EXPLORATION | DRILLING | PRODUCTION AUGUST 2017

TECHNOLOGIES

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31 13

03 Comment
Contents 31 rig design Q&A
August 2017
Volume 10 Issue 08

Oilfield Technology invited Nabors and

Herrenknecht Vertical to share their insights on
rig design. Their feedback covered areas including safety systems, automation
05 World news technologies, jack-up designs, and more.

10 Whats new in the North Sea? 37 Going wireless

David Bizley, Oilfield Technology, takes a look at the challenges and Kevin Buchan, Tendeka, UK, explores wireless intelligent completion
opportunities facing the upstream industry in the North Sea. solutions for digital oilfields.

13 In-built adaptability 41 Keeping clean

Jayesh Jain, Anthony Phillips, Greg Ricks, & Roy Ledgerwood, Gordon Hunter, Intelligent Drilling Tools, UK, examines an intelligent
Baker Hughes, show how new self-adjusting bit technology can circulate and disconnect tool, designed to provide a solution for hole
mitigate drilling dysfunctions and enhance performance. cleaning management and a reliable outcome should a stuck pipe
situation occur.
19 Keeping up with completions
Dustin Lyles and Spencer Hendrix, PDC Logic, USA, examine new 45 Weathering the storm
bit designs aimed at keeping up with advanced completions Jim Menard, The Weather Company, explains how on-platform weather
technologies and increasingly complex operations. radar is critical to offshore safety and efficiency.

22 Extending the life of wells 47 Cutting contingency costs

Cody Roy, Blake Arabie, Luk Servaes and Katie Poch, Morten H. Emilsen, Add Energy, Norway, and Brett Morry,
Franks International, USA, consider ways of safeguarding well Trendsetter Engineering, USA, review the development of a 15 Ksi kill
integrity. spool.

27 A new direction 50 Overcoming offshore obstacles

Peter Kaufmann, OTTO FUCHS Drilling Solutions, Germany, considers Steve Hiner, CLARCOR Gas Turbine Filtration Division (a PARKER
how lightweight aluminium alloys could pave a new path for drilling company), UK, explains how turbines can be protected using next
in challenging environments. generation high velocity filters.

53 Digital insight
Paul Rijks, Choicce Associates, UK, and Mason Linden, Wood Group,
Australia, show how optimising costs, asset integrity and production
while assuring sustainable standards of safety and reliability are key
Front cover when planning integrated activity.
OILFIELD TECHNOLOGY

Rubicon Oilfield International

is breaking new ground with its
EXPLORATION | DRILLING | PRODUCTION AUGUST 2017
56 Data: a powerful tool
composite plug technology. Grant Eggleton, P2 Energy Solutions, Singapore, considers how
predictive analytics and operational intelligence can make oil and gas
The patent pending design of the production more efficient.
AUGUST 2017 | EXPLORATION | DRILLING | PRODUCTION

RzrFRAC Composite Frac Plug

provides a 10 000 psi at 300F 59 From the ground up
anchor and seal using up to 70% Michael Hall, Airbus Defence and Space, UK, explains how satellite
less material than a traditional imagery advances asset integrity management throughout an assets
plug. lifecycle.

With focus on the demands of 62 Ticks all the boxes

the composite plug operation Bill Noble, Verification Technical Authority, Bureau Veritas Marine &
(pump down, anchor & seal, and Offshore Division, UK, discusses why verification should extend beyond
mill up) the RzrFRAC has been legal compliance.
www.oilfieldtechnology.com

designed from the ground up to

be the most efficient plug & perf
completion solution.

