Mature fields

Breaking From the Norm To Reach Marginal Offshore Fields

A number of companies are pushing for alternative approaches to offshore development that seek to access marginal reservoirs. Their differing and unique ideas call for a departure from the usual playbook, but share a common goal of slashing capital costs.

The last few years of offshore megaprojects have produced some of the worst margins in the oil and gas industry. To achieve long-term profitability in the subsea world, some argue that oil companies must begin thinking smaller.

One could argue that now is not the time to discuss how marginal or stranded offshore fields can be effectively monetized. After all, even in the good times the offshore sector showed that it had little appetite for small-scale developments; their risk-reward ratio is usually not viewed as worth the effort.

On the other hand, going big has not exactly worked out for the offshore sector in recent years. Too many headline projects have suffered major cost overruns or missed production targets.

And thanks to low oil prices, most of the recently completed projects that managed to stay on budget are now operating at a significant loss. On top of all that, the number of commercially viable offshore discoveries has been shrinking each of the past few years.

As the challenges continue to mount, a number of technology developers are hoping to rewrite the offshore playbook.

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