BlackGold Project Annual Performance Project Annual Performance - ... AER Presentation ... T24 T23...

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BlackGold Project Annual Performance

-

Commercial Scheme Approval No. 11387D

November 14, 2013

2

Contents

•

Introduction

•

Subsurface Update

•

Surface Operations Update

•

Compliance Update

•

Q&A

AER Presentation •

Novermber

2013 2

3

BlackGold

Scheme of Amendments/Approvals

•

Commercial Scheme Approval No. 11387 on Feb. 03 2010 for BG First

Phase to produce 1,590 m3/d bitumen.

•

Amendment Approval No. 11387A on Sep. 1st 2010 transfer of BlackGold

Oil Sands Lease from KNOC Canada to Harvest Operations Corp.

•

Amendment Approval No. 11387B on Jan. 30 2012 confirming a minor modifications to the plot plan and modification of well trajectories.

•

Amendment Approval No. 11387C on Mar. 07 2012

confirming a minor modifications to CPF.

•

Amendment Approval No. 11387D on Sep. 26 2013, for Second Phase Application to produce an additional 3,180 m3/d bitumen.


Novermber

2013 3

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BlackGold

Project Location

•

Harvest hold 100% ownership of 15 sections in 76-7-W4M , located approximately 10 km southeast of Conklin


Novermber

2013 4

DEVON ENERGY JACKFISH PROJECT 1

DEVON ENERGY JACKFISH PROJECT II

HARVEST OPERATIONSBLACKGOLD PROJECT

CENOVUS / CONOCOCHRISTINAL LAKE REGIONAL PROJECT

NEXEN / OPTIJACKFISH PROJECT

PETROBANK ENERGYWHITESANDS

EXPERIMENTAL PROJECT

MEG ENERGYCHRISTINA LAKE

REGIONAL PROJECT

R4W4R5R6R7R8R9R10

R3W4R4R5R6R7R8R9

T74

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HARVEST BLACK GOLD

ALBERTA

1

20

30

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60

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30

W5510

1520

25

W4

510

15

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W6510

R 1W4R2R 3R4R 5R6R7R8R 9R10R 11R 12R13R14R 15R16R 17R18R19R20R 21R 22R23R24R25R26R27R 28R 29R 30R 1W5R 2R3R4R 5R 6R7R 8R 9R 10R 11R12R13R14R15R16R 17R 18R19R20R 21R 22R23R 24R 25R26R27R 28R1W6R2R3R4R 5R6R7R8R 9R 10R11R12R 13

R1W4R 2R 3R4R5R6R7R 8R 9R 10R 11R12R 13R14R15R 16R17R 18R19R20R21R 22R23R 1W5R2R 3R 4R 5R6R7R8R 9R10R 11R 12R13R 14R15R16R 17R18R 19R20R21R22R 23R1W6R 2R3R 4R 5R6R7R8R9R10R11

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5

Project Area & Exploration Activity


Novermber

2013 5

: Initial Project Area

: Expansion Project Area

: Central Production Facility

: IDA (Initial Development Area)

• Project Area

• Exploration Activity : Drilled before 2006 (52 wells)

: Drilled 2007 (19 wells)



: 3D Seismic (23

km2)

: 4D Seismic (4.3

km2)

6

Subsurface Update


Novermber

2013 6

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General Stratigraphy


Novermber

2013 7

Stratigraphic Column Reference Well 9-1-76-7W4M

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Average McMurray Reservoir Properties

•

Reservoir Depth: 400mTVD (~205mSSL)•

McMurray Thickness: 45-55m

•

Pay Thickness: 25-35m•

Porosity: 31%

•

Perm.: Khmedian

=4D, Kv

/Kh

~ 0.7•

Oil Saturation: 68%

•

Virgin Reservoir Pressure: 2.6 MPaa•

Virgin Reservoir Temp: 12�C

Deterministic Pay Cut-Offs•

Sw<50%

•

Φe>20%•

Minimum SAGD Pay Isopach > 10m


Novermber

2013 8

1AA/08-12-076-07W4/00

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Original Bitumen In Place (OBIP)


Novermber

2013 9

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Isopach Map of Net Bitumen Pay


Novermber

2013 10

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Top of Bitumen Pay


Novermber

2013 11

Subsea elevation (m)

Pad 102

Pad 101

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Bottom of Bitumen Pay


Novermber

2013 12

Subsea elevation (m)

Pad 102

Pad 101

13

Basal McMurray Water Isopach


Novermber

2013 13

14

Phase 1 Representative Well Log


Novermber

2013 14

Top BHLTop BHL

Top McMTop McM

Top WabTop Wab

2-12

Net Bitumen Interval

McMurray Regional Barrier

Clearwater Regional Caprock

40m

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Cores & FMI Logs


Novermber

2013 15

: Expansion area

: Initial area

: Initial Development Area

: Well with core (131 wells)

: Well with FMI Logs (24 wells)

Legend

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BlackGold

Lease Cross-Section


Novermber

2013 16

South to North

Pay zone

Pay zone

Southeast North

A

A’