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Norway 24th Licensing Round
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 Comment David Bizley, Editor
August 2017
Contact us
david.bizley@oilfieldtechnology.com Editorial
Managing Editor: James Little

T
he implementation of new technology has long played a key james.little@oilfieldtechnology.com
role in the success of the upstream sector and todays highly Editor: David Bizley
david.bizley@oilfieldtechnology.com
pressurised, cost-sensitive industry is no different. Indeed,
Editorial Assistant: Anna Nicklin
despite the challenges it brings, the current lower-for-longer oil price anna.nicklin@oilfieldtechnology.com
environment can be seen as an opportunity; both for companies
offering new, cost-saving technologies and operators looking for ways to
Design
increase efficiency and improve their bottom lines.
Production: Charlotte Reynell
One of the most obvious examples of new technologies being adapted for the oilfield is charlotte.reynell@oilfieldtechnology.com
the use of remotely operated vehicles, such as unmanned aerial vehicles (UAVs or drones) or
autonomous underwater vehicles (AUVs). Whilst such technologies have existed for a while, it Sales
is only in recent years that they have begun to see widespread use across the upstream sector. Advertisement Director: Rod Hardy
For example, UAVs have proven to be highly effective in inspection and maintenance roles, rod.hardy@oilfieldtechnology.com
particularly offshore it is generally far more efficient to use a UAV to inspect the underside of a Advertisement Manager: Ben Macleod
ben.macleod@oilfieldtechnology.com
platform, than it would be to send personnel. To quote DNV GL, which recently conducted its first
offshore drone survey, the inspection of such spaces can be both costly and time consuming,
and even in some instances potentially dangerous. Using drones to visually check the condition Website
of remote structural components can significantly reduce survey times and staging costs, while at Website Manager: Tom Fullerton
tom.fullerton@oilfieldtechnology.com
the same time improving surveyor safety.1
Digital Assistant Editor: Angharad Lock
UAVs, AUVs, etc., arent the only new technologies making life easier for operators. The rise angharad.lock@oilfieldtechnology.com
of Big Data and the so-called Internet of Things is set to bring about significant changes to
the upstream industry over the coming years. One example of how this is already happening is Marketing
GE Marine and Maersk Drillings digital partnership. After positive results on a one-vessel pilot Subscriptions: Laura White
programme, the partnership has been extended and will see GEs SeaStream Insight Marine Asset laura.white@oilfieldtechnology.com
Performance Management (APM) solution implemented on nine units across Maersk Drillings Administration: Nicola Fuller
fleet. The solution is designed to provide real time efficiency reports and performance indicators nicola.fuller@oilfieldtechnology.com

based on data gathered during daily offshore operations.2 The two companies have also worked Reprints:
reprints@oilfieldtechnology.com
together to develop digital twins virtual representations of rig equipment, which are updated
with data from sensors and other equipment. This allows for improved understanding of the
status of various assets, and can be used to detect signs of impending breakdown. Serving as Palladian Publications Ltd,
the basis of a predictive maintenance programme, the virtual twins concept can help potential 15 South Street, Farnham, Surrey GU9 7QU, UK
Tel: +44 (0) 1252 718 999 Fax: +44 (0) 1252 718 992
faults be prevented before they occur. Overall, the expanded partnership is targeted at reducing Website: www.oilfieldtechnology.com
maintenance costs by 20% and increasing drilling efficiency.
However, its not just in the areas of operational efficiency and maintenance that technology
is pushing the upstream industry forward; new systems and technologies are routinely developed
to help with the industrys primary task: extracting oil and gas. Galex Energy Corporations SWEPT
system is one such technology. SWEPT uses acoustic waves to create microfractures in reservoir
rock and thus increase permeability. The technology also creates cycles of high and low pressure,
which encourages the hydrocarbons to flow towards the well.3
Subscription
The above covers just a few examples of how technology is helping the upstream industry Oilfield Technology subscription rates: Annual subscription
meet the challenges it faces today and those that will inevitably arise in the future. The 80 UK including postage/95 overseas (postage airmail). Two
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References by Palladian Publications, GBR and is distributed in the USA

by Asendia USA, 17B S Middlesex Ave, Monroe NJ 08831.
1. DNV GL carries out its first offshore drone survey https://www.dnvgl.com/news/dnv-gl-carries-out-its-first-offshore- Periodicals postage paid New Brunswick, NJ and additional
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digital-partnership-to-drive-industry-transformation
3. Future energy: The technology allowing more oil extraction http://www.bbc.co.uk/news/business-40580058

