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December 19, 2007
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Home / Issue Archive / 2006 / November #11 / SPE's Event Underscores Russia's LeadingRole in Energy

№ 11 (November 2006)

SPE's Event Underscores Russia's LeadingRole in Energy

The scale of events carried out in the Russian oil industry is no wonder today. However, over 200 international specialists working in the sphere of oil and gas exploration, production and refining came together and presented more than 130 reports (including poster sessions) to the Society of Petroleum Engineers (SPE) for the first time.

By Elena Zhuk

"Such an event could hardly take place some five years ago. Today everyone understands that all the countries of the world will be integrated into a single energy system in the future," said Chairman of the Executive Committee of 2006 SPE Russian Oil and Gas Technical Conference and Exhibition at the first plenary session. The event took place on October 3-7 at Crocus Expo, 66 km from the Moscow Ring Road.

On the first day of the confrerence, contributors of the plenary session demonstrated specific interest in the Russian oil and gas on the part of leading foreign companies.

ConocoPhilips, the third largest company in the US, works with LUKOIL and Rosneft on a joint venture basis.

The Polar Lights, a JV of Rosneft and ConocoPhilips (50 percent each) produced over 1,276,000 tons of oil in 2005 while developing oil fields of the Ardalinskaya Group and the adjacent territory in Yamalo-Nenets Autonomous District. A JV of LUKOIL and ConocoPhilips (70 and 30 percent respectively) also operates in the Timano-Pechora gas-bearing province.

In turn, Rosneft associates long-term oil production prospects with development of hydrocarbon reserves in Eastern Siberia and the offshore area of the Russian Far East. The most high-tech project in Russia is the development of Vankorskoye field in Eastern Siberia. The field is characterized by high nonuniformity of the reservoir, gas caps, permafrost formation, severe climatic conditions, and remoteness from infrastructure facilities. New well survey technologies, such as nuclear magnetic logging, element-by-element spectral gamma-ray logging, and cable tester, have first been used at Vankorskoye field. Presently, the entire field area is covered by 3D seismic survey, that allows developing more accurate petrophysical, geological, and hydrodynamic models of the field. Horizontal drilling, application of intelligent downhole systems, reinjection to the reservoir are basic solutions developed during the Vankorskoye field design, that have resulted in significant improvement of the key project indices. Commercial development of the field will begin in 2008.

There is always space for western companies to get involved, even if Russian companies remain as subsoil users, such as Gazprom in case of the Stockman Project. Modern technologies and technical solutions, for LNG production likewise, will be applied for development of this giant gas condensate field in the Barents Sea, and competent international companies will be engaged in implementing them. According to Halliburton, such companies hold over 15 percent of the Russian service market. In the nearest decade, Halliburton will bet on developing technologies to improve oil recovery, production of alternative resources in the severe Arctic environment, and methane in coal seams, developing oil bearing sands, low permeability reservoirs, as well as shale reservoirs. David King, the executive vice-president of global operations, has named a few priorities in technology development including well rig modification, bit design improvement, reservoir productivity increase, data management development, cementing technologies, interval hydraulic fracturing, hydraulic fracturing in horizontal wells, acid treatment, and well workover technologies.
Widely applied by Schlumberger, hydraulic fracturing technology contributed to a significant increase in oil production in Western Siberia. Schlumberger conducted over 1,000 hydraulic fracturing operations, and constructed over 100 horizontal wells for Gazpromneft (Sibneft) alone. In February 2006, Schlumberger commissioned its plant for manufacturing REDA bottom-hole pumps in the Tyumen region, and now plans to construct the Novosibirsk Technology Center by the beginning of next year.

Hydrocarbon transportation is one of the essential elements of the Russian oil and gas industry. Speaking on behalf of Transneft, the only Russian operator transporting oil to the CIS and the neighboring foreign countries, Yuri Lisin, the company's vice-president, stated that in the last five years, over 40 pumping stations were renovated and commissioned, and over 4,000 km of pipelines repaired. This issue was quite urgent, as equipment commissioned over 30 years ago had not been repaired ever since. In 2001, Transneft built pipelines and a special oil seaport in Primorsk, which is one of the safest and largest ports in Russia, and can compete with Latvian Ventspils in terms of rates, convenient geographic location, and deep water availability.

Unique Fields Make the Day

Renat Muslimov, Tatarstan's presidential adviser on oil, gas, and subsoil use affairs, has referred to the conference as a "pleasant exception to the rules, an event devoted not only to traditional production, refining, and transportation, but to unique fields as well."

Muslimov mentioned that such fields as Romashkinskoye require a lot of time for surveying - reappraisal of their reserves is kind of a permanent process, and their development will take centuries. Some 500 local oil bearing horizons are to be discovered in the nearest 50 years. When answering a question on Improving Reservoir Recovery (IRR) technologies applied at the Romashkinskoye field, Muslimov said that today, over 240 various IRR technologies are used, of which 95 percent are physical and chemical methods. The most promising technologies include flow baffling, steam injection, in-situ combustion, wave technologies, drilling horizontal wells, downhole splitters, and new holes, hydraulic fracturing, and microbiological methods. As a result, oil recovery has increased from 0.528 to 0.6.

