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rd

Date Submitted
23rd December 2013

For official use only

MATRIC No

1310182

SURNAME

Parikh

FIRST NAME(S)

Nilay

COURSE & STAGE

MSc Oil & Gas Engineering

MODULE NUMBER & TITLE

ENM202 Facilities

ASSIGNMENT TITLE

Field Development Report

LECTURER ISSUING COURSEWORK

Mike Robinson

LATE DATE

I confirm: (a) That the work undertaken for this assignment is entirely my own and that I have
not made use of any unauthorised assistance.
(b) That the sources of all reference material have been properly acknowledged.
[NB: For information on Academic Misconduct, refer to
http://www.rgu.ac.uk/academicaffairs/assessment/page.cfm?pge=7088]

Signed

Nilay Parikh............................... Date ...23-12-2013...............................

Markers Comments

Marker

Grade

Gazelle Offshore Field Development Plan for Water

Injection

Table of Contents
1.

Executive Summary ............................................................................................. 4

2.

Introduction ............................................................................................................. 5
2.1.

Present Configuration .................................................................................. 5

2.2.

Gazelle Reservoir Formation ..................................................................... 6

2.3.

Production Forecast ...................................................................................... 6

2.4.

Environment and Legal Policies ............................................................... 6

2.5.

Other Development Activity ...................................................................... 6

3.

Assumptions ............................................................................................................ 7

4.

Development Options .......................................................................................... 8

4.1.

Option 1 ............................................................................................................ 8

4.2.

Option 2 ............................................................................................................ 8

4.3.

Option 3 ............................................................................................................ 8

5.

Flow Schemes ......................................................................................................... 9

6.

Economic Evaluation .......................................................................................... 12

7.

Flow assurance issues ....................................................................................... 17

8.

Critical Analysis .................................................................................................... 18

8.1.

Economic Analysis ....................................................................................... 18

8.2.

Platform Stability ......................................................................................... 18

8.3.

Transportation and Flow Assurance ..................................................... 18

8.4.

Decommissioning ........................................................................................ 19

8.5.

Selecting recommended option ............................................................. 19

9.

Decommissioning ................................................................................................ 20

10.

Conclusion .............................................................................................................. 22

11.

References ............................................................................................................. 23

1. Executive Summary
This report evaluates the offshore field development options for the
Gazelle field to drill water injection and disposal wells. Three options were
identified and categorised based on development cost. Development plan
was selected after considering technical and economic analysis. Report
also includes decommissioning of the recommended option.
The option selected for water injection consists of using Floating
Production Storage and Offloading for oil and water handling with the
Capital investment of $ 902 mm with a return of $ 16937 mm at the end
of 12 years.

2. Introduction
Gazelle Offshore oil field is producing oil for six years and the production
has shift off-plateau with increasing water-cut. Plan is to drill water
injection wells to shift the oil production to present plateau rate.
Development plan includes drilling of six injection and four disposal wells.
Produced Oil from Gazelle field is transported to refinery Fort Thompson
located approximated 200 km south west of the field. Plan is to re-inject
some produced water into an upper horizon within the field.
According to the present configuration all the gross production is routed
through floating storage unit (FSU) from where oil is transported to
refinery via shuttle tankers. Present field configuration was designed for
no water production and current FSU is nearing its life after three years,
thus requires re-development of the field.
From the following information, options for Gazelle offshore oil field
development plan for developing water injection and handling system is
laid out. Selection of the recommended plan is based on Capital
Expenditure (CAPEX), Operating Expenditure (OPEX) and the flow
assurance issues.
2.1.

Present Configuration

Currently there are two 50% trains each with 2 stages of 2-phase
separation on steel jacket in 100 m water depth and oil de-hydration
process depends on surge vessel to meet and tanker specifications. Oil is
metered prior to offloading.
Gas from the High Pressure separator and Low Pressure separators is
compressed and conditioned for use as fuel gas, gas from the surge
vessel plus any excess is flared. Produced water is allowed to settle in the
FSU tanks prior to overboard discharge.

2.2.

Gazelle Reservoir Formation

Gazelle field is located 45km from the nearest landfall to the North West.
Field characteristics

Gazelle Upper

Gazelle Deep

Reservoir depth
Oil water contact:
Bubble-point:
Initial Gas oil ratio:
Initial pressure:
Light, sweet crude
Expectation STOOIP

10,000 ft
10,200ft
3,800 psia
450 scf/bbl
5000 psia
360 API.
300 mmbbl

12,000 ft
12,400 ft
3,800 psia
500 scf/bbl
6100 psia
360 API
450 bbl

2.3.

