No. 2, 2010
Olga Romanovskaya, Cand. Sc.
SHELF DEVELOPMENT COMPLEXITY
The environmental factor features prominently in the offshore operations of Russia’s oil and gas companies
One of the strategic goals for the Russian oil business underlined by the Energy Strategy of Russia for the period up to 2030 is: "Formation and development of major new oil production centers, above all in the eastern parts of Russia and on the shelf of the Arctic and Far Eastern seas". For this reason, the problem of ensuring reliable and effective functioning of the mechanism for protection of the environment on the continental shelf of the Russian Federation is become increasingly pressing in connection with the substantial structural and territorial shift forecast for the near future in the operations of the Russian oil and gas complex.
Technogenic problems of offshore field development
The area of the Russian continental shelf today exceeds 6.2 million km2, of which 4 million km2 are prospective oil and gas areas. Initial recoverable hydrocarbon resources are estimated by the experts of Ministry for Natural Resources of the Russian Federation at 136 billion tons of oil equivalent. This constitutes 20-25% of total global hydrocarbon resources. In addition, under the UN Convention on the Law of the Sea, Russia may secure the right to a continental shelf area of about 1.2 million km2 in the Artic Ocean, beyond its 200-mile zone, holding over 4.6 billion tons of oil.
So far, more than ten major oil and gas reservoirs have been discovered on Russia's shelf and preliminary surveys made of seven big oil- and gas-bearing regions (the Northern Sakhalin, Pechoromorsk, Eastern Barents, South Kara, Ob-Tazov, Northern Caspian and Middle Caspian regions) and the comparatively small Kaliningrad area, and 36 oil and gas fields have been discovered, including four unique ones and 14 major ones.
Already by the end of 2025 Russian oil production will shift substantially from onshore fields to the continental shelf and this, in turn, will inevitably entail a sharp increase in the technogenic impact on the vulnerable marine environment. Moreover, the environmental consequences of the oil and gas complex facilities' impact on the natural marine environment are diverse in character. There is the physical impact on the seabed structures and formations caused by drilling operations, drilling and field facilities construction, the laying of pipelines, and there is chronic pollution by drilling muds, acids and many other chemicals. Enhanced environmental hazard facilities are floating drilling platforms and other underwater and above-water production structures. Practice shows that there occur hydrogen sulphide leaks, hydrocarbon emissions, destructive deformations of the sea bottom pay bed, and even fires. Slurry, drilling mud, toxic substances, and diffuse hydrocarbons actively spread over large areas, thereby polluting the environment and poisoning all life. The consequences of major offshore oil spills, especially in shelf zones, may also be very serious.
On the eve of the launch of large-scale development of the hydrocarbon resources of the continental shelf, the Russian oil and gas companies are, therefore, facing a pressing need for maximum, full-scale protection of the environment, by relying heavily on available best practices of natural marine resources conservation and sustainable use based on introduction of effective nature-protection technologies.
Government focus on continental shelf ecology
The current prospects for expanding oil and natural gas production in Russia are thus directly dependent on the scale and degree of development of offshore fields of hydrocarbons, the environment of which is particularly sensitive to technogenic impact.
Such a situation with respect to the ecology of adjacent marine areas cannot but constitute cause for alarm for the Russian Government. For the purpose of successfully preparing for the launch of intensive development of offshore hydrocarbon resources, the Ministry for Natural Resources of the Russian Federation, in conjunction with other interested departments, has drawn up a draft Strategy for Exploration and Development of the Oil and Gas Potential of the Russian Continental Shelf. The strategic priorities in developing the offshore oil and gas complex, according to this document, include: determination of a unified government policy in the sphere of the exploration and development of the subsoil of the continental shelf of the Russian Federation; establishment of federal ownership over the subsoil and the minerals therein; justification and establishment of the international legal status of the outer bounds of the continental shelf of the Russian Federation; formation of a hydrocarbon resource base guaranteeing the energy security and stable development of the fuel and energy complex in the period of the shift in the main oil production regions after 2020; and improvement of the principles and the regulatory and legal framework for offshore natural resource use.
It should be noted that, during development of offshore fields, the oil and gas sector of Russia will inevitably come up against much greater engineering and economic problems than on the land. Alongside such risks as the uncertain market price for oil and gas, errors in assessing the characteristics of reserves and production costs, likely events of a political and macroeconomic nature, Russian companies also have to take into consideration the high probability of causing damage to the environment. At the same time, account also has to be taken of the fact that the field development risks are greater on the Russian shelf than in other parts of the World Ocean owing to the exceptionally difficult natural and climatic conditions and the need for using unique equipment and technologies. This is why one of the vital components of the draft Strategy is the section on environmental protection. Minister for Natural Resources Yuri Trutnev has noted in particular: "Account must also be taken of the stringent environmental requirements on development of oil and gas fields in the open sea, where any accident might have a most detrimental effect on the entire ecosystem."
LUKOIL's Caspian projects
It should be noted that there are already positive examples of work by oil and gas companies on the Russian shelf in minimizing the technogenic impact on the environment.
The operations of all the subdivisions of LUKOIL are now subordinated to undeviating and consistent fulfillment of the provisions of the Company's HSE policies in the 21st century, which were approved in March of 2009. Its provisions are specified in more detail in the Program for Environmental Safety of the LUKOIL Group of Companies for 2009-2013. Positive examples of implementation of this program in relation to development of oil and gas fields on the Russian shelf of the Caspian and Baltic seas confirm that the Company's management has chosen the right course.
