Maintaining Seismic-Focused Exploration During Downturn Yields Benefits

Abstract

This article, written by JPT Technology Editor Judy Feder, contains highlights of paper SPE 197213, “New Growth in an Old Basin: Successful Implementation of PDO’s Exploration Strategy in a Downturn,” by Nicholas Feast, Salim Rawahi, and Mohammed Mazrui, Petroleum Development Oman, prepared for the 2019 Abu Dhabi International Petroleum Exhibition and Conference, Abu Dhabi, 11–14 November. This paper has not been peer reviewed. A conventional industry approach is to curtail seismic activity during a downturn, focusing on limiting new exploration and drilling production wells instead. This paper demonstrates how maintaining investment in high-quality 3D seismic during the last downturn, together with selective exploration, quality geoscience, application of new technologies, and efficiently maturing discoveries to early cash flow, was successful in sustaining future production while deploying capital efficiently. Challenge in Oman Block 6 Investment in 3D seismic does not contribute to immediate cash flow and, when funds are scarce, is an early candidate for cost reductions. By mid-2014, the seismic sector was the worst-performing segment in the upstream industry. However, without continued investment in seismic, future exploration success is threatened. This poses a dilemma for energy companies as they balance short-term cash flow with long-term value generation. Petroleum Development Oman took the opposite approach in the mature Oman Block 6. The company reduced short-term exploration drilling and testing and focused on early production from near-term exploration plays for early monetization to partially fund exploration. It used recently acquired seismic data to pursue highly ranked exploration opportunities. Finally, it sustained investment in, and improved efficiency of, advanced seismic acquisition and processing to improve cost efficiency for future plays. Nevertheless, success through both oil and gas exploration was achieved. Enhanced short-term cash flow and improved capital efficiency resulted while significant commercial oil and gas volumes were discovered. During 2016–2018, 1.3 billion BOE were discovered, primarily in subtle and stratigraphic traps, and over 22000 km2 of new 3D wide-azimuth (WAZ) seismic was acquired (Fig. 1). The complete paper presents case studies from the Shammar, Mabrouk North East, and Rakid plays. Focused activity in the Shammar play added volumes while early hookup and production provided cash flow, repaying all Shammar drilling and testing costs within a year. A success rate of 100% in Mabrouk North East exploration and appraisal wells proved the potential of better seismic imaging in pursuing more-complex stratigraphic traps in deep reservoirs. Early monetization focus while implementing new seismic acquisition techniques with fast processing turnaround also opened new play potential. Discoveries in the Rakid field’s Permo- Carboniferous Haushi reservoir between 2016 and 2017 delivered ultimate recovery of more than 80 million bbl through imaging of truncations beneath Nahr Umr sealing shales. These low-unit-technical-cost developments are under accelerated development programs with follow-up potential. In two of the case studies, the authors credited strongly integrated exploration, development planning, well and facility engineering, and operations teams collaborating from early in the project with allowing maximum value to be realized. In addition to the case-study plays, success was also achieved in exploring core and increasingly creamed plays (this term refers to a situation in which exploration has “creamed off ” the best prospects first, leaving more-challenging prospects), in which rejuvenation using new 3D seismic resulted in several discoveries and followup opportunities. Improved seismic quality in a mature basin continues to add value through enabling new discoveries from old ideas. Thus, the strategy of maintaining investment in seismic during a downturn—with a focus on stratigraphic and subtle traps—and achieving cash flow from early production has proved to be a solid basis for future success.