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....
Succeeding in the Shale Business With a Lean Well Manufacturing Management System
Carlos Bossi, SPE, BHP Billiton
01 March 2017