The Role of Risk Management in Development and Application of New Technology

Abstract

Abstract Exploration and development drilling continues to move toward deeper targets both in terms of water depth and reservoir depth. It is characterized by significant costs, technical challenges and high consequences of failure. Significant costs can easily turn a discovery into a marginal field, making it unattractive to pursue. Technology plays an important role in reducing drilling time and well cost. Application of technology (proven technology applied to new areas and new technology) has considerable potential, but also has high risk exposure. A risk management process becomes essential for successful drilling programs. Key components of risk management as it relates to drilling applications include identification and management of well control risks, economic risks associated with non-productive time, unplanned events and equipment reliability, and qualification of technology prior to application. In most situations, capital expenditure and operational expenditure are used to determine which path a project should take. A third component, expenditure associated with risk, is not often considered and yet can drastically alter the overall expenditure of a selection to the point of making it a bad choice. Case studies are presented in this paper of application of risk management to several different areas including active heave drawworks, dry tree completions and subsea completions. In all cases the application of risk management reduced risks in terms of both economics and safety. It is imperative to manage risk and uncertainty in the application and development of new technology in order to keep the new frontiers of drilling economically viable.