Gazprom Neft Shelf: Prilazlomnoye Field Development

Gazprom Neft has added a new chapter to the history of Russian Arctic exploitation by developing the Prilazlomnoye field in the Pechora Sea. The past, present and future of the project are discussed in this piece.

Upshot of Decision

Today the Prilazlomnoye field development project, on the shelf of the Pechora Sea, is the hallmark of the Russian primacy in the Arctic exploitation – with good reason. Over 2 million tons of produced oil, long-term agreements with North West European refineries and slick logistics in an ultra-harsh Arctic environment are among the list of glittering achievements. But hardly anyone knows that the chronicle of Prilazlomnoye could have been over before it virtually began in 1989.

During testing, the well produced hydrogen sulfide smelling oil while the maximum well rate was just 80 CMPD. It was a result that would basically prompt a practical decision to cease work. However, Yury Fedorovsky, Chief Geologist for AMNGR, agreed with Oleg Zalivchy’s suggestion to treat the bottomhole with acid (for the first time on the shelf) as is usually done with the Permian phosphate deposits. Following the acidizing treatment and well cleanout the project team obtained a well rate of 400 CMPD. All it took was one sound decision and the field became the number one in the Arctic, rather than another addition to a long list of promising but underexplored fields.

Then again Prilazlomnoye was a very long step away from becoming the hallmark. In 1990’s the Prilazlomnoye Project, like the entire country, went through bad times: a long 15 years elapsed between a ceremonial keel laying of the Prilazlomnaya offshore ice-strengthened fixed platform at Sevmash in December 1995, to its launch. But then events moved rapidly. The Prilazlomnaya platform was towed to the Kola Bay for outfitting at the 35th Shipyard in 2010. Platform construction was completed as early as August 2011, and it took its position in the Pechora Sea.

The southeastern part of the Barents Sea is free from ice for 120 days a year at a maximum. For this reason the Arcticmorneftegazrazvedka (AMNGR) Production Association, engaged in the Prilazlomnoye exploration, had to accomplish a virtual tour de force. The Kolskaya floating drilling rig was to be towed to site, installed in its position, drill an over 3,000 metre deep well with its subsequent testing and suspension, and then towed back to harbor, all in less than three months. “Days really counted,” Oleg Zalivchy, who managed the well 1 testing activities at that time, recalled “The window of time till the water froze was extremely tight, the weather at sea was getting worse, and leg penetration was at its lowest limit due to the solid sand bottom.”

But, as it turned out later, the most significant issue was neither time pressure nor the chances of the rig being crushed by ice.

Prilazlomnoye

In 2012 the platform was reinforced with a whole and crushed stone berm (its volume exceeds 45 thousand cubic meters) and simultaneously underwent an independently integrated quick audit involving the professionals of such heavyweights as Kvaerner, Schlumberger, Halliburton, and Marine Fleet Research Institute. The target was to identify risks for project commissioning and analyze project compliance with international standards and Russian regulations. Based on the audit the experts recognized the compliance of the Prilazlomnaya offshore ice-strengthened fixed platform with international standards. Oil production at Prilazlomnoye commenced in December 2013 and five months later, in April 2014, the first shipment of the ARCO Arctic oil went to the European consumers.

Prilazlomnoye Optimization

Prilazlomnoye is the first, and now the only, field on the Russian Arctic shelf to produce oil. It produced over 300 thousand tons of oil in 2013-2014 and the 2015 figure was over 250% of this value. Today production is from three wells while there are six wells constructed in total – two injection wells and a disposal well are in operation in addition to the producing wells. The quantity of wells will reach 32 by 2023 (19 producing wells, 12 injection wells and one disposal well).

