abc oil and gas - ogee lite is coming plant estimate -sample.pdf · report no: smp-0002 powered by...

ABC Oil and Gas

Aug 19th, 2016

Report No: SMP-0002 Budgetary Plant Estimate

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Report No: SMP-0002

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Contents Executive Summary 3

1.0 Assumptions 3

Napkin Assumptions 3 1.1.

Client Discussed Assumptions 4 1.2.

Ogee Assumptions 4 1.3.

2.0 Scope of Assessment 4

3.0 Results 5

Estimate 5 3.1.

Estimate Basis 6 3.2.

Project Schedule 6 3.3.

4.0 Additional Considerations 7

Modularized Design 7 4.1.

Logistics of Personnel 8 4.2.

Stakeholder Consultation and Regulatory Approvals 8 4.3.

Availability of Labour 9 4.4.

5.0 Further Assistance 9

Appendix A: Client Supplied Ogee Napkin 11

Appendix B: Process Flow Diagram 12

Appendix C: Plot Plan 14

Appendix D: Plant Process Simulation 16

Report No: SMP-0002


Executive Summary

ABC Oil and Gas is considering an expansion of its northern development program. The capacity of their existing gas plant is limited; therefore, ABC Oil and Gas is exploring the feasibility of installing a new, green field plant to process 35 MMscf/d of sweet raw gas from the field. The raw gas is expected to contain levels of hydrocarbon liquids and entrained water of upwards of 2500 bbl/d of both hydrocarbon liquids and produced water.

Ogee has developed a budgetary estimate of $112,117,800 (-20%/+50%) for a sweet gas processing plant with a capacity of 35 MMscf/d and 2500 bbl/d of hydrocarbon liquids and 2500 bbl/d of produced water, producing pipeline quality sales gas, as well as LPG (C3/C4 mix), stabilized condensate and produced water stored on-site.

1.0 Assumptions

Napkin Assumptions 1.1.

As per the information submitted through the OGEE Napkin on August 15th, 2016:

Assessment Type: Gas Processing Plant Location: Northern Shale Region Commodity: Natural Gas Sweet/Sour: Sweet Conditions: ABC Oil and Gas is considering an expansion of its

northern development program. The capacity of their existing gas plant is limited, and therefore ABC Oil and Gas is exploring the feasibility of installing a new, greenfield plant to process 35 MMscf/d of raw gas from the field. The raw gas will contain high levels of hydrocarbon liquids and produced water. A budgetary estimate is required for a processing plant to produce pipeline quality sales gas, as well as LPG (C3/C4 mix), stabilized condensate and produced water stored on site.

A copy of the submitted Ogee Napkin is included in Appendix A.

Report No: SMP-0002


Client Discussed Assumptions 1.2.

As per the OGEE kick-off call on August 10th, 2016, the following are the assumptions discussed with the client:

Flow Rates and Pressures:

• 35 MMscf/d Sweet Raw Gas

o Inlet Pressure: 5,000 kPag,

o Inlet Temperature: 10oC,

o Outlet Pressure: 7,500 kPag.

• 2500 bbl/d Hydrocarbon Liquids & 2500 bbl/d Produced water via dedicated inlet liquid pipeline

o Inlet Pressure: 2,500 kPag,

o Inlet Temperature: 10oC,

• Onsite storage capability.

Ogee Assumptions 1.3.

The following are assumptions Ogee has made to complete this report:

• Industry standards for sales gas is assumed,

• Storage for produced water, LPG and stabilized condensate is required.

2.0 Scope of Assessment

OGEE has reviewed the general process conditions outlined in Section 2.0 to provide a budgetary estimate (-20%/+50%) for a 35 MMscf/d sweet gas processing plant. See Appendix B to D for preliminary documents included to support the estimate.

• Process Flow Diagram

• Plot Plan

• Plant Process Simulation

Report No: SMP-0002


3.0 Results

Estimate 3.1.

Table 1 below is the budgetary estimate for a sweet gas processing plant based on the assumptions of Section 1.2.

