eni corporate university scuola mattei scuola enrico mattei master medea year 2003-2004 san donato...
TRANSCRIPT
Eni Corporate University Scuola Mattei
Scuola Enrico MatteiMaster Medea year 2003-2004
San Donato Milanese, 28th June 2004
Alessandro Di Nisio
Marco Gazzola
Jeremias Guitarte
Cristian Masini
Marina Muratore
Mariangela PernaTutors:
Domenico Di Renzo
Alberto Marsala
Giorgio Vicini
Expandable Technologies –Economic evaluation of the
installations
Students:
Eni Corporate University Scuola Mattei
Agenda
• Technological introduction• Reference scenario• Case A – Expandable Technologies: dual zone
application• Case B – Expandable Screen in horizontal well• Case C – Expandable Casing• Conclusions
• Technological introduction• Reference scenario• Case A – Expandable Technologies: dual zone
application• Case B – Expandable Screen in horizontal well• Case C – Expandable Casing
Eni Corporate University Scuola Mattei
SOLID CASING EXPANSION
• Cased hole remediation system for casing repair, perforation shut-off, corroded casing, …...
• Blank pipes coupled with expandable screens
Eni Corporate University Scuola Mattei
• Cased hole remediation system for casing repair, perforation shut-off, corroded casing, …...
• Blank pipes coupled with expandable screens
SOLID CASING EXPANSION
Eni Corporate University Scuola Mattei
• Cased hole remediation system for casing repair, perforation shut-off, corroded casing, …...
• Blank pipes coupled with expandable screens
SOLID CASING EXPANSION
Eni Corporate University Scuola Mattei
Cou
rtesy
: W
eath
erf
ord
Slotted base pipeCou
rtesy
: B
ake
r
Perforatedbase pipe
Expandable screens provide:
• Effective sand control
• Formation support (eliminate/reduce annulus)
• Larger ID for easier well intervention access
• Enables accurate production logging
EXPANDABLE SCREENS TECHNOLOGY
• Effective sand control
• Formation support (eliminate/reduce annulus)
• Larger ID for easier well intervention access
Eni Corporate University Scuola Mattei
SCENARIOS’ HYPOTHESIS
Inflation rate 2,5%
WACC 8,1%
Income Tax 36%
Royalties 8%
R&D Investments (K€) 570
Depletion rate 10% 12% 12%(+1%/a)
Gas price ($/MMBTU) 1,5 1,25 1
Oil price ($/bbl) 24 21 18
Exchange rate €/$ 1,05 1,17 1,25
Eni Corporate University Scuola Mattei
Case A – Expandable Technologies in dual zone application
• Insufficient gravel quantity
• Abandonment of main well and side-tracking
• Expandable Technologies as alternative to Gravel PackCASE A: ADDITIONAL HYPOTHESIS
Production (Sm3/g) 670.000
Productivity increase 20%
Workover cost (K$) 1.250
Probability of shorter longevity(need for a workover on 10th year)
20%
Operating costs ($/boe) 2,2
Eni Corporate University Scuola Mattei
Case A – Economic Evaluations
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013-200
0
200
400
600
800
1.000
1.200
1.400D
iffe
ren
tial
Cas
h F
low
s (K
€)
Case A - Differential Cash Flows
Best Case Normal case Best CaseWorst Case
Normal case
NPV @ 10 anni 3.800.000 €
Eni Corporate University Scuola Mattei
• Horizontal well with OHGP• Bad event: swelling shales• Side-tracking with expandable screen
CASE B: ADDITIONAL HYPOTHESIS Production (bbl/g) 6.000
Productivity increase 10%
Workover costs (K$) 1.250
Probability of shorter longevity(need for a workover on 10th year)
20%
Operating costs ($/bbl) 3,5
Case B – Expandable Screen in horizontal well
Intervention costs (K$) 1.700
Probability of swelling shales actually occuring 25% 33% 50%
Eni Corporate University Scuola Mattei
Case B – Economic Evaluations
2004 2005 2006 2007 2008 2009 2010 2011 2012 20130
500
1.000
1.500
2.000
2.500
3.000D
iffe
ren
tial
Cas
h F
low
s (K
€)
Case B - Differential Cash Flows
Worst Case Normal Case Best Case
Normal case
NPV @ 10 anni 9.500.000 €
Eni Corporate University Scuola Mattei
Case C – Solid Casing Expansion
• Need for insulating the upper interval (cladding)
• No production increase
• Unique differential Cash flow is cost saving of 850,000$
• Need for insulating the upper interval (cladding)
• No production increase
Eni Corporate University Scuola Mattei
Adoption of Expandable Technologies at 10 years
Development E.T. total
0
10
20
30
40
50
60
70
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Dev
elo
pm
ent
E.T
. to
tali
Tipe A Tipe B Tipe C Tot ENI
Development E.T. per year
0
1
2
3
4
5
6
7
8
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Dev
elo
pm
ent
E.T
. per
yea
r
Tipe A Tipe B Tipe C Tot ENI
Eni Corporate University Scuola Mattei
Synthesys within Eni group
2004 2005 2006 2007 2008 2009 2010 2011 2012 20130
10.000
20.000
30.000
40.000
50.000
60.000
Dif
fere
nti
al C
ash
Flo
ws
(K€)
ENI tot - Differential Cash Flows
Worst Case Normal Case Best Case
Normal case
NPV 10 years 163.300.000 €
Eni Corporate University Scuola Mattei
Synthesys within Eni group
Normal case: NPV 10 years
After taxes 163.300.000 €
No taxes 277.000.000 €
This conclusion might be conservative.
A major E&P company announced a double value creation (320 M€) with almost the same number of installations
Eni Corporate University Scuola Mattei
Conclusions
Main features of Expandable Technologies:• Increase in production due to larger ID downhole• Cost savings in comparison with alternative solutions• Though, need to confirm technology’s longevity• Anyway, Expandables are already considered a
breakthrough technology• The most ambitious application – in drilling – is the
development of the monodiameter well-bore
• Increase in production due to larger ID downhole• Cost savings in comparison with alternative solutions• Though, need to confirm technology’s longevity• Anyway, Expandables are already considered a
breakthrough technology
Eni Corporate University Scuola Mattei
Thank you
for your attention