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OilSim day 2 Licence award, spread risk-negotiations 3D seismic maps Task 3 yesterday Todays Challenges Exploration & appraisal drilling Drilling rigs,

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Presentation on theme: "OilSim day 2 Licence award, spread risk-negotiations 3D seismic maps Task 3 yesterday Todays Challenges Exploration & appraisal drilling Drilling rigs,"— Presentation transcript:

1 OilSim day 2 Licence award, spread risk-negotiations 3D seismic maps Task 3 yesterday Todays Challenges Exploration & appraisal drilling Drilling rigs, Suppliers for The drilling phase Recovery factor, Depletion strategy Number of wells, Tube size Task 4 Task 5 Depletion plan & prodution profile

2 Single Rigs Double Rigs Triple Rigs

3 Max drilling depth is important Rig cost = drilling days * day rate

4 Base camp (accomodation, cantine,+storage of equipment) Transport on land, cars/trucs Transport by air (personnel, equipment) Well services (pipe, casing, drilling mud Well analysis (electrical logs, cores)

5 Upto 9 Star quality- Good: normally costs more Bad: cheaper, but reliability is low, so you risk extra drilling time and extra costs

6 EIA survey: more knowledge about the area. Less probability for drilling problems. Less severe consequences if you run into problems.

7 EIA: enviromental impact analysis shows where it may be difficult to drill. Place your mouse where to drill

8 Layer 1 Cretaceous Layer 2 Paleocene Layer 3 Eocene

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11 Proven volume (MBOE) counts Test may increase proven volume Remember to tick the boxes!

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14 Volume Range, e.g. 1-897 Proven Reserves e.g. 1

15 The total proven oil and gas = 18MBOE Allowing for 25% recovery factor 0.8 Production profile factor and 10% discount factor per year

16 18MBOE x 25% recovery factor = 4.5MBOE Sales price without discount factor ->4.5MBOE x $50 = $225,000,000 Sales price allowing for production profile -> $225,000,000 x 0.8 (production factor) = $180,000,000 Reduced sales price with 10% discount factor per year = $ 67,397,022

17 From Probable volume to proven reserves

18 Exploration well: 0 to 1572 MBOE (after drilling) 11 to 1266 MBOE (after testing) First appraisal well: 25 to 1033 MBOE (after drilling) 34 to 910 MBOE (after testing) Second appraisal well: 65 to 850 MBOE (after drilling) 101 to 752 MBOE (after testing) Only proven MBOE counts

19 Appraisal wells - proven reserves increase Range between proven and possible is decreased

20 Expected costs if you developed the field (CAPEX) and produced the oil (OPEX) Now total expenses are lower than the sales value and so we have a positive licence value

21 After your first drill in each well, reprocess seismic Decide which discoveries to drill how many appraisal wells into Ultimately, you should either: Get a positive net present value, Or a conclusion that additional appraisal wells will not result in a net present value

22 Click on Apply for More Funds Tab. 1 KP for each $100,000 applied for. Answer the questions: All correct gives cash and you can keep CPs. One wrong gives cash and you keep ½ of your CPs. Two wrong gives ½ cash and you lose all CPs. All wrong, you get no cash and lose all CPs. Expensive money if less than 10 knowledge points: Apply for cash and be fined $5million for each $20million requested.

23 Licence award, spread risk-negotiations 3D seismic maps Task 3 yesterday Todays Challenges Exploration & appraisal drilling Drilling rigs, Suppliers for The drilling phase Recovery factor, Depletion strategy Number of wells, Tube size Task 4 Task 5 Depletion plan & prodution profile

24 Make a well plan for each reservoir in your block, choosing: Number of production wells Tubing size Aiming to choose a plan that maximises value of block Increased sales value Decreased drilling costs

25 Highest well flow rate Read the maximum well flow rate Most suitable Tube size Most suitable tube

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27 1. Click the Reservoir tab 2. Click the magnifying glass for the reservoir 3. Study the data for the reservoir

28 Click on Drilling Rig

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32 1. Submit plans with different number of wells and tubing sizes 1. Review Reservoir information after each revised plan 2. Aiming to maximize sales value and minimize drilling costs, whilst increasing Recovery Factor 3. You can amend your well plans until the deadline 4. Credibility points – upto 100 kp if plans are optimal for all your reservoirs 5. After deadline – Value of Licence will be adjusted based on final Well Plan submitted

33 Results Input data Gross rock volume Net to Gross Porosity Hydrocarbon saturation Oil shrinkage / Formation volume factor Gas-oil-ratio GRV x N/G x Phi x Shc x Bo/FVF x GOR = In-Place resources In place resources x Recovery factor = Recoverable oil/gas Minimum – Most likely – Maximum - of each parameter Monte Carlo simulate in GeoX P90 – Mean – P10 recoverable resources


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