“This is the way we tell the story about the small pools,” says Chris Pearson, a solutions centre manager at the Oil & Gas Technology Centre.
“It’s a very neat microcosm of the Maximising Economic Recovery (MER) philosophy,” he said. “If we can keep on tying back smaller fields then the industry gets better technical and economic utility and higher operability.”
That prize is counted in billions of barrels and a lot of the input data used by the OGTC comes from the Oil & Gas Authority’s data-pack of October 2016 when the regulator looked at UKCS small hydrocarbon pools.
The research had been pioneered by Subsea UKs National Subsea Research Initiative (NSRI) when under Gordon Drummond’s leadership.
However, OGTC’s small pools lead, Mr Pearson, said no clear themes came out of the two hackathons organised by Mr Drummond. The approach was broad-brush with lots of good ideas and thinking placed on the table at both.
All told, the hackathons attracted 160 delegates and 200 or so ideas were generated.
According to Mr Pearson, there are mor than 420 undeveloped discoveries on the UKCS of which more than 350 are classified as having had some form of engineering. In addition, 160 are currently unlicensed.
There are roughly 3.5billion barrels of oil still to be recovered from this portfolio while the value to the UK is around £135billion.
So, while the pools are small, they represent a large collective prize, as long as efficient, standardised harvesting techniques can be developed and applied.
Roughly 70% of the 350 fields are within a 15-30-mile radius of existing infrastructure. And, as things stand today, that is meat and drink to the subsea industry.
Further out and the technical requirements tend to differ, depending upon reservoir nature.
“In a global context, if you go to the North West Shelf, the industry faces 200-300km step-outs,” said Mr Pearson.
“The reason I mention that is because I see a clear technology-driven direction when we have solved some of our step-out issues which get scaled up to handle these larger step-out issues.
“It doesn’t matter whether its adding or retaining heat in a (subsea) system or taking energy out of a system, it doesn’t matter if its 25km or 250km. The suites of solutions developed will be scalable.”
Roughly speaking, of the UKCS small pools, 70% are less than 10million barrels and all of those 70% are within tie-back distance.
And if we take 15-ish miles as being a benchmark then that captures a sizeable proportion of the 3.5billion barrels target opportunity.
That naturally drives the industry to finding subsea solutions rather than installing more surface facilities, and then tying back to existing infrastructure.
It’s a very neat microcosm of the MER philosophy. If we can keep on tying back smaller and smaller fields then the industry gets better technical and economic utility and higher operability.
In geographic and geological terms thus far, the distribution is as follows:
Southern North Sea:
- Unlicensed discoveries, low-permeability reservoirs (tight gas), low volumes, ageing infrastructure, off-spec gas, salting, and imaging of deep targets.
Central North Sea:
- Central Graben Area: Fragmented ownership, technically challenged (heavy oil, HPHT), multiple competing export options, and imaging of deep targets.
- Quad 30: Broad range of infrastructure ages, high prospectivity (NPNT/HPHT) but low exploration activity, and low-permeability reservoirs (chalk).
Moray Firth Basin:
- General: Heavy oil, HPHT, high H2 S and CO2 , low-permeability reservoirs, and unlicensed discoveries.
- Quad 15: Drive efficiencies through integrated “area programme” of exploration and development activities.
- Outer Moray Firth: Hubs strategy to attract Third Party business, leading to optimal plans for critical infrastructure.
Northern North Sea (East):
- Late life assets, gas blowdown, heavy oil, and constrained persons on board.
West of Shetland:
- Harsh environment, gas export and deep water, and imaging of deep targets.
“There also needs to be a 50% cost reduction by 2025; 50% of the pools are to be under development by 2030,” said Mr Pearson.
“But, with global economics being outside our control, we can’t help with the prioritising of investment though we can make sure that there is no technical reason why companies can’t develop such reserves.
“Imagine a world where we can operate quite comfortably at $30 per barrel and make money. That’s the objective at OGTC.”
Industry has been here before. The conversation about small pools was very similar in the 1990s and it was the economic climate of the oil industry that drove the initiative. Today’s situation is a different cycle and more critical to the future than back then; also with many more mini assets in the portfolio.
One thing that EV readers should not forget is that the industry has been here before. The conversation about small pools was very similar in the 1990s and it was the economic climate of the oil industry that drove the initiative. Today’s situation is a different cycle and more critical to the future than back then; also with many more mini assets in the portfolio.
It happens that Mr Pearson, then with Stolt Offshore, was involved in Talisman’s tie-back of its tiny Beauly asset, which was a single-well, 3million barrels tie-back of 3miles to the Balmoral floating production unit. It came onstream in 2001.
The approach was simple. The appraisal well drilled on the mini-field was converted to a producer and the time taken from FID to first hydrocarbons was just over 10 months.
Mr Pearson said: “The reason why I point this out is to provide context to what we’re trying to do today as so many of these small pools will be single well tie-backs, and that is driving the technology themes that we have to develop. Also to be considered are the ways of working – the engineering, codes and so on.”
Happenstance, much of the thinking and perhaps most of the technology needed to enable the offshore industry to change its game is already salted down, in part because of efforts made 20 or so years ago. But it’s apparently mostly not being utilised for whatever reason. OK, so how’s the industry going to make it work properly this time?
