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AAPG Bulletin

Abstract

AAPG Bulletin, V. 92, No. 10 (October 2008), P. 1393-1402.

Copyright copy2008. The American Association of Petroleum Geologists. All rights reserved.

DOI:10.1306/06040808071

Using the value of information to determine optimal Previous HitwellNext Hit order in a sequential Previous HitdrillingNext Hit program

Peter Cunningham,1 Steve Begg2

1Decisions Unlimited, Balmuir, Aberdeen Road, Tarland, Aberdeen AB34 4UA, United Kingdom; [email protected]
2Australian School of Petroleum, University of Adelaide, SA 5005, Australia

ABSTRACT

Offshore Previous HitdrillingNext Hit programs on complex reservoirs carry inherent risks. Subsurface uncertainty can lead to costly mistakes being made, and, therefore, being able to gain information during the course of a sequential Previous HitdrillingNext Hit program, and use it effectively, can have sizeable capital importance. Based only on predicted Previous HitdrillingNext Hit costs and production rates, wells closest to the platform would commonly be drilled before longer offset wells by virtue of their cheaper Previous HitdrillingNext Hit costs. However, there is potential during the Previous HitdrillingNext Hit program for learning to occur between the Previous HitdrillingNext Hit of two wells that would either provide encouragement to go ahead and drill the second Previous HitwellNext Hit, change it in some way, or, indeed, remove it from the program altogether. Analyzing the predicted value of this learning, before Previous HitdrillingNext Hit commences, can reveal the conditions under which the longer offset Previous HitwellNext Hit could be drilled first because of its potential to impact decisions regarding the second Previous HitwellNext Hit. The various scenarios and their sensitivities are analyzed using a value of information (VoI) approach, providing an example of how VoI can be used proactively in the construction of learning Previous HitdrillingTop strategies. The same approach can be extended to most other data acquisition situations.

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