Just a few weeks ago, Weatherford’s well test facility at Aberdeen Science & Technology Park was dominated by a 220-tonne, 33.5m (110ft) tall bright yellow beast of a thing.
Some seven years and $100million since development work on the subsea well remote intervention technology started at Expro Group, the AX-S system will soon be in its element, on shake-down intervention work for BP, which has been a high-profile supporter of the project since inception. This should start during Q3 this year.
AX-S is one of two remote intervention systems developed for overhauling subsea wells – the other is Norwegian. While the latter reached the marketplace earlier, this appears not to worry Graeme Coutts, executive chairman of Expro. He says there is room for both and that there may be a market for about 30 intervention suites, based on the current subsea well population. The plan is to build an AX-S stable for hire and to offer them packaged with an appropriate offshore support vessel capability, starting with a link-up with Seacon of Norway, which is initially involved in this year’s offshore trial for BP.
Coutts told Energy: “I think the reason why the thing has been developed is pretty clear, though timing is perhaps more of a challenge. I’m still not absolutely sure that we have that bang on because the industry has still got to appreciate what the intervention means for deepwater/subsea wells.”
He expressed the hope that operators would be quick on the uptake, given the close involvement of BP throughout the development of AX-S.
“The industry is ready for a subsea technology shift and our view is that, with customers spending huge amounts of money on subsea wells and with the future of much offshore production likely to be off the continental shelves, especially for the IOCs, technology like AX-S will be required one day.”
Expro boss Graeme Coutts added: “In the 1990s, there was no intervention capability. What you have to remember with subsea wells is that, in the late ’80s/early to mid ’90s, the driver on drilling and completing such wells was they would not require intervention.
“Their economics were based on the fact that the developer would recover only the primary amount of oil … 30% at best. In which case, because these wells tended to be individually prolific in their ability to produce, payback was not in doubt.
“Its different now. Everyone can now understand that, with going into deeper and deeper water and with the cost of rigs, the cost of constructing wells, coupled with the responsibility to make the most of assets, we end up in a situation where the recovery of hydrocarbons from a well costing, in many cases, much more than $100million is unacceptably low.
“So it is no longer a case of drilling more and more wells; the issue is actually optimising recovery from each.”
Coutts said AX-S was not that different to “any other wireline unit”, except in the mode of deployment – remote subsea.
“It’s simply deploying tools and known techniques that are routinely applied to the recovery of reserves from easy access wells in a cost-effective manner.
“What we’ve done is try to create a technology step-change that allows the introduction of these techniques into subsea wells on a cost-effective basis.”
He said, too, that by the time AX-S had been matured as a technology in a couple of years, the subsea well population will have grown considerably, not least because of the new ultra-deepwater pre-salt plays now opening up offshore Brazil, Angola and other locations.
“There is already a raft of problem wells out there that are still very important to our clients and which will need intervention. But the challenge for us … the prize for Expro … is to move from the reactive well opportunity to the proactive well planning phase, where people understand the value of a tool like AX-S and therefore plan for its future application during front-end development engineering.
“Operators would then be able to raise recoverable reserves estimates in line with anything that you would find with conventional dry trees or easy access wells.”
Commenting on BP’s involvement to date, Coutts said: “Their attitude has been first-class.
“I would never disclose how much cash they’ve put into it. That’s not the issue. They have also dedicated a huge amount of know-how, man-hours and much more.
“They’ve also provided us with marine experts … people who understand the deployment of heavy modules in ultra-deep water. All sorts of skills have been brought to bear from the BP organisation on making sure that this project succeeds.”
Other than trials, how much more needs to be done to get AX-S to market?
“I don’t think we’re looking at a lot more R&D. We would like to think that there are a number of derivative engineering projects on the cards because of everything that we’ve learned about the techniques of remote intervention,” said Coutts.
“So we will keep the commitment of holding our engineering teams together and building our operations teams. We’ve set AX-S up as a separate company from Expro … to give it the focus that it deserves.
“I think we’re over the hump with spending. What we’re looking for now is commitment from our customers.
“We’ve done projections into what we think the market could look like. If you look at the prospects for 2018-20 based on the rate at which new subsea wells are being installed, and if you take a pretty conservative view of interventions, then you will probably find that there is a market for around 20-30 systems.
“That’s probably much more than Expro could build. However, our view is that, once this system gains traction and once the benefits are established and start to get noticed by those responsible for the balance sheets of oil companies, then I think we will see a step-change in the uptake of AX-S.”
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