A CASE STUDY: Drilling in highly fractured areas

How to avoid fluid losses that slow drilling

Halliburton’s expertise in underbalanced drilling will be the key to making

development in Kurdistan more economical and creating more local jobs
OVERVIEW
As a result of the highly fractured geology in Kurdistan,
operators encounter constant fluid and cement losses.
Many report that wells expected to take three to four
months to drill actually take nine to twelve.

Normal approaches to drilling make fluid losses worse by

putting additional pressure on formations. That can lead
to even more fractures. The additional pressure can also
slow the rate of penetration and reduce field production.

Halliburton helped pioneer underbalanced drilling and

is a world leader in delivering products and services
that make it possible. Less pressure on formations helps
reduce fractures, widen the ECD window, increase ROP,
optimize casing design, and reduce skin damage effect
on the formation. It can improve production and reduce
costs, making oil and gas extraction more economical
and creating more local jobs.

CHALLENGE
Fluid loss
This mountainous region contains a complex network of
natural fractures. Many operators encounter frequent fluid
loss due to this highly fractured geology. Drilling can put
additional pressure on formations, causing even more loss.
Operators need a way to minimize fluid loss and drilling time.
SOLUTION
,
Underbalanced drilling
Halliburton is a world leader in underbalanced drilling.
Various Halliburton groups offer underbalanced drilling
equipment, fluids, services and foamed cements. Halliburton
underbalanced solutions can help complete projects more
quickly and safely while enhancing reservoir performance.

Development of local skills and economy
Kurdistan is growing quickly. But sustaining that growth
will require a well-developed oil and gas industry that can
sustain itself. The government wants to work with
companies willing to train local employees, create
local infrastructure and share their knowledge.
Knowledge transfer and sustainable development
Worldwide, 92 percent of Halliburton’s employees are hired
from local populations where the company operates. The
Halliburton workforce development program trains them in
their home regions. Halliburton also mentors local suppliers
and builds sustainable, local-sourcing partnerships.

Rapid start-up Local presence and logistical support

Many operators in Kurdistan need equipment and crews
quickly to meet contract requirements. Areas without a robust
oilfield infrastructure can experience logistical delays. A
shortage of trained suppliers can even force
operators to work with people who compromise results.
Boots & Coots, a Halliburton service, already operates in
Kurdistan. So does Halliburton Completion Tools, Cementing
and Drill Bits & Services. Seven more service lines will join
them by 1Q13. Halliburton also has a large presence in Iraq
and can support Kurdish operations quickly if needed.
 50%
A CASE STUDY: Drilling in highly fractured areas

DRILLIN
TIME G
REDUCED
BY
In the Bermudez region of Mexico, Halliburton
used managed pressure drilling to reduce drilling
time by approximately 50 percent compared to
other recently drilled wells in the same fields.

50%
In Thailand, Halliburton used underbalanced
drilling in an area with extensive natural
fracturing. After two days of drilling the
Drilling timeindex
production reduced
increasedby 50%
from 10 Mscfd/

11K
psi to approximately 30 Mscfd/psi.

bbl/day
3500
bbl/day

Halliburton used its GeoBalance® Optimized Pressure

Drilling service in Southern Mexico to drill a well with a
naturally fractured formation notorious for kick and lost
circulation. The well produced 11,000 barrels of oil (bbl) per
day compared to the field average of 3,500 bbl per day.

92% LOCAL
Currently more than 92 percent of the Halliburton
workforce worldwide is localized. Halliburton is
committed to local employment and the transfer of
knowledge through hiring and education programs.

EMPLOYMENT
A CASE STUDY: Drilling in highly fractured areas

Halliburton’s expertise in underbalanced drilling will be the key to making

development in Kurdistan more economical and creating more local jobs

Extreme fluid losses in highly fractured formations

Fluid losses due to the naturally fractured formations in Kurdistan have
hampered exploration. Many wells expected to be drilled in three to four months
are actually taking nine to twelve months. Operators need a way to stop these
fluid losses, increase rate of penetration and decrease drilling time.

