Shale gas field development planning under production profile uncertainty

In shale gas field development, the major endogenous uncertainty comes from the production profile of candidate wells and its realization is dependent on the development decision. In this work, we apply multistage stochastic programming to address the shale gas field development planning problem under production profile uncertainty. Business realities such as budget limit and uncertainty resolution delay are also considered in the proposed model. To solve the multistage stochastic model, a Lagrangean decomposition method and a heuristic method are proposed. Computational results demonstrate the efficiency of the proposed methods on examples that are otherwise intractable. The optimal development strategy from the proposed model is analyzed under different levels of uncertainties. Different cases are further tested to figure out the impact of budget and resolution delay on development decisions.