International Journal of Materials, Mechanics and Manufacturing, Vol. 4, No.

1, February 2016

Reactivation of Mature Oilfields: A Multifaceted

Production Management
Eduardo Oliveira Teles, Ana Paula Maia Tanajura, Francisco Gaudêncio Mendonça Freires, and
Ednildo Andrade Torres

 produced 40% of recoverable oil volume, based on initial

Abstract—The pressure of an increased global energy studies [4]. Mature fields are those in advanced stage of
demand and the increase of oil prices stimulate the reactivation production life cycle and, mostly, require some recovery
of oil fields that in the past were considered non-profitable. The technique.
reactivation of these fields, also known as mature oil fields,
carries with it uncertainties regarding production and
After the recent opportunities of investments to explore the
management. For more than one decade, Brazilian National area known as Pre-Salt in Brazil, small on-shore fields with
Agency of Petroleum, Natural Gas and Bio-Fuels (ANP) auction low profit is not interesting anymore for large enterprises and
mature oil and gas fields that have been returned by Petrobras, public/private consortia. However, there is still difficulty in
the Brazilian oil company, over the years. This business is not inserting small companies in this business because the
attractive for big oil companies because the recent opportunity existing rules or the lack of them, and also the reduced
to explore pre-salt in Brazil. However, it has rules and aspects
that difficult the insertion of small and medium enterprises number of auctions in recent years by the ANP, Brazilian
(SME). This work aims to present how to reactivate mature regulatory agency.
oilfields through multifaceted aspects of production This paper aims to present how the reactivation of wells in
management. The paper focuses on the methodology of creating a mature field can be done. We propose a methodology with a
facets in the oilfield reactivation process. It comprises the all multifaceted analysis that includes the whole reactivation
cycle: bidding, production, and deactivation process of the
process: request for proposals, concession of exploration,
producing area. From the facet definition and bibliometric
analyzes it is possible to define profiles for managers and start-up, production stage and decommissioning. We start
managing aspects for each subarea of production process. We with the bibliometric analyzes that defines 5 important facets
intend with this proposal to help develop new mechanisms related to oil and gas exploration (environments, contractual,
facilitating the insertion of SME in the activities of oil economic, technical, and decision-making). The paper
exploration and production. contribution is the business model that helps the insertion of
SMC in oil and gas business. It is an ongoing research in
Index Terms—Mature fields, multifaceted management,
Federal University of Bahia in Brazil that includes the
small and medium companies.
methodology and a hybrid algorithm for decision making in
reactivation process, issue that will be detailed in a second
I. INTRODUCTION paper.
In recent years, the production of oil and gas in mature
fields by companies of different sizes has been realized. There
II. GENERAL VIEW — OIL AND GAS LIFE CYCLE
is a tendency to expand the participation of small companies
in this market with the reduction in participation of big The supply chain of oil, in general, can be subdivided into
companies as Petrobras, the national oil company in Brazil. the following stages: production, distribution, refining and
The Brazilian regulatory model tends to be adjusted in order retailing [5]. This work takes as reference the life cycle of a
to understand and stimulate this type of operation. It mature on-shore oilfield. The life cycle of exploration and
encourage generation of employment and incomes in the production projects has been estimated between 20 and 30
regions that are located in these on-shore oilfields. years and has three stages: exploration, development and
There many definitions for mature oil fields [1]-[3]. In this production [6]. There are different activities in each stage and
paper, we adopt the definition from Câmara: a mature field professionals with different specialties.
In the exploration stage, the goal is the identification of oil
Manuscript received February 11, 2015; revised June 21, 2015. or gas reserves. To accomplish this, geological studies are
Eduardo Oliveira Teles is with the Program of Industrial Engineer, conducted. After confirming the existence of hydrocarbons,
Federal University of Bahia, Salvador, Bahia, Brazil. He is also with the the next step begins: the field development. In the
Department of Informatics, Federal Institute of Education, Science and
Technology of Bahia — Camaçari, Bahia, Brazil (e-mail:
development stage, the production is planned and all
[email protected]). necessary resources are evaluated. Finally, the production
Ana Paula Maia Tanajura is with the Program of Industrial Engineer, extraction occurs in order to ensure the highest profit. This
Federal University of Bahia, Salvador, Bahia, Brazil. She is also with the
step also includes the abandonment of the field.
Senai Cimatec, Salvador, Bahia, Brazil (e-mail:
[email protected]). Jean-Pierre Favennec and Nadine Bret-Rouzart summarize
Francisco Gaudêncio Mendonça Freires and Ednildo Andrade Torres are the stages of oil and gas new projects [7]: Preliminary studies
with the Program of Industrial Engineer, Federal University of Bahia, (initial analyzes of the discovered reserve, with advances in
Salvador, Bahia, Brazil (e-mail: [email protected],
[email protected]). exploratory activities); Conceptual Studie (definition of the

