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Beyond ROP: Industry taking systems view to drilling optimization

Interpretation of downhole data is a key focus at Weatherford, which recently established a global Drilling Engineering and Optimization group to ensure consistency and best drilling practices in addressing downhole issues, such as torque-and-drag and stuck pipe. Improvements in sensors to capture high-frequency downhole data have enabled the industry to move from recording one data point every five seconds to 1,000 samples per second.

Optimized drilling once meant drilling farther and faster to achieve high rates of penetration (ROP) using efficient, cutting-edge technologies and approaches like pad drilling. Today, with oil prices remaining low, that need for speed has given way to a more balanced approach, with operators taking a step back and a wider view of downhole drilling optimization.

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Global oil slump puts Africa’s drilling potential on hold

The Ensco DS-8 is contracted to Total until November 2020 for operations in Angola. Total expects to decrease its rig count in Africa from 12 in 2015 to fewer than 10 in 2016.

Although significant potential remains for increased drilling activity in Africa, the global oil price slump has left this market stagnant for now. Exploration activity throughout the continent was largely on hiatus in 2015, and if oil prices remain low through 2016, this trend is almost certain to continue. The drop in exploration activity is a result of reactionary budget cuts, as operator profit margins have become increasingly strained due to the still-falling oil prices. Such was the case for Total, an operator that spends a third of its total investments on the African continent. “The impact of the low-priced oil environment currently is that we have started the project of strong cuts and reduction of costs,” Benoît Ludot, Vice President Drilling & Completion for Total Exploration-Production, said.

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2016 Chairman: IADC to sustain engagement with public, regulators

In recent years, Rowan has expanded into the ultra-deepwater sector with the construction of four state-of-the-art drillships, including the  Rowan Resolute.

When someone graduates with a DPhil (PhD) from the University of Oxford, a typical career choice might be to go into academia, or perhaps a research institute. But Tom Burke is not a typical guy making typical career choices. Instead of following such traditional paths, he decided to go offshore and work on drilling rigs. He didn’t have family in the business, and the year was 1994 – a difficult time in the drilling industry.

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Raising the sand bar

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In virtually every well worldwide, operators have to contend with some degree of sand production, a phenomenon that more often than not leads to erosion, sand accumulation, plugging, formation collapse and contamination. These issues have serious financial, safety and environmental implications for operators, often resulting in clean-outs, reduced flow rates and production, and unplanned shutdowns.

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Dayrates are down, but rig count remains steady in Middle East

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While a downward trend in activity and rig count has been observed around the world in response to the oil price slump, the Middle East appears to be bucking this trend. According to numbers from Baker Hughes, the Middle East’s rig count has averaged 404 to date in 2015. That’s nearly the same as the region’s average rig count of 406 in 2014 and up from an average of 372 rigs in 2013.

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Pressures mount as industry goes deep into survival mode

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The upstream oil and gas industry has gone into survival mode, and analysts appear to agree that things are going to get worse before they get better. With low and volatile oil prices leading to more and more postponed drilling projects and lower and lower rig counts, operators, drilling contractors and service companies alike are cutting costs wherever possible. However, it’s the drilling contractors and service companies that have bore the brunt of these reductions, and analysts are urging the industry to increase collaboration to reduce costs in a balanced manner.

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Geopolitical concerns cloud short-term global oil forecasts

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Geopolitical developments, including China’s economic slowdown, the Iran nuclear deal and the potential lifting of the US ban on crude exports, will likely continue to be factors that prevent the oil price from recovering significantly in 2016. The effect these developments will have on the global oil supply and demand balance is unclear, which only adds more uncertainty to an already unpredictable market. “The level of volatility has increased substantially,” said Sam Ori, Executive Director of the Energy Policy Institute at the University of Chicago (EPIC). “That’s being driven by real uncertainty in the fundamentals of the oil market.”

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Despite challenges, lure of Latin America too strong to ignore

Despite the abundance of potential resources in Latin America, the region has not been immune to the global market downturn. EIA data shows that onshore and offshore rig counts combined have fallen from 398 a year ago to 314 in June. In Brazil specifically, the offshore rig count has fallen from 84 in July 2013 to 52 in July 2015. Argentina has been more stable than some of its neighbors – its rig count has only decreased by two, from 107 to 105, according to EIA data.

In 2014, an investigation by the Brazilian federal police, dubbed Operation Car Wash, raised suspicions that several politically appointed Petrobras executives had been accepting bribes in exchange for offering construction and engineering companies inflated contracts. Portions of these ill-gotten gains were allegedly paid to politicians and their political campaigns.

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A seismic shift in the subsurface

Technology developed by MicroSeismic Inc uses microseismic data to determine what proportion of the total stimulated reservoir (or rock) volume (SRV) has been propped and will likely be productive. It shows operators where the proppant went during fracturing. This microseismic-based discrete fracture network analysis shows SRV in red and productive SRV in blue/purple. The red areas are those that were fractured but have no proppant. The blue and purple sections are areas where fractures have been created and have proppant.

In the 15 or so years since the unconventional oil and gas boom began, the industry has learned that unlocking the secrets of the subsurface is the key to tapping additional resources. Operators now know that the complexity, heterogeneity and unpredictability of unconventional plays and tight oil and gas formations require a deeper characterization of the geology and an understanding of the effects of hydraulic fracturing on the rock. Today, models can provide a 3D view of the formation and simulate hydraulic fractures, with the capability of making real-time adjustments. They have become essential in designing completion strategies that enhance production. A pivotal piece of that process involves listening to the rock and detecting subsurface stress – microseismic monitoring.

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