Production Forecast

Gas lift and two production-wells may be required in the future to

enhance the productivity. Two injection wells may also be required.
Year
1
2
3
4
5
6
7
8
9
10
11
12

Decline
Net Oil kbpd Water Cut %
75
15
56
71.7
42
20.9
32
24.6
24
29.1
18
34.3
13
40.5
10
47.8
8
56.4
6
66.5
4
78.5
3
92.6

Water Injection
Net Oil kbpd
Water Cut %
75
15
76
14
74
16
70
18
69
21.8
70
26.4
63
31.9
57
38.6
51
46.7
46
56.5
41
68.4
37
82.7

2.4.

Environment and Legal Policies

Gazelle field is now considered for standalone in economic and fiscal

terms and no flaring of excess production gas is allowed. All the
discharges must meet minimum accepted international standards of
environmental discharge.
2.5.

Other Development Activity

Other operators have exploration license and are 50-75 km in the east of
Gazelle field. Depending upon the success of exploration wells, operators
are currently evaluating development plans.

3. Assumptions

Weather at the Gazelle field is favourable.

Subsea temperatures are moderately low.

Production wells and to be drilled injection wells are in the vicinity.

For cost estimation, inflation and royalties and are neglected.

Produced gas will be used up as fuel gas for turbines and utilities and
there is enough power generation for run the facility.

All facilities are readily available in the market and when required are
installed on the platforms.

All the legal permits are obtained for decommissioning.

Oil price will remain constant at $ 75/bbl for 12 years.

Fort Thompson has enough capacity for process increased production

All the required wells are drilled within one year and shuttle tanker is
still in use till the pipeline is laid out.

4. Development Options
4.1.

Option 1

Development plan includes refurbishment of existing FSU after 3 years.

Subsea wells will be drilled and will tie-back to FSU by subsea manifolds.
Oil and water treatment modules will be installed on FSU. Oil is exported
to Fort Thompson by shuttle Tanker. Water injection module will also be
placed on FSU and water will be injected through booster pumps.
4.2.

Option 2

Development

plan

includes

decommissioning

of

existing

FSU

and

replacing it with Jack-up platform. Platform will be constructed with 12

slots, 6 for water injection wells, 4 for disposal wells and 2 for future
production wells and the new jack-up platform will be bridged to the
existing steel jacket. Dry wells will be drilled by renting a Jack-up rig. Oil
treatment, water treatment and water injection modules will be installed
on jack-up platform. 2-Phase separator is also replaced with 3-phase
separator on steel jacket. Oil is exported to Fort Thompson by pipeline
and water will be injected through booster pumps.
4.3.

Option 3

Development

plan

includes

decommissioning

of

existing

FSU

and

replacing it with Floating Production Storage and Offloading (FPSO). FPSO

will be constructed with 12 slots, 6 for water injection wells, 4 for
disposal wells and 2 for future production wells. Subsea wells will be
drilled and will tie-back to FPSO by subsea manifolds. 2-Phase separator
will also be replaced with 3-phase separator on steel jacket. Oil
treatment, water treatment and water injection modules will be installed
on FPSO. Oil will be exported to Fort Thompson by shuttle Tanker via
Single Buoyed Mooring (SBM) and water will be injected through booster
pumps.

HP -2 Stage
Separator

STEEL JACKET

Fluids

Gas

LP -2 Stage
Separator

Booster
pumps

Hydrocyclones

Oil

Oil

Gravity
segregation
SegeSegra
Effluent

Liquid
Oil+Water

Sand cyclone and

cartridge filter

HP &
LP
comp

Figure 1 : Flow Diagram for Option 1

Oil

Gas

Fuel and Utilities

Disposal
Wells

Water
Injection

Desalter

FSU

Fort
Thompson

Shuttle

MOL
Pump

Storage

5. Flow Schemes

10

Effluent

HP -3 Stage
Separator

STEEL JACKET

Fluids

Gas

Effluent

LP -3 Stage
Separator

Booster
pumps

Effluent

Coalescer

Hydrocyclones

Oil

Oil

Oil

Disposal
Wells

Water
Injection

Desalter

Fort
Thompson

Pipeline

MOL
Pump

Storage

JACK-UP PLATFORM

Sand cyclone and

cartridge filter

HP &
LP
comp

Figure 2 : Flow Diagram for Option 2

Oil

Gas

Fuel and Utilities

11

Effluent

HP -3 Stage
Separator

STEEL JACKET

Fluids

Gas

Effluent

LP -3 Stage
Separator

Booster
pumps

Effluent

Coalescer

Hydrocyclones

Oil

Oil

Oil

Sand cyclone and

cartridge filter

HP &
LP
comp

Figure 3: Flow Diagram for Option 3

Oil

Gas

Fuel and Utilities

Disposal
Wells

Water
Injection

Desalter

FPSO

Shuttle
via SBM
Fort
Thompson

MOL
Pump

Storage

6. Economic Evaluation
Table shows the cash flows for all the options and option 2 and 3
provides the most the return on investment. Cost to drill a barrel of oil
for all the option is as follows:

