Scribd
Upload
59 views13 pages

Rig Metrics and D&C Unit Cost For Brazil

Uploaded by

Donald Straub
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
59 views13 pages

Rig Metrics and D&C Unit Cost For Brazil

Uploaded by

Donald Straub
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 13

GLOBAL RIG

METRICS & BRAZIL


D&C UNIT COSTS
Donald Straub. P.Eng.
Offshore Drilling & Completions Consulting Advisor

1
Summary of Global MODU Day-Rates & Utilization
• MODU (drillship, semi-sub, jack-up, & tender) worldwide utilization is currently 67%.
• Floating (drillship & semi-sub) rig worldwide utilization is currently 50%.
• MODU utilization in Latin America is 77%.
• Semisubmersible utilization in Latin America is 85%.
• Drillship utilization in Latin America is 100%.
• Day-rates for non-harsh environment Vintage to 6th Generation Semisubmersible is
120K – 165K USD/day.
• Day-rates for non-harsh environment Vintage Drillships is 115K USD/day.
• Latin America floating rig market is tight, but day-rates are considerably cheaper
compared to 5 years ago.
2
MODU Utilization, Global
Locations & Day-Rates – May, 2021

3
Bassoe Analytics Floater Rigs Utilization & Day
Rates – May 2021

4
Summary of Offshore D&C Unit Costs (USD/foot)
• 2012 Offshore Brazilian (predominantly Deep-water) Unit Drilling & Completion
costs were 4,700 USD/foot.
• 2012 US GOM (Shelf & Deep-water) Unit Drilling & Completion costs were 2,450
USD/foot.
• Estimated/forecasted 2020 Offshore Brazilian (predominantly Deep-water) Unit
Drilling & Completion costs were 3,400 USD/foot for +/- 225 wells.
• Estimated/forecasted 2020 US GOM (Shelf & Deep-water) Unit Drilling &
Completion costs were 2,800 USD/foot for +/- 470 wells.
• Estimated/forecasted 2020 Trinidad & Tobago (probably Deep-water only) Unit
Drilling & Completion costs were 4,200 USD/foot for +/- 4 wells.
5
Drilling & Completion Unit Costs (USD/ft) Trends
for Offshore Brazil & US GOM

Note: data beyond 2016 was forecasted by Spears & Associates


Drilling & Completion Unit Costs (USD/ft) Trends
for Offshore Trinidad & Tobogo (Next Door to Guyana)

• 1 Semisubmersible
• 7 Drillships
• 2 Jackup (Ready Stacked) 7
Note: data beyond 2016 was forecasted by Spears & Associates
Summary of Offshore Frade Drilling &
Completions Unit Cost (USD/foot)
• As a consequence of process improvements in Frade, the D&C unit costs were reduce
by 50% from +/- 8,000 USD/ft in 2009 to +/- 4,000 USD/ft in 2010/2011.
• The Spread-Rate for Frade was +/- 1M USD/day.
• The rig day-rate for the Sedco-706 used on Frade was 361K USD/day or 34.4% of the
Spread-Rate.
• The Semisubmersible utilization rate in Latin America is still fairly tight @ 80%-85%.
• Assuming a similar rig can be picked up today for +/- 160K USD (see slide 3 or 4) given
today’s market environment + assuming the rig cost is still +/- 35% of the spread-rate, it
would appear it could be possible to drill a similar well for (160K USD/0.35) 465K
USD/day. This represents a 50% reduction in the spread-rate from a few years ago.
• This would imply a well cost of 23.9M – 31.4M USD compared to 51.4M – 67.1M USD 8
Drilling & Completion Unit Costs (USD/ft) Trends
for All (LHS Below) of Offshore Brazil Vs Chevron (Frade Field)
Chevron (Actual Data)

Chevron Frade Average Unit Costs


Year Days/well Unit Cost (USD/ft) Spread-Rate (USD/day)
2009 95.9 7,907 1,083,000
2010 67.6 3,654 1,027,000
2011 51.4 4,286 1,050,000

Spread Rate = Rig Day-Rate + Avg. Day-Rate for Services/Materials/Logistics


Sedco-706 Rig Day-Rate = 361K USD/day
Services/Material/Logistics = 689K USD/day
Rig Cost as a Percentage of Spread-Rate = 34.4%
Reduced Unit Cost by +/-50% from 2009 to 2010/2011 through process
9
improvements.

Note: data beyond 2016 was forecasted by Spears & Associates


Frade Drilling & Completions Lessons Learned from
Process Improvements from 2009 to 2010/2011 (1/3)
• Petrobras originally deemed the Frade Field as having marginal potential.
• Frade was FIDed based upon a target production rate of 70,000 bopd.
• Frade reservoir was characterized by significant faulting & reservoir sand discontinuities.
• As a consequence, early completions could not produce commercial quantities of oil.
• Game Changers/Lessons Learned (1/2):
• 6 ½” Sinusodial pilot holes were drilled to identify were the sand were located
beyond faults.
• Pilot hole would then be plugged back and landed geometrically with 8 ½” hole to
connect the sand and complete the well.
• Batch drilling (drilling same hole size section in multiple wells) was adopted.
• The Sedco-706 was a 5th Generation rig capable of Dynamic Positioning (DP). 10
Frade Drilling & Completions Lessons Learned from
Process Improvements from 2009 to 2010/2011 (2/3)
• Game Changers/Lessons Learned (2/2):
• Rig moves during batch drilling were conducted with the Riser & BOP suspended a
few meters above the mudline and reconnected to the next well saving
considerable time by not having to trip the BOP to surface in 4,000 feet of water.
• A Multi-Service Vessel (MSV) was used to install Horizontal Christmas Tree on wells
while the rig was batch drilling another well in parallel.
• As a consequence of these process improvements, the Unit D&C Cost (USD/ft) was
reduced by 50% from 7,900 USD/foot in 2009 to +/- 4,000 USD/foot in 2010/2011.
• In addition, the Project was able to achieve it’s 70,000 bopd FID target.
• Frade was selling 100M USD of crude from it’s FPSO every 2 weeks into the spot market.
Much of the crude ended up in Santiago, Chili. 11
Frade Drilling & Completions Lessons Learned from
Process Improvements from 2009 to 2010/2011 (3/3)
• Shortly after this achievement, Frade experienced an underground blowout in 4,000’ of
water allowing 3,400 barrels of oil to reach the surface of the ocean.
• The incident review revealed the underground blowout resulted from:
• 13 3/8” intermediate casing being set-shallow and above a fault that travelled back
to the mudline.
• A water injector well 1 km away was only shut-in 1 day before the incident.
• While drilling 12 ¼” hole the well encountered a kick resulting in fracturing the shoe
back to the fault.
• After several weeks, the well was successfully P&A.
• Lessons Learned: Set 9 5/8” casing first (higher shoe strength) before drilling any 6 ½”
pilot holes. 12
Thank You

13

You might also like