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Ppt enigradassessoffshore3to6-march2014

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Information about Ppt enigradassessoffshore3to6-march2014

Published on February 24, 2014

Author: Etly

Source: slideshare.net

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OilSim Exploration and Production

Schedule Time Activity 08:15-08:30 Candidates’ & Assessors’ arrival 08:30-09:00 Welcoming & Introduction 09:00-10:30 Challenge 3 - Negotiation and Drilling 10:30-10:45 Break 10:45-11:45 Challenge 4 - Depletion Plan 11:45-12:45 Challenge 5 - Facilities Plan 12:45-13:45 Lunch 13:45-15:30 Challenge 6 - Construction 15:30-15:45 Break 15:45-16:30 OilSim team presentation task - preparation 16:30-17:05 OilSim team presentation task 17:05-17:30 Evaluation of OilSim and winning team announced 17:30-18.30 Assessors’ wrap-up

Login  See your login slip

You are an oil & gas company...

Your role     Find partners for your new licences Appraise your block’s potential Develop your blocks in preparation for production Report on team performance

Money and Credibility   You start with $500 million cash Maximize profit  Create highest company value possible, measured by the net value of the oil and gas fields discovered MINUS all costs involved. Correct answers and sensible decisions are awarded with Credibility Points (CPs)  Winning team – Points allocated based on value of licence, best improvement in NPV, credibility points and team report 

Today’s Challenges Partnerships, Explor ation Drilling and Appraisal Upstream Depletion planning Facilities planning Construction

Learning cycle

Today’s Challenges Partnerships, Explor ation Drilling and Appraisal Upstream Depletion planning Facilities planning Construction

Challenge 3 All teams have the same CPs from the licence round  Every team has got one exploration license 

Partnerships HQ is happy with the license awarded. Challenge: Farm-out minimum 20% from your license – and farm-in as much as you can in other good licenses.  Acquire 3D Seismic interpretations for the block you operate, and study the results from the licensing round  Get others to invest 20% or more in your license – you can show/send 3D seismic  

Why partner?   Spread the risk Increase probability of profit

Know your asset       What do you have to offer partners? Where is your block? How deep is the water? How many prospects do you have? Where are they? How many wild-cat drills are needed to explore all?

Block depth

Real 3D seismic  Shows the subsurface structure in a cube.

Drill Layer 3 Eocene Layer 2 Paleocene Layer 1 Cretaceous Prospects are no guarantee of oil or gas

Farm-in

Farm-in Enter the percentage and total amount you have agreed to offer Minimum $100,000 per % Add a message to the seller Press “Send offer”

Farm-in When a team receives a Farm-In offer it appears under Financing. This is where a team can receive finance or money for a % of their own blocks

Farm-in   License OWNER decides whether to ACCEPT or REJECT the offer Partnerships established every time a license owner accepts an offer.

Farm-in All your farm-in offers to other teams are shown under “Investing” on the right-hand side of the homepage . This is where a team offers investments to other teams for a % of their blocks

Partnership Terms Partners pay a proportional share of all future costs Partners receive a proportional share of the net proceeds from oil and gas  The operator team makes all decisions regarding drilling  Operators can farm-out up to 70% of licence, but must keep 30%  

Partnership Choices       What do you need to know about your block? What proposition do you have? What do you need to know about potential partners? Information about their block? Team involvement in choices and offers Overall partnership plan

Partnering Your turn

Water depth Decide where you want to drill  Check water depth in the area you are choosing  Find this at the bottom of the BLOCK page 

Choose Rig  Choose the right rigs for your water depths  Jack-up rigs for shallow waters  Up to 100m  Semi-submersible rigs for middle waters  Up to 600m  Drillships for the deepest waters  Over 600m  Rig cost = drilling days * day rate

Rigs available Limited number of rigs 20 minutes to complete each drill  Queues  Prices can change  

Service providers Up to 9 Star qualityGood: normally costs more  Bad: cheaper, but reliability is low, so you risk extra drilling time and extra costs  

Environmental Impact Assessment

Drill Layer 3 Eocene Layer 2 Paleocene Layer 1 Cretaceous

Selecting drill cells  Can choose a cell on all three layers  Deviate by only one cell per layer, either vertically, horizontally or vertically

Controls and estimated costs Oil spill or Gas Blowout control Estimated cost

Drilling days

Drilling Result    Proven volume (MBOE) counts Test may increase proven volume Remember to tick test boxes!

