Exploration and Production maximizes the long term economic value of gaseous and non-gaseous hydrocarbon reserves, while ensuring the safety of its facilities and personnel, and in harmony with Venezuelan society and the environment.
Exploration is key withih the oil industry processes, as it drives the discovery of hydrocarbons (gaseous and non-gaseous) in the subsoil. Exploration is the first link in the chain, as it is part of the upstream business, and the lifeblood of PDVSA.
The primary goal of Exploration is the incorporation of hydrocarbon resources, following PDVSA guidelines to ensure business continuity. In the short and medium term, PDVSA strategy to improve performance has been to adopt best practices for business, processes, productivity, environment and industrial safety operations. The production stage involves the exploitation of oil and natural gas from the reservoirs or reserves. The production phase of a hydrocarbon producing field begins after the presence of the resource has been verified through the drilling of exploratory wells.
Exploration and Production processes are interrelated through the execution of the different phases that are carried out before, during and after the projects that underpin the business plan.
There is a broad and close relation between Exploration and the different Production organizations, such as drilling, integrated studies, engineering and construction, reserves, among others. This is a bidirectional relationship (client-provider) that must be highly dynamic and effective in order to achieve the common objectives of Exploration and Production. In addition, thanks to innovations in technical and technological areas, exploration and production activities have been strengthened and revitalized, with the goal of making PDVSA the most successful oil company of the 21st century.
All of the crude and natural gas reserves located in Venezuelan territory are the property of the republic. They are estimated by PDVSA and officialized by the Petroleum Ministry (MPetro), following the hydrocarbon glossary and standards manual. These standards not only include specific procedures for reserves calculation but also control the information required by the nation. These procedures are the same as the ones used worldwide which means that the values declared are comparable to those of other countries.
Proven Reserves
These are estimated quantities of crude oil and natural gas in known wells that with reasonable certainty can be recovered in the future under the current economical and operational conditions. Due to the uncertainty and the limited data on wells, reserves estimation can be subject to modifications through time as more information becomes available. Proven reserves do not include additional volumes that could be the result of extending the current explored areas or the implementation of secondary recovery processes that have not been tested and described as economically feasible.
Hydrocarbon reserves are readjusted annually to consider among other variables: crude volume, extracted gas, injected gas, reserves changes due to new discoveries or the revision of the existing ones. All of which generates changes in the proven wells reserves. According to facilities production, proven reserves are classified as follows
Proved Developed Reserves:
Quantities that can be recovered through existing wells and by existing equipment and methods.
Proved Non Developed Reserves:
Volumes expected to be recovered through investment of new well drillings in non developed areas or through the finalization of existing wells.
In 2015, crude and gas represented 90% and 10% respectively of the total estimated proven reserves on an equivalent crude base.
In 2015, production was of 1,001 million barrels of crude (MMB) or 2,742 thousand barrels per day (MBD), for an accumulated production from 1914 to December 31st, 2015 of 70,166 MMB. Commercial crude production in Venezuela is focused on the following basins: Maracaibo-Falcon (formerly Western-Zulia), with an accumulated volume of 44,054 MMB which extends on land through Zulia, Falcon, and Trujillo states and the territorial waters of the Gulf of Venezuela; Barinas-Apure (formerly Southern Central Barinas and Apure) with 1,517 MMB and which extends through Barinas and Apure states. Accumulated production at the Eastern basin is 24,595 MMB and it extends through Guarico, Anzoategui, Monagas, Delta Amacuro and Sucre states (the Hugo Chávez Orinooco OIl Belt belongs to the Eastern basin). The Carupano basin does not have an accumulated production since it was incorporated in 2006 and it encompasses northern Sucre state, Nueva Esparta state, as well as the territorial waters located in front of the Venezuelan eastern coast.
According to production levels from 2015, proven crude reserves which include heavy and extra heavy crude reserves have a depletion time of 301 years approximately.
