BRISBANE, Australia -- Hydraulic stimulation crews and rigs capable of drilling long horizontal laterals are beginning to trickle into Australia. The country is edging into the shale gas and tight sand formations very slowly compared to North America.

“There’s a lot of good learning that is coming out of America that we can take forward,” said Andrew Buffin, reservoir development manager, Baker Hughes, and a native Australian. “Our geology is not the American geology. There are subtle differences. We’ve heard it several times that shales are as different and diverse as any traditional, conventional reservoirs.”

Buffin participated in a technology roundtable at Hart Energy’s DUG Australia conference in Brisbane, Australia, on Aug. 28. He joined a discussion of “Best Practices in Resource-Play Drilling and Completions” with Billy Ray Smith, senior business development manager, Australia, Halliburton Co., and Kip Ferguson, executive vice president of exploration, Magnum Hunter Resources Corp.

Using Geology Intelligently

Buffin pointed out that Australian operators have to be a little bit wary and a little bit clever when it comes to applying North American technology to Australian geology. “It’s more important to look at the geology rather than just complete the wells based on geometrics. We have to go in there and start working geologically. We’re trying to identify the sweet spots from the petrophysics and geomechanics,” he said.

“We have to be a little bit more precise and intelligent by way of finding the sweet spots rather than just going in with brute force. Most people in Australia are in the stage of understanding in a vertical sense the rock strata. We’re just starting to go into horizontal wells so that we can form how we frac it, which direction the frac is going to be heading off in, and how it is going to be contained. We’re in the early stage.”

Companies going through exploration and appraisal have to be able to relate cores to the logs and 3-D seismic and to do seismic attribution analysis to identify the sweet spots. “Bring all the geology into one unique work flow. Then you can complete wells in an intelligent manner that is going to get you high productivity,” Buffin added.

Using U.S. Expertise

Data are key to designing the technology for the wells, whether, for example, sliding sleeves or plug and perf completions are better. However, Australia has a dearth of data.

“It is going to be more of a challenge when you’re talking about Australia. You just don’t have the well count,” Smith said. “You need to build dynamic geomodels. In the U.S., especially in the Eagle Ford, we have the well count and a lot of good data. The dynamic model is going to be a lot easier to build in the U.S. than in Australia.”

Ferguson explained that an operator doesn’t want to leave anything behind. Efficiencies are gained in horizontal wells by staying in the zone and on target. “Our window is driven by geological and petrochemical models. To stay in the zone, you actually have to slow down to drill. We spend a lot of time geosteering our wells. In most cases, a successful well is based on how you steer that well.”

Partnership, Risk-Sharing Are Keys

There is a shortage of good frac sand in Australia, Buffin said. The other problem is water -- either too much when it is flooding or too little when it is dry. “There’s not enough water and not enough proppant. Here in Australia, it is a big resource problem. Going forward, it’s a problem we have to get around.”

Infrastructure is also a problem. Risk-sharing and finding a different approach to working with service companies so that there is an attitude of alliance, rather than just using service companies as providers, is essential. “Without coming together, core information, or risk-sharing, the industry is going to face a big hurdle for the unconventional shale gas industry to take off,” Buffin continued.

“Potentially, a big tidal wave is waiting to sweep through. That won’t happen with alliance,” he emphasized.

In North America, it is all about competition. There seems to be a lot of competition and knowledge-sharing, Ferguson said. “In the Cooper basin, there are so few operators. The Cooper basin is a huge area compared to the U.S., and there are four or five operators that control the vast majority of the acreage. You really need to have the service companies be part of the company and development.”

A significant number of operators is needed to drive competition. “There is going to be a hurdle in the Cooper basin to accelerate drilling and unconventional completions,” he added.

Smith explained that operators will need to be flexible with schedules to more efficiently work with the service companies. Completion and evaluation are going to be a challenge in Australia until the rig count rises.

“There’s not a lot of wells being drilled. There is a tendency to want to drill one well, complete it one way; then drill another well and change the whole way you did. When you do that, you don’t know exactly what happened from one well to another. I think that is a challenge we will face in Australia,” he continued.