Exploration - The 21st Century Agenda - Oil & Gas UK€¦ · 21st Century Exploration Road Map Survey barriers to increased exploration Well Failure Analysis Frontier Initiatives:

Exploration - The 21st Century Agenda

Chaired By

Oonagh WerngrenOperations Director

Oil & Gas UK

Stimulating Exploration Role of the Regulator

Glen Cayley Senior Advisor

Oil and Gas Authority

Stimulating Exploration

Role of the RegulatorGlen Cayley

OGUK Conference

June 2015

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2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Num

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idtra

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Exploration Wells

Appraisal Wells

Development Wells

Source: DECC

E&A drilling sharp downward trend

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2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

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Exploration Sidetracks

Exploration Wells

Source: DECC

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Appraisal Sidetracks

Appraisal Wells

Source: DECC

Cost related

2005: 300 wells

2014: 165 wells

Hit Rates, Volumes and finding costs

Following the fall in well count the overall success rates (SR) have slipped

In last 5 years although technical SR >50% commercial SR c. 20% i.e. only 40% of wells with hydrocarbons move to firm developments the rest swelling the stranded discovered undeveloped small pools

Exploration volume yield <100mboe in 2014

Finding cost from <$5/Bbl to >15$/Bbl over 10 year period

Exploration Outcomes Deteriorate

Dry Hole Analysis for c. 100 wells in the CNS/OMF 2003-2013

Objectives: Most target the Jurassic 56%, Post BCU 38% <5% ‘Deep tests’

One third drilled because of some sort of “DHI”: AVO, amplitude, gas cloud, “impedance” etc…

Chance of Success 34% CoS 20-30%

But 40% CoS > 31%: over-confidence in the risking assessment?

3 or 2 risk elements = 87% failed; 1 risk element = 13% failed

Multiple risks in a mature well calibrated play = red flag

DHI’s not Alchemy do the basics

Need to improve top seal, fault seal, reservoir prediction use best available (better) seismic

Exploration Outcomes Deteriorate

There are over 200 small discoveries between 3-15 Mboe

1-2 Bboe hit by soaring drilling and development costs and or access to: Internal and external funding,

Infrastructure

An aligned partnership

Suitable Rigs

Vessels

Crews

Critical Data

Good News ! Seismic costs, Rig rates, Vessel rates have fallen sharply. Other capital costs need to follow. A 30 – 40 % fall together with simpler solutions could unlock significant opportunity/value provide up to 15% of UK future production

Hydrocarbon Maturation

Focus on increased exploration

21st Century Exploration Road Map

Survey barriers to increased exploration

Well Failure Analysis

Frontier Initiatives: Palaeozoic Study

Government funded seismic acquisition

Advanced, Leading Edge Seismic seminar to revive mature exploration, unlock discovered undeveloped, 4D driven infill

14 - 24 Billion Barrels total of which 3-9 Billion Barrels YTF

Rockall Trough4284 line km proposal

Mid North Sea High 10402 line km proposal

Presentation title - edit in Header and Footer 11

Progress in Rockall Imaging

Proactive Collaboration

CNS/MF CNS/Moray FirthPDA Post Drill AnalysisITT Invitation to Tender

New Plays Mapping

1st Pitfalls Conference

2nd Pitfalls Conference

3rd Pitfalls Conference

ITT, contract awards and acquisition

PalaeozoicKick-off

CNS/MF PDA Kick off

Scoping Study

21st Century Exploration Road Map

CNS, NNS Orcadian Basin, and Irish Sea studies

Phase 1 Delivered

Multi Company Seminars, Presentations & Final Report

Seismic Business

Case

£20m awarded

License Round

2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q2 2016 Q4 2016Q1 2016 Q3 2016

Advanced Seismic Technology

13

Seminar 7th September

Invitations from OGA

Geophysical experts

Exploration Managers

MD’s

Location: BP visualisation Suite

Chair Ron Roberts Apache

What can technology unlock? Salt diapirs Palaeocene & Eocene Fulmar Skagerrak plays HPHT – Redevelopment 4D Permian of CNS Carboniferous SNS Is the secret in the acquisition or

processing?

Timing license duration very tight for frontier and difficult geology

Potential to further differentiate frontier and mature areas

Frequency of acreage offerings

Merits of ‘stratigraphic licensing’ with the ‘right to roam’ into fallow horizons on held acreage

Model JOA’s majority versus unanimity

Simpler access to infrastructure model agreements

14

Licensing Issues/considerations

Shoot and process 15,000 km of new regional 2D seismic lines in the Rockall Trough

and Mid North Sea and make it available to industry in Preparation for a licence

round next year.

The joint OGA and industry funded evaluation of the Palaeozoic play (Which ties in to

the seismic)

An analysis of the results of 97 wells in the Central North Sea, leading to greater

understanding of risk and improved stewardship.

