COR PO RATE-GOVERN M ENT RELATIONS WITHIN TH E GLOBAL OIL AND GAS INDUSTRIES S. Tchuruk, Chair and CEO, Total SA Excellencies, ladies and gentlemen, colleagues. It is a great pleasure for me to be in Norway, a country where TOTAL has been one of the early set- tlers and it is also a pleasure to address the distin- guished audience of WPC. Before sharing with you some ideas about the changing Corporate-Government relations within the global oil and gas industries let me recall what the late Paul Franke1 used to say: `Oil business is too serious a matter to be left to the market'. As an oil executive in charge of managing a private oil company, I do not share this view, but I can under- stand why, at the time, it could be said. One must recognize that in world history, the power of oil to decide on the fate of nations was often most cruelly demonstrated. Next Monday, we are going to celebrate the 50th anniversary of D-day. One has only to drop the names of Pearl Harbour (1941), El Alamein (1942), Stalingrad (1943) the battle of Atlantic and D-Day (1944) to remind us of the important role oil played in that war. The map (Figure 1) shows the two fold drive of the German armies towards Baku, Caucasus and Iraq. On the Russian front, the Operation Blau's main objective was the oil of the Caucasus, yet the irony was that the Germans ran short of oil in their quest for it. A few months later Hitler refused to transfer the German forces in the Causasus to help the embattled sixth army of Stalingrad on the ground that `Unless we get the Baku oil, the war is lost'. On the other side of the Mediterranean, General Erwin Rommel experienced a similar fate. Again and again, he recorded how the Afrika Korps was hampered by its fuel shortage. His road to the final objective, Baku and its oil fields, was finally closed off because of the fuel shortage! But that was fifty years ago. What about today? The point I will try to make is that nowadays Mr. i 2nd WORLD WAR:THE RUSH FOR OIL Figure 1 73 '74 PLENARY ADDRESSES PA8 Frankel's statement could be largely wrong, even if there is an accumulation of new circumstances which could induce a comeback of government intervention in the energy field. Of course, this view assumes that industry and free market forces can provide the reli- able energy supply that world growth requires. However this, in turn, depends to some extent on governments' will as I will discuss, making the matter of Corporate-Government relations some kind of a c hicken-and-egg situation. In my speech, I will briefly cover past trends in corporate-government relations, then comment on the changes happening today, and finally I will take a risk and look into the future. SOME COMMENTS ABOUT THE PAST Let us briefly recall the main features of past State interventions. In consumer countries, the main driving force was of course security of supply. For those countries which had natural resources, the objective wa
DRILLING OF HORIZONTAL WELLS WITH AN ELECTRIC DOWNHOLE MOTOR S. A. Shirin-Zade, 117957 Moscow, 6 Leninskiy Prospect; A. H. Mirzadzhanzade, NPO `Burooaya Technika ', Russia; A. S. Oganov and H. G. Gulatarov, 745100 Nebit-Dag, Koturdepinskoe, UBR, Turkmenistan Abstract. In Russia, Ukraine and Byelorussia more than 300 horizontal wells have been drilled, mainly, with hydraulic downhole motors. Yet, the use of the Electric Downhole Motor (EDM) for drilling horizontal and horizontally branched holes holds much promise. The advantage of this drive system is the availability of a reliable communication channel with the bottom hole. This makes it possible to obtain a continuous informa- tion on the bit and EDM operation, borehole path parameters while providing the transmission of the power required for the rock destruction at the bottom. The technique and technology available allows us to drill horizontal wells with a long and medium radius of curvature. The shortened motors of 95 and 105 mm diameter, which are now in the stage of development, will provide for drilling short radius wells (20-30 m). In the paper, the results of drilling horizontal wells in Turkmenistan are considered. In 1990-1992 three wells with a depth of 3603-3653 m have been completed. 