Fekete announces the long anticipated release of F.A.S.T. RTA™ version 3.0. This upgrade contains a variety of new features designed to enhance interpretation, modeling, and reporting of your production performance analysis.

New Features

• New Models - Multi-Phase (Numerical) - Composite - Multi-Layer - Dual Porosity - Geomechanical• Enhanced Flowing Material Balance• Advanced Properties Section• Enhanced Results Visualization and Mapping• Enhanced Reporting / Printing Capabilities

New Models

An extensive portion of our upgrade is devoted to new and enhanced modeling capabilities.

The user can now model oil above AND below the bubble point, using the fully implicit numerical engine, without having to resort to the time and resource commitment of full-fledged reservoir simulation. The interface offers the convenience and “flow” of our existing models while providing the power and versatility of the numerical engine. History matching can be performed using rates or pressures.

In addition, the user can model more complex single-phase reservoir behavior using the Radial Composite, Multi-Layer and Dual Porosity models. The option of a time-dependent skin is also available.

Many reservoirs have properties that are pressure dependent. This is particularly true of overpressured formations. The “Geomechanical” option in F.A.S.T. RTA™ allows users to integrate the effects of stress dependent permeability and/or pore compressibility into their interpretation. The geomechanical model can be coupled with the advanced type curve methods and flowing material balance, as well as analytical and numerical models. Forecasts may be generated, comparing ultimate recovery under conditions of compaction, against that of a conventional reservoir.

Enhanced Flowing Material Balance

The Flowing Material Balance page has been enhanced to include a Flowing p/z plotting function, in addition to the existing Normalized Rate vs. Normalized Cumulative plot.

Advanced Properties Section

By enabling “Advanced Properties”, the user can access the powerful controls

for PVT and formation properties. All PVT properties can be customized, or correlations used. Relative permeability (two and three phase) can be specified or input based on correlations.

Enhanced Results Visualization and Mapping

The existing Map in F.A.S.T. RTA™ has been enhanced to include additional colour plotting options, including kh, xf, abandonment pressure and transient/boundary dominated flow. The bubble map parameter has also been extended to include OG(O)IP and EUR, in addition to drainage area. Fractured wells can be bubble-mapped as ellipses.

Enhanced Reporting / Printing Capabilities

The output reports and printouts in F.A.S.T. RTA™ have been redesigned with full customization in mind. The user can now design and collate custom report templates with full accessibility to all plots, grids and annotations.

Kevin Dunn is the Manager of Technical Sales at Fekete

years experience in corporate sales, and is now years experience in corporate sales, and is now coordinating activities with Fekete’s corporate clients. Niel is responsible for the F.A.S.T. RTA™ software, and is now in the process of ensuring that all clients have direct access to their production data through F.A.S.T. RTA™’s new database interface through F.A.S.T. RTA™’s new database interface tools.tools.

Russel WalshRussel Walsh has been tasked with managing F.A.S.T. Fieldnotes™ activities and ensuring F.A.S.T. Fieldnotes™ activities and ensuring easy access to support for the software. F.A.S.T. easy access to support for the software. F.A.S.T. Fieldnotes™ is currently being rebuilt to include Fieldnotes™ is currently being rebuilt to include many new tools that clients have requested. Contact many new tools that clients have requested. Contact Russ for more information on new functions, Russ for more information on new functions, or for technical support in using the software.

Jesse DunlopJesse Dunlop is a recent addition to our department. Jesse represents the F.A.S.T. Welltest™ and Validata™ software, and is quickly learning the many tools available in these packages. Contact Jesse to access information about the software and to coordinate analysis with Fekete’s welltest group.

Melissa Gillard is Fekete’s customer service specialist and contacts many of our clients to coordinate lunch-and-learns, internal courses and technical support.

Eris Latham is Fekete’s course coordinator. Eris handles the registration for all public courses, and handles the registration for all public courses, and also coordinates any in-house courses for clients.also coordinates any in-house courses for clients.

Naoko Yamaoka (not pictured) is Fekete’s software (not pictured) is Fekete’s software coordinator, and is responsible for processing all coordinator, and is responsible for processing all coordinator, and is responsible for processing all coordinator, and is responsible for processing all software licensing at Fekete.

