PDO: Liquid assets

02 May 2003
Water has a big part to play in producing oil in normal conditions, but in Oman its importance cannot be overstated. Petroleum Development Oman (PDO), which is responsible for 90 per cent of the sultanate's crude output, is banking on the vital resource to help it restore oil production to a respectable plateau of 800,000 barrels a day (b/d) from its present low of around 700,000 b/d. Without a reliable supply of water, PDO would find it impossible to either drill wells or implement essential improved oil recovery (IOR) projects. Last year the company formed a management team devoted to addressing this key issue.

'My task is to look at the synergies between all the water projects and water-related issues within PDO,' says Anton Sluijterman, water management team leader. 'We have formulated a water management framework that draws together the key issues: disposal of production water; water flooding; and the supply of potable water.'

Over the next 10 years, the company estimates that oil field injection requirements will double to 700,000 cubic metres a day (cm/d) of water. A further 40,000 cm/d will be needed as feed water for steam injection projects planned in the Qarn Alam and Mukhaizna fields, while supplying potable water for staff will draw down on a further 12,000 cm/d. Drilling is also a burden. A single well can require anything from 2,000-7,000 cm/d of water and in some fields where hundreds of new wells are envisaged, the pressure to find additional water will be intense.

The irony is that PDO already produces about 650,000 cm/d of water with its oil, which equates to a very high water cut of 84 per cent. Most of this water is produced in the south, where there is less of a requirement for IOR, compared with the northern and central regions where the bulk of PDO's water and steam injection projects are planned. The company is already drawing down about 50,000 cm/d of water from fragile aquifers just to meet its day-to-day operational requirements.

Once project activity kicks in, these resources could become strained. 'The water, which falls in the Dhofar and Oman mountains, travels at a rate of 10 metres a year, so it takes about 10,000 years for the water to reach the central Oman plain. The aquifer is extremely sensitive,' says Sluijterman.

To make matters worse, water production is expected to exceed 1 million cm/d over the next 10 years and dealing with its disposal, mainly in the south, will prove to be a major challenge for PDO. At present, 100,000 cm/d of production water, which is laden with heavy metals, is pumped back into shallow ground water aquifers. But as the volume of water requiring disposal increases, so too do the environmental implications of pumping it back into the water table.

Sluijterman says: 'As water travels through the aquifer it picks up minerals and becomes more saline as it works its way inland. In the south, this water is almost drinkable at source, but in central areas the water is more saline than seawater and therefore it is unsuitable for many oil field applications. We draw a lot of water from this aquifer and the question is whether this is sustainable.'

Preserving the quality of precious groundwater resources is essential in an arid country like Oman. Shallow aquifer disposal is scheduled to end in 2004 and from then on PDO plans to drill all its deep water disposal wells to depths greater than 1,000 metres. This will not come cheap, however. Capital expenditure for deep water disposal over the next five years is expected to exceed $70 million and the long-term cost of deeper disposal drilling is estimated to be in the region of $0.13 per cubic metre of water disposed.

The obvious solution to the dilemma is to build a pipeline. The company is studying options to transport excess water produced from the Nimr field in the south some 350 kilometres north, where it is needed as boiler feedstock for steam injection projects in Mukhaizna and Qarn Alam. The project, known as the Trans Oman Water Line (TOWL), would supply both fields with 40,000 cm/d of low-salinity water from Nimr to drive giant steam injection plants.

A second phase could also extend the TOWL a further 350 kilometres north, where it could provide another 15,000 cm/d of vital water for the existing water flood project in the Lekhwair field. However, the cost of building such an extension, estimated to be in the region of $150 million, is thought to be too prohibitive for the project to go ahead.

'The key driver for the TOWL will be the steam injection projects. They should carry forward the cost of building the pipeline. We have to make a final investment decision by 2005 if the pipeline is to be operational by 2007,' says Sluijterman.

The immediate priority is to ensure that enough water is available for water flooding, which is expected to deliver an additional 35,000 b/d of crude in 2004. PDO is already injecting 340,000 cm/d into its reservoirs just to maintain wellhead pressure, and this figure is set to exceed 700,000 cm/d by 2013. Ten clusters in total are identified for water injection: Lekhwair, Fahud, Barik, Bahja, Zauliyah, Sadad, Rima/Runib, Warad, Al-Burj/Amal and Marmul.

Flooding is the mainstay of PDO's recovery programme and, if pursued aggressively, its best chance of achieving its 800,000-b/d production target until the more advanced steam and gas injection EOR schemes come on stream. When compared to the $10-a-barrel production costs associated with such methods, it makes sense to go after the cheap oil first with water flooding. Production costs for water injection should come in at an affordable $6 a barrel.

'For every 10 barrels of water we inject into a well, we expect to get a return of one extra barrel of oil. We are engaged in the water industry as much as we are in the business of producing oil. Oil almost appears to be a by-product of our core activity, which increasingly is processing and disposing of excess water,' says Sluijterman.

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