CMG Corporate Overview

Our Business

 Reservoir Simulation Software Development

 Reservoir Simulation Software Licensing
 Specialized Consulting Services
 Customized Training
 Collaborative Research

2
 History

33 Years of Software Development

41 Successive Fiscal Quarters of Profitability

First Profit as a Public Company

First Positive Cash Flow

Initial Public Offering

Established as Research Foundation

2000 2002 … 2009

Fiscal 1997 1998 1999 2001 2008 2010
1978

3
 Employees

 164 Professional Staff

 36 Doctorate Degree
 46 Masters Degree
 54 Bachelors Degree
 28 Other
 Deployment
 84 Research & Development
 45 Consulting, Support & Training
 20 Sales & Marketing
 17 Administrative
 8 IT Support

4
 Where We Are
CMG has more than 525 clients in 55 countries

Calgary, London,
Canada U.K.

Houston,
USA

Caracas, Dubai,
Venezuela U.A.E.

Rio de Janeiro,
Brazil

Head Office - Calgary, Canada 5

 Our Strengths
Leader in EOR & Unconventional Reservoir markets

Thermal Processes Electrical Heating

Combustion
SAGD
(THAICAPRI)

ES-SAGD
Thermal

Cyclic steam
injection
Continuous steam injection

6
 Our Strengths
Leader in EOR & Unconventional Reservoir markets
Chemical Processes Gel injection
ASP
Low salinity
water injection

CO2 injection
Foam with Asphaltene
Injection Precipitation & Plugging

7
 Our Strengths
Leader in EOR & Unconventional Reservoir markets

Enhanced Recovery in Shale

Unconventional Reservoirs Gas/Oil
Tight Gas

Microseismic
Data Imported
to simulator

CBM / ECBM CO2 Huff’n’Puff

8
Client Base

60 450

400
50
350

Cumulative Client Growth

40 300
New Clients

250
30
200

20 150

100
10
50

0 0
1978 1981 1984 1987 1990 1993 1996 1999 2002 2005 2008
CMG’s Clients in the USA
CMG’s Clients in Canada

Seven Generations
Energy Ltd.

Marengo Energy
Reservoir Modelling
Research Limited
& Management Ltd.
CMG’s International Clients
CMG’s University Clients

Russian State Geological

Ukhta State Technical University Prospecting University

UNIVERSITY
OF Oil & Gas Institute
WYOMING

University of
Baghdad
Annual Software License Revenue
Software license revenue
($thousands)

Annuity Maintenance Perpetual

$45,000

$40,000

$35,000

$30,000

$25,000

$20,000

$15,000

$10,000

$5,000

$0
2006 2007 2008 2009 2010 2011
 Products
IMEX = 3-phase, 4-components Black Oil Simulator

GEM = 3-phase, n-component EOS Compositional Simulator

STARS = 4-phase, n-component Thermal/CEOR Simulator

WINPROP = PVT Phase Behavior Characterization

BUILDER = Simulation Model Creation/Editing

RESULTS = X-Y Plots, Grid Visualization & Data Extraction

LAUNCHER = File Management & Job Scheduling

CMOST = History Matching, Optimization, Sensitivity & Uncertainty Analysis

15
 IMEX Applications

 Primary recovery
Black Oil & Volatile Oil
Dry & Wet Gas
Gas Condensate
 Secondary recovery
Waterflooding
Polymer Flooding
Dry Gas Injection
Pseudo-miscible Displacement
 Gas Storage
Abandoned Gas Fields
Aquifer Storage

16
 IMEX Applications

 Naturally Fractured Reservoirs

 Gas Oil Gravity Drainage (GOGD)
 Explicit Modelling of Hydraulically fractured wells with non-Darcy flow &
Compaction
 Frac Packs (short, highly conductive fractures in Unconsolidated reservoirs)
 Single Plane Fractures (in “tight” reservoirs)
 Complex Fracture Networks (in “shale” reservoirs)
 Coupled Surface Facilities
 Branched surface networks using hydraulics tables or FORGAS
 Looped surface networks coupled to GAP, METTE or Avocet IAM