15

OGA Exploration Deliverables 2015

A work shop on 3D seismic technology to promote wider understanding of the cost

benefit in the context of MER ( Sept 2015)

Complete engagement with the geophysical Industry and draft new improved data

management and access to data in particular legacy seismic data and consistent well

data

Complete a strategic review of the UK licensing strategy providing improved access

to prospective areas?

16

OGA Exploration Deliverables 2015

Will industry respond by active participation in the 29th round by bidding further 3D seismic and firm wells?

What further steps, fiscal, licence, or regulatory would increase the pace of exploration activity?

What else could be done to support maximising economic recovery accelerating hydrocarbon maturation through exploration?

Is the industry using this time to replenish the hopper of opportunities?

17

Questions for Industry

Exploration Activity, Fiscal Change and Investment Trends – a case for intervention

Brian NottageHannon Westwood

Exploration activity, fiscal

change and investment trends –

a case for intervention

Market conditions

• Oil price

o Steep fall from September last year

o Slight recovery then further downward

pressure

Brent under $64/bbl

WTI under $60/bbl

o ICE forward curve shows slow recovery

Growing consensus around this

• E&P activity levels and investments expected to

fall

o Global rig utilisation falling

o “27 North Sea rigs will be seeking new

contract commitments in the coming

months, nearly one-third of the entire fleet”

(North Sea Reporter)

• Project cancellations/suspensions – UK and

Norway

• Pressure to reduce costs

• Consolidations, asset sales, farm-outs expected

Challenging environment even before the fall in oil price

• UKCS – long term decline in E&A

o 2014 - only 13 of the expected 25 wells

actually drilled (excluding sidetracks)

o Just 8-13 new exploration spuds forecast

for 2015

• High unit costs for Capex and Opex

• Significant cost over-runs and start-up delays

on a number of projects

• Declining revenues for E&P companies as

production continued to fall

• Negative cash flow of £5.3 billion in 2014, the

worst position since the 1970s.

Near-term developments – breakeven analysis

Challenging environment even before the fall in oil price

• UKCS – long term decline in E&A

o 2014 - only 13 of the expected 25 wells

actually drilled (excluding sidetracks)

o Just 8-13 new exploration spuds forecast

for 2015 (depending on oil price)

• High unit costs for Capex and Opex

• Significant cost over-runs and start-up delays

on a number of projects

• Declining revenues for E&P companies as

production continued to fall

• Negative cash flow of £5.3 billion in 2014, the

worst position since the 1970s.

E&A Drilling Activity

• Activity down on UKCS

Decreasing since 2007

8 new starts so far in 2015: 5 exploration

and 3 appraisals (excl. sidetracks)

• Activity up on NCS

Increasing since 2005

• Netherlands stable since 2004

Recent increase

Exploration Performance

• Commercial volumes discovered erratic

year-on-year

• Overall decline in volumes found

• Average commercial discovery size down

from c 50 mmboe to < 20 mmboe

o No significant discoveries (>100

mmboe) since 2008

o Only 28% reserves replacement

achieved

• Overall success rate relatively high and

comparable to Norway

• Commercial success rate declining

Reasons for decline in UKCS exploration1. Lack of funding for exploration/flight of capital

2. Lack of availability of drilling rigs

3. High tax levels and fiscal instability

4. Maturity of the basins and perceived lack of remaining prospectivity and materiality

5. High exploration costs – regulatory response to Macondo, 2010

6. Access to infrastructure

UK E&A Spend

Key Fiscal Changes

• Investment Allowance:

o The allowance will exempt a portion of profits equal to 62.5% of a company’s

qualifying investment expenditure, incurred on or after 1 April 2015, from the

Supplementary Charge

o Available for projects in both new and existing fields.

o Simplify the existing system of offshore field allowances

• Supplementary Charge:

o Reduced from 30% to 20% with effect from 1 January 2015.

• Petroleum Revenue Tax:

o Reduced from 50% to 35% , resulting in a headline rate for PRT-paying fields of

67.5 per cent

o to encourage investment in incremental projects in older fields and extend the life

of key infrastructure needed to make small new discoveries commercially viable.

o With effect from 31 December 2015.

But what about exploration?

• Lack of an effective stimulus for exploration

• Falling exploration levels have resulted in few

commercial discoveries

• Development hopper has not been replenished

• Investment levels will fall sharply despite the

fiscal measures introduced by the Chancellor.

• The government gave an undertaking in the

autumn statement to “consider options for

supporting exploration through the tax system,

such as a tax credit or similar mechanism, in a

way that is carefully targeted and affordable”,

…… but it has yet to deliver.

• The government did confirm the provision of

£20m for seismic surveys, but this will have little

effect

• Exploration is the lifeblood for the long-term

future of the UKCS and more robust action is

needed from both HMT and OGA including:

o An appropriate fiscal stimulus; ca Norway

o State-sponsored seismic and pre-

competitive geoscience in both mature and

frontier areas;

o Early release and more effective sharing of

data and information;

o Clarification of the remaining potential and

prospectivity of the UKCS; and

o Revisions to licensing policy to include a

long-term strategy and regular but more

focussed licence rounds.

