Meeting the Deep Water Challenges

The Schlumberger Vision

Ho Chi Minh City, Vietnam

Nov 8th 2012

Wallace Pescarini
Vice President, Deepwater Operations
Deepwater: Increasing Importance
 Energy Demand Annual Production
 55% of the needed supply has yet to be 140
discovered NGLs
Unconventional oil
120
Oil to be developed or found
Oil from currently producing fields
100

Oil Production (Mbpd)

80

60
32%
55%
40

20

0
2010 2020 2035
Source: IEA World Energy Outlook 2011
Deepwater: Increasing Importance
 Energy Demand
 55% of the needed supply has yet to be 600
discovered 500
 Activity Forecast 400
 200+ new deepwater fields to enter production
300
in the next 4 years
200
 By 2020 10% of the global supply will come
from deepwater production 100
0

1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
Deepwater: Increasing Importance
 Energy Demand Upstream Capex and Cash Flow from
 50% of the needed supply has yet to be Operations ($ billion)
discovered 1000 Cash Flow from Operations
 Activity Forecast Finding & Development Capex
800
 200+ new deepwater fields to enter production

$ bn/year
in the next 4 years
600
 By 2020 10% of the global supply will come 2000-2010 CAGR 15%
from deepwater production 400
 Finance
200
 Capex to exceed USD 600 billion
 200 projects > USD 1 billion 0
 Increased deepwater drilling activity

1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Sources: IEA WEO 2010, IHS Herold, Barclays Capital,
Sanford C Bernstein, SBC analysis
Deepwater: They still keep coming
DW Rig Deployement
500

450
Tender Drillship Semisubmersible
400

350
Rig Count

300

250

200

150

100

50

0
 Deepwater: Complex and Challenging

More complex  Deeper waters (1,500-10,000 ft)

Deep water and hydrocarbons, geologies,  Expensive wells (USD 30-150M)
complex and logistics;  Risk management essential
higher temperatures  Highly technology intensive
environments
and pressures  Operational Integrity - key
Source: Analysis SLB, ODS Petrodata, RIGBASE, Updated 0211, WoodMcKenzie
Deepwater: Well Construction Challenges
 Seismic Imaging through salt
 Drilling through salt
 Uncertainty on the pore & frac gradients Pleistocene
– Stable mud weight window
– Losses and kicks
 Shallow Hazards Identification Piocene

– Shallow water flows, gas hydrates Miocene

 Bore Stability
– Shallow soft sediments Campanian-Maastrichian

– Overpressure zones
Zaedyus Fan Target
 Zonal Isolation
Cenonian-Turonian II
 HP/HT up to 30kpsi
 Data Transmission
 Deepwater: Project Readiness
 Operational Project Readiness
– Identify potential hazards and resource constraints early
– Exposure, complexity, people and technology
– Develop appropriate action plans.
– Reviewed at required management level
 Benefits:
– Early improvement in well design program
– Risk mitigation tool, management review
– Allows continuous improvement
 Deployment:
– Get it right first time
 People: Competency is Critical
Competence means the ability to undertake responsibilities and to perform Competency Management System (CMS)
activities to a recognized standard on a regular basis. Competency is a
combination of practical and thinking skills, experience and knowledge, and may
include a willingness to undertake work activities in accordance with agreed
standards, rules and procedures. Competency depends on the context and the
environment in which the activity is performed, and also on the working culture
of the organization.

Source: Oil &Gas UK: “Guidelines on Competency for Wells Personnel,” Issue
1, January 2012
 Deepwater: SLB Deepwater Operations
Specific focus :
 Dedicated deepwater organization
 Specifically certified professionals
 Deepwater Operational Processes
 Continuity, asset mgt, risk mgt tools...
 Integrated services project management
Benefits:
 Seamless project planning and execution
 Risk reduction in complex project environments
 Flawless execution—reducing risk and costs
 Maximized production
Big Potential, Big Challenges

Key to meeting future energy needs

Industry is responding ……. though keeping pace with competency needs

will likely be our biggest challenge

Prizes are big, but are complex and costly …… no room for failure

Risk management and collaborative planning will be key to success