This process controls the migration of sand to avoid well failures and lost production. Next, acids and other fluids can be pumped into the well under high pressure to fracture, clean and stimulate the rock in order to increase our ability to produce oil or gas. Finally, production tubing is added to provide an efficient and safe flow to the surface.
What Chevron Is Doing
Chevron's long-term exploration and development strategy—which blends disciplined, data-driven decision making with superior technical competency—is paying off.
- In Kazakhstan, our Tengizchevroil joint venture uses closed-hole circulating drilling to manage pressure at the Tengiz Field, the world's deepest operating carbonate oil field. Fit-for-purpose casing design was introduced at Tengiz. The new casings are smaller, which improves overall drilling efficiency without compromising well integrity.
- In the Gulf of Thailand, where Chevron drills more than 300 wells per year, our "well factory" approach enables maximum efficiency with the minimum capital investment. All of the wells are developed using the same processes, practices and design. The performance of these wells helps make us Thailand's top crude oil and natural gas producer.
- Chevron successfully deployed a new completion system that saves significant time and cost in a deepwater development. The system was installed from 2012 to 2014 in five wells in the Jack/St. Malo project, in the Gulf of Mexico. The system enables the stimulation and gravel pack of multiple production zones in a single trip. Deployment in a single run allows more of the reservoir to be stimulated in less time, which increases efficiency, reliability and production. The success of this technology may lead to its use in other deepwater projects, which could result in additional cost savings and improved completion efficiency.
- An aggressive horizontal drilling campaign at California's Kern River Field has improved production at the century-old heavy oil field. At depths as shallow as 300 feet, the horizontal wells are drilled with steerable tools to overcome challenges posed by the softness of the surrounding earth. Horizontal drilling has slowed the field's production decline in a way its vertical wells could not.
- The complex geology in the Kurdistan Region of Iraq required new state of the art technology. Chevron used managed pressure drilling equipment and a new formation testing tool to successfully drill two exploration wells in the challenging environment.
- Chevron successfully drilled the deepest land well in the state of Louisiana. The pressures and temperatures encountered at these depths presented numerous challenges. We developed a new isolation packer and for the first time deployed special high-temperature logging-while-drilling tools that provide real-time data to gauge progress, ensure well placement accuracy, map the rock formation and measure the formation's properties. These new technological successes make the targeted zones new opportunities for further exploration.
Investing in New Finds
Chevron continues to be one of the world's more active operators. Key exploration areas are the U.S. Gulf of Mexico, the deep waters off western Africa and offshore northwest Australia. Drilling and seismic activities are ongoing or in various stages of planning in several other areas, including Argentina, Canada, China, Indonesia, the Kurdistan Region of Iraq, Morocco, Thailand and offshore the United Kingdom.
In addition to preparing new oil and gas wells for production, drilling teams also revitalize existing wells. This process involves repairing or stimulating the well—such as replacing the tubing or deepening the well—to restore or enhance its production of oil or gas.
Continued investment in drilling and completions technologies is important as wells become deeper, longer and more geologically complex and as we extract resources from challenging rock formations.
Updated: May 2015