17
 GEM Applications
 Secondary Recovery
 Miscible & Immiscible gas injection (CO2, N2, Sour Gas, Flue Gas) in
Continuous, WAG and SWAG modes
 Gas condensate production with dry/lean gas cycling to recover liquids
 VAPEX heavy oil recovery (isothermal and thermal)
 CBM & Shale Gas Production
 Multi-component desorption/adsorption, diffusion & coal
swelling/shrinkage
 Gas Storage
 Abandoned Oil Reservoirs (to model light oil/condensate recovery)
 Tracking gas composition
 CO2 & Acid Gas Sequestration
 Oil reservoirs, Saline aquifers & Coal beds (ECBM)
 Geochemical reactions

18
 GEM Applications
 Asphaltene modelling during primary and secondary recovery
 Precipitation, Flocculation, Deposition & Plugging
 Naturally Fractured Reservoirs
 Gas Oil Gravity Drainage (GOGD) in naturally fractured reservoirs
 CBM & Shale Reservoirs
 Explicit Modelling of Hydraulically fractured wells with non-Darcy flow &
Compaction
 Single Plane Fractures (Vertical & Horizontal Wells in Tight reservoirs)
 Complex Fracture Networks ( Vertical & Horizontal Wells in Shale reservoirs)
 Coupled Surface Facilities
 Branched surface networks using hydraulics tables and FORGAS
 Looped surface networks coupled to GAP and PIPEPHASE
 Coupled Geomechanics
 GEOMECH

19
 STARS Applications
 Thermal EOR
 Hot water flooding
 Steam flooding & Cyclic Steam Stimulation
 SAGD & ES-SAGD
 In-Situ Combustion (LTO & HTO)
 In-Situ Conversion of Oil Shale (Shell ISC process)
 Chemical EOR
 Emulsions, Gels, Foams
 ASP, SP, ASG (foam surfactant)
 MEOR
 LoSAL waterflooding
 Brightwater polymer flooding
 Gas Storage
 Salt Cavern Storage

20
 STARS Applications
 Naturally Fractured Reservoirs
 Steam Oil Gravity Drainage (SOGD) in naturally fractured reservoirs
 Cold Heavy Oil Recovery (CHOPS model built with AITF)
 Natural Gas Hydrates
 Geothermal
 Complex Thermal Wellbore Completions
 Discretized Wells (transient, segregated flow of steam, oil, gas & water in
single tubing horizontal wells)
 FlexWells (transient, segregated flow of steam, oil, gas & water in multiple
tubing, undulating wells)
 Coupled Surface Facilities
 PIPEPHASE
 Coupled Geomechanics
 GEOMECH

21
Some of the physical phenomena we can model

22
Some of the physical phenomena we can model

Used to model changes in phase viscosity

when a key component is added (e.g. polymer)

Used to model non-Newtonian behavior of

injected fluids
 shear thinning
 shear thickening
 combined model
 tabular input model

23
Some of the physical phenomena we can model
Some of the physical phenomena we can model

 Compaction/Rebound
 Subsidence
 Dilation /Recompaction
 Elastic/Plastic Deformation
 2D and 3D geomechanical formulation
 Stress effects on Porosity & Permeability
 Geomechanics in Naturally Fractures models
 Geomechanical grid independent of flow grid

25
Some of the physical phenomena we can model

Asphaltenes precipitation

STARS allows modelling of first

order, rate-dependent reaction
kinetics for recovery processes that
involve reactions between
components in fluids (i.e. reservoir  Gels
and injected) and in the formation  Foam
(i.e. clays and other minerals).  Microbes
 Foamy Oil
Reaction rates can depend on tem  In Situ Combustion
perature, component concentration,  High temperature oxidation
permeability and velocity.  Low temperature oxidation
 Fine Migration
Examples include insitu-combustion,  In situ upgrading
cEOR, in-situ foam generation,
 Wax and asphaltene precipitation
degradation & regeneration,
emulsions, solids, etc.
26
Some of the physical phenomena we can model