The problems in the development of Romashkinskoye field in Tatarstan are similar to those of Samotlorskoye field, located in the marsh land near Nizhnevartovsk, Western Siberia. The third largest of the discovered fields with light oil and proven reserves of 3.66 bln bbl is operated by 'N_-'_. TNK-BP began operating the field several years ago, and faced a serious problem of production decline in the late 1990s. To stabilize production, efforts should be concentrated on developing low productive reserves, such as the Ryabchik reservoir that contains about 30 percent of residual low productive reserves. It is also advisable to conduct hydraulic fracturing and flooding, and to drill new wells.

The Astrakhanskoye gas condensate field, located in the Volga delta, is different from other giant fields due to high acid component content (up to 50 percent), and abnormal thermobaric pressure (Abnormally High Formation Pressure). There are no other fields in the world with hydrocarbon accumulations located over 4,000 m deep, in the conditions of similar high formation pressure. In the Soviet times, this field was developed to produce gaseous sulfur. One of the main development problems is finding solutions that will allow to reduce hazardous substances releases into the atmosphere. In order to improve development efficiency, special attention is paid to increased well workover scope and efficiency, abandonment operations, construction of new wells to replace the abandoned ones, and to issues of water ingress and water cut. However, the problem of increasing water cut is yet to be solved.

Pat McGuire, BP's chief adviser, spoke of the development of Prudhoe Bay field, located in North America, 250 miles from the Polar Circle. Development of this filed is complicated by a gas cap which is as large as the hydrocarbon reserves. Unique flooding (including increased oil recovery due to gas injection in the mixing mode), and grav ity drainage technologies have been widely applied for development of this field.

The Prudhoe Bay field has been tapped over 2,500 times. From 1989 to 2004, technologies, such as hydraulic fracturing, horizontal rotary drilling, and coiled tubing drilling were effectively used there. Sidetracking with application of the sixth generation coiled tubing assemblies prevailed over other drilling methods applied at the field, for it is 30 percent more cost effective, compared to the rotor drilling method.

Descending from the Pyramid Vertex

During the third plenary session on Thursday, scientists discussed significant achievements in the industry over the last 20 years, and outlined development prospects. Oleg Angelopulo, a Drilling Department professor at the Russian State Oil and Gas University named after I. M. Gubkin, talked about the successes achieved in drilling, and mentioned the successful development of Western Siberia fields thanks to the rapid drilling technology, and wider application of well recovery by means of sidetracking, especially using coiled tubing assemblies. Horizontal drilling technology is now coming back to Russia triumphantly, after being widely applied in the West. First successfully applied with a home-produced turbodrill in Bashkiriya, in Ishimbaineft oil-and-gas production department, by Alexander Grigoryan, a Soviet engineer, this technology resulted in an increase of daily production rate by 17 times, while the cost of drilling went up by 1.5 times. Angelopulo underlined the need for developing offshore drilling and qualified shelf reserves as a stabilization fund of the oil and gas industry. In conclusion he said: "Recently, exchange of ideas and skills takes place to the mutual benefit of all the parties involved; and home and foreign equipment neighbor on rig sites."

Christine Economides, Professor of the Texas A&M University, described the development of 3D seismic survey, drilling of horizontal wells, and development of unique fracture design as the most important technology trends. See for yourself: in 1991-1993, only 7 percent of wells were drilled using 3D seismic survey data; in 1994-1997 - already 64 percent; 23.5 percent of Gazpromneft's production falls to horizontal wells that make up 2.4 percent of the total number of number. According to Economides, careful attention should be paid to developing gas hydrates, heavy oils, coal reserves, and application of biofuels. Selecting a gas transportation method is also a difficult task: what is more preferable - LNG, CNG, or GTL? Economides illustrated a famous "reserves pyramid conception" to visualize that large reserves are waiting for mankind at the bottom of the pyramid in alternative reservoirs, and developing these reserves will require the best technologies and an increased production cost.

Professor Alan Greengarten, the Director of the Oil and Gas Research Center at the London Imperial College, identified an important issue for the industry that was well recognized in the audience. According to his forecast, in the next five to ten years, the industry will face a shortage of experience, largely due to a qualified specialist drain from the oil industry that took place in the late 1990s due to an industry crisis and decrease in the oil prices. This problem may not be solved without establishing connections between the industry and universities, and an analysis of products and quantities in demand. Much depends on the universities' ability to adjust, their unification, and their ability to provide a staged training of specialists and staff qualification. "The industry should provide universities with as much data for analysis as possible", the moderator of the plenary session, Department Head of Texas A&M University, Professor Stephen Holditch, added. Commenting on Greengarten's speech, Professor Graifer mentioned that "the boards of trustees, established at almost all oil and gas universities in Russia, include companies' representatives, who are responsible for arranging grants and practical training, and assist in solving other problems." Igor Gutman, Professor of the Russian State Oil and Gas University named after Gubkin, added that university students and candidates for masters degrees are given an opportunity for defending a thesis at the Central Design Commission and the State Committee for Reserves.

In the course of the discussion, it was proposed to create a model of a global education network. "Debates tend to lean toward personnel and specialists training, and experience transfer. Speaking of science, we need to speak of youth. Along with conferences for experienced specialists, it is necessary to arrange conferences and contests for the youth and to award the winners," the moderator of the plenary session, Director of Oil and Gas Research Institute of the Russian Academy of Science, Anatoly Dmitrievsky, summarized. (The importance of the issue mentioned by Anatoly Dmitrievsky was confirmed by the fact that one of such contests had already taken place during the conference - see page 38.)


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