Petro Rio S.A. HRTPF

Production Facilities

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There have been some questions regarding facilities required to produce hydrocarbons. Here is a quick summary:Oil: Facilities required to produce oil are not as complicated or expensive as those for natural gas. The most basic facility required is a tank battery. Depending upon the fluid produced, for example clean oil with a low gas-oil-ratio, can be produced directly into tanks on the wellsite. If the oil pool is located over a relatively large area, a gathering system of pipelines will be required from the wells to a central processing facility. The next requirement would be transportation for the oil either in pipelines or trucks. In the case for the amazon, trucks are not an option. At minimum a pipeline to the nearest river where the oil could go on barges would be required. Otherwise the oil will need to go into a dedicated pipeline that transports it to the appropriate market or facilities.If there is any amount of water produced with the oil then a separator on the lease is required prior to sales oil going into the tank. This consists of a vessel that heats the produced fluid to a level that the oil and the water will separate. The water then has to be disposed of, typically in a dedicated water injection well that is tied into the lease. Separate tanks are set up and the water is injected using high pressure pumps if required.If there is significant gas produced with the oil then additional, much more expensive facilities will be required. At best, some of the gas may be flared if the volume is not substantial. However, if the gas oil ratio is relatively high, then the gas will, by regulation, need to be conserved. As there are really no facilities near the operations, the gas will need to be re-injected into the reservoir. This will require dedicated facilities on the lease including a compressor, an injection well and a dehydration unit. This compressor is not a compressor for delivering the gas to a pipeline, but is for injection purposes only and should not be confused with a compressor station required to put gas into a dedicated pipeline.Contrary to what was suggested in a previous post, a pumping station and a compressor station are not the same facility and serve entirely different functions.Operating in remote areas where infrastructure is scarce is difficult and expensive and will take a considerable amount of time to put in place. Operating costs will be high and will represent a significant portion of the budget.More on gas facilities in a later post.