BP is making progress towards its target production cost of $12-barrel for N. Sea oil as a result of new technology, new partnerships and new ways of working and innovation with its supply chain.
Speaking at an industry conference in Aberdeen, BP chief executive Bob Dudley detailed the benefits of innovation in:
- How we run our existing businesses – challenging and improving the efficiency and competitiveness of everything we do:
- How we develop our future businesses and business models, and:
- How we build partnerships – partnerships with suppliers, customers, governments, regulators and with society.
He explained: “To give one example, a BP engineer, anywhere in the world, can now get real-time well performance alerts through an application that processes almost a billion data points per second across our network.
“This has a very real impact on safety and the speed at which we can intervene to maintain production reliability. The same philosophy of innovation applies to improving recovery.
“We’ll be trialling new seismic capability using ocean bottom cables at Clair Ridge <West of Shetland> along with acoustic sensors inside the wells.
“Tthis will completely transform the detail and clarity of reservoir imaging, as well as enabling much closer well monitoring.
“And we recently trialled a new method of positioning drilling rigs – all done remotely with the surveyors staying onshore, so it could prove to be a safer operation as well as lower cost.
“And now we’re very focused on key areas – in the Central North Sea and in particular West of Shetland. The North Sea is one of the crown jewels in our portfolio.
“We’re back to growth in the basin with our Quad 204 project coming online and Clair Ridge on track for next year, with great partners in these projects such as Shell, Siccar Point, Chevron, Shell and Conoco Phillips
“We are also participating in six exploration wells being drilled this year in the UK – so the North Sea is significant for us in our global plans in a world that is changing fast.
“We’re in a new oil price environment – one that demands a different way of thinking to stay competitive.
“We’re also in a changing supply environment– one where oil and gas resources in the ground are not just abundant, but are economic to produce as well. For some areas of the business, simple standardisation could be transformational.
“And this focus on standardisation, simplification and discipline on cost has contributed to our average production costs in the North Sea coming down from a peak of over $30-barrel in 2014, to less than $15-barrel today.
“Heading towards 2020, with all our major new developments coming into production, we expect that to come down below $12 a barrel in the North Sea.”
14 Sept 2017