Table 1: Sweet Gas Processing Plant Budgetary Estimate

ITEM QUANTITY UNIT TOTAL COST

Major Equipment 1 Inlet Gas Separator, 3 Phase 1 Each $675,000 2 Inlet Liquid Separator, 3 Phase 1 Each $785,000 3 Condensate Stabilizer 1 Each $1,925,000 4 Stabilizer Overhead Compressor 1 Each $1,275,000 5 Inlet Gas Compressor 1 Each $2,625,000 6 Refrigeration Plant 1 Each $3,275,000 7 De-Ethanizer 1 Each $1,950,000 8 De-Butanizer 1 Each $1,950,000 9 Stabilized Condensate Storage Tank 2 Lot $1,800,000 10 Produced Water Storage Tank 2 Lot $1,800,000 11 LPG Storage Bullet 1 Each $304,000 12 HP Flare Knockout Drum 1 Each $235,000 13 LP Flare Knockout Drum 1 Each $140,000 14 Flare Stack (HP/LP) 1 Each $125,000 15 Sales Metering/Fuel Gas Building 1 Each $680,000 16 Power Generation (Gas) 2 Lot $3,450,000 17 Power Generation (Diesel) 1 Each $1,350,000 18 Instrument Air/MCC 1 Each $852,500 19 Heat Medium System 2 Lot $1,100,000 20 Control Room 1 Each $160,000 21 Total Major Equipment $26,456,500 22 Construction Material and Labour Costs $40,500,000 23 Total Indirect Costs $26,475,000

Subtotal $93,431,500 24 Contingency 20 % $18,686,300

TOTAL INSTALLED COST (TIC) $112,117,800 ESTIMATE RANGE (-20% to +50%) $89,694,300 to $168,176,700

Report No: SMP-0002


Estimate Basis 3.2.

The Major Equipment Cost Estimate (Line Item 21 of Table 1) is based on the actual purchase price of the equipment by Solaris-MCI for projects of similar scope. The Construction Material and Labour Costs Estimate (Line Item 22 of Table 1) and the Total Indirect Costs Estimate (Line Item 23 of Table 1) are based on the experience of Solaris-MCI with this type of installation.

Total Indirect Costs include estimates for the following:

• Contractor Indirect Field,

• Construction Management,

• Material Related Costs,

• Camp, Housing, Craft Transportation,

• Engineering and Professional Services,

• Start-Up and Owners Costs.

Project Schedule 3.3.

It is estimated that the project timeline, from project initiation to commissioning and startup is approximately 29 months. A breakdown of major project milestones is provided in the table and figure below.

Table 2: Major Project Milestones

PROJECT MILESTONE DURATION

1 Front End Engineering and Design (FEED) 6 months 2 Detailed Design/Long Lead Equipment 11 months 3 Procurement * 5 months 4 Regulatory Consultation/Notification and Approvals * 6 months 5 Construction 10 months 6 Commissioning and Startup 2 months

*concurrent with line item 2 of schedule

Report No: SMP-0002


Figure 1: Major Project Milestones

PROJECT MILESTONES – 29 MONTH DURATION

1 2

3 4

5 6

4.0 Additional Considerations

The following items should be considered as the project progresses into more detailed phases, as they can impart significant risk to the total cost and schedule.

Modularized Design 4.1.

A modularized design approach should be considered and incorporated at the project initiation stage. Current industry practices suggest that it is more cost effective to build equipment skids and pipe rack modules in fabrication yards transported to site as opposed to field erection for most cases. Applying actual value regarding costs savings is difficult to determine in the feasibility stage of a project; however, industry experience suggests cost reduction in the order of 25%.

Benefits:

• Quicker site erection and ease of constructability,

• Better quality control in a shop environment,

• Reduced safety risk associated with personnel,

• Lower transportation costs of modules vs. multiple materials,

• Reduced site manpower and camp/subsistence cost.

Risks:

• More stringent piping design and constraints,

• Less flexibility for scope changes and adjustments,

Report No: SMP-0002


• Less time for design input from stakeholders.

Logistics of Personnel 4.2.

When considering the logistics of personnel, the location of the plant in relation to existing municipal infrastructure or camp facilities and various modes of transportation for labour to/from site should be investigated, with each option evaluated on the following factors:

Safety:

Safety of personnel should be of the utmost importance as one accident could prove detrimental to the project. An in depth analysis should be performed at a later date to determine the risk tolerance of each option per the company’s risk matrix.

