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Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production
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Kevin Mullen, INTECSEA: Subsea Developments for FLNG Production

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Professor Kevin Mullen, Subsea Engineer, INTECSEA delivered this presentation at the 2013 FLNG Forum in Perth. The two day conference brings attendees key insights into the technology and concepts …

Professor Kevin Mullen, Subsea Engineer, INTECSEA delivered this presentation at the 2013 FLNG Forum in Perth. The two day conference brings attendees key insights into the technology and concepts that will unlock Australia’s stranded gas reserves. This event brings together case studies, keynote and technical presentations from the experts at the forefront of the Floating LNG projects. For more information about the forum, please visit the event website: http://www.informa.com.au/flngforum2013

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  • 1. The FLNG Forum 2013 Delivering knowledge on the latest technologies, concepts and challenges for the FLNG revolution Subsea Developments for FLNG Production 3-4 December 2013 | Fraser Suites, Perth, Australia Prof. Kevin Mullen
  • 2. Agenda  Subsea Developments for FLNG Production  Smaller, Smarter, More Dangerous      Turning constraints of FLNG to advantage Impact of FLNG on subsea field layout New subsea technologies for FLNG Risks to FLNG from subsea developments Case study
  • 3. Smaller, Smarter, More Dangerous  Australian LNG projects, capital costs and unit costs  FLNG is small – single train  Typical fields will require several FLNG  Prelude: 3.6 – 5 MTPA LNG pa Source: BREE
  • 4. Smaller, Smarter, More Dangerous  Having FLNG close to wells is an enabler  Allows pipeline heating  Reduces dependence on chemicals  Shorter distance to wells  No need for compression or boosting  Less failure-prone equipment on the seabed  Slugs and liquid hold-up in flowlines is less of a problem
  • 5. Smaller, Smarter, More Dangerous  FLNG puts all processing equipment in close proximity  FLNG vessel exposed to inventory of risers and flowlines  Prone to escalation  Inherently dangerous, not inherently safe  An as-yet unproven technology  Potentially subject to cost blowouts  More dangerous to your bottom line  FLNG systems will suffer more downtime than onshore LNG  No linepack in long pipelines  More dependent on high availability subsea systems  More risk to your bottom line
  • 6. Constraints of FLNG  Smaller size of FLNG  Too small for the big WA fields  Browse needs 3!  FLNG entirely offshore  Needs crew offshore (Prelude needs 110 man crew)  Needs crew change/personnel transfer
  • 7. Constraints of FLNG  Smaller size of FLNG  Too small for the big WA fields  Browse needs 3!  FLNG entirely offshore  Needs crew offshore (Prelude needs 110 man crew)  Needs crew change/personnel transfer
  • 8. Turning constraints of FLNG to advantage  Smaller size of FLNG  Allows phased development of larger fields  Reduces financial exposure and initial CAPEX  FLNG entirely offshore  Reduces exposure to environmental direct action  Avoids onshore protest activity (e.g. James Price Point)  Still some risk from offshore activism  FLNG entirely offshore  Less risk of environmental approval delays or native title issues  FLNG entirely offshore  No requirement for WA Domgas
  • 9. Turning constraints of FLNG to advantage  Smaller size of FLNG  Allows phased development of larger fields  Reduces financial exposure and initial CAPEX
