opito petrochallenge 2010 offshore presentation
TRANSCRIPT
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Introduction to Exploration
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Purpose
You are an exploration team in charge of a new petroleum province.
Multidisciplinary challenge: Enhance your overall understanding of petroleum exploration and field development.
Create a Return on Investment
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Money/CP’s You start with $200 million Create value
Net value of the oil and gas discovered MINUS all costs involved
Credibility points awardedSensible decisions and correct answersCPs are a measure of ability and credibilityConsidered when bidding for blocksUse when applying for funds
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You will learn
Where and how to find hydrocarbons Licensing rounds Farm-in and Partnerships -
negotiations Drilling rigs Sub-contractors Environmental issues Economically viable volumes Team work, Critical decision making,
analytical skills Multi-tasking
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Oil
Gas
Oil and Gas Value Chain
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Login
www.oilsim.com
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Login
www.oilsim.com
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Main screen
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Map Columns e.g C1 to C112
Row
s e
.g. R
1 t
o R
14
4
Block
Blocks are divided into 64 smaller cellse g. R52C110
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First task
Challenge: Find three sedimentary basins
Procedure: Buy and study magnetic and gravimetric
surveys Submit the coordinates for each centre Column and row number for each basin
centre
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Gravimetric surveys
Gravimetric surveys indicate changes in the gravitational pull of the Earth in different areas of the sub-surface.
Lower gravitational fields indicates likelihood of low density rocks –Sedimentary rocks, porous and hopefully containing hydrocarbons
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Surveys in OilsimSurvey shop
Gravimetric survey of North-west area
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Magnetic surveys
Magnetic surveys show anomalies in in the expected magnetic field of the Earth in particular areas.
Sedimentary rocks in the basins have a lower concentration of magnetic materials and lower magnetic field than the surrounding crystalline rocks.
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Survey in OilSim
Magnetic survey:North-west quadrant
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Survey in OilSim
All four quadrant surveys in map context
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Finding the Midpoint
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Survey analysis
Locate edges of the continous basin structure
Locate the diagonals and thus basin centre
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Centre may not be the same
Example:Top basin on
both maps Calculate the
midpoint between the gravimetric and magnetic centres found
= C55 and R105
C50
R100
C60
R110
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Centre Midpoint calculation
3 centres – one Centre midpoint for each basin
Example: C55, R105 Solve before deadline. All
submissions are evaluated after the deadline (and not before).
You may get 0-100 CPs. All three centres must be located to get full credibility points.
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Task 1 solved
Message in Inbox:
Shows results Answers
submitted CPs awarded
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Task 2 license round The government has
decided to put the blocks in one of the basins on offer.
Challenge: Identify the 3 most promising blocks and offer an amount for each of them.
Licensing area
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Task 2 license round Any restrictions involved? - Spawning
grounds
What are we looking for? - Prospects
Where do we find prospects? In basins, where hydrocarbons have
been 1) are produced and 2) trapped
How do I find them? - Geoscientific analysis 2D seismic, Common Risk Segment
maps
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Source and migration
1. SOURCE ROCKwhere organic material is put under sufficient pressure
2. MIGRATION ROCKwhere hydrocarbons are driven through
3. CAP ROCKImpermeable rock that stops migration of hydrocarbons 4.
PROSPECT
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Traps
(c) OLFAnticline trap
Fault trap
Stratigraphic trap
Salt dome trap
Geological “pockets”, that might contain hydrocarbons.
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Red areasYou will not be awarded blocks that contain any red spots (spawning grounds)Blue areasBlocks in area may be awarded
Environmentally Sensitive areas
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Common Risk Segment
Layer 3 Eocene1500m below the seabed
Layer 2 Paleocene2500m below the seabed
Layer 1 Cretaceous3500m below the seabed
CRS. Common Risk Segment surveys tell you about the probability of a structure in the block/cell containing oil or gas
Surface
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2D Seismic surveys
Traps can be found with seismic surveys and sound waves bouncing off structures
2D seismic survey is a vertical cross section of the geological layers along either a column or a row
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Real Seismic
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OilSim of 2DSeismic
Unprocessed Processed
Interpreted Red is top of the sealing rock
Green is top of the reservoir rock
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Order Seismic
What type of data do you want?
Columns or Rows Unprocessed or processed
data Interpreted or not
Only buy maximum of 1 block of data at a time to speed up processing
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Processing Seismic
It takes time to process your request Created to order Moves to surveys once processed
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View the Seismic
Red circles – navigate through the 2D seismic
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Anticlinal traps
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Fault traps
Leakage?
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Leakage?
Leakage?
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Cross-sections
Column
Row
Prospect, ReservoirBasin,Source
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Enter bids
Three blocks Three amounts
Min: $1M Max: $30M
You will only getawarded one block – and only pay for one
Highest bid wins If equal, then team with highest CP
wins
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Recap on Task 2
Environmentally sensitive areas – blocks to avoid
Common Risk Segment surveys – areas of higher probability of prospects
2D seismic – blocks with most structures
Final tip - Check water depth - shallow water blocks
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Task 2 solved Message sent to
all Results and CPs
One license per team
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Task 3 Exploration Drilling
The headquarters of your company has evaluated the license that you were awarded.
