Africa (Sub-Sahara) ExxonMobil will drill its first exploratory well offshore Liberia this month, the company announced on 18 October. A deepwater well is planned on the Liberia-13 Block, which is about 50 miles off the coast of the West African country. Solo Oil plans to spud the Ntorya-2 appraisal well in Tanzania next month. The drilling pad is a mile southwest of the 2012 Ntorya-1 discovery well, which was tested at rates of 20.1 MMcf/D of gas and 139 B/D of condensate. An independent report estimated the discovery to hold 153 Bcf of gas in place, of which 70 Bcf is considered a gross best-estimate contingent resource. A gross best estimate of more than 1 Tcf of gas in place has been made for the Ntorya prospect as a whole, in which the company has a 25% interest. Asia Pacific BP has decided to abandon drilling plans in the Great Australian Bight offshore southern Australia, an area in which prospective drilling has long been contested by environmentalists.
Gas is flowing in the second phase of the West Nile Delta development offshore Egypt, operator BP reported this week. Production, currently at around 400 MMcf/D, is expected to reach 700 MMcf/D at peak. Developed as a long-distance deepwater tieback to an onshore plant, the second phase includes eight wells producing from the Giza and Fayoum fields. The West Nile Delta project as a whole consists of five gas fields across the North Alexandria and West Mediterranean Deepwater offshore concessions, 65–85 km off Alexandria. Phase 1 of the project, launched last year, consists of gas production from the Taurus and Libra fields.
It is very flat, rising to only 60 feet above sea level at a distance of 150 kilometres south of the Mediterranean coast, and is both intensely populated and cultivated. This plain is bound by 30 to 60 feet escarpments of raised Pleistocene deposits which are more continuous to the west than to the east where they are interrupted by the Wadi Tumilat valley near Ismailia. Along the coast, a series of large, shallow lagoons form an almost continuous belt from Alexandria to Port Said, the largest of which are El-Burullus and El-Manzala lakes. These lagoons are sites of intensive fishing activities including aquaculture. Discontinuous coastal dunes, 15 to 60 feet high and dune fields in the east, 15 to 30 feet high, constitute the only local relief. Offshore, the continental shelf of the Nile Delta is narrow and steep at Alexandria, but increases to 50 kilometres width east of the Rosetta mouth of the Nile, as far as North Sinai. The shelf break is at water depths between 260 to 600 feet.
Production strategy is an important component of the oil reservoir development phase. Among,the main parameters are the geometry, number and position of wells and platform liquid capacity, influencing the level of the project investment required, which all depend on geological characteristics, economic scenarios and fiscal regimes. In the oil industry, companies produce under a fiscal system imposed by the government, which has a strong impact on economic and operational indicators, influencing production strategy.
Recently, the Brazilian government established a law changing its fiscal terms on pre-salt areas from Royalty and Tax (R&T) to Production Sharing Contract (PSC) to increase the government take. Previous works have shown that, in optimistic scenarios, an optimal recovery strategy presents low discrepancy in the production strategy configuration across both fiscal regimes. This study considers four economic scenarios for further evaluation. For this purpose, a simulation model was submitted to the production strategy selection process for both fiscal systems.
In more pessimistic economic scenarios, the results indicate that the number of wells and the level of investment tend to be lower under PSC than under R&T system. Thus, the new system could lead to fewer industrial investments, which would reduce the government return compared to the former tax system. In the most pessimistic scenario considered, profitable production could be expected under R&T, while under PSC it would be unprofitable, generating lower revenues.
It is still not clear whether a company, under PSC, will also be able to develop its strategy plan based on NPV or whether negotiation with the government regarding a minimum oil recovery factor will take place. Regardless, this study identifies the impact on production strategy selection for the new Brazilian PSC system compared to optimized strategy for R&T, and in both cases the objective-function is the company’s NPV. From the company’s point of view, depending on the economic scenario, the prevailing fiscal system will influence decisions at the level of the investment to be made. The results show the importance of considering the impact of the new fiscal system when selecting production strategies.
Key words: Production Sharing Contract, Production Strategy, Reservoir (Simulation), Economic Scenarios, Petroleum Engineering
Selecting a development strategy is a very important task for the oil industry and has the purpose of enabling the exploitation strategy plan, which considers some variables such as physical, operational and economic restrictions. The great majority of cases select production strategy aiming to maximize revenues, choosing as objective-function the Net Present Value (NPV) as it also includes discount rate in its calculation. The strategy plan will then be assigned for an oil field, the result of which has to be in accordance with both company and government goals.
For example, facilities engineers typically develop an arbitrary design case (i.e. a snapshot in time), which is some combination of the worst possible scenarios of each of the key inputs, such as reservoir temperatures and well deliverability, each of these inputs having uncertainty associated with them. As many modern production system designs are for deeper water and longer step-outs, making them economically marginal, assuming the arbitrary worst design case no longer seems appropriate and understanding the effect of uncertainty on the design becomes increasingly important.
Abdelhamid, Mohamed S. A. (Petrosilah Petroleum Company) | Maarouf, M. (Petrosilah Petroleum Company) | Kamal, Y. (Petrosilah Petroleum Company) | Shaaban, A. (Schlumberger) | Mathur, A. (Schlumberger) | Yosry, M. (Schlumberger) | Kraemer, C. (Schlumberger)
The Western Desert of Egypt is a mature hydrocarbon province that has been producing oil and gas for the past 60 years. With the vast majority of the oilfields in decline, almost all wells require hydraulic fracture stimulation to produce economically. This paper describes the application for the first time of a novel channel-fracturing technique combined with rod-shaped proppant in selected production targets in the Cretaceous-aged Abu Roash and Upper Bahariya formations in the El-Fayoum concession in the Egyptian Western Desert. The channel fracturing technique introduces channels within the proppant pack that increase conductivity and effective half-length leading to increased production (Gillard et al. 2010). Rod-shaped proppant when used as tail-in in fracturing treatments increases near-wellbore fracture conductivity and prevents proppant flowback due to its particular geometry (McDaniel et al. 2010).
Many sedimentary features of hydrocarbons in the Western Desert in Egypt are characterized as multi-layered, deltaic, thinly and tightly laminated sandstones consisting of sands with limited lateral and vertical extension with an average permeability of 1 mD and Young's modulus in the order of 2.6 million psi. Historical challenges in the field using conventional hydraulic fracturing have included a premature screen-out rate greater than 45% and subsequently, proppant flowback issues.
A campaign of 4 wells was conducted in the Silah field in the El-Fayoum concession for comparison against 7 offset wells fractured with conventional techniques. With the application of the channel fracturing technique, the screen-out rate of fracturing treatments was reduced to zero, thus eliminating the cost of additional workover rig time or coil tubing cleanup time, and in most cases, the loss of a potentially productive zone. Further, the application of rod-shaped proppant has eliminated proppant flowback. The positive results from implementation of this combined stimulation technique have led to a vigorous expansion of its utilization throughout Egypt's Western Desert area.