  • 10. Turning constraints of FLNG to advantage  Smaller size of FLNG  Allows phased development of larger fields (3 FLNG for Browse)  Reduces financial exposure and initial CAPEX Cashflow for FLNG vs onshore LNG Chart: UWA Subsea Technology 2013 Team 1
  • 11. Turning constraints of FLNG to advantage  Smaller size of FLNG  Allows phased development of larger fields (3 FLNG for Browse)  Reduces financial exposure and initial CAPEX  Going from MEGA-Project to Mini-MEGA-Project $50-60 billion exposure $13 billion exposure
  • 12. Turning constraints of FLNG to advantage  Smaller size of FLNG  Allows phased development of larger fields (3 FLNG for Browse)  Reduces financial exposure and initial CAPEX  Going from MEGA-Project to Mini-MEGA-Project $50-60 billion exposure $13 billion exposure
  • 13. Opposition to gas developments Courtesy West Australian, 29 Jul 2013
  • 14. Turning constraints of FLNG to advantage  FLNG entirely offshore     Reduces exposure to environmental direct action Still some risk from offshore activism Avoids onshore protest activity (e.g. James Price Point) Avoids protracted delays (e.g. Corrib)
  • 15. Shell Corrib timeline  FLNG entirely offshore  Reduces exposure to environmental direct action  Avoids onshore protest activity (e.g. James Price Point)  Still some risk from offshore activism  “Shell has learned, through listening, that you need to go beyond compliance to win the trust of your neighbours”
  • 16. Shell Corrib timeline  FLNG entirely offshore  Reduces exposure to environmental direct action  Avoids onshore protest activity (e.g. James Price Point)  Still some risk from offshore activism  “Shell has learned, through listening, that you need to go beyond compliance to win the trust of your neighbours”
  • 17. Shell Corrib timeline  FLNG entirely offshore  Reduces exposure to environmental direct action  Avoids onshore protest activity (e.g. James Price Point)  Still some risk from offshore activism  “Shell has learned, through listening, that you need to go beyond compliance to win the trust of your neighbours”
  • 18. Shell Corrib timeline  FLNG entirely offshore  Reduces exposure to environmental direct action  Avoids onshore protest activity (e.g. James Price Point)  Still some risk from offshore activism  “Shell has learned, through listening, that you need to go beyond compliance to win the trust of your neighbours”
  • 19. Turning constraints of FLNG to advantage  FLNG entirely offshore      Reduces exposure to environmental direct action Still some risk from offshore activism Avoids onshore protest activity (e.g. James Price Point) Avoids protracted delays (e.g. Corrib) Shell Corrib  Mediation failed – “the parties are unable to resolve the differences between them”  “Shell has learned, through listening, that you need to go beyond compliance to win the trust of your neighbours”
  • 20. Is the tolerance of green activism changing?  Paul Watson of Sea Shepherd has faced legal action from the United States, Canada, Norway, Costa Rica, and Japan  After skipping bail following an arrest in Germany in 2012, Interpol issued red notices requesting his arrest.  The activist who caused a $314 million temporary plunge in Whitehaven Coal's share price could face 10 years in jail  Jonathan Moylan issued a fake ANZ press release claiming ANZ had pulled a $1.2 billion loan because of environmental concerns  Greenpeace vessel Arctic Sunrise arrested by Russia  Piracy charges for boarding the Gazprom drill rig Prirazlomnaya have been downgraded to hooliganism  Senator Eric Abetz says  "With the Greens it is always a case of the ends justifying the means.’’
