SPE 2013: Technology development, training crucial for ultra-deepwater development
Worldwide deepwater exploration and production will form an increasingly important share of the energy mix in the years ahead, but accessing reserves in challenging environments will require that technology keep pace with growing oil and gas demand, a panel of industry executives told delegates to the Society of Petroleum Engineers’ Annual Technical Conference and Exhibition (ATCE) in New Orleans.
NEW ORLEANS – Worldwide deepwater exploration and production will form an increasingly important share of the energy mix in the years ahead, but accessing reserves in challenging environments will require that technology keep pace with growing oil and gas demand, a panel of industry executives told delegates to the Society of Petroleum Engineers’ Annual Technical Conference and Exhibition (ATCE) in New Orleans.
While shale gas and unconventional resources technology dominates the 2013 event’s technical sessions, SPE chose to kick off the event with a panel discussion on deepwater challenges featuring a mix of officials from government, operators, and service providers. Each offered a different perspective on familiar themes of the safety issues, technical hurdles, and personnel demands involved in deepwater exploration and production.
Given the 2013 event’s location, much of the discussion focused on the Gulf of Mexico and new exploration in the frontier ultra-deepwater trends, such as Shell’s Lower Tertiary Stones prospect in 9,500-ft (2,896-m) water depths, which received a final investment decision this year. The company is also evaluating its ultra-deepwater Appomattox and Vito prospects, said John Hollowell, executive VP, Deepwater, for Shell Upstream Americas.
“The Gulf of Mexico has remained as one of the most important areas of growth and returns for Shell,” Hollowell said, while noting that frontier plays will require technological advances in high-pressure, high-temperature (HP/HT) equipment and enhanced recovery.
“Wells and subsea systems will be more complex…and more abundant as we go forward,” he said. “Enhanced recovery methods, like artificial lift and improved oil recovery technologies, will be needed from first production.”
FMC Technologies Chairman and CEO John Gremp explained that his company is developing subsea equipment gauged to handle reservoir pressures up to 20,000 psi and temperatures up to 400°F. Deepwater recovery rates, currently about half the rate of onshore recovery, will also have to be increased to meet the estimated 27 MMb/d of additional production needed by the end of this decade, of which 10 MMb/d is expected to come from deepwater.
Noting that “we’re faced with a very difficult reservoir and operating environment,” Richard Ward, president, completions and production at Baker Hughes, said the industry’s goal is to obtain Lower Tertiary recovery rates of more than 20%, compared to the estimated 10% that the fields would yield with natural flow. The industry is putting considerable money behind this and other mid- and deepwater Gulf of Mexico efforts, with annual spending expected to climb to $20 billion by the end of the decade.
Ward also addressed what many see as a looming shortage of qualified workers and the aging of the current workforce.
“As an industry, we need to recruit and train sufficient engineers to not only address the retirement gap, but also to meet future activity levels across all frontiers: deepwater, unconventionals, and brownfields,” he said.
Activity in the region has rebounded after taking a plunge in 2010, when the federal drilling moratorium sidelined a number of deepwater drilling programs, said Lars Herbst, Gulf of Mexico regional director at the Bureau of Safety and Environmental Enforcement (BSEE).
“You can see a very robust program of drilling activity in the Gulf of Mexico,” Herbst said. “We are expecting 17 deepwater drilling rigs to enter the Gulf under long-term contracts (between now and 1Q 2015).”
Ten deepwater Gulf of Mexico projects have been sanctioned and are in development, while another eight are under appraisal, Herbst said.
“For drilling, there’s plenty of opportunity.”