45 more wells at 3500-4150 m are planned. Technical and economical drilling performance, casing programs and drill pipes sizes, EDM and surface equipment characteristics are presented. Efficiency of drilling technology developed on the basis of the self- organization (synergetics) is shown. Drilling experience is generalized with the application of fuzzy set theory methods and recommendations on BHA's and drilling practices are given. I NTRO DU CTIO N Horizontal wells have been drilled with the electric downhole motor in Russia, Ukraine, Turkmenistan and Azerbaijan. The first horizontally branched holes have been drilled in the West Ukraine to a depth of 3500- 3700 m in the seventies. In 1978 the horizontal well 196 was drilled in Novo-Uzybashev area in Bashkiria. Here, horizontal wells have been drilling with electric downhole motors (EDM) in Lemizinskoe, Mikhailovskoe, Arlanskoe and other oil fields since 1988. In this region more than 20 wells have been drilled with a curvature radius up to 120 m. In Turkmenistan in 1990-1992 three wells with a depth of more than 3600 m were drilled with EDM in the Koturdep area, where the oil recovery was increased 5 times and the field development invest- ment decreased 2.5 times. 1. DRILLING OF HORIZONTAL WELLS WITH THE ELECTRIC DOWNHOLE MOTOR IN KOTURDEP AREA (WEST TURKMENISTAN) 1.1. Geological characteristic of the area From the tectonics point of view in the area overall brachy-anticline there are marked out four places which are formed by faulting with the ampli- tude of about 200 m. The crown (central) place is settled relative to the west one. The north-east side, in its turn, is downcast to the same extent relative to
MARINE ENVIRONMENT RESEARCH CENTRE P. Lefevre and P. Tozzolino, Research & Industry Division, Elf Petroleum Norge AIS, Postboks 168,4001 Stavanger, Norway. Abstract. The prime focus of the off-shore related Research Centre's activities is the problem of pollution. The Centre's research work is concentrated on six major disciplines, all concerned with protection of the Environ- ment in relation to off-shore operations. These disciplines are : - biodegradation of hydrocarbons - marine ecotoxicology - Arctic environment studies - effects of oil-related pollution on maritime life - techniques for cleaning drill cuttings - Development of technologies for combating oil pollution These researches are focused on oil and gas in the marine environment and pollution occurring in the sea from various types of hydrocarbons. In addition, chemicals used to enable and improve drilling and production processes are taken into account in studies concerning their environmental effects. In the hydrocarbon biodegradation area, `Bioren' which is a project under the European research programme Eureka, started last year. It is aimed at improving application technologies and new products capable of acceler- ating the biodegradation of hydrocarbons. The project has a four year schedule and research is carried out in cooperation with Rogalandsforskning and Sintef in Norway as well as foreign institutions in France and Spain. Elf Akvamilj~, open in early 1994, is a Research - Effects of oil-related pollution on marine life. Centre fully dedicated to marine environment - Techniques for cleaning drill cuttings. dealing with pollution problems from hydrocarbons - Development of technologies for combating oil and chemicals related to operations like exploration, pollution. production, transportation, refining and storage. It is As an illustration of these topics, some of the pro- located in Stavanger area, close to the fjord. The jects running at the Centre are presented below. building has a total area of 1700 m2. It includes dif- People in the Elf Group have a large hydrocarbon ferent laboratories such as ecotoxicology with biodegradation experience especially in bio- climate rooms, analytical chemistry, microbiology remediation that concerns the use of nutrients for and fermentation and a pilot unit for scaling up accelerating the natural process. They contributed before experimentations on site. A pipe is picking up recently to bioremediation in the area of Prince sea-water for various experiments at 80 m deep in William Sound in Alaska after the Exxon Valdez order to ensure correct and constant quality. The accident in 1989. However bioremediation is still in Research Centre is operating with about a dozen its infancy and for operational use both the products people and is able to welcome some scientific to be applied and the strategies for application need researchers at a trainee, PhD or pos