DOI: 10.7763/IJMMM.2016.V4.221 36
 International Journal of Materials, Mechanics and Manufacturing, Vol. 4, No. 1, February 2016

architecture to the field development, a comparison of there was a growing interest in exploring these areas by SMEs.
technical variables and investment costs); Preliminary design One of the steps of the seventh round of ANP bidding
(it contains information of all operations and defines the occurred only at mature fields whose profile production
decision regarding the investment); Basic engineering history was not interesting for big players. The bid success
(selection of service providing companies for construction was 94%, which reflects a true niche market with good
and assembly); Engineering, supply, procurement and potential [10], [11].
construction (conclusion of the plant construction and final In the scenario of mature fields — low production, high
check of the designed and installed items according to the operational costs and low profit for big players — how it
operational requirements of the project); Production startup could be a good investment option for SME? After exhausting
(the facilities are approved and ready for use); Operation (The natural energy reservoirs, various recovery techniques can be
beginning of the production cycle). applied to increase the productive time of life. Moreover, the
The oil cycle in Brazil began in the late nineteenth century, decision to drop and return of a field varies according to the
when came the first searches for this ore in the Brazilian methods and technologies used. Additionally, production
underground. The first oil field - economically feasible — systems already exist in the reactivation of mature fields. It is
was discovered in 1939, in Lobato municipality, mediations the responsibility of the manager to define and manage the
of the Reconcavo Baiano, which was removed oil of good revitalization strategy adopted. It follows information about
quality and suitable marketing. bibliometric study.
The oil has a great relevance to our lives, due to be used as
fuel, as well as being added in the manufacture of a multitude
of products. Until recently, the Brazil did not have enough oil IV. BIBLIOMETRIC STUDY
production to the domestic supply, thus was dependent on The bibliometric study uses terms and keywords, authors
imported resource, especially the Middle East, but the country and indexed publications to generate a structured knowledge
as of 2007 reached self-sufficiency. Currently, the production in the field of study. One way to structure the bibliometric
exceeds 2 million barrels. study is by building a tree of keywords. This technique
For the petroleum products we need to pass it through divides the initial research on different facets, allowing a
several stages of processing. After being extracted from dual-direction both in terms of coverage of the topic, as the
underground, it is transported to refineries, which make the depth of each area/facet [12]. Bibliometric study subsidized
processing of raw ore into fuel, raw materials and the construction of the model presented in this article.
by-products.
The authors do not explicitly consider the activity of
abandonment. But, there are costs associated to this activity
that should be considered in the end of the production life
cycle. In the sequence, we describe the mature fields in Brazil,
fields in an advanced stage of operation.

