Auk North Field Development

The Production & Development Conference & ExhibitionAberdeen Exhibition and Conference Centre

12th May 2011

Auk North Field Development 12th May 2011 2

Auk North Field Development: Outline

• Background

• Appraisal

• Development Concept

• Field Determination

• Project Execution

• Current Status

• Summary

Auk North Field Development 12th May 2011 3

Background: Location

Aberdeen

United

Kingdom

Auk Field

Quad 30

Block 16

• Auk North is the northern part of the

Auk field

• The Auk field is located approximately

250 km east-south-east of Aberdeen in

Block 30/16

• The Auk field was discovered in 1971

• First production from the Auk field

occurred in 1975

• Talisman acquired the Auk field in

December 2006

Auk North Field Development 12th May 2011 4

Background: Overview of Auk Field

• The reservoir consists of Zechstein carbonates and Rotliegend sandstones containing a low gas-oil ratio (GOR) oil

• Areal extent: 60 km2

• Reservoir depth: 7300-7750’ ft TVD(SS)

• Auk North undeveloped at time of acquisition (beyond reach of platform drilling rig)

PLATFORM

Oil

Water

LINE OF SECTION

Zechstein ExtentN2

N1

N3A

N4N4Z

Devonian

Zechstein

Triassic

Chalk

Rot 1

2000

2500

3000

msT

WT A25 30/16-9A3Z30/16-2

Rot 3, 4 & 5

0.5 km

Rot 2 O.W.C

W E

Rot 2

Rot 3, 4 & 5

Devonian

Zechstein

Triassic

Chalk

Rot 1

2000

2500

3000

msT

WT A25 30/16-9A3Z30/16-2

Rot 3, 4 & 5

0.5 km0.5 km

Rot 2 O.W.C

W E

Rot 2

Rot 3, 4 & 5

Auk

Auk North

Top Rotliegend Depth Structure Map

Auk North Field Development 12th May 2011 5

Background: Auk Field Production History

• First oil in December 1975

• Initial development focus

was on Zechstein

• Production peaked in May

1977

• Production mechanism is depletion drive with aquifer support

Auk Historical Production

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

Dec-7

5

Dec-7

7

Dec-7

9

Dec-8

1

Dec-8

3

Dec-8

5

Dec-8

7

Dec-8

9

Dec-9

1

Dec-9

3

Dec-9

5

Dec-9

7

Dec-9

9

Dec-0

1

Dec-0

3

Dec-0

5

Dec-0

7

Dec-0

9

Oil P

roduction R

ate

[stb

/d]

0

20

40

60

80

100

120

140

160

Cum

. O

il [M

Mstb

]

Zechstein Rotliegend Conventional Rotliegend Horizontal Cum.Oil.

Rotliegend horizontal wells

transformed Auk after decline in Zechstein

• Normally pressured reservoir with jet pumps and ESP’s used for artificial lift

• Development focus switched to Rotliegend in the 1990’s with application of

horizontal well technology

Auk North Field Development 12th May 2011 6

Background: Geology

ROT2

ROT3

ROT4

ROT5

Ripple laminated & slipface sands

Slipface sands

Slipface sands

Waterlain conglomerates & sands

ROT1 Slumped & waterlainsands

Anhydrite (A06 only)Shales and anhydrite residue

Vuggy dolomite

Kupfercheifer shale

Devonian

ROT2

ROT3

ROT4

ROT5

Ripple laminated & slipface sands

Slipface sands

Slipface sands

Waterlain conglomerates & sands

ROT1 Slumped & waterlainsands

Anhydrite (A06 only)Shales and anhydrite residue

Vuggy dolomite

Kupfercheifer shale

Devonian

Kupferschiefer Shale

~200-400ft

~30ft

Aeolian

Marine

Aeolian

Generalised StratigraphyReservoir Summary

Zechstein

Rotliegend

Lower

Permian

Upper

Permian

~30ft

Devonian

Kupferschiefer Shale

ROT2

ROT1

ROT3

ZECHSTEIN

� Original justification for Auk development

� Leached dolomitised platform carbonates

� Vugs, solution channels and fractures dominate fluid flow

� Erosionally truncated towards the east

� Communication with Rotliegend reservoir below

ROT1

� Dominated by waterlain mass-flow sandstones, probably

reworked dune sands

� Variable reservoir development with some better quality

homogeneous intervals

ROT2

� Dominant oil-bearing interval in the Auk Field

� Aeolian sandstones, with both wind ripple and slipface sands

� Complex heterogeneous system of good quality slipface

sands (linear dune slipface) enclosed within poor quality wind

ripple sands (linear dune plinth and sandsheets)