My name is Kevin Dunn and I am the Manager of the Technical Sales department at Fekete Associates Inc. Over the past year, we have grown our sales department to meet the increasing needs of our clients. Our software is in use by almost 800 companies around the world with thousands of users. To ensure the prompt and attentive service our clients deserve, we have focused individual sales people on specific software and market groups. It is important to know that you can always contact any salesperson at Fekete for assistance, and we will ensure that you are taken care of. Allow me to introduce my group.

Leanne Christie is the assistant manager of our department. Leanne is responsible for the majority of the lease renewals that are completed at Fekete. She also coordinates many of the sales for small and intermediate producers.

Chris Wizniak is a sales engineer at Fekete who Chris Wizniak is a sales engineer at Fekete who Chris Wizniakis focused on three software packages, including F.A.S.T. Piper™, F.A.S.T. CBM™, and F.A.S.T. Virtuwell™. Chris is the primary contact for Virtuwell™. Chris is the primary contact for training sessions, lunch-and-learns, and one-on-training sessions, lunch-and-learns, and one-on-one support for these software packages. one support for these software packages.

In March 2005, In March 2005, Niel Beckie joined Fekete as a senior sales engineer. Niel has more than 11 senior sales engineer. Niel has more than 11

From Left to Right: Back Row: Russ. W., Jesse D., Chris W., Niel B., Melissa G. Front Row: Eris L. , Kevin D., Leanne C.

Dave Anderson is a SeniorTechnical Advisor at Fekete

F.A.S.T RTA™ 3.0 Release - p1 Tech Talk: Evaluation of Tight Gas Reserves - p2-3 Fekete’s Sales Group - p4

With recent high gas prices, strong market demand, and the steep decline in conventional gas reserves in North America, gas producers are turning to more “unconventional” resources that were previously uneconomical. It is estimated that current unconventional gas production now accounts for approximately one-tenth of Canada’s, and one-third of the United States, current supply.

In the spectrum of unconventional gas reserves, tight gas is the next immediate resource that will be exploited. CBM, shale gas and gas hydrates round out the resource spectrum and, while they are considered to be “tight”, the focus of this article is on low-permeability sandstone and carbonate reservoirs.

The definition of tight gas is not as precise as The definition of tight gas is not as precise as it may seem. While there is no specified cut-off it may seem. While there is no specified cut-off between conventional and tight gas, “tight” is a between conventional and tight gas, “tight” is a general term for low-permeability. In general, we general term for low-permeability. In general, we consider a formation permeability less than 0.1 consider a formation permeability less than 0.1 millidarcy to be tight. In the Western Canadian millidarcy to be tight. In the Western Canadian Sedimentary Basin, tight gas exists everywhere but Sedimentary Basin, tight gas exists everywhere but is predominant along the front ranges of the Rocky is predominant along the front ranges of the Rocky Mountains. In the U.S., tight gas formations are Mountains. In the U.S., tight gas formations are found throughout Wyoming, Colorado, Oklahoma, found throughout Wyoming, Colorado, Oklahoma, Texas and the Appalachian mountains.

When evaluating gas reservoirs, the industry standard methodology includes volumetrics, decline analysis, and material balance analysis. Volumetric in-place estimates do not vary between conventional and tight gas reservoirs since production is not a component of the calculation. However, there are several limitations in decline and material balance methods that can lead to erroneous results in tight gas reservoirs.

Decline analysis is an empirical observation of Decline analysis is an empirical observation of production data. It is simply a best-fit line through a cartesian plot of production rate vs. cumulative production. Two major assumptions are implicit when applying this technique: 1) the well is in “boundary dominated” flow, and 2) there is no change in the flowing conditions of the well.

In a tight gas reservoir, a well may take months, or even years, to reach pseudo steady-state flow. This often results in an underestimation of reserves in the early life of the well (Figure 1). In addition, this method can only quantify the expected ultimate recovery (EUR) from this well and does not tell us the original gas-in-place (OGIP).