GAS PIPELINE NETWORKS: THE INSTITUTIONAL, LEGAL AND ECONOMIC FRAMEWORK FOR GAS PIPELINE NETWORKS IN WESTERN EUROPE Dr. Burckhard Bergmann, Member of the Executive Board, Ruhrgas AG, Essen, Germany Abstract. The situation in western Europe today is characterized by European integration on the basis of differ- ent structures in individual countries. This situation is to be seen against the background of historical develop- ments. Depending on such factors as previous town gas production, geographical location in relation to natural gas reservoirs as well as economic and industriai policy, different structures of gas industry evolved in the countries of western Europe. Today they range from vertically totally integrated public entities protected by exclusive rights to multi-faceted free-enterprise structures. The legal framework for gas transportation in the EC is marked by the fact that the construction of pipelines requires different forms of approval in almost all EC countries. In several EC countries, companies have exclusive rights in respect of gas transportation. The framework and structures of the western European gas industry become particularly clear when com- pared with North America. As a result of decades of regulation and other factors, such as a large number of producers and a high degree of self-sufficiency in contrast to the few major producers in Europe and western Europe's fairly high dependence on imports, gas transportation became a separate business area for pipeline companies in the United States. In western Europe, a completely different development occurred. A typical feature of the gas industries in western European countries is the fact that gas transportation is an integral part of the overall marketing business of each gas company. Gas transportation is thus a cost factor alongside many others (such as purchase and storage costs), all of which have to be covered by the gas company's sales income. Major cross-border pipeline investments are not decided and financed on their own, but form part of the overall marketing of gas to be transported by the pipeline concerned. Differences between gas industries in western Europe need not hinder the process of economic integration, but can play a meaningful economic part because competition between the various systems helps to identify the most efficient one. It would certainly be wrong and extremely risky to try to enforce uniformity on the wide variety of structures in the western European gas industry. The existence of a certain degree of competition between the different structures may lead to an efficient, low-risk evolution of the European gas industry. 1.
: EUROPEAN INTEGRATION ON THE BASIS OF DIFFERENT STRUCTURES In today's merging western Europe, the political situation is characterized by diverse efforts towards integration or harmonization. This applies particu- larly to the economic sector. The completion of the single European marke
DISCUSSION NEW FUELS AND LUBRICANTS Chairman: JOHN J. WISE, Vice President, Research, Mobil Research and Development Corporation, USA Environmental concerns drive need for new fuels and more stringent lube quality. Recent advances from the American Auto/Oil Program showed that repairing high emitting vehicles is one of the most cost-effective means to reduce automotive pollution. New fuels (natural gas and oxygenates from FCC gasoline) and biodegradable lubricants are receiving increased attention. Paper 1 : Recent Advances from the USA Auto/Oil Air Quality Research Program-ALLEN A. KOZINSKI, Amoco Oil