Residual oil zones (ROZ), the portion of an oil reservoir below its traditional producing oil-water contacts, can hold large volumes of previously undocumented and undeveloped domestic oil resources. The first comprehensive report on this topic, “Stranded Oil in the Residual Oil Zone,” examined the origin, nature and presence of ROZ resources.1 The second report “Assessing Technical and Economic Recovery of Resources in Residual Oil Zones” provided a reservoir simulation-based study of applying CO2-EOR to establish the feasibility of recovering oil from residual oil zones in five major oil reservoirs2. This third report, “Technical Oil Recovery Potential from Residual Oil Zones: Permian Basin”, provides an in-depth documentation of the in-place and recoverable ROZ potential from this important domestic oil production basin.

A. Overview of ROZ Recovery Potential. Because of their low to moderate oil saturation settings, ROZ resources are not economic when using primary or secondary oil recovery. As such, the traditionally domestic oil wells have traditionally been completed at or above the oil-water contact (the first observance of water) and thus consistently above the residual oil zone. Outside of a small group of forward- looking operators, little is still known about the ability to successfully identify and produce the ROZ resource. However, in the current economic climate, with depleting domestic oil reserves and operators’ desires to extend reservoir life, ROZ resources offer an important new source of domestic oil production. Because of this, there is growing interest in further understanding the resource size and recoverable oil potential in the relatively thick (100 to 300 feet) residual oil zones located beneath the main pay zones of oil reservoirs.

Carbon dioxide (CO2) enhanced oil recovery (EOR) has emerged as a viable technique for recovering residual oil left behind (“stranded”) after waterflooding, mainly in light oil reservoirs below 3,000 feet in depth. Yet, the oil saturation in the transition

1 Melzer, S., (2006) “Stranded Oil in the Residual Zone.” U.S. Department of Energy Report.
2 “Assessing Technical And Economic Recovery Of Oil Resources In Residual Oil Zones”, Advanced Resources International, February 2006, U.S. Department of Energy Report.

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(TZ) and residual oil zones (ROZ) of a reservoir is often similar to the oil saturations left after waterflooding. As such, with progress in CO2 flooding technology and availability of affordable supplies of CO2, the oil resource in the ROZ could readily become a feasibility target.

Further confirmation of this new oil resource potential is provided by the various residual oil zone CO2-EOR pilot tests currently underway. Two of these pilot tests are operated by OxyPermian in the Denver and Bennett Ranch Units of the giant Wasson oil field. The Denver Unit pilot was the first to target transition and residual oil zones. A third ROZ pilot test, operated by Amerada Hess, is in the Seminole San Andres Unit. This is a 500 acre pilot TZ/ROZ flood underway since 1996. The response from this field pilot test has been most promising, providing an estimated cumulative recovery of 3 million barrels of oil to date, at an oil rate of1,400 bbls/day.3 An expanding CO2-EOR project targeting the ROZ is also underway in the Salt Creek field (by ExxonMobil) involving 36 wells and incremental production of 2,000 bbls/day.4

The information on the operation and performance of these ROZ field pilot projects has been most valuable in calibrating the reservoir simulation-based oil recovery assessments of the TZ/ROZ resource examined by this study.

B. Outline for Report. This report assesses the size of the in-place technically recoverable oil resource from the transition and residual oil zones of the Permian Basin. It first provides a very brief introduction to the oil plays and the major fields with tiled oil-water contacts (OWCs) and TZ/ROZ resources in the Permian Basin. Then, it examines, using a reservoir simulation calibrated streamtube model, the technical feasibility of recovering this previously by-passed TZ/ROZ resource using CO2-EOR.

3 “2004 Worldwide EOR Survey,” Oil & Gas Journal, April 12, 2004, pp. 53-65.
4 Wilkinson, J.R., Genetti, D.B., and Henning, G.T., “ Lessons Learned fro Mature Carbonates for Application to Middle East Fields”, SPE 88770, presented at the SPE 11th Abu Dhabi International Petroleum Exhibition and Conference, October 10-13, 2004.

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C. Definition of Terms. The term residual oil zone (ROZ), as used in this study, also includes the more commonly known transition zone (TZ). Although often used interchangeably, the two terms describe different portions of an oil reservoir. All oil reservoirs have a transition zone, an interval tens of feet below the traditionally- defined producing oil-water contact (OWC) where the oil saturation falls rapidly. The thickness of this interval is controlled by capillary forces and the nature of the rock’s “wetting phase”, with lower permeability oil-wet rocks providing thicker TZs and water- wet rocks providing thinner ones.

While all oil reservoirs have a transition zone, not all have a residual oil zone, as specific hydrological or geological conditions need to have occurred to create a ROZ, as further discussed below. The great bulk of the ROZ will be at a residual oil saturation (similar to that after a conventional waterflood), tapering to near zero oil saturation at the base. A typical reservoir oil saturation profile is shown in Figure 1, Oil Saturation Profile in the TZ/ROZ: Adopted from Wasson Denver Unit Well.

The transition zone (TZ) is the upper portion of the reservoir interval just below the traditional OWC and produces both water and oil. The residual oil zone (ROZ) is generally the middle and lower portions of the reservoir interval below the traditional OWC and upon initial completion produces primarily water.

The reason that both terms – – residual oil zone (ROZ) and transition zone (TZ) – – are used in this report is to bring special attention to the abnormally thick ROZs that can exist for reasons beyond normal capillary effects. For example, if the original oil trap possessed a thick oil column in its geologic past and the lower portion of this oil column was tilted and/or invaded by water, this lower reservoir interval would have an oil saturation much like that of the residual oil saturation in the swept zone of a water flood. In certain geologic settings, oil reservoirs can have an anomalously thick ROZ and thus could contribute considerable additional CO2-EOR reserves.

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