Page 20 - Principles of Catalyst Development

Chapter 1

Introduction to Reservoir Management

Reservoir modeling exists within the context of the reservoir management
function. Although not universally adopted, reservoir management is often
defined as the allocation of resources to optimize hydrocarbon recovery from
a reservoir while minimizing capital investments and operating expenses
[Wiggins and Startzman, 1990; Satter and Thakur, 1994; Al-Hussainy and
Humphreys, 1996; Thakur, 1996]. These two outcomes - optimizing recovery
and minimizing cost - often conflict with each other. Hydrocarbon recovery
could be maximized if cost was not an issue, while costs could be minimized
if the field operator had no interest in or obligation to prudently manage a finite
resource. The primary objective in a reservoir management study is to determine
the optimum conditions needed to maximize the economic recovery of hydrocar-
bons from a prudently operated field. Reservoir modeling is the most sophisti-
cated methodology available for achieving the primary reservoir management
objective.
There are many reasons to perform a model study. Perhaps the most
important, from a commercial perspective, is the ability to generate cash flow
predictions. Simulation provides a production profile for preparing economic
forecasts. The combination of production profile and price forecast gives an
estimate of future cash flow. Other reasons for performing a simulation study
from a reservoir management perspective are listed in Table 1 -1. Several of the
items are discussed in greater detail in later chapters.