ROT3

� Dominated by a thick succession of slipface sands

� Best reservoir quality rock in the Rotliegend but predominantly

in the water-leg, with only a small oil leg in the crest of the

field

Auk North Field Development 12th May 2011 7

Background: Rotliegend Depositional Model

Sand flat

Higher wind velocities in upper portions of linear dunes result in winnowed, better sorted sands (reworked wind rippled sands)

(wind ripple sand)

Laterally impersistent slipfaces developed at all levels on flanks of large linear dunes

Small barchanoid dunes on flanks of linear dunes or draa result in

preserved slipfaces even on lower plinths of linear dunes

Patchy preservation of upper reworked wind ripple sand facies

Preservation threshold controlled by angle of climb of dune

Small barchanoid dune field in interdune corridor associated with sand flat and lower plinth areas

Auk North Field Development 12th May 2011 8

Background: Auk Rotliegend Unit 2 Geological Variability

Re-worked Wind Ripple Sand Slipface SandWind Ripple SandUV LightPlain Light

Rotliegend Core Showing Red Stained (Non-Oil Bearing) Wind Rippled Sands and Bleached (Oil-Bearing) Re-worked Wind Ripple and Slipface sands (Coarser Grained and More Permeable Sands)

Rotliegend facies proportions:

• Slipface Sand: 10-15%

• Re-worked Wind Ripple

Sand: 20-30%

• Wind Ripple Sand: approx.

60%

Auk North Field Development 12th May 2011 9

Appraisal: Programme Objectives

• Existing appraisal well data in Auk North insufficient to reduce uncertainty in factors influencing STOIIP:

− Depth of top structure on flank

− Net-to-gross tends

• Existing seismic data unable to be used to map net-to-gross trends

• Recognised that several well penetrations would be required to reduce the uncertainty in the STOIIP

• Appraisal programme consisted of:

− Vertical well with deviated side-track (30/16-

15/15Z)

− Vertical well with deviated side-track and

horizontal side-track (30/16-16/16Z/16Y)

• Appraisal wells drilled between September 2007 and February 2008

30/16-15Z

30/16-16

30/16-16Z

30/16-16Y

Zechstein

Triassic

Chalk

Rot 2/3/4

Devonian

12 13Z 13 15Z 15WSW ENE

2000

2500

ms

TW

T

1 km3000

Zechstein

Triassic

Chalk

Rot 2/3/4

Devonian

12 13Z 13 15Z 15WSW ENE

2000

2500

ms

TW

T

1 km1 km3000

LINE OF SECTION

30/16-15

Top Rotliegend Depth Structure Map

Auk North Field Development 12th May 2011 10

Appraisal: Well Results

• Results incorporated into geological model

• Revised range of STOIIP indicated that there was sufficient volume in place to

warrant development of Auk North

30/16-16Y30/16-15 30/16-15Z 30/16-1630/16-16Z

Rotliegend

Rot 3

Wind Ripple

Re-worked

Slipface

?

Auk North Field Development 12th May 2011 11

Development Concept

Production Pipeline

ESP Power Cable

EH/CI Umbilical

Production Pipeline

ESP Power Cable

EH/CI Umbilical

Subsea Manifold and

Wells

Subsea Manifold and

Wells

Fulmar Riser

Fulmar Riser

Fulmar Topsides Facilities

Fulmar Topsides Facilities

• Three options were considered for the development of Auk North:

− Extended reach drilling from the Auk platform

− Subsea wells drilled from a mobile rig tied back to the Auk platform

− Subsea wells drilled from a mobile rig tied back to the Fulmar platform

• On the basis of feasibility and cost the option selected was a subsea tie-back to the Fulmar platform with ESPs being used as the means of artificial lift

Auk North Field Development 12th May 2011 12

Field Determination

• Auk field subject to Petroleum Revenue Tax (PRT)

• The Auk North project under a PRT paying environment would not be sanctioned as it would not meet Talisman's economic criteria to achieve project sanction

• However, the project would meet Talisman’s economic criteria to achieve project sanction if the Auk North development area was determined to be a new field and therefore not subject to PRT

• Talisman liaised closely with DECC and HM Treasury to demonstrate that this was the case:

− Open discussion on Talisman’s economic criteria required to sanction projects

• Auk North project sanctioned by Talisman Board in October 2008, conditional on Auk North being determined as a new field and therefore not subject to PRT

