Maintaining Oil Production from Marginal Fields: A Review of the Department of Energy's Reservoir Class Program (1996)

The Reservoir Class Field Demonstration Program ¹ of the U.S. Department of Energy’s (DOE) Office of Fossil Energy is designed to contribute to the sustainability of domestic production by decreasing the rate of abandonment of marginal oil wells and fields. The specific objective of the program is to encourage the application of a broad range of conventional and advanced recovery technologies to the geologic classes of reservoirs that contain most of the known unrecovered oil. It is an industry-driven program that depends on no more than 50-percent funding from DOE. The Reservoir Class Program involves a diverse group of participants that includes independent oil and gas producers, small and major petroleum companies, state geological surveys, and universities.

The National Research Council formed the Panel on the Review of the Oil Recovery Demonstration Program of the Department of Energy in response to a request by DOE to assess the effectiveness of the Reservoir Class Program and to recommend improvements. The panel was charged with addressing the following two questions:

1. Has the Reservoir Class Program proven effective in demonstrating the application of new and existing technologies to prolong production in marginal fields?

2. How should this program be modified to improve its effectiveness in meeting this goal?

Because the field demonstration phases of most projects have not been in place long enough to be expected to produce significant increases in production, the panel’s conclusions and recommendations are based on a review of program procedures and individual project purpose, design, and progress. The panel concluded that the Reservoir Class Program is demonstrating advanced and conventional technologies that have the potential to prolong the lives of marginal oil fields.

Most projects in the Reservoir Class Program have an up-front reservoir characterization element that is intended to provide geologic and engineering parameters that will increase the effectiveness of the recovery technology being applied and help to define reservoir characteristics that will guide future applications. The emphasis on this program element varies considerably among the projects. The panel concluded that appropriate reservoir characterization is essential to the success of the program and that reservoir class is justified as the basis for organizing the program and for guiding the application of successful technologies. The panel concluded that in future phases of the program, DOE should encourage a larger number of proposals by opening up future proposal solicitations to meritorious projects from previously funded reservoir classes. This would also provide increased opportunities for application of cross-cutting technologies.

The process of selection and review of projects for the Reservoir Class Program originally was conducted by in-house DOE professionals supplemented by people with suitable expertise from other federal agencies. Concerns about the length and complexity of the proposal review, project selection, and contract negotiation process, however, led DOE to take actions to streamline the selection and contract negotiation process. The panel agreed that these changes would have the intended effect on procedures, but the panel was concerned that it would further limit the breadth of proposal and project review by qualified geoscientists and engineers. The panel also concluded that monitoring of progress and review of project results by recognized external peers is essential, and would improve the quality and acceptance of project outcomes.

Effective technology transfer is essential to the success of the program. Review of the technology transfer elements of several projects led to the conclusion that there is an over-reliance on loosely defined programs composed of standard communication techniques such as papers at technical meetings and workshops. Organizations geared toward technology transfer,

such as state geological surveys and the Petroleum Technology Transfer Council, generally have more clearly defined technology transfer programs than companies that are not traditionally in the business of sharing their successes with competitors. The panel concluded that DOE should take overall responsibility for technology transfer and that it should develop a comprehensive technology transfer plan that integrates plans and activities of individual projects, participating organizations, contractors, and interested field operators. Technology transfer program design also should include input from professionals in the area of public relations and communications.

The panel concluded that the Reservoir Class Program was applying appropriate conventional and advanced technologies to classes of reservoirs that could contribute significant continued production if these technologies prove to be successful in economically recovering oil and if they prove to be broadly applicable. The program contains the necessary elements for success and the target audience is the appropriate one. The program could be improved by implementing these recommendations:

• continue to use reservoir class as a basis for organizing the program; however, future proposal solicitations should be open to meritorious projects from previously funded reservoir classes as well as the targeted class;

• create a system of external peer review for proposal selection, monitoring, and post-mortem evaluation of the projects;

• shift responsibility for technology transfer to DOE and create a master plan to ensure that the intended audience is reached and that no results are disseminated without proper external peer review.