Crude Reserves
In 2015, the proven crude reserve level was 30,0878 MMB. Reserve distribution by basin: 20,330 MMB Maracaibo - Falcón, 1,088 MMB Barinas – Apure, 279,117 MMB Eastern and 343 MMB Carúpano. The Hugo Chávez Orinoco Oil Belt (FPO) is part of the Eastern basin and its reserves are 270,703 MMB of crude out of which 2 MMB correspond to wet gas, 76 MMB condensate crude, 1,609 MMB light crude, 1,202 MMB medium crude, 8299 MMB heavy crude, and 259,515 MMB extra heavy crude
Natural Gas Reserves
Venezuela has proven natural gas reserves of 201,349 billion cubic feet (BCF), (34,715 million barrels of oil equivalent - BOE) by the end of December 2015, out of which 64,916 BCF (11,192 MMBOE) are associated to the Hugo Chávez Orinoco Oil Belt, thus it is confirmed that the existing oily sands in this area are not bitumen but oil. Out of the total proven reserves of natural gas, 36,452 BCF (6,285 MMBOE) are associated to the extra heavy oil at the Eastern basin. Natural gas reserves in Venezuela are mostly associated gas which is produced along with oil; a high amount of these proven reserves are developed.
1. - Identification of areas of interest At this stage exploration begins in an unspoilt or unknown region.
It is a preliminary phase in which indirect methods are used such as surface geology (rock sampling) or field geology, air and space reconnaissance (radars, aeromagnetic and aerogravimetry methods), geochemistry and geophysics.
Areas are identified with characteristics that favor the existence of hydrocarbons in the subsoil.
2.-Trap detection When the area of interest has been detected structures that could contain oil are identified.
For this phase high technology geophysical methods are used such as 3D seismic and advanced methods of data visualization and interpretation.
In this stage, hydrocarbon traps are defined in a detailed manner (prospects) and are prioritized according to estimated reserves and potential economic value.
3. - Accumulation verification. When the prospects have been identified, exploration wells are drilled which is the only reliable mean to confirm that there really is oil in such location.
During this stage, a geologist extracts information from rock fragments detecting potentially producing layers or gravel.
Exploratory drilling is a very expensive and high risk operation where geological interpretation, skills, time invested and operational risks are involved.
Statistically, only three out of ten wells drilled in the world lead to the discovery of a reservoir.
1.-Reservoir flow. This phase refers to the difficult and complicated oil route within the reservoir thousand of meters deep through micro channels of porous and permeable rock until reaching the bottom of the well. Oil takes this route due to the natural pressure or energy that exists in the reservoir.
2. - Well production. Once oil reaches the bottom of the well it continues its route through the vertical production tubing until reaching the surface. As oil rises (by natural or artificial means), pressure decreases and gas originally dissolved in the crude is released.
3.-Oil collection. After oil from each of the reservoir wells has reached its surface it is collected by a line system from the well head to the flow stations.
4.-Gas separation. At the flow stations the oil and gas from the wells enter separators where gas separation from oil is completed. After exiting the separators oil and gas take different routes to meet the different uses and established applications.
5.-Oil storage. The different types of crude that reach the flow stations are pumped through pipelines to the tank farms where oil production from a determined area is finally collected and stored to be later treated and desalted while meeting commercial specifications.
6.-Pipeline transportation. The clean crude stored in the tank farms is pumped through the pipelines to the refineries in the country and to the shipping terminals for export markets
7.-Shipping and exporting The oil that reaches the shipping terminals is loaded onto the tanker fleet to be sent to different markets around the world.
As a result of the work by Exploration during 2015, it has been reported to the People's Power Ministry of Petroleum a volume of reserves of 5,560 MMB of crude and 3,312.16 BCF of gas out of which 12.80 MMB of crude and 1,217.01 BCF of gas are their own effort and 42.80 MMB of crude and 2,095.16 BCF of gas are the joint ventures'. Such volumes are associated to reserves through discovery with the drilling of the deep exploration wells Vlb-1624 and A-162 in the west, RG-230 and J-495 in the east.
In 2015, exploratory studies focused on the revision, identification, and maturing of new opportunities to incorporate and update the exploration resources base and exploratory locations that support a short and medium term plan with the purpose of identifying the required hydrocarbon volumes.
At the close of this period, we have worked on 20 domestic projects, 16 on land and three offshore, as well as a special project (gas license granting).
Also in 2015, we have worked on two international study projects with countries that have signed cooperation agreements, Bolivia and Cuba, for the research of significant volumes of liquid and gaseous hydrocarbons with expectations in the order of 3,685 MMB and 2,6231.10 BCF respectively.