• These actions are necessary for the UKCS to

become more competitive internationally for

exploration.

Much needed interventions

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Norway E&A Wells

Appraisal Sidetracks

Appraisal Spuds

Exploration Sidetracks

Exploration Spuds

Oil Price (US$)

The consequences of inaction

• Low exploration levels since 2008 have

resulted in few new development

opportunities.

• This has damaged future investment

potential in the UKCS

• Investment spike has run its course – fewer

and smaller projects coming through

• C 3 bn boe and £40 bn of investment are at

risk from continued low exploration levels.

• Future radical fiscal and regulatory changes

still required to stimulate exploration

o prolong the life of the basin

o maximise economic recovery

Hannon WestwoodBrian Nottage

7 Queens Gardens

Aberdeen AB15 4YD

Tel: +44 (0) 1224 619 341

e-mail:

[email protected]

Hannon WestwoodKaren Alford

100 Brand Street

Glasgow G51 1DG

Tel: +44 (0) 141 534 7903

e-mail:

[email protected]

[email protected]

Questions..?

Moray Firth – Central North SeaPost Well Analyses

Christian MathieuTeam Leader, Exploration Road Map Project

Oil and Gas Authority

Moray Firth – Central North Sea

Post well analyses

21st Century Exploration Road Map ProjectChristian Mathieu

Project

Objectives, Time-Line and Status

Moray Firth – Central North Sea

Post well analyses

3521CXRM Project – MF – CNS Post well analyses_Ch.Mathieu_17th June 2015

2003 – 2013 Wells (E&A) to be looked at:

150 Exploration main bores + Exploration Side-tracks have been drilled over

this 10 years period by 42 Operating Companies.

Project tried and understood the reasons for failure of the dry wells and a few

“technical” successes.

98 such wells (currently owned by 24 companies) have been reviewed >>> 104

segments successfully analysed.

CENTRAL NORTH SEA

MORAY FIRTH

Project Objectives• Part of the 21st Century Exploration Road Map recommended by ETF (“Exploration

Task Force”) and aligned with Sir Ian Wood Review.

• Project entirely sponsored by DECC / OGA.

• Rigorous well failure analysis in Moray Firth (MF) and Central North Sea (CNS) conducted by DECC / OGA together with Industry. Wells drilled 2003-2013.

• Objectives:

• To fully understand the reasons why a prospect was drilled (i.e. Geological and Petroleum settings)

• To better understand the reasons for success and failure in Exploring MF and CNS during the last 10 years

• To share the main findings with the Industry

• To test the Collaborative Model.

36 21CXRM Project – MF – CNS Post well analyses_Ch.Mathieu_17th June 2015

Project Time Line and Status


• 22 Companies (over 24) opened their “books” during “one to one” workshops

• Summary results for each well / each explored segment gathered into a Post Well Analysis Sheet

• Number of Post Well Analysis Sheets completed = 104 belonging to 97 wells (compared to 98 wells initially

targeted)

• Preliminary findings have been presented at the O&GUK 2nd Pitfalls in Exploration Conference (London,

05th February 2015).

• Multi-companies workshops gathering companies having drilled in the same Geological Basin / Entity to

be held (16th June – 09th July 2015).

• Final report + Final presentations to be delivered September 2015.

Establish

One to

One

meetings

Review PGS

Megasurvey

for

applicability

to Study

Present to

Pitfall

Conference

Recommendations

1st Phase 2nd Phase 3rd Phase Reporting

Gather data from each Company

Review Preliminary

Observations

Conduct workshops (2nd batch)

Peer Reviews = Seminar involving Companies working in the

same Geological Basin / Entity

Detailed Analysis

Report

September

2015

Preliminary Review

of DECC data bases

Identify Key

Companies

Conduct workshops (1st batch)

Gather data from each Company

April May June

2014

July AugustOctober November December January February March

One to One Workshops Multi Companies

Regional Seminars Report writing

Project

Set-up

Presentations

Post well

Analysis Sheet

• Upper section > general information about the well

• Left hand section = pre drill G&G prospect description and pre-drill risking

• Right hand section = Well results

• Right hand columns =

• Basal section: Seismic data and reports used pre- and post-well.

• Summary results + What could have been done differently?