Company, Chicago, Illinois, U.S.A. and DONALD K. LAWRENCE, Company, Naperville, Illinois, U.S.A. Q. A. Q. A. Q. A. Q. A. Q. A. Q- What were the other sources of ozone gener- ation cited in your paper? E. F. FREUND, Institut Francais du Petrole, France. Biogenic sources such as trees, and area sources such as barbecues, paint, etc. What model used for ozone calculations? ZEINER, Austria. Government models were used. The worst ozone episodes were modeled. We believe the trends are correct, if not the absolute levels. What range of MTBE studied? Unidentified questioner. Only 0% and 15% MTBE. Did you study lubricant effect on auto emis- sions? P. TIJM, Shell, U.K. No, not studied in the U.S. Auto/Oil Program. What is the impact of reducing Sulfur below 20 ppm? D. CHAPEL, Fluor, U.S.A. In general, the lower the better. Emissions con- tinue to decline consistently to 10 ppm, the limit of our tests. Would ozone in the lower atmosphere impact the upper atmosphere? BADAKHSHAN, Uni- versity of Canada. A. We did not study this, but would not expect it to. Paper 2: Production of TAME and Heavier Ethers to Achieve Higher Oxygen and Lower Olefins Content in Gasoline-JUHA J JAKKULA, Neste Oy, Porvoo, Finland; HARR1 JARVELIN, Neste Oy, Porvoo, Finland; JOUNI KIVI, Neste Oy, Porvoo, Finland. Q. Can your technology be used fur ZTBE? J. A. Yes. Q. Can side reactor concept be applied to an MTBE unit? R. DE LAS HERA, Repsor, Spain. A. Yes. Q. Were isomerization and alkylation integrated? Unidentified questioner. A. Not done yet, but could be. Q. Do you have commercial experience? T. S. R. PRASADA RAO, Indian Institute of Petroleum, India. A. We are building a unit at a Neste Oil refinery now. Q. Can you use C5-C, olefins? J. J. WISE, Mobil R&D Corp., U.S.A. A. We can alkylate all tertiary olefins. Paper 3: Use of Natural Gas as an Engine Fuel in France-GILLES G. ALLARD, Gaz de France, La Plaine Saint Denis, France; JEAN PREZAT, Gaz de France, La Plaine Saint Denis, France; JEAN CLAUDE GUIBET, Institut Francais du Petrole, Paris, France. Q. Do you study close coupled catalytic conver- tors? M. AOKI, Tonen, Japan. A. No. Q. Are auto manufacturers involved in the CNG program? Unidentified questioner. SOLIS, Spain. 123 A. Q. A. Q. A. Q. A. Q. A. Q- A. Q. A. Yes, in the R&D. Is storage of CNG
MINIMISING OIL FIELD IMPACT IN AN ARID ENVIRONMENT F. M. S. Al-Lamki, S. Zwolle and R. van Rede, Petroleum Development Oman, Muscat, Sultanate of Oman. Abstract. The policy of Petroleum Development Oman (PDO) on environmental conservation states that the Company will protect the environment, prevent pollution and minimize any impact that may arise from its activities. To assist this objective, oil field development in PDO includes several initiatives to minimize the impact on the unique desert environment, including its renewable natural resources and landscape heritage. Activities which involve physical/mechanical impact on the environment such as facilities and road construction, pipeline excavation and drilling sites preparation are regulated by guidelines for earth moving operations. The guidelines have the prime objectives to minimize impact. For seismic operations, the company conducts its own internal environmental impact assessment. This initiative follows from the realization that the seismic surveys can cause some unnecessary damage to the desert environment. In drilling, slim hole design technology has been implemented to reduce costs but it also at the same time reduces waste production and minimize disposal volumes of the drilling fluid. The company is also evaluating new technology to further reduce waste e.g. by converting drilling mud into cement by using slag. Deep disposal injection of produced water into the source reservoir will become a standard practice aimed at safeguarding the shallow groundwater resources. Water production is also gradually being reduced by drilling horizontal wells and by chemical water shutoff. Other environmental initiatives implemented in field development plans includes identifying local landuse practices, mapping biological resources and ecological sensitive areas.