August 2017 Oilfield Technology | 3

World news August 2017

Westwood Insight: US land rig growth stalls, slowdown

anticipated across unconventional plays In brief
Westwood Insight has provided an overview of an anticipated drilling slowdown across US
unconventional plays: In Halliburtons second quarter earnings call Dave Lesar said, rig count growth Nigeria
is showing signs of plateauing and customers are tapping the brakes. With oil prices under US$50/bbl
According to Reuters, Nigerias national
and oil supply at record levels, expect a pullback in Permian, Eagle Ford, DJ-Niobara, and Bakken
oil company, NNPC, and a university have
drilling activity. The steady increase of horizontal drilling rigs and infrastructure requirements in key
stated that exploration in the Lake Chad
areas of the Permian are causing DUCs to head north for summer.
Basin region will continue despite the
Horizontal rig activity in the Permian increased by 51% year to date in 2017, according to the latest
recent kidnapping of researchers by
Baker Hughes rig count. Throughout the year, drilling contractors brought back the best rigs and crews
suspected Boko Haram members.
to meet E&Ps demand for more efficient drilling operations. Encana, Apache Corporation, Chevron,
Danjuma Gambo, spokesman for the
RSP Permian and others have indicated a move or ramp-up in multi-well pad drilling. Encana expects
University of Maiduguri was quoted as
to drive efficiencies with pad drilling and anticipates larger multi-well pads as a general rule in 2017.
saying that: The Vice Chancellor said
Multi-well pads have steadily increased quarter-over-quarter over the last two years.
the University [...] wont check out of the
Pad drilling offers numerous benefits, including reduced drilling cycle times and smaller
oil exploration in Lake Chad despite the
surface footprints with the possibility for increased frac efficiencies and simultaneous operations.
recent unfortunate incident.
A side-effect of drilling multi-well pads is a longer put-on-production cycle time, since the first well
drilled will not be producing until the last well is completed, in most cases. This additional time
enhances the drilled, uncompleted well count or DUC. Vietnam
Nearly 54% of the DUC wells reside in the Permian Basin. Based on the last two years of Vietnam has reaffirmed its right to drill
permitted wells, Pioneer Natural Resources, Concho Resources, and Anadarko Petroleum account for for oil and gas in its territorial waters,
15% of the DUC backlog in the Permian. and referred to its exploration activities
as a normal business practice. Foreign
Ministry spokeswoman, Le Thi Thu Hang
ExxonMobil earns Global gas supply forecast was quoted as saying All relevant
US$3.4 billion in Q2 2017 to grow 1.4% p.a. by 2030 petroleum activities by Vietnam take
place in waters entirely under the
Exxon Mobil Corporation has announced an McKinsey Energy Insights has released its sovereignty and jurisdiction of Vietnam.
estimated second quarter 2017 earnings of latest Global Gas Market Outlook, in which Vietnamese claims over areas of
US$3.4 billion, or US$0.78 per diluted share, the company predicts that natural gas will the South China Sea conflict with those
compared with US$1.7 billion a year earlier, as represent 23% up from 22% in 2016 of the of China, which claims roughly 90% of
oil and gas realisations increased and refining global energy mix by 2030. The company also the region. China also has conflicting
margins improved. expects total natural gas demand to grow to territorial claims with the Philippines,
These solid results across our businesses ~4300 billion m3 in 2030. Brunei, Malaysia and Taiwan.
were driven by higher commodity prices and By 2030, an additional 175 - 210 billion m3
a continued focus on operations and business of new supply will be needed to meet
fundamentals, said Darren W. Woods, demand. Assuming only the most economic Venezuela
Chairman and CEO. Our job is to grow new projects are built, MEI sees the price According to a senior company executive
long-term value by investing in our integrated of the marginal unit of LNG growing to at Inpex Corp, the companys giant
portfolio of opportunities that succeed US$8 - 8.7/million btu. However, as nearly offshore Ichthys project will begin natural
regardless of market conditions. all LNG demand growth to 2030 comes from gas production towards the end of 2017.
Upstream volumes declined 1% to emerging market customers likely to be more The company had previously
3.9 million boe/d compared with a year price-sensitive, price increases may be more postponed output from the facility
ago largely due to lower entitlements, modest than many would expect. after citing delays in the installation of
while increases from projects and work By 2030, an additional 175 - 210 billion m3 production facilities.
programmes more than offset the impacts of of new supply will be needed to meet The projects FPSO Ichthys Venturer
field decline. demand. Assuming only the most economic set sail from South Korea last month.
During the quarter, the corporation new projects are built, MEI sees the price Once operational, the FPSO will process
distributed US$3.3 billion in dividends to of the marginal unit of LNG growing to and store condensate from the projects
shareholders. US$88.7/million btu in response. CPF before offloading to export carriers.