Many Halliburton services specialize in preventing fluid loss

Halliburton is a pioneer in underbalanced drilling and provides specialized
services and equipment that can help solve fluid loss. In difficult drilling
situations, Halliburton’s GeoBalance Managed Pressure Drilling Service provides
drilling optimization and minimizes reservoir damage.

Baroid Fluid Services, another Halliburton service, provides drilling and reservoir
fluid solutions along with fluid additives to help prevent fluid loss and enhance
productivity. Baroid also provides waste management solutions and solids
control equipment customized to maximize drilling efficiency.

Halliburton has also developed lightweight and foamed cements that deal
specifically with fluid loss. Halliburton currently conducts more than 800
cementing jobs monthly in the region and recently developed a new system
specifically designed for the types of fluid losses found in the Middle East.

GeoBalance® Service increased production in Mexico

An operator required a managed pressure drilling operation performed in one
of the highest producing oil fields in South Mexico. The well was in an area with
a naturally fractured formation. Halliburton recommended using its GeoBalance
Managed Pressure Drilling Service, saving the customer one day of rig time, but
the larger benefit was in production. The well produced at a rate of 11,000 bbl
per day compared to the field average of 3,500 bbl per day.

Underbalanced drilling lead to major gas discovery in Thailand

In Northern Thailand, an operator using conventional drilling in an area with
extensive fractures experienced loss of hydrostatic head and a gas kick at the
surface. Halliburton used underbalanced drilling to overcome lost circulation and
safely maintain pressure control. In the first two days of drilling, the production
index increased from 10 Mscfd/psi to 30 Mscfd/psi, and the operator discovered
additional major gas reserves.

Foamed cement increased profitability of wells

An operator in the Canatrell fields, one of the largest fields in Mexico, needed
a light-weight cement to decrease the cost of drilling and improve production.
Traditionally, the lower limit for cementing has been 7.5 to 8.5 pounds per gallon.
However, these slurries were not light enough. Halliburton used an ultra-light
foamed cementing technology to produce successful circulation and an effective
seal. The use of this foamed cement slurry delivered downhole densities as low
as 5 pounds per gallon, decreasing costs and increasing production.
A CASE STUDY: Drilling in highly fractured areas

Halliburton’s expertise in underbalanced drilling will be the key to making

development in Kurdistan more economical and creating more local jobs

Drilling time cut in half with managed pressure drilling

An operator in the Bermudez region of Mexico used conventional drilling
fluids in an underpressured, fractured field. Drilling resulted in lost circulation
and associated problems with differential sticking and poor hole cleaning.
Halliburton used managed pressured drilling to address these challenges,
reducing drilling time by approximately 50 percent compared to other recently
drilled wells in these fields.

Development of local economy and workforce

Operators in Kurdistan are dedicated to improving the country’s economy and
infrastructure. The government wants companies who will help improve the long-
term economy by hiring and training local people, and developing local suppliers.

Halliburton commitment to local employment and knowledge transfer

Currently more than 92 percent of the Halliburton workforce worldwide is
local. Halliburton transfers knowledge through hiring practices and education
programs. Halliburton mentors local suppliers and builds sustainable-sourcing
partnerships through its Supplier Diversity Program. Halliburton training centers
located around the world provide structured training for every stage of an
employees’ career.

Increased investment in Brazil with Halliburton Technology Center

One example of Halliburton’s commitment to local employment and the transfer
of knowledge is in Brazil. Halliburton invested more than $200 million dollars
in three years in the country, building facilities and a technology center to train
local workers. 96 percent of the 1,800 Halliburton employees in Brazil are local.
With the new technology center, that number could grow.

Logistical excellence in start-up operations

Some operators in Kurdistan need companies that can begin operations within
weeks of contract award. Halliburton already has an established a presence
in Kurdistan. Boots & Coots has two offices and a warehouse to keep stock
available for fast delivery. It also has engineers on the ground and can be on a
rig anywhere within 24 hours notice. Halliburton is already the main supplier
of drill bits for several operators in the country. Halliburton also has a strong
presence in Southern Iraq and can quickly transport crews and equipment to
meet customer needs in Kurdistan.

Halliburton presence continues to grow in Kurdistan

Halliburton services and products will continue to flow into the country over the
course of the next year. By the end of 2012, Halliburton will have motor, drilling
tools and SDL units in Kurdistan. Baroid Drilling Fluids, a Halliburton service, will
have a team to support full operation in the country by the start of 2013. Baroid
has a fully functional lab in Kurdistan and is already working in the region. Most
Baroid fluid products are already in Kurdistan, with additional specialty products
and equipment available nearby. By the first quarter of 2013, virtually every
Halliburton product service line should have a presence in Kurdistan.
 A CASE STUDY: Drilling in highly fractured areas

Halliburton’s expertise in underbalanced drilling will be the key to making

development in Kurdistan more economical and creating more local jobs

Papers showing Halliburton thought leadership in preventing fluid loss:

Offshore Automated Managed Pressure Drilling in Fractured Basement Granite Reservoir: Case Study, Challenges and Solutions
www.onepetro.org/mslib/app/Preview.do?paperNumber=SPE-130318-MS&societyCode=SPE

Comparison of Under-balanced and Managed-Pressure Drilling Techniques

www.aade.org/TechPapers/2007Papers/Web/Managed_Pressure_Drilling/AADE-07-NTCE-39.pdf

Maximizing Reservoir Potential Using Enhanced Analytical Techniques with Underbalanced Drilling
www.onepetro.org/mslib/app/Preview.do?paperNumber=00090196&societyCode=SPE

New Ultra-Lightweight Cementing Technology Proven with Case Studies, Combines Benefits of Current Leading Methodologies
www.onepetro.org/mslib/app/Preview.do?paperNumber=SPE-92970-MS&societyCode=SPE

Foamed Cement vs. Conventional Cement for Zonal Isolation – Case Histories
www.onepetro.org/mslib/app/Preview.do?paperNumber=00062895&societyCode=SPE

Successful Liner Application Using Foamed Cementing Technology for Low-Pressure, Naturally Fractured Formations
www.onepetro.org/mslib/app/Preview.do?paperNumber=00069489&societyCode=SPE

Offshore Automated Managed Pressure Drilling in Fractured Basement Granite Reservoir:

Case Study, Challenges and Solutions
www.onepetro.org/mslib/app/Preview.do?paperNumber=SPE-130318-MS&societyCode=SPE

Underbalanced Drilling Of Fractured Carbonates In Northern Thailand Overcomes

Conventional Drilling Problems Leading To A Major Gas Discovery
www.onepetro.org/mslib/app/Preview.do?paperNumber=00090185&societyCode=SPE

Comparison of Under-balanced and Managed-Pressure Drilling Techniques

www.aade.org/TechPapers/2007Papers/Web/Managed_Pressure_Drilling/AADE-07-NTCE-39.pdf

Maximizing Reservoir Potential Using Enhanced Analytical Techniques with Underbalanced Drilling
www.onepetro.org/mslib/app/Preview.do?paperNumber=00090196&societyCode=SPE

Innovative MPD Techniques Improve Drilling Success in Mexico

www.onepetro.org/mslib/app/Preview.do?paperNumber=SPE-104030-MS&societyCode=SPE

New Ultra-Lightweight Cementing Technology Proven with Case Studies,

Combines Benefits of Current Leading Methodologies
www.onepetro.org/mslib/app/Preview.do?paperNumber=SPE-92970-MS&societyCode=SPE

Cementing Technologies for Low Fracture Gradient and Controlling Loss Circulation
www.onepetro.org/mslib/app/Preview.do?paperNumber=SPE-102074-MS&societyCode=SPE

Superior Zonal Isolation Provided by Ultralightweight Cementing Technology Increases Profitability of Wells
In Difficult-to-Cement Areas
www.onepetro.org/mslib/app/Preview.do?paperNumber=SPE-104066-MS&societyCode=SPE

New Binary LCM System Helped Cure Losses during Cementing while Minimizing Risk of Plugging for Slim Liners
www.onepetro.org/mslib/app/Preview.do?paperNumber=SPE-150712-MS&societyCode=SPE

SPE 62895 Foamed Cement vs. Conventional Cement for Zonal Isolation – Case Histories
www.onepetro.org/mslib/app/Preview.do?paperNumber=00062895&societyCode=SPE

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