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Seismic Cross-Section


Novermber

2013 17

A

A’

A A’

Top BHLTop BHL

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4D Seismic


Novermber

2013 18

2.4km

1.8k

m

4D Seismic Parameters

Area 4.26 km2

Bin size 10m x 10m

Shot interval 20m

Shot line 80m

Receiver interval 20m

Receiver line 120m

Record length 1000 ms at 1/2 ms

Source typeSingle vibe, 8‐200Hzlinear@12000ms

Receiver type GS‐30CT, 6 over 1 m

Geophone

type10‐14 Hz spiked

geophone

Type of

instrument

Telemetry

Pad 102

Pad 101

•

Harvest acquired 4D seismic for initial development area in February 2012

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Surface Deformation Monitoring

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2007 five corner reflectors have been installed.

•

2007 June to August SAR analysed, no surface deformation observed.

•

Additional corner reflectors will be installed in Phase 1 area.

•

Harvest will acquire the new SAR data before and after steam injection


Novermber

2013 19

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BlackGold

Reservoir Geomechanics

Overview

•

Minifrac

physical testing results obtained in 2008.

•

The in-situ minimum stress in the McMurray shale is: 6.01 –

6.9 MPaa

(16.7 –

19.2 KPa/m).

•

BG geomechanical

modeling confirmed that BG McMurray caprock integrity has Maximum Downhole Pressures of 6 MPaa.


Novermber

2013 20

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Reservoir Engineering/Modeling Plans•

BlackGold

Phase 1:

•

Pad scale simulation is underway to forecast scheme performance,

•

Maximum Operating Pressure (MOP) during SAGD start-up is 4MPaa,

•

Wellpairs

are expected to be converted to SAGD after 90 –

120 days of steam circulation,

•

Operating SAGD Chamber Pressure (OSCP) is between 2.6 –

3MPaa,


Novermber

2013 21

BG Phase 1 West Side Model

BG Phase 1 East Side Model

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Layout for Initial SAGD Well Pair

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Pad 101 : 5 well pairs

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Pad 102 : 10 well pairs

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Reservoir Depth : ~400m TVD

•

Horizontal Length : 750~850m

•

Well Spacing : 80~100m

•

Vertical Separation : 5m


Novermber

2013 22

Pad 102

Pad 101

1

12

13 24

100m100m100m100m100m100m100m100m

100m10

0m10

0m80

m80

m

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Drilling Operations

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Key Features:o Well Integrity o BoreHole

Quality o Bond Log quality o Sand control

•

Finished drilling in September, 2012


Novermber

2013 23

Nabors 103 on PAD 102

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Directional Survey


Novermber

2013 24

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Sand Control

-

FacsRite

= Flush Absolute Cartridge System


Novermber

2013 25

Harvest installed Facsrite

sand control system in 15 producers:-sand retention and retained permeability properties,

-tolerates wider variation in PSDs,

-higher OFA than gap-based media,-premium media discs flush-mounted and tightly secured into the base pipe,-316 SS, 25.4 mm disc with open flow area of 3.61% (OFA) @ 22 discs/ft.

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Well Schematic Diagram -

Injector


Novermber

2013 26

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Well Schematic Diagram–Producer(warm-up)


Novermber

2013 27

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Well Schematic Diagram –

Producer(SAGD)

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Harvest plans to install ESP (Electric Submersible Pump) in producer after the circulation period


Novermber

2013 28

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Instrumentation

•

Producers:o 15 DTS fiber system during

circulation and SAGD phase,

o 15 heel bubble tube during circulation phase,

•

Injectors:o 8 DTS fiber system during

circulation and SAGD phase,

o 15 heel bubble tube during circulation and SAGD phase.


Novermber

2013 29

I & P with InstrumentationProducer with instrumentation

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Instrumentation Observation Wells

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Harvest drilled 12 observation wells in 2011 to monitor performanceo 4 clamp type wells installed thermocouples and pressure gaugeo 8 spool in type wells installed thermocouples


Novermber

2013 30

: Pres./Temp. Sensor : Temp. Sensor Only

BHL/WOC

McMurrayReservoir

Wabiskaw/McMurray

Shale

Thermocouples(2 ~4m interval)

PressureSensors

Thermal Cement

31

Artificial Lift

•

All producers will be equipped with 250C ESP systems.

•

All ESPs

will have downhole pressure/temperature monitoring systems.

•

ESP total fluid production capacity will vary between 300 to 730 m3/day.