August 2017 Oilfield Technology | 5

 World news August 2017

Diary dates
DeepOcean acquires BP: Q2 and half year 2017
05 - 08 September, 2017 SeaRov Offshore SAS results
SPE Offshore Europe DeepOcean has acquired French BPs profit for the second quarter
Aberdeen, UK company Searov Offshore SAS and has and half year was US$144 million and
E: oe@reedexpo.co.uk
expanded its presence in West Africa. US$1593 million respectively.
www.offshore-europe.co.uk
Searov is an ROV service provider The Q2 replacement cost (RC) profit
with a strong focus on West Africa. was US$553 million, compared with a loss
09 - 11 October, 2017 The company owns and operates ten of US$2247 million for the same period in
SPE ATCE ROVs from its operating bases in Pointe 2016. After adjusting for a net charge for
San Antonio, USA Noire, Congo and Port Gentil, Gabon. non-operating items of US$215 million
E: service@spe.org Searov has a track record of delivering and net favourable fair value accounting
www.spe.org inspection, maintenance and repair effects of US$84 million (both on a post-tax
and construction support services to a basis), underlying RC profit for the second
15 - 18 October, 2017 variety of international oil companies in quarter was US$684 million, compared
West Africa. with US$720 million for the same period
AAPG/SEG
London, UK Maxime Cerramon, President of in 2016.
E: aapgregistration@thepulsenetwork.com Searov stated, I view this as a great Bob Dudley, CEO, stated: We
www.aapg.org opportunity to continue to build on the continue to position BP for the new oil
successes of Searov and DeepOcean. price environment, with a continued tight
Going forward we will be able to offer focus on costs, efficiency and discipline
24 - 26 October, 2017
our clients more comprehensive and in capital spending. We delivered strong
LAGCOE efficient solutions. Searovs track record operational performance in the first half
Lafayette, USA and experience in West Africa will be of 2017 and have considerable strategic
E: angela@lagcoe.com
well complemented by DeepOceans momentum coming into the rest of the
www.lagcoe.com
experience on larger scale projects, year and 2018, with rising production from
project management and engineering our new upstream projects and marketing
13 - 16 November, 2017 capabilities. growth in the downstream.
ADIPEC
Abu Dhabi, UAE
E: mercedesderiada@dmgeventsme.com ION announces new 3D multi-client reimaging
www.adipec.com programme offshore Brazil
Web news ION Geophysical Corporation has announced a new 3D multi-client broadband reimaging
programme offshore Brazil.
highlights Supported by industry funding, the Picanha programme provides a regional 3D
framework that cost-effectively delivers fresh insights into the complex Campos and
Inmarsat: Skills gap could act as a brake
Santos basins petroleum systems ahead of upcoming license rounds.
By using IONs latest broadband processing and imaging technology to reprocess and
on IoT innovation in the energy sector
reimage 100 000 km2 of data from more than 50 interconnecting public-domain 3D surveys,
HydraWell secures UK P&A deal ION is creating a regionally-calibrated, high quality and consistently-imaged 3D data set.
ALE to build new jacking system The regional perspective this data set provides will enable exploration teams to better

