Subsea processing – has it now finally been accepted?

I have never been big on surveys – they are usually meant only to re-affirm what the client already knows or thinks they want to know. One I do rate, though, is a quite well known one done by McKinsey & Co at least 15 years ago about the uptake of technology.

To summarise, McKinsey looked at a number of industries – computers, aviation, pharmaceuticals, oil & gas and possibly one or two more. The upshot was new computer technology went from testing to the market as quick as possible, ie around six months. New aviation concepts and pharmaceuticals took quite a long time to appear due to the requirement for testing because of the direct impact, ie safety factors, on human beings. But out there by itself was oil and gas which took more than 15 years to get some technologies to market – if ever.

This mostly referred to ‘nice-to-have’ technology, not anything that would be a real gamechanger which would always involve money. There are examples, eg 4-D seismic, that got put into use much quicker, because it had a direct impact on knowledge about the reservoir, meaning ‘the bank’. So if an engineer or technologist went to his manager said if we used this we would know more about reserves and how to get them out of the ground, go for it. Pretty simple.

Quite a lot of the ‘new’ subsea technology, unfortunately, has fallen into the ‘we can do this better’ category or even come out of the ‘better mousetrap’ catalogue. And when it has been used, often it was the result of the ‘necessity is the mother of invention’ axiom. Norsk Hydro would not have put the Troll pilot subsea separation system in the water except that early production drilling revealed a higher water cut than expected and the requisite need for more water handling capacity.

It would take until Statoil deployed the Tordis subsea separation system for an operator to put its cards on the table and show that installing this equipment on the seabed would actually make money.

Subsea pumping has been used in many places to date, but mostly in first or early phase of production of new fields. And as for subsea gas compression, I expect there were many folks who thought it would never really happen, especially after Shell took over Ormen Lange from Norsk Hydro-cum-Statoil. While Shell was once seen as innovative and chance taking, it is now perceived as somewhat more conservative, ie its first move at Ormen Lange was to shelve the subsea concept and consider alternatives.

So what’s new? Lots. Shell has finally discarded its idea of onshore or platform based compression for Ormen Lange and has taken the plunge – literally – into moving forward with putting a system in the water. And the Anglo-Dutch major has its finger in another pie Down Under where it is a partner on ExxonMobil’s Io-Jansz complex which is part of Chevron’s Greater Gorgon development.

This will make the subsea systems developers – in this case Aker Solutions for the Down Under work and either TechnipFMC or OneSubsea in Norway – very happy. So much time and money has been spent on developing systems and equipment and now that effort will finally bear fruit.

In some ways, though, another project offers a less sophisticated solution, but with more potential. TAQA’s Otter field is to get seabed pumps to replace the unreliable electric submersible pumps which have been there for since development. This will be, I believe, the first brownfield installation of seabed pumps in UK waters and possibly offers a model for many other fields which could contribute to making the Maximum Economic Recovery (MER) drive a reality for the Oil & Gas Authority and many operators in and around the North Sea.

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Re Blog No 1: Here is an amusing note: The Staffa field, mentioned in my first missive on flow assurance, has been renamed Mansell by its interestingly named new operator, Decipher. If the newbies can figure out how to make the reportedly less than 10mmbbls of oil in place profitable, they should get some award.