Mathematical Models To Help Manage The Oil Resources Of Kuwait
Authors: Ali H.M. , Beasley J.F. , Batchilor A.S.J. , Beale E.M.L. 
Published: December 2007

We describe four models used by the management of the Kuwait Oil Company for planning long term investment and in daily operations. They include two optimization models for daily operations, an optimization of long term capital investment and reservoir depletion and a simulation of the tank farms and port. Their usefulness and importance can be inferred from their continued use and development.

Introduction

This paper describes the development and use of four mathematical models that help the management of the Kuwait Oil Company with problems ranging from day-today operations through medium term planning to long term strategy.

When work on these models began in the mid 1960s, the Kuwait Oil Company's production capacity in Kuwait had reached 3 million barrels per day. The level to which further development per day. The level to which further development could be undertaken was of some interest at that time. The development of further capacity, or the maintenance of any given level of capacity, presented considerable planning problems. There presented considerable planning problems. There were some 20 producing reservoirs, with widely varying producing mechanisms and varying oil characteristics, which complicate the long term development and day to day management problems. Gas utilization was growing, and a start had been made in the production of LPG from the field gases and its export in bulk cargoes. This presented particular difficulties because all the gas is solution gas produced in association with crude oil.

As nearly all the oil is exported by sea, the pronounced trend to larger tanker sizes accentuated the problems of dealing with a fluctuating crude oil offtake.

In 1965 an association began between the Kuwait Oil Company and Scicon (the company whose full name is Scientific Control Systems Ltd. but which was then known as C-E-I-R Ltd.). This association has continued, and led to the development of a family of planning and control models. Most of these models are run on computers in Kuwait, although some long-term planning models are run on a Univac 1108 in England.

The first joint development was a model to specify a schedule of wells to use in meeting a given daily total production rate. The schedule has to operate within the capacity limits of the plant, produce oil of the right quality, satisfy demands on the various gas streams, and optimize liquid gas production while attempting to meet reservoir engineering requirements. This is a natural application of linear programming, once the criteria for assessing the relative merits of different solutions are defined more precisely than in the above informal description of the problem. After several prototype models had been tested, the Selective Production Scheduling (SPS) Model was developed, and has been used successfully since 1967. While this model takes account of reservoir engineering requirements, it is essentially a short-term model that cannot investigate the long-term effects of different schedules. So other studies were begun at this time. These included studies of the oil storage and export facilities, as well as methods for planning long term investment in production facilities. production facilities. With the port, the main difficulties are with planning its operation in an environment dependent on uncertain events such as weather and irregular ship arrivals, interacting with more predictable events such as tides and variations in the demand for crude. A detailed computer simulation was therefore made, allowing for these things.