Reducing the Hidden Costs of Subsea Well Completions

Abstract

Subsea completions have made it possible to produce oil in remote locations and from smaller reservoirs. But the cost of maintaining them may shorten their productive lives. “Subsea wells have the same things that go wrong as other wells, but fixing them requires moving in a rig and the cost can often be USD 1 million a day,” said Matthew Law, technical manager of sales and marketing at Expro Ax-s Technology. “Where there is direct access from a production platform, there is generally regular well intervention. As a result, the recoverable reserves are higher.” Major producers such as BP, Chevron, ExxonMobil, Statoil, and Shell are among those seeking to cut the cost of deepwater workovers by 50% or more to allow better maintenance. There is no accepted industry average for how much production can be gained from regular interventions. The consensus is that the potential impact on the thousands of subsea completions represents billions of dollars worth of hydrocarbons. “One of the biggest challenges in (increasing) deepwater recovery rates is the cost of re-entry is so high,” said Peter Sharpe, executive vice president of wells at Shell. Drilling rigs are capable, but it can cost USD 5 million to just diagnose why production is down on a subsea well. Based on offshore workovers generally, the payoff for deepwater work will range from simple fixes that yield significant gains, to difficult cases where the repair cost far exceeds the likely return. Most wells fall somewhere in between. The experience of operators in the relatively shallow waters of the North Sea shows there is a return for investing in regular subsea well maintenance. The cost and technical challenges rise in deep water, where the lower-cost methods used in the North Sea are now being tested. Without significant cost reductions, the cost of repairs that can slow production declines on 10 wells can exceed the cost of a deepwater exploration that might deliver far more in the near term. To reduce cost, the industry is considering a mix of proven technologies and emerging ones. Much of the work is directed toward using construction boats rather than drilling rigs. “Cost is one of the drivers, but we are also looking at keeping these activities off drilling rigs to allow more exploration and development work,” said Colin Buchan, well delivery manager for floating hoist at Shell. “They are complex machines designed to drill wells. They were not designed for well interventions.”