SEISMIC WORK IN THE NORTH SEA: RAISING QUALITY, CONTROLLING COSTS

Ian Jack
BP Exploration Operating Co. Ltd.
London

The industry is going through a period of major change.

Change usually occurs either due to advances in technology or due to external pressures such as time or financial constraints, legislation, etc., or voluntarily-in response to a strong vision or desire to control one's direction or destiny.

In BP right now, all three of those factors are strongly active. In terms of our seismic work, financial pressures probably dominate, and I will return to this point after a brief mention of some of our other pressing problems.

PROBLEM AREAS

Firstly, safety. We think our standards are improving (although logging of lost-time incidents is by no means consistent in the industry), but we continue to suffer occasional serious injury and even fatality on our seismic work.

Studying the facts from some recent incidents, I am struck by the failure to have or to follow simple procedures and systems designed to avoid the situations which arose. Management has been primarily at fault in these incidents.

Secondly, environment. I have been telling equipment suppliers that we need equipment which is one-tenth the weight and one-tenth the cost of existing gear and is biodegradable, and that I am only half-joking about the latter.

The environmental damage that we would inflict on some areas (and the cost of making good) for line-cutting, helicopter clearings, etc., especially for intensive 3D surveys is very heavy and needs to be reduced.

If we are to work successfully and responsibly in existing and in new areas then we must improve our performance both in safety and the environment.

Thirdly, time. We have seen 3D surveys cancelled or deferred purely due to our failure as an industry to acquire and process 3D data in a time frame which satisfies the customer--the asset or exploration manager.

In one area we have a $12 million 2D program running instead of a $40 million 3D program for just this reason, and the problem applies to both land and marine work. In the marine case, contractors are making substantial efforts in this direction, and their technical advances will eventually effect a reasonable improvement.

Lastly, cost. The financial pressures throughout the industry are very high, and we are all having to examine every possible avenue of cost reduction. So we are assessing very carefully our steering of, our development of, and our use of technology; our relationships with suppliers; and the ways in which we do our work to find cheaper and better ways.

VISIONS OF QUALITY

I know also that we have to improve the technical standard of our products while simultaneously reducing the cost.

The visions of quality-especially technical quality-are very clear, and there is no doubt that high quality 3D surveys are the way forward. The challenge we face is being able to implement this vision while driving our costs down and down, and being able to promote and maintain a good visibility on the value added.

An examination of seismic economics in the North Sea shows what might be accomplished.

Fig. 1 shows where the time goes during a typical, linear, North Sea 3D survey. I will restrict this discussion to linear surveys, recognizing that there are other viewpoints.

Clearly, these surveys are inefficient. Why?

Surveys are too small for efficiency. Time spent actually shooting data is matched by the line-change time.
There are too many boats in the North Sea so we incur interference downtime.
Equipment is not yet reliable enough, so we spend time on repairs and maintenance.
We don't bunker at sea so we incur too much port call time.
There are too many small surveys for different clients, which adds to the port call problem.
We could tow a wider swathe of gear, thus reducing the number of passes per kilometer in the cross-survey direction.
We have problems scheduling the boats to keep them working efficiently throughout the year.
The North Sea licensing conditions are not conducive to merging small surveys into big ones-we can't shoot across someone else's acreage, and the requirement to dispense courtesy data complicates our lives.
Many of these problems are oil company problems.

The result of all these factors is evident in Fig. 2, which shows the cost per square kilometer of all our recent North Sea 3D surveys plus some others we are aware of. These figures include data acquisition and associated costs such as positioning and quality control.

HOW CHEAP?

How cheap could seismic be (Fig. 3)?

We appreciate and concur with the need for contractors to provide good, safe working platforms and to replenish their fleets. We appreciate and support the quality of the new seismic vessels being floated today, and we appreciate that these vessels cost in the region of $30-40 million.

Financing one of these at, say, 9% over 10 years will cost $506,000/month, every month.

Running costs inclusive of salaries, fuel at 15 metric tons/day, disposables, spares, and maintenance will be in the region of $715,000/month, every month. This allows for reasonable shore support but does not include a research and development overhead.

We would like the contractor to make a healthy profit, so I have added 25% to the figures in this analysis, per month, while realizing that interpretations of "healthy" may vary.

This totals some $1.52 million/month.

If we could just execute larger surveys without interference, we could shoot two vessel-lines each of, say, 50 km in a day. If we could tow a subsurface swathe of 200 m width, and if we could banker it sea, then we would shoot 600 sq km/month in the season.

We nearly can tow a 200 m width; in fact, some will say they already can. But I will add here an additional $525,000/month for outrider vessels to tow additional streamers. The vessel cost is thus some $24.5 million/year.

If we could record our 600 sq km/month for 10 months in the year, while paying for the boat for the full 12 months, then our seismic would cost about $4,000/sq km instead of about four times that figure.

This, of course, depends very heavily on the oil companies' cooperating with each other to ensure continuity of the vessels' work both in summer and in winter.

It may require us to help the contractors plan their winter work further ahead.

It requires us to plan differently and to think differently.

It probably requires us to eliminate courtesy data and to relax some of the privileges that our licenses give us.

Overall, it requires us to plan more effectively.

A COROLLARY

An interesting corollary is to calculate that since the entire licensed acreage in the U.K. continental shelf amounts to some 100,000 sq km then at 600 sq km/month it would take 167 vessel-months to shoot the entire amount with high quality 3D seismic coverage.

If each boat worked only 6 months in the year, then this would take 26 vessels 1 year to shoot.

Of course, due to interference, it would be ridiculous to try to shoot all of the U.K. continental shelf with 26 vessels, but maybe six to seven vessels could do it in 4-5 years, or nine to 10 vessels if we include Norway's licensed acreage.

That's about a quarter of the number of vessels in the North Sea this year.

If seismic were as cheap as $4,000/sq km, would that stimulate the market?

It would almost certainly enable the industry to realize additional value cost-effectively in existing blocks.

Already, we see a trend toward reshooting surveys which are about 10 years old, and we reprocess maybe once every 5 years, both activities being due to the steady march of technology. So there is an argument for a continuous reshoot of prospective marine acreage.

And, if the technology were to be improved to give a more consistent product, we might see a much greater use of reservoir monitoring.

There are opportunities here for oil companies, contractors, and data brokers. But we will all have to work together to achieve "best practice."