TO PDO ENVIRONMENTAL MANAGEMENT PLAN The policy of Petroleum Development (PDO) on environmental conservation states that the company will protect the environment, prevent pollution and minimize any impact that may arise from its activity. To maintain this policy PDO has introduced an Environmental Management Plan. This plan addresses the major environmental issues and sets an action plan, that needs to be cascaded to the Corpo- rate Units: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Housekeeping; Desert Clean-up Production Water Management Gaseous Effluents Energy and Gas Conservation Soil Protection Waste Management Chemicals Management Freons and Halons Earthmoving Abandonment and Restoration In consequence, environmental conservation is best served by minimizing the impact of operations and facilities, especially those which are seen as tempo- rary. Some of the action plans are already covered by guidelines and manuals. The notes presented below are examples in which some of the cooperate units are pursuing. PLAN IMPLEMENTATION AND INITIATIVES Production Water Management PDO Cooperate units have ta
CHINA Speech by CNPC President WANG TAO Mr. Chairman, Ladies and Gentlemen: It is a pleasure for me to attend this ministerial- level meeting to exchange views on energy with my counterparts from different countries. Now, if I may, I would like to give a brief introduction about the development of the Chinese petroleum industry and its opening policies. China has achieved a rapid development for its petroleum industry since 1949 when the People's Republic of China was founded. It has made great progress in science and technology, especially since the end of the 1970s when our country started to implement economic reform and the opening poli- cies. The oil production in China rose to 2.88 million barrels per day in 1993 from 2400 barrels per day in 1949 and gas production reached 16.2 billion cubic meters. To meet the rapid national economic growth rate, China is now making efforts to stabilize its oil pro- duction in the East and while to accelerate the explo- ration and development in the West and also speed up the development of offshore oil and gas resources. The oil and gas production is expected to keep rising in the next few years and reach up to 200 million tons in oil equivalent by the end of this century. One of the important policies for development of Chinese petroleum industry is self-reliance while opening to the outside world to absorb foreign capital, technology and management experience. In the petroleum sector, China has established coopera- tive relations with more than 50 countries for eco- nomic and technical exchanges since 1979. The introduced technology, equipment and capital for our petroleum industry have been over 15 billion US$. In addition, China has also signed a number of cooperative agreements with foreign companies for oil and gas exploration and development and set up a number of joint ventures for technical service and manufacture of special equipment. The oil cooperation with foreign countries has been extended from offshore to onshore. The area of the onshore blocks for cooperation with foreign com- panies now, is more than one fifth of China's total land area. Last year we opened the potentially oil- rich Tarim Basin. This has aroused great interest from the international petroleum community. CNPC has signed three agreements on risk explo- ration of petroleum during the first round of bidding. The second round of bidding is already under way. Some substantial results are expected to be achieved in the coming months. Meanwhile, CNPC has also made some good achievements in overseas oper- ations. As an oil-rich country, China has a great potential for oil and gas exploration and production. The poli- tical situation in this country is quite stable. The demand for energy will keep growing with the national economy being rapidly developed. The Chinese large market and opening policies are cre- ating good environment and opportunity for foreign investors. China has already set up good partnership wi
.. . . . x. THE MAP OF TECTONICS AND PETROLEUM OF THE EARTH Ya. P. Malovitsky, L. E. Levin and A. P. Simonov, PO `Soyusmorgeo ' OGF, Kas1 Marx 19, Murmansk 183048, Russia. Abstract. The map at a scale of 1:lOûûûûûO (with inserts for Polar regions of the Earth at a scale 1 :15000000 and 1:25ooOûûO) is compiled on the basis of a generalization of recent geological/geophysical data for the territory of the former Soviet Union and published data over territories of other countries and the World oceans. The compilation of the map had a goal to analyse a number of fundamental and practical problems of petroleum geology. These problems include: determination of tectonic peculiarities of localization of large zones of petroleum accumulations; comparable estimation of petroleum prospects of the sedimentary basins on the continents and in the World ocean; analysing of the structure of the sedimentary basins prospective