Considering economic and geological uncertainty in the simulation of realistic investment decisions for CO2-EOR projects in the North Sea

Welkenhuysen, Kris; Rupert, Jort; Compernolle, Tine; Ramírez, Andrea; Swennen, Rudy; Piessens, Kris

doi:10.1016/j.apenergy.2016.10.105

Cited by 58 publications

(35 citation statements)

References 44 publications

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“…High risk is one of the most distinguishing features of international oil and gas (OG) projects. Suslick and Schiozer (2004) and Welkenhuysen et al (2017) suggested that geological risk, economic risk and engineering risk should all be considered because they influence the exploration and development of OG projects. As both geological risk and engineering risk affect the uncertainty of volumes and production plans of oil and gas projects, we propose to use resource risks to represent geological risk and engineering risk.…”

Section: Introductionmentioning

confidence: 99%

“…However, the probability of different scenarios cannot be obtained. (4) The minimum expected return rate method, which aims to estimate the minimum expected return rate of a project under given parameters (Weijermars et al 2017;Welkenhuysen et al 2017). Although this method can be used to estimate the benchmark, the corresponding confidence level cannot be obtained.…”

Section: Introductionmentioning

confidence: 99%

“…Khadem et al (2017) applied the probabilistic model to conduct quantitative risk management of an oil and gas project in Oman. Welkenhuysen et al (2017) applied a probabilistic model to evaluate a CO 2 -EOR project which faces oil price uncertainty, recovery rate uncertainty, CO 2 price uncertainty, and uncertainty of the mean value of the production curve. Weijermars et al (2017) used a probabilistic model to compare the return rate of shale blocks in the Eagle Ford in the USA and Mexico.…”

Section: Introductionmentioning

confidence: 99%

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Risk measurement of international oil and gas projects based on the Value at Risk method

et al. 2018

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International oil and gas projects feature high capital-intensity, high risks and contract diversity. Therefore, in order to help decision makers make more reasonable decisions under uncertainty, it is necessary to measure the risks of international oil and gas projects. For this purpose, this paper constructs a probabilistic model that is based on the traditional economic evaluation model, and introduces value at risk (VaR) which is a valuable risk measure tool in finance, and applies VaR to measure the risks of royalty contracts, production share contracts and service contracts of an international oil and gas project. Besides, this paper compares the influences of different risk factors on the net present value (NPV) of the project by using the simulation results. The results indicate: (1) risks have great impacts on the project's NPV, therefore, if risks are overlooked, the decision may be wrong. (2) A simulation method is applied to simulate the stochastic distribution of risk factors in the probabilistic model. Therefore, the probability is related to the project's NPV, overcoming the inherent limitation of the traditional economic evaluation method. (3) VaR is a straightforward risk measure tool, and can be applied to evaluate the risks of international oil and gas projects. It is helpful for decision making.

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Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Risk measurement of international oil and gas projects based on the Value at Risk method

et al. 2018

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“…The usefulness of geostatistics in fisheries has been well established (Morfin et al, 2012;Petitgas et al, 2014;Rufino, Gaspar, Maynou, & Monteiro, 2008;Rufino, Maynou, Abelló, Gil de Sola, & Yule, 2005;Rufino, Maynou, Abelló, Yule, & Gil de Sola, 2006;Saraux et al, 2014). Space-time geostatistics have been used in other research fields, such as high-resolution global temperature (Kilibarda et al, 2014), precipitation (Raja, Aydin, Türkoğlu, & Çiçek, 2017), economy (Welkenhuysen et al, 2017), disease mapping (Marek, Tuček, & Pászto, 2015), reconstruction of past conditions using tree ring data (Biondi, 2013), and parasite propagation (Hu et al, 2015), but to the authors' best knowledge, these methods have never been applied in the field of fisheries biology. On the other hand, the patterns of temporal series of continuous maps can be summarized using empirical orthogonal functions analysis, a method similar to a principal component analysis (PCA), and often used in meteorology, but in the spatio-temporal domain (Morfin et al, 2012;Petitgas et al, 2014).…”

Section: Introductionmentioning

confidence: 99%

Bivalve sanctuaries to enhance stocks along the Algarve coast of southern Portugal: A spatio‐temporal approach