Under most conditions, material balance is the most definitive method of determining the original gas-in-place. Static reservoir pressures are obtained from build-up tests, static gradients, and/or deliverability tests and are plotted vs. cumulative production. The extrapolation of a best-fit line yields the original gas-in-place (OGIP). For tight gas, the time to reach stabilization could last years and there could be significant lost production if the well is left shut-in for this duration. While some regulatory agencies in North America require reservoir pressure surveys,

they do not stipulate that the well must meet stabilized conditions. In tight gas reservoirs, the reported static pressure is typically lower than true reservoir conditions, resulting in an erroneously low calculation of OGIP (Figure 2). Advanced decline analysis methods, such as Advanced decline analysis methods, such as those in Fekete’s F.A.S.T. RTA™, have allowed those in Fekete’s F.A.S.T. RTA™, have allowed for a greater reliability in the estimation of gas-in-place and recoverable reserves. Although in-place and recoverable reserves. Although applicable to all types of reservoirs, F.A.S.T. applicable to all types of reservoirs, F.A.S.T. RTA™ is ideal for low permeability reservoirs. RTA™ is ideal for low permeability reservoirs. The Flowing Material Balance (FMB), one of the The Flowing Material Balance (FMB), one of the methods incorporated into F.A.S.T. RTA™, is a methods incorporated into F.A.S.T. RTA™, is a practical alternative to conventional decline and practical alternative to conventional decline and material balance analysis. The FMB incorporates material balance analysis. The FMB incorporates flowing rates and pressures in the calculation flowing rates and pressures in the calculation of gas-in-place. The well reaches stabilization of gas-in-place. The well reaches stabilization while producing, and shut-ins are not required.

Once stabilization is achieved, the FMB plot produces a straight line trend that points to OGIP, similar to a conventional material balance. In transient flow, the FMB calculates a minimum contacted fluid-in-place volume that is typically higher than traditional methods.

Traditional decline analysis assumes constant open-flow conditions at the surface. By incorporating the flowing pressures the true potential is determined. Once the well is in pseudo steady-state flow, and the pressure is constant, results from the traditional decline analysis will approach the FMB results. Figure 3 shows traditional decline analysis results for a tight gas well in early time production. The EUR is calculated to be 0.86 BCF under assumed constant flowing conditions. Figure 4 shows the

FMB analysis for the same well. From analog wells FMB analysis for the same well. From analog wells in the area, the recovery factor is estimated to be 85% and the resulting EUR is calculated to be 1.30 BCF. It is clear from this example that the reserves assigned to this well could easily be understated.

The use of F.A.S.T. RTA™ is not limited to the determination of OGIP or reserves. With good quality early time data, F.A.S.T. RTA™ is an effective tool for reservoir characterization. For example, in Texas, a company is entitled to receive tax credits for the production of tight gas. Recently, the Texas Railroad Commission accepted the results from a F.A.S.T. RTA™ analysis that proved the permeability of the reservoir to be under the prerequisite 0.1 mD. This resulted in increased net cash flows and eliminated production downtime and lost revenue.

Evaluation of Tight Gas Reserves

ConclusionTraditional evaluation methods have a tendency to underestimate reserves during early production of tight gas pools. Conducting a F.A.S.T. RTA™ analysis when evaluating tight gas reserves provides an “early radar” of EUR and total gas-in-place. F.A.S.T. RTA™ reduces the potential of understating tight gas reserve bookings and therefore, is extremely valuable in the early life of a pool. Based on the results from a F.A.S.T. RTA™ analysis, we can predict the production performance for a variety of infill scenarios and determine the optimal well density based on economics. Early time data analysis using F.A.S.T. RTA™ can also identify reservoir characteristics, such as permeability, without shutting the well in. As a consequence, there is minimal lost production from well downtime.Figure 1: Underestimation of EUR during Transient Period

Figure 2: Erroneously Low OGIP Calculated in a Tight Gas Reservoir

Figure 3: Traditional Decline Analysis

Figure 4: Flowing Material Balance

Gary Metcalfe is the Vice-President of Evaluations at Fekete

Material Balance Analysis

Cumulative Production

Decline Analysis

Cumulative Production (MMSCF)

Rate vs. Cumulative Prod.Rate vs. Cumulative Prod.