An important milestone for Prilazlomnoye was in December 2015 when Rosnedra (Federal Subsoil Use Agency) approved amendments to the project reservoir management plan. According to the document the stable production period of the Prilazlomnoye field was extended by two years (from three years to five years) through improved field performance, and oil production during this time should increase to 180%, up to 23.1 million tons, through streamlined drilling operations. And this capacity should be available from 32, not 36, wells as the initial plan provided for. Accordingly, cutting down drilling capital expense will have a beneficial impact on the overall project economics. The asset will produce 4.8 million tons of oil per annum at the peak. Further, the updated reservoir management plan accommodates an increase in the total in-place reserves of the Prilazlomnoye field for the C1 and C2 categories by 12% up to 263 million tons. It is brought about by re-interpretation of the seismic data, as approved by the State Reserves Commission. The life of the Prilazlomnoye oilfield has increased accordingly to 35 years.

“The experience we gain working at Prilazlomnoye has promoted our field performance.” Gennady Lyubin, CEO for Gazprom Neft Shelf, noted. “We will keep on growing the first oil production project in the Russian Arctic Shelf.”

4.8 million tons, the maximum production at Prilazlomnoye, is thought to be reached by 2023. 2016 featured one more flagship event for the Prilazlomnoye field development: a change in the transport and logistics arrangements. If two 70,000-ton shuttle tankers, the Mikhail Ulyanov and the Kirill Lavrov, were used to deliver oil from the Prilazlomnaya platform to Rotterdam before, starting from February, crude is first hauled to a 300,000-ton storage tanker, the Umba, to a roadstead in the Kola Bay near Murmansk, and then to Europe by individual tankers. “Use of the Umba floating oil storage bolsters the company’s flexibility in scheduling tanker loads by increasing the volumes of each crude shipment and optimizing freight costs thus improving the Arctic oil export efficiency,” Vitaly Vyatkin, Managing Director for Gazprom Neft Trading GmbH, explained. “An intermediate hub location in the ice-free Kola Bay boosts shipment efficiency by slashing two-way voyage time for the tankers delivering oil from the Novoportovskoye and Prilazlomnoye fields and using standard fleet to deliver oil to consumers.”

European consumers themselves received the new ARCO Arctic oil very well. The major market targeted for the Prilazlomnoye crude is North West Europe or more specifically the so-called ARA area (Amsterdam—Rotterdam—Antwerp). As Vitaly Vyatkin said, the reason for this is based mostly on transport access to, and the import reliance of, this area and its plants, which specialize in refining heavy crudes similar in properties and specification to ARCO. Indeed the Prilazlomnoye oil has high specific gravity, increased sulfur content and, in contrast, low paraffin.

In 2014-2015 European consumers received 1.1 million tons of the ARCO oil, and the entire 2016 production is sold out under a new long term contract with one of the largest European oil companies.

Today Gazprom Neft is aggressively striving to broaden its ARCO oil buyer pool, even more so since  transport and logistics arrangements have been changed and the new oil blend can be delivered to any location in the Old World. An early sign was an ARCO shipment to the Mediterranean in early 2016. In the long run, the geographic coverage of the Arctic oil sales can grow through the Asian Pacific markets, along the Northern Sea Route.

Environmental Compliance 

The Prilazlomnaya platform employs a range of cutting edge process solutions to minimize its environmental footprint on the Arctic. According to the zero emission philosophy the used drilling muds, cuttings and other waste are either injected to a special disposal well, or delivered to shore and disposed of. Process water intake is pumped through a special fish protection system.

Prilazlomnoye Rig

To curtail noise emission the helicopters delivering personnel to the platform fly above the sea at a minimum height of 500m for the comfort of sea dwellers. Further, the Prilazlomnaya platform has a bird protection device with a 3,000m range. It produces disturbing and annoying sounds, authentic predatory animal calls and man-made noise that prevent birds from nesting and forming permanent flocks in the protected area.

Gazprom Neft Shelf specifically highlights research on the walruses living in the Prilazlomnaya platform area. The 2012-2015 research in the vicinity of Dolgy, Matveev, Golets, Bolshoy and Maly Zelenets, and Vaygach islands did not identify any significant fluctuation in migration and distribution of sea mammals in the Pechora Sea after the oil production started.

