Marginal Field Value Maximization by Going Back-To-Basics with Design-To-Value Enhancement

Abstract

Value is defined by a quantum of functions or returns received from resources invested. It is challenging for extremely marginal oil and gas fields where returns hardly meet invested resources profitably. Stranded, widely scattered resources add to the complication. This paper shares a complete revamp in notional wells and facilities development concept generation for such fields by going back-to-basics and shifting mindset towards designing to value to rigorously improve project viability. Conventionally, wells and facilities design are to economically match recoverable resource volumes. This strategy is largely unsuccessful when it comes to marginal-untapped-scattered-shallow oil resource of less than 5MMboe. A case study was initially designed to have multiple drill centers with a handful of pipeline tiebacks, requiring a large wellhead platform (WHP). This led to a highly unfavorable economic outcome. Going back-to-basics, coupled with Design-to-Value (D2V) approach, has proven to be effective as it is a systematic way to develop an optimum concept for maximum value realization. This agile approach questions every aspect of concept development to achieve minimum technical requirements while providing better clarity in cost-risk trade-offs through concept evaluation in a step-up, staircase manner. For wells, adopting back-to-basics cum D2V approach means initiating development via a vertical-well-only concept, with well placement that gives the highest well deliverability. It starts with 1 vertical well at the selected reservoir layer with the highest recovery potential before further well addition. For facilities, this approach means challenging the absolute minimum of lightweight structure (LWS) design by identifying topside's minimal functional requirements. For the case study, evaluation starts with 1 well, 1 LWS and 2 pipelines. The incremental impact from stepwise addition of wells with or without adding another LWS and/or pipeline is subsequently assessed. From all iterations, a value curve is then plotted to ascertain the concept that delivers maximum value. As a result, its development concept was revised from having 12 costly deviated wells at 1 WHP to 5 individual, low-cost vertical wells from multiple LWS. With that, up to 80% hydrocarbon volume originally to be recovered remains achievable while attaining a 50% improvement in Unit Technical Cost. This approach demonstrates great improvement in project economic viability. Back-to-basics cum D2V approach is therefore recommended in development strategy formulation for marginal-untapped-scattered-shallow oil resources as it managed to establish a minimum business case for further optimization and value improvement. Aggressive value engineering efforts such as D2V are key to successfully unlock stranded, marginal fields. Readiness to deviate from technical design norms is also important. Trade-offs are expected to be made in realizing projects in these trying times. That said, resource owners can still strive to balance technical safety design requirements against economic targets by adopting suitable concept generation and design approaches.