Merlin ERD engineers win drilling

awards
To read more about these articles
and for more event listings go to:
www.oilfieldtechnology.com
evaluate, risk and rank a portfolio of opportunities for current and future exploration
needs. The large programme will be delivered in phases to provide relevant bid round
knowledge as quickly as possible. The first 12 500 km2 over Round 14 have been delivered
to clients and the next 25 000 km2 are in progress for December delivery.
Repeated oil and gas discoveries in the world-class petroleum systems offshore Brazil
continue to draw operators to the region, said Ken Williamson, Executive Vice President
and Chief Operating Officer of IONs E&P Technology and Services group. Picanha
leverages IONs extensive local geological and geophysical experience in combination with
our new Accelerated Imaging, making it possible to rapidly deliver high quality data for
E&P companies to evaluate the context of these complex basins and to identify prospect
opportunities for upcoming ANP license rounds.

6 | Oilfield Technology August 2017

Old Battle.
New Weapon.
WITH POSITIVE COMPLIANT
SCREEN TECHNOLOGY
Halliburton Endurance Hydraulic Screen helps achieve
2017 Halliburton. All Rights Reserved.

superior completion results in deep water, multilaterals,

heavy oil elds, or wherever sand migration is a problem.
This positive compliant system removes the annular gap
between the screen and open hole to provide long-term
sand control. Plus, strong wellbore support is provided
for the life of the well. With a rapid, safe, and reliable
single-trip installation, operators are already achieving
35 percent and more reductions in overall completion
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and maximize the value of your asset.

halliburton.com/endurance
 World news August 2017

DNV GL carries out its first offshore drone survey First sign of Johan Sverdrup
emerging offshore
DNV GL surveyors have carried out the classification societys first offshore drone survey on
the semisubmersible vessel Safe Scandinavia in the North Sea. This 25 383 t tender support Last week the jacket for the Johan Sverdrup
vessel (TSV) is owned and operated by Prosafe, supporting Statoils drilling operations off the riser platform was installed by the Thialf
coast of Norway. Using camera-equipped drones, DNV GLs drone pilots checked the TSVs crane vessel owned by Heerema Marine
fairleads and their connection with the vessels two columns as part of the intermediate Contractors (HMC). Weighing a good 26 000 t
survey. the jacket is the largest on the Norwegian
Innovation is one of Prosafes core values. We are very pleased that we chose to try continental shelf.
the drone survey, as it helped us optimise our survey requirements and allowed us to save The jacket stretches 140 m from the
significant amounts of time and money. Normally, this kind of operation would cause seabed, where it covers an area measuring 94
disruption to our client for several days. The drone survey took only a few hours and was just times 64 m. It is attached to the seabed by 24
as effective, says Ian Young, Chief Operating Officer at Prosafe. poles weighing more than 9000 t in total.
This was a great opportunity for us to demonstrate our drones abilities to check the This is a special milestone for us,
condition of remote external components in challenging offshore conditions. The inspection because it is the first visible sign of the
only required the semisubmersible to de-ballast, then we flew the drone approximately Johan Sverdrup field. I am happy that the
25 m below the main deck to check the condition of the fairleads and their connections to installation has been carried out safely and
the columns that hold up the TSV. With wind speeds of approximately 15 knots, this went fully in line with the plan. We are now looking
very well and the survey showed that the fairleads and their connections were in a good forward to the next steps of this industrial
condition, explains Cezary Galinski, Project Manager Classification Poland at DNV GL. adventure and the long line of major
The classification society has carried out multiple drone surveys on both ships and operations awaiting us. We have already
offshore units, inspecting many areas on board, ranging from tanks and cargo holds to done a lot of work on and below the seabed,
external structures such as jack-up legs. The inspection of such spaces can be both costly and and in the time ahead we will gradually
time consuming, and even in some instances potentially dangerous. Using drones to visually become more visible above the sea surface
check the condition of remote structural components can significantly reduce survey times as well, said Kjetel Digre, project director for
and staging costs, while at the same time improving surveyor safety. Johan Sverdrup.