III. MATURE FIELDS IN BRAZIL: A REVIEW

After many years of exploration and production, several
Brazilian onshore oilfields reached a level considered
economically unfeasible for large companies. For these Fig. 1. Bibliometric study. The method used for multifaceted business
companies, the daily production of these fields does not model.
generate enough profit. As a result, many of these fields were
returned to the ANP, the regulatory agency. ANP made some Databases were used to define the relevant terms. The
auctions and tendered those fields. With the call of the collected material more relevant and highest number of
Petroleum Law (9478/97) [8], for example, a reduction of the citations by subject area of modular tree serves as a reference
field held by Petrobras under the projects of these fields come for the theoretical background of the research and to assist
to the conclusion and pass these fields to be returned to the management in view of the quality and quantity of technical
regulatory agency. information available. The following will be presented the
The law 12351 [9], 2010 was another breakthrough in the multifaceted model for production management to reactivate
sector. It defined that the Executive branch is responsible to fields and each area will be discussed (see Fig. 1).
stablish policies and measures to increase the participation of
small and medium companys in the exploration, development
and production of oil and gas activities. This law V. THE FACETS OF MATURE OIL FIELDS MANAGEMENT
demonstrates the trend in Brazilian of bidding blocks The methodology allowed the targeting of research in 5
considered mature and not cost effective. aspects: environments, contractual, economic, technical, and
The first round of bidding of mature field areas occurred in decision-making. In the vertical direction, the modular tree
May 2000. 73 areas were offered, but only 13 were acquired (Table I) allows the scope of the issue in targeting facets. In
because of the various risks regarding the oil production. the horizontal direction, were selected for deepening terms in
After the increased on data availability and lower investment, each subarea.

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 International Journal of Materials, Mechanics and Manufacturing, Vol. 4, No. 1, February 2016

TABLE I: MODULAR TREE strategic planning decides on drilling, it can also be applied by
Inicial Objective SMEs Production management in the field should have a
Propose a hybrid algorithm for integrated decision-making process for the multidisciplinary profile for the integrated management of
reactivation of areas with marginal accumulations of oil and gas. assets. Skills in environmental, contractual, technical and
Facets financial allow minimizing business risks.
Environment
Contractual
Economic
Technical
Decision-making

Environment Monitoring, rehabilitation area, processing effluents,

environmental risks, licensing

Signing bonuses, royalties, concession regime,

Contractual
auction, minimum local content

Opex, Capex, IRR, costs, expenses, sensitivity

Economic
analysis, NPV

Development, production, injection, pumping, Fig. 2. Facets — modular tree.

Technical
collection, well installation, onshore
The last facet, decision making, is the most important
because it gathers all the others. There are decisions during
Decision-tree, Real options, Fuzzy, Utility theory, the entire life cycle of an oil field, from deciding to participate
Decision
business process management – BPM.
in the auction, until the decision of closure. During the
operation phase, the company evaluates the level of
production and decides for continuity of operations. At the
For the reactivation of mature fields is necessary to end of this period, managers, with their multidisciplinary
consider these five facets in each steps of exploration projects. profiles, can assess the feasibility of whether to continue the
Because of part of the infrastructure already exists, only in a activities referring to the contracted period.
few buildings and units renovation will be made. In such cases,
the stage of preliminary design is shorter in duration and the
start of production is faster. VI. CONCLUSION
In the Fig. 2 shows the order of the management of
There is an investment opportunity. Many oilfields
reactivation by facets. It includes the bidding round, company
considered economically marginal were returned to large
obligations and action for production start-up. The first part of
companies. But these fields can be economically viable for
figure shows the phases of exploration and production. In all
small and medium businesses. In addition, Law 12.351
these phases, facets presented in the second part of the figure
initiates the review of public policies on taxation and
are important. The project evaluation covers the detailed
supervision to facilitate the exploitation of mature fields.
study of all the risks (technical and financial) even in areas of
Despite high investments, the risks are getting smaller.
reactivation, where these are relatively low because of the
Reactivation of mature oil wells requires a multifaceted
information available on auctions.
production management.
The company participates in the auction that has initially
This work demonstrated how the facets of management
access to environmental and contractual aspects.
were defined from the bibliometric analysis. Environmental,
Environmental legislation and environmental requirements
contractual, technical and economic aspects, when considered
vary with each state in Brazil. In areas that were already
by specialist managers in each area, support the decisions
producing, new businesses can use previous reports. For
correctly, especially for SMEs.
contractual requirements, a legal, contractual and tax
knowledge is required. The technical and economic factors
ACKNOWLEDGMENT
are the greatest interest. Technical decisions influence
directly the cost of production, the productive life cycle and Authors thank sponsor and financial support of: SENAI –
return on investment. Cimatec and PRPGI – IFBA (Edital Inovação 007/2014).
The economic analysis or risk analysis should consider the
risk of commerciality, when a new field is discovered REFERENCES
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commonly applied to large businesses, where a team of and development history: Spraberry trend field, west Texas and

