Operations Research - Application of Optimizing Techniques for Studying Field Producing Operations

The purpose of this paper is to illustrate a comparatively new approach for solving a problem that has plagued oil producers for many years—how to make the most money with available field production capacity. In a very basic operation such as a top-allowable one-well field, a computer and staff of engineers are not required to determine that the best operation is to produce that well at its maximum for as long a time as it will produce. However, as the problem becomes more complex and the number of wells and number of reservoirs increase, it probably will be a wise choice to devote some engineering thought and calculation time to determine the best way to operate that field on both an ultimate and day-to-day basis. Continued developments in the field broadly referred to as "operations research" have led to a number of useful engineering analyses for optimizing field operational problems. One of these techniques, termed linear programing, is parlicularly interesting because of its potential applications to the study of complex oilfield operating problems. Linear programing is concerned with the problem of planning a complex set of interde~endenl activities in the best possible (optimal) fashion. A field application of linear programing is being used to maximize daily income from a multi-reservoir producing operation. The initial results of this study indicate that the linear programing technique (I) can be applied effectively to field problems, (2) can be used to detect unsuspected avenues for improving operations and (3) can effect a significantly improved means of controlling field operations through the use of the highspeed computer. INTRODUCTION The usual approach for studying complex field operational problems has been to look in detail at several basic plans suggested by judgement and experience and, then, to choose the best plan from those investigated. This approach is entirely satisfactory provided: (1) that judgment and experience alone will reliably pick the best or near the best program as one of the plans to be investigated; and (2), and most important, that the factors which control field production will not change. This paper deals with the large group of field operations which are at least one-step removed from a satisfactory solution using the conventional method of analysis. Problems such as pipeline- and gathering-system design, transportation studies, large field development projects and multi-reservoir producing operations fall in this latter category. To find the best program for handling these problems when the best program is not obvious, a complete optimization study is required, and high-speed computers are required to continually update the program once it is selected. Operations of this type have an extremely large number of possible solutions. However, only one will result in maximum economic return and, more important, this one program must be re-evaluated and adjusted constantly to accomodate such changing field factors as the number of producing days, the price of crude, the discovery of new reserves, declining reservoir pressure with subsequent decline in production and a host of other factors which characterize specific operations. One of the most widely used, direct methods of optimization is a numerical procedure termed "linear programing", which is designed to investigate systematically each of the possible solutions involved in a given problem, determining rapidly and uniquely the optimum answer. As implied by the name, linear programing requires that all field variables be either defined or expressed in a series of interdependent linear equalities or inequalities. These relationships are solved simultaneously, using a form of matrix solutions to determine the optimum values for each producing variable that will maximize net profits. The solution techniques used in a recent field case study is termed the "simplex method" and is discussed in full detail in Ref. 1.