Rufino

Vasconcelos

Pereira

et al. 2018

Aquatic Conservation

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Populations of marine bivalves are subject to large interannual fluctuations as a result of their sensitivity to unfavourable environmental conditions. These populations have a strong dependence on recruitment, which constitutes a risk to stock conservation and the sustainability of the commercially exploited species. Bivalve sanctuaries comprising no‐take areas can promote the restocking of large coastal areas as a result of the high fecundity and the potentially long‐distance larval dispersal of bivalves. The present study explores a novel spatio‐temporal approach to investigate suitable locations for bivalve sanctuaries, aimed at protecting and enhancing stocks along the Algarve coast in southern Portugal. In the context of small‐scale fisheries, bivalve dredging constitutes an important socio‐economic activity. Three bivalve species are targeted: the striped venus (Chamelea gallina), the donax clam (Donax trunculus), and the surf clam (Spisula solida). Data gathered from 36 bivalve fishing surveys conducted over three decades (1986–2015) were analysed using geostatistical methods, accounting for temporal and spatial autocorrelation to produce continuous prediction maps of species distribution for each survey. The approach taken permitted the use of all scattered historical data collected by different methods. The predictions were then used to summarize and illustrate the spatial distribution of species across time, in terms of average biomass, variability, and maximum potential biomass, and to delimit the areas as a function of the species persistence (recurrent, occasional, or rare). The temporal patterns through space were further investigated using empirical orthogonal function (EOF) analysis. The areas accounting for 80% of the species biomass were also estimated. Results of this set of analyses led to the proposal of locations for establishing bivalve sanctuaries, aimed at enhancing the stocks of commercial bivalve species in the long term. Such an innovative spatio‐temporal approach and management strategy is replicable in other fishing resources and geographic areas.

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“…The study also concluded that depleted gas reservoirs with low abandonment pressures and weak aquifer invasion, such as some reservoirs in the North Sea, are appealing for CO 2 sequestration as the CO 2 storage capacity could potentially equal the extracted gas volume. Many publications on CO 2 sequestration in depleted gas reservoirs have addressed different aspects, such as the CO 2 flow and trapping mechanisms, storage capacity, reservoir containment, risk assessment, and geomechanics [20][21][22][23][24][25][26].In this work, we investigate a serious flow-assurance issue that arises during CO 2 injection into depleted gas reservoirs when the abandonment reservoir pressure is below the CO 2 bubble-point pressure. This work is inspired by a potential CO 2 sequestration project in a depleted gas reservoir in the North Sea [27,28].…”

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confidence: 99%

Assessment of CO2 Injectivity During Sequestration in Depleted Gas Reservoirs

2019

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Depleted gas reservoirs are appealing targets for carbon dioxide (CO 2 ) sequestration because of their storage capacity, proven seal, reservoir characterization knowledge, existing infrastructure, and potential for enhanced gas recovery. Low abandonment pressure in the reservoir provides additional voidage-replacement potential for CO 2 and allows for a low surface pump pressure during the early period of injection. However, the injection process poses several challenges. This work aims to raise awareness of key operational challenges related to CO 2 injection in low-pressure reservoirs and to provide a new approach to assessing the phase behavior of CO 2 within the wellbore. When the reservoir pressure is below the CO 2 bubble-point pressure, and CO 2 is injected in its liquid or supercritical state, CO 2 will vaporize and expand within the well-tubing or in the near-wellbore region of the reservoir. This phenomenon is associated with several flow assurance problems. For instance, when CO 2 transitions from the dense-state to the gas-state, CO 2 density drops sharply, affecting the wellhead pressure control and the pressure response at the well bottom-hole. As CO 2 expands with a lower phase viscosity, the flow velocity increases abruptly, possibly causing erosion and cavitation in the flowlines. Furthermore, CO 2 expansion is associated with the Joule–Thomson (IJ) effect, which may result in dry ice or hydrate formation and therefore may reduce CO 2 injectivity. Understanding the transient multiphase phase flow behavior of CO 2 within the wellbore is crucial for appropriate well design and operational risk assessment. The commonly used approach analyzes the flow in the wellbore without taking into consideration the transient pressure response of the reservoir, which predicts an unrealistic pressure gap at the wellhead. This pressure gap is related to the phase transition of CO 2 from its dense state to the gas state. In this work, a new coupled approach is introduced to address the phase behavior of CO 2 within the wellbore under different operational conditions. The proposed approach integrates the flow within both the wellbore and the reservoir at the transient state and therefore resolves the pressure gap issue. Finally, the energy costs associated with a mitigation process that involves CO 2 heating at the wellhead are assessed.

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Considering economic and geological uncertainty in the simulation of realistic investment decisions for CO2-EOR projects in the North Sea

Cited by 58 publications

References 44 publications

Risk measurement of international oil and gas projects based on the Value at Risk method

Risk measurement of international oil and gas projects based on the Value at Risk method

Bivalve sanctuaries to enhance stocks along the Algarve coast of southern Portugal: A spatio‐temporal approach

Assessment of CO2 Injectivity During Sequestration in Depleted Gas Reservoirs

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