Using Risk-based Simulation Models to Assist in Planning Deepwater Exploration and Production Programs West of Shetland and in the Gulf of Mexico

Abstract

This paper describes the use of process simulation models to evaluate alternative drilling programs, and specifically to quantify the band of uncertainty in time and cost. The discussion also includes consideration of the interaction between the drilling program and the selection, design and installation of the process facilities. It is recognized that deepwater drilling operations are complex and risky endeavors. The cost of these drilling operations can represent a very significant proportion of the total field development, and so it is essential to understand the causes and magnitude of this risk. Modeling using Monte Carlo simulation is a natural tool to assess these risks and has been available for many years but, owing to the complexity of building and maintaining the models and evaluating the results, it has not often been applied to deepwater drilling. The authors have used the SLOOP simulation software to assist in planning and evaluating deepwater programs both West of Shetland and in the Gulf of Mexico. These were used to help plan an exploration program, and to evaluate alternative development drilling options. They were also used to help evaluate spar platform alternatives for a Gulf of Mexico field development. A key consideration in using simulation is the presentation and evaluation of the results. Presenting risk-based evaluations in a meaningful and concise format is difficult. With the use of SLOOP and interfaces to spreadsheets, ARCO and Vastar (now both merged into BP) and BMT have developed an approach which provides the results in a compelling and concise manner. The simulation results presentations were key ingredients in planning the West of Shetland Block 204 exploration program and in selecting the final development scenario for Horn Mountain. Introduction Deepwater operations are complex and risky endeavors. Specifically, it is very difficult to estimate the impact of the metocean environment (wind, wave and current) on drilling operations. This is particularly important in areas with harsh conditions, as it is essential to understand the magnitude and causes of the risk, in terms of both timing and cost. Modeling using Monte Carlo simulation is a natural tool to help quantify the impact of this type of risk. Though the method has been available for many years, it has not often been applied to operations such as deepwater drilling, but with the availability of fast and very economical computers and the development of convenient simulation software, simulation can now readily be applied to deepwater operations In this paper we discuss the use of this simulation model by ARCO and Vastar (now both merged into BP) to assist in planning and evaluating deepwater drilling programs both West of Shetland and in the Gulf of Mexico. For the West of Shetland operations, simulations were performed to plan the exploration program and to evaluate alternative development options. In the Gulf of Mexico, Vastar recently used the simulation to model alternatives for the Horn Mountain development options.

The impact of weather and ocean forecasting on hydrocarbon production and pollution management in the Gulf of Mexico

“…The occurrence of a hurricane warning or alarm is enough to disrupt drilling operations and a significant amount of operating time can be lost to ''false alarms'' (Barrilleaux et al, 2001;Corona et al, 1996;Rowe et al, 2001). In deepwater operations, loop currents and the eddies may damage drilling strings/risers and impact the drilling schedule (Epps, 1997).…”

Modeling the time and cost to drill an offshore well

“…Weather downtime can impact drilling operations in various ways; e.g., weather too severe for operations involving supply boats may lead to delay if stock levels on the rig decline to a critical level; weather may impact anchoring up and moving time; weather may be too severe for drilling to occur; and extreme weather may result in damaged or lost drill strings and risers. If operating limits are exceeded because wave heights, ocean currents, or eddies are too strong, drilling operations will be temporarily abandoned and resumed when conditions fall within the operating capabilities of the equipment [25]. Waiting on weather WOW time needs to be considered separate from the drilling time and cost metrics.…”

Estimating the Economic Benefits of Regional Ocean Observing Systems

“…The occurrence of a hurricane warning or alarm is enough to disrupt drilling operations, and a significant amount of operating time can be lost to "false alarms" [18][19][20]. In deepwater operations, loop currents and eddies associated with them are also common phenomena that may damage drilling strings/risers and impact the drilling schedule [21].…”

“…The Outer Continental Shelf (OCS) 20 of the Gulf of Mexico (GOM) is the most extensively developed and mature offshore petroleum province in the world. More than 40,000 wells have been drilled in the OCS since offshore production began in 1947, and there are currently over 4,000 active structures in water depths ranging up to 7,000 ft. About 25 percent of the United States domestic oil and gas supply comes from the OCS, and in 2002, OCS lands averaged daily production of about 1.6 million barrels (MMbbl) of oil and 14.5 billion cubic feet (Bcf/d) of natural gas.…”

“…The Loop Current is an offshoot of the Gulf Stream, a major North Atlantic Ocean boundary current located off the east coast of the United States. The loop is 20 The OCS of each coastal state generally begins 3 nautical miles from shore for all but two states -Texas and Florida -which are 3 marine leagues (9 nautical miles), and extends at least 200 miles through the Exclusive Economic Zone. 21 Although oil and gas production in the heavily leased shallow waters of the GOM has been steadily declining, the MMS estimates that there is up to 55 trillion cubic feet (Tcf) of natural gas still available in the deep shelf areas.…”