Economic Report 2019

ECONOMIC REPORT 2019

CASE STUDY

In 2018 Shell made seven project investment decisions for the UKCS, including the development of the Penguins field in the northern North Sea, and Fram, Arran, the Shearwater gas hub and the Gannet Export infrastructure investments in the central North Sea. These new project sanctions have a direct impact on increased drilling activity over the next three years, with more than 20 development wells associated with these projects. Shell also plans to drill up to five exploration and appraisal wells over the next three years, resulting in a level of drilling activity not seen for over a decade.

CASE STUDY

The operator of the Jasmine area has implemented ‘relational contracting’ principles with key suppliers forming a ‘Well Alliance’ between seven well operations suppliers who play a critical role in their drilling campaign. The Alliance demonstrates commitment to a new collaborative way of working, based on relational contracting principles such as problem solving, joint working and performance measurement. To acknowledge and reward supplier contribution to overall performance, the Alliance Incentive Scheme was implemented, whereby savings are shared between the client and Alliance members. The proportion shared increases on a sliding scale, to incentivise contractors to deliver superior performance. Identified improvement opportunities have already realised significant value for all parties.

CASE STUDY

During well operations, drilling tools and equipment can often become lost or stuck downhole (around half of these jobs involving the retrieval of drilling cable), creating potential problems around the performance of the well. Gaia Earth Sciences has developed a new technology to help mitigate this problem — the Cable Protection System — which helps reduce friction on the cable and ensures it remains suspended above areas of risk in the well. The system also helps predict and model cable sticking and allows drilling engineers to optimise their well paths. This provides confidence that the well operations will be completed successfully and efficiently and also avoid costly subsequent interventions. The technology is designed and manufactured in the UK (in Wales) and has been exported and applied globally, delivering a 98 per cent success rate and significant cost improvements.

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