Another undertaking is for farming Atlantic salmon: farmed fish is released into the natural water bodies of the North Fishery Basin.  150,000 fish was released into the Vyg, Suma, and Keret rivers during 2012-2014.

Platform “Pimping”

Regardless of the efficiency already achieved, the Prilazlomnoye development has not stopped, and the platform revamp initially reflected in the field development scenario will start as early as 2016. “In light of unparalleled goals and objectives, the Prilazlomnoye Project had an array of uncertainties identified at the start-up and early operation stage.” Gennady Lyubin clarified. “A gamut of risks demanding technical changes to the project in order to reach the intended capacity was brought about by analyzing causes and seeking solutions to new challenges. It became the fabric for setting the platform revamp targets.”

The platform will improve the efficiency of its 37 systems as part of the revamp. Changes will affect the process, power, drilling, mechanical, life support, automatic safety, navigation, communication, and data transmission systems.

Arguably, the central activity on this list is a drilling system upgrade including in particular a shift from the water-based muds to invert-emulsion muds. It is necessary for construction of 11 directional wells over 6,000 m deep along hole with horizontal sections of up to 1,000 m, and a displacement of the well center of up to 4,000 m. “Our target is a further efficiency improvement of the production system through squeezed costs, streamlined business processes, newly implemented solutions proffered by the market.” Gennady Lyubin summarized. “This is exactly why we’re now revamping the Prilazlomnaya platform as prearranged.” Preparations for revamp have already started. Now the detailed design and operational documentation, test methods and plans, and revamp design are developed. The platform revamp is scheduled to be completed before the end of 2017.

Another important route of project development is shore infrastructure improvement. This summer the second and third phases of the Varandey camp are scheduled to be commissioned and will become a safe harbor for the rotational personnel of the platform. The private Gazprom Neft Shelf heliport will start its operation in late 2017. Drilling of the last 32d well at the field should be completed by 2022 that will push the field production to its peak of 4.8 million tons and become a key piece in the Gazprom Neft strategic goal to maintain production at 100 million TOE by 2025.

Industrial Safety

The Prilazlomnaya platform is designed so that it ensures maximum safety of oil production. The platform is intended for maximum ice loads and capable of withstanding a straight line impact of a ten meter wave. The Prilazlomnaya platform is protected from such impacts with a special 16.4 m high structure, the deflector, made of high strength steel. The drilling rig at the Prilazlomnaya platform is securely sheltered from external effects, supports drilling in any weather and even withstands a wind load of 51 m/s (a hurricane on the Beaufort scale).

Since sea depth in way of the platform is shallow, only 20m, the Prilazlomnaya platform is installed directly on the sea bottom with all the wells drilled within it. This way, the platform base (caisson) is a cushion between the well and the sea. The safety factor of the platform base exceeds existing loads by a multifold. It can even resist a straight line torpedo attack.

The caisson walls are made of a layer of 4 cm clad steel for better corrosion and abrasion performance, with a three meter space between them filled with ultra high strength concrete. A special paint and cathodic and anodic protection are used for shielding them from high humidity and aggressive marine environment. For extra safety the wells have  special equipment to reliably prevent oil from spilling out at a depth in case of emergency.

The oil storage tanks use the wet oil storage approach: they are always filled with either oil or water that eliminates any potential of explosive atmosphere. Oil loading from special systems begins only when 30 pre-requisites are present simultaneously. The tanker oil transfer line is equipped with an emergency shut-down system that can stop loading as quickly as within 7 seconds, if required. The platform status monitoring is provided round the clock by a special system of transmitters that instantly respond to any changes in its operation.

Aleksandra Savina

Published with thanks to Gazprom Neft & Sibirskaya Neft MAGAZINE