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NEWS FROM SPE ATCE 2013 Deepwater Gulf is back on track, declares SPE panel

BY KURT ABRAHAM, Executive Editor

NEW ORLEANS -- With activity returning to more-normal levels and investment levels increasing, the deepwater Gulf of Mexico (GOM) is poised to become an even more important component of the U.S. energy mix. That is the consensus opinion declared by panelists during the Opening General Session of SPE’s Annual Technical Conference in New Orleans this morning.

“We’re expecting 17 deepwater rigs to enter the Gulf between now and 2015,” said Lars Herbst, Gulf of Mexico regional director for the U.S. Bureau of Safety and Environmental Enforcement (BSEE), within the Department of the Interior (DOI). “There are 10 deepwater projects either underway or sanctioned, and another eight that are discoveries undergoing appraisal.” Herbst noted that several challenges face the deepwater segment of the offshore oil and gas industry, including “HPHT, BOP stack technology, and personnel experience. We also must address risks that include metallurgical failures, dynamic positioning failures, and well control. We must remember that a small component can cause a big failure.”

John Hollowell, executive V.P. for Deepwater at Shell Upstream Americas, noted that his firm has an “industry-leading portfolio” in the GOM. This includes seven field  structures operated, that are highlighted by the recent arrival of the Olympus platform. “It’s hard to believe, but it’s already been 20 years since installation of the Auger platform,” said Hollowell. “We continue to mature discoveries at Appomattax, Vito and Stone.” He predicted that deepwater GOM water depths will continue to go deeper, while reservoir depths will also go deeper. Hollowell also expects reservoir temperatures and pressures to go higher. Accordingly, wells and subsea systems will be more complex, and they will be more abundant.

FMC Chairman and CEO John Gremp said that two-thirds of his firm’s $6.2 billion in revenue is subsea-driven. “We have about 50% of all the subsea technology market,” said Gremp. By 2020, he believes that 27 MMbpd of additional global oil production will be needed, and 10 MMbpd will have to come from deepwater fields. One factor in that scenario is that deepwater recovery rates are only about half of what they are onshore. “We need to increase reservoir recovery rates in the deepwater offshore,” said Gremp.

Moe Plaisance, V.P. Contracts and Marketing, for Diamond Offshore Drilling, noted that one of the most significant factors in deepwater operations is the entry of greater numbers of new-generation rigs. However, not all of them, “by a long stretch,” are built specifically for harsh environments, said Plaisance. “Many of the rigs being built today are not for harsh environments. Instead, they are being tailored for specific regions, to be as cost-effective as possible. That having been said, we (Diamond) are having a rig built right now for use in a harsh environment, south of the Australian Bight.”

The fifth and final panelist, Richard Wood, president of Completions & Production at Baker Hughes, built on some comments by Hollowell and chose to be more specific. On bottomhole pressure, he expects deepwater wells to generate numbers in excess of 25,00 psi. He also predicts bottomhole temperatures higher than 300oF. “We are going to see water depths of 10,000 ft in the Gulf and formation depths as great as 30,000 ft.” He added that by 2020, there will be more than 8,000 deepwater oil wells producing worldwide, with the vast majority of them along the Atlantic Rift.

All five panelists listed manpower as a prime concern. “We will have to continue to invest in our people, to ensure the accomplishing of these complicated projects,” said Hollowell, “if deepwater production is to continue to play a prominent role in supplying energy to the country.” Plaisance said that the industry needs to do a much better job of attracting younger people. “We haven’t exactly been advertising how good it is to work in this industry. There aren’t many industries, where people can make $100,000-plus per year and travel to some really exciting places, to work and do these projects. We have got to make young people aware of the great opportunities that we have in this industry.”

09/30/2013

 

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