Prospect Name: Block name:

Well Category: License:

Segment name: Spud date:

Segment HC result: End date:

Segment overall COS: 1

Play: Age:

Source Rock:

Trap type:

SOURCE ROCK: Kimmeridge Caly Fm. (Jurassic) PS (%)

M

M

M

M

PS (%)

RESERVOIR: PS (%) U

M

Mini Mode Maxi

118 W

30 50 80 M28 28 28 M

70 70 70 M

DHI: Type: Oil saturation Downdip of crest

Reliability: U

TRAP GEOMETRY: PS (%)

Well Result

Top reservoir (TVDss ft): -6279 -39 M

13.7 -6294 -196 - W

N/A - Strati trap. Belinda discovery ODT used as OWC. - - - M0.462 270 35 -235

100

Seal: PS (%) M

U

M

Fluid: PS (%)

Fluid: Flow: Choke: M

2830 BHP @ -6240 ft TVDss U

70° U

30°-33° U

400 U

P90 P50 P10 Low Best High

58 112 180 6 13.5 16.5 W

- - - Not calculated but gas column assumed 7 10 14 W

Low Best High

17 34 54 1.8 4 5 W

- - - Not calculated but gas column assumed 5 7 10 W

- - - - - - -

- - - - - - -

Yes No

Main Post-Drill versus Pre-Drill Differences:

1 1

2 2

3 3

Date: U:\EMI\Energy Development\LED Area\EXPLORATION\EXPLO ROAD MAP PROJECT\POST WELL ANALYSES_MF_CNS\Post Well Analysis Sheet\1-Completed Post Well Analysis Sheets

Upper Tay sdsts

Fit with structure:

Very low. 1D modelling on 4 neighbouring wells showed that oil and water signatures were similar. 1D

modelling not used for pre-drill de-risking.

DHI post-well interpretation:

Very little emphasis was put on the apparent DHI pre-drill and given the well result there was no follow-up study.

Average at Well

31 Feet

69%

33%

65%

Net Oil Pay = 8ft

above OWC

Permeability / Diagenesis: Good permeability assumed in excess of 1-2 Darcies.

Effective pathways:

HC migration timing:

Palaecocene Sstn carrier beds assumed to be proven. Migration modelling carried out pre-drill did

not address the stratigraphic trap. Trap is possibly underfilled (?).

Timing good

Post drill calculated volumes are not within the pre-drill volumes which were too optimistic. The use of the Belinda discovery ODT was too optimistic and a wider range of possibilities should have been considered.

The seismic stratigraphic approach, although interesting, lead to loss of the overall picture >> the pre-drill volumes were too optimistic.

It is unclear whether improved seismic data would have been beneficial.

Reports and References (Maps…etc…):

3D over the entire block

2 proprietary surveys and Western Geco spec survey

2006 reprocessing by Spectrum

1) Spitfire Exploration Well 21/30-T (20) Geological Prognosis and Evaluation Programme, May 2008

Do the Well Results fit with the Pre-Drill Geological Model?

Inferred Reasons:

Reservoir much thinner than prognosed.

Massive overestimation of volumes in place and corresponding resources.

OWC 196 ft shallow to prognosis.

Likely imperfect bottom and / or lateral seals.

It was incorrect to assume the sands were connected to the Belinda discovery.

Other potential reason would be that necessary hydrocarbon volumes have not migrated into the structure.

Seismic Data Set:

Resources:

2D / 3D ?

Survey name:

Processing / Reprocessing:

SUMMARY RESULTS

Oil / Condensate (MMbbl):

Gas (Bcf):

Oil (MMbbl):

Associated Gas (Bcf):

Dry Gas (Bcf):

Condensate (MMbbl):

Comments

30% RF

70% RF

NB: PGS MC3D WCG2011 is now available on the market.

W

1) Spitfire Post well summary.pdf, 25th Nov 2014

2) 2008 BERR Fallow Blocks Review, 03rd September 2008

Temperature (degC):

Density (API):

GOR (scf/bo):

100

Oil + minor gas cap

In Place Volumes:

HC fi l l (%):

100Including Top, Lateral and Bottom if needed

Horda Fm. top seal and Balder Sstn and intra-formational bottom seals. Proven in nearby wells.

Expected Fluid:

Pressure (psi):

The Spitfire prospect is a stratigraphic trap in the Upper Tay Sandstone Member. This is formed by a

detached sand body that shales-out up-dip to where the Upper Tay interval is shale in Evelyn wells 21/30-12

and 21/30-16 to the west. There is small 4-way dip closure where the sands appear to be “mounded” in the

seismic trace data, interpreted to be caused by a combination of depositional shape and post-depositional

differential compaction.

Top Reservoir at Top Structure (ft TVDss): -6137

Closed area (km2):

Vertical closure (ft):

Gross Rock Volume (km3):

Balder Fm.

0.65

0.45

Oil generation in the deepest part of the Central Graben started during the Maastrichtian and peaked during

Miocene to Pliocene times. Regionally oil and gas charging occurred mainly by upward or via long distance

lateral migration. Extensive distribution of underlying Palaeocene Sstn has provided excellent regional lateral

migration conduits. Migration from the Palaeocene into the Eocene is thought to have been facilitated via

Miocene age faulting. Migration modelling carried out pre-drill but focus on Highs.

Including Presence, Quality

Gross Thickness (ft)

Net To Gross Ratio (%)

Porosity (%)

HC Saturation (%)

Expected Lithology: Interbedded relatively soft claystones and fine to medium grained, friable turbiditic sandstones.

Well Results

Presence:

Quality:

Maturity:

Effective HC kitchen:

Not penetrated but no reason to consider source to be absent in area

Not penetrated but no reason not to consider source quality to be similar than for Belinda and Evelyn discoveries.

