Page 47 - Intelligent Digital Oil And Gas Fields

Introduction to Digital Oil and Gas Field Systems 27

1.7 FINANCIAL POTENTIAL OF A DOF IMPLEMENTATION

Companies must evaluate the economic potential of a DOF imple-
mentation. The spectrum of investment ranges with the size of a company
and its assets: from large international and national companies, to mid-size
companies, to even small independents. Costs can range from tens of mil-
lions of dollars for the largest assets, to a few million dollars for smaller assets,
depending on the sensors, communication networks, IT and database,
decision-support requirements, and analytical tools.
The following exercise is a prototype to estimate the value and financial
return of a DOF implementation for a 20-year timeframe, for a mid-size,
onshore field.

1.7.1 Field Description Example
This exercise assumes an onshore field of 100 wells with a daily production
of 20 MSTB of crude oil (30 API), 10 MSTB of water, 20 million SCF
of gas, and total recoverable hydrocarbon in situ of 100 million STB.
The reservoir is submitted to water injection flooding and the wells produce
using ESPs. The oil decline rate is estimated to be 10% annually. This is a
new installation, not a retrofit of existing well controls and other equipment.
The operator wants to achieve these goals with a DOF implementation:
• reduce the frequency of well shutdown per month
• increase the oil uplift and decrease oil decline
• delay the water breakthrough and manage water production efficiently

1.7.2 Cost Estimates

These cost estimates are based on price lists from several business cases
presented by Cisco, IBM, and Honeywell. Fig. 1.12 shows a breakdown
of capital investment costs. For an implementation to reach the goals stated
above, an operator would need to upgrade 100 wellheads with controls
panels, actuators, choke setting, cables, and pressure and temperature gauges,
WiMAX, routers, sensors, and fiber optic cables, with a total cost estimate of
$35 million. Additionally, the operator would need to revamp the data
center; integrate data streams from the field to the repository center; build
servers, CPUs, and cluster with enough data storage for 20years; and con-
struct a collaborative working environment (CWE), with an estimated total
cost of $10 million. To generate new automated workflows and purchase