Wyoming EORI 2nd Annual Wyoming CO2 Conference 5/29/08 The Beaver Creek Madison CO2 Project Spring 2008 Chuck Peterson Sr. Reservoir Engineering Advisor
Beaver Creek Madison CO 2 Flood Project Overview Geographic Setting Geologic and Reservoir setting Field History Final Project Design Project Construction NYSE: DVN www.devonenergy.com page 2
CO2 Floods in Wyoming Devon Beaver Creek Field Anadarko Salt Creek Field Merit Energy Anadarko Patrick Draw Monel Unit Wertz/Lost Soldier NYSE: DVN www.devonenergy.com page 3
Beaver Creek Madison Structure -6300 Reservoir Characteristics Porosity = 10% Permeability = 9 md Reservoir Temp = 234 o F BHPi = 5301 psia GORi = 288 scf/bbl Bubble Pt. = 673 psia Swi = 10% Oil Gravity = 39.5 o API 9 Approximate Oil - Water Contact 52-6200 45 69 Type Log 34 107 127-6100 42-6000 147 10-5900 14 77 41 68 57 30 46 11 39-M - 5800 104 56 Geologic Characteristics Limestone/Dolomite Matrix Approx. Prod. Area = 974 Acres Approx. Oil Column Height = 820 Avg. Net Pay Thickness = 212 Avg. Depth to Madison Top = 11,100 NYSE: DVN www.devonenergy.com page 4 16 44 55 Active Oil Producer - 58 0 0 Active Water Injector 31-5700 96 117 38 143 15 17 40 137 81-5 6 00 43 139 W 32 66-5700 146 124 136 22-5 9 00-6000 -6100 0 1,518 FEET
Beaver Creek Madison Structure 3D Seismic View Backthrust (Eastern Fault) Madison (HW) Main Block Madison (FW) Subthrust Beaver Creek Structure Viewed From the South NYSE: DVN www.devonenergy.com page 5
Madison Log Section (GR/Buld Density) A Zone Top B Zone Top C Zone Top D Zone Top BCU #127 Well Top @ 11224 MD Bottom @ 11723 MD E Zone Top F Zone Top Madison Base NYSE: DVN www.devonenergy.com page 6
Background & Evaluation History Madison reservoir discovered January 1954 Waterflood initiated in 1959 with peripheral flood Water injection expanded to pattern flood through 1964 - Reservoir developed with 36 completions Currently have 21 active wells including 12 producers and 9 injectors Current Production of 300 bopd, 29,000 bwpd & 13,000 bwipd CO 2 flood potential originally identified in Amoco s 1987 CO Feasibility 2 Study Determined marginally economic in 1987(low oil price) Identified additional data needs to mitigate risk Devon revived the project idea in January 2005 NYSE: DVN www.devonenergy.com page 7
Beaver Creek Madison Production History Beaver Creek Madison Unit Production History 100,000 Early waterflood 10,000 Monthly Volumes (Bpd, Mcfd) 1,000 Oil Gas Water WINJ 100 10 Main Block (Target) OOIP = 109 MMbo Cum Oil = 42.5 MMbo (39% OOIP) Rem = 2.6 MMbo NYSE: DVN Jan-50 Jan-60 www.devonenergy.com Jan-70 Jan-80 Jan-90page 8 Dec-99 Dec-09
Phased Evaluation Phase 3 - Final full field modeling and flood design Full field 3D compositional model History matching Identified where remaining oil exists Forecast Base (as is) forecast 4 Development pattern options Sensitivity analyses WAG cycles Surface facilities limitations Final Economic analysis NYSE: DVN www.devonenergy.com page 9
Phase 3 - Full Field 3D Compositional Model NYSE: DVN www.devonenergy.com page 10
Phase 3 Modeling Forecast Flood Design Options Plan 1: Peripheral CO 2 -WAG Plan 2: Pattern CO 2 -WAG Plan 3: Combined Plan 1 & Plan 2 Plan 4: Peripheral-Gravity drainage NYSE: DVN www.devonenergy.com page 11