Expro secures 26 well abandonment contract for UK NPD grants drilling permit
North Sea multi-field campaign to Aker BP
Expro has been awarded a substantial contract from global oil and gas company Maersk Oil for The Norwegian Petroleum Directorate has
the provision of subsea and well test services on two offshore units in the North Sea. granted Aker BP ASA a drilling permit for
The contract will extend the long-standing partnership between the two companies until well 25/4-11, cf. Section 8 of the Resource
2020, for well abandonment services on two rigs, for a 26 well campaign across the Janice, Management Regulations. The drilling
James, Affleck and Leadon North developments in the Central North Sea. programme for well 25/4-11 will be carried
Expro has held a contract with Maersk Oil since January 2012 and was the primary out from the Maersk Interceptor at position
supplier of well test and subsea landing string systems for the company in the UK; this 594458.92N and 2918.66E. It will involve
included planning work for both the Janice and Leadon North abandonment campaigns. The the drilling of a wildcat well in production
recent contract win also includes the option for two further, one-year extensions. licence 677, where Aker BP ASA is the
Commenting on the award, Neil Sims, Vice President for Europe CIS region, said: operator with an ownership interest of 60%.
Our long-standing association has given us deep knowledge and understanding of the The area in this licence consists of the
aspirations for this project. We enjoy partnering with our clients and particularly Maersk, southern part of block 25/1 and the northern
which is why we were thrilled to secure this contract award. Given our strong track record part of block 25/4. The well will be drilled
of operational performance and delivery to date, we feel confident in our ability to maintain about 6 km southwest of the 25/1-11R
these high standards as we transition in to our new agreement with them. discovery (Storklakken).
Kevin Illingworth, Global Well Abandonment Manager, added: This is an excellent Production licence 677 was awarded in
example of a successful long term partnership that delivers integrated well abandonment APA 2012. This is the first well to be drilled in
services. We are delighted to continue our work on this key North Sea abandonment the licence. The permit is contingent upon
campaign, ensuring we maintain the highest levels of safety while ensuring a cost-effective the operator securing all other permits and
approach to this multi-field programme. consents required by other authorities prior
Expro is the market-leading provider of subsea and well testing services in the North Sea. to commencing the drilling activity.
In 2016 the company launched a dedicated well abandonment product line focused on The other licensees are Fortis Petroleum
delivering fully integrated decommissioning service solutions. Norway AS (30%) and MOL Norge AS (10%).

8 | Oilfield Technology August 2017

 ONSHORE. OFFSHORE. EVERY SHORE.
TM

IT ALL STARTS WITH

API STANDARDS.
No matter where you go around the world, the oil and gas
industry relies on API Standards to meet the highest level
TM

of safety. Show the world your commitment to safety.

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tagline are trademarks or registered trademarks of API in the United States and/or other countries.
 WHATS NEW
IN THE
NORTH SEA?
T
he last few years have been tough for the North Sea.
In a region where the harsh environment can make
operations difficult even at the best of times, the
upstream industry is used to facing adversity, but recent events
have begun to place additional strain on operators in this
mature basin. Its not just the burden of the industry downturn
and lower for longer price environment that has left operators
struggling to manage with breakeven prices in the mid-US$60s.
The region has also struggled to deal with cost inflation and
the loss of expertise caused by the Great Crew Change, as
senior crew retire with nobody to replace them. Yet further
challenges have arisen in the form of maturing fields, ageing
10 |
assets, and pressure from low-carbon initiatives, such as the
Paris Agreement.
Despite these difficulties, life is far from over in the
North Sea. Recent discoveries have shown that there are
still significant hydrocarbon resources out there, ready to
be discovered and exploited. Advances in technology from
implementing Big Data and the Industrial Internet to the use of
unmanned aerial vehicles (UAVs) for integrity management are
making it easier and cheaper to operate in the region. Even the
burden of ageing assets could actually represent a substantial
business opportunity for companies ready to take the lead in
decommissioning and P&A projects.
 David Bizley, Oilfield Technology, takes a look at the challenges and
opportunities facing the upstream industry in the North Sea.