• Auk North determined as a new, separate field in January 2009:

− Re-determination of oil field boundaries on economic grounds (document issued November 2008)

• Development consent for the Auk North field received in January 2009

Platform

Auk North

Auk

Auk South

Top Rotliegend Depth Structure Map

New Auk North Field

Determination (and

Development) Area

Revised Auk Field

Determination (and

Development) Area

Auk North Field Development 12th May 2011 13

Project Execution: Drilling

• Three development wells drilled and completed between January 2009 and August 2009 and between September 2010 and November 2010

• Issues during drilling:

− Losses incurred while drilling the reservoir section of well N1 after encountering an area of intersecting faults

− Well paths of subsequent wells revised to avoid areas where faults intersect (identified using seismic attribute data)

N3A N1 N2

Wind Ripple

Re-worked

Slipface

Rot 1

Rot 1

Rot 2

Top Rotliegend Depth Structure Map

Zechstein Edge

N4ZN4

N3A

N1

N2

Auk North Field Development 12th May 2011 14

Project Execution: Completion

• Lower completion:− Sand screens and swell packers in reservoir section

• Upper completion:− Dual ESPs:

� 684 hp motor

� 140 stage centrifugal pump

� Non-return valve to prevent back-flow through pump

� Separate cables to surface for each pump

− Use of subsea horizontal tree necessitated new penetrator design for cables through the tubing hanger that still provided a dual barrier

• Expected completion run life of four years

• Key challenge was sizing pump to cater for a wide range of well productivities

ESP Pump Curves - FBHP versus Rate

P.I. = 40

P.I. = 15

P.I. = 3.5

P.I. = 2P.I. = 1P100 SXD

63 P100 SXD max. freq.

0

500

1000

1500

2000

2500

3000

3500

4000

0 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000 11000 12000 13000 14000 15000

Liquid Rate [stb/d]

FB

HP

[p

si]

ESP Packer

Y-Tool

Non-Return Valve (NRV)

Monitoring Discharge Unit

Pump

Seal

Motor

ESP Monitoring Gauge

Pump Support sub

Bypass Isolation Plug

Perforated pipe

Sump or liner top packer / PBR

Auk North Field Development 12th May 2011 15

Project Execution: Well Results

Auk North Development Well PBU Log/Log Plot

0.001

0.01

0.1

1

0.001 0.01 0.1 1 10 100

Elapsed Time (hours)

Delt

a P

/Delt

a Q

(p

si/

b/d

)

N1 pressure

N1 derivative

N2 pressure

N2 derivative

N3A pressure

N3A derivative

Auk North Development Well Transient P.I.

0

10

20

30

40

50

60

70

80

90

100

0 5 10 15 20 25 30 35 40

Time (hours)

P.I

. (s

tb/d

/psi)

N1 Transient P.I.

N2 Transient P.I.

N3A Transient P.I.

Auk North Field Development 12th May 2011 16

Project Execution: Topsides and Subsea Facilities

• Subsea manifold:

− Designed for three wells with tie-in for future expansion

• Subsea pipeline:− Eight inch diameter and 10.5 km long

− Insulated to a U value of 4 W/M2k

• Electro-hydraulic/chemical injection subsea controls umbilical and an ESP power cable

• Conductor riser:− Containing two risers and two J-tubes

− Installed in redundant well slot

• Process facilities:− Utilised existing ‘B’ train 1st stage separator

− Methanol and wax inhibitor injection system

− Modules containing variable speed drives (VSDs) for ESPs

• Work on installing the topsides and subsea facilities took place between January 2009 and November 2010

Auk North Field Development 12th May 2011 17

Current Status

• First oil occurred on 17th November 2010

• Peak oil production rate in excess of

20,000 stb/d

• The results of the initial phase of the

project has resulted in a fourth

development well being sanctioned

• Well N4/N4Z spudded on 21st March 2011

• Currently running lower completion

Top Rotliegend Depth Structure Map

Zechstein Edge

N4ZN4

N3A

N1

N2

Auk North Field Development 12th May 2011 18

Summary

• Auk North began production in November 2010, some eighteen years after initial appraisal

• The appraisal programme carried out in 2007-2008 showed that there was sufficient volume in place to warrant development of Auk North

• However, the development costs meant that the project had marginal economics in a PRT paying environment

• Talisman liaised closely with DECC and HM Treasury to facilitate the development of Auk North – this was achieved by having Auk North being determined as a new field and therefore not subject to PRT

• The success of the initial phase of the project has resulted in a fourth development well being sanctioned