Understanding Horizontal and Vertical Wells
Updated: Jul 22
When most people think of an oil and gas well, they often picture a well that goes straight down into the ground. While that remains a widely used method, advances in drilling techniques and technology have enabled operators to access hydrocarbon resources in more efficient ways. One of the most significant developments has been the adoption of horizontal drilling.
So, what is the difference between a vertical and a horizontal well? And how do operators determine which approach to adopt?
Vertical Wells
A vertical well is drilled straight down into the ground until it reaches an underground reservoir. As the traditional method of oil and gas extraction, the drilling path is relatively straightforward and it only accesses reserves that are located directly underneath the well.1
The primary advantage of this drilling method is its simplicity. Vertical wells are generally less complex to construct. This can translate into lower equipment and labour costs, as well as shorter time required to extract the available reserves.
However, when the reservoir extends over a large horizontal area, relying solely on vertical wells may be less efficient as multiple wells may be required at different points on the surface to access the oil efficiently, which increases development costs and surface footprint of operations. It is not typically used in unconventional, tight oil and gas formations.2
While drilling wells vertically as the sole method of oil extraction has become less common in recent years as conventional oil reservoirs mature, vertical wells continue to play an important role in field development and exploration. In fact, every horizontal well begins with a vertical well before the wellbore is gradually steered to follow the reservoir.
Horizontal Wells
A horizontal well is drilled at an inclination of more than 80 degrees from a vertical wellbore. The horizontal well technique is typically used where the shape of the reservoir is abnormal or difficult to access. By increasing contact with the reservoir, horizontal drilling can significantly improve production rates and enhance overall resource recovery.
Unlike the vertical well which travels straight down to the reservoir, a horizontal well is drilled in the same manner before gradually changing direction at the target depth. Once the well reaches the reservoir, it is carefully steered to continue horizontally through the reservoir. This allows a much larger portion of the reservoir to be accessed from a single well, enabling higher oil or gas production than the vertical well. It also permits access to subsurface reservoirs that are not accessible from directly above.3
However, these advantages come with greater technical complexity. Horizontal wells require more advanced drilling techniques and can cost up to three times more to drill than vertical wells. While the upfront investment is higher, the improved production and recovery often outweigh the additional costs, resulting in stronger project economics over the life of the field.4
Choosing the Right Approach
In the energy industry, there is no one-size-fits-all solution. Ultimately, the decision to drill vertically or horizontally depends on several factors, including geology of the reservoir, characteristics of the resource and economics of the project. By selecting the most appropriate approach for each field, operators can maximise resource recovery, improve operational efficiency and ensure the responsible development of energy resources.
Sources:
1 22 July 2022, Investopedia, Vertical Well: What It Is, How It Works, Example
2 14 April 2020, CFI, Vertical Well
3 14 October 2020, CFI, Horizontal Well
4 Energy Education, Horizontal Well
