Shell Exploration & Production
North Aleutian Basin, Alaska Energy/Fisheries Workshop Offshore Oil and Gas Development Scenarios
March 18, 2008
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Shell Exploration & Production
2006 Minerals Mgmt. Service Resource Assessment for Offshore North Aleutian Natural Gas: 8.6 trillion cubic feet Oil/Condensate: 753 million barrels Natural gas equivalent: 12.8 trillion cubic feet equivalent Mean, Risked, Conventionally Recoverable Reserves (all in Cenozoic).
Oil 33%
North Aleutian Basin ~950 OCS blocks ~5.5 million acres
Natural Gas 67%
Eastern Gulf, Florida. Senate Passed Leasing Bill August, 2006 8 3 illi 12 9 t f ti t d (1 26 bb & 5 8 t f
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Shell Exploration & Production
Exploration Process •
Disclaimer: Chance of finding commercial amounts of gas and/or oil is probably in the 10-20% range
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Acquire leases at lease sale
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Acquire seismic data over leases (optional, but 3D seismic likely preferred)
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If viable prospects are identified, acquire site specific shallow hazard surveys.
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File for drilling permit (including OSRP) & conduct environmental assessment
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Drill several exploration wells
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If gas and/or oil are discovered, appraisal wells drilled to determine the size of the find
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If sufficient volumes of gas and/or oil are found, development & production plans would be prepared – Additional environmental impact statement required for each development
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Timing: best case scenario – Exploration & Appraisal drilling from 2012-2014
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Southeast Bering Sea would only host production facilities. – Export route to be pipeline over peninsula. Shipping would occur on the southeast side of the peninsula. Page 6
Shell Exploration & Production
Timeline for 10 Exploration Wells Drilled in the St. George Basin July, 1984 – March, 1985 (9 months) Well St. George COST NAB COST Well 530 Intrepid Rat 527 Bertha Segula Fern Camelot Segula 1A Monkshood
Rig Sedco 708 Sedco 708 Big Dipper Sedco 712 Sedco 708 Big Dipper Sedco 712 Sedco 708 Ocean Odyssey Big Dipper Sedco 708 Ocean Odyssey
Jul-84
Aug-84
Sep-84
Oct-84
Nov-84
Dec-84
Jan-85
Feb-85
Mar-85
Navarin Basin - 9 wells 6/7/85-11/25/85 (6 months, 4 semi-submersible rigs) Norton Basin – 6 wells 6/19/84-8/19/84 & 7/2/85-8/24/85 (4 months, 2 jack-up rigs, 2 seasons with ice limitations) Gulf of Alaska – 11 wells 9/1/76-7/1/78 (22 months, 5 semi-submersible rigs) Lower Cook Inlet Federal – 13 wells 7/21/78-6/24/80 & 9/19/84-3/13/85 (30 months, 5 rigs (various types)
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Shell Exploration & Production
Lake & Peninsula Borough Bristol Bay Borough
Kodiak Island Port Heiden
Chigniks
Aleutians East Borough False Pass Akutan Dutch Harbor
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Shell Exploration & Production
Industry Advances Relating to Exemplary Well Blowout Track Record 1.
Shallow hazard surveys: These are mini-seismic surveys and sonar surveys required by the MMS before a drilling permit is issued. These detect shallow, high pressure, gas pockets which can cause a well to blow-out. They also detect any other obstructions on the sea floor (such as topography or ship wrecks) prior to putting a drilling rig in place.
2.
Bottom hole pressure prediction (aka pore pressure prediction): Using nearby well information and seismic data, we can predict zones of high pressure prior to drilling by using seismic velocity data. Higher pressure zones will have slower seismic velocities. Also, while we are drilling, lower resistivity zones indicate higher pressure zones. If we encounter such a zone while drilling, we can prepare to balance the weight of the drilling fluid to prevent a well blow out.
3.
Previous well data provides bottom hole pressure information (COST & onshore wells)
4.
Drilling Wells on Paper (DWOP): Process to review all well plans with multi-disciplined group prior to starting any work at the well site. Mud weights are designed for various stages of the well based on the foregoing input.
5.
Real time bottom-hole pressure sensors while drilling (aka measurement while drilling or MWD): We now monitor drilling real time with bottom hole sensors which continuously measure bottom hole pressures. Again, if abnormal conditions are detected, we can react before a well control problem arises.
6.
24 hour manned remote duplicate drilling control centers (RTOC): We no longer rely solely on the staff on the rig floor to manage the drilling operation. We have staff in Houston and Anchorage who also monitor the well bore conditions and are in constant communication with the rig floor to take any needed corrective action. Data from rig is transmitted in milliseconds to the RTOC. This process includes having well engineering expertise located at the RTOC so all issues can be dealt with immediately.
7.
MMS in Alaska has regulators on the drilling rigs to monitor activity 24 hours a day, 7 days a week.
8.
Drilling Mud: Developed benign drilling muds – formerly oil based mud, then synthetic mud, now using water based mud for exploration wells. If well pressures increase beyond expectation, then mud weight is increased to control formation pressure.