E&P activity of a multi-billion barrel field in the Greater Lancaster area,

The North Sea has produced billions of barrels of oil over the
decades, but production has declined over recent years, falling
from a peak of 3 million bpd in 1999. Despite this decline, E&P
activity continues to take place and discoveries are still being
made.
Hurricane Energy made one of the most impressive
finds earlier this year. The Aim-listed company has made
a series of discoveries in the comparatively underexplored
West Shetland sector of the North Sea. Several positive results
from exploration wells, including a 1 km hydrocarbon column
at the companys Halifax well, strongly hint at the possibility
roughly 60 miles west of Shetland. The find has been hailed as
the largest UK discovery of the century. To put the scale of this
discovery into context, most recent finds in the North Sea have
been in the region of 25 million bbls.
Diedre Mitchie, Chief Executive of the industry body Oil
and Gas UK referred to the discovery as extremely exciting
and welcome news. She added that the announcement
demonstrates the significant remaining potential of the UK
Continental Shelf. Signs of optimism, mainly led by exploration
and production companies, are returning to the basin which
has worked hard to reduce costs and improve efficiency.

| 11
The question now is whether the oil found by Hurricane is
economically recoverable. According to the companys CEO,
Robert Trice, affordability shouldnt be an issue; he was quoted by
the Financial Times as saying: We can make money from Lancaster
at US$40 [] At US$50, were laughing.1
Another major North Sea project that made the news recently
is Enquests 4 billion Kraken heavy oilfield, located roughly 124 km
east of Shetland. The field kicked-off production towards the end
of June and is expected to have an output of 50 000 bpd once fully
operational.
In order to fund development of the field one of the UKs largest
industrial investments in recent years Enquest, worth 364 million,
had to take on roughly 2 billion of debt and even undergo financial
restructuring. However, now that production is up and running, the
company should begin to see returns on that investment forecasts
estimate that, at prices of US$55/bbl, the field will be capable of
providing cash flows of approximately US$700 million/yr over its
estimated 25 year lifespan.2 Even with lower oil prices, the field would
still provide a significant income stream.
These are just two examples of how, despite the challenges, the
upstream sector continues to invest in E&P activities in the North Sea.
New technologies
Despite its reputation for being risk-averse and somewhat
conservative, the upstream industry has long been a pioneer in the
development and utilisation of new technologies. The additional cost
pressures caused by the current downturn have further incentivised
operators to look to new technologies to cut costs and improve safety.
One field of technology that has seen a rapid uptake over recent
years is that of remotely controlled vehicles, commonly referred to as
drones. UAVs have proven to be particularly effective in the field of
offshore inspection and maintenance. By deploying a UAV to inspect
difficult-to-reach and sometimes hazardous infrastructure, such as
jack-up legs or flare booms, operators can save time, money and
reduce personnel risk.
DNV GL recently conducted its first offshore drone survey on
Prosafes Safe Scandinavia semisubmersible in the Norwegian
North Sea. Prosafes COO, Ian Young, commented on the survey: We
are very pleased that we chose to try the drone survey, as it helped us
optimise our survey requirements and allowed us to save significant
amounts of time and money. Normally, this kind of operation would
cause disruption to our client for several days. The drone survey took
only a few hours and was just as effective.3
Another advantage of remotely operated vehicles is that they
can be loaded with a variety of sensors, allowing operators to
gather a huge amount of data. At this years Offshore Technology
Conference, Total E&P and Oceaneering discussed how they had
fitted an autonomous underwater vessel (AUV) with a side scan sonar,
sub-bottom profiler, multibeam echo sounders, magnetometer, still
photo digital camera, and a bathymetric laser system.4
As these technologies continue to be refined, they are finding
