No. 4, 2007
Valery Petrakov,
Deputy Head of the Oil and Gas Production Support Division of JSC LUKOIL
LUKOIL’S OFFSHORE OPERATIONS
LUKOIL's strategic Caspian oil development program in action
Since 1995, LUKOIL has been conducting large-scale operations on five license areas in the Northern and Central Caspian. Six oil fields discovered in a Northern Caspian license area have recoverable reserves of over 300 million tons, of which the V. Filanovsky field, struck in 2005, accounts for 200 million tons.
Caspian success
Today, it is safe to say that the enormous efforts and funds the LUKOIL Group has put into developing the Northern Caspian resource base are bearing generous fruit. The prospecting works conducted in the Russian sector of the Caspian Sea in 1995-2004 revealed six large oil fields: the Khvalynskoye (2000), Yu. Korchagin (2000), 170th km (2001), Rakushechnoye (2001), Sarmatskoye (2002) and V. Filanovsky (2005). The standard of work efficiency has hit Russia's all-time high there owing to the latest processes and equipment used. For example, exploratory drilling rate amounted to over 15,000 tons of oil equivalent per meter drilled (12 times the Company's average). Development well success ratio was 100%, meaning that each reservoir was discovered at the first try. Moreover, the cost of one incremental tons of oil equivalent was a sequence lower than that of leading Western oil companies. It is noteworthy that for the first time in Russia's offshore oilfield development history several fields will have a common transport and onshore facilities infrastructure. The Khvalynskoye field is to be developed jointly with the Republic of Kazakhstan on a parity basis.
The discovery in November 2005 of a new oil and gas condensate field named after Vladimir Filanovsky was among the LUKOIL Group's major achievements in Northern Caspian resources development. At a preliminary estimate, this is one of the region's richest fields. The pioneer well produced low-density pure oil at a rate of 6,400 barrels a day, which is close to Mideastern field performance indicators but extremely rare in Russia. The new field's probable and possible reserves are estimated at 600 million barrels of oil and 34 billion m3 of natural gas. Upon field extension and project documentation approval, these reserves will be registered in the proved category.Oil production from all the newly-discovered Northern Caspian field is expected to reach its peak in 2013 and to stay at a steady 8.5 million tons a year for six subsequent years. Natural gas production is to hit a mark of 18 billion m3 a year by 2014 and to remain at that level for 15 years. According to LUKOIL estimates, total recoverable resources of the Russian sector of the Caspian stand at 4.5 billion tons of oil equivalent.
Integrated approach
LUKOIL's Caspian Offshore Field Infrastructure Development Concept provides for a systems approach to Northern Caspian field construction and development, in particular.Owing to its substantial reserves and high production rate, the V. Filanovsky field now sets the standards for Northern Caspian field infrastructure development, and wellstream collection, treatment and transportation. Under the abovementioned Concept, the bulk of Northern Caspian oil will be piped to the onshore facilities located near the CPC Komsomolskaya pump station wherefrom it will be delivered to the CPC system and the Volgograd Refinery. Natural gas will go to the Caspian gas processing plant (now in design stage) on the shore of the Republic of Kalmykia and then proceed to the Makat-Northern Caucasus gas pipeline of Gazprom.
The CDC-approved field development plan provides for maintaining a level of production of 10 million tons a year for over a decade, and for the sinking of directional and horizontal wells by two fixed ice-resistant platforms and three drilling rigs.Wellstream will be treated on two central processing platforms and transported to the Republic of Kalmykia's shore along with the output of other fields.At present, the Company is considering several wellstream conditioning and transportation options, such as bringing crude oil up to market standard offshore and dividing its treatment process into two stages - preliminary (offshore) and final (onshore) conditioning. Besides, the number and composition of hydraulic engineering structures are being optimized.Notably, the Northern Caspian features harsh metocean conditions for offshore oilfield development: sea depth is 4 to 12 meters; the sea freezes over in winter; seismicity amounts to force 7.
Therefore, offshore oil production platforms installed in the shallow waters of the Caspian must possess a high degree of ice, wind, wave and seismic resistance. The platforms' bearing members must be, above all, unified and designed in such a way as to minimize labor intensive and costly operations at sea considering that derrick barges and other such special facilities are not readily available there. The Company's specialists and subcontractors are designing practically self-contained off-shore oil production platforms the construction, operation and dismantling of which will have minimal impact on the environment. The possibility of using artificial islands is being looked into, as well.A cost-effective analysis of the abovementioned facilities has prompted an emphasis on stationary caisson-type gravity-base offshore platforms that can be tugged along on the float using a minimum of special facilities.
The upper works of platforms, made on shore, are to be installed by the float-over method using derrick barges. A slide shows a two-leg ice-resistant stationary platform for the sinking and operation of a well cluster on the V. Filanovsky oil field.
Problems and solutions
In view of the V. Filanovsky field's importance to LUKOIL, it is to be put on stream at the earliest possible date.Today, the Concept is being completed and preparations for the justification of investments are underway. Next year, we are to get down to the field construction project feasibility study, and as early as 2009, to the construction of offshore oil and gas production platforms.We are to complete the first phase of oilfield construction and start drilling wells by 2011, and put the oil field on stream in 2012. By 2014, the oil production target of 10 million tons a year is to be attained.
A sweeping-scale development of Caspian fields (the V. Filanovsky field, first and foremost) will call, owing to a great multitude and a high metal content of oilfield facilities, for a large volume of construction and assembly work, the installation of onshore infrastructure facilities, etc. As a result, about 4,000 new jobs will be created at the region's docks and other enterprises. In addition, over 3,000 top-skilled specialists will be required for manning off- and onshore fields now under construction. A third of them will work on offshore drilling and processing platforms set up on the V. Filanovsky field and operate onshore facilities.
In conclusion, it is worth noting that all operations involved in setting up V. Filanovsky and other offshore oil fields in the Caspian will be carried out on the zero discharge principle with consideration for local natural, climatic and, especially, ecological factors, such as high seismic activity in the Caspian, ice formation in the Northern Caspian in winter, and the presence of conservation areas in the Volga estuary. All these factors of utmost importance come under thorough analysis when drawing up design plans and specifications in coordination with federal and local ecological inspection authorities.
