Decline Curve

What is a Decline Curve?

The decline curve is a method for estimating reserves and predicting the rate of oil or gasoline production. It usually presentations the pace at which production is expected to mention no over the lifetime of an energy asset.

Understanding the decline curve can be in agreement a producer estimate the amount of oil reserves that can come from a correctly over its lifetime, the present and longer term value of a correctly, and the rate at which property should depreciate on a company’s books. In combination, the decline curve can also be in agreement make a decision the rate of producing for an entire reservoir or even a couple of reservoirs.​​​​​​​

How a Decline Curve Works

The decline curve is a method used to make a decision estimated ultimate recovery (EUR) for an oil or gasoline reserve. This calculation rests on a collection of equations that U.S. geologist J.J. Arps complex in 1945. It is of the utmost importance that drilling duties meet an acceptable EUR threshold for a enterprise to be considered viable and profitable.

In thought, the decline curve can practice to most wells inside the trade. Underlying the decline curve equations is an expectation that well-production usually follows a three-part pattern. 

1. Throughout the initial section production section, the float of oil or gasoline remains rather strong, as force stays on the subject of constant.
2. Next is a short lived duration all the way through which the float of oil or gasoline declines abruptly, as the amount of recoverable property and force inside the wellbore decreases.
3. In spite of everything, property burn up to a point at which they approach the correctly’s defined hindrances.

Arps’ decline curve equations most regularly practice to the boundary-defined production section.

Calculating the decline curve involves a curve-fitting exercise to interpolate the long term charge of producing based on earlier production levels. Because of this reality, a quite lengthy duration of time-series wisdom is needed to estimate the projected building. Moreover, the decline-curve equations think that a couple of variables serious about production and operations stay constant right through the lifetime of a correctly asset. Mainly based on correctly conditions, 3 varieties of decline curves can practice to the long term building: exponential, hyperbolic and harmonic.

Professionals and Cons of the Decline Curve

Analyzing the decline curve usually is a more straightforward method to estimate production levels relative to more-complex simulations. Then again, the usage of the decline curve moreover can be a lot much less right kind than simulations. 

The use of the decline curve has numerous shortcomings, in conjunction with that it might underestimate oil reserves, underestimate production fees, and overestimate reservoir potency. Because it relies on earlier wisdom, the decline curve does no longer be mindful the labor, equipment, and technology changes which may affect production fees. It moreover can not account for the danger of geologic changes that more-complex models might be able to include to some degree. Then again, the Arps equations are nevertheless in use these days.