related article..............................Once again courtesy of cpb007:
Not a recent article, but I hadn't seen it before. Interesting last two paragraphs in view of OIL's 12 month contract for the Sedco712:
from: Asian Oil & Gas
by: Darius Snieckus
Probabilistic theory may have its doubters, but you won't find any at Oilexco or Transocean after the driller used software developed by probabilistic pioneers the Peak Group to appraise an oil structure on a central North Sea block operated by the Canadian indie. Darius Snieckus talks to Peak's Andrew Paterson about growing belief in the 'Monte Carlo' model.
For Peak Group chief executive Andrew Paterson, the importance of applying probabilistic theory to the North Sea goes far beyond drilling. The take-up of the Aberdeen-based company's P1 and C1 software, designed to streamline cost and time estimation, risk analysis, option selection and planning in the well construction process, he suggests, speaks to a deeper need in the maturing offshore province to find 'systems that allow the users to define what will deliver best value'.
'Companies in the UK North Sea have become expert in cutting cost, which is fine to a point, but what they should be doing now is creating new business models,' he offers. 'The probabilistic approach is a process that allows [the operator and its drilling contractor] to more objectively compare options - contractual, technical and procedural.
'And,' he adds, 'this should give power back to the user of the system rather than the buyer who would be mainly concerned with the cost of the software and not the value. Probabilistic software allows the user to forcibly and compellingly articulate where value lies.'
This shift in well construction philosophy, Paterson believes, will extend the producing life of the North Sea by honing drilling efficiencies and so 'deliver more value, that is, more revenue' for the province's oil companies, contractors and, ultimately, the UK itself.
Adoption of the probabilistic approach has been aided and abetted by the rise of a new order of Canadian independent operators, 'without question the most receptive audience to new concepts and best prepared to take on new ideas'. With indies such as EnCana, CNR and Talisman down to some of the newest entrants, like Oilexco, influencing the future of the North Sea, Paterson feels the offshore province has 'lucked out'.
'These companies use more lateral thinking and are very receptive to new ways of doing business, and that can only be good for a region that needs new models of operation,' he states.
It may well prove the case that the smaller fish in the pond do increasingly set the pace for change in the North Sea. This is partly due to the fact that because many of the new independents do not have the infrastructure or 'critical corporate mass' of their larger brethren, they are likely to be more reliant on stronger ties with their drilling contractors, which in turn are placing greater emphasis on 'well delivery' using innovative approaches including probabilistics.
'I hope we will see drilling contractors in this market starting to deliver wells in which there is a much better understanding of where risk is most appropriately assigned between the drilling contractor and the operator and how control should be assigned and when relinquished,' says Paterson.
In this commercial environment, he notes, the drilling and service contractors 'will be doing much more' and exerting greater sway, ensuring experience gained on one well becomes a learning point for the North Sea as whole.
Oilexco is one of those operators flying the flag for the probabilistic approach - and breaking down old notions of 'how the well constructor works'. Working in a 'partial turnkey relationship' with driller Transocean, Peak was involved in drilling four wells and three sidetracks at Oilexco-operated block 15/25b, a 20th round award in the Outer Moray Firth where it holds a 100% working interest.
Using Peak's P1 software, the drilling campaign resulted in four wells striking oil. During drill stem testing, three wells - 15/25b-6, 15/25b-8 and 15/25b-9Y - flowed 40°API oil at rates of 2980b/d, 4785b/d and 2648b/d respectively, on restrictive chokes at reservoir sand face pressure draw downs of less than 10%.
'Speaking to an independent like Oilexco, you are speaking to businessmen who immediately like the understanding that they get, in terms of business exposure, from a probabilistic approach - and how we can influence performance by using this process,' explains Paterson.
The larger significance of this first excursion into the emerging indies market, he adds, is that it provides a precedent for Peak to serve as a medium that 'creates a relationship between an oil company and the drilling contractor that allows both parties to understand the risks presented by a campaign and to assign the control during the well construction to where it is best placed'.
Independents are not alone in their interest in probabilistics. After hosting a first-ever probabilistic well construction workshop in Aberdeen late last year, Peak has found itself involved in two further events - one in Aberdeen, one in Houston - hosted by oil major Shell. Among the lessons learned from these workshops, says Paterson, is that while there are 'gurus [within the major oil companies] very well-versed in what probabilistic concepts can deliver', the approach and philosophy has not yet been 'disseminated down to the field'. BP has committed to hosting the third European workshop in October.
Nor is probabilistics a technique that is difficult to export, to judge by a recent agreement with another Canadian independent, Antrim, to use the Peak P1 software in a drilling campaign offshore on Australia's North West Shelf, and one with Nexen to use P1 and C1 on exploration projects in Colombia and off Equatorial Guinea. Showing some foresight, Peak got a jump on this growing international demand by last year opening new offices in Houston, Jakarta and Perth.
Whether in the North Sea or offshore Indonesia, 'what influences the outcome of a project is so complex that intuition does not consistently lead you in the right direction,' stresses Paterson.
'That is why you have to develop processes. There are so many variables - contractual, environmental, human, those linked to the reliability and design of equipment - that go in to a simple well and that means that instinct will not necessarily lead to understanding where risk lies and, therefore, what you can do to offset that risk,' he states.
As for the North Sea in particular, Paterson underlines that industry 'will never drill better wells by having rigs stacked and calling in drilling contractors for one- or two-well programmes'.
'We need continuous drilling programmes to drill cheaper wells,' he concludes. 'The benefits will be higher revenue, and more innovation from those companies that are most innovative - most of which are in the service sector and many of which are SMEs.' Probabilistics, seeing ever-wider take-up, promises to help the North Sea offshore industry in this direction. AOG