Assumed mature due to oil presence in well

Central Graben

Presence, Continuity: Present. Unknown continuity.

Including Presence, Quality, drainage Area…

Kimmeridge source rock present. Good quality with TOC 4-7%.

HC MIGRATION /TIMING: Including Migration Pathways… 0.85

Post Well Analysis Sheet

Spitfire

Exploration Well, P&A

"T" - Spitfire

15ft oil leg

19th June 2008

21/30

P013

27% Number of Segments:

3rd July 2008

Pre-Drill segment description

100

+/'- to prognosisWell Prognosis

Interpreted horizons: Intra-Horland, Horda, Top Tay Sand package (diachronous), Balder and Top

Chalk. Amplitude extraction studies in Top Tay Sand. Well results indicate picking was good.

Target interval is shallow and has little lithology variation so a VoK function was used: Vo =

5558ft/s, k=0.3s-1. Well results indicate this was an optimal solution.

-6240

RESERVOIR

M

DHI

U

Pre-Drill prospect assessment versus Well Results Comparison

Overall Match*

SOURCE ROCK

M

Seismic picking:

Kimmeridge Caly Fm. (Jurassic)

Combination stratigraphic and dip closure

Upper Tay Sandstone Member Eocene

7094 ft

OWC (TVDss ft):

GWC (TVDss ft):

Comments

-6490

-

Comments

Within error

Much higher to prognosis than expected

Not penetrated

Well did not penetrate the crest of the

structure so the 15ft HC column is proven

and the remainder is assumed attic

hydrocarbon

Top Seal Lithology:

Oil No test or samples taken

Bottom Seal Lithology:

Lateral Seal type (fault, facies change…):

Shale, Horda Fm.

Facies change required. It is believed that an imperfect lateral /base sdeal is the cause for

the low hydrocarbon volumes.

Shale, Balder Fm.

25/11/2014 Workshop Date: 25/11/2014

Single

Parameters

Check *

U

M

M

M

M

W

Time to Depth Conversion:

Estimated HC column (ft):

Partly

Is there something which could / should have been done differently?

Comments

Seal Effectiveness (Breaching…)Partly proven as the OWC was found much higher than expected.

Company

(Well Operator):

Company

(License Operator):

Well Name:

Vertical / Deviated:

TD (MD):

TD (TVDss):

Formation at TD:

* Good Match (M)

No Match (W)

Unknown (U)

HYDROCARBON IIP

TRAP GEOMETRY

M

W

YY/ZZ-1

XX

XX

Deviated pilot hole

CHARGE

U

SEAL

W

FLUID

U

RESOURCES

-6769 ft

* Good Match (M)

No Match (W)

Unknown (U)

A few Statistics…

Setting the scene (1/2) 104 segments have been analysed, corresponding to 97 wells: 9 lacking overall Chance of Success (CoS) and/or detailed risking

assessment.

93% Exploration wells – 7% Appraisal wells.

62.5 % of these segments belong to post 20th Round licenses; 28.8 % were drilled on licenses awarded during the Rounds 1st to 7th.

90.4% were dry holes; 8.6% Technical successes; 1% Commercial success

Objectives:

– 38 % above BCU

– 56 % Jurassic

– 2 % Triassic

– 4 % below Zechstein Salt

33 % of the 104 analysed segments have been drilled because of some sort of “DHI”: AVO, amplitude, gas cloud, “impedance indicator”…etc…

Chance of Success

34% of the 98 segments with available pre-drill risking fall within the 21 to 30% CoS (i.e. what you would expect in such mature Basins).

But 40% of these segments have CoS > 31%: this highlights a trend towards over-confidence in the risking assessment.

Number of causes for failure: 3 main reasons = 38.8%; 2 reasons = 48.6%; 1 reason = 12.6%

The main risk was not adequately predicted in 36 %


Objectives Trap types


• 38 % above BCU

• 56 % Jurassic

• 2 % Triassic

• 4 % below Zechstein Salt

NB: Sum (>104 as several traps are Combined 4 way dip

closure

/ stratigraphic upside)

• 55 % Stratigraphic traps

• 45 % Structural traps

Setting the scene (2/2)

28 %

Purely

structural

Tilted fault

blocks

Downthrown

TerracesStratigraphic

Pinch-out, Channel…

Interpod

Mound,

reef… Injectites

4 way dip

Eocene

PaleoceneUpper Cretaceous

Lower

CretaceousUpper Jurassic

Shallow Marine

Upper

Jurassic

Deep Water

Middle Jurassic

Triassic

RotliegendesDevonian Tertiary

Plays = 23 %

Cretaceous

Plays = 15.4 %

Upper Jurassic

Plays = 52.9 %

Reasons for Failure

Top seal efficiency is well assessed

even when it fails

Source Rock maturity too… except

on Basin margins

Main Reason for Failure (1/4)

