Life Extension of Offshore Assets: Balancing Safety and Project Economics

Fig. 2—Overview of the value-chain model with main input data.

The number of aging offshore facilities in the Asia Pacific region is increasing. The decision to extend the service life of an offshore asset is made on the basis of detailed technical analyses combined with detailed economical evaluations. The authors have developed an integrated approach that combines technical assessments with risk-and-reliability analysis to form a value-chain assessment (VCA) that can be used to better evaluate project economics related to a life-extension project.

Introduction

As oil and gas installations exceed their original design lives, they enter life-­extension stages. For many of these installations, the economics is still favorable to continue to produce oil and gas from existing reservoirs; the installations can also become important hubs for transportation and the processing of hydrocarbons from new fields and discoveries, typically developed as subsea tiebacks. Operators seek assurance that they can extend the lives of their infrastructures and installations safely and economically.

The decision to extend service life of an asset requires answering a number of critical questions regarding the status of the installation and the equipment, the necessary investments required to verify a sound economy for the extension period, and the assurance of safe and reliable operations. The income from the production in the tail-end phase of a project is typically not huge, and a detailed assessment of the capital investment (CAPEX) required for upgrades; modifications; or replacement of systems, equipment, and controls needs to be performed with care. Similarly, the operational cost (OPEX) must be examined carefully, a task that will require a thorough assessment of the status of the safety barriers and production-critical equipment to determine maintenance requirements and possibly also predict future production interruptions. The objective is to continue to operate economically without compromising performance or safety.

This article, written by JPT Technology Editor Chris Carpenter, contains highlights of paper SPE 165882, “Life Extension of Offshore Assets—Balancing Safety and Project Economics,” by H. Brandt and S. Mohd Sarif, Det Norske Veritas, prepared for the 2013 SPE Asia Pacific Oil and Gas Conference and Exhibition, Jakarta, 22–24 October. The paper has not been peer reviewed.
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Life Extension of Offshore Assets: Balancing Safety and Project Economics

01 January 2015

Volume: 67 | Issue: 1

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