Resilience Through Commodity Cycles – Techno-Economic Optioneering to Enable Robust Development Planning

Abstract An optimized workflow was undertaken to inform the optimal field development plan (FDP) of a representative complex, liquids rich unconventional gas field comprising four resource windows. Three alternative field development options were studied, coupled with two alternative disposition arrangements for associated condensate. Key objectives of the workflow were to deliver an economically robust project with a low sales gas break-even price, strong cash flows, and optimized to avoid fixed capital assets with poor capacity utilization. Extensive economic evaluation was undertaken utilizing in-house tools to evaluate the three field development strategies and two condensate disposition options. A typical unconventional gas field can have a number of distinctive fluid windows ranging from lean gas to liquid-rich areas, complicating the development strategy. The field development start-up strategies examined include leading with lean gas, leading with rich gas, and leading with a hybrid strategy. Thorough assessment of expected production profiles from all three start-up strategies were completed to evaluate the impact on project feasibility and attractiveness. The two condensate disposition options examined include (1) investing capital to upgrade an existing facility network for export, and (2) blending condensate with crude. The workflow delivered clear visibility on the preferred field development strategy though the key target economic metric, the gas breakeven price. The study also provided an understanding on relationship and dependency factors of various key economic metrics. This workflow is aimed at supporting decision-making by providing clear visibility on value creation in multiple development strategies. Common economic parameters and assumptions were applied to all strategies and sensitivities to ensure a like-to-like comparison of results. Risk mitigation was also considered in determining the preferred development option, as the preferred option showed the lowest risk with the best economic outcome. The study concluded that rich gas and hybrid start up strategies yield improved economics compared to a lean gas start-up option. The hybrid start-up strategy significantly improved the project's ability to ramp-up and manage sub-surface risk while also optimizing investment and realizing the financial benefit from higher liquids production. The study also established a clear relationship between gas breakeven prices and upfront capital investment required in both the hybrid and liquid-rich start-up cases with a condensate export option. Multi development strategy analysis requires comprehensive economic workflow that supports the decision-making process. In most capital-intensive resource projects, the primary objective is to select the development scheme which provides the best return on capital investment for a given level of risk. Having a well-established economic evaluation workflow enables companies to complete economic evaluations both effectively and efficiently