  • 21. Turning constraints of FLNG to advantage  FLNG entirely offshore  Potentially no requirement for WA Domgas  Western Australia’s domestic gas reservation policy, instated in 1977, was updated in 2006 and requires LNG Producers to make available domestic gas equivalent to 15% of LNG production from each LNG export project  Sales revenue of export gas and domestic gas (15% of total gas production) are approximately $12/MMBTU and $8/GJ Revenue Component 18% 8% 74% Export Gas DomGas Condensate Pie Chart: based on data from UWA Subsea Technology 2013 Team 3
  • 22. New subsea technologies for FLNG  Heating of flowlines for hydrate prevention  Direct electric heating or trace heating or heated water pipes  Eliminate need for MEG  Eliminate need for MEG reclamation on FLNG vessel  Why?  Shell Prelude has 800 m3/day MEG regeneration system to provide buffer storage, collection and regeneration of MEG x6  MEG facilities including MEG storage tanks, MEG desalination package, MEG regeneration package, MEG injector and MEG booster pumps MEG module for offshore Brazil application Rich MEG flow 120 m3/day 300 tonne module Image: Cameron
  • 23. New subsea technologies for FLNG  Direct Electrical Heating (DEH)  AC current to pipe  Field Proven: Single phase required  High voltage and power required (100-150 W/m)  Electrical Heat Tracing (EHT)         Heating cables between pipe and insulation Pipe in Pipe (PIP) AC three phase power Low voltage, low power (4-30 W/m) Higher safety, less dielectric ageing Qualified wire traces and subsea connectors Allows redundancy Image: Total Electrically Trace Heated Pipe-in-Pipe Integrated Production Bundle (IPB)  Hot water tubes between pipe and insulation  Use spare heat from compression / power generation  Use for risers Images: Technip Heated Flexible Flowline
  • 24. New subsea technologies for FLNG  Electrical Heat Tracing (EHT)  Low voltage, low power (4-30 W/m)  Redundant trace heating cables  Fibre optic for thermal monitoring Image: Technip
  • 25. New subsea technologies for FLNG  Electrical Heat Tracing (EHT)  Low voltage, low power (4-30 W/m)  Redundant trace heating cables  Fibre optic for thermal monitoring Maintain 20ºC Heat up Temperature Power requirements for Islay EHT Power required per metre Maintain temperature above HAT (ca 20°C) Heat up pipeline from 4 to 20°C in 24 hours Heat up pipeline from 4 to 20°C in 30 hours with 15% of hydrates Overall power required 4 to 8 W/m Ca. 50 kW 15 to 20 W/m Ca. 120 kW 30 W/m Ca. 180 kW 4ºC Courtesy: Total 20 W/m Power 8 W/m
  • 26. New subsea technologies for FLNG  Reeled installation     S-lay Faster than S-lay or J-lay Fabrication is performed onshore Controlled environment, off the critical path Weld repairs are performed onshore Courtesy: Chuck Horn/SUT Reeling onto installation vessel Image: Technip
  • 27. Risks to FLNG from subsea developments  Risk is higher with FLNG than FPSOs      Risk = Likelihood x Consequence Likelihood is higher with gas than with oil developments Consequence of loss of FLNG = $13 billion Shell Prelude Consequence of loss of FPSO = $1.5 billion UIBC 2012 data Shell statement in Prelude EIS  After comprehensive studies, model testing and in-depth reviews, Shell’s FLNG design safety is considered equal to the latest FPSO or integrated off shore facility.
  • 28. Risks to FLNG from subsea developments The Real Estate for Browse LNG at Ignominious James Price Point  Marked by shame or disgrace Image: Woodside
  • 29. Risks to FLNG from subsea developments The Real Estate for Prelude  Ignominious  Marked by shame or disgrace Image: Woodside
  • 30. Risks to FLNG from subsea developments The Real Estate for 3 x FLNG  Ignominious  Marked by shame or disgrace Image: Woodside
  • 31. Case Study Courtesy: UWA Subsea Technology 2013 Team 1
  • 32. Case Study – Browse LNG Development Major gas fields: development status, as of March 2012 Courtesy: Geoscience Australia
  • 33. Case Study – Browse LNG Development Reservoir Gas Condensate CO2 Content Torosa Brecknock Calliance 8.5 Tcf 4.0 Tcf 3.0 Tcf 159 MMbbl 144 MMbbl 114 MMbbl 8% CO2 8% CO2 12% CO2 Remoteness of Browse Basin from Existing Infrastructure Challenging Access Courtesy: UWA Subsea Technology 2013 Team 1
  • 34. Case Study – Browse LNG Development Courtesy: Scott Reef Rugbjerg_2009
  • 35. Case Study – Browse LNG Development Courtesy: UWA Subsea Technology 2013 Team 1
  • 36. Case Study – Browse LNG Development Courtesy: UWA Subsea Technology 2013 Team 1
  • 37. Case Study – Browse LNG Development  Subsea systems with LNG facilities on Scott Reef Image: LNG Conceptual Design Strategies
  • 38. Case Study – Browse LNG Development Courtesy: UWA Subsea Technology 2013 Team 1
  • 39. Case Study – Browse LNG Development
  • 40. UWA Subsea Technology 2013 teams Case Study – Browse LNG Development
  • 41. Case Study – Browse LNG Development Project Analogues Topsides Team 1 Shell Prelude Team 3 Wandoo B Team 4 Inpex Ichthys Infield Central Processing Facility with compression, LNG trains at JPP 36" CS x 325 km export pipeline 36 billion Initial CAPEX 13.4 billion, total $45 bn LNG trains 4.2, 4.3, 4.7 MTPA Nominal flowrate 717+740+800 MMSCFD $47.3 bn 3 off 4 MTPA 2200 MMSCFD Concrete Gravity Structure with slug catcher in 45 metre WD, LNG trains at JPP LNG Precinct 26" CS x 115 km, 24" CS 240 km export pipeline 22 billion (questionable benchmark ing ) 3 off 4.3 MTPA 1748 MMSCFD Field life Control of field 39 years Closed loop MUX-EH Payback First LNG Well count Drilling Phases 35 billion, 10% discount rate 6.5 years after production 2024 53 wells total 6 (9+10+12+13+5+3 wells) 25 years MUX-EH (fibre optic), from CGS 12 billion 36 years MUX-EH from CPF NPV 19 years Closed loop MUX-EH, via control buoy 18 billion 6 years after production 2018 46 wells total 5 (13+8+8+10+7 wells) Trees 7" horizontal 6 years after production 2017 26 wells total 13 (19+1+1+1+1+1+2+5+ 1+1+1+1+1 wells) 7" vertical monobore trees 7" enhanced horizontal trees 8 years after production 2017 19 wells total 7 (6+1+1+1+1+1+1+2+ 1+1+1 wells) 7" horizontal Completions 7" completions Reinject into reservoir 9 5/ 8" and 7" completions Reinject into reservoir, 18" CS 280 km pipeline 9 5/8" and 7" completions 9 5/8" completions Export Pipeline FLNG Team 2 Chevron Gorgon (+ Apache East Spar Control Buoy) LNG trains at JPP LNG Precinct N/A CAPEX CO2 40" CS 310 km pipeline 2 off 3.65 MTPA 1500 MMSCFD 15 billion
  • 42. Case Study – Browse LNG Development Torosa, Brecknock and Calliance Challenging Reservoir Courtesy: UWA Subsea Technology 2013 Team 1
  • 43. Case Study – Browse LNG Development Challenging Environment Courtesy: UWA Subsea Technology 2013 Team 1
  • 44. Case Study – Browse LNG Development Subsea-to-Shore tieback Tieback to Offshore Processing Facility and to LNG Plant Onshore Option A Floating LNG Option B Option C Courtesy: UWA Subsea Technology 2013 Team 1
  • 45. Case Study – Browse LNG Development FLNG 1 10Prod+2 CO2 Injection TOTAL 12 wells CALLIANCE Phase 1 FLNG 2 13Prod+2 CO2 Injection TOTAL 15 wells BRECKNOCK Phase 2 FLNG 1 11Prod+2 CO2 Injection TOTAL 13 wells TOROSA – South Phase 4 TOROSA – North Phase 3 FLNG 3 11Prod+2 CO2 Injection TOTAL 13 wells Courtesy: UWA Subsea Technology 2013 Team 1