Overall Main Reason for Failure


Target Reservoir absent

= 22.7%Reservoir Quality /

Connectivity = 5.4%

Lack of Trap = 17.3%Top

Seal

= 5.4%

Lateral Seal

= 27.3 %

Bottom Seal = 5.4%

Lack of Charge(Migration Shadow….) = 5.4%

Lack of Charge(Mig Pathways) = 6.3%

SR

Maturity

= 2.7%

DHI

(mispicking of Top

Reservoir) ~ 1%

• Seal ~ 38 %

• Reservoir ~ 28 %

• Trap ~ 17 %

• Charge ~ 14 %

Absence of Target Reservoir and Top Seal Failure

are acting effectively as “killing parameters”


Tertiary Plays (Eocene-Palaeocene)


Lack of Trap = 34.6 %

Lateral Seal = 19.2 %Lack of Bottom Seal

= 15.4%

Top Seal = 3.8 %

Target Reservoir absent = 7.7 %

Reservoir Quality = 3.8 %

Migration issue = 7.7 %“DHI” Issue = 7.7 %

Sample size = 24 segments

However, 20 (i.e. 77 %) have been drilled because of some sort of DHI

(AVO, amplitude, gas cloud, “impedance indicator”…etc…)

Another 2 were drilled despite AVO indicated the sands would be wet.

• “When looking at prospects that are solely dependent on AVO it is necessary to examine the pre-

conditioned gathers.

• Match amplitude response to shear log recorded in near by wells.

• Produce and risk the geological model unsupported by AVO. Does the play makes sense without

AVO support?

• AVO responses are modelled outcomes, not unique solutions. They do not eliminate risk.”


Upper Jurassic: Fulmar Fm. in an interpod setting


Limited sample = 7 segments

However all 3 reasons for failure highlight pretty well

what is requested to find such a trap being hydrocarbon

bearing.

Migration effectiveness is the 2nd reason for failure in 5

over 7 cases >> detailed pre-drill Basin modelling

should be carried out

Lateral Seal

= 28.5 %

Lack of Charge

(Migration Pathways)

= 28.5 %

Target Reservoir absent

~ 43 %

Triassic SB Pods

Fulmar segment

Tertiary

Basement


Upper Jurassic Deep water turbidites

(Buzzard, Ettrick, Peterhead…all kind of traps)


Target Reservoir

absent = 29 %

Lateral Seal = 38.7 %

Top Seal

= 12.9 %

Bottom Seal

= 3.2 %

Reservoir Quality = 6.4 %

Lack of Trap = 3.2 %

Lack of Charge

= 3.2 %SR immature

= 3.2 %

Sample size = 27 segments

The search for Buzzard look alike in adjacent Grabens failed;

it was mostly driven by conceptual analogy and on “notional”

prospects.

76.7 % are Stratigraphic traps

Well location

Lower Volgian

Sand Bypass Zone

Selected Interpretation Pitfalls

1) Map cut short

>> does not allow optimal

understanding of the trap


Top Fulmar Depth Map

Partners meeting

24th January 2006

Top Fulmar Depth Map (m TVDss)

TCM 31st March 2006

i.e. decision point

Potential

leakage zone

No way

to understand

the prospect

weak point !!

2) Seismic picking questionable

>> need for other advice (Peer review?)

>> need to improve QC


Pre-drill seismic pickingPost drill interpretation

3) Efficient seal and / or efficient sourcing

pathway ?


22/13A-1S122/12A-1

22/13A-1S1

22/12A-1

2000 4000 6000 8000 10000 12000 14000 16000

2000 4000 6000 8000 10000 12000 14000 16000

-400

0-3

600

-320

0-2

800

-240

0-2

000

-160

0

-4000-3600

-3200-2800

-2400-2000

-1600

570000 575000 580000 585000 590000

570000 575000 580000 585000 590000

6384

000

6392

000

63840006392000

Zechstein salt

Rotliegend basement

Skagerrak

Fulmar

Prospect

Source Rock =

Kimmeridge Clay Fm

Smith BankSmith Bank

Discovery 1 Discovery 2

WNW ESE

Thickness map of the

Source Rock >

Fulmar prospect outline

Conclusions

Conclusions – 1/2• Underestimation of the physical content of the seismic response:

– Well to seismic ties must be properly done >> impact on choice of the relevant horizon to be picked and / or on reservoir polarity

– DHI type and robustness must be double checked

– When looking at prospects that are solely dependent on AVO:

• seismic data must be properly processed prior to any AVO study

• Produce and risk the geological model unsupported by AVO. Does the play makes sense without AVO support?

– Seismic picking must not cut through valid seismic reflectors. Dual polarity displays should help more rigorous picking particularly in Tertiary or relatively shallow Plays.

– Prognosis of sand presence cannot only rely on “rules of thumb”, particularly when seismic data are poor /fair quality. Re-processing, acquiring new fit for purpose 3D data and rock physics modelling should be undertaken before locating wildcats on poor quality data

• Cognitive bias: Since the “X" discovery was just made, was there some kind of "cognitive bias" which led to a too fast move to drill what was deemed to be an analogue amplitude feature / an analogue stratigraphic trap?

