Exponential Decline

Since b=0, Equation 1 can be re arranged as:

  -------------------------------------------------(2)
 Variables
o q = current production rate
o q i = initial production rate (start of production)
o d i = d = dt = nominal decline rate (a constant)
o t = cumulative time since start of production
o The most conservative and simplest equation of the decline curve family.
 Effective decline rate D remains constant over time.
 Log rate vs. time is a straight line on semi-log plot.
 Rate vs. cumulative is a straight line on a linear plot as shown below:

-------------------------------------(3)
Applies to a well producing at constant bottom hole pressure.
INSERT FIGURE 4 Rate vs. Time – Exponential Decline  (Pending permission approval)
INSERT FIGURE 5 Rate vs. Cum Oil – Exponential Decline (Pending permission approval)
Reservoir types with exponential declines [1]:

 Oil reservoirs
o Above the bubble point
o Down dip wells with gravity drainage
o Solution gas drive with unfavourable kg/ko
 Gas reservoirs
o High reservoir pressure (liquid-like compressibilities)
o Wells with liquid-loading problems
 Both oil and gas reservoirs
o Produced with small drawdown relative to reservoir pressure
o Tubing limited wells.
Back to top

Nominal and Effective decline

 There are two types of decline factors (often called the decline rate).
 The nominal decline factor d is defined as the negative slope of the curve representing
the natural logarithm of the production rate q vs. time t or :
  Nominal decline is a continuous function and it is the decline factor that is used in the
various mathematical equations relating to decline curve analysis. For exponential
decline it is a constant with time.
 The effective decline factor D is a stepwise function that is in better agreement with data
recording practices. It is the drop-in production rate from qi to q1 over a specific time
period.
 It is defined as

 D is the effective decline rate = the decline rate over a time period.
o This is the decline often quoted in e.g. commercial software decline graphs.
Such software may, at users discretion, report nominal decline.
o It is the proportion by which the production rate reduces over a given time
period.
o D is a constant only for constant percentage or exponential decline.
o D decreases with time for hyperbolic and harmonic decline
o (1> b > 0)
 It is easy to convert from a nominal decline factor to an effective decline factor and vice
versa.

 Thus an ‘effective’ decline of 10 % per year is equivalent to a nominal decline of 10.54%
per year and vice versa
INSERT Figure 6 Effective and Nominal Decline, Shape and Relationship  (Pending permission
approval)
Back to top

Hyperbolic Decline
Flowrate

 ------------------------------------------------------(4)
Cumulative production

  -----------------(5)
Variables

 q = current production rate

 q i = initial production rate (start of production)
 d i = initial nominal decline rate at t = 0
 t = cumulative time since start of production
 N p = cumulative production being analyzed
 b= hyperbolic decline constant (0 < b < 1)
 This is the most general formulation for decline curve analysis. Exponential (b=0) and
harmonic (b=1) decline are special cases of this formula.
Back to top
Three constants
The mathematical equation defining hyperbolic decline has three constants

 The initial production rate

 The initial decline rate (defined at the same time as the initial production rate)
 The “hyperbolic exponent” b.
o For most conventional analysis, 0 <b <1
o However for some cases b > 1 has also been found.
Decline rate is not a constant
The decline rate is not a constant but changes with time, since the data plots as a curve on semi-log
paper
Back to top
Hyperbolic exponent
The hyperbolic exponent ( b) is the rate of change of the decline rate with respect to time. This
means that “b” is the second derivative of production rate with respect to time.

 -----------------------------------(6)
Hyperbolic decline constant
The hyperbolic decline constant at some future time, t, is defined by the following equation:

 High b exponents give small values of d, i.e. (= flat decline curves)—WATCH OUT!
 Unconstrained hyperbolic “curve fits” can severely overestimate future production
 Often useful (and safe) to use some value of minimum effective decline to avoid over-
flattening the curve (say 5 % per annum)
 Hyperbolic curve fits with a decline constant (b) greater than 1 usually imply production
is being influenced by transient behavior. For example b=2 corresponds to transient
 linear flow and is commonly found with unconventional reservoirs. However, be very
careful with these cases – you should build limits into your forecast to capture the
eventual transition from transient to boundary dominated flow.
Back to top
Definition of b
The term ‘b’ has no units and is normally known as hyperbolic constant. Generally ‘b’ can range in
value from 0 to 1 in the context of DCA for oil and gas wells. It is evident from Eq 1 that a large value
of b ( close to 1) has a dominant effect on shape of the curve q vs. t as t becomes large. This causes
and maintains the shape of the curve during this time to be essentially flat. For a given set of values
for q and b the short term shape for the curve is not largely effected by the value of b but the long
terms shape is. This implies that in short term all decline curves; exponential, hyperbolic and
harmonic give similar results. However due the very same reasons make it extremely difficult to
determine the value of b. The problem is aggravated if the data is noisy ( which is often the case)
making it possible to fit a wide range of b values to the same dataset. However since the value of b
has large impact in the late time, it will lead to different estimates of EUR. Reliability in estimation of
b increases with maturity of production data. The value of b captures a large number of physical
events and processes. A large body of publications are dedicated to this topic.
Minimum decline

