www.agr-ps.com
Ian Burdis
Vice-President – Well Management
Strategies and
Practices to realise
the maximum
potential of NO...
www.agr-ps.com
• Oil Price rise trend over past
12 months
• Implies rising production
demand shortfall not
affected by wes...
www.agr-ps.com
0
1
2
3
4
5
6
7
8
9
10
2010 2011 2012 2013 2014 2015
M
p
o
b
Extra Daily Production per annum
Extra Daily P...
www.agr-ps.com
The End of Easy Oil...
• Hydrocarbon demand driven from non-OECD countries
• NOC supply via
• Increased dom...
www.agr-ps.com
Changing Operator Environment
• Proportion of world hydrocarbon reserves:
• Under NOC auspices – increasing...
www.agr-ps.com
Changing Operator Environment
• NOC: Similar, but many differences:
• Models
• Objectives: Resource Nationa...
www.agr-ps.com
Changing Operator Environment
• Used to be conservative, but now much more varied & fragmented than 20
year...
www.agr-ps.com
Changing Contractor Environment
• In an expanding business environment the drive for skills and experienced...
www.agr-ps.com
Changing Contractor Environment
• Used to be linked to the provision of hardware and related technology, bu...
www.agr-ps.com
Well Project Management Company
• Has similar scale of human resources to many IOC
• former IOC, Service Ma...
www.agr-ps.com
Traditional NOC Model
NOC
Drilling Services
30-35 Contracts Drilling Rig Logistics & Materials
• eg. Malays...
www.agr-ps.com
NOC – IOC - Service Major Model
NOC
IOC
Drilling Services
30-35 Contracts Drilling Rig Logistics & Material...
www.agr-ps.com
NOC –Service Major Model
NOC
Drilling Services
30-35 Contracts Drilling Rig Logistics & Materials
Service M...
www.agr-ps.com
Areas of Dramatic Change: Over Short Time Period
• Still volatile although general activity trend is upward...
www.agr-ps.com
NOC / WPM Contract Model
WPM
Drilling Services
30-35 Contracts Drilling Rig Logistics & Materials
NOC
• Wid...
www.agr-ps.com
Established Processes
• Established Policies and Procedures
• Well construction, HS&E
• Procurement: MSAs
•...
www.agr-ps.com
Performance as a Result of Planning & Execution
• Well Project Management (WPM) Company
• Front-End Enginee...
www.agr-ps.com
Performance – Downhole Technologies
• Well Project Management (WPM) Company
• does not have any hardware, o...
www.agr-ps.com
Value Delivery - Benefits of Alternative Approach
• Independence of Well Project Management company
• not a...
www.agr-ps.com
Outsourced Well Project Management - Benefits
• Lessons Learned from other geographic areas & other operati...
www.agr-ps.com
Outsourced Well Project Management - Concerns
As a new phenomenon (< 10 years)
• Lack of visibility in the ...
www.agr-ps.com
Conclusions
• Worldwide demand for hydrocarbons is still increasing
• Supply from traditional reservoirs & ...
www.agr-ps.com
AGR – Our Role in delivering value….
– Benefits to Features
Fox guarding the henhouse
23
Service Major:
• E...
www.agr-ps.com
AGR PS Recent Track Record
• AGR PS – has successfully managed drilling of > 400 wells in 10 years
• AGR PS...
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Ian burdis's presentation slides from the 2010 World National Oil Companies Congress

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Ian burdis's presentation slides from the 2010 World National Oil Companies Congress that took place in June in London.

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Ian burdis's presentation slides from the 2010 World National Oil Companies Congress

  1. 1. www.agr-ps.com Ian Burdis Vice-President – Well Management Strategies and Practices to realise the maximum potential of NOC’s and IOC’s
  2. 2. www.agr-ps.com • Oil Price rise trend over past 12 months • Implies rising production demand shortfall not affected by western recession. • Decline rate of oil production without including new IOR – EOR or drilling:: 3.4% • All models indicate peak already reached or will be by 2015 2 Peak Oil Production – decline?
  3. 3. www.agr-ps.com 0 1 2 3 4 5 6 7 8 9 10 2010 2011 2012 2013 2014 2015 M p o b Extra Daily Production per annum Extra Daily Production vs 2009 Continued demand... 20 30 40 50 60 70 80 90 100 Global Oil Demand OECD Non OECD Total Hydrocarbon demand driven from non-OECD countries Large incremental daily Hydrocarbon supply increases required
  4. 4. www.agr-ps.com The End of Easy Oil... • Hydrocarbon demand driven from non-OECD countries • NOC supply via • Increased domestic & international expansion activity • New areas technically & geographically • Gas, HPHT, Offshore • IOC supply via • Harsher, more remote environments • Deepwater, HPHT • Unconventional • Gas
  5. 5. www.agr-ps.com Changing Operator Environment • Proportion of world hydrocarbon reserves: • Under NOC auspices – increasing – 85% • Under IOC auspices – decreasing
  6. 6. www.agr-ps.com Changing Operator Environment • NOC: Similar, but many differences: • Models • Objectives: Resource Nationalism • Access to finance • Access to hydrocarbon assets • Varied Technical capability • Level of dependence on IOC • Mobility of product • IOC: Similar, traditional • Differ in scale • Large : access to $ • Small : less access • High Capability • Extend product offering: • Transport of product
  7. 7. www.agr-ps.com Changing Operator Environment • Used to be conservative, but now much more varied & fragmented than 20 years ago • Much IOC consolidation • Many small independents appearing globally • Service Majors playing an expanded role • Huge planned increases in business • Eg. Iraq, other Middle East, Brazil • All players require degree of flexibility because of variation in demand for services • Resource access is an issue for all players
  8. 8. www.agr-ps.com Changing Contractor Environment • In an expanding business environment the drive for skills and experienced resources is constant and competition is fierce • Many companies introduced outsourcing in a drive to reduce overheads. & access resources Outsourced services have typically included IT, Accounting, HR, Facilities engineering, design & construction, Reservoir management & Facilities operations management • Many companies embarked on a search for alternative commercial models for reservoir & well delivery. • The benefits of outsourcing are seen as:- • Access to capacity, supplementary or discrete • Access to specialist skills/experience • Cost effective access to shared software and products • Flexibility in scale, discipline and duration • Lower overheads
  9. 9. www.agr-ps.com Changing Contractor Environment • Used to be linked to the provision of hardware and related technology, but now much more varied, fragmented than 20 years ago • Service Majors playing an expanded role • Work direct for NOC • Providing bundled “all service packages” • Increase in local Service Companies • A new service offering has emerged, non related to the provision of hardware • 35 companies now providing well management services in UK, Norway, N America, S America, Africa, ME & Asia/Pacific • eg. 67% of all mobile drilling in N Sea in 2008 conducted by outsourced well management companies
  10. 10. www.agr-ps.com Well Project Management Company • Has similar scale of human resources to many IOC • former IOC, Service Major staff, high level international experience • has no equipment assets • Can do all that an IOC can do • except funding, HC sale or PSC, as has no subsurface assets • Solid safety and operational track record • Full project management: • G&G, Drilling & Production technology • SCM, Logistics, Security, HSEQ • Flexible commercial model, designed to fit every application • Fee based remuneration
  11. 11. www.agr-ps.com Traditional NOC Model NOC Drilling Services 30-35 Contracts Drilling Rig Logistics & Materials • eg. Malaysia, India, Kingdom Saudi Arabia
  12. 12. www.agr-ps.com NOC – IOC - Service Major Model NOC IOC Drilling Services 30-35 Contracts Drilling Rig Logistics & Materials Service Major • eg Iraq
  13. 13. www.agr-ps.com NOC –Service Major Model NOC Drilling Services 30-35 Contracts Drilling Rig Logistics & Materials Service Major • eg Mexico, Algeria, Saudi Arabia (in part)
  14. 14. www.agr-ps.com Areas of Dramatic Change: Over Short Time Period • Still volatile although general activity trend is upwards • Activity level increase • Volume • Increased rig and well count • Resource shortage • Technical level • Subsurface: • Improved seismic acquisition and interpretation • Drilling and Completion: • Vertical post-hole well to Maximum Reservoir Contact • Harsher environments • HPHT, Abrasive, Deepwater, remote • Field Development Plans to include IOR Techniques to deliver higher production