  • 46. Case Study – Browse LNG Development Cash flow Arrow shows the Start of Production NPVa = $31.78B, IRR = 6.87% NPVb =$27.46B, IRR = 5.78% NPVc=$35.03b, IRR = 10.53% Courtesy: UWA Subsea Technology 2013 Team 1
  • 47. Case Study – Browse LNG Development Production Rate vs Time 3000 Production rate MMSCF/D 2500 2000 1500 Production capacity Operation rate 1000 500 0 0 5 10 15 20 25 Production Year 30 35 40 Courtesy: UWA Subsea Technology 2013 Team 1
  • 48. INJECTION X-TREE INJECTION PIPELINE FLOWLINE UTA UMBILICALS SDU SPARE SLOT RISER BASE + SSIV Water depth: 500 m PRODUCTION PIPELINE PLET FIELD LAYOUT: CALLIANCE PRODUCTION X-TREE MANIFOLD Manifold: C01 Phase 0 (4ea) Slot - S01,S02,S03,S04 Future expansion wells: S05,S06 SDU UMBILICALS X-TREE JUMPER PLET Injection Wells Phase 0 (2ea injection wells daisy-chain) Manifold: C02 • Phase 0 (3ea) Slot - S01,S02,S03 • Phase 1 (2ea) Slot - S04, S05 • Phase 2 (1ea) Slot - S06 N Water depth: 380 m
  • 49. PRODUCTION PIPELINE FIELD LAYOUT: BRECKNOCK INJECTION PIPELINE FLOWLINE UMBILICALS SPARE SLOT Water depth: 680 m Manifold: B02 • Phase 2 (3ea) Slot - S01,S02,S03 Manifold: B03 • Phase 3 (3ea) Slot - S01,S02,S03 • Phase 4 (1ea) Slot - S04 MANIFOLD PRODUCTION X-TREE INJECTION X-TREE PLET UTA SDU RISER BASE + SSIV Injection Wells • Phase 1 (2ea CO2 Injection wells) Manifold: B01 • Phase 1 (6ea) Slot - S01,S02,S03,S04,S05,S06 ` Water depth: 500 m N
  • 50. PRODUCTION PIPELINE FIELD LAYOUT: TOROSA – NORTH INJECTION PIPELINE FLOWLINE UMBILICALS SPARE SLOT Manifold: T03 Phase 4 (2ea) Slot - S01,S02 MANIFOLD PRODUCTION X-TREE Phase 5 (1ea) Slot – S03 PLET INJECTION X-TREE UTA SDU RISER BASE + SSIV (Inset) Manifold T01 Manifold: T01 Phase 2 (6ea) Slot - S01,S02,S03,S04,S05,S06 Water depth: 290 m Manifold: T02 Phase 3 (2ea) Slot - S01,S02 Injection Wells Phase 2 (2ea CO2 injection wells) N
  • 51. FIELD LAYOUT: TOROSA – SOUTH Ave. inclination 5.7 degrees Manifold: T04 Phase 3 (6ea) Slot - S01,S02,S03,S04,S05,S06 Water depth: 2000 m Water depth: 1500 m Water depth: 1000 m PRODUCTION PIPELINE Water depth: 500 m INJECTION PIPELINE Manifold: T05 Phase 4 (2ea) Slot - S01,S02 FLOWLINE UMBILICALS SPARE SLOT MANIFOLD PRODUCTION X-TREE Injection Wells Phase 3 (2ea CO2 injection wells daisy-chain) INJECTION X-TREE PLET Manifold: T06 Phase 5 (3ea) Slot - S01,S02,S03 N UTA SDU RISER BASE + SSIV Ave. inclination 10 degrees
  • 52. Case Study – Browse LNG Development Courtesy: UWA Subsea Technology 2013 Team 1
  • 53. Case Study – Browse LNG Development Carbon Sequestration Courtesy: UWA Subsea Technology 2013 Team 2
  • 54. Case Study – Browse LNG Development Project Economics Key Figures CAPEX - $46.16B Total Project Cost FLNG -$42.92B Subsea -$3.24B OPEX - $440M per FLNG vessel annually including fuel, staff, transport assistance NPV10 $35.03B IRR 10.53% Courtesy: UWA Subsea Technology 2013 Team 1
  • 55. Closing Remarks  The Shell Prelude development  Single umbilical – single point of failure  9% CO2 vented up flare stack – 2.3 MTPA Image: Shell Environment Plan Prelude Drilling
  • 56. FLNG – Another South Sea Bubble?  The South Sea Bubble  1718-1721  The first stock market crash
  • 57. FLNG – Another South Sea Bubble?  The South Sea Bubble  1718-1721  The first stock market crash
  • 58. FLNG – Another South Sea Bubble?  The South Sea Bubble  1718-1721  The first stock market crash
  • 59. Subsea Developments for FLNG Production  Smaller, Smarter, More Dangerous  kevin.mullen@intecsea.com

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