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Andrew Gould - what the North Sea needs now

Thursday, October 17, 2013

More specialist oil companies, varying tax regimes, reducing costs, unmanned platforms, more HP/HT components, increase in recovery from subsea wells and a subsea power grid - some predictions of what we will see in the North Sea from Andrew Gould

Andrew Gould, a former CEO of Schlumberger and current chairman of BG Group, said that we are likely to see more oil companies specialising in specific types of production, such as heavy oil, speaking in the plenary conference session of Offshore Europe in Aberdeen on September 8.

There will also need to be more variety in tax regimes - so for example mature basins will be given lower tax rates, he said.

The North Sea needs to find ways to reduce costs, he said. ''The North Sea has always been a very high cost basin - but the North Sea has a lot of competition [for investment] from other parts of the world. It must achieve a step change in the cost of exploitation,'' he said.

The UK has not developed a home grown oilfield service capacity, he said - with the largest oilfield service companies coming from the US.

Whilst management of safety in the North Sea is almost unique, there is still a need to reduce the number of people working offshore, through use of technology, he said.

We should also see more unmanned platforms. If it will be possible to have driverless car in 2020, as many people predict, then it should be possible to have a remotely operated production platform - since there are surely more variables involved in driving a car.

''Remote management allows for much more effective use of [human] resources,'' he said, if it enables people to work on projects concurrently). All these technologies exist, the issue is implementation.''

Another area worth investment is improving recovery factor from fields with subsea well heads. ''The recovery factor from subsea is known to be lower than dry wells,'' he said. ''Intervention on subsea well heads will remain more expensive than platform intervention.''

On high pressure, high temperature fields, ''technology will be needed to make the risk and cost of these fields acceptable,'' he said. ''Gulf of Mexico has high pressure wells without temperature/ Thailand has high temperature without pressure.''

''The problem of stress and compaction from reservoir production are not well understood,'' he said.

''Electronics in logging tools are not sufficiently robust. We need sealed multichip modules used in space and aeronautics. We will need game changers in materials science and electronics. North Sea has a chance to lead.''

Another useful investment would be a subsea power grid, providing electrical power to subsea equipment. ''It can reduce overall economics with oil and gas production,'' he said.

''The nature of the business is changing. If we succeed we need to recognise we have to be innovative.''



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