This is the first of a two-part series by Francesco Falco. In this article, Francesco explores where the industry is heading in terms of subsea infrastructure, and next month he will discuss the technologies that will help it get there. GE has more than 1,000 customers in 115 countries in the Oil & Gas sector with more than 10,000 employees worldwide providing the innovation and technology to meet tomorrow’s toughest challenges.
If the technological advances of the past 30 years in oil and gas were as breathtaking as putting man on the Moon, then the ones we face today will be like building a permanent settlement on Mars. In terms of helping the industry face the energy challenges of the future, subsea technologies will be one of the pillars that will maintain—as well as increase—oil and gas production levels in the coming decades.
Why the industry is going subsea now is simply because, as we go further and deeper into the ocean’s depths, we do not have the pressure to pump the oil with traditional technologies. If we aim at decreasing the rate of decline of wells in the Gulf of Guinea and targeting recuperation rates in the range of those of wells in the North Sea, then we are going to have to put the topsides nearer to where the oil is and not three kilometers above. It’s about getting every last recoverable drop of oil out of these wells so that we can offset decline as long as possible. Increasing recuperation rates even by a couple percent will make a huge difference—not only for meeting future energy demand, but also for lowering the lifetime costs of the field. Subsea processing could increase field reserves from 20 percent to 30 percent.
In the next 20 years, market growth will average 14 percent annually with four main applications for subsea processing:
- Boosting - increasing oil recovery through full well stream boosting
- Seawater injection - increasing oil recovery through water flooding
- Separation - debottleneck, creating incremental capacity
- Gas compression - enabling gas production and improving economics in mature fields
Imagine that by tomorrow, we will have fully functioning production platforms siting on the bottom of the ocean at depths of 2,000 meters or more. What will be the cost?
Subsea processing is driven by economics and increased oil recovery. I think it will be the solution not only for some extreme areas like the Artic - since it enables access to stranded assets – but also for most of the future offshore discoveries that will be in deep and ultra-deep water.
Costs are not only important for mature fields, but for those currently in development. A full subsea field development can cost much lower than a traditional development scheme. This, coupled with higher recuperation rates, higher energy efficiency, lower maintenance and increased reliability, makes it crystal clear to me that the oil and gas solutions of the future will be subsea.
Nevertheless, this segment evolution will continue to be impacted by perceived risks and the cost for technology qualification. We have the opportunity to invest in subsea technology and mitigate those risks through reduced system complexity, more robust and tolerant components, and remote diagnostic.
Indeed, they are already part of the technology solutions we offer to our customers. In Norway, for example, we are building the future plans for a full field development with a 120 kilometer tie back and a full subsea compression station. I am proud to say that the teams I work with here are actively contributing to it.
Let’s stand back for a minute and look at the very long-term view of the technologies we are working with today. Twenty to 30 years from now I see using subsea technologies to produce hydrates, to be at the core of power stations connected to offshore wind farms, and to generate power generation from ocean currents. Today it is more than just a technological challenge. It is more than developing the right innovations at the right time. It is also a challenge to continually seek out what will be the energy trends of tomorrow and have the management foresight to illustrate the solutions in advance. Never before have we collectively faced so many challenges at the same time.
What is sure is that the world needs increasing energy and that meeting this need will come from increasing our technological inputs. It will be about changing technology into solutions and back again so that our imagination, and those of our children, will continue to reach for the outer limits of what we once thought was impossible.
In my next post I will go into the key technologies that are changing the subsea space.