  15. 15. www.agr-ps.com NOC / WPM Contract Model WPM Drilling Services 30-35 Contracts Drilling Rig Logistics & Materials NOC • Widely used by Independents & some NOCs
  16. 16. www.agr-ps.com Established Processes • Established Policies and Procedures • Well construction, HS&E • Procurement: MSAs • Well Delivery Process • Codified • Step-by-step approach to well design • Milestones and deliverables • Project management skills & process • Probabilistic Well Construction Software • Understanding and managing risk • Time and cost estimation • Drilling & Subsurface Training
  17. 17. www.agr-ps.com Performance as a Result of Planning & Execution • Well Project Management (WPM) Company • Front-End Engineering • Well Delivery Process • Risk Modelling • Tendering • Profit centre • Rig • Selection • Procurement • Relationships with many land, JU, HD JU, semi, DS & DW drilling contractors • Personnel assurance • Down-hole tools & services employed • Performance driven
  18. 18. www.agr-ps.com Performance – Downhole Technologies • Well Project Management (WPM) Company • does not have any hardware, only substantial know-how • works with all service companies to deliver the most value for clients at the best price • Service companies design and own the technology • is fully impartial, as not linked to any service company, drilling company; profit derived only from WPM • is fully cognisant of all industry technology • is fully cognisant of all forms of drilling: • Deep • Extended Reach • Offshore & Deepwater • Underbalance • Geosteering / Maximum Reservoir Contact
  19. 19. www.agr-ps.com Value Delivery - Benefits of Alternative Approach • Independence of Well Project Management company • not allied to any rig contractor or service company • Includes reservoir management, G&G capability & Facilities engineering • Seamless/invisible integration of WPM into client or partner organisation • Can be used as independent verification • Remuneration: • Fee Based, not: • $ / bbl or $ / TCF • Time based rental of service equipment • Aligned with cost and performance objectives of client
  20. 20. www.agr-ps.com Outsourced Well Project Management - Benefits • Lessons Learned from other geographic areas & other operations • Fast Learning curve • Portability & flexibility • Repeatability • Fully cognisant of: • all latest service company technologies & practices • drilling contractors, day rates, rig specifications, access, relationships • Ability to train client personnel through established material • Contracting competence & experience • track record • integration of bundled services where appropriate to client & project
  21. 21. www.agr-ps.com Outsourced Well Project Management - Concerns As a new phenomenon (< 10 years) • Lack of visibility in the industry • Nomenclature: WPM, Project Management = Facilities? • Mainly confined to Western Countries • N Sea, GOM, Australia etc • Procurement Protocols • Most NOC’s do not even include WPM as an ITT line item • Confused with Body Shop analogy • Variance in Quality product offering: • Process, Procedure, Systems • Loss of control. WPM client stays in control, not “turnkey”
  22. 22. www.agr-ps.com Conclusions • Worldwide demand for hydrocarbons is still increasing • Supply from traditional reservoirs & sources has peaked • New supplies will come from new geographies & environments presenting new challenges • NOCs are expanding their area of influence and activity • The demand for resources and capacity with the right skills and experience is high • Operator & Contractor environments and inter-relationships are changing. Alternate, flexible solutions are required • New technical and commercial solutions, product offerings and services are available in the market • Out-sourced well project management is now a credible and mature alternative solution to meet changing NOC needs
  23. 23. www.agr-ps.com AGR – Our Role in delivering value…. – Benefits to Features Fox guarding the henhouse 23 Service Major: • Earns $ from equipment rental • This revenue >> PM Revenue • So Service Major : • Will – supply as much equipment , for as long as possible • Will not – replace it’s own equipment by competitor Oil Major: • Earns $;s / bbl from PSC • This revenue >> PM Revenue • So Oil Major : • Will – engage in joint supply of oil (gas), for as long as possible • Extend term • Will not – do anything that shortens term, training, share global best practice Independent WPM: Shepherd guarding the flock
  24. 24. www.agr-ps.com AGR PS Recent Track Record • AGR PS – has successfully managed drilling of > 400 wells in 10 years • AGR PS – low profile outside NW Europe, US, Asia-Pacific (3 regions) • AGR PS is a comparatively new company • AGR PS business model, while new for NOCs, is extensive elsewhere
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