• Drilling quality prospects should prevail against drilling as many wells as possible >> food for thought for the new OGA?

• In some instances, the operator was the sole licensee: being not far enough away to assess the prospect this resulted in over-confidence. >> food for thought for the new OGA?

• Access to information: In some instance the lack of access to a well recently drilled updip of the prospect lead to the drilling of another dry well >> food for thought for the new OGA?


Conclusions – 2/2

“Making accurate and unbiased prospect assessment is challenging. So is measuring assessment performance.”*

“Systematic tracking of Exploration results relative to pre-drill predictions is critical for improving both Assessment Performance and Exploration decisions”.*

“All efforts that can assist in delivering accurate, un-biased and consistent assessment will ultimately enhance company exploration performance.”*

In that respect the Post Well Analysis must be part of the full circle Quality Control process to be applied to the prospect assessment.


* from Charles Stabell

(GeoKnowledge AS)

Thank you for your attention !Thank you to all those who have been sharing with me on these post well assessments:

and cooperation from:


Progress on the Palaeozoic Study of the North Sea

Robert GatliffDirector, Energy & Marine Geoscience

British Geological Survey

BGS

21CXRM: The Palaeozoic ProjectRobert Gatliff (Director Energy & Marine Geoscience, British Geological Survey), Alison Monaghan (Project Manager) & the Project Team 17/06/15

Talk Outline

BackgroundProject ParticipationTimetableProgressVision

New, Different, Digital, Live, Collaborative & InclusiveNew exploration ....new finds...new developments.....multidisciplinary....data release..... training

• Recommendations and Actions from the Sir Ian Wood Report• Strategy for Maximising Economic Recovery (MER UK)• Increase successful exploration• Improve access to data – efficient access to well & seismic data• An up-to-date readily accessible digital geology of the UKCS• Better use of the expertise of the BGS

• O&G UK, DECC & NERC/BGS - funded consultation with industry• Palaeozoic Project most requested project

• DECC using contract with BGS to initiate project• Additional funding from industry• Collaborative Project across industry and government

Background

Background: British Geological Survey• 40+ years working with DECC (Licensing rounds, Promote, independent analyses,

unconventionals)• National mapping programme and Regional Reports• Joint-Industry Projects (Rockall, Faroe-Shetland Basin, Southern Permian Basin

Atlas, Edinburgh Anisotropy Project, CCS)• NERC Oil and Gas CDT• Co-location with Heriot Watt University• 516 scientists working with more than 40 universities• 70 PhD students• £48.5 million ~50% baseline from the NERC • More than 150 current private sector customers

• 20 bespoke science laboratories • National Geological Repository

Project Participation: Contracts and funding• £525,000 DECC; £100,000 BGS; £50,000 O&G UK

• 45 contracts sent to committed or interested parties

• 27 signed contracts, 9 more returned in signing/negotiation = sponsorship £555,000 giving overall project budget c. £1.18 million

Alpha PetroleumResources

Chevron Upstream MOL OPERATIONS UK Statoil (U.K.)

Antrim Resources Chrysaor Nexen Petroleum U.K. Talisman SinopecApache North Sea ConocoPhillips Origo Exploration UK TGS-NopecAtlantic Petroleum UK Dana Petroleum Parkmead (E&P) Total E&P UK

Aurora Petroleum Dolphin Geophysical PGS Verus PetroleumBayerngas Europe Dong E&P Premier Oil Plc WesternGeco

Limited/ Schlumberger

BG Group Dyas UK Dea UK SNSBP E.ON E&P UK SenergyCairn Energy GDF Suez E&P UK ShellCentrica Energy Maersk Oil North Sea UK Spectrum

Palaeozoic Project – Key Objectives•Searching deeper and wider than the conventional hydrocarbon horizons

•Develop a strong, consistent regional data-set to provide a platform for morespecific oil & gas exploration studies

•Develop new scientific understanding

• that down-risks some of the critical play elements

• that stimulates new ideas for plays and prospectivity

•Provoking

• new data acquisition

• additional analysis and interpretation programmes

•Leading to

• licence activity

• significant exploration well activity

• economic commercial success rates

Timetable

2014-15

2015-16

2015-16

Phase 1: December 2014- March 2015 (DECC funding): Initial projectsPlanning for main projectIP: data access issues

Phase 2: February 2015 – March 2016Main collaborative project with Sponsors

Delivery to Sponsors 2016Open 2017

Timetable continued

Project PreparationOrganising ContractsProject Board and Technical Steering CommitteeContributions from operators

Data, interpretationsContributions from Spec companies

Access to dataPublication of results

Contributions from Service companies/ specialist servicesExpert servicesSoftware

CDA data supplyAcademia

NERC innovation fundingNERC oil & gas CDT

?Contributions from adjacent GeologicalSurveys

TNO/EBN; GEUS; NGU/NPD; GSI/PAD

Data collation Project is developing a consistent regional (digital) dataset to provide a platform for more specific oil & gas exploration studiese.g. stratigraphic tops, biostratigraphy, organic geochemistry, vitrinitereflectance. Focussed on the Carboniferous and Devonian