In 2015, crude production nationwide reached a total of 3,184 MBD distributed as follows: Eastern Production Executive Office 601 MBD (Direct management 568 MBD, Joint ventures 14 MBD, and PDVSA Gas 19 MBD), Offshore Production Executive Office 52 MBD (to date there is only contribution from joint ventures), Western Production Executive Office 1,010 MBD (Direct management 634 MBD, Joint Ventures 376 MBD), Hugo Chávez Orinoco Oil Belt (FPO) Executive Office of Production 1,442 MBD (Direct Management 577 MBD, Joint Ventures 865 MBD) and New Developments Production Executive Office 79 MBD
In 2015, audited crude production plus NGL Nation total attributed to PDVSA was 2,863 MBD, distributed as follows: Eastern Production Executive Office 801 MBD (Direct Management 767 MBD, Joint Ventures 14 MBD and PDVSA Gas 20 MBD), Offshore Production Executive Office (Joint Ventures 35 MBD), Western Production Executive Office 707 MBD (Direct Management 365, Joint Ventures 342 MBD), Hugo Chávez Orinoco Oil Belt Executive Production Office 1,265 MBD (Direct Management 503 MBD, Joint Ventures 762 MBD) and New Developments Production Executive Office 55 MBD
During 2015, on average the total Nation natural gas production was of 7,756 BCFD, out of which 2,460 MMCFD were injected to maintain reservoir pressure. Net Natural Gas production was 5,296 MMCFD (913 MBOE).
Eastern Production Executive Office
Punta de Mata and Furrial divisions reached 182.8 MBD. This production was boosted through Reconditioning/Recompletion with and without the drill with a contribution of 140.6 MBD, 18 completion wells producing 29.2 MBD y 48 stimulations producing 13 MBD.
Additionally, the following actions were carried out for energy control and maintenance to improve replacement volume factors.
• Closure of eight wells with high gas petroleum ratio with an associated production of 5.8 MBD and 185.7 millions of cubic feet per day. Punta de Mata and Furrial Divisions.
• Closure of three wells with high water oil ratio with an associated production of 0.6 MBD to preserve reservoir energy on Carito and Furrial fields.
• Startup of T-2 from PIGAP II for injection, increasing production by 200 MMCFPD. Punta de Mata Division.
•Improvement of the injection profiles in five wells. Punta de Mata Division.
• Closure of three Wells with high gas injection and low production 0.8 MBD and 15.6 MMCFPD respectively which allowed the convertion of seven wells to gas lift with an associated production of 11.3 MBD and 14.9 MMCFPD.
As a strategy to increase crude production work, we have worked on deepening the gas lift injection points, for an additional generation of 8.5 MBD associated to five wells. Furrial Division.
Western Division
The Rafael Urdaneta Gas Project aims to ensure the development of Non Associated Natural Gas in the Gulf of Venezuela, and northeast of Falcón state in an area of approximately 30,000 km² handling a reserves margin of 9.5 BCF. Operational goals for 2015 were focused on the Perla field gas development (Cardon IV Block). We achieved production startup in July, with 50 MMCFPD, and incorporated 300 MMCFPD in September 2015, for a total of 450 MMCFPD. We also added 14 MBD of condensate thus meeting our production goal for 2015.
Drilling and completion of four wells was carried out on Perla field (Perla 7, Perla 6, Perla 5 and Perla 1X), as well as the total installation of the Main Production Platform PP1 and the partial installation of the Satellite Platforms PS2 and PS3.
We achieved the energization and startup of Train 150 in July 2015 and Train 300 in August 2015. Both trains make up the Tiguadare Gas Treatment Plant in the Carirubana municipality, Punto Fijo, Falcón State.
Western Production Executive Office Lake Division.
We replaced 175 lines to wells, manifolds and flow stations with flexible lines all equivalent to 223.1 km for a production of 29.4 MBD and 46.6 MMCFPD.
Western Coast Division
For production support of this division, best practices were carried out for the well completion process using non reactive components thus avoiding damages to formation.
Separation tank T-202 in PLD-3 was started up, thus optimizing production and crude handling in the plant
Eastern Coast Division
We optimized and changed the design in eight progressive cavity pumping wells with an increase of 400 BPD.
Additionally, we installed facilities and transported portable boilers B15 a B16 cluster from block J-8 for steam injection in new wells. The wellflux project was executed on well LSJ3714 and successfully installed the thermal inductor with subsoil Maxflu pumps in well LSJ3593, managing savings at the service drill’s inlet as well as a decrease in deferred production while increasing the life of the equipment. This proved to be a success in the joint venture Petrocabimas.
Southern Lake Division (Trujillo state)
The drilling of well FRA-21X produced 200 BPD. For the proper handling of gravel and drilling sludge, seven canoe type tanks were built with filtering chambers thus decreasing drilling times as well as costs and environmental risks.
