August 1999 Vol. 220 No. 8  Drilling

Robert E. Snyder,  Editor

Deep/deepwater wells, rig attrition, new bits

It isn’t often, anymore, that billion-barrel fields are discovered — the norm is more like 50 to 100 million. But then BP Amoco is not your normal oil company. In mid-July, the company announced four major deepwater finds in the Gulf of Mexico. The largest of the four is the Crazy Horse prospect in 6,000-ft water in the Boarshead basin, 125 mi SE of New Orleans, Louisiana. Reported reserves for the new field are one-billion barrels oil equivalent — the largest discovery in the deepwater U.S. Gulf. BP Amoco is operator, with 75% interest, Mobil holds 25%.

The other three discoveries are located in 4,000 to 6,500-ft water in Southern Green Canyon, 150 miles south of New Orleans. Also operated by BP Amoco, the three prospects and partner interests are: Atlantis (BHP 44%); Mad Dog (BHP 11.44%); and Holstein (Shell 50%). For the operator, these three discoveries add about 600 million boe net reserves. To cap these achievements, the company also announced a discovery in Block 18 in 4,500-ft water off Angola with the Plutino well, close to Platina find, 110 miles offshore. BP Amoco operates Block 18, with Shell (50%).

So why is this drilling news? It has been reported that the Crazy Horse well was drilled a TVD of about 24,000 ft from the Transocean drillship Discoverer 534. The drilling of deep wells in ultra-deep water is a growing technical challenge, and the story of how they did it must be extremely interesting. World Oil delves into this process with an article by Vastar’s John Barker — in this issue’s separately bound Deepwater Technology supplement — on equivalent circulation density management in deep, deepwater wells.

Heading for the scrap heap. Following up on The Oilfield Appraiser’s earlier comments on rig cannibalizing, the latest newsletter says it expects to see 150 or more U.S. drilling rigs scrapped or dismantled, and perhaps 300 well service rigs scrapped or retired this year. Owners say they will avoid selling rigs, or parts thereof, to reduce the number on the market.

Rig attrition is a "positive value factor," the report says. When the industry does turn around, the problem will not be the number of rigs available, it will be — as it was in 1997 — finding people to run them. The overall industry is shrinking "at an alarming rate due to serious financial attrition." And loss of experienced people is a very real problem.

Slow turnaround offshore. The best news Global Marine could come up with in its monthly SCORE (Summary of Current Offshore Rig Economics) report is that the rate of decline has slowed. SCORE compares economics, as a percent, to those of the 1980–1981 period when dayrates allowed new rigs to be build on spec, i.e., 100%.

The June worldwide SCORE for all types of offshore rigs fell to 23.2%, from 26% in May. The June SCORE is a 67.8% decrease from June 1998, a 30.6% decrease from the same period five years ago. For the U.S. Gulf, SCORE decreased to 19.2%, from May’s 22.3%; this is a 67.9% decrease from June 1998 and a 43.8% decrease from five years ago. The North Sea fell to 23.6% in June — down 71.8% for the one-year period, 22.8% from five years ago. And West Africa fell by 18.4% from May to 29.6% in June — 60.2% down from last year.

For jackups, with an 8.9% decrease from May, the 22.8% June SCORE has decreased 71.3% in a year, 39.6% in five years. Semis dropped to 23.6% in June, 64% in one year and 15.1% from five years ago. Global says it believes the jackup market in the U.S. Gulf has bottomed out. Several independent operators have reported plans for increased drilling activity in the second half. Few majors, conversely, have committed to increasing second-half spending.

Bit research. The Gas Research Institute’s Spring 1999 Grid publication features a report on GRI/Industry efforts to develop more efficient hard rock bits. Three designs are discussed: 1) rotating discs, 2) thermally stable diamonds, and 3) helical drag types. Mike Weiss, Principal Product Manager, Drilling / Completion Technology, says, "Because drilling for gas is taking place at increasing depths, more efficient hard rock bits are needed. As operators drill deeper, drilling slows as rock chips accumulate, resulting in the redrilling of the chips themselves instead of new rock."

Disc cutters have long been used in the tunnel boring industry. Unlike conventional bits, these cutters use blunt-edged rotating discs that tunnel through rock. Recent design changes suggest that development / marketing of a low-cost, fast-cutting bit for hard-rock drilling based on disc cutter technology is possible. GRI-sponsored work has already resulted in downsizing tunnel boring technology to smaller bits that accommodate gas drilling.

Preliminary testing of a disc cutter bit has been completed and is encouraging. As a result, the prototype’s bearing structure has been re-designed to allow higher WOB. GRI and partner, Excavation Engineering Associates, Seattle, Washington, plan to field test the new design this year.

For diamonds, The long-term research objective is a bit with TSP (Termally stable product), a synthetic diamond material bonded to tungsten carbide cutters. Work with Technology International in Houston suggests such a product could outperform more traditional PDC bits in penetration rate and bit life. TSP disadvantages are its brittleness and lower impact strength. This GRI project is investigating the feasibility of attaching TSP onto tungsten carbide.

The helical drag bit is expected to contribute to more productive drilling in the growing horizontal, slimhole and coiled tubing markets. This new concept was developed and patented by UTD Inc., Manassas, Virginia. The innovative feature of the bit is its ability to provide its own thrust or weight on the bit, removing the need to apply force from surface. Under GRI sponsorship, UTD is continuing to develop the concept. Recently completed theoretical / lab studies indicate the bit is both feasible and practical.

For more information on disc bits and TSP, contact Mike Weiss, tel: 773 399 5484, fax: 773 399 8170; E-mail: mweiss@gri.org. For the helical drag concept, contact Brian Gahan at GRI: tel: 773 399 5481; fax: 773 399 8170; E-mail: bgahan@gri.org.

Copyright © 1999 World Oil
Copyright © 1999 Gulf Publishing Company