Decline Base Case

cum
oil
$mm
106

cum
CAPEX
$mm
100

cum
OPEX
$mm
1036

10.71

Option 1 : Refurbish GAZELLE & FSO

266

1013

1962

11.18

Option2 : Replace GAZELLE complete

and Pipeline

266

1283

1748

11.39

Option 3 : Replace GAZELLE & FPSO

266

902

2122

11.36

$/bbl

Table 1 : Economic Evaluation

From the following cash flow it clearly states that, there would be more
return from the field if the water injection is carried out.

12

13
Table 2 : Economic Evaluation for Decline curve

14
Table 3 : Economic Evaluation for Option 1

15

Table 3 : Economic Evaluation for Option 2

16

Table 5 : Economic Evaluation for Option 3

7. Flow assurance issues

Flow assurance issues should be properly planned and addressed because
it may stop the production of oil and rectification and cleaning of pipeline
and flow-lines may be require high cost. Pigging is carried out if the
pipeline gets choked. Following table shows the possibility of flow
assurances in the Gazelle field and their likely solutions. (Brown, L. 2002)
(Pipelineandgasjournal.com. 2013)
Flow
Assurance
Problems

Hydrates

Option 1

Option 2

There are chances of

hydrate formation in
the production flowline near subsea
valves when
production is
stopped.

Option 3

Mitigations

There are
chances of
hydrate
formation
in export
pipeline

Methanol injection from

production wellhead and
heat retention in export
pipeline

Scales

Deposition of scales in the tubing,

flow-lines, water treatment and
vessel

Slugging

It can be found in the production

tubing

Sand

Sand deposition can

be found in water
injection flow line.

Apart from
the flowline, sand
can also
deposit in
export
pipeline

Corrosion

Corrosion of
production and water
injection flow-lines

It is also
found in
export
pipeline

Injecting scale inhibiting

chemicals during water
handling and
maintaining low PH.
Inhibitors are injected
from iindividual
wellheads and Water
outlet from each LP
separator
Emulsions can be
broken by heating or
demulsifying chemical
injection. Drag reducing
agent (DRA) will be
used in the oil export
lines
Sand Hydro cyclones
will be used to remove
sand content and sand
settling is avoided by
maintaining velocities
above a minimum
velocity in pipelines.
Inhibitors and Corrosion
Resistance Alloys and
they are injected at
suction of each MOL
booster pump. Cathodic
protection is also used
to protect export
pipelines

Table 6 : Flow Assurance Problems and Mitigation

17

8. Critical Analysis
8.1.

Economic Analysis

Economic analysis for each option is performed and analysis narrows

down to Option 2 and 3.

Decline Base Case

Option 1 : Refurbish
GAZELLE & FSO
Option 2 : Replace
FSU with Jack-up
Option 3 : Replace
FSU with FPSO

cum
CAPEX
($mm)
100
1013

cum
OPEX
($mm)
1036
1962

Cum Cash flow

(Revenue
CAPEX - OPEX)
6816
16725

1283

1748

16930

902

2122

16937

Table 7 : Economic analysis for all options

Option 2 has high CAPEX - low OPEX and vice versa for option 3 but both
the options will gives same return over the period of 12 years and so the
selection of the development choice will be based on the other factors.
8.2.

Platform Stability

In Option 2, Jack-up platform is to be installed will have legs lowered to

the sea beds and if the currents are faster than sand at the bottom could
wash away and would cause collapse of the platform. Moreover collapse
can also occur in the event of blowout and fire. So Jack-up platform can
possess stability issue.
On the other hand in Option 1 and Option 3, Platforms are floating
system and are less prone to subsea activities and will not possess
collapse issue as in option 1. Moreover in Floating structure, Turret and
swivel allows vessel to orient according to weathervane. This analysis
tends to be more towards floating Production System and based on
economic evaluation, Option 3 is suited.
8.3.

Transportation and Flow Assurance

In option 1, treated oil is exported by pipeline to Fort Thompson and it

may impose flow assurance problems like scale and sand deposition,
corrosion and hydrates formation.

