INDUSTRY FACES WORST EVER OIL FIRES IN KUWAIT

Industry is preparing to come to grips with the enormity of dealing with history's worst oil field fires in Kuwait.

Latest reports are that every Kuwaiti oil well has been damaged, and perhaps more than 800 wells are ablaze. Kuwait has about that many wells producing out of a total 1,386 wells, if its portion of the Neutral Zone is included (OGJ Backgrounder, Mar. 4, p. 21).

All five of the world's wild well control specialists are enroute to or preparing to depart for Kuwait.

Safety Boss Ltd., Calgary, has signed contracts to provide well control specialists to Kuwait. Safety Boss will send two teams and $2 million in equipment. The company said it expects Kuwaiti authorities may ask for additional firefighters later.

Also helping to combat Kuwaiti well fires are Houston area firms Red Adair Co. Inc., Boots & Coots Inc., Wild Well Control Inc., and Cudd Pressure Control Inc.

Meantime, officials are offering sobering assessments that full restoration of Kuwait's oil production capacity may be years away.

CHENEY'S VIEW

U.S. Defense Sec. Dick Cheney says the U.S. did not set out to destroy the Iraqi petroleum industry in the war to eject Iraq from Kuwait.

He said the goal was to shut down refineries and their ability to produce fuel for the Iraqi military machine.

"We targeted critical nodes such as a cracking tower. We left the rest of the system complete and relatively untouched. They've got to go back and do a lot of work to replace the parts we took out, but the Iraqi petroleum industry is in far better shape than (the Iraqis) left the Kuwaiti petroleum industry."

Cheney said restoring the Kuwaiti petroleum industry will take time.

"It's a very dangerous kind of environment to operate in. There are a lot of unexploded ordnance in the oil fields and a lot of booby traps. That requires great caution. It's going to take a number of years before Kuwait is back to the level of production they were before the war started."

KOC DAMAGE REPORT

After a visit to Kuwaiti oil fields, Kuwait Oil Go. executive Musab al Yaseen said every well was damaged.

Wells that had not caught fire had been damaged by Iraqi explosives and were leaking crude. Yaseen said as many as 34 wells were destroyed by allied bombing, but most of the total wells on fire were blown up by Iraqis. He said most wells had been wired with explosives shortly after the invasion last August but not detonated until a week before Kuwait's liberation.

Allied bombing also damaged 13 of 18 gathering stations, Yaseen said. Storage tanks that had not been set afire hold about 16 days of production, which will be used for domestic consumption.

But the company declined to speculate on when Kuwait will be able to resume oil production or exports.

KOC's superintendent of budget and costs said getting oil and gas supplies to the domestic market will be the top priority.

Another KOC executive, Bader al-Khashti, said repairs to tank farms and work on snuffing out well fires cannot begin until mines and booby traps are removed.

KOC'S PLANS

KOC will lay a 30 mile pipeline from the Persian Gulf to Burgan and Magwa oil fields to provide cooling water for well control specialists expected to arrive in Kuwait shortly.

But before work on the line can begin, mines, unexploded bombs, and oil field debris must be cleared from the route.

KOC planned the water line during the buildup to the land war as a precaution against widespread sabotage threatened by Iraqis.

Pipe was ordered and stocked in Saudi Arabia and provision made for early delivery to Kuwait of the required pumping equipment.

As part of the well control program, KOC also ordered a complete construction camp to house 1,200 persons. This is stockpiled in Saudi Arabia, again awaiting word from the company that a safe site has been cleared where the camp can be installed.

KOC officials who accompanied a BBC correspondent on a visit to Burgan and Magwa fields immediately after the liberation said every producing well appeared to be burning.

The state owned company repeated that its first objective after bringing the fires under control is to get at least 130,000 b/d of oil flowing to meet domestic requirements. Before this can be done, repairs also must be made to extensive gathering systems in Burgan and Magwa fields. Thirteen of the 26 gathering stations are reported to be severely damaged. Shipping facilities also are badly damaged.

All fires at refinery tank farms are reported to have been extinguished or burned themselves out.

KOC said that the Iraqis did more damage before moving out.

However, there are hopes basic refining capacity will be available to coincide with start-up of Kuwaiti production.

There is still no clear picture of how long it will take to get oil flowing again. After the first inspection, onsite KOC sources speculated that getting enough crude to meet local requirements might take only months and that within 6 months limited exports might begin.

However, KOC sources in London have said it could take 1 year to reach that stage, and the government in exile in Saudi Arabia speculated it might take 9 months to get the first wells on stream.

CONSULTANT'S ASSESSMENT

A Norman, Okla., oil consultant estimates financial losses from lost production resulting from Kuwaiti oil well fires may reach $36 billion.

Further, it could take 12-36 months to control all wells currently ablaze there, contends Henry Crichlow, a former Oklahoma University petroleum engineering professor and founder of the U.S. Geological Survey certified oil well blowout control systems school at O.U.

Citing press reports and a KOC source estimate of more than 800 wells burning in Kuwait, Crichlow developed a computer model to develop an optimum sequence for controlling the burning wells.

He points to these critical factors:

Only 25 oil well firefighting crews are available worldwide: Cudd 7, Wildwell Control 6, Red Adair 5, Boots & Coots 5, and Safety Boss 2.
Uncontrolled flow of some of the wells can be 5,000-90,000 b/d with a typical well being 10,000-15,000 b/d. Gas:oil ratios are 500-15,000:1.
Kuwait's reserves are a little less than 100 billion bbl, second or third in the world behind Saudi Arabia and Iraq.
Some Kuwaiti reservoirs have a water drive.
Some of the reservoirs are susceptible to water coning from edge aquifers.
Structural positions of various wells vary considerably, with faulting and facies changes occurring laterally throughout reservoirs, determining differences in production rates and reserves.

With 800 wells flowing wide open, Crichlow estimates lost oil flow at 15.5 million b/d of oil equivalent, or a loss of $300 million/day at current prices. Thus, the fires consume 1 billion bbl, or 1% of total Kuwaiti proved reserves every 2 months.

WELL CONTROL PRIORITIES

A key concern is determining which wells to bypass temporarily and which to target first, Crichlow said. More destructive than the burning of crude is the effect on the reservoir of a long term blowout, he contends.

Reservoir damage due to water coning, gas migration, relative permeability reduction, and other irreversible petrophysical effects will worsen if adequate control is not implemented promptly.

Crichlow recommends the use of "sacrificial engineering," a statistical technique contemplating time value of resources to determine which wells to sacrifice and which wells to save.

"To handle this situation," Crichlow said, "all known parameters have to be sensibly extrapolated far beyond any historical limits known to the oil industry. We must have a combined strategic and tactical approach like never before seen to adequately resolve this intractable situation."

What's required, says Crichlow, is the combined experience of reservoir engineers, production engineers, drilling engineers, and system analysts to provide a strategic command and control to focus firefighters on critical wells.