The underlying digital dataset is a key project deliverable

Strength of the project is to have access to DECC-CDA, BGS, Sponsors etcdatasets

Example of well data locations (core and cuttings) for data collated on source rock organic geochemistry

Project progress – current ongoing work

Central North Sea-Mid North Sea High

• Seismic and well interpretation

• Gravity and density study

• Revision pre-Permian subcrop map

• Well log analysis, source and reservoir rocks

• Source rock geochemistry

• Maturity, burial/uplift, migration and charge modelling

• Regional petroleum systems and tectono-stratigraphic synthesis -between Millennium Atlas and block scale

Orcadian Basin and Irish Sea

Well and seismic data collation and interpretation

Ongoing work – seismic interpretation and agreements

Seismic datasets used Central North Sea-Mid North Sea High area. Wells penetrating Carboniferous or older strata shown.

• Discussions and agreements with seismic companies

• Permissions andconfidentialityagreements for seismicdata - making progress

• Agreement from seismiccontractors for 5 kmresolution grids as ProjectResults

Gravity features in NW

part of study area

ENE (Iapetus) trend dominates

Gravity study aims to delineate

Devono-Carboniferous basins in

areas of variable seismic data

coverage

Carboniferous

half-graben

Major pre-Zechstein fault

Gravity gradient zone

parallel to the Permo-

Carboniferous dyke trend

Oldhamstocks:

basin or granite?

Tweed Basin

Northumberland

Trough

NFF

Stainmore Trough

Intra-Lower Palaeozoic density

variations in the Southern

Uplands (2.69-2.75 g/cc)

G

G

G

G

PFF-trend?

GG

G

G

SUF offset?

Intrusion?

G = Granite NFF = Ninety Fathom Fault PFF = Pressen-Flodden-Ford SUF = Southern Upland Fault

Ongoing work – gravity and density study

Numerous Devonian, Carboniferous basins, highs and platforms in this area

Granites play a major role in basin configuration

Ongoing work – structure, development of Palaeozoic basins

Part of the BGS 1:1 500 000 Tectonic Map of Britain, Ireland and adjacent areas. Pharaoh et al 1996 ©BGS/NERC

Strong control by basement and inherited Caledonidestructures (e.g. Iapetus, Tornquisttrends)

Structural trends and styles vary across the area

Onshore to offshore structures mapped in more detail

Existing maps such as the one below show a relatively ‘blank’ area Seismic, well and gravity interpretation are proving :

Ongoing work – well correlations, palaeogeography

Taking a fresh, evidence-based approach. Key aspects:• Biostratigraphy collated from CDA, Sponsors, BGS core store etcBiostratigraphic data donations/gathering has made a real difference• Integration with seismic on a regional scaleAppreciation of regional basin configuration and ties, rather than block scale• Application of modern stratigraphy and insights onshore-offshore• QC by project Sponsors

•Moving forward on risks, outcomes, focussing studies – different challenges in sub-areas of CNS

•Integrated studies now ongoing e.g. source rock extent, maturity, geochemcharacterisation etc

Ongoing synthesis

Using gravity & seismic data to delineate basins. Source rock

Applying knowledge of proven play to north

Northerly limit of source. Maturity, migration and charge

Source rock –presence, maturity, charge.

Additional Devono-Carb prospectivity?

Timing of maturity, charge vs trap formation. Data quality

Geologically based sub-areas within the CNS with wells penetrating Carboniferous and/or Devonian strata shown, with some key risks/outcomes shown

Using onshore data/ knowledge

Technical Steering Committee (TSC) meetings andfield workshop

TSC meetings wellattended by Sponsors

Field workshop toScremerston Fm -Yoredale Fmsection May 2015

Photo credit: Sarah Hannis

Encouraging collaboration

Technical Steering Committee

SponsorsBGS teamDECC/OGAO&G UK

PresentationsWorkshopsCompany to company discussionsEncouraging feedback, input and QC

One to one meetings BGS-Sponsors

Data donations from Sponsors and others

Delivery of project with new seismic data March 2016: in line with new licensing round

Vision

• First of several studies• Leading to a free-to-use 3D model of UK geology• Regular updates• Encourage more release of data – well logs and seismic data on

the web• Crowd sourcing and wiki style innovations• More sharing and collaboration• Improve UK access to rival that of Norway or the Netherlands• Make the UK an easier place to explore

Exploration - The 21st Century AgendaPanel Session

Chaired By

Oonagh WerngrenOperations Director

Oil & Gas UK

Documents

Exploration - The 21st Century Agenda - Oil & Gas UK€¦ · 21st Century Exploration Road Map Survey barriers to increased exploration Well Failure Analysis Frontier Initiatives: