Challenges and opportunities in deeper waters


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Standardization is key to achieving more cost effective subsea solutions in the future, panelists conclude during NBCC subsea event.

From the left: Mr. Juan Arango, Mr. André Leite, Mr. Luiz Costamilan, Mr. Victor Bomfim and Mr. Fabio Pereira.From the left: Mr. Juan Arango, Mr. André Leite, Mr. Luiz Costamilan, Mr. Victor Bomfim and Mr. Fabio Pereira.Challenges and opportunities in deeper waters was the topic of a NBCC event on March 2, 2015, at the Associação Comercial do Rio de Janeiro (ACRJ). The event was the first in a series of panel debates, covering different aspects of the oil & gas industry that NBCC intends to organize this year.

Several high profiled speakers shared their views on the topic, and the debate was moderated by Mr. Luiz Costamilan, an independent consultant who offers advise to companies in the energy sector, with many years of experience from BG Group and Petrobras.

Achieving more cost effective subsea solution must be an ambition to the sector, and standardization is key, according to the panelists.

«We need to figure out how the industry can face the current scenario and adapt to this new reality. The oil price has fallen 60 percent in six months, and I predict an oil price of about 60-80 USD a barrel in the years to come. Technological advances will contribute to lowering costs, but price recovery will take time», Mr. Costamilan said in his opening remarks to the event. He was actually responsible for the very first Christmas tree that Petrobras installed at the Enchova field, and subsea activities was «like science fiction» when he started out. Today it is reality.

A joint effort
«Standardization of requirements and design is key in the current scenario», Ms. Sonja Hauge of Aker Solutions argued in her address to the panel. Aker Solutions recently teamed up with Baker Hughes in a partnership where focus is on developing innovative solutions for subsea production.

From the left: Mr. Luiz Costamilan, Mr. Victor Bomfim and Mr. Halvard Idland.From the left: Mr. Luiz Costamilan, Mr. Victor Bomfim and Mr. Halvard Idland.«Innovative technology must lead to more cost-effective solutions and we need the operators´ help in streamlining it. I believe this is a joint effort, where the industry needs to work together. There are still plenty of room for improvement, and Aker Solutions wants to provide a subsea processing package to the market, and believe we can take this opportunity to develop the next generation cost-effective solution», she said. Ms. Hauge also believes that separation systems are the most immature part of the subsea system at the moment. This system is still very tailor-made.

«Integration and simplification are other key words to increased and enhanced recovery and improved performance. Aker Solutions are also looking into the next generation work-over systems, vertical trees, the next generation control systems and power systems. Our vision is that the seabed is the new surface», she said.

According to Victor Bomfim, senior VP of Subsea7 in Brazil, his company has identified five main technology drives in its activities, and these are riser systems, flow line systems, bundles, subsea procession and life of field and remote intervention. Subsea7 has more than 2000 employees, seven vessels and about 500 ROVs operating in Brazil.

«I am optimistic. In the current scenario, the industry needs to develop better solutions. It is a question of survival. At the same time we need to be careful and not stare us blind on believing that standardization is always the way to go. We also need to take operational, installment and maintenance costs into consideration, in order to stay ahead of the game. The subsea equipment itself might not be the cheapest, but in the long run, it will pay off», he said.

Mr. Bomfim also reminded the panel that new scenarios ahead, with deeper waters, harsher environments, a higher output flow from large producers mainly in the pre salt fields and larger volumes of gas or water to be managed will drive the need for technological advances, particularly within subsea processing and boosting, flow assurance, high strength materials and larger diameter conducts.

The audience showed concern that the focus on standardization will kill competition by leading companies to choosing certain suppliers or technologies even though tailor-made –  and not standardized – solutions might be the better choice.

«There is no size that fits all», Mr. Juan Arango, president of OneSubsea do Brasil, a new company created by Cameron and Schlumberger, said in his address to the panel.

«We have been discussing standardization since the mid 1990-s. In Brazil there are hundreds of different models of equipment installed. We are a service company, and the problem is the need for modification on already installed equipment. At the end of the day, everyone wants their own toys and there are certain details that are not shared. But there has been progress in terms of standardization», he said.

Mr. Arango focused on the need for an integrated approach and more advanced control systems, and sees the ability to access subsea installations at a lower cost as fundamental when distances increase. He also talked about other initiatives that could reduce costs.

«Cost increases due to deeper waters, and lighter equipment could reduce costs, but this needs to be driven by the customer. Horizontal trees could reduce installation time», he said.

Mr. André Leite and Mr. Luiz Costamilan.Mr. André Leite and Mr. Luiz Costamilan. Innovative ambitions
Mr. André Leite, the VP of field development in Statoil, was the only representative from an operator, and he shared Statoil´s view on subsea developments.

«Scarcity drives teamwork and efficiency. This is something we can learn from the current situation. Statoil is preparing for the situation, with an oil price in the range of 50-60 USD a barrel, to endure. We cannot control the price, but we can work to simplify and increase efficiency in our activities. When we talk about subsea, the increasing complexity in deeper waters leads to increasing costs, and I believe standardization is a key word to future success. It has become a question of survival, and it is time to sit down and take it seriously», Mr. Leite said in the debate.

Statoil has a comprehensive subsea history and the only company in the world with more subsea wells is Petrobras. Almost 50 percent of Statoil´s production comes from subsea development, and the company is operator for more than 500 subsea wells in the North Sea. The current ambition is to realize subsea compression during 2015 and launch the subsea factory by 2020.

According to Mr Leite, the environment for innovation is Brazil is favored by the ANP clause on R&D investments.
«From the Statoil point of view, partnership with the supplier industry is key to lowering costs», Mr. Leite said.

The panel also stressed that it took years to develop the current Norsok and API standards, and the discussion of standardization in Brazil – and in the subsea industry – is still a question of maturing the ideas.

«We cannot let standardization be a hinder to the development of new technology, and need to keep an open mind towards research and development», Mr. Fabio Pereira, the VP for business development of Aker Solutions, said

By Runa Hestmann, NBCC journalist