Market conditions and the depressed price environment have driven unconventional operators to dramatically improve cost efficiencies since early 2016, which in turn reduced breakeven prices and increased returns. Although a large portion of those capital efficiencies can be attributed to reduced service costs, better use of technology to improve drilling efficiency and optimize completion and treatment designs has made the most significant contribution. Understanding how the reservoir reacts to a particular combination of treatment parameters and optimizing the design based on those observations has been key to the success of the project.

Combining the competitive nature of humans to outperform their peers and the desire to find solutions to technical challenges as geoscientists, operators acquire a plethora of data to understand an asset better, help improve its development and ultimately increase returns. The shale puzzle is a complex one with multiple variables. Success is no longer driven by structure as is the case for conventional reservoirs; it is driven by understanding the variability in geology, reservoir properties, the impact of treatment design parameters and hydrocarbon production as the ultimate expression of all variables.

A technology that lends itself to solving the problem and providing an unbiased observation of how variable geology responds to variable completion and treatment design is microseismic monitoring. Driven by historic acreage multiples, the need to maximize returns led most of the top operators in the Permian Basin to incorporate microseismic as a crucial element of their technology portfolio. As is the case with any type of data, microseismic is one piece of a large puzzle and needs to be integrated with other technologies and data to limit the degrees of freedom in models and arrive at a well-constrained solution.

The industry has long called for integration into reservoir simulation and hydraulic fracture modeling to turn microseismic data from a scientifically interesting observation into something actionable.

Seven out of the top 10 operators in the Midland Basin integrated microseismic monitoring (as delivered by MicroSeismic Inc.) into their exploration and development workflows in 2016. This case study will focus on validating reservoir simulation results from microseismic monitoring to determine vertical wellbore spacing for a large independent operator.

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