Cutting costs at the cutting edge

Daniel More, Chief Technology Officer, Expro considers the benefits of new technologies when it comes to operating in a low oil price environment.

In current market conditions it’s easy to focus on the short term and cut costs to the detriment of longer term growth. Budget cuts, especially in the exploration and appraisal of new reservoirs, will eventually reverse the oversupply in the market currently helping to drive the low oil price. However, there is a growing voice that says this is also delaying an upturn, and that we must invest in new technologies to address this issue.

This includes the drive towards technologies that not only reduce time to drill and complete wells, but also minimise costs – however, the right incentives must be in place to develop these. The downturn places increased pricing pressure on the industry, but by simply squeezing the supply chain, it places R&D expenditure under added stress.

Although cost efficiencies are paramount, it’s easy to temporarily focus on technologies that purely reduce cost. Therefore, any investment must give a clear return and work towards developing industry solutions for the long term. The industry must work to move away from the boom and bust cycles of the past, and any cost-efficiency drives must be sustainable for this to truly happen - we cannot simply return to high cost-base conditions when the market picks up.

An area that requires technology development is in the production optimisation or enhancement space. Expro is playing its part in this by developing technologies such as sonar-based flow meters, which offer operators the opportunity to measure production rates on a well-by-well basis. Clamp-on and non-intrusive, they can be installed quickly and without production shutdown. This offers cost effective individual well surveillance; an important aspect when managing existing well stock, maximising production and targeting wells for intervention in a timely manner.

In addition, faster wireless data communication systems from downhole to desk are being developed allowing instant data interpretation and online decision-making. This coupled with standardised reporting software automatically linked to data acquisition systems, speeds up the process from data capture to action, thus creating more value for operators.

There is a hive of development activity and innovation across the service sector to address issues around cost, but this should be seen as only half the prize.

The real incentive should be to accelerate the upturn and increase activity levels in exploration and appraisal. Investing in technologies that facilitate this should be encouraged and promoted. The sector must be ready for an increase in activity by having these technologies developed, tested and in place to allow us to go deeper or to higher pressures and temperatures. Developments that are integral to allowing frontier projects to be brought on-stream cost-effectively and therefore sanctioned earlier should also be included in the technology road map.

Over the years, Expro has been working with ball valve technology, and is now working on improving the functionality and integrity of downhole products. The company is also developing wireless activated DST systems for ultra-deepwater applications. These systems are aimed at significantly reducing the rig up and operating times of conventional hydraulic activated systems.

In addition, the company is working to qualify conventional drill stem testing systems for ultra-high temperature applications (+/- 450°F). New lightweight intervention systems are also being worked on for cost effective deployment and project sanction. These systems are based on the aforementioned ball valve technology, thus saving size and weight over conventional gate valves. Cost-effective intervention from vessels of opportunity is essential if maximising economic recovery is to be achieved in the short to medium term.

‘Interventionless wells’ are the ultimate longer term goal and perhaps, not as far in the future as we currently perceive. The key in this regard is balancing the short term goals of cost reduction and production optimisation, with longer term technological development that will accelerate the upturn and truly maximise the economic recovery.

Operators and services companies are well placed to work together to achieve this.


Adapted by David Bizley

Published on 19/08/2015


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