Endeavor's joint industry project delivers knockout blow for resin over cement
Endeavor Management has unveiled the results of its joint industry project on reducing decommissioning costs, and they are – for the most part – conclusive.
The project (JIP) backed the use of resin to plug wells and abandonment of infrastructure on the ocean floor. In comparing between three basic vessel types in subsea intervention and plugging and abandonment (P&A), the study was less decisive; it found that mobile drilling offshore units, which are capable of completing all tasks needed in P&A, are better value at current oil prices, but that this situation will not necessarily last.
Eleven companies participated in this phase of the JIP: supermajors ExxonMobil and Shell were the surviving participants from a previous study conducted by Endeavor, and they were joined by Total, Freeport-McMoRan, Marubeni, Stone Energy, Aker Solutions-Baker Hughes Alliance, GE Oil and Gas, Halliburton, Oceaneering and EnVen Energy Ventures. Each company paid $59,000 to participate and to access a full report of the results. Endeavor Executive Vice President Bruce Crager shared some of the findings with DecomWorld.
Crager hailed the project as proof that collaboration – a word he said has been “over-used” for years, is now being deployed to the benefit of everyone.
“ExxonMobil and Shell have deep expertise in some subjects, but even they don’t know everything and benefit from exchanging ideas,” he argued. “A Shell guy may have done things the same way for 20 years, until an ExxonMobil guy suggests another approach.”
MODU is best – but only at current rates
Plugging and abandonment is typically the most expensive component of decommissioning; it accounts for 46% of forecast North Sea decommissioning expenditure, according to Oil & Gas UK.
As such, it was no surprise that the JIP chose to compare the use of three different vessel types in subsea intervention and P&A. The three were: a light-well intervention vessel with no riser, which Crager estimates can complete 60-70% of all tasks, a vessel with a small-bore intervention riser, which can complete around 70-90% of tasks, and a mobile offshore drilling unit (MODU) with full subsea riser system, which can complete all tasks but is generally more expensive.
The study found that MODU rates have fallen to $200,000-250,000 per day from $500,000/d, making it almost as affordable as the other, typically cheaper, options. “With all their capabilities, you’d probably take the MODU option in the current market,” Crager said. “But we expect rig rates to go back up again and then there will be substantial advantages in using less expensive vessels.”
Resin wins the day
In the debate over whether to use resins instead of cement to plug wells, the JIP was more emphatic. The industry has traditionally rejected resins because they are more expensive, but the Endeavor-led study concluded that their superior performance makes the extra cost worthwhile.
“Resins are 25 or 30 times more expensive but they have ecological, technical and cost advantages if used in the right way,” Crager said. “They set faster than cement, which could save 10 hours of rig time – a valuable commodity. They are also more likely to seal for long periods. If you’re going to leave a well for an eternity and never want to have a problem again, it’s better to have something going in as a liquid that sets up as a hard plug rather than cement, which is more likely to get cracks over time that will lead to leaking.”
When the unique properties of resins are fully exploited, there are several means of saving money while still increasing sealing performance, the JIP found. But this comes with a caveat: these advantages must be designed into the well or into the decommissioning program; if done correctly, these cost advantages will occur and lifetime seal performance will increase.
This conclusion would have been of particular interest to JIP participant Oceaneering, which conducted the Gulf of Mexico’s first permitted lower abandonment using resin in March. Due to a downhole obstruction, the operator that contracted Oceaneering to do the job had determined it could not reliably carry out a lower temporary abandonment with cement.
Project confirms virtue of rigs-to-reefs policy
In response to demand from several JIP participants, the study also assessed the viability of leaving infrastructure on the ocean floor in deep waters where there is little oxygen or marine life. Seeking an unbiased view, Endeavor employed the California-based oceanographic and engineering company Coastal Environments to study the effect on waters deeper than 3,000ft (915m).
“There are a lot of microorganisms living in the soil and if you put substrate, or hard materials, on the ocean floor they are attracted to it. Then you get bigger things growing and it creates reefs over time,” Crager said.
Marine growth will occur even in 7,000ft of water, the study found. “We’re told never to leave footprints when we go camping but the sea floor is different and it might be better to leave it there,” Crager said. “The study also showed how if you disturb infrastructure it can create mud clouds that stay suspended for decades at that depth, where they hurt the environment. Unfortunately, in the developing world there tend to be restrictions on leaving infrastructure there.”
The JIP looked at several other subjects, including dealing with hazardous materials in decommissioning, and finding the best technologies for cement bond logging and subsurface cutting and milling. Endeavor plans to run a second phase of the JIP and has drawn up a list of recommended subjects. As in the phase just concluded, the participants will determine the scope of the study.
By David W. Smith