Economic Benefits Of Subsea Flexible Flowlines
Authors: Hill R.T. , Measamer J.C. 
Published: October 2008

The development of marginal off-shore hydrocarbon deposits has resulted in production of increasingly corrosive fluids, thus furthering the need for pipelines capable of operating at elevated temperatures in the presence of high concentrations of H2S and C02 gases. Conventional pipelines require the use of stainless steels or other corrosion resistant alloys which drives up the cost of materials and fabrication/installation of the system. The use of Flexible pipe is assuming an important role in these applications where the selection of compatible metallic and non-metallic components have resulted in cost effective alternatives.

As development of marginal and aggressive hydrocarbon resevoirs increases operators are faced with providing systems which minimize the cost of field production. This paper describes the results of economic analyses of actual field developments in order to provide a methodology for selection of an appropriate pipeline technology to minimize life cycle costs of the flowline system.

Introduction

Recent exploration and production activities throughout the world have shown the need to develop production systems for use in both marginal fields and in production of aggressive fluids. In order to minimize development costs operators must make use of life cycle costing techniques; requiring knowledge of the expected field life and production fluids as well as knowledge of available technical solutions. The decision on how to develop a particular field are influenced by many factors including:Length of flowlineField development plan (floating Production system or fixed platform).TopographyWater depthConveyed fluid temperature and contentPresence of corrosive fluids and gasesAvailability of installation and support vesselsLength of time required for installationUseful field life

Exploitation of fields with a limited production life will lead operators to examine the costs of installation and removal of the flowline system and the ability to re-use equipment in future developments. Production of aggressive fluids has led to an increasing use of costly clad or corrosion resistant alloy (CRA) pipes. This has a significant impact on rigid pipe costs, particularly during conventional installation, whereas in flexible pipes the use of type 316L stainless steel or CRA for the inner structural component, Carcass, coupled with an inert polymer fluid barrier layer will not have as great an effect on the overall flowline cost.

Life Cycle Costing Approach

Life cycle costing (LCC) is used to compare different methods of performing a given task. In developing flowline systems consideration must be given. to the acquisition and installation costs as well as annual operating costs for each type of system, decommissioning costs and any salvage or residual value when the field is abandoned. This method also allows you to vary the interest rate and inflation value for each period of time. LCC calculation methods are shown in figure 1.

In general when interest rates are extremely high, or the design life is short (2 years or less), LCC will tend to favor low capital investment such as use of carbon steel Iinepipe.