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 International Journal of Materials, Mechanics and Manufacturing, Vol. 4, No. 1, February 2016

Chincontepec field,‖ presented at the SPE International Petroleum process using the multi-agent approach. Ana Paula is a chemical engineer
Conference and Exhibition on Mexico, Vilahermosa, Mexico, 2002. and holds a master degree in business administration, both from UFBA
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[8] Brazil. Lei 9.478 de 06 de agosto de 1997, 1997. Mechanical Engineering of the Polytechnic School of the Federal University
[9] Brazil. Lei 12.351 de 22 de dezembro de 2010, 2010. of Bahia, UFBA. He also has the postgraduate diploma in industrial
[10] G. M. Braga, ―Bibliometric relations between the front search and engineering program (IEP), Federal University of Bahia, researching when
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[12] J. R. F. Filho, Ensaio Teórico Pesquisa Bibliográfica em Estratégia de Energy and Gas Laboratory (LEN), the Polytechnic
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Hidrocarbonetos, Rio de Janeiro, Interciência, 2010. University Bahia. He was the head of two periods of
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has 30 years of experience in the area of technological
Eduardo Oliveira Teles is a PhD student with the development between Industrial Research Centers and Universities.
Industrial Engineering Program, Federal University of He has more than 10 technology products, and several presentations at
Bahia. He is currently a professor at Federal Institute of national and international conferences. His students won the Technological
Education, Science and Technology of Bahia. Awards Environmental Bahia 2004 and Petrobras Gas-Energy Network
He works with modeling and development of 2004. In 2006 he won the Innovative Researcher Award of the Year awarded
decision support tools for the industry, robotics and by FAPESB. In 2008 he was the president of the Organizing Committee of
virtual learning environments. His research topics are: the V CONEM - National Congress of Mechanical Engineering, held in
1) an algorithm with detailed analysis about oil and gas Salvador from 25 to 28 August 2008. It has or had agreements with national
mature fields and 2) informatics applied to energy and international companies such as penetration Braskem, Monsanto,
efficiency. He has a master degree in computational modeling. Griffin, Carib Metals, Petrobras, Polythene, Petrobahia, Gas Bahia. He is the
coordinator of several R & D projects with financing agencies CNPq,
FINEP, FAPESB, Petrobras / ANP.
Prof. Torres is a member of the Bahia Academy of Sciences, is the deputy
Ana Paula Maia Tanajura is a senior researcher at coordinator of INCT Energy and Environment, based in UFBA. He was the
Senai Innovation Institute for Logistics, a professor at coordinator of Technological Development Area and Entrepreneurship
Senai Cimatec Faculty and a PhD candidate in the UFBA for 6 years, was the CEO of the Energy Institute and the State of
Industrial Engineering Program at the Federal Bahia Environment, had been the coordinator of the Center for Energy and
University of Bahia. Her PhD work deals with the Environment Federal University of Bahia (CIEnAm) for 8 years, coordinated
development of a multi-agent model applied to oil the program graduate and Energy and Environment (PhD) for two periods.
field management, in a case study with Petrobras. In Guided 30 students master more than 10 doctoral students and about 100
2013, Ana Paula was a PhD guest student in Artificial undergraduates, more than 30 students of expertise.
Intelligence team at Norwegian University of Science
and Technology (NTNU). Currently, she also acts as the project leader of a
project with the company PetroRecôncavo, the second largest oil & gas
producer in Bahia, Brazil, to develop a system to support decision making

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