As an operator, we did break the rules a little bit when we discovered that the most economic way to supply our exploration needs was to build our own seismic boat. In January of 1994, Petro-Tech Peruana S.A. became the new concession operator of a vast offshore block in North West Peru. Heavy front end drilling commitments consumed the first three years of operations and the bulk of the new company's budget was spent complying with this obligation.
In the natural progression of drilling and producing a mature oil field, 90 fixed platforms were constructed and placed within four main field areas just off the coast. Initially, shallow wells yielded the liquid income from the field and over time the wellbores sought deeper targets. Advanced directional tools and long reach drilling techniques have extended the use of the original 90 platforms into the new millennium, but Petro-Tech realized the time had arrived to explore for new reserves.
Late in 1996, the new company set out to expand the exploration program with high quality aero-magnetics and gravity surveys as its initial data acquisition. This would be immediately followed up with an extensive 2D/3D seismic program. Petro-Tech's concession consists of one million acres, all offshore, and containing some of the most complex geology on the planet. The existing field areas sit on less than 20% of the total acreage.
Small job costly
Petro-Tech was stunned after seeking bids for seismic acquisition and it became rapidly apparent that the small company could not afford the amount of data that it was seeking to acquire. This was largely due to the fact that the seismic industry was peaking in terms of fleet utilization. With the trend toward larger vessels towing enormous spreads, the name of the game was coverage and small isolated jobs became very pricey.
Considering that Petro-Tech is the only company with offshore operations in Peru, and possibly the entire West Coast of South America, mobilization was a big factor for many of the large seismic companies. Ninety fixed obstacles, the need to undershoot with a second vessel, and high mobilization rates all but killed Petro-Tech's chance at obtaining the data it desperately needed to take the company forward.
During the search for a seismic acquisition company, Petro-Tech had been advised of a Russian project in which ordinary supply boats and even fishing boats had been rigged successfully to acquire 2D seismic data. Petro-Tech's upper management, strong with marine experience, was particularly interested in this idea. Further research turned up the fact that virtually all of the high tech gear that makes up the seismic industry is available for purchase off the shelf.
After carefully running the numbers, it began to make sense to outfit a vessel to acquire the much needed 3D data within the Petro-Tech concession. Although this was strictly against the convention of the day, industry experts were contracted and a suitable vessel was selected from the small fleet of supply boats already owned by Petro-Tech. The boat was outfitted in late 1997 in Texas and underwent extensive field tests in the Gulf of Mexico prior to sailing to Peru early the next year.
The vessel is outfitted to tow three streamers of up to 3,200 meters in length to record six CDP lines from a dual source. The state of the art digital recording system is one of the latest in the industry and the recorded data to date has been of excellent to superior quality. The vessel also sports the latest in high tech navigation systems and acoustic networks. The boat itself is an old workhorse that boasts 3,600 hp from two main engines, and has been upgraded with the latest communication and radar equipment.
Does the vessel meet the needs of our small company? Absolutely. In a simplistic view of a seismic boat, one sees three main components: the boat, the deployment and retrieval system, and lastly the seismic gear. Petro-Tech officials made one very interesting observation. Once the streamer is in the water, gliding along at 4-5 knots, recording acoustic reflections, it is totally blind to the fact that a 20-year-old supply boat is doing the towing, and not a $50 million super-boat.
For an oil company's point of view, owning a seismic boat has been a bittersweet experience. Let's explore the bitter side first. A prudent oilman would never spud a well with a drilling rig unless all of the mud materials, tubular, wellhead equipment and other associated bits were purchased, in country and readily available. For Petro-Tech, the daily spread of a drilling operation is roughly equal in cost to the daily operational rate of the seismic vessel.
It is not economic to maintain a large inventory of spare parts, especially in light of the fact that most of the equipment that ends up damaged or lost is expensive. Lose a cable leveler and $10,000 slips away. Nick a cable and one spends $5,000 to have it re-skinned. Every in-water component is designed to withstand the harsh environment of the world's oceans, making them specialty items in most cases. The fact is one cannot run to the local hardware store to replace damaged parts, and that the smallest of items can stop the vessel from working. This fact alone has put a burden on the company's logistics department, as most everything seismic-related must be fast-tracked.
Boats in general, and seismic boats in particular, do not fair well when tied up to a dock. It is far better to keep the vessel working. Once the gear is retrieved from the water, deterioration begins almost immediately. Recently, Petro-Tech put the vessel out for hire on the commercial market to move the daily cost out from under the oil company during evaluation periods and just as importantly to keep it working.
The vessel requires a crew of specialists most of which have worked for the larger companies with large comfortable vessels. Replacing any one of them with someone that fits into this elite niche group is often challenging. The individuals that Petro-Tech employs to run the vessel are all tops in their prospective fields and replacing them never comes easy.
The biggest advantage of owning a seismic vessel is the fact that we have the latitude to fine tune the vessel to each individual acquisition area. Historically, Petro-Tech's production comes from a problematic area where hard bottom multiples rendered much of the early spec data useless for exploration purposes. With the time element removed, the vessel has researched a variety of different array configurations to come up with solutions to most of Petro-Tech's complex acquisition problems.
With a million acres to explore, having the vessel has given Petro-Tech the ability to move around to different areas and logically develop an area with repeated or remedial shooting to better tie down the extent of newly discovered prospects. Initial areas of interest were identified with gravity and magnetic surveys, proven with initial 2D investigation and then later refined with additional 2D.
Some of the more promising prospects are being further investigated with 3D acquisition. Another very important point the company has discovered is that sometimes 2D is enough to fully evaluate an area. This alone saves millions, even when the company owns the boat.
Petro-Tech now has a backlog of prospects that are currently being put into priority order and evaluated. It is expected that exploration drilling as a result of these new discoveries could begin as early as this year. Petro-Tech is already looking at structures that, if proven oil productive, could pay back the cost of the seismic vessel 50-fold. Petro-Tech is not advocating that everyone should follow the same path, but the small company's gamble is paying off.
The vessel is and continues to be a commercially viable asset, despite the weak condition of the seismic industry. Although the Gulf Supplier is not considered competition to the large multi-streamer vessels, it does have a very competitive niche in acquiring transition zone and small job acquisitions of 100-300 sq km. Additionally, high-resolution acquisition has been exceptional in quality.
James R. Huntis Technical Services Manager for Petro-Tech Peruna S.A. (Email: jameshunt @amauta.rcp.net.pel.)