18

In option 1 and 3, treated oil is suggested to ship via shuttle tanker

which reduces flow assurance problems found in pipeline. However any
disruption in shuttle tanker services may affect the oil production due to
oil storage problem.
8.4.

Decommissioning

Decommissioning of floating platforms in option 1 and 3 are easier due to

inherent buoyancy and mobility than compared to fixed platform which is
suggested in option 2. Moreover the decommissioning cost of floating
platform is less than fixed jacket and also the installation time of the
floating platforms would also be less than fixed platforms.
8.5.

Selecting recommended option

Evaluation the above the criteria will narrow down the selection of the
recommended option and it is shown in the below table:
Criteria

Option 1

Economic Analysis
Platform Stability
Transportation

and

Option 2

Option 3

Recommended

Recommended

Recommended

Recommended

Recommended

Recommended

Recommended

Recommended

Flow Assurance
Decommissioning

From the above evaluation Option 1 and 3 are recommended but Option
1 is ruled out from the economic point of view and moreover there would
be a lapse in production for one year, so Option 3 is recommended which
is replacing FSU with FPSO.

19

9. Decommissioning
Decommissioning of the installation would be carried out at the end of 12
years. Decommissioning of steel jacket and FPSO will be carried out
according to the following process with environmental regulations.

FPSO

SBM and FPSO would be towed to the shore and would be placed
elsewhere, since it would remain in working condition.

Well Plugging

Before the

well plugging, well tubings

and any down-hole

instruments are retrieved prior to plugging the well and residual oil
is removed by brine. [Iyalla. I, 2013]

Well plugging would be carried out by 3 cement plug.

o

Plug 1- squeezed into the producing zones

Plug 2- in the middle of the well, near a protective Casing shoe

Plug 3- the surface plug typically 250 ft. below the mud-line

Well heads and Dry Christmas tree would be removed and flow-lines will
be flushed and abandoned in-situ.

Conductor removal

After the plugging of the wells, Conductors below the mudline are
removed with the help jacks.

Topside Removal

Removal of the topside modules will be carried out in the reverse process
of the installation and it would be transported to the shore.

Steel Jacket

The steel jacket will be cut at the legs and transported to shore where it
will be refurbished or recycled. Diamond wire cutting system will be used
to cut the jacket.

Umbilical

Umbilical and control equipment would be retrieved.

20

Subsea installations

Installation

Plan

Subsea Christmas trees

The subsea trees will be removed

to reuse

Subsea wellheads

Wellheads will be left in place

Subsea manifolds.

Manifolds will be flushed with water

and abandoned in situ.

Figure 4 : Well plugging Scheme

Source:
(http://www.kosmosenergy.com/eias/Jubilee_Field_EIA_Chapter_8_23Nov09.pdf)

21

10. Conclusion
From the analysis performed, for Gazelle offshore field development
Option 3 is the best suited which gives a profit of $ 16937 mm with the
investment of $ 902 mm. So FPSO will be used to inject water for
obtaining required pressure to produce oil. Oil will be exported to Fort
Thompson by shuttle Tanker via SBM and water will be injected through
booster pumps.

22

11. References

Iyalla.

I,

2013.

Class

lectures,

ENM

202.[Lecture

notes].

Decommissioning Legislation. Facilities module, Robert Gordon

University, Energy Centre, School of Engineering, .[Accessed 18
December 2013].

Brown, L. 2002. Flow Assurance: A 3 Discipline.

http://subsites.bp.com. 2013. Azeri, Chirag & Gunashli Full Field

Development Phase 3, Offshore Platform Production. [online]
Available

at:

http://subsites.bp.com/caspian/ACG/Eng/Phase3_v2_nov_04/05%
20Ch05_0904/05%20Chapt%205%20PD%20Section%205.5%20Process_ENG
_FINAL_Oct%2004.pdf [Accessed: 19 Dec 2013].

http://www.kosmosenergy.com. 2009. DECOMMISSIONING AND

ABANDONMENT.

[online]

Available

at:

http://www.kosmosenergy.com/eias/Jubilee_Field_EIA_Chapter_8
_23Nov09.pdf [Accessed: 20 Dec 2013].

Pipelineandgasjournal.com.
Solutions

Pipeline

&

2013.
Gas

Integrated

Journal.

Flow

[online]

Assurance

Available

at:

http://www.pipelineandgasjournal.com/integrated-flow-assurancesolutions?page=show [Accessed: 19 Dec 2013].

Bibliography

Arnold, K. and Stewart, M. 2008. Surface production operations.

Amsterdam: Elsevier.

23

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