uses in an ever greater variety of applications. Their use in mature
basins, such as the North Sea, looks set to help operators make
significant cost-savings.
Decommissioning and P&A operations
The North Sea is one of the most mature hydrocarbon regions in
the world, with an offshore infrastructure that is, in many cases,
operating well beyond its intended lifespan. Whilst new technologies
and more effective maintenance programmes can prolong the life
of offshore assets, sometimes decommissioning is the only viable
option. Whilst decommissioning can represent a burden to operators,
12 | Oilfield Technology August 2017
it can also be a major opportunity for those companies ready to
provide the necessary technology and expertise. Industry estimates
suggest that roughly 470 North Sea installations will require
decommissioning over the next 30 - 40 years at a cost of anywhere
from 30 - 70 billion.
Perhaps the most prominent example of North Sea
decommissioning so far is the removal of Shells Brent Delta platform
in April of this year. Installed more than 40 years ago, the Brent Delta
platform weighed 24 000 t, was as tall as the London Eye, and covered
a surface area almost the same size as a football pitch. In short, its
removal represented a major technical challenge. However, after
five years of planning and engineering preparations, the platform
was eventually removed in one piece and ferried to port on Allseas
giant heavy-lift vessel, Pioneering Spirit. The operation broke the
record for the heaviest marine lift ever undertaken at sea. By way of
comparison, the last time the Pioneering Spirit had been used for
such an operation, it was for the removal of the Yme platform in the
Norwegian North sea, which weighed some 10 500 t less.
In addition to the offshore work, the growing decommissioning
sector represents opportunities onshore too. In order to
accommodate the platform in port, Shell worked with port
authorities to strengthen and upgrade infrastructure for future
decommissioning work. This aspect of the operation alone provided
enough work for 106 jobs over a one-year period.
As the sector continues to grow, new companies are being formed
to take advantage of the situation. One such example is the recently
formed Well-Safe Solutions, which was established to provide a new
approach to the decommissioning of subsea wells. The company
aims to attract 200 million in investment and create 400 jobs.
Executive Director, Mark Patterson explained why the industry shift
towards P&A operations represents a substantial opportunity: The
market dynamics in oil and gas have changed significantly. Before
the collapse in oil price, operators were focused on maximising
production, costs were very high and assets scarce and, with no
real regulatory imperative, decommissioning was pushed back.
Cost and safety are still paramount but operators are now having to
face up to the well abandonment challenge. They need to prioritise
decommissioning activity and, with an increasing stock of shut-in
wells, more incentives, low asset utilisation and therefore lower rates,
the economics for P&A have become more compelling.
Conclusion
It is true that the North Sea faces real challenges over the coming
years, but the upstream industry has already begun the process
of adapting to the lower-for-longer price environment; new
technologies are making life easier for operators; and the burgeoning
decommissioning market represents a significant opportunity for
those with the expertise to take advantage of it.
The North Sea has been a hub of innovation and leadership in
the upstream industry for decades. The lessons learnt here, and the
examples set by innovators in this region as they overcome each
new challenge, will likely serve as the model for the global upstream
industry for decades to come.
References
1. Hurricane hopes to prove a new force in North Sea oil https://www.ft.com/
content/433e0b90-d98a-11e6-944b-e7eb37a6aa8e
2. North Seas largest new oil project in a decade begins flowing http://www.
telegraph.co.uk/business/2017/06/26/north-seas-largest-new-oil-project-
decade-begins-flowing
3. DNV GL carries out its first offshore drone survey https://www.dnvgl.com/
news/dnv-gl-carries-out-its-first-offshore-drone-survey-98663
4. OTC: New Ideas Floated for UAVs, Beyond Inspections https://www.spe.org/
en/ogf/ogf-article-detail/?art=2945
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