Mixed Deck — All SPE Topics Flashcards

An oil and gas project requires an initial investment of $50 million. The sum of its discounted future net cash flows is calculated to be $65 million using the company's required rate of return. What is the Net Present Value (NPV) of this project, and what does it signify?

Answer: NPV = $15 million; the project is economically acceptable.

Net Present Value (NPV) is calculated as the present value of future cash inflows minus the initial investment. In this case, NPV = $65 million - $50 million = $15 million. A positive NPV indicates that the project is expected to generate a return greater than the company's required rate of return, thereby adding value to the company and making it economically acceptable.

Under OSHA's Process Safety Management (PSM) standard 29 CFR 1910.119, what is the threshold quantity for flammable liquids and gases that triggers PSM applicability?

Answer: 10,000 lbs

OSHA PSM triggers for flammable liquids/gases at or above 10,000 lbs when stored above their flashpoint.

What is 'lost circulation' in drilling and what material is commonly used to combat it?

Answer: Loss of whole mud to the formation through fractures or vugs; combated with lost circulation materials (LCM) such as nut shells or fiber

Lost circulation occurs when drilling fluid flows into highly permeable, fractured, or vugular formations; LCMs plug the loss zones to restore returns.

What is the significance of the 'Dykstra-Parsons coefficient' (VDP) in reservoir characterization?

Answer: It quantifies vertical permeability heterogeneity; values near 1.0 indicate highly heterogeneous reservoirs

VDP ranges from 0 (homogeneous) to 1 (infinitely heterogeneous) and is derived from the log-normal permeability distribution of core plug data.

In a three-phase separator, what force is primarily responsible for separating water from oil?

Answer: Gravitational settling due to density difference

Water separates from oil in a three-phase separator mainly by gravity as the denser water phase settles to the bottom.

A production platform detects a H2S concentration of 10 ppm in the work area. According to OSHA guidelines, what action is required at this concentration?

Answer: Workers must be warned and exposure monitored — this is the ceiling limit

OSHA's ceiling limit for H2S is 20 ppm (with a 50 ppm peak for 10 minutes), and 10 ppm is the NIOSH recommended exposure limit requiring monitoring and warning.

What does 'swabbing' refer to in well operations and what hazard does it create?

Answer: Pulling the drillstring or tubing too fast, reducing annular pressure below formation pressure and potentially inducing a kick

Swabbing occurs when upward pipe movement creates a piston effect that temporarily reduces hydrostatic pressure, potentially pulling formation fluids into the wellbore.

In an interference test between two wells, what is the primary information obtained that a single-well buildup or drawdown test cannot provide directly?

Answer: Interwell permeability and porosity-compressibility product between the two wells

An interference test measures the pressure response at an observation well due to production at an active well, yielding interwell (large-scale) permeability and the φct product between the two wells.

Which type of drill bit is most suitable for drilling hard, abrasive formations such as quartzite or chert?

Answer: Diamond impregnated bit

Diamond impregnated bits use diamonds embedded throughout the bit body matrix, providing superior abrasion resistance for very hard, abrasive formations.

In multiphase flow through tubing, which flow regime typically results in the highest pressure drop per unit length?

Answer: Slug flow

Slug flow produces large, intermittent liquid slugs that cause significant pressure fluctuations and generally the highest average pressure gradient in vertical tubing.

A facility's SPCC Plan must be prepared or certified by a Professional Engineer when its aboveground oil storage capacity exceeds which threshold?

Answer: Over 1,320 gallons in a single container or over 660 gallons if a container could discharge to navigable waters

PE certification is required when a single aboveground container exceeds 1,320 gallons or the total exceeds 1,320 gallons and could reach navigable waters; facilities below certain thresholds may self-certify.

What diagnostic tool is used to measure downhole ESP performance parameters such as intake pressure, temperature, and vibration in real time?

Answer: Downhole monitoring gauge (DHG) or permanent downhole gauge (PDG) integrated with the ESP

Downhole monitoring gauges (DHGs) are installed as part of the ESP string to transmit real-time pressure, temperature, and vibration data to surface via the power cable.

A log analyst is evaluating a potential pay zone and needs to determine the lithology with high confidence, especially in a zone suspected to contain gas. Which logging measurement is least affected by the presence of gas and provides a strong indication of mineralogy?

Answer: Photoelectric Factor (Pe)

The Photoelectric Factor (Pe) is a measurement of the absorption of low-energy gamma rays and is primarily dependent on the average atomic number of the formation matrix. This makes it an excellent lithology indicator. Unlike density and neutron logs, which are significantly affected by the low density and low hydrogen index of gas (the 'gas effect'), the Pe measurement is relatively insensitive to the type of fluid in the pore space.

Which rheological model best describes drilling muds that exhibit both viscosity and gel strength?

Answer: Bingham plastic model

The Bingham plastic model characterizes fluids with a yield stress (gel strength) that must be exceeded before flow begins, plus a linear viscosity relationship.

In a density-neutron crossplot, a gas crossover occurs when:

Answer: Density porosity exceeds neutron porosity

Gas crossover occurs when density porosity reads higher than neutron porosity due to gas having low density and low hydrogen index simultaneously.

What is the purpose of 'reaming' while running casing to bottom?

Answer: Work the casing past tight spots or ledges in the borehole by rotating and reciprocating

Reaming involves rotating and reciprocating the casing string to break down tight spots or bridges that resist casing advancement to bottom.

Which method uses the relationship between capillary pressure and fluid saturation to estimate reservoir rock quality and pore structure?

Answer: Mercury injection capillary pressure (MICP) analysis

MICP forces mercury into core plugs at increasing pressures, revealing pore throat size distribution and capillary entry pressures.

What is the goal of reservoir management in oil fields?

Answer: Maximize recovery and extend reservoir life

The primary goal of reservoir management is to strategically plan and execute operations to maximize the ultimate recovery of hydrocarbons from a reservoir. This involves optimizing production rates, implementing enhanced recovery techniques, and making informed decisions to extend the economic life of the field. Effective management ensures the long-term profitability and sustainability of oil and gas assets.

In underbalanced perforating, what is the main advantage over overbalanced perforating?

Answer: Immediate backflow cleans perforation tunnels and reduces skin damage

Underbalanced conditions cause formation fluids to flow back through perforations immediately, cleaning crushed-zone debris and reducing damage skin.

How does the presence of a gas cap affect oil recovery?

Answer: It provides pressure aiding oil recovery

A gas cap is a layer of free gas overlying the oil zone in a reservoir. Its presence provides a natural pressure drive mechanism; as oil is produced, the gas cap expands, pushing the oil towards the production wells. This natural energy helps maintain reservoir pressure and significantly aids in the recovery of oil.