 Need to use some value of minimum decline slope to avoid over-flattening of curve
o Convert to exponential decline when dt< dmin
o Dmin obtained from most mature wells in the field, analogous fields of
“experience”
 Forecast of ultimate recovery should give a reasonable recovery factor based on
estimated volumes of hydrocarbons in place.
INSERT Figure 7 Application of minimum decline concept  (Pending permission approval)
Back to top
Harmonic decline

 Flowrate

 Cumulative production
  Variables
o q = current production rate
o q i = initial production rate (start of production)
o d i = initial nominal decline rate at t = 0
o t = cumulative time since start of production
o N p = cumulative production being analyzed
o A simple formula – often the most optimistic case
 Plot of log rate vs. cumulative production is a straight line on semi-log plot
Back to top

Determining the type of decline

Based on what has been covered so far, the engineer performing a DCA analysis needs to be aware
of the following:

1. The most representative period in history that will also represent future.
2. The decline trend during that period.
3. The start point(rate) of forecast .
4. The constraints under which the forecast needs to be made.

However one more factor, also extremely important at this stage is to determine type of decline.
Since the signature of shape may not be apparent on a log q vs. time (most used plot), literature
provides many ways was to look at the same data, combine this information with other knowledge
about the fields before we make our conclusions. .
As shown in Figures 8 to 11 Shapes of curves for the same data plotted in different ways helps
determine the type of declines.  (Pending permission approval)
INSERT Figure 8: Rate vs. Cum Oil - Cartesian Axes – Exponential decline is a straight line  (Pending
permission approval)
INSERT Figure 9: Log Rate vs. Cum Oil - Semilog – Harmonic decline is a straight line  (Pending
permission approval)
INSERT Figure 10: Rate vs. Time - Cartesian Axes (Pending permission approval)
INSERT Figure 11: Log Rate vs. Time - Semilog – Exponential decline is a straight line  (Pending
permission approval)
Back to top

Decline curves for reserve estimates

A major use of decline curve analysis is made in estimation of reserves. Even for the assets where
history matched simulation models are available, a cross check with DCA is normally made to give
increased confidence in numbers.
The fact that DCA does not have a theoretical basis is an asset here since financial institutions are
more acceptable to DCA estimates than other more technical methodologies. A major difference
when applying DCA for estimation of reserves arises understandably due the very nature of
definitions of reserves and financial implications associated with the process. The ultimate recovery
numbers become more important than the profiles. Application of constraints in the production
system, operating costs, capital costs and well behavior itself all need to be put into right perspective
to come up with reliable estimations.
An in-depth description of application of DCA to reserves estimation is outside the purview of this
guideline, however some typical situation and their treatment are discussed in section II of this
chapter.
While everything else remains same, estimation of reserves does come up with several typical
situations to which there are no ready answers. Some of these situations are listed out below for
reference. The solutions to these problems could vary from engineer to engineer or organization to
organization. Some of the best practices have however been compiled and can be found
in production forecasting principles and definition.

 What should be the start point of the forecast if rate changes significantly in last or last
few months.
 How to get a P10, P50, P90 estimate using decline curves.
Back to top

Using decline curves

Decline analysis and forecasts generated based on such analysis (whether production profiles or
reserves) should be fundamentally grounded in good understanding of the factors that control this
behavior. ‘No One size fits all ‘ this principal applies truly and universally when it comes to
application of DCA. Specifically always arbitrarily using an exponential decline approach for water
drive, solution gas drive and gravity drainage systems is neither technically not empirically justified.

DCA in waterflood and ratio plots

Field cases as well as analytical / simulation generally support hyperbolic/harmonic decline for late
stage waterflood behavior meaning that value of b lies 0<b<1. This is not to say that exponential
decline or super harmonic decline will/may not occur in waterflood reservoirs. However whenever
such phenomenon is observed, usually non reservoir factors are at play.
In order to estimate future waterflood performance we need to examine what is controlling the oil
decline rate. After substantial water breakthrough, the rate is usually controlled by

 Relative permeability
 Changing volumetric sweep
 Water handling constraints
 Fluid rates handling constraints
 Permeability injectivity in near wellbore regions
 Well positions.