This blog posting is going to be my alternate paper which triggered from project proposal for supplying power to Electrical Submersible Pumps (ESP) in PSC Contractor B. ESP is an artificial lift to produce the oil from wells which required electrical energy due to reservoir characterization and pressure declined.
Currently the electric has been supplying by other PSC Contractor since year 2002 and the contract will be expired on year 2011.
- The current electric producer (PSC Contractor A) will need their power for oil production expansion so the contract will not be continued.
- PSC Contractor B has to find the source of power to maintain and increase the oil production.
Based on the Production Profile, the produced oil wells will deliver 5750 bopd for 12 years life time. Some alternatives have been developed as per given condition:
Development of the outcomes
The table below is showing production w/ and without EOR:
Minimum Acceptable requirements
The criteria of economic selection are:
- The Highest Net Income for Government.
- The lowest Operating cost including electrical price.
- The lowest Capital Expenditure.
Analyze and compare the alternatives
Based on the alternatives as given, we come up with the preliminary economic calculation for option1 which is the worst case scenarios:
Develop preferred alternative
BUY electric for production profile without EOR, is this worth Doing?
Estimated revenue generated as calculated is US$ 2,500 Million.The best Government Take is US$2,240 Million for12 years operation. The problem with this option there are some uncertainties that should be mitigated with EOR method such as:
- Water flood, steam flood or surfactant flood.
- Electrical supplied is assumed based on Independent Power Producer (IPP) Price.
- Is the Build Operate and Transfer method for IPP can be implemented?
Monitor and Evaluation (Post Mortem)
The next step will be evaluation of electrical supply whether developed by own self or purchase from IPP.
Performance Metrics (Lagging Indicators)
- Throughput gas volume
- Operating cost
Process Metrics (Leading Indicators)
- Spills – zero.
- Industrial Accident / LTI – zero
- Cost performance – +/- 10% of budget
- Schedule performance – +/- 10% of milestone dates.
- Peters, Max S & Timmerhaus, Klaus D. (1991), Plant Design and Economics for Chemical Engineers 4th Edition, Singapore: McGraw-Hill, Inc.
- Sullivan, William G., Wicks, Elin M. & Koelling, C. Patrick (1942), Engineering Economy 15th Edition, Singapore: Prentice Hall, Inc.