Mr Pearson said: “50% cost reduction means we’re going to have to look at energy transfer, process solutions for all hydrocarbons, new development options, the regulatory and commercial framework, recovery factor and so-forth.
“If we can double recovery factors overnight then, regardless of commodity price, we will make many more proposed developments a lot more attractive.
“That’s the simplistic description.
“So what does that drive us down to?
“For a start we’re going to have to think in terms of clusters by putting three or four of these small fields together; then clearly one can achieve a better economic answer for their development.
“It would become possible to develop a portfolio of clusters-based work that should prove attractive to groups of operators, development contractors, drillers and so-forth.”
In the Moray Firth there are currently 43 discoveries in 11 potential clusters while, in the Central North Sea, there are 64 discoveries grouped in 18 potential clusters.
Said Mr Pearson: “If you look at the way in which the industry handles gas and integrates with other industries such as offshore power generation (offshore wind), in the Southern Gas Basin that opens the way to more than 40 small pools being developed.
“If one looks at the mass of infrastructure available in the Gas Basin and if you can have a low-cost way of tying some of those mini gas fields back into existing infrastructure, overcome the back-out issues in terms of bringing relatively high pressure gas into low pressure evacuation systems, and then, for power, perhaps convert to offshore electricity direct from the National Grid via offshore windfarms, then all sorts of possibilities emerge.”
“There are innovative ways of solving the economic problems through lateral thinking such as the above, but also building slightly different suites of technologies that are complementary and certainly not exclusive.
“To that aim I guess I can say that we’re working closely with the Offshore Renewable Energy (ORE) Catapult; and not just looking at fixed offshore wind, but wave and tidal, current and floating wind.”
An aside, among pioneering SMEs looking for solutions to subsea power augmentation is EC-OG (East Coast Oil & Gas Engineering) which is among the first companies that OGTC has awarded funding to.
In August, is was announced that EC-OG would, together with OGTC, undertake a front end engineering design (FEED) study for its subsea power hub covering refinement of the design, deployment procedures, and de-risking of the installation and operational phases for the device.
In September, the company launched its system commercially at Offshore Europe 2017.
The power required to run a downhole well is a lot less if a renewable energy device such as the one being developed by EC-OG can be co-located on the seafloor. The requirement becomes kilowatts as opposed to megawatts stuff of conventional developments with gas turbine sets on the platform.
And there’s more.
“When it comes to rapid tie-backs and halving the cost, if you can do away with the (power and controls) umbilical and utilise remote chemicals and corrosion inhibitor injection, and obtain the power needed from a tidal current device, then it doesn’t matter how far a small pool is away from the host facility or hub, you (Mr Operator) have already made a huge dent in the capital and operating and even abandonment costs of such small pools,” says Pearson.
“Production tubing can be run directly or indirectly back to a hub. But you no longer require the copper in the ground, as it were, as the electrical infrastructure people describe it.
“That then takes you to another place. It means that you as an operator now have distributed power networks, which is a step towards having a smart grid.
“We’re (OGTC) ambivalent about how energy requirements are satisfied … wind, wave, tide, current; and the capacity exists to store that energy.
“It means providing command and control functionality to subsea hydrocarbons production systems (oil or gas) can be hugely reduced.
“We put all of this subsea thinking into a piece of work called Tie-back of the Future that has been presented at various technical forums and for the 30th UK Offshore Licensing Round in August last year.”
Mr Pearson said that the gradual shift towards fewer people offshore as a result of more and more remote command from the beach would bring its own benefits too, not least in terms of personnel onshore and the elimination of offshore allowances.
As the industry regularly tells itself, time is of the essence, it can’t go reinventing the wheel. So how does OGTC build the necessary momentum for change and keep it practical?
“Everything we’re doing is connected,” said Mr Pearson. “If we’re doing a piece of study-work it’s with a particular outcome in mind.
“We’re also being very circumspect about how we spend our money, recognising there is no one silver bullet that we could chase and which would suddenly, miraculously unlock solutions that work.
“We’ve analysed technologies that we feel are there or thereabouts already.”
This was our original thinking:
- Looking at flow management; infrastructure safety zones … do we have to protect for over trawlability and can we work with fishermen;
- Can we reduce capital and lifecycle costs:
- Examine the potential reuse of pipelines and looking at carbon fibre as an alternative to steel;
- Consider umbilical-less systems;
- Also refurbishing and reusing subsea equipment and other systems on fields whose life may be only three or so years and so-forth.
“We’re working with Zero Waste Scotland to see what we can do. Basically, rather than considering decommissioned equipment to be scrap, can it not be re-deployed after overhaul? And what about employing additive manufacturing equipment?
“We’ve run a competition called Tieback of the Future. We want a more circular (offshore industry) economy.
“We want to design for disassembly and re-use, not decommissioning.
“We know the economic arguments are valid. Other industries have seen it and we can see that as well.”
But finally, have the operators finally learned that the future lies not in proprietary but standardised systems and technologies.
“That’s a question for the operators rather than Chris Pearson!” comes the response.
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