The Use of Mathematical Programming to Determine Optimal Production and Drilling Schedule in an Offshore Oil Field, A Case Study From the Barents Sea

Abstract

A field with two neighboring reservoirs was discovered in the Barents Sea in 2013 and 2014. After a successful extended well test of an appraisal well in 2018 and initial field planning tasks, a preliminary drilling and production schedule was proposed based on cross-domain collaboration and group work involving several disciplines. In this paper, mathematical programming is employed to model and optimize the economic value of the project in order to determine the best drilling and production schedule for the field. The optimization includes some of the technical constraints considered by the field development team while also considering uncertainties such as reservoir size, productivity of well, and cost. These have been systematically evaluated by using simulation-based optimization (sampling). The results were that the use of mathematical programming allows the field planner to evaluate several scenarios within a reasonable time frame, thereby enabling rapid changes in the decisions to respond to new information and risk considerations in a dynamic environment. This paper illustrates the benefits of utilizing mathematical programming in early field planning to optimize the drilling and production schedule.

Price Stress Testing in Offshore Oil Field Development Planning

“…Moreover, due to the lack of detailed cost information for the tieback cases, we expressed their cost as a fraction of the standalone cost. The trade-offs of timing and costs between Concept-2 and Concept-3 were further discussed in a previous work by Lei et al [51].…”

“…7 for an illustration). In previous work, Lei et al (2021) study these alternatives individually using mathematical programming to determine the optimal drilling and production strategy [51,52]. In both papers, a constant oil price of 60 USD/barrel was used.…”

Evaluation of tieback developments for marginal oil fields with timing flexibility

“…The case study results were that the expected NPV of an offshore oil field developed could be raised by as much as 76% through subsea tiebacks and more. Elmerskog (2016) described the added value of co-producing the adjacent oil fields Johan Castberg and Alta-Gohta, concerning capital expenditures, while Lei et al (2021) presented a mathematical programming approach to evaluate tiebacks for the same fields. Fedorov et al (2020) andFedorov et al (2021) combined real options approach and decision analysis to identify the value created by a sequential drilling strategy for marginal oil field development in the face of a great market and technical uncertainty.…”