Although the possibility of finding oil is fair, the costs involved are large. Thus the headquarters want you to spread the risk.
Challenge: You shall farm-out minimum 20% from your license – and farm-in as much as you can in other good licenses.
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Task 3a Partnerships
Acquire 3D Seismic interpretations for the block you operate, and study the results from the licensing round
Farm-out: Get others to invest 20% or more in your license – you can send them surveys
Farm-in: Send offers to other teams to buy shares in their viable licenses. Submit an offer for each viable license, with amount offered and share wanted in whole %.
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Real 3D Seismic
Shows the subsurface structure in a cube.
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3D Seismicin OilSim
Layer 1 Cretaceous
Layer 2 Paleocene
Layer 3 Eocene
Prospects are no guarantee of oil or gas
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Partnerships
Spread the risk: e.g Investing in other blocks divides the risks amongst all partners, much more preferable than keeping 100% of one field and all the risk.
Increase probability of profit: investment in only 1 field which could be a dry prospect is possible, whereas the likelihood of investing in 5 fields which are all dry is unlikely.
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Licences
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Farm-in Either accept
the amount or % the license owner requests, or amend the amounts to your own offer
Add a message to the seller
Press “Send offer”
Minimum of $100000 per %
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Farm-in
When a team receives a Farm-In offer to appears under Financing. This is where a team can receive finance or money for a % of their own blocks
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Farm-in license OWNER
decides whether to ACCEPT or REJECT the offer
Partnerships established every time a license owner accepts an offer.
Overview: On the main page, you can see all licenses. 1) licenses you operate, 2) licenses you have invested in, and
other licenses.
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Farm-in
All your farm-in offers to other teams are shown under “Investing” on the right-hand side of the homepage . This is where a team offers investments to other teams for a % of their blocks
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Partners pay a proportional share of all future costs incurred by the partnership
Partners receive a proportional share of the net proceedings from any oil or gas found on the license.
The operator team makes all decisions regarding acquiring 3D seismics, drilling of wells and testing of wells.
Information: partners in a block can access info about drilled wells and discovered oil and gas fields.
Partnerships
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Water depth
•Before choosing a rig, you need to check your water depth
Find this at the bottom of the BLOCK page
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Choose Rig
Choose the right rigs for your water depths Jack-up rigs for shallow waters
Semi-submersible rigs for middle waters
Drillships for the deepest waters
Rig cost = drilling days * day rate
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Rigs
Few: limited number of rigs available.
If you get one: start using it within 20 minutes.
If you don’t: wait in a queue, if another team is using the rig.
Price can change: rig day rates are dynamic.
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Drilling Days
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Service ProvidersUpto 9 Star
quality- Good:
normally costs more
Bad: cheaper, but reliability
is low, so you risk extra drilling time and extra costs
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Environmental Impact Assessment
EIA survey: more credibility about the area.
Less probability for drilling problems. Less severe consequences if you run
into problems.
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Drill Position EIA:
enviromental impact analysis shows where not to drill.
Place your mouse where to drill
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Penalties & Fines
Certain problems can occur if Service Provider Selection is poor quality
Other penalties can occur if you drill in areas indicated as problematic in the Environmental Impact Assessment
As in real life, problems can occur randomly and these are also applied with fines levied accordingly.
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Drilling Position
Layer 1 Cretaceous
Layer 2 Paleocene
Layer 3 Eocene
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Estimated cost
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Drilling Result
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Drilling Result
Proven volume (MBOE) counts Test may increase proven volume Remember to tick the boxes!
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Testing
Only if you discover a field – find Oil or Gas
You decide whether you want more information about that field
More information by doing a production test (and other tests)
Tests costs: Tests take 10 days per field. Tests have the same day-rate as the drilling if you use the same providers.
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Value and ROI
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Discovered prospects
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Assumptions
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Value calcuation25% of 8 MBOE @ $50
12% $39.9M
Expected costs ifyou developed thefield (capex) andproducedthe oil (opex)
If total expenses arehigher than the salesvalue, the value of thelicense is zero
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Appraisal From Probable volume to proven
reserves
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Narrowing ranges
First well: 0 to 1572 MBOE (after drilling) 11 to 1266 MBOE (after testing)
Second well: 25 to 1033 MBOE (after drilling) 34 to 910 MBOE (after testing)
Only proven MBOE counts
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Apply For More Funds
Click on Apply for More Funds Tab. 1 CP for each $100,000 applied for. Answer the questions: All correct
gives cash and you can keep CPs. One wrong gives cash and you keep ½ of your CPs. Two wrong gives ½ cash and you lose all CPs. All wrong, you get no cash and lose all CPs.
Expensive money if less than 10 credibility points: Apply for cash and be fined $5million for each $20million requested.
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Continue...
Narrow uncertainty: Drill appraisal wells to get proven volumes
Drill into other prospects to find more proven volumes.
Farm-in and -out: Get into other good blocks.
Two additional licensing rounds: Repeat the processes.
Money: Apply for more money, if you run out of cash.