After testing Proven volumes (MBOE) has increased Possible volumes have reduced

Reinterpret seismic

Value

Discovered prospects

Assumptions

Value calculation 25% of 8 MBOE @ $50 Expected costs if you developed the field (capex) and produced the oil (opex) If total expenses are higher than the sales value, the value of the license is zero

Appraisal  From Probable volume to proven reserves

Drilling – Wildcats & Appraisals Wildcats Drill into every prospect once (Wildcat)  Continue appraisal drilling if possible to increase the proven and reduce the potential  Appraisals

Appraisal drilling

Increasing proven volumes   Appraisal wells - proven reserves increase Range between proven and possible is decreased

Effect on calculation of licence Expected costs if you developed the field (CAPEX) and produced the oil (OPEX) Now total expenses are lower than the sales value and so we have a positive licence value

Challenge 3 decisions    After your first drill into a prospect, reinterpret the seismic Decide how many appraisal wells to drill for each discovery Continue partnerships – value of licences increasing - % offered must ≥ % value in real money (e.g Licence Value now $500m, buying a 10% share would give min. bid of $50m)  Ultimately, you should:  Get a positive net present value,  Or conclude that additional appraisal wells will not result in an improvement in net present value

Exploration drilling Your turn

Apply for more funds    Click on Apply for More Funds Tab. 1 CP for each $100,000 applied for. Answer three questions: Outcome Credibility Points All Correct Full Amount Keep All One Wrong Full Amount Keep Half Two Wrong Half Lose All All Wrong  Cash None Lose All Expensive money if less than 10 credibility points: Apply for cash and be fined $5million for each $20million requested.

Today’s Challenges Partnerships, Explorat ion Drilling and Appraisal Upstream Depletion planning Facilities planning Construction

Challenge 4  Make a well plan for each reservoir in your block, choosing:  Number of production wells  Tubing size  Aiming to choose a plan that maximizes value of block  Increased sales value  Decreased drilling costs

Nodal analysis   Read the maximum well flow rate Most suitable Tube size Most suitable tube Sand production limit Highest well flow rate

Expected production profile

Create well plan  Click on Drilling Rig

Reservation information 1. Click the Reservoir tab 2. Click the magnifying glass for the reservoir

Updated information

Amend well plan

Combined Plan

Improve value-revise well plan       Submit plans with different number of wells and tubing sizes Review Reservoir information after each revised plan Aiming to maximize sales value and minimize drilling costs, whilst increasing Recovery Factor You can amend your well plans until the deadline Credibility points – upto 100 CPs if plans are optimal for all your reservoirs After deadline – Value of Licence will be adjusted based on final Well Plan submitted

Depletion plan Your turn

Today’s Challenges Partnerships, Explor ation Drilling and Appraisal Upstream Depletion planning Facilities planning Construction

Facilities planning Plan the facilities to produce the oil and gas that has been found in the block  Maximize the value of the license block   Maintain sales value  Decrease facilities costs  Reduce risk

Environmental surveys Earthquake survey legend Earthquake survey legend Hurricanes

Finding Production Profile

Combined Production Profile

Facility selection Click on facility List

Choose facility type

Platform parameters

Platform parameters  Connect pipelines to Gas terminal and an Oil terminal  No gas flaring allowed or shipping tankers available

Transport volumes  Estimated no. of barrels can be transported per day Different flowline (riser) and pipeline sizes = Different no. of barrels  Flowline size :  Multiphase fluid to platform (acting as flowline and riser) Pipeline size :  Oil and condensate to storage tanks  Gas to processing plant 

Flow overview

Recap Check environmental conditions of your block Refer to Detailed Production profile for flow rates and capacities required for oil, gas, condensate and water  Check Transport Information button to determine number and size of flowlines, and size of pipelines  Click on Facility Tab and Facilities List  Compare platforms available and select best option  Add capacities, flowline, pipeline and Onshore processing and storage facilities needed  Check block value for revised value  Try alternative plans?  

Facilities plan Your turn

Today’s Challenges Partnerships, Exploration Drilling and Appraisal Upstream Depletion planning Facilities planning Construction

Construction PART A  Plan the construction of facilities required to operate your platform  Submit a financial summary of the plan Maximum capital expenditure 2. Total local content budget 3. Expected time period in which First Oil or Gas to be reached 1. PART B  Execute construction plan  Minimize capital expenses  Amend construction plan as issues occur  Get to FIRST Oil or Gas!

Planning construction PART A Activity Hierarchy Survey – study activity dependencies Vendor report - compare providers/local content Prepare construction plan Use Challenge sheets and prepare Gantt chart Submit Planning Summary

Activity Hierarchy Choose only 1 activity – where a Dotted line connects activities Where a solid arrow connects activities, commencement of an activity is dependent upon the preceding activity(ies) being completed

Vendor report Considerations: Reach First Oil or gas within 11 periods of 180 days – TOTAL 1980 days  Time V. Cost  Local Content  

Construction planning

Total costs

Activity starts and completion period

Planning summary - targets A possible tax credit from the government  For achieving the three objectives of project management: budget, time and quality

Recap      PART A Activity Hierarchy Survey – study activity dependencies Vendor report - compare providers/local content Prepare construction plan Submit Planning Summary

Construction planning Your turn

Construction execution

Activities in 1st period

Activity feedback Delay in starting activity Activity in progress Activity completed

Progress report

Period information

Timeline

Updated hierarchy

First oil and bonuses

Recap PART B Execute Plan - as many activities as possible within each period; provider for each activity  Check Timeline chart to see progress  Reassess/alter providers as issues occur  

Reach First oil or gas Your turn

Team report      Performance of company Effects of partnerships Economic viability of asset Learning experiences from course Important knowledge learning points or skills used

Team scores TEAM 1 2 3 4 5 6 COMPANY VALUE CREDIBILITY POINTS NPV IMPROVEMENT COMPANY REPORT TOTAL POINTS

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