Optimising Oil and Gas Production Production in the Upstream Industry

Oil & Gas IQ

Ageing reserves, coupled with a global demand for oil that is not yet ceasing, mean the ability of the upstream oil industry to optimise oil and gas production from existing wells is vital.

In its monthly oil report for August 2010, the Organisation of Petroleum Exporting Countries (OPEC) raised its global oil demand focus, based on the strength of economic recovery seen within non-Organisation for Economic Cooperation and Development (OCED) nations.

The outlook was boosted by some 140,000 barrels a day (b/d) throughout the rest of 2010 and into 2011, with oil demand in the OECD increasing in the second quarter of 2010 for the first time since 2007.

"World oil demand in the second quarter grew by 1.3 million b/d, leading to stronger growth exceeding 1.0 million b/d in each of the following two quarters of the year," the OPEC report said.

"Given the stabilised oil demand in the United States, world oil demand growth forecast is revised up by 0.1 million b/d to show growth of 1.05 million b/d or 1.2 percent."

The key to the upstream industry meeting this demand in the face of dwindling oil reserves, many of which are increasingly complex to extract, is technology, according to Mark Albers, senior vice president at ExxonMobil.

This is particularly important in North Africa, where, despite promising oil reserves, technology often falls behind that of the rest of the world.

Advanced Drilling Techniques

Earlier this year, ExxonMobil saw success after using advanced horizontal drilling techniques to optimise production of the Santa Yuez unit in the United States.

The company drilled the world's longest extended reach well from an offshore platform in southern California, measuring six miles horizontally at 7,000 feet below sea level. The well was drilled from the Heritage platform, which is one of three serving the Hondo, Pescado and Sacate fields.

By using the horizontal drilling techniques, upstream industry leader ExxonMobil will be able to produce an extra 5.8 million barrels of oil equivalent from the well, which is enough to serve more than 144,000 United States citizens.

Fast-drill technology was used to create the well extension, which can improve drilling rates by 80 percent, providing the upstream oil industry with faster production optimisation.

Kok-Yew See, ExxonMobil's United States production manager, said: "ExxonMobil is applying its advanced drilling technologies to produce more domestic supplies of oil to meet America's growing energy needs."

"These new tools and lessons learned from our recent work off Russia's Sakhalin Island have been key in helping us reach these resources safely and efficiently."

ExxonMobil isn't the only company in the upstream oil industry looking to technology to increase production. The Kuwait National Petroleum Company recently signed a memorandum of understanding with the Japan Oil, Gas and Metals National Corporation to use technology to "enhance the ultimate oil recovery factor in oil fields in Kuwait," which is likely to include enhanced oil recovery techniques.

Subsea Well Intervention for the Upstream Oil Industry

Oil field services company Expro is in the process of realising its AX-S subsea well intervention system technology for use by the upstream oil industry. Operated remotely and deployed from a boat, the technology will allow the upstream oil industry to access wells at any depth, minimising the risks involved with interventions.

The company recently signed a $100 million (£65 million), multi-year contract with TS Marine Asia Pacific to provide the vessels to carry the AX-S technology, which is 110ft high and weighs in at 220 tonnes.

"There are approximately 4,000 oil and gas producing subsea wells across the globe and this number is ever increasing. With many now over a decade old, these wells require servicing to allow for maximum oil and gas recovery," Expro explained.

In September, Expro is due to commence well testing at nine sites in Southwest Algeria to determine commercial viability by measuring pressure, flow rates and obtaining representative fuel samples.

Commenting on the awarding of the contract, Nigel Meany, director of Expro's Middle East and North Africa (MENA) region, said: "This is a fantastic win for the Expro MENA team, with our work in Algeria becoming a significant part of our business."