What's new in production

Jan. 2002 Vol. 223 No. 1  What's New in Production

Perry A. Fischer,  Engineering Editor

Aiming for 550,000 bopd. Calgary-based Suncor Energy is finalizing its US$2.05-billion Project Millennium, which should nearly double the firm’s heavy-oil output capacity to 225,999 bpd. A $790-million cost overrun has not deterred the company from planning even grander production goals.

In November, regulatory approval was granted to Suncor’s $630-million Firebag development, located near current Alberta operations. That development is a massive 400 mi² steam-assisted gravity-drainage (SAGD) project that should add 35,000 bpd of bitumen production by 2005, increasing to 140,000 bpd by 2010.

The company is keen to reduce its environmental impact, and the SAGD method helps accomplish that. The physical plant structure is expected to disturb less than 10% of the surface area over the deposit. Recycled water from wastewater streams at the oil-sands plant will be used, while steam will be generated with cleaner burning natural gas. The company is studying injection of CO₂ and light hydrocarbons into the deposit to further decrease emissions and reduce the amount of natural gas needed to generate steam.

The company’s Voyager project aims to double production capacity again, to 550,000 bpd, within a decade. Voyager is still in the planning stages, with costs not well known, but estimates are about $6 billion, spread out over 10 years. Regulatory approval will not be sought until late 2002. The Voyager plan, added to other investments, means that as much as $25 billion could be spent on Canadian oil sands projects by 2015.

First oil. TotalFinaElf began production from Huldra gas and condensate field in the Norwegian sector of the North Sea. The field is located about 93 mi northwest of Bergen in 410 ft of water. Huldra will have a daily peak production of about 350 MMcfg and 30,000 bbl of condensate. Four wells have been drilled, with two others scheduled for 2002. Huldra platform is equipped with a processing and separation unit but is unmanned. The gas is sent through the Norwegian transportation system to the Continent, while the condensate is transported to the Sture terminal, near Bergen.

TotalFinaElf also saw first oil in early December from the deepwater Girassol field on Block 17, offshore Angola. Girassol is located roughly 125 mi northwest of the Angolan capital of Luanda in 4,500 ft of water. The development comprises subsea wells tied back to an FPSO that can process 200,000 bopd, and has a two-million-bbl storage capacity. A total of 39 subsea wells are planned, with drilling expected to continue until 2003. TotalFinaElf, operator, has a 40% interest in the Girassol development. Its partners are ExxonMobil (20%), BP (16.67%), Statoil (13.33%) and Norsk Hydro (10%). State-firm Sonangol is the concessionaire for the block.

However, as Girassol comes onstream, Angola’s oil minister, Jose Maria Botelho de Vasconcelos, said that Angola would probably cut output in January to help OPEC keep oil prices up. He did not offer any figures, nor say where or by whom the cuts would be made. "Our intention is to show solidarity with OPEC," he stated. "We will cut something from our production, but we will need to talk to all of our partners" before making a formal decision. Angola’s oil production has quadrupled to about 750,000 bpd since independence from Portugal in 1975. The minister said the country might have trouble balancing its budget if oil prices fall below $17. If non-OPEC producers join the group to cut 1.5 million bpd, prices may stabilize at $20 to $21 a barrel, he said.

Simulating gas production from hydrate. Westport Technology Center Int’l., an independent E&P service lab owned by Halliburton Energy Services, has been awarded a DOE contract to characterize gas hydrate reservoirs and develop simulators for methane gas production from Gulf of Mexico hydrates. The $820,000 contract will help expand the current understanding of gas hydrates through experiments and computer modeling.

"Naturally occurring hydrates may be a detriment to the development of conventional hydrocarbon resources; however, methane production from these now troublesome zones may become a new and important hydrocarbon resource for the future," said Jody Powers, president, Halliburton Energy Services. Under the DOE contract, four major tasks will be completed:

• Identify and measure petrophysical properties needed to characterize methane production from a hydrate reservoir, typical of the Gulf of Mexico
• Quantify the effect of sediments on such petrophysical properties
• Develop a model to integrate lab petrophysical data to estimate reservoir and well productivity
• Develop a hydrate-reservoir simulator by integrating the reservoir-simulation and acoustic-velocity models developed in this project with its in-house gas-hydrate control model for deepwater drilling operations.

First heavy oil. Phillips Petroleum and its Hamaca Project partners saw first oil from the field, located in Venezuela’s Orinoco Belt, which contains the world’s largest hydrocarbon deposit. This marks the first phase of production, currently 30,000 bpd of 8.5°-API gravity crude, which is then blended with lighter crudes. Production from Hamaca field will be significantly enhanced when an upgrader unit, currently being constructed at the Jose industrial complex on the northern coast of Venezuela, is brought onstream in early 2004. At peak field production of 190,000 bpd, the upgrading process will yield 180,000 bpd of 26°API crude.

The Hamaca Project area comprises 254 mi² and is estimated to contain 2.1 billion bbl of recoverable oil over the project’s 34 year life span. The $4-billion joint venture comprises Phillips Petroleum (40%, operator), ChevronTexaco (30%) and PDVSA (30%).

Caspian pipeline opens. The Caspian Pipeline Consortium terminal near Novorossiysk, Russia, celebrated the opening of a new oil export route from the Caspian region. The 900-mi pipeline, built from Tengiz field in western Kazakhstan to the Black Sea port of Novorossiysk, commenced tanker loading in November. The $2.65-billion pipeline will be able to carry up to 600,000 bopd by mid-2002. It will allow ChevronTexaco to maximize its investments in the supergiant Tengiz oil field and the gas condensate Karachaganak field, both in Kazakhstan.

Comments? Write: fischerp@gulfpub.com