9.
Blowout preventer (BOP) advances: Standard BOP’s have 4 shut down systems in place: 1) rig floor annular seal (closes around drill pipe), 2) 3 sealing devices below the rig floor (operated from rig floor or 2 back-up locations at other platform locations) – 2 mid-rated typically 5000 psi and a 10,000 psi shear ram which will cut the drill pipe and completely seal the wellbore. In the Beaufort Sea, Shell is using BOP’s with 6 sealing devices. All BOP’s must be tested every 2 weeks.
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These technologies have been developed over the past 30 years and are a key reason for the excellent performance in recent years.
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13,500 exploration & appraisal wells drilled in the U.S. OCS since 1956 & only 4 have released oil to the ocean. Largest was 200 barrels, others were 100, 11 & 0.8 barrel spills. Never a significant exploration well blowout in the U.S.
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If there is a blowout, spill response plan in place in the theatre of operations and relief well technology can intersect an 8” wellbore from 3 miles away. Page 9
Shell Exploration & Production
Artists rendering of the topsides for an Offshore Platform which could be deployed in the North Aleutian Flare Boom Drilling Rig Equipment Crane Power Generation
Helicopter-deck Crew Quarters Equipment Packages
Process Equipment Decks
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Shell Exploration & Production Artists rendering of the Jacket for an Offshore Platform which could be deployed in the North Aleutian Basin
Water Surface
“Jacket”
Well Conductors
Sea Floor
Piling Conductors
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Shell Exploration & Production Artists rendering of the Well Spread from an Offshore Platform which could be deployed in the North Aleutian Basin
“Jacket”
Piling Conductors Sea Floor Well Casing
Impermeable Layers
Reservoir Layers
Deviated Wells
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Shell Exploration & Production
Artists rendering of the Jacket for an Offshore Platform which could be deployed in the North Aleutian Basin Surface
Topsides
Single Pier “Jacket”
Sea Floor
Ballast Chambers
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Shell Exploration & Production
Artists rendering of the Well Spread from an Offshore Platform which could be deployed in the North Aleutian Basin Single Pier “Jacket”
Ballast Chambers
Sea Floor
Impermeable Layers
Reservoir Layers
Deviated Wells Page 14
Shell Exploration & Production
Shell’s Bullwinkle Platform Gulf of Mexico
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Shell Exploration & Production Development NaKika Subsea
NaKika Daily Prod: Oil 100,000 B/D Gas 450 million CF/D
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Shell Exploration & Production
High-Resolution Multibeam Bathymetry
Ship wreck Page 17
Shell Exploration & Production
North Aleutian Liquified Natural Gas (LNG) Offshore Platforms (shallow water)
MMS Mean Resource Estimate supports 2 LNG trains for 25 years 50
0 Miles
LNG Liquefaction
Lefthand Bay export site
LNG transport to markets 2-4 tankers per month
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Shell Exploration & Production
North Aleutian – Severe Weather Comparison Cook Inlet
100 Year Data Eastern Canada North Sea Cook Inlet North Aleutian Signif wave ht-ft 41 51 30 40 Max wave ht-ft 77 94 65 75 Max wind-mph 107 110 80+ 100 Min air temp-deg F 14 19 12 12 Current-mph 5.1 2 7 4.5 Water depth-ft 92 456 62 164
Brent B – Northern North Sea
Fulmar – Central North Sea Page 19
Shell Exploration & Production
North Aleutian – LNG and Seismic Conditions Sakhalin schematic
LNG Carrier Shell LNG Facilities in Seismic Areas Location
Plant size
Trains
Start up Tankage Seismic zone
Country
Mtpa
No
year
km3
Australia Australia Oman Australia Oman Russia Japan
4.4 2.5 6.4 4.2 3.4 9.5 Storage
2 1 2 1 1 2 150+
1989 1992 2000 2004 2006 2007 73 - 03
280 0 240 0 240 200 12,000+
Mid Mid Mid Mid Mid Mid High
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Shell Exploration & Production
North Aleutian – LNG and Seismic Conditions Shell LNG Facilities in Seismic Areas Location
Plant size
Trains
Start up Tankage Seismic zone
Country
Mtpa
No
year
km3
Australia Australia Oman Australia Oman Russia Japan
4.4 2.5 6.4 4.2 3.4 9.5 Storage
2 1 2 1 1 2 150+
1989 1992 2000 2004 2006 2007 73 - 03
280 0 240 0 240 200 12,000+
Mid Mid Mid Mid Mid Mid High
LNG Tank – note seismic pads
Australia LNG Page 21
Shell Exploration & Production
Cook Inlet Liquified Natural Gas & Oil and Gas Fields
Kenai, Alaska. Built in 1969, this is the oldest LNG marine terminal in the United States and the only one built for export (to Japan). The Kenai terminal, owned by ConocoPhillips and Marathon Oil, is located in Nikiski near the Cook Inlet gas fields. Since 1969 the terminal has exported an average of approximately 34 LNG shipments each year. Kenai Pen. Borough Resolution 2000-019, Mat.-Su. Borough Resolution Serial No. 00-028 excerpt (5/2/2000), and Homer Electric Assoc., Inc. Resolution Serial No. 00-45 excerpt (7/11/2000) Whereas, the LNG Industry at Nikiski has flourished in the Cook Inlet area, with 31 years of safe, successful, and profitable transport, production and marketing of LNG; and Whereas, Kenai Peninsula Borough residents have enjoyed a long history of cooperation and benefit from our Nikiski LNG industry neighbors; … Principal tax payers in Kenai Peninsula Borough (2003): Unocal, Agrium US, ConocoPhillips, Tesoro Alaska Petro., BP Exploration Alaska, Alaska Communications, Marathon Oil, XTO Energy, Forest Oil Alaska ($1 billion tax base)