for search for hydrocarbon accumulations in depths more than 5 km; determination of areas prospective for search for hydrocarbon accumulations in underthrusted zones. The latter required drawing on the map not only sedimen- tary basins, but separating the fold-thrusted mobile belts (Mediterranean, Circum-Pacific, Arctic). One of prin- cipal new results, which was obtained after compilation of the map, is showing the structure of the Arctic shelf. This shelf has very significant areas for search for hydrocarbon accumulations within rift systems of different ages; the Arctic-North Atlantic system of Early Mesozoic age; the Late Cretaceous-Cenozoic system of the Laptev Sea; the Vilkitsky-North Chukchi and East Siberian systems of Early Cretaceous-Eocene age; the South Chukchi (Hope) of the Late Cretaceous-Eocene age; Cenozoic system of the Mackenzie delta; the Late Paleozoic-Early Cenozoic of the continental margins of the Arctic Islands, northern and eastern Greenland. Some zones of oil and gas accumulation have been found in separate segments of these systems, i.e., the North Sea, the West Siberian, the Amerasian (Arctic slope of Alaska, the Mackenzie delta rift and the Beaufort Sea). The details of the structure of other segments of the above-mentioned systems show regions more prospective for search for large oil and gas fields. The `Tectonic and Petroleum Potential World Map' has been made up (Mercator prqjection, on the scale 1 : lOOOOOOO), including the insertions of the Earth polar areas in latitude 50"N and 203, on scales 1 : 15 OOOOOO and 1 : 25 OOOooO. The modern tectonic fundamental principle is 57 58 STRATEGIC BASIN WIDE EXPLORATION assumed as a basis, according to which the complete cycle of lithosphere evolution (`Wilson cycle') rep- resents the orderly nature of processes from opening to closing of ancient oceans and their conversion into continental fold belts. The synchronous nature of the active tectonic process on the continents and in the oceans during the late 160 My is a reason to suppose
NEW APPROACHES TO HEAVY OIL RESIDUES UPGRADING Prof. V. V. Lunin, Chemistry Department, MSU, Lenin Hills, Moscow 119899 Russia; Prof. S. N. Khadjiev, Institute of Petrochemistry, Moscow, Russia. Abstract. Processing of oil vacuum distillation residues requires the solution of a number of well-known but extremely complex chemical and technical problems. Development of new processes for effective processing of vacuum distillation residues of different oils is being conducted. Catalysts-donors of activated hydrogen due to their ability to absorb hydrogen in great quantities in a bulk are used in one of them. Hydrides of intermetallic compounds of transition metals refer to these catalysts in saturation reactions of polycyclic aromatic nuclei by hydrogen, hydrochemolysis of C-C, C-N and C-O bonds. The catalysts are not actually poisoned by metals from the raw materials. High efficiency is shown by catalysts based on the molybdenum salts soluble in water that are mixed with raw material in a specific way. As a result a super-dispersed catalytic system able to operate under low pressures (7.0-10.0 MPa) to realize an efficient C-O bond rupture in heavy petroleum residue and even in coal is formed. New opportunities can be obtained by a new thermoprocess based on the technology of bond rupture of C-C, C-H and C-S in the presence of active particles formed during combustion of light hydrocarbons in a flow of oxygen. Processing of oil vacuum distillation residues requires the solution of a number of well-known but extremely complex chemical and technical problems. Development of new processes for effective pro- cessing of vacuum distillation residues of different oils is being conducted. Catalysts-donors of activated hydrogen due to their ability to absorb hydrogen in great quantities in bulk are used in one of them. Hydrides of inter- metallic compounds of transition metals refer to these catalysts in saturation reactions of polycyclic aromatic nuclei by hydrogen, hydrogenolysis of C-C, C-N and C-O bonds. Catalysts are not actually poisoned by metals from raw materials. Pro- cessing of West Siberian oil distillation residues for 100 hours of continuous operation at 673-773 OK, 1- 5 MPa, 0.5 h-l, the catalyst provided the demetal- lization of raw materials of 80-90 wt%, denitrogenation of 70-80 wt% and desulfurization of High efficiency is shown by catalysts based on molybdenum salts soluble in water mixed with raw material in a specific way. As a result a super- 40-60 wt%. dispersed catalytic system able under low pressures (7.0-10.0 MPa) to realize an efficient C-C bond rupture in heavy petroleum residues and even in coal is formed. Experiments on the pilot plant with a capacity of lo00 tons of raw oil per year while pro- cessing of oil vacuum distillation residues (Venezuela) gave the following results : the conversion in hydro- carbons, boiling lower than 793"K, is 90-95 wt%, demetallization-90-95 wt%, desulfurization40- 60 wt% (723-773 OK,