In the Caspian region, for instance, LUKOIL has, in recent years, been precisely and consistently pursuing its multifaceted, well-thought-out environmental protection activities in full awareness of the enormous responsibility it bears for preserving this unique natural creation.
In order to ensure environmental safety in the Caspian region, LUKOIL has established a regime of nature protection priority including the following key components: undeviating observance of Russian laws and standards and international treaties in the sphere of environmental protection; assessment of the environmental impact of its operations; use of efficient zero discharge technology in its operations; development and implementation of effective nature protection and compensatory measures; and environmental monitoring.
Observations of the state of the marine environment and biological resources are carried out within the scope of production environmental monitoring over a water area far in excess of the offshore license sector allocated to the Company. Over the last ten years during which LUKOIL has been working on the Caspian, an enormous body of field data has been gathered covering virtually all components (biotic and abiotic) of the marine ecosystem. In recent years, the data of integrated environmental studies carried out by the Company are constantly being added to the Unified State Data Fund maintained by Rosgidromet.
At LUKOIL, they are convinced that the nature protection measures effectively undertaken in the Caspian region constitute a positive example of what the business community can do to prevent degradation of the Caspian environment and resolve pressing social problems. The Company's management intends to continue its nature protection efforts, which, in turn, constitute one of the key factors strengthening stability in the region.
Toward a clean Baltic
Valuable positive experience has also been gathered by LUKOIL in working under the difficult conditions of the Baltic Sea shelf.
For six years now, LUKOIL-Kaliningradmorneft has been involved in industrial development of the Kravtsovskoye oil field (D-6), located 22.5 km from the globally renowned unique natural complex called the Curonian Spit National Park, stretching along the south-eastern coast of the Baltic Sea, 5 km away from the sea border of Russia and the Lithuanian Republic.
The vulnerability of the Baltic ecosystem and the proximity of the Baltic resorts and the Curonian Spit National Park predetermined, right from the start of this field's development, that care be taken in choosing the optimum nature protection solutions and ensuring a high degree of reliability of the best world technologies applied.
LUKOIL- Kaliningradmorneft took into account all the requirements of the Russian legislation and international treaties ratified by the Russian Federation. Particular attention was focused on observing the provisions of the Convention on the Protection of the Marine Environment of the Baltic Sea Area (Helsinki, 1974/1992) and fulfilling the recommendations issued by the Baltic Marine Environment Protection Commission (also known as HELCOM or the Helsinki Commission).
Ultimately, the Company achieved all the set goals: the volume of construction work was reduced to a minimum and all possible operations involved in construction of the fixed marine platform and the offshore pipeline were performed on-shore; the volume of production processes carried out on the marine ice-resistant fixed platform was also minimized; drilling and production operations at the platform are carried out in keeping with the zero discharge principle, envisaging a complete ban on the discharge into the sea of any type of production and consumption waste, including domestic waste water; the system for removing and transporting the crude from the formation in normal operating mode is completely hermetically sealed and precludes any spills or leaks into the sea; combustion of associated gas was completely excluded from the production process.
To exercise constant monitoring of the state of the Baltic Sea and its shores and to assess the impact of its production operations on the ecosystem of the Baltic Sea, the Kaliningrad oil producing company developed a special Program for production and environmental monitoring of the infrastructure of the D-6 field, which is now being successfully implemented. Within its scope, the Company regularly carries out seasonal environmental monitoring. The environmental parameters of the Baltic Sea and its shores, including the Curonian Spit, are studied. Constant integrated satellite monitoring is performed of the south-eastern part of the Baltic under the EcoBaltic project to keep an eye on the environmental situation in the sea area.
Another convincing example of LUKOIL's fruitful activities in the sphere of protection of the environment and biological resources of the Baltic Sea was the Company's participation in construction and operation of the large-scale distribution and transshipment complex RPK-Vysotsk LUKOIL-II in the Bay of Finland. For the purpose of ensuring environmental safety on the territory of the RPK, the Company introduced a strict framework for controlling the state of marine vessels. A corporate vetting-control system is in place here with respect to the technical condition of tankers chartered for carrying petroleum products, allowing thorough inspection of the vessel to determine its conformity with the safety requirements and assess the risks of its use for carrying oil and petroleum products by sea and for performing freight operations at oil terminals.
According to the strategy developed, RPK LUKOIL-II today accepts vessels equipped with a gas recycling system, allowing petroleum products fumes to be captured during tanker loading. In order to reduce emissions of pollutants into the atmosphere from RPK facilities, a vapor capturing unit has been installed on the territory of the terminal.
One distinctive feature of the operations of the distribution-transshipment complex RPK-Vysotsk LUKOIL-II is use of zero waste processes and technology. The LUKOIL-II terminal was the first Russian facility of its type to be equipped with a software and hardware complex. The service fleet, consisting of 5 vessels, including oil skimmers and boom boats, means that any accidental spills of oil and petroleum products can be rapidly localized and eliminated. Fire-fighting facilities at the terminal include efficient systems for reservoir spraying, highly-productive foam extinguishers and a water screen at the wharves.
The leading Russian ecologists estimate that, in terms of technical equipment and environmental protection measures, RPK LUKOIL-II is among the most environmentally protected ports in Europe.
LUKOIL's effective nature protection activities on the Baltic Sea have, not surprisingly, won recognition and a high appraisal within the Russian and the international environmental community.
