Canadian company Ivanhoe Energy has teamed up with FPSO specialist SBM Offshore (SBM) to form a global strategic alliance combining their respective expertise to develop heavy crude floating, production, upgrading, storage and offloading vessels (FPUSO’s).
The two companies are combining their respective technologies and experience to produce a first-of-its-kind design for offshore facilities that they intend will economically produce and upgrade heavy oil from offshore fields with crude oil quality down to 10°API gravity, or lower.
This therefore potentially includes a number of UK North Sea discoveries currently sitting on the shelf because of a lack of effective means of exploiting them.
“We expect this combination of technologies to become the pre-eminent method for producing and upgrading heavy oil at offshore locations around the world,” said Michael Wyllie, SBM chief technology officer.
Industry experts have estimated that offshore heavy-oil resources exceed 500billion barrels recoverable. The prize is enormous.
Given the global abundance of such oil deposits and depleting conventional oil supplies, this alliance believes that development of an effective floating package could pave the way to significant future production of heavy crudes from offshore.
SBM currently has around 1million barrels of throughput per day from a fleet of 16 production systems in operation world-wide.
Ivanhoe Energy’s Heavy-to-Light (HTL) process is a partial upgrading technology that drastically reduces the viscosity of stranded heavy oil resources and produces a high-quality synthetic crude oil that commands greater value from refineries around the world.
In addition to creating operating efficiencies, Ivanhoe says the technology will greatly improve the economics of heavy-oil development. HTL’s small footprint and modularisation capability makes installation on FPSOs possible.
Moreover, by providing a source of lighter oil on the FPUSO, some of this fluid can be re-circulated back to the subsea wells, providing a potential means of overcoming the flow assurance challenges of subsea heavy-oil wells.
This important feature can be an enabler for heavy-oil field developments, especially those in deep water.
“Ivanhoe Energy and SBM collaborated over the last two years to develop this new concept,” said Dr Michael Silverman, Ivanhoe Energy’s chief technology officer.
“In 2012, with engineering support from AMEC Engineering, we completed the conceptual design of an offshore FPUSO facility that will upgrade up to 60,000 barrels per day.”
The Alliance is exploring a number of potential business models and applications. Given the number of existing and potential FPSOs, this Alliance is another important avenue to commercialise the HTL process in the near term.
Ivanhoe describes itself as an independent international heavy-oil exploration and development company focused on pursuing long-term growth in its reserves and production using advanced technologies, including its proprietary heavy-oil upgrading process.
Core operations are currently located in Canada, the US, Ecuador and Mongolia.