Despite a modest increase in offshore E&P activity, many development prospects remain largely unattractive to the major industry players. Stranded hydrocarbon discoveries, aptly called “marginal fields,” are being largely ignored by bigger operators due simply to some discoveries’ limited scope, such as the size of the reserve, making the field economically infeasible. Decision-making for the development of marginal fields requires a thorough investigation of the economics of development costs and hydrocarbon recovery rates as well as an evaluation of the technical and geological conditions and risks. Other concerns, like limited or nonexistent pipeline infrastructure to get products to market, further complicate a hard-to-sell value proposition.

With operators routinely seeking efficiency gains and cost improvements to maximize their use of capex, it isn’t worth the economic investment to develop a field if the reservoir is small and/or the production potential is low. It is often the case that fields with marginal economics and low reserves will require some sort of unique solution, a novel concept that will remove development barriers in that scenario. Unfortunately, this reduces the attractiveness of marginal fields to large operators because of limited fieldwide applicability during a well development campaign. Yet that very same field could be, for a smaller and more agile operator, a chance to quickly implement an effective solution on a project with three or four producing wells. Such a solution could yield much greater benefits when produced on a shorter life cycle than typical larger developments, which stretch over significant time frames.

Case study

DeNovo Energy Ltd. is a new independent upstream company operating Block 1(a) in the Gulf of Paria offshore the west coast of Trinidad. The company set out to drill a three-well development campaign in the stranded Iguana Field using a jackup rig in shallow-water depths of approximately 27 m (88 ft). The field is undergoing fast-tracked development and is expected to yield 2 MMcm/ d (80 MMcf/d) of gas that will be transported to the Port Lisas Industrial Estate for processing via a 45-km (28-mile) offshore and onshore pipeline.

The history of the Iguana Field dates back to the early 1980s, but the field remained undeveloped despite changing operators several times. DeNovo acquired the block in 2016 and benefited from a lean operating structure and in-depth knowledge of the region. Additionally, DeNovo’s size meant the economic impact to the company would be strong enough to merit an investment, even with lower production levels.

Aquaterra Energy’s Sea Swift conductor-supported platform can be transported on a standard supply vessel and installed using  conventional drilling and lifting techniques from a drilling rig. (Source: Aquaterra Energy)

 

National Oilwell Varco (NOV) worked with Aquaterra Energy, a provider of global offshore engineering solutions, to deliver an application of its XLC-S connector on an Aquaterra Energydeveloped offshore platform. The Aquaterra Energy concept, called Sea Swift, is a conductor-supported platform ideal for benign, shallow-water applications, such as the Gulf of Paria. In such applications, Sea Swift reduces maintenance and well capital costs by utilizing dry trees and enabling access provision by crew boat or helicopter. The design of the solution facilitates quicker, more cost-effective installation, enabling all activities to be performed by a standard jackup rig without the need for additional installation vessels. This reduces upfront costs while also eliminating the need for traditional platform structures.

The benefits of rig-installable, conductor-supported platforms often outweigh those of traditional platforms and subsea trees for shallow-water development projects. Aquaterra Energy’s Sea Swift concept was the ideal solution for DeNovo’s challenge of developing the Iguana Field economically. It helped DeNovo reduce necessary capex while also simplifying and accelerating the path to first gas.

The unit, which included local power generation, manifolds and a control system, was completed endto- end in 10 months and was the first of its kind to be installed in the country. The cost savings achieved were magnified by the use of a smaller fabrication yard that worked quickly and effectively. Furthermore, using the jackup for installation made it easier to manage the project and reduced any risks involved with transportation and installation.

NOV provided Aquaterra Energy with the XLC-S connector for the platform, which is a second-generation integral connector with the pin and box threads machined directly into the wall. In addition to having an optimized connector geometry, the XLC-S also has a true flush inside diameter and outside diameter.

The connector is ideal for conductor-supported platforms due to the enhanced structural strength and improved fatigue performance, while the external metalto-metal seawater exclusion seal ensures that corrosion in the threads will not be an issue. XLC-S connectors typically make up via three low-torque, spin-up turns until the thread surfaces engage. The connectors can be made up with either power tongs or manual tongs at comparatively low makeup torque rates of 30,000 ft-lb to 60,000 ft-lb, depending on size. Comprehensive physical testing of XLC-S connectors and a significant amount of field data have validated the connectors’ performance, and they take up no more annular space than a pipe. Additionally, the design of the connector eliminates large diameter forgings and welding costs, which on this project was a critical driver of both reducing overall costs and helping Aquaterra to deliver the platform to DeNovo in such a short time frame.

Drilling has been completed for all the Iguana wells using the Well Services Rig 110, and first gas is expected by the end of the year.

The design of the Sea Swift (in yellow above the water line) reduces maintenance and well capital costs by utilizing dry trees and enabling access provision by crew boat or helicopter. (Source: Aquaterra Energy)

Friend or foe?

For the smaller, more agile E&P companies, marginal fields should not be ruled out, despite some of the inherent risks such fields pose. The main challenges come from developing an innovative solution that will make the field profitable and implementing that solution on the actual project. As the price of fabricated steel has decreased, so have the cost differences between a conventional jacket and alternative options, such as a Sea Swift platform. Overall cost savings primarily come from using smaller and more agile fabrication yards and a jackup rig for installation, as demonstrated by DeNovo in this application. This also helps to ensure a simpler, more cost-effective project management process and reduces risk associated with the development itself.

These factors in today’s cost-constrained climate mean that a conductor-supported offshore platform solution is becoming a more financially viable option for fast and effective production in marginal shallow-water developments. As a working example, due to the reduced time to first gas and the cost benefits of using a jackup rig for installation, a Sea Swift platform installation can be up to 45% less expensive than a conventional jacket platform.

For DeNovo, the choice was clear. The modularity of Aquaterra Energy’s conductor-supported platform allowed DeNovo to bring together the advantages of a platform with the rig-run benefits of a subsea development, while NOV’s connector technologies provided improved structural integrity and fatigue performance as well as assisted Aquaterra Energy in delivering the platform quickly. This type of combined, integrated solution, showcased via DeNovo, is ideal for the economics of marginal field developments.