Cumulative Production (BCF)Cumulative Production (BCF)

Flowing Material BalanceFlowing Material Balance

Normalized Cumulative Production (BCF)

Casey O’Shea is a Project Engineer at Fekete

With recent high gas prices, strong market demand, and the steep decline in conventional gas reserves in North America, gas producers are turning to more “unconventional” resources that were previously uneconomical. It is estimated that current unconventional gas production now accounts for approximately one-tenth of Canada’s, and one-third of the United States, current supply.

In the spectrum of unconventional gas reserves, tight gas is the next immediate resource that will be exploited. CBM, shale gas and gas hydrates round out the resource spectrum and, while they are considered to be “tight”, the focus of this article is on low-permeability sandstone and carbonate reservoirs.

The definition of tight gas is not as precise as The definition of tight gas is not as precise as it may seem. While there is no specified cut-off it may seem. While there is no specified cut-off between conventional and tight gas, “tight” is a between conventional and tight gas, “tight” is a general term for low-permeability. In general, we general term for low-permeability. In general, we consider a formation permeability less than 0.1 consider a formation permeability less than 0.1 millidarcy to be tight. In the Western Canadian millidarcy to be tight. In the Western Canadian Sedimentary Basin, tight gas exists everywhere but Sedimentary Basin, tight gas exists everywhere but is predominant along the front ranges of the Rocky is predominant along the front ranges of the Rocky Mountains. In the U.S., tight gas formations are Mountains. In the U.S., tight gas formations are found throughout Wyoming, Colorado, Oklahoma, found throughout Wyoming, Colorado, Oklahoma, Texas and the Appalachian mountains.

When evaluating gas reservoirs, the industry standard methodology includes volumetrics, decline analysis, and material balance analysis. Volumetric in-place estimates do not vary between conventional and tight gas reservoirs since production is not a component of the calculation. However, there are several limitations in decline and material balance methods that can lead to erroneous results in tight gas reservoirs.

Decline analysis is an empirical observation of Decline analysis is an empirical observation of production data. It is simply a best-fit line through a cartesian plot of production rate vs. cumulative production. Two major assumptions are implicit when applying this technique: 1) the well is in “boundary dominated” flow, and 2) there is no change in the flowing conditions of the well.

In a tight gas reservoir, a well may take months, or even years, to reach pseudo steady-state flow. This often results in an underestimation of reserves in the early life of the well (Figure 1). In addition, this method can only quantify the expected ultimate recovery (EUR) from this well and does not tell us the original gas-in-place (OGIP).

Under most conditions, material balance is the most definitive method of determining the original gas-in-place. Static reservoir pressures are obtained from build-up tests, static gradients, and/or deliverability tests and are plotted vs. cumulative production. The extrapolation of a best-fit line yields the original gas-in-place (OGIP). For tight gas, the time to reach stabilization could last years and there could be significant lost production if the well is left shut-in for this duration. While some regulatory agencies in North America require reservoir pressure surveys,

they do not stipulate that the well must meet stabilized conditions. In tight gas reservoirs, the reported static pressure is typically lower than true reservoir conditions, resulting in an erroneously low calculation of OGIP (Figure 2). Advanced decline analysis methods, such as Advanced decline analysis methods, such as those in Fekete’s F.A.S.T. RTA™, have allowed those in Fekete’s F.A.S.T. RTA™, have allowed for a greater reliability in the estimation of gas-in-place and recoverable reserves. Although in-place and recoverable reserves. Although applicable to all types of reservoirs, F.A.S.T. applicable to all types of reservoirs, F.A.S.T. RTA™ is ideal for low permeability reservoirs. RTA™ is ideal for low permeability reservoirs. The Flowing Material Balance (FMB), one of the The Flowing Material Balance (FMB), one of the methods incorporated into F.A.S.T. RTA™, is a methods incorporated into F.A.S.T. RTA™, is a practical alternative to conventional decline and practical alternative to conventional decline and material balance analysis. The FMB incorporates material balance analysis. The FMB incorporates flowing rates and pressures in the calculation flowing rates and pressures in the calculation of gas-in-place. The well reaches stabilization of gas-in-place. The well reaches stabilization while producing, and shut-ins are not required.

Once stabilization is achieved, the FMB plot produces a straight line trend that points to OGIP, similar to a conventional material balance. In transient flow, the FMB calculates a minimum contacted fluid-in-place volume that is typically higher than traditional methods.