Cost:

Cost varies with the method of travel. Capital cost invested up front, such as the construction of camp facilities or subsidized housing, may minimize the cost of travel throughout the life of the project. Capital projects that to pertain to the movement of personnel may also be shared with operators in the area.

Social impact:

Generally when travel durations are shortened, either by locating the facility to existing municipalities with a pool of labour or through efficient modes of transportation to/from site, produces higher moral which results in overall cost savings.

Stakeholder Consultation and Regulatory Approvals 4.3.

This project is regulated under the Oil and Gas Commission (OGC) and the Oil and Gas Activities Act (OGAA) of British Columbia. Based on the scope provided for this project, an Environmental Assessment Certificate will not be required; however, a new facility permit is necessary prior to commencing construction. While not expressly required, guidelines for BC recommend an assessment of resources and environment surrounding the development. Potential impacts include: fish and wildlife habitats and movement patterns, soil and permafrost disturbances, erosion and sand control, surface water quality and waste material management.

While completed facility permits generally take 4-6 weeks for the OGC to approve, the timeframe for the regulatory process is much more subject to consultation with

Report No: SMP-0002


community stakeholders and First Nations groups, sometimes prolonging the process months beyond schedule. As a result, proactive engagement with all stakeholders as early as possible is recommended to remedy any concerns and mitigate possible setbacks.

Availability of Labour 4.4.

The availability of labour resources will be affected by competing projects in the region and more generally by the skilled labour pool in Western Canada. Additionally, as opportunities arise in sectors that are not oil and gas related closer to large municipal centers, attracting a qualified workforce to remote areas may prove difficult. When the project schedule is established, competing projects and the labour pool should be investigated and monitored to ensure project milestones coincide with the availability of the personnel forecasted for that timeframe.

5.0 Further Assistance

In the event that you require this project to be carried to the detailed engineering phase, OGEE will connect you with Solaris-MCI, our fully-integrated, multi-discipline engineering firm, to discuss options.

Report No: SMP-0002


Note: This document is not an engineering or design document. This document is provided for general information purposes only and does not replace the requirements and details in the acts, regulations, standards and other applicable documentation, including any amendments, updates, revisions, etc. The user is still responsible for ensuring that the facility or pipeline complies with all requirements, irrespective of the information provided in this document.

Report No: SMP-0002


Appendix A: Client Supplied Ogee Napkin

Report No: SMP-0002


Appendix B: Process Flow Diagram

Report No: SMP-0002


Appendix C: Plot Plan

Report No: SMP-0002


Appendix D: Plant Process Simulation

InletHC

Inlet GasSeparator

1

2

3

InletLiquidSeparator

4

5

6MIX-103

ProducedWater

CondensateStabilizer

MIX-104

7

8

9

CSReboiler

10

O/H1

MIX-105

11

O/HComp1

O/HComp2

12

O/H2

MIX-106

13

InletComp

14

Inlet

AirCooler1

15

AirCooler

VLV-10035

Gas/GasTube

16

G/GShell

GasChiller

17

Refrig2

LeanEG

LTS

19

20

RichEG

Gas/GasShell

SalesGas

G/GTube

DEthReboiler

FG

23

DEthCooler

MIX-107

28

VLV-10224

De-ethanizer De-butanizer

DButCooler

DButReboiler

36

30

LowPressureVent

32

33

E-104 18

Air Cooler1

MIX-108

SalesCondensate

Inlet Gas

Temperature

Pressure

Molar Flow

10.06

5000

35.02

C

kPag

MMSCFD

Inlet HC

Temperature

Pressure

Phase Liq Vol Flow @Std Cond (Liquid Phase)

Phase Liq Vol Flow @Std Cond (Aqueous Phase)

10.00

2500

2500

2500

C

kPag

barrel/day

barrel/day

Sales Gas

Temperature

Pressure

Molar Flow

21.00

7419

30.78

C

kPag

MMSCFD

E-102

AirCooler2

Sales LPG

Sales LPG

Temperature

Pressure

Liq Vol Flow @Std Cond

Vapour Fraction

37.80

1000

533

0.00

C

kPag

barrel/day

Sales Condensate

Temperature

Pressure


Vapour Fraction

38.14

0.0

3710

0.00

C

kPag

barrel/day

Produced Water

Temperature

Pressure


10.00

2500

2500

C

kPag

barrel/day

fdominguez

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