Succeeding in the Shale Business With a Lean Well Manufacturing Management System

Topics: Project management
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The current oil and gas commodity prices have posed several challenges to oil and gas companies operating in shale plays trying to generate revenue or even becoming cash neutral. Shale drilling, as opposed to conventional drilling, requires many more wells to produce similar volumes of oil or gas due to the significantly smaller wellbore drainage area and the tight nature of the reservoir. For these projects to be economically viable, a high volume of low-cost and quickly drilled and completed wells is required, which cannot be achieved with a conventional oil and gas mindset.

By implementing a Lean Well Manufacturing Management System and by having a dedicated Productivity Improvement team embedded in the operations driving changes, BHP Billiton was able to reduce drilling and completion (D&C) costs by 49% in the Eagle Ford Basin and 50% in the Permian Basin over an 18-month period (Fig. 1). These results are similar to those reported by other operators in similar plays that also incorporated lean management principles to their operations.

Carlos Bossi, SPE, joined BHP Billiton in 2013 and works as a senior drilling engineer leading the productivity improvement transformation process for North America shale. He holds an MSc degree in well design and engineering with distinction from Robert Gordon University in Aberdeen, Scotland, and a BSc degree in mechanical engineering from the Universidad Simón Bolívar in Caracas, Venezuela.
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Succeeding in the Shale Business With a Lean Well Manufacturing Management System

Carlos Bossi, SPE, BHP Billiton

01 March 2017

Volume: 69 | Issue: 3