Having recently signed a new collaborative partnership with Weatherford for one-stop well decommissioning, Exceed’s John Anderson explained to InnovOil how this model could change the sector
Unlikely though it may seem now, John Anderson is already anticipating a North Sea rig shortage. For sure, it will not come immediately – but when it does, the decommissioning sector perhaps most of all will need some innovative technologies and flexible business models to fulfil its remit, while keeping costs down.
Anderson, commercial director at well management firm Exceed, said that before the company entered the space the most important thing was to talk to as many operators as it could to determine what exactly it was that they wanted from a decom service provider. “Everyone said: a one-stop shop,” he explained to InnovOil. With core teams getting smaller and focusing on value-adding work, he added, decommissioning is viewed as a removal of liability, meaning outsourcing is an attractive option from a technical and a commercial point of view.
Although it has won contracts on its own – including supporting Fairfield Energy with its 61-well plug and abandonment (P&A) campaign – Exceed is now pairing its well management expertise with the technical knowledge of a number of other service providers to offer a flexible and collaborative decom model – with the aim of becoming that “one-stop shop.”
Accelerating the “learning curve” on decom techniques and technologies is one way the firm hopes to improve the process. “There are an awful lot of ways to decommission wells, and thus far operators have tended – quite rightly – to use more proven methods, like section milling,” he noted. But this does not have to be the case; if emerging procedures can be proven to be reliable and adhere to regulatory guidelines – he stressed the flexibility they offer provided an operator can demonstrate their effectiveness – there is a lot of impetus to take them forward.
This is where a future shortage of rigs will force a change. The expense of using an entire rig to perform only a few of its capabilities highlights the industry’s need to adopt more flexible options, either from platforms or from light intervention vessels. With new equipment Anderson believes future P&A campaigns in many cases could be done with “just a wireline unit and coiled tubing. Our partners offer a number of modular platform based packages, which will also help the partnership offer more flexible options to customers.
He expressed excitement for other technologies too, in particular new acoustic and ultrasonic evaluation tools which help to enable engineers to see through multiple casing strings and improve the efficiency of plug placement and casing cuts and pulling. Likewise, he pointed to new perforation and circulating tools which will negate the need for more time-consuming section milling, helping to speed up the P&A process.
“Wells are different – every application tends to be bespoke, so you need a wide range of tools… Because it’s decommissioning, everybody wants a tool which does more for less,” he said, “But it has to be proven.” Exceed appears willing to explore these new technological avenues as part of its contracts with a view to finding the best and most flexible approach – a flexibility which extends to procurement. “That was something we talked about on Day One. If there’s a better tool out there, we wanted [the freedom] to use it,” Anderson added.
Anderson also elaborated on the partnership model itself, and how collaboration might become more of a staple in the decom sector. The first point he raised was his belief that an incentivised approach works far better than a simple service/day rate, largely because “everyone buys in.” The industry has “never really been able to get away from adversarial contract terms,” he explained, but with all parties acting as stakeholders, there is far more room for co-operation and collaboration. “It tends to be what happens in the bad times, but it should really extend to the good times as well.”
That collaboration should extend to operator procurement too. Currently, departments are “very siloed,” Anderson said, and will frequently approach one supplier for one component and another for something else. Part of the “one-stop” concept is to update that idea – “We’re in a supermarket!” he says – and operators should be able to procure equipment through one invoice, rather than multiple.
It is not a radical innovation, but it illustrates where savings can be made quickly and effectively as the sector grows. In the meantime, Exceed, and its partners will be taking the partnership model to the Gulf of Mexico, Middle East and East Asia. That model is also still evolving, and Anderson hopes it will encompass even more in the coming years, to “wellhead, pipelines, subsea infrastructure – even platforms! It would be great to expand it into full-field.” For now, though, it seems like Exceed has plenty on its plate to kick-start some decom innovation.