Shifting the Cost Curve for Subsea Developments
Authors: Solheim B.J. , Hestad E. 
Published: October 2008

A steadily increasing challenge in offshore oil and gas field developments in the Norwegian part of the North Sea is to design, construct, and install offshore installations that give an acceptable return of investment. Deeper water limited reservoirs and a low, fluctuating oil price make the task even more demanding..

Saga Petroleum has recently faced this challenge with ifs last field development project. Attention in this paper is focused on the Vigdis subsea production system. However the considerations and cost reduction elements are valid for offshore field developments in general.

The main cost reductions are obtained by:Maximum use of industry capabilityApplication of new organisation principlesFocus on functional requirementsShortened poject execution timeTechnological development

In addition this paper presents thoughts on further cost reduction possibilities for future subsea field developments.

INTRODUCTION

Oil production on the Norwegian shelf started with four subsea wells on Ekofisk connected to a modified jack-updrilling vessel in 1971.

Several years elapsed before the next subsea production system was put into operation in Norwegian waters. These were years when oil prices were comfortable and subsea technology was in its early adolescence. Steel or concrete platform concepts were dominating offshore field developments in the North Sea. Today these installations provide valuableinfrastructures for new field developments using subsea production systems.

Since 1983 an increasing number of subsea production systems have been put into operation in the North Sea. At the present time a total often different systemsoperated by five oil companies are producing oil and gas from the Norwegian shelf, and several new ones are planned.

Saga Petroleum, although one of the youngest operating oil companies in the North Sea, already has two subsea production systems in operation, Snorre and Tordis which came on stream in 1993 and 1994, respectively. Saga Petroleum is actively pursuing several new field developments with subsea production systems, and Vigdis as the next one will start production in 1997. Subsea production systems have undergone a dramatic development during the last ten years, from late adolescence with more or less prototype developments in 1983 with quite a bit of new technology, to a stage where the systems are now approaching mature industrial products.

The way in which subsea field developments have progressed from early feasibility studies to installation and operation has followed the same patient and has been almost unchanged during the last ten years. However, to face the steadily increasing challenge of depleting smaller reservoirs in deeper water, with a lowoil price, the oil companies and Saga Petroleum in particular, have been forced to focus attention on a reduction of investment cost and project execution time while at the same time maintaining safety and reliability. The following is a description of how, in the Vigdis project, Saga Petroleum improved on the traditional manner of executing subsea production system projects, making it more efficient and simultaneously tookadvantage of the fact that the industry now has developed the systems toward mature industrial products.