UK Group Issues Output Optimisation Guide
Upstream industry group Oil & Gas UK has published a guide for its members on optimising output from brownfield developments, it said May 13.
All but two of the final investment decisions planned this year for the UK and Norwegian continental shelves have been delayed as oil and gas prices and demand have crashed. Companies however are not all working as hard as they could to maximise the economic recovery from the continental shelf, the guidelines say.
The guide says that around 6.5mn barrels of oil equivalent (boe) production were added in 2017 by optimisation activities, at an average cost of £10.69 (now $13.08)/boe. Brent crude ended that year at about $60/barrel, so a few hundred million pounds of extra revenue were received.
In addition, a focus on day-to-day optimisation of wells, process plant and water injection can effectively deliver “free barrels” that, in many cases, are able to be added almost instantaneously. But, "despite the value to be gained, many organisations face challenges in identifying, approving and executing production optimisation activities," the document says.
Among the recommendations is that companies should reward incremental output: responsibility for production optimisation should sit at a high level within the organisation, preferably within the senior management team, and production optimisation should be viewed on a par with traditional functions such as maintenance.
OGUK’s operations director Katy Heidenreich said that looking after UK assets is crucial to the long-term future of the basin, especially at a time when a significant number of North Sea projects are put on hold. These guidelines help companies develop, maintain and operate existing assets, finding the most efficient way to recover reserves from existing sites.
"This is the latest initiative from the UK offshore industry to improve production efficiency. Alongside other programmes such as the competitive well delivery initiative, it will ensure we can continue to meet as much of the UK’s oil and gas needs from domestic resources while also putting our sector in the best position to support the transition to net zero,” she said.
Upstream regulator Oil & Gas Authority, whose remit is to maximise the economic recovery of the UKCS oil and gas reserves, said there was "considerable additional value held in brownfield resources. Oil and gas will remain an important part of our energy mix for the foreseeable future as we transition to net zero, so increasing recovery and maturing these resources should remain a priority, despite the associated challenges."