Atkins’ new platform design combines the flexibility of an FPSO with the stability of a SPAR, offering a new blueprint for marginal field development
In the heady days of US$120 oil, even so called “marginal fields” were attractive, particularly to smaller operators working in the UK Continental Shelf (UKCS). With crude so valuable and breakeven margins generous, it was relatively straightforward to attract enough investment to exploit the smaller oil accumulations often neglected or abandoned by the established oil majors. Today, the story is obviously rather different, yet some of the ideas generated from this period of frantic activity may now come in useful as operators look at more efficient, low-cost methods of developing new fields, and the potential for improving the economics of so-called small pools.
In 2012, UK-headquartered engineering group Atkins – now part of SNC-Lavalin – began assembling a team of naval architects to focus specifically on marginal field development. Working with a number of different operators over several years, the team came up with several promising solutions that could help to overcome some of the challenges posed by (potentially) stranded assets. Out of this effort came the Deep Draught Production, Storage and Offloading facility (DDPSO) – a reusable, floating design designed to operate in harsher environments that would otherwise preclude a smaller, ship-shaped FPSO.
Oil and water
As with the best innovations, the DDPSO takes a number of successful design elements and combines them with an element of inventiveness. In this case, the inventive element is the deep draught hull shape of this small FPSO. The result is a unique facility that is more disruptive than the simple sum of its parts.
Speaking with InnovOil at Atkins’ London offices, director for Field Development & Consulting in Engineering & Consulting Paul Gallagher explained that the idea for the DDPSO had evolved alongside the team’s work designing a subsea oil-over-water storage tank as part of Premier Oil’s Solan project. In this instance, oil held in a 300,000 barrel subsea tank displaces seawater as it is pumped in, ensuring the system is always at constant pressure. While this method is quite common, Solan itself is unique because the tank is separate from the production facility.
Following its successful application subsea, the team expanded its design scope to look at alternative methods of deploying the oil-over-water system, including studies for a floating storage buoy and a semi-submersible production platform which stores oil in its pontoons. Despite interest in the latter design, also known as the FPS3, the challenges of making marginal developments work at North Sea fields such as Fyne and Bream meant the idea was shelved, but it would spin off into an even more compact form – the DDPSO.
Essentially halfway between a SPAR platform and an FPSO, the DDPSO incorporates a unique hull form which uses the oil-over-water storage method to ensure a highly efficient use of space and weight. The cargo tank sits inside the hull with a central caisson running down its centre. At all times the tank is “pressed full” with either water or oil – or a combination of both – minimising hydrocarbon vapour at the top of the tank. During loading or offloading of crude, the total volume of liquid inside the cargo tank remains the same, while adjustments in draught or trim can be made via smaller ballasting wing tanks outside the storage area.
Gallagher emphasised why the team had persevered with the design: “A couple of things just became clearly and obviously novel when we were playing with the design spreadsheet, because of this oil-over-water storage method. There are some properties it has around stability and its response in waves… We couldn’t quite believe our eyes – surely we must have a bug in the spreadsheet – it was actually doing something that was counter-intuitive.”
“That’s always the sign of something that actually makes an invention truly novel – you couldn’t have come about this though normal engineering routine, it had to be something that popped up out of the blue,” he continued.
Strong and stable
The secret of its stability lies in the combination of some the basic principles of marine architecture. First is that by ensuring the tank is always full, the cargo cannot move around inside the hull – a mechanism known as the free-surface effect (or sloshing). In FPSOs, which are constantly being filled or emptied, this is extremely beneficial, and lowers the requirement for ballast considerably.
It also ensures that the DDPSO has a relatively constant centre of gravity (CG), and the small difference in density between crude oil and seawater minimises variations in total mass displacement – the point inside the vessel where gravity will act upon it. As long as the vessel’s CG is below its centre of buoyancy (CB) – which is the CG of water displaced by the vessel – it should remain stable. This principle is employed by SPAR platforms, which are heavily weighted at their bottom to provide submarine stability. However, doing so also requires more buoyant volume at the top, which in fabrication terms means more steel and greater expense.
In the case of the DDPSO, “A small amount of ballast water may be used to control the draught, but it can be put in at the same level as the centre of gravity, keeping it constant to within a metre,” Gallagher noted.
Additional support is offered by the waterplane, using the same principles that help conventional ships remain stable. But the waterplane also has an effect on the response of the platform in waves, as it provides the property of hydrostatic stiffness to heave, roll and pitch motions through its influence on natural or resonant periods. Typically, offshore floating production platforms such as SPARs or semi-submersibles are designed for natural periods above 20 seconds so as to de-tune them from the influence of wave loading. Despite its diminutive size – 75m draught and 40m across – the DDPSO sits pretty with a natural heave period of around 19-20 seconds.