Novermber

2013 31

32

Brackish Water Wells

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1-11-76-7W4M & 7-11-76-7W4M

o Depth : 350 to 353 mTVD

o Formation : Clearwater

o TDS : 4,320 to 4,550 mg/L

o Estimated production rate 350m3/day/well


Novermber

2013 32

7-11(Source Water Well)Formation : ClearwaterTDS : 4320~4340 ppm

1-11(Source Water Well)Formation : Clearwater

TDS : 4550 ppm

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Water Usage and Balance


Novermber

2013 33

Injection/Production Wells

Brackish Water Wells

Source Water Pipeline Skim

Tank

Utility WaterTreatmentPackage

Utility WaterTank

Produced

WaterTank

WaterTreatmentPackage

BoilerPackage

Pipeline CPF

Produced Water

(4,291 m3/d)

Bitumen Emulsion

Steam(4770m3/d)

Utility Water(50m3/d)

Safety Shower

10% Steam Lossto the Formation

(477m3/d)

Daily Make-up Water

(608m3/d)Make-up Water to WT System including Loss

from WT System(558m3/d)

Oil/WaterSeparatorWater in Sales

(8 m3/d)

Loss to Air (73 m3/d)

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Phase 1 Future Plan

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Well completions scheduled for Q1 2014.

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Commissioning of wells and pads end of Q1 2014.

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First steam in Q3 2014

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ESP conversion in Q4 2014.

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Harvest will acquire next a 4D survey in 2015.


Novermber

2013 34

35AER Presentation •

Novermber

2013 35

Surface Operations Update

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Update Facility Construction –

Main Activities•

93% progress achieved by end of 2013

•

Completed civil work

•

Completed Mechanical (modules & equipment) Installation

•

Erected and hydro-tested all Field Tanks(12ea)

•

Completed Pipelines by middle of Nov 2013

•

Completed Buildings Exterior by end of Dec 2013

•

Completed construction of Wellpads

by Jan 2014

•

Ongoing piping and cabling etc.AER Presentation •

Novermber

2013 36

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CPF Construction Overview (dated July 2013)


Novermber

2013 37

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CPF Construction Status


Novermber

2013 38

Main Elec. B/D(ELM-02)

Water Treatment Pkg.(Area 31)

Flare stack Area(Area 60)

Sales Oil/Off Spec Tanks(Area 70)

Water Treat. TK(Area 30)

Oil Treat. Area(Area 20/21)

Boiler Pkg.(Area 40)

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G/D Line & Wellpad

Construction Status


Novermber

2013 39

40AER Presentation •

Novermber

2013 40

Compliance Update

41

•

Harvest submitted the following plans in accordance with the EPEA Approval

o Caribou Protection Plan Update (Oct. 2013)

o Conservation and Reclamation Report

(Mar. 2013)

o Baseline Soil Monitoring Program Proposal (Nov. 2012)

o Fugitive Emissions Leak Detection and Repair Program (Nov. 2012)

o Historical Resources Act Clearance

(July 2012)


Novermber

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Environmental Issues

•

Wildlife Monitoring Program Initiated (Oct. 2012)

o Installation of 9 wildlife cameras,

o Photography of caribou, fisher, sandhill

crane, deer, wolf and bear,

o Track count intersects were conducted


Novermber

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Participation in Regional Initiatives

•

Harvest will join appropriate Regional Initiatives and will continue to review in this regard

o Cumulative Environmental Management Association (CEMA)

o Wood Buffalo Environmental Association

(WBEA)

o Alberta Biodiversity Monitoring Institute (ABMI)

o Alberta Biodiversity Monitoring Program (RAMP)

o Ecological Monitoring Committee for the Lower Athabasca (EMCLA)

o Conklin Area Wildfire Prevention GroupAER Presentation •

Novermber

2013 43

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Non Compliance Issue

•

Harvest was issued 1 low risk notice of non-compliance by AER for failure to notify prior to start of pipeline construction (Oct. 2013)

o Harvest has submitted letter to respond to the notice.

•

Harvest was investigated by AESRD due to a public complaint pertaining to unreported releases.

o The investigation determined the allegations were unsubstantiated.


Novermber

2013 44

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Self Disclosure

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Self-disclosure to AER to notify of licensed pipelines to remove line segments which were not constructed.

•

Self disclosure to AER of changes to pipeline licenses to change piping material to duplex stainless steel (31803) in place of

carbon steel for produced gas pipeline.


Novermber

2013 45

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Statement Confirming Compliance

•

Harvest is currently in compliance with all regulatory approval conditions related to the development of the BlackGold

Initial

Project.


Novermber

2013 46

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Amendments to the Approvals

•

Harvest obtained the approval for amendment of Groundwater Monitoring Program pursuant to condition 4.6.4 of EPEA Approval No. 246984-00-0 (Aug. 2013)


Novermber

2013 47

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Future Plan -

Regulatory

•

Application to amend Alberta Environment and Sustainable Resource Development Approval No. 246984-00-00 for Project Expansion is amended as 246984-00-02 December 5, 2013.o CPF Facility Modificationso Well Pad Modifications


Novermber

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2100, 330-5th Avenue SW CalgaryAlberta Canada T2P 0L4 T: 1-866-666-1178 F: 403-265-3490 E: [email protected]

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Drainage Patterns


Novermber

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103

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113

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106-N

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110 107109

106-E

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108

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AA

JJ

BB

CC

KK

EE-

N DD

GG

II

EE-S

FF

HH

101102-S

102-E

BlackGold Project Annual Performance Project Annual Performance - ... AER Presentation ... T24 T23...

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