Getting the Most of Niger Delta Fields; Countering the Effect of Urbanisation: SPDC Case Study

Abstract

Urbanisation effects around fields in the Niger Delta has made onshore hydrocarbon production activities not to thrive in a clime of increasingly health, safety and environment (HSE) oriented operations leaving most well locations encroached by emerging towns, with flowline right-of-way (RoW) already encumbered. Sigma field is one of SPDC fields in the Niger Delta that were impacted by third-party encroachment. An initial assessment showed 26 producing oil conduits and 11 RoWs were impacted resulting into production deferment of ca. 10,300 bopd. Given an encroachment resolution cost of ca. US$37mln budgetary provision there was the need to carry out cost-benefit analysis of the additional investment. This paper presents the approach adopted to get the most out of the field in the Niger Delta whilst countering the effects of third-party encroachment through set criteria: well cluster based on common location, and creaming based on recoverable volume, conduit level reserves and conduit potentials. 19 conduits were recommended for re-opening with a life cycle recoverable volume of 33MMBOE saving US$9.6mln. It was concluded from preliminary economics that the encroachment resolution cost of US$37mln can be accommodated by the additional oil and gas production notwithstanding the rigour required for handling third-party issues.