Hugo Chávez Orinoco Oil Belt Executive Production Office
During 2015, 595 producing wells were drilled with an associated production of 216.4 MBD:
Carabobo Division
227 producing wells were drilled with an associated production of 106.3 MBD. Mechanical, civil, electrical and instrumentation facilities were constructed to expand compression and treatment capacity at the Orinoco Compression Plant from 35 MMCFPD to 60 MMCFPD to ensure the handling of associated gas to the production of Morichal's extra heavy area and the Sinovensa joint venture.
We constructed and started up the portable production module for dehydration and desalting of 40 MBD of EHCO (43,600 barrels of diluted crude of 16º API and 12% water and sediments), thus increasing the operational flexibility and reliability of the Petrolera Sinovensa plant.
Junín Division
152 producing wells were drilled with a production of 46.2 MBD.
We are currently building an 8-inch, 8 km gas line from well J-17-01G located in Petro San Felix's Zuata Principal field to the inlet lines at the gas plant for power generation. This will ensure fuel gas flow (10 MMCFPD) which will be used as feed for plant process gas.
Ayacucho Division
213 producing wells were drilled for a production of 63.6 MBD.
We expanded and renovated the Miga repumping station, increasing capacity from 29.5 MBD to 90 MBD through the construction of a diluent tank of 24 MB. We installed four centrifuge pumps of 33 MBD as well as a fire and comprehensive protection system.
We expanded the Casma Anaco compression plant to increase production on Casma Anaco field from PetroCuragua joint venture to 10 MMCFPD, optimizing crude and gas production process in the wells with artificial lifting extraction methods.
Boyacá Division
Three producing wells were drilled for a production of 0.25 MBD. We also built mechanical facilities for handling production from new wells.
New Developments Production Executive Office
This office supports production infrastructure and crude handling in the new areas of the Hugo Chávez Orinoco Oil Belt. Most of the major projects under execution are for the construction of pipelines and terminals for handling early production. In the January – December 2015 period, 158 producing wells were drilled with an associated production of 60.9 MBD.
Carabobo Division
88 producing wells were drilled for a production of 45.5 MBD. Petrocarabobo joint venture drilled 23 producing wells for a production of 15.4 MBD, and completed the construction of the Commercial Fluid Processing Center (30 MBD) for the safe and effective handling of the produced fluid. It is currently in pre startup stage.
Joint Venture PetroIndependencia drilled 65 producing wells for a production of 30.1 MBD.
Junín Division
70 producing wells were drilled for a production of 15.4 MBD.
Offshore Executive Production Office Eastern Division
In 2015 we successfully conducted the evaluation and the upper and lower completion of the wells form Dragon field (DR-11, DR-9, DR-8 and DR-5A) which constitute the Accelerated Production Scheme for an associated production of 220 million cubic feet of gas per day.
There was a 91.5% advance in the construction of the Dragon-CIGMA 36 inch and 103 Km gas pipeline at the Gran Mariscal de Ayacucho Industrial Complex.
Also, there was an advance of 85.6 % of the installation of the Piperack associated to gas inlet facilities of the PAGMI gas plant, and the construction of the foundations for the different types of equipment to be installed (slug catcher, portable dehydration units, and others).
Meeting the volumetric goals established in the business plan of the CVP with the Joint Ventures are a challenge for PDVSA and involves the application of new technologies that mitigate barriers in mature fields. This is part of the strategies aimed at strengthening technological sovereignty in the hydrocarbons sector.
A diagnostic of the current crude production of mature fields by Joint Ventures can be summarized as follows:
1. Reservoir conditions in mature fields require the application of different technologies for drilling and rehabilitation of wells such as the availability of new generation equipment, directional drilling, engineering, horizontal well design and execution as well as the application of new drilling fluid designs.
2. In light and medium Joint Ventures the most common technologies used are related to drilling fluids, hardening, cleaning and control, use of rotating tools in directional bores and well completion tools. Their application has resulted in more than 7,000 active wells by the end of 2015.
3. In addition to the strategies already implemented with the synergy between partners, for the 2016-2025 period we anticipate the application of other technologies focused in drilling under balance to control wells and avoid damage to the reservoirs, multilateral drilling, steering in highly deviated drilling and new options for water isolation during well rehabilitation.
So far light and medium Joint Ventures have applied technologies in synergy with their partners in order to increase production. Most of these technologies are focused on drilling activities (drilling and reconditioning) which aim at reducing downtime, minimize formation damage, and cost optimization.