American Oil and Gas Reporter - November 2017 - 60

SpecialReport: Oil & Gas Computing
Using pressure measurements as the
primary input data, real-time analysis
allows the engineer to quickly determine
whether a pressure change is related to
pipe friction or a formation response.
"Maybe a treatment is about to screen
out and we need to cut an interval treatment short, or maybe we should add
proppant and fluid volumes or switch
to a different mesh size. Real-time analysis is the only way to get the answer,"
Poulson explains. "The goal is to let
real-time data tell us how to treat each
well as opposed to trying to force the
same design on every well."
While real-time workflows add some
incremental cost to completion operations,
Poulson says his company's experience
over the years underscores the technology's
potential to save money and bring in
better wells. "On a multiwell pad with
70 or more total stages, real-time analysis
can save hundreds of thousands of dollars
while enhancing well productivities," he
contends. "That is the true value for the
operator."
Mega Storefront
The ability to diagnose and tailor stimulation treatments on the fly is pushing
proppant supply to become more responsive with a delivery infrastructure capable
of functioning on a just-in-time inventory
management basis, observes Jeff Bartlam,
president and co-founder of Shale Support

Announced Dune Sand Mines
1. Alpine Silica - West Texas 1
2. High Roller - High Roller Sand
3. Badger Mining - Mine TBN
4. Atlas - Kermit
5. Fairmount Santrol - Mine TBN
6. Hi-Crush - Permian Basin Sand
7. Black Mountain - Vest
8. Black Mountain - El Dorado
9. Preferred Sands - Kermit
10. Lonestar (Vista) - West Texas Sand
11. Atlas - Monahans
12. Preferred Sands - Monahans
13. Schlumberger - Mine TBN
14. U.S. Silica - Crane County Sand
15. West Texas Sand Co. - Mine TBN
16. Aequor Mgt. Bruno Minerals
17. U.S. Silica - Lamesa
Unimin - Mine TBN (Undisclosed Location)
SmartSand - Evaluating Location

in Picayune, Ms.
This real-time, on-demand requirement
is reflected in the design of a new generation of transload facilities, such as Shale
Support's 300-acre center under construction in the Permian Basin. With a double-loop track and 40,000 tons of storage,
Bartlam says, the facility is designed to
have the flexibility to accommodate large
orders on short notice.
"The customization of frac treatments
and bigger job sizes mean the supplier
has to have more volume and product
choice ready to deliver," he says.
"Transloads sites are becoming more of
a regional mega storefront, with the proppant selection, storage and delivery mechanisms to allow just-in-time inventory
management."
These logistical challenges are forcing
consolidation in proppant supply, making
the supply chain more dependent on technology, and reinforcing the need for
quality control measures, Bartlam continues. "With the increased amount of
proppant being pumped in each well,
you now need at least 50 rail car spots at
a transload facility to service a well. Not
long ago a client could easily be serviced
with 20 car spots," he recalls. "Given the
lack of spare capacity, suppliers must
have visibility to what is happening at
the well so that when a change is made,
the supply chain can adjust."
The more tightly linked the commu-

If Permian local sand volume reaches 30M Tons/Year...
* 1,200,000 truckloads/yr sand (if all are pneumatic trucks)
* 2,400,00 trips/year
* Requires over 1,000 truck ﬂeet
* More importantly additional drivers

Legend
Active Permian Rig
Frac Sand Mine
Permian Shale Plays
Sand Deposit
Active rigs as of 8/17/2017

By originating proppant in or near resource plays, regional sand mines enable faster
and more responsive logistics, and ultimately, reduce proppant cost. With the U.S. Energy
Information Administration estimating that proppant will account for 15 percent of an
average Midland Basin well's total cost in 2018, a lower-cost proppant supply chain can
have a material impact on pad economics.

60 THE AMERICAN OIL & GAS REPORTER

nication along the supply chain, and the
more storage that exists in proximity to
the well, the better suppliers can react to
unplanned changes to treatment designs,
he emphasizes, adding that visibility
works both ways.
"We are working with customers to
integrate daily supply and demand forecasts. We generate daily reports for sand
on location and sand in route, and integrate
that core-level information so that it flows
directly into customers' systems," Bartlam
describes. "That gives us visibility all the
way to the well site, and gives them visibility all the way to our production silos."
Quality control concerns go along
with increasing volumes of different
grades and types of proppant moving
through transload facilities, raising the
risk of cross-contamination, Bartlam says.
He says Shale Support attaches fabric
tags with scannable barcodes to each rail
car to identify the proppant type, mesh
size, date of origination, etc.
"The scannable element reads into a
cloud-based system," he explains. "A
transload operator can read the tag with a
tablet or smart phone to get all the information on the proppant in the car, what
purchase order it is attached to, where it
is going and when it needs to be there."
He adds that the supervisory control
and data acquisition systems at the company's transload facilities have lockouts
so that when a rail car's tag is scanned
during unloading, proppant is automatically prevented from entering a silo containing a different type or size to eliminate
contamination.
Higher proppant concentrations and
real-time operations also place an even
greater premium on efficient transport
and local storage capacity, Bartlam adds.
"Shipping by unit train lowers cost and
reduces time to the delivery point, sometimes by several days compared with
manifest shipment," he says. "Also, a
huge amount of storage is needed on location for proppant and every other product
as the industry moves toward more customized frac treatments."
However, moving storage closer to
the well site adds another proppant handling point, creating more ambient dust
and potentially reducing sand cleanliness.
"We have integrated a new program with
a supplier to provide turbidity testing in
addition to sieve analysis for each rail
car so the customer can know not only
the sand's quality and grain size, but also
its cleanliness," he concludes.

American Oil and Gas Reporter - November 2017

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