Traditional decline analysis assumes constant open-flow conditions at the surface. By incorporating the flowing pressures the true potential is determined. Once the well is in pseudo steady-state flow, and the pressure is constant, results from the traditional decline analysis will approach the FMB results. Figure 3 shows traditional decline analysis results for a tight gas well in early time production. The EUR is calculated to be 0.86 BCF under assumed constant flowing conditions. Figure 4 shows the

FMB analysis for the same well. From analog wells FMB analysis for the same well. From analog wells in the area, the recovery factor is estimated to be 85% and the resulting EUR is calculated to be 1.30 BCF. It is clear from this example that the reserves assigned to this well could easily be understated.

The use of F.A.S.T. RTA™ is not limited to the determination of OGIP or reserves. With good quality early time data, F.A.S.T. RTA™ is an effective tool for reservoir characterization. For example, in Texas, a company is entitled to receive tax credits for the production of tight gas. Recently, the Texas Railroad Commission accepted the results from a F.A.S.T. RTA™ analysis that proved the permeability of the reservoir to be under the prerequisite 0.1 mD. This resulted in increased net cash flows and eliminated production downtime and lost revenue.

Evaluation of Tight Gas Reserves

ConclusionTraditional evaluation methods have a tendency to underestimate reserves during early production of tight gas pools. Conducting a F.A.S.T. RTA™ analysis when evaluating tight gas reserves provides an “early radar” of EUR and total gas-in-place. F.A.S.T. RTA™ reduces the potential of understating tight gas reserve bookings and therefore, is extremely valuable in the early life of a pool. Based on the results from a F.A.S.T. RTA™ analysis, we can predict the production performance for a variety of infill scenarios and determine the optimal well density based on economics. Early time data analysis using F.A.S.T. RTA™ can also identify reservoir characteristics, such as permeability, without shutting the well in. As a consequence, there is minimal lost production from well downtime.Figure 1: Underestimation of EUR during Transient Period

Figure 2: Erroneously Low OGIP Calculated in a Tight Gas Reservoir

Figure 3: Traditional Decline Analysis

Figure 4: Flowing Material Balance

Gary Metcalfe is the Vice-President of Evaluations at Fekete

Material Balance Analysis

Cumulative Production

Decline Analysis

Cumulative Production (MMSCF)

Rate vs. Cumulative Prod.Rate vs. Cumulative Prod.

Cumulative Production (BCF)Cumulative Production (BCF)

Flowing Material BalanceFlowing Material Balance

Normalized Cumulative Production (BCF)

Casey O’Shea is a Project Engineer at Fekete

Fekete announces the long anticipated release of F.A.S.T. RTA™ version 3.0. This upgrade contains a variety of new features designed to enhance interpretation, modeling, and reporting of your production performance analysis.

New Features

• New Models - Multi-Phase (Numerical) - Composite - Multi-Layer - Dual Porosity - Geomechanical• Enhanced Flowing Material Balance• Advanced Properties Section• Enhanced Results Visualization and Mapping• Enhanced Reporting / Printing Capabilities

New Models

An extensive portion of our upgrade is devoted to new and enhanced modeling capabilities.

The user can now model oil above AND below the bubble point, using the fully implicit numerical engine, without having to resort to the time and resource commitment of full-fledged reservoir simulation. The interface offers the convenience and “flow” of our existing models while providing the power and versatility of the numerical engine. History matching can be performed using rates or pressures.

In addition, the user can model more complex single-phase reservoir behavior using the Radial Composite, Multi-Layer and Dual Porosity models. The option of a time-dependent skin is also available.

Many reservoirs have properties that are pressure dependent. This is particularly true of overpressured formations. The “Geomechanical” option in F.A.S.T. RTA™ allows users to integrate the effects of stress dependent permeability and/or pore compressibility into their interpretation. The geomechanical model can be coupled with the advanced type curve methods and flowing material balance, as well as analytical and numerical models. Forecasts may be generated, comparing ultimate recovery under conditions of compaction, against that of a conventional reservoir.

Enhanced Flowing Material Balance

The Flowing Material Balance page has been enhanced to include a Flowing p/z plotting function, in addition to the existing Normalized Rate vs. Normalized Cumulative plot.

