1. Shell Case Study
Akhil Prabhakar
Shiv Pratap Singh
Swapnil Pal
Puneet Seth

2. INTRODUCTION
GECA aspires to expand its business in Omega.
Objective:
To come up with a development strategy that aims to minimize the UDC of the
project and ensuring minimum operational requirements by GECA; at the same
time complying with the local content requirements.
Key Considerations:
Technical, Economic, Commercial, Operational and Political
Techno-Economic-Commercio-Politico-Operational

3. Our Approach…
UDC minimizing Cost/Recovery
Drilling:
Key for decision making
Geological Uncertainty Recovery Cost of
extraction
Permeability Volume Extraction Compartmentalization
techniques
Better extraction technology :: higher the cost of technique
Cost Recovery
Potential large pools of hydrocarbon better extraction

4. Techno-Economical
Surface and sub-surface facilities
Recovery factor
0.2mD 2mD 20mD
Gas 10% 30% 50% Deviated well
condensate 5% 15% 20%
Gas 30% 55% 70% Horizontal well
Condensate 10% 22% 40%
Permeability ∆RF * Volume ∆Cost
Cost:
0.2mD 20% 25-17=8M$
Horizontal wells: 25 M$
Deviated wells: 17 M$ 2mD 25% 25-17=8M$
20mD 20% 25-17=8M$
Constraints for decision making :
• Type of drilling is supported by given subsurface
• Volume & permeability
• Surface facilities
• Demand

5. Key Stakeholders
• National and Provincial government of Omega
• Marine Environment Assessment Departments
• Local Population and labour which will be trained
• Local contractors and suppliers
• Beta Oil
• Employees of GECA and its partner Beta Oil
• Communities located around pipeline sites.

6. Plan of Action
• focuses on maximum recovery
• one time facility cost: 100 million$  high UDC
• aggressive approach towards recovery for early break-even
1st stage • maximum number of wells must be drilled in 1st stage.
• focuses on sustaining the production rate
• lesser number of wells drilled
• UDC will be less; but so will be the recoveries
2nd stage • enhanced recovery techniques
• Choice of extended operation: 1) political stability 2)
performance of well
3) relations with key stakeholders
3rd stage
3 (2+1) stage development plan

7. Unit Development Cost
Volume: 200 Bscf
Recovery factor: 40%
Maximum No. of wells: 12
Total Recoverable volumes for the project: 80 Bscf = 464.04 MMBOE
Cost of each well: 20 M$
Total Cost: (240+100) = 340 M$
UDC = 0.733 M$/MMBOE
Share of the government = 40%
Total Recoverable volumes for GECA:
(80 Bscf = 464.04 MMBOE) *s
Where s = 0.6
Share of Beta Oil (x):
Total Recoverable volumes for GECA after giving Beta Oil its share :
(80 Bscf = 464.04 MMBOE) *s*x
Where x = 0.8

8. Commercial
Gas
Processing
Gas Amount depends on
Cost = y m$ - CGR = 100 Bbl/MMscf
NGL - Volume of recoveries (V*s*x)
- Selling Price in Omega market
- Revenue > Cost (y)
Feasibility of the project depends on: Chemical based industries
- Consumers and Demand of NGL
- Break-even point Export
- Surface Facilities
- Future Consistency (Production Rate)

9. Commercial-Political
Scenario in Omega
• Short of electricity supply
• Employment
Gas/oil based plants
Partnership with government
GDP
Petroleum is the
cheaper source
hydrocarbon sector
other sources

10. Risk and mitigation
Risk Mitigation
Collaboration with Beta Oil Competitor Negotiations
GECA Risk
Partnership with government Political instability
Mitigation
• Pro-people policies
• Social upliftment
Technical :
• Uncertainty in permeability estimation, volume estimation.
• Risk of compartmentalization and extent of faulting.
• Drilling risk: directional drillers may lose their way combined with unpredictability of structural
and stratigraphic variations.
• Risk due to variations in CGR while production.
Mitigation :
• Better imaging technologies
• combination of seismic and well log data  structural and stratigraphic details.
• Drilling uncertainties  Integrated Forward Modelling Program to build formation model and
to simulate log response and updating it on a real time basis.

11. Condensate banking
• Condensate getting accumulated near wellbore:
• Reduction in effective permeability to gas
• Reduction in well productivity
Mitigation:
Reservoir Stimulation:
• By the injection of inhibited dry gas with incorporation of alcohol and surfactants
• With inhibited chemicals (e.g. diesel and alcohol) to remove liquid saturation
WAG (water alternating with Gas) method.
Mechanism to enhance gas effective permeability like miscible displacement, interfacial tension
reduction and alteration of wettability.
Social risks (health, safety and security of the employees and local communities)  regular drills
and frequent inspections. Partners, contractors and associates are made to comply with safety rules

12. Environmental Precautions
• Blow-out prevention
• Use of environmentally friendly mud: water-based or synthetic based.
• Closed loop drilling waste system.
• Use of non-toxic frac fluids for well preparation.
• Re-use frac flow back water.
• Reduction in gas flaring through GTL stations and reinjecting the gas back in
reservoirs and leak detection systems.

13. Thank you