Dillon Platform: 16 miles to Kenai River Center of 14 platforms: 25 miles to Kenai River
Cook Inlet Oil & Gas Infrastructure and Field Map Map courtesy of the Alaska Department of Natural Resources, Division of Oil & Gas
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Shell Exploration & Production
Additional Benefits From Norwegian Oil Industry Assoc. Fact Sheet
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Increased safety offshore – Oil industry standby vessels improve offshore safety: » Towing capability » Improved emergency response treatment facilities » Fire fighting equipment
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Search & Rescue helicopters save lives – Permanently stationed search & rescue helicopters on some platforms – Within easy reach of important fishing fields & shipping lanes – 1/16/2003 SAR helicopter saved 11 fisherman off the Stalegg Senior which had run into a rock, 4 rescued from the water in Norway.
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Other Benefits: – Larger oil spill response capability in the region » 8400 barrel Selendang Ayu spill in Dec., 2004
– Aid to distressed fishermen or other vessels – SP70 fishing sonar developed as by-product of pipeline surveying equipment. Page 23
Shell Exploration & Production
Recent Shell Search & Rescue Stories •
Alaska Daily Operations Report – Health, Safety & Environment –
August 5, 2006 - While conducting winching practice over Lake Tuslkvoak the S-61 crew noticed a family in distress. The SAR Tech was winched to investigate and it turned out that their transportation had failed while out hunting. The S-61 landed a distance off and loaded the family of 6 onboard and flew them back to Barrow. Family was Ronald Brower Sr. and family, ages 5 to 57 years old.
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Another Successful Search and Rescue –
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Week of June 14, 2007 - Shell and the Cougar SAR Team responded to another mission in Canada near the Kulluk Operation. A young man was reported missing for more than 12 hours. The RCMP requested Shell’s assistance, and the Cougar 61 Helicopter was dispatched. The search was a success and the subject male, early 20’s, was found. Survivor is reported in good condition, and the Cougar 61 returned to Tuk Base. Estimated total flight time for this sortie is just over 1 hour.
8/15/2006 Gulf of Mexico Weekly Operations Report –
Last week, a summer squall in the Gulf of Mexico caught five fishermen off guard near the WD-143 platform. The fishermen's boat was quickly capsized and the men swam to the platform, clinging to the legs until they could reach the safety of the lower deck using the access ladder. Many thanks go to the platform personnel, Don Hamilton, Byron Miller, Jim Sprowl, Ron Lejeune, Joey Taylor, Chris Odum, Chris Barrois and Terry Bennett, for making the men comfortable, providing dry clothes, administering first aid and giving them a hot meal. Since the US Coast Guard was responding to a myriad of more serious distress calls, they were unable to pick up the stranded fishermen. The WD-143 folks secured for them a flight to shore and they flew back on the evening flight, shaken, but very much alive.
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Shell Exploration & Production
Generic LNG Plant Personnel Operators Operations Line Management Mechanical Civil Electrical Instruments Industrial Cleaning W ork Preparation & Planning Field, Office & Advisory Eng. Inspection Materials & Transport Management Economics & Scheduling Technology Laboratory Finance Computing Personnel & Training Office Services Health, Safety, Environment Security Tota l
32 3 15 5 7 6 5 1 7 2 6 4 2 3 2 3 3 4 10 3 18 141 Page 25
Shell Exploration & Production
Typical Offshore Operations Staffing Profile 2 crews on platform at all times each working 12 hour shifts. Crews will work 2 weeks straight and then have 2 weeks off. 4 crews (~90 staff) needed to man a platform continuously. Category Staff Positions Offshore Installation Manager Process Team Leader Utilities Team Leader Process Staff Associate Resource Coordinator Marine Supervisor Craft Positions Instrumentation Technician Electrician Electronic Technician Mechanic Production Operator Total
Plan (two crews) 2 2 2 2 2 2 4 4 4 6 16 46
Comments: Typically 100% of staff positions are Shell employees. Craft positions are resourced with Shell employees and up to 20% contract employees. Page 26
Shell Exploration & Production
Port Moller Bay Gas Seeps
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Shell Exploration & Production
Back-up Slides
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