With the sanction of the mega project Culzean, Maersk Oil has opened a new toolbox with substantial future potential and opportunities.
The UK North Sea has changed dramatically in the fifty years since hydrocarbons were first discovered there. Production peaked at the turn of the century and large fields of so-called ‘easy’ oil and gas are depleting, replaced by smaller, more marginal discoveries, often dependent on existing infrastructure to be considered economic.
As a result, larger discoveries tend to be more technically challenging with high pressure, high temperature (HPHT) accumulations being one of the main areas of prospectivity remaining. Handling the extreme pressures and temperatures in HPHT development safely calls for highly specialised equipment. This means far greater cost than for a normal pressure, normal temperature (NPNT) field. Though Maersk Oil’s knowledge of the conditions and their effects on drilling and production has greatly increased, developing the skills needed to make these fields a success is important should the company wish to continue to explore and develop HPHT reservoirs. But nurturing such skill sets is also vital for the future of the North Sea more widely.
The Culzean field is Maersk Oil’s first operated- HPHT development and the largest discovery in the UK North Sea for a decade.
The discovery is estimated to contain between 250 and 300 million barrels of oil equivalent (boe). At its peak, and from its three new, bridge-linked platforms, it is expected to produce between 60,000 and 90,000 barrels of oil equivalent per day and will provide the UK with 5% of its gas demand.
The project was sanctioned in August by the UK Oil & Gas Authority, but history, and the experience of others, such as Total (Elgin-Franklin) and Shell (Shearwater), tell that developing and producing from Culzean will be a complex undertaking.
Developing a HPHT reservoir brings many unique challenges as Jeppe Nygaard, Culzean Subsurface Manager explains: “In a normal field, we drill dedicated water injector wells or rely on the aquifer to maintain pressure in the reservoir as we extract hydrocarbons. In HPHT there is no water injection and aquifer support is limited, at best.”
“As you produce, the pressure drops and the pore space of the rock, where the hydrocarbons are located, decreases. This creates compaction which has an effect similar to squeezing a saturated sponge. It causes the seabed to subside and the rock column to compress, potentially deforming the wells and in some cases shutting them down. The consequence of this is lost revenue, so it’s important to carry out analysis and design wells that are able to withstand this. Placing wells in the optimum location and selecting the right well materials can mitigate against the effects of compaction, however, it is an inevitable part of HPHT production so we need to manage the risk. This is a key priority on Culzean.”
A lot of specialist equipment is required to drill HPHT wells, especially for the completion. “With fewer than 100 HPHT wells producing around the world, as compared to thousands of NPNT wells in the UKCS as alone, it can be considered a niche market,” explains Andy Lough, Culzean Well Project Manager. “This makes the equipment necessary to complete these complex wells quite scarce as there isn’t a large market for it. This raises costs as equipment needs to be engineered to order; there isn’t an off the shelf solution.
“Upfront costs are also increased as you need to drill HPHT wells prior to the installation of the topsides. These wells can take up to a year to drill so time is of the essence and this makes economics a huge driver towards the decision to develop a HPHT reservoir.”
The official Culzean signing ceremony with co-venturer and OGA representatives, and the UK Chancellor of the Exchequer.
Culzean is one of two North Sea mega projects Maersk Oil has brought to sanction in 2015.
The wells required to access the Culzean reservoir have a vertical depth of more than 15,000 feet.
The Culzean field will be developed using three bridge-linked platforms.
HPHT wells take significantly longer to drill than those in conventional reservoirs because they’re deeper and have more complex well construction to carefully manage the high pressures and temperatures.
The challenge and complexity of HPHT development can squeeze the economics of many projects. However, carefully managing risk and staying cost-efficient
“HPHT fields are challenging but if developed safely and correctly they can be profitable,” says Martin Urquhart, Culzean Project Director. “We see this with other HPHT developments that have progressed successfully to production. So it is absolutely something that can be done, it just requires a lot of focus and efficient planning. If we want to prolong the life of the UKCS we have to be innovative and make more of these fields economic.”
“For Culzean, we’ve found that front end loading has been essential to both plan effectively and keep a handle on cost. For instance, we ordered 18 long lead items upfront to make sure they’re built to specific requirements and keep us disciplined on schedule. Much of the equipment installed on the Culzean wellhead platform is substantially larger than normal. A NPNT valve can be quite small. Compare this to a HPHT valve, which is often the size of a room and the difference is striking.”
Andy adds: “The HPHT community is very reliant upon one another. If there were challenges with the drilling of any HPHT well in the North Sea a forum exists in which to share the learnings and it’s important to carry those learnings into Culzean.”
The high pressures and temperatures involved make the development inherently risky, and whilst these risks first emerge at the drilling stage, they are ever present throughout: “We’re working to build a truly 21st century installation, which keeps the safety of personnel at its core.
This is the main factor behind the layout of the topsides,” explains Martin. “We’ve managed to ensure that human intervention on the Wellhead platform is kept to a minimum by keeping essential controls on a separate topside. This minimises the risk of human error and keeps our people safe. Ultimately, we want Culzean to be Incident-Free in construction, installation and operation.”
HPHT in Maersk Group
HPHT fields will continue to be an important part of the Maersk Oil North Sea portfolio. Maersk Oil UK picked up six licences in the 28th Licensing Round, three of which include HPHT accumulations, to add to other HPHT prospects already in the portfolio. As a mixture of operated and non-operated prospects, our skillset will continue to develop whilst we share our learnings with our co-venturers. HPHT developments aren’t just important to Maersk Oil.
Maersk Drilling is also collaborating with BP to produce deepwater drilling rigs capable of safely handling temperatures up to 350 degrees Fahrenheit and pressures of 20,000 psi. This sophisticated technology is pushing the limits of hydrocarbon exploration and is encouraging the industry to work together.
Martin concludes: “HPHT developments carry more risk than NPNT fields: they require bespoke equipment, more time and therefore more money. But the prize is significant. Culzean is expected to come on stream in 2019 and will produce, it is expected, for at least 13 years. Add to that the prize for the industry as a whole, in developing the skills to safely and economically develop HPHT wells: less mature basins than the North Sea, such as Mexico and the Far East offer significant HPHT opportunities. We simply need to apply the knowledge we’re accumulating.”