Systems Model and Offshore Oil

Offshore Oil: Decision to Recover

• The determination must be made whether cost of inputs and processing will be offset by the value of the output oil.

There are several factors that affect the profitability of oil production.

Production can not proceed unless the company has a good expectation of making a profit.

Oil Price – Cost of Production = Profit

Physical Factors Affecting Recovery

• Ocean related factors include; Ocean Depth , Ocean currents, Icebergs & Pack

ice

• Climate/weather related factors include; Wind speeds, Storms, Waves

• Oil Related factors include;  Size of the reserve, Oil quality

• Environmental protection factors;  Other resources like fish stocks, marine

mammals, and spawning grounds would be affected in the event of an oil spill.

Human Factors Affecting Recovery

Worker Safety• How safe can the drill rig and production

platform be for the workers?

Financial Factors include:• cost of inputs - building a rig to withstand

icebergs, hurricane winds, or to drill at great depths.

• cost of processes – extracting the oil, transporting the oil from off-shore to land, or maintaining equipment.

• price of oil which is set, but can change and then you determine if enough money is recovered from the oil to exceed the cost of production.

Offshore Oil: Decision to Recover

The main determinate is…… whether the cost of overcoming all other factors will be offset by the price oil can be sold for and make the venture financially viable!

A Brief History of Oil Recovery

Keeping the Connection to Land~ In the 1860’s wharves were built extending

365m out into the ocean to facilitate ocean drilling off California.

A Brief History of Oil Recovery

Letting go of Shore

~ In the 1920’s a drill rig was built on wooden pilings in lake Maracaibo, Venezuela.

A Brief History of Oil Recovery

Moving to Steel~ In the 1930’s a drill rig was built on steel

structures in the Gulf of Mexico but it was limited to 7m of water or less.

A Brief History of Oil RecoveryLetting go of the

Ocean Floor

• In 1956, the first drill ship was built allowing drilling in deeper water.

• These types of drill ships allowed exploration off the shores of Newfoundland.

Drill Ships

Off-shore Oil RigsModern Drill Rigs (Pg. 186 - Figure 11.4)

A. Submersible Rigs

B. Jack-up RigsC. Semi-

submersible Anchored rigs

D. Semi-submersible Dynamically Positioned

Submersible Rigs

Fixed columns ground them on the ocean floor!

Usually limited to ocean depths of 20 m. For this reason they are limited to continental shelves, relatively close to shore.

The rigs are floated as they are towed to drill site. Once in position ballast tanks are flooded until columns rest on ocean floor.

Submersible Rigs

Jack-Up Rigs

• Extendable legs ground them on the ocean floor.

Are limited to a maximum ocean depth of 100 m.

The jack-up is similar to the submersible in that it rests on the ocean floor.

However its steel legs (Not columns) rest on ocean floor.

Jack-Up Rigs

Semi-Submersible Anchored Rigs

• Float BUT are anchored above the drill site.

Limited to a max. ocean depth of 200 m.

Built on land, then flooded and towed to the drill site.

Water is pumped in and out of ballast tanks to keep stability along with anchor lines.

Oil is stored in pontoons until shipped on-shore.

Semi-Submersible Anchored Rigs

Semi-submersible Dynamically Positioned

Use thrusters to keep position above the drill site.

• Able to drill outside the continental shelf. Still limited to a max. ocean depth of 2000 m.

• Like other rigs they are towed to the drill site.

• Water is pumped in and out of ballast tanks to help stability (NO anchor lines).

• Like the Anchored rigs oil is stored in pontoons until shipped on-shore.

• Note: dynamic means changing or moving.

Semi-submersible Dynamically Positioned

thrusters

Semi-submersible Dynamically Positioned

Eirik Raude - The World’s largest self-propelled, semi-submersible, all weather oil drilling rig. 

Hibernia Case Study

• Pg. 187-191

Directional DrillingFigure 11.5 on page 187 of your text. This technique:

A. increases the drill holes exposure to source (porous) rock.B. allows drill companies to reduce movement from one small oil pocket to the next.