Well Planning: A Risk-Management Process
Authors: Denney Dennis 
Published: February 2015

This article, written by Senior Technology Editor Dennis Denney, contains highlights of paper SPE 156332, ’Well Planning: A Risk-Management Process,’ by Charles Dudley McManus, SPE, Patrick Leach, SPE, Paul Wicker, SPE, and Steve Anderson, Decision Strategies, prepared for the 2012 SPE Deepwater Drilling and Completions Conference, Galveston, Texas, 20-21 June. The paper has not been peer reviewed.
Technology limits are pushed to meet the challenge of the ever-increasing demand to drill deeper wells in deeper water. Drilling professionals have a wealth of experience in deep water and in the more-traditional depths that provides an intuitive framework and a rich data set for probability assessment of what might be encountered. By tapping this database of expertise and knowledge appropriately and by use of proven risk-analysis techniques, teams can work through issues and gain a better understanding of objectives, risks, and uncertainties. Thereby, the team frequently can mitigate risks and move forward, making more-confident decisions.
Introduction
With drilling and completion costs accounting for nearly two-thirds of the capital expenditure on some projects, errors in cost and timing estimates can have a significant effect on project economics. Having few analogous wells and limited data, the perception biases of the drilling team, whether pessimistic or optimistic, might distort the ranges of uncertainties used. Technology has enabled much deeper drilling with extended reach, but the experience level and available data are quite sparse. At the same time, the costs, time frame, and risks have increased dramatically for such drilling projects. The complexity of deeper, riskier projects coupled with many critical uncertainties can require teams and companies to make a complex set of decisions.
Drilling-Solution Approach
The key objectives of this drilling-solution and risk-management approach are:
Improve safety and gain clarity about potential catastrophes, with an explicit understanding of the potential cause, effect, and mitigation plan for each.
Model well failures that result from explicit risks, recognizing that several attempts may be required to reach total depth (TD).
Generate realistic ranges of cost and timing, with estimates with consistent confidence levels.
Develop risk-mitigation plans and prioritize efforts on the basis of probabilistic results.
The complete paper details six steps that outline the essential elements.
Step 1—Issue Raising
Create an expanded team by gathering the project’s drilling experts, geoscientists, and engineers along with other company experts having diverse experience. This team can explore all potential issues that the project may encounter. It is important to include all disciplines that are stakeholders in the drilling project to address all issues and to open lines of communication. Do not focus on specific problems in this step or try to determine which problems are most important. Most of the issues will fall into one of five categories: project objectives, decisions, uncertainties, facts, or ambiguities (things currently unknown but can be known).