Optimization of Well Placement Under Time-Dependent Uncertainty

Summary Well-placement decisions made during the early stages of exploration and development activities have the capability to improve later placement decisions by providing more information (greater certainty). Therefore, recovery and efficient use of information may add value beyond the amount of oil recovered. This study proposes an approach that emphasizes the value of time-dependent information to achieve better decisions in terms of reduced uncertainty and increased probable net present value (NPV). Unlike previous approaches, well-placement optimization is coupled with recursive probabilistic history-matching steps through the use of the pseudohistory concept. The pseudohistory is defined as the probable (future) response of the reservoir that is generated by a probabilistic forecasting model. To test the results of the proposed approach, an example reservoir was investigated with multiple realizations, all of which match the same production history. The results of this study showed that subsequent well-placement decisions can be improved when probabilistic production profiles obtained from the wells, as they are drilled, are incorporated in the optimization scheme.