Field Development

At California Resources Corporation (CRC), cross-functional teams work in concert and use advanced technologies to optimize the development of oil and gas fields in a sustainable manner. CRC’s rigorous capital allocation process takes into consideration various factors such as wellhead returns, expected cash flows relative to investments and payout metrics to prioritize investments.

Following are descriptions of key activities within the various functions.

Geophysics

CRC has an exceptional 3D seismic library, which covers approximately 4,950 square miles, representing approximately 90 percent of the 3D seismic data available for California. We have developed unique and proprietary stratigraphic and structural models of the subsurface geology and hydrocarbon potential in each of the four basins in which we operate. As a result of our long successful operating history, our extensive exploration programs, our exceptional 3D seismic library and proprietary subsurface geologic models, we have tested and successfully implemented various exploration, drilling, completion and enhanced recovery technologies to increase recoveries, growth and value from our portfolio.

Well Construction

Exploring for and producing oil and natural gas requires drilling wells – often more than a mile deep – to bring oil and natural gas from the targeted underground formation to the surface. Once a well is drilled, steel pipe is placed in the well and cemented in place to isolate, support and protect the casing. Water-bearing zones are cased off, cemented and isolated from hydrocarbon-bearing zones to protect groundwater aquifers. The cemented pipe keeps the wellbore open for the life of the well and seals the formations that hold the oil and gas. Wells are completed in targeted pay zones in the formation allowing the oil and gas to flow into the well. Removable steel pipe, called tubing, is installed to carry the flow of oil and gas to the surface. The steel pipe, cement, tubing and valves at the surface contain and control the oil and gas.

Drilling

CRC’s experienced drilling professionals use rigorous well design standards, state-of-the-art technologies and optimized rigs and equipment to deliver superior safety and drilling efficiency. CRC has a collaborative process with our drilling contractors and suppliers to select, commission and start up drilling rigs and to promote safety and reliable operations.

Well Stimulation

Well stimulation is a process defined under California law to enable certain production wells to extract more oil and natural gas from the targeted underground formation. Well stimulation is only useful in certain geologic conditions, such as when the oil and gas formation consists of hard or tight rock with little natural permeability. The two primary types of well stimulation are hydraulic fracturing, which uses water, sand and select additives under pressure to create fractures, and acid matrix stimulation, which uses a low concentration solution of acid in water under lower pressure to dissolve minerals that have been deposited within the oil and gas formation.

Well stimulation is used less commonly in California than in other states, and typically with less water and less energy. For example, in 2019, CRC completed about 8 percent of the wells we drilled using well stimulation, all with hydraulic fracturing. CRC did not hydraulically fracture any wells in 2020. In many parts of New Mexico, North Dakota, Pennsylvania or Texas, by comparison, 100 percent of the wells undergo hydraulic fracturing.

Where well stimulation is used in California, it typically occurs once in the targeted oil and gas bearing zone during the production well’s 40-year life. The actual stimulation process generally takes only a few hours, with a few days before and after the job for equipment set-up, testing, regulatory inspections, fluid recovery and demobilization before the well is put on production. Used safely and effectively by CRC’s operations and contractors for many years, hydraulic fracturing has been a routine practice in the oil and gas industry for seven decades.

For more information about CRC’s use of well stimulation techniques, please visit our Well Stimulation page.

Reservoir Management

Reservoir conditions change as commingled oil, natural gas and water are extracted. To manage oil and gas reservoirs effectively, CRC’s multi-disciplinary teams collect and analyze data to optimize production and reserves. The data, much of it from automated systems, includes pressure, temperature, production and injection rates, artificial lift efficiency, well logs and downhole conditions. Continuous monitoring enables CRC’s professionals to make prompt adjustments that improve oil and natural gas production.

CRC also uses performance prediction tools such as reservoir simulation and compares the results with actual performance. Based on the findings, opportunities are identified to fine-tune field development, enhanced oil recovery programs, artificial lift design and well servicing plans.