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International PetroChallenge2010<br />
Purpose<br />You are an exploration team in charge of a new petroleum province. <br />Multidisciplinary challenge: Enhance...
Money/KP’s<br />You start with $200 million<br />Create valueNet value of the oil and gas discovered MINUS all costs invol...
You will learn<br />Where and how to find hydrocarbons <br />Licensing rounds <br />Farm-in and Partnerships - negotiation...
Oil and Gas Value Chain<br />Gas<br />Oil<br />
Login<br />www.oilsim.com<br />
Login<br />www.oilsim.com<br />
Main screen<br />
Map<br />Columns  e.g C1 to C112 <br />Rows  e.g. R1 to  R144<br />Block<br />Blocks are dividedinto 64 smaller cells<br /...
First task<br />Challenge: Find three sedimentary basins  <br />Procedure: <br />Buy and study magnetic and gravimetric su...
Gravimetric surveys<br /><ul><li>Gravimetric surveys indicate changes in the gravitational pull of the Earth in different ...
Lower gravitational fields  indicates likelihood of low density rocks –Sedimentary rocks, porous and hopefully containing ...
Magnetic surveys<br />Magnetic surveys show anomalies in in the expected magnetic field of the Earth in particular areas. ...
Survey in OilSim<br />Magnetic survey:North-west quadrant<br />
Survey in OilSim<br />All four quadrant surveys in map context<br />
Finding the Midpoint<br />
Survey analysis<br />Locate edges of the continous basin structure<br />Locate the diagonals and thus basin centre<br />
Centre may not be the same<br />Example:<br />Top basin on both maps <br />Calculate the midpoint between the gravimetric ...
Centre Midpoint calculation<br />3 centres – one Centre midpoint for each basin<br />Example: C55, R105<br />Solve before ...
Task 1 solved<br />Message in Inbox: <br />Shows results<br />Answers submitted<br />KPs awarded<br />
Task 2 license round<br />The government has decided to put the blocks in one of the basins on offer.<br />Challenge: Iden...
Task 2 license round<br />Any restrictions involved?- Spawning grounds<br />What are we looking for?  - Prospects<br />Whe...
Source and migration<br />2. MIGRATION ROCK<br />where hydrocarbons are driven through<br />3. CAP ROCK<br />Impermeable r...
Traps<br /><ul><li>Geological “pockets”, that might contain hydrocarbons.</li></ul>Anticline trap<br />(c) OLF<br />Strati...
Environmentally Sensitive areas<br />Red areas<br />You will not be awarded blocks that contain any red spots (spawning gr...
Common Risk Segment<br />CRS. Common Risk Segment surveys tell you about the probability of a structure in the block/cell ...
2D Seismic surveys<br />Traps can be found with seismic surveys and sound waves bouncing off structures <br />2D seismic s...
Real Seismic<br />                                                                                                        ...
OilSim of 2DSeismic <br />Unprocessed<br />Processed<br />Red is top of  the sealing rock<br />Green is top of  the reserv...
Order Seismic<br />What type of data do you want?<br /><ul><li>Columns or Rows
Unprocessed or processed data
Interpreted or not</li></ul>Only buy maximum of 1 block of data at a time to speed up processing<br />
Processing Seismic<br /><ul><li>It takes time to process your request
Created to order
Moves to surveys once processed</li></li></ul><li>View the Seismic<br /><ul><li>Red circles – navigate through the 2D seismic
Yellowsquare – Row 1 from Column 1-56</li></li></ul><li>Anticlinal traps<br />
Fault traps<br />Leakage?<br />
Leakage?<br />Leakage?<br />
Cross-sections<br />Column<br />Row<br />Prospect, Reservoir<br />Basin,Source<br />
Enter bids<br /><ul><li>Three blocks
Three amounts
Min: $1M
Max: $30M
You will only getawarded one block – and only pay for one
Highest bid wins
If equal, then team with highest KP wins</li></li></ul><li>Recap on Task 2<br />Environmentally sensitive areas – blocks t...
Task 2 solved<br />Message sent to all Results and KPs<br />One license per team<br />
Task 3 Exploration Drilling<br />The headquarters of your company has evaluated the license that you were awarded.<br />Al...
Task 3a Partnerships<br />Acquire 3D Seismic interpretations for the block you operate, and study the results from the lic...
Real 3D Seismic<br />Shows the subsurface structure in a cube.<br />
3D Seismicin OilSim<br />Prospects <br />are no <br />guarantee of oil or gas<br />Layer 3 Eocene<br />Layer 2 Paleocene<b...
Partnerships<br />Spread the risk: e.g Investing in other blocks divides the risks amongst all partners, much more  prefer...
Licences<br />
Farm-in<br /><ul><li>Either accept the amount or % the license owner requests, or amend the amounts to your own offer
Add a message to the seller
Press “Send offer”
Minimum of $100000 per %</li></li></ul><li>Farm-in<br />When a team receives a Farm-In offer to appears under Financing.  ...
Farm-in<br />license OWNER decides whether to ACCEPT or REJECT the offer<br />Partnerships established every time a licens...
Farm-in<br />All your farm-in offers to other teams are shown under “Investing” on the right-hand side of the homepage . <...
Partnerships<br />Partners pay a proportional share of all future costs incurred by the partnership<br />Partners receive ...
Water depth<br /><ul><li>Before choosing a rig, you need to check your water depth </li></ul>Find this at the bottom of th...
Choose Rig<br />Choose the right rigs for your water depths<br />Jack-up rigs for shallow waters<br />Semi-submersible rig...
Rigs<br />Few: limited number of rigs available.<br />If you get one: start using it within 20 minutes.<br />If you don’t:...
Drilling Days<br />
Service Providers<br />Upto 9 Star quality-<br />Good: normally costs more<br />Bad: cheaper, <br />     but reliability i...
Environmental Impact Assessment<br />EIA survey: more knowledge about the area.<br />Less probability for drilling problem...
Drill Position<br />EIA: enviromental impact analysis shows where not to drill.<br />Place your mouse where  to drill<br />
Penalties & Fines<br />Certain problems can occur if Service Provider Selection is poor quality<br />Other penalties can o...
Drilling Position<br />Layer 3 Eocene<br />Layer 2 Paleocene<br />Layer 1 Cretaceous<br />
Estimated cost<br />
Drilling Result<br />
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Petro challengefinal 2010 ppt presentation

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Petro challengefinal 2010 ppt presentation

  1. 1. International PetroChallenge2010<br />
  2. 2. Purpose<br />You are an exploration team in charge of a new petroleum province. <br />Multidisciplinary challenge: Enhance your overall understanding of petroleum exploration and field development.<br />Create a Return on Investment <br />
  3. 3. Money/KP’s<br />You start with $200 million<br />Create valueNet value of the oil and gas discovered MINUS all costs involved<br /><ul><li>Knowledge points awarded</li></ul>Sensible decisions and correct answers<br />KPs are a measure of ability and credibility<br />Considered when bidding for blocks<br />Use when applying for funds <br />
  4. 4. You will learn<br />Where and how to find hydrocarbons <br />Licensing rounds <br />Farm-in and Partnerships - negotiations<br />Drilling rigs <br />Sub-contractors<br />Environmental issues<br />Economically viable volumes<br />Team work, Critical decision making, analytical skills<br />Multi-tasking<br />
  5. 5. Oil and Gas Value Chain<br />Gas<br />Oil<br />
  6. 6. Login<br />www.oilsim.com<br />
  7. 7. Login<br />www.oilsim.com<br />
  8. 8. Main screen<br />
  9. 9. Map<br />Columns e.g C1 to C112 <br />Rows e.g. R1 to R144<br />Block<br />Blocks are dividedinto 64 smaller cells<br />e g. R52C110<br />
  10. 10. First task<br />Challenge: Find three sedimentary basins <br />Procedure: <br />Buy and study magnetic and gravimetric surveys<br /> Submit the coordinates for each centre<br />Column and row number for each basin centre<br />
  11. 11. Gravimetric surveys<br /><ul><li>Gravimetric surveys indicate changes in the gravitational pull of the Earth in different areas of the sub-surface.
  12. 12. Lower gravitational fields indicates likelihood of low density rocks –Sedimentary rocks, porous and hopefully containing hydrocarbons</li></li></ul><li>Surveys in Oilsim<br />Survey shop<br />Gravimetric survey of North-west area<br />
  13. 13. Magnetic surveys<br />Magnetic surveys show anomalies in in the expected magnetic field of the Earth in particular areas. <br />Sedimentary rocks in the basins have a lower concentration of magnetic materials and lower magnetic field than the surrounding crystalline rocks. <br />
  14. 14. Survey in OilSim<br />Magnetic survey:North-west quadrant<br />
  15. 15. Survey in OilSim<br />All four quadrant surveys in map context<br />
  16. 16. Finding the Midpoint<br />
  17. 17. Survey analysis<br />Locate edges of the continous basin structure<br />Locate the diagonals and thus basin centre<br />
  18. 18. Centre may not be the same<br />Example:<br />Top basin on both maps <br />Calculate the midpoint between the gravimetric and magnetic centres found<br />= C55 and R105<br />C50<br />R100<br />C60<br />R110<br />
  19. 19. Centre Midpoint calculation<br />3 centres – one Centre midpoint for each basin<br />Example: C55, R105<br />Solve before deadline. All submissions are evaluated after the deadline (and not before).<br />You may get 0-100 KPs. All three centres must be located to get full knowledge points.<br />
  20. 20. Task 1 solved<br />Message in Inbox: <br />Shows results<br />Answers submitted<br />KPs awarded<br />
  21. 21. Task 2 license round<br />The government has decided to put the blocks in one of the basins on offer.<br />Challenge: Identify the 3 most promising blocks and offer an amount for each of them.<br />Licensing area<br />
  22. 22. Task 2 license round<br />Any restrictions involved?- Spawning grounds<br />What are we looking for? - Prospects<br />Where do we find prospects? <br />In basins, where hydrocarbons have been<br /> 1) are produced and 2) trapped<br />How do I find them? - Geoscientific analysis<br />2D seismic, Common Risk Segment maps<br />
  23. 23. Source and migration<br />2. MIGRATION ROCK<br />where hydrocarbons are driven through<br />3. CAP ROCK<br />Impermeable rock that stops migration of hydrocarbons<br />1. SOURCE ROCK<br />where organic material is put under sufficient pressure<br />4. PROSPECT<br />
  24. 24. Traps<br /><ul><li>Geological “pockets”, that might contain hydrocarbons.</li></ul>Anticline trap<br />(c) OLF<br />Stratigraphic<br /> trap<br />Salt dome trap<br />Fault trap<br />
  25. 25. Environmentally Sensitive areas<br />Red areas<br />You will not be awarded blocks that contain any red spots (spawning grounds)<br />Blue areas<br />Blocks in area may be awarded<br />
  26. 26. Common Risk Segment<br />CRS. Common Risk Segment surveys tell you about the probability of a structure in the block/cell containing oil or gas<br />Surface<br />Layer 3 Eocene<br />1500m below the seabed<br />Layer 2 Paleocene<br />2500m below the seabed<br />Layer 1 Cretaceous<br />3500m below the seabed<br />
  27. 27. 2D Seismic surveys<br />Traps can be found with seismic surveys and sound waves bouncing off structures <br />2D seismic survey is a vertical cross section of the geological layers along either a column or a row<br />
  28. 28. Real Seismic<br />                                                                                                                                                                       <br />
  29. 29. OilSim of 2DSeismic <br />Unprocessed<br />Processed<br />Red is top of the sealing rock<br />Green is top of the reservoir rock<br />Interpreted<br />
  30. 30. Order Seismic<br />What type of data do you want?<br /><ul><li>Columns or Rows
  31. 31. Unprocessed or processed data
  32. 32. Interpreted or not</li></ul>Only buy maximum of 1 block of data at a time to speed up processing<br />
  33. 33. Processing Seismic<br /><ul><li>It takes time to process your request
  34. 34. Created to order
  35. 35. Moves to surveys once processed</li></li></ul><li>View the Seismic<br /><ul><li>Red circles – navigate through the 2D seismic
  36. 36. Yellowsquare – Row 1 from Column 1-56</li></li></ul><li>Anticlinal traps<br />
  37. 37. Fault traps<br />Leakage?<br />
  38. 38. Leakage?<br />Leakage?<br />
  39. 39. Cross-sections<br />Column<br />Row<br />Prospect, Reservoir<br />Basin,Source<br />
  40. 40. Enter bids<br /><ul><li>Three blocks
  41. 41. Three amounts
  42. 42. Min: $1M
  43. 43. Max: $30M
  44. 44. You will only getawarded one block – and only pay for one
  45. 45. Highest bid wins
  46. 46. If equal, then team with highest KP wins</li></li></ul><li>Recap on Task 2<br />Environmentally sensitive areas – blocks to avoid <br />Common Risk Segment surveys – areas of higher probability of prospects <br />2D seismic – blocks with most structures <br />Final tip - Check water depth - shallow water blocks <br />
  47. 47. Task 2 solved<br />Message sent to all Results and KPs<br />One license per team<br />
  48. 48. Task 3 Exploration Drilling<br />The headquarters of your company has evaluated the license that you were awarded.<br />Although the possibility of finding oil is fair, the costs involved are large. Thus the headquarters want you to spread the risk. <br />Challenge: You shall farm-out minimum 20% from your license – and farm-in as much as you can in other good licenses.<br />
  49. 49. Task 3a Partnerships<br />Acquire 3D Seismic interpretations for the block you operate, and study the results from the licensing round<br />Farm-out: Get others to invest 20% or more in your license – you can send them surveys<br />Farm-in: Send offers to other teams to buy shares in their viable licenses. Submit an offer for each viable license, with amount offered and share wanted in whole %.<br />
  50. 50. Real 3D Seismic<br />Shows the subsurface structure in a cube.<br />
  51. 51. 3D Seismicin OilSim<br />Prospects <br />are no <br />guarantee of oil or gas<br />Layer 3 Eocene<br />Layer 2 Paleocene<br />Layer 1 Cretaceous<br />
  52. 52. Partnerships<br />Spread the risk: e.g Investing in other blocks divides the risks amongst all partners, much more preferable than keeping 100% of one field and all the risk.<br />Increase probability of profit: investment in only 1 field which could be a dry prospect is possible, whereas the likelihood of investing in 5 fields which are all dry is unlikely.<br />
  53. 53. Licences<br />
  54. 54. Farm-in<br /><ul><li>Either accept the amount or % the license owner requests, or amend the amounts to your own offer
  55. 55. Add a message to the seller
  56. 56. Press “Send offer”
  57. 57. Minimum of $100000 per %</li></li></ul><li>Farm-in<br />When a team receives a Farm-In offer to appears under Financing. This is where a team can receive finance or money for a % of their own blocks <br />
  58. 58. Farm-in<br />license OWNER decides whether to ACCEPT or REJECT the offer<br />Partnerships established every time a license owner accepts an offer.<br />Overview: On the main page, you can see all licenses. 1) licenses you operate, 2) licenses you have invested in, and other licenses.<br />
  59. 59. Farm-in<br />All your farm-in offers to other teams are shown under “Investing” on the right-hand side of the homepage . <br />This is where a team offers investments to other teams for a % of their blocks<br />
  60. 60. Partnerships<br />Partners pay a proportional share of all future costs incurred by the partnership<br />Partners receive a proportional share of the net proceedings from any oil or gas found on the license. <br />The operator team makes all decisions regarding acquiring 3D seismics, drilling of wells and testing of wells. <br />Information: partners in a block can access info about drilled wells and discovered oil and gas fields.<br />
  61. 61. Water depth<br /><ul><li>Before choosing a rig, you need to check your water depth </li></ul>Find this at the bottom of the BLOCK page<br />
  62. 62. Choose Rig<br />Choose the right rigs for your water depths<br />Jack-up rigs for shallow waters<br />Semi-submersible rigs for middle waters<br />Drillships for the deepest waters <br />Rig cost = drilling days * day rate<br />
  63. 63. Rigs<br />Few: limited number of rigs available.<br />If you get one: start using it within 20 minutes.<br />If you don’t: wait in a queue, if another team is using the rig.<br />Price can change: rig day rates are dynamic.<br />
  64. 64. Drilling Days<br />
  65. 65. Service Providers<br />Upto 9 Star quality-<br />Good: normally costs more<br />Bad: cheaper, <br /> but reliability is low, so you risk extra drilling time and extra costs<br />
  66. 66. Environmental Impact Assessment<br />EIA survey: more knowledge about the area.<br />Less probability for drilling problems.<br />Less severe consequences if you run into problems.<br />
  67. 67. Drill Position<br />EIA: enviromental impact analysis shows where not to drill.<br />Place your mouse where to drill<br />
  68. 68. Penalties & Fines<br />Certain problems can occur if Service Provider Selection is poor quality<br />Other penalties can occur if you drill in areas indicated as problematic in the Environmental Impact Assessment<br />As in real life, problems can occur randomly and these are also applied with fines levied accordingly.<br />
  69. 69. Drilling Position<br />Layer 3 Eocene<br />Layer 2 Paleocene<br />Layer 1 Cretaceous<br />
  70. 70. Estimated cost<br />
  71. 71. Drilling Result<br />
  72. 72. Drilling Result<br />Proven volume (MBOE) counts<br />Test may increase proven volume<br />Remember to tick the boxes!<br />
  73. 73. Testing<br />Only if you discover a field – find Oil or Gas<br />You decide whether you want more information about that field<br />More information by doing a production test (and other tests)<br />Tests costs: Tests take 10 days per field. Tests have the same day-rate as the drilling if you use the same providers.<br />
  74. 74. Value and ROI <br />
  75. 75. Discovered prospects<br />
  76. 76. Assumptions<br />
  77. 77. Value calcuation<br />25% of 8 MBOE @ $50<br />12% $39.9M<br />Expected costs if<br />you developed thefield (capex) andproducedthe oil (opex)<br />If total expenses arehigher than the salesvalue, the value of thelicense is zero<br />
  78. 78. Appraisal<br />From Probable volume to proven reserves<br />
  79. 79. Narrowing ranges<br />First well:<br />0 to 1572 MBOE (after drilling)<br />11 to 1266 MBOE (after testing)<br />Second well:<br />25 to 1033 MBOE (after drilling)<br />34 to 910 MBOE (after testing)<br />Only proven MBOE counts<br />
  80. 80. Apply For More Funds<br />Click on Apply for More Funds Tab. <br />1 KP for each $100,000 applied for.<br />Answer the questions: All correct gives cash and you can keep KPs. One wrong gives cash and you keep ½ of your KPs. Two wrong gives ½ cash and you lose all KPs. All wrong, you get no cash and lose all KPs.<br />Expensive money if less than 10 knowledge points: Apply for cash and be fined $5million for each $20million requested.<br />
  81. 81. Continue...<br />Narrow uncertainty: Drill appraisal wells to get proven volumes<br />Drill into other prospects to find more proven volumes.<br />Farm-in and -out: Get into other good blocks.<br />Two additional licensing rounds: Repeat the processes.<br />Money: Apply for more money, if you run out of cash.<br />

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