Advanced Properties Section

By enabling “Advanced Properties”, the user can access the powerful controls

for PVT and formation properties. All PVT properties can be customized, or correlations used. Relative permeability (two and three phase) can be specified or input based on correlations.

Enhanced Results Visualization and Mapping

The existing Map in F.A.S.T. RTA™ has been enhanced to include additional colour plotting options, including kh, xf, abandonment pressure and transient/boundary dominated flow. The bubble map parameter has also been extended to include OG(O)IP and EUR, in addition to drainage area. Fractured wells can be bubble-mapped as ellipses.

Enhanced Reporting / Printing Capabilities

The output reports and printouts in F.A.S.T. RTA™ have been redesigned with full customization in mind. The user can now design and collate custom report templates with full accessibility to all plots, grids and annotations.

Kevin Dunn is the Manager of Technical Sales at Fekete

years experience in corporate sales, and is now years experience in corporate sales, and is now coordinating activities with Fekete’s corporate clients. Niel is responsible for the F.A.S.T. RTA™ software, and is now in the process of ensuring that all clients have direct access to their production data through F.A.S.T. RTA™’s new database interface through F.A.S.T. RTA™’s new database interface tools.tools.

Russel WalshRussel Walsh has been tasked with managing F.A.S.T. Fieldnotes™ activities and ensuring F.A.S.T. Fieldnotes™ activities and ensuring easy access to support for the software. F.A.S.T. easy access to support for the software. F.A.S.T. Fieldnotes™ is currently being rebuilt to include Fieldnotes™ is currently being rebuilt to include many new tools that clients have requested. Contact many new tools that clients have requested. Contact Russ for more information on new functions, Russ for more information on new functions, or for technical support in using the software.

Jesse DunlopJesse Dunlop is a recent addition to our department. Jesse represents the F.A.S.T. Welltest™ and Validata™ software, and is quickly learning the many tools available in these packages. Contact Jesse to access information about the software and to coordinate analysis with Fekete’s welltest group.

Melissa Gillard is Fekete’s customer service specialist and contacts many of our clients to coordinate lunch-and-learns, internal courses and technical support.

Eris Latham is Fekete’s course coordinator. Eris handles the registration for all public courses, and handles the registration for all public courses, and also coordinates any in-house courses for clients.also coordinates any in-house courses for clients.

Naoko Yamaoka (not pictured) is Fekete’s software (not pictured) is Fekete’s software coordinator, and is responsible for processing all coordinator, and is responsible for processing all coordinator, and is responsible for processing all coordinator, and is responsible for processing all software licensing at Fekete.

My name is Kevin Dunn and I am the Manager of the Technical Sales department at Fekete Associates Inc. Over the past year, we have grown our sales department to meet the increasing needs of our clients. Our software is in use by almost 800 companies around the world with thousands of users. To ensure the prompt and attentive service our clients deserve, we have focused individual sales people on specific software and market groups. It is important to know that you can always contact any salesperson at Fekete for assistance, and we will ensure that you are taken care of. Allow me to introduce my group.

Leanne Christie is the assistant manager of our department. Leanne is responsible for the majority of the lease renewals that are completed at Fekete. She also coordinates many of the sales for small and intermediate producers.

Chris Wizniak is a sales engineer at Fekete who Chris Wizniak is a sales engineer at Fekete who Chris Wizniakis focused on three software packages, including F.A.S.T. Piper™, F.A.S.T. CBM™, and F.A.S.T. Virtuwell™. Chris is the primary contact for Virtuwell™. Chris is the primary contact for training sessions, lunch-and-learns, and one-on-training sessions, lunch-and-learns, and one-on-one support for these software packages. one support for these software packages.

In March 2005, In March 2005, Niel Beckie joined Fekete as a senior sales engineer. Niel has more than 11 senior sales engineer. Niel has more than 11

From Left to Right: Back Row: Russ. W., Jesse D., Chris W., Niel B., Melissa G. Front Row: Eris L. , Kevin D., Leanne C.

Dave Anderson is a SeniorTechnical Advisor at Fekete

F.A.S.T RTA™ 3.0 Release - p1 Tech Talk: Evaluation of Tight Gas Reserves - p2-3 Fekete’s Sales Group - p4