Plan 1 Peripheral CO2-WAG 14 Injectors: 8 WAG injectors 6 CO2 injectors 17 Producers B 69 57 Low confidence inside this area 12 Shut-in or producing from other formation or TA Detail: 3 well conversion (prod->inj): 44, 146, 143 8 old producers: 11, 38, 41, 46, 68, 147, 66, 81 2 shut-in: 14, 96 6 old injectors: 40, 17, 30, 32, 45, 139 7 new producers: D, E, F, G, H, I, J, L 4 new injectors: A, B, C, K 1 Injector reactivation: 31 1 Producer reactivation: 77 us tive ctive ctor NYSE: DVN www.devonenergy.com page 12 45 44 55 L A 127 D 41 34 14 61 E H 96 68 I 143 J F 38 42 147 G 77 17 30 C 46 11 K 56 66 40 81 146 139 43 39 32 22
Plan 2 - Pattern CO2-WAG 18 Injectors: All WAG injectors 14 Producers Detail: 2 well conversion (prod->inj): 44, 146, 9 old producers: 11, 38, 41, 46, 68, 147, 66, 81, 143 8 old injectors: 40, 17, 30, 32, 45, 139, 14, 96 4 new producers: L, D, E, J 8 new injectors: A, B, K, H, F, G, I, C 1 Producer reactivation: 77 Remaining oil in place (rb/acre) 110,000 100,000 5250,000 NYSE: DVN www.devonenergy.com page 13 90,000 80,000 70,000 60,000 40,000 30,000 20,000 10,000 0 Well status Black = active Red = Inactive Blue = injector 45 44 A L 55 D 127 41 34 E H 14 61 B 96 J I68 143 F 38 G 42 147 69 77 17 30 40 46 11 81 57 Low confidence inside this area C K 139 43 56 WG 66 146 39 32 22
Flood Preparation Work Requirements Convert 2 wells from producer to injector Rework or recomplete 9 producers & 7 injectors Drill 7 new producers & 5 new injectors Construct Production & Injection Facilities Install New Flowlines for Producers & Injectors Build CO2 Supply Pipeline NYSE: DVN www.devonenergy.com page 14
Beaver Creek Madison CO 2 Flood Where Are We At Today? Construction & Wellwork Initiation Infrastructure Work Under Way May 2007 Drilling Program Initiated July 2007 Flowline Construction February 2008 Facilities Construction underway Progress to Date Drilling program 7 Wells D&C, 3 Drilled, 2 WO Rig Rework/recompletion 95% complete CO 2 gas contract in place CO 2 pipeline construction 100 % Completed 75% hydro-tested Distribution and flow lines installation complete Compressors & Dehydrator Fabricated and Ready for Delivery Process Vessels Set Piping in Progress July 2008 Project Startup NYSE: DVN www.devonenergy.com page 15
Drilling Operations In Progress NYSE: DVN www.devonenergy.com page 16
Nabors Rig M-40 NYSE: DVN www.devonenergy.com page 17
State of the Art Rig Controls NYSE: DVN www.devonenergy.com page 18
Driller s View NYSE: DVN www.devonenergy.com page 19
Automated Pipe Racks NYSE: DVN www.devonenergy.com page 20
Flex Mud Lines to Accommodate Walking Rig NYSE: DVN www.devonenergy.com page 21
Mud Pit NYSE: DVN www.devonenergy.com page 22
CO 2 Delivery Line ROW Terrain CO2 Line coming off Beaver Rim 8 inch CO2 Line NYSE: DVN www.devonenergy.com page 23
Recycle Compressor Fabrication NYSE: DVN www.devonenergy.com page 24
Intermediate Pressure Compressor Skid NYSE: DVN www.devonenergy.com page 25
Madison Well #66 Production Line- 1st ditch dug Kevin Watson (L) and Bill Skelton (R) NYSE: DVN www.devonenergy.com page 26
Carbon Steel Production Line Pipe NYSE: DVN www.devonenergy.com page 27
High Volume Gas Gathering Lines 6 Sweet Gas Line From Riverton Dome 10 Low Pressure Line: Beaver Creek Sweet NYSE: DVN www.devonenergy.com page 28
Production Header Leveling Up Production Lines NYSE: DVN www.devonenergy.com page 29
Production Header NYSE: DVN www.devonenergy.com page 30
Injection Header Building Construction NYSE: DVN www.devonenergy.com page 31
Oil Tanks / Compressor Foundations / Cooler Foundations NYSE: DVN www.devonenergy.com page 32
Thank You.