Used to represent Wettability and

Residual Oil Saturation variation with
phase composition
Krg = 1.00
Interpolation can be a function of
component concentration, capillary
Krg = 0.01
number and/or interfacial tension.
 pH changes
 Miscible fluids
 Flux velocities ()
 Composition changes

XGas Total = Xw en fase gaseosa + XSoln-Gas en fase gaseosa

27
Some of the physical phenomena we can model

Ty = 100 ºF

T = 617 ºF

SwirrT > SwirrTy

T = 617 ºF
SorwT < SorwTy
KrwiroT > KrwiroTy
SorgT < SorgTy Ty = 100 ºF

28
Advanced Well Modelling Features

A fully coupled mechanistic model that

calculates the transient segregated flow of
multi-phase fluids and heat within the wellbore
and between the wellbore and the reservoir.
 Transient flow calculations Z
Tubing Anular
 Heat loss to formation Y

 Fluid segregation calculations

Selective dual injection
 Friction pressure losses
 Multiple flow regimes
Steam circulation (i.e. SAGD)

Hot diluent injection

29
Advanced Well Modelling Features

Extends Discretized Well model features to

wells with up to 3 concentric tubing strings
inside the wellbore plus allows for undulating
wells that connect with more than one reservoir
layer.
 Transient flow calculations
 Heat loss to formation
 Fluid segregation calculations
 Friction pressure losses
 Multiple flow regimes
 also models Flow Control Devices
Tubing 2
Tubing 1

Annular

WHOC 2009-308 30
Advanced Well Modelling Features

Used to specify actions that will be

implemented when a condition is achieved
during the simulation forecast period.
 Can be applied to:
 wells, groups, layers, sectors, field, etc.
 Conditions [ > or < ]
 Rate, pressure, concentration, saturation, etc.
 Actions
 shut-in, voidage replacement, drilling/workovers, etc.

31
Advanced Simulator Performance Features

Ideal Blue old Blue new CMG

32

28

24

Speed Up
20
The objective is to reduce the simulation 16
run time significantly without reducing the 12

calculation accuracy 8

Shared Memory 0
0 4 8 12 16 20 24 28 32

CPU's

 Any model can be parallelized regardless the

grid complexity and well configuration or
location
 Multimillion cell models
 Excellent Speedups
 Efficient domain manipulation

32
Advanced Simulator Peformance Features

Steam Flood

Simulator changes the block size automatically

based on rate of change of key parameters as
specified by simulation engineer.

 Processes where small cells are required

 Use small cells where needed and big cells elsewhere
 Dynamic change based on:
ASP
 Temperature, Saturation
 Global Mole Fraction SAGD
 Phase Mole Fraction (o, g, w)
 Fluid Enthalpy
Pressure
 Effective when an interface is present
 Combustion: speed up 5-7
 SAGD: speed up 2-5
 VAPEX: speed up 2-4
 Water Flood: speed up 2-4

33
Advanced Simulator Peformance Features

Powerful combination of parallel Ideal Blue old Blue new CMG - ParaDyne
32
processing and Dynagrid features that
28
multiplies the simulation time speedup
24
effect!

Speed Up
20

16

4.52 Hardware and Dynamic Gridding 12

4.32
3.90 8
4 CPU 1.65GHz POWER5 AIX 4 CPU 2.4 GHZ Opteron Linux

2 CPU 3.6 GHz Xeon (EM64T) Win-64 16 CPU 1.9GHz POWER5 AIX 4
3.29
0
0 4 8 12 16 20 24 28 32
2.33
2.22
2.16 2.12 CPU's
1.95
1.62
1.27 1.17
SAGD: 3.6 Increase with Parallel
1.04
x 3.6 Increase with Dynagrid
0.64 0.61
0.35
12.9 Increase with Paradyne

Serial Dynagrid Parallel Paradyn

34
 Thank You!

Visit our web site at www.cmgl.ca 35