Well Cost Analysis And Prediction Of Shale Gas In Sichuan Area

Shale gas is a kind of natural gas resource with great potentials.China has made significant progress in shale gas development in the past decade.However,the shale gas production in China is severely limited by its costs.The well costs have been cut by almost 50%,but the economic benefits are still less satisfactory.This situation restricts the expansion of shale gas development activities and the growth of shale gas production.Compared with the United States,China suffers from higher well costs for shale gas development,and thus has a huge potential for cost reduction.In the early stage of shale gas development,a cost analysis for global shale gas development activities can be conducted to reveal the cost variation,set the cost-control targets,and identify the key factors for costs,so that appropriate measures can be taken to lower the costs and enhance the production.Moreover,the practices in the United States show that the costs decrease over time as the workloads increase.This rule is known as the learning curve theory.Accordingly,it is possible to clarify the patterns in shale gas development in order to predict relevant costs as a reference for investment decision-making and planning.This paper presents an analysis on the well costs for shale gas development using the massive real data of gas fields acquired from active operators and service companies in Sichuan Basin.Key factors for costs are identified by studying cost components and comparative analysis,together with other statistical techniques(e.g.correlation analysis)and technical indicators.Based on the learning curve theory,the well costs for shale gas development in China and other countries are discussed and a model is built to predict the costs in the future.Finally,recommendations for cost control and efficiency enhancement are proposed for shale gas development with regard to management reform,technical measures and policy supports.