“That was the sort of ‘eureka moment’,” Gallagher said. “This shape, combined with heave plates to increase hydrodynamic added mass and damping, gives something that is quite unique considering it is so small.”
“It’s a combination that I found odd no one appeared to have thought of before… This has properties of an FPSO but the motion characteristics of a much larger semi-submersible or SPAR.” This was also what Atkins patent agents found of interest and supportive of the invention through gaining UK and US patent recognition.
Moor for less
The smaller footprint of the DDPSO means operators can commit to lower capex in order to make marginal developments work. Gallagher defined a typical marginal field as somewhere between 25-50 million barrels of reserves, with a production rate of up to 25,000 bpd, although it may often be less. Crucially, they are also characterised by a rapid fall-off in production volumes and some uncertainty over the reservoirs themselves – all of which makes a re-usable facility far more attractive.
Typically, an FPSO has been the solution of choice. Built around a converted Aframax tanker and capable of storing up to 500,000 barrels, they are proven and easily available. However, scaling them down to hold smaller volumes does not offer much cost benefit in marginal development. Installing a US$100 million mooring turret system and new topsides can easily take fabrication costs past US$500 million before a well is even drilled. With just 50 million barrels or so in play, the project is unlikely to be economic.
Gallagher noted that some of these problems had been overcome by the circular Sevan Hull design used in projects such as Hummingbird Spirit, although these hulls are quite conventional in terms of stability and hydrodynamics. Storing upward of 300,000 barrels – and 400,000 and 600,000 in larger builds – they use separated ballast and crude oil storage tanks, which means a larger expected outlay for the hull steel-weight.
The DDPSO, meanwhile, is designed in two variants holding either 200,000 or 300,000 barrels in water depths of 90m and above. Even at the smaller end of the production scale it has similar – if not better – motion characteristics than much larger conventional ship-shaped FPSOs. “But because we use oil over water storage, we don’t have any ballast water requirements, we don’t have all the associated volume, we don’t have a turret and we don’t have the steelwork that goes with it – and so we have a cheaper hull,” he continued.
Atkins also opted for integrated topsides (up to around 6,000 tonnes under current designs) rather than a bespoke layout, again maintaining a focus on maximum flexibility on a budget. “A lot of effort goes into laying out FPSO topsides, and quite often you get squeezed for space or it’s inefficient because you have too much,” he said. “With the DDPSO we are using an integrated topside that just stabs into the upper deck like it would with a fixed structure or a SPAR.” This plug-and-play approach speeds up fabrication, as both the hull and topsides can be built in parallel and brought together when ready, either in the yard or after float-out. Gallagher reckoned that this could reduce fabrication time by six months to a year, compared with a traditional FPSO.
Float-out is a relatively straightforward operation, whereby the central storage tank is flooded, ballasted and the platform upended. This can be done either at the field or in sheltered deep water, and the entire structure towed into place. And following the end of production, the facility can be unhooked, towed away and re-used, with new topsides swapped in as needed.
All in all, the gains made by Atkins are compelling, in both engineering and economic terms. Some simplified numbers from Gallagher and his team suggest that a DDPSO moored in a marginal field with two to four production wells and two water injection wells, producing 24,000 bpd at peak production, could begin generating ROI within four years, based on oil at US$50 per barrel.
Atkins assumes spending of around US$375 million on the DDPSO itself (including mooring system, risers and flowlines), with overall field development costs (including exploration, drilling, completion and subsea facilities) at US$800 million and opex between US$14 and US$18 per barrel (NPV). Producing a total of some 50 million barrels at US$50 per barrel, the facility could generate net NPV earnings of US$400 million after 10 years, breaking even in less than 4 years.
The conservative nature of E&P clients means there is still pressure to deliver on efficiency. Gallagher added: “There is still a push to get the price down – and that means getting opex down, reducing topside weight, making it as simple as possible – but that helps us too because that takes the design in the right direction.”
At present the team is now considering additional modifications to the design, such as further weight reduction, the optimum hull forms for storage volumes and even running the DDPSO as an unmanned installation. “We can feel the momentum towards running things remotely. The thing about the DDPSO is that it’s neither a SPAR nor is it a conventional FPSO – there’s nothing the rulebook that says it needs to be manned,” he continued.
Nevertheless, having been awarded patents in the UK and most recently in the US, the DDPSO’s simplicity belies its real ingenuity. And with project sanctions ticking upwards, the design now has a real shot at being taken to market. After almost a year without a single approval, 10 FPSOs were ordered between Q4 2016 and the end of 2017, according to GlobalData – a recovery that may extend to more marginal developments as smaller operators move into regions such as the North Sea.
Moreover, the design is ready to go, should the right call come in. The question now is whether the appetite for small pools can grow, and while the voracious appetite of pre-2014 may never be repeated, the DDPSO goes some way towards proving that marginal resources do not necessarily mean marginal gains.