This paper explores the interplay between field development and lifecycle reservoir management and the selection and operation of dry- or wet-tree host systems for the development and production of deepwater oil and gas fields. Drawing on insights from recent deepwater projects, the selection criteria related to development and reservoir management are highlighted to show the advantages and limitation of the two different host concepts.
Introduction
In deep water, it is common for approximately one-third of the initial capital investment to be related to the host system. Selection of the host concept is critical and is dependent on a robust understanding of the many upfront development drivers.
The host is ultimately the linchpin in the overall development system and is critical to delivering a solution that maximizes economic value during the life of the project, to providing a degree of mitigation against key reservoir and production uncertainties that are inherent in deepwater developments, and to providing flexibility to capture any potential future production upsides that have been identified in the proximal development location.
One of the more important decisions related to deepwater host selection is whether to adopt a dry- or wet-tree system. Both systems offer distinct advantages and disadvantages, depending on the context of their application. The selection of a dry- or wet-tree system should be made in the context of the overall development system evaluation.
Wet- and Dry-Tree Deepwater Host Systems
At a high level, deepwater host development has evolved into four major options, each with various degrees of flexibility in shape and design:
- Tension-leg platforms (TLPs)
- Moored semisubmersible platforms
- Spar platform concepts (conventional, truss, and single-column floater)
- Floating production, storage, and offload (FPSO) vessels
Of these systems, a key differentiator is whether the tree—the main component for well control and safety—is located on the host itself, a dry-tree system, or on the seabed beneath or at a distance from the host, a wet-tree system. A second but no less important differentiator is whether the host allows for direct vertical access (DVA) to all or some of the wells and whether the host carries a fully equipped, or workover/intervention, drilling rig to perform well operations.
Dry-tree host systems consist of individual wells from the target reservoir connected directly from the wellhead on the seafloor to the host by individual flowline risers with the tree physically located on the host. The advantage of this system is the ability to monitor and, where a drilling unit is constructed on the host, intervene directly in each well. The host acts to support each of the risers and the rig (increasing payload and operational complexity) and, as such, requires a motion-optimized hull. These two factors are often considered limiting with respect to water depth and development flexibility.
Wet-tree host systems have the trees located on the seabed directly connected to the wellhead and have flowline risers generally grouped together and connected to the host facility. This architecture can make reservoir-management operations, such as individual well testing, more difficult to perform and can create more complex problems related to flow assurance, depending on the reservoir fluid type and properties. Some wet-tree solutions have retained DVA through a host-mounted drilling unit to some of the wet trees that are located directly below the host. In general, wet-tree solutions have tended to provide a greater degree of vessel- and field-expansion capability with simplified riser interfaces but have historically come at the expense of high drilling and workover costs because independent deepwater drilling units are required. Wet-tree systems also have the benefit of simplifying the riser interfaces and reducing the overall host-supported payload. Fig. 1 highlights the typical system differences between dry-tree and wet-tree systems.
FPSO systems are exclusively wet-tree hosts. TLPs, semisubmersibles, and spars afford a degree of choice between a combination of dry- and wet-tree deployment. To date, TLP designs have been deployed principally as dry-tree systems and have included various types of drilling rigs to facilitate drilling or direct wellbore access. These concepts are often designed to accommodate one or more subsea tieback options. Semisubmersible and spar concepts have been designed to accommodate both dry- and wet-tree functionality.
Key Considerations for Dry- or Wet-Tree System Selection
The process of host selection is generally iterative because there are usually multiple combinations of reservoir development approaches and engineering system components to be evaluated on the basis of safety, production rates, ultimate recoverable volumes, costs (initial capital and full life cycle), and operational aspects such as down time and the requirement for intervention to any of the key equipment. Critical to this decision is the analysis of key aspects of the opportunity that drive the project scope and the project value proposition. These often include
- Physical nature of the reservoir, including location, depth, fluid properties, and pressure and temperature
- Quality of appraisal performed on the reservoir and remaining development uncertainties
- Preferred recovery mechanism
- Well-placement preferences and well-design complexity
- Host processing requirements
- Full-life reservoir-management requirements
- Oil storage requirements
The fundamental starting point for selection of a dry- or wet-tree host relates to the underlying resource-bearing reservoir—specifically the location, physical reservoir properties, preferred recovery scheme (including well numbers and types) to be adopted, and the approach to full-life reservoir management.
Location and Reservoir Characteristics
Areal Footprint. Larger single or vertically stacked reservoirs that can be effectively drained from one central location with directional wells are well suited for dry-tree host systems.
Reservoirs with large or irregular areal footprints where wells cannot reach key reservoir drainage areas from one centrally located host and clustered developments that aim to tie together multiple independent aerially dispersed fields into one development/host production facility are typically well suited to wet-tree host systems.
Seabed Topography and Shallow Subsurface Hazards. Wet-tree systems are also well suited to reservoirs that sit directly below significantly difficult or irregular seabed conditions that hinder directional drilling from one central location.
Reservoir Properties. Regarding reservoir conditions, pressures, temperatures, and fluid properties are worth noting. As reservoir pressures and temperatures surpass today’s proven technology limits, choices related to wet- or dry-tree systems will become more critical.
For example, high-temperature operations may lead to a preference for wet trees as a method to facilitate fluid cooling.
Oil and Gas Export Infrastructure. Finally, a further consideration is the availability of access to oil and gas export infrastructure in the area. While this is generally not a problem in the Gulf of Mexico, frontier areas, such as French Guiana, or single-company-dominated areas, such as Brazil, pose significant challenges and costs to deploying dedicated offshore storage and single-asset export pipelines. In the majority of these cases, FPSO developments will prevail, allowing for both integrated storage on one vessel and oil offload and sales into international markets. This, of course, pushes the operator firmly to a wet-tree solution.
Well Number and Complexity and Intervention Requirements
Well count and well cost have traditionally been seen as key selection criteria of wet- or dry-tree systems. In addition, well-intervention requirements play a key role, principally driven by the increased costs of deepwater subsea well intervention using high-cost deepwater drilling rigs. However, the paradigm of increased well count and more intervention intensity favoring a dry-tree solution and lower well count and less intervention intensity favoring a wet-tree solution is becoming increasingly blurred.
Well-Construction Complexity. Historically, the requirement that a large number of wells be drilled from a single drill center favors a dry-tree system. The large number of wells from a single drill center can be the result of a compact reservoir, compartmentalization, or tight well spacing to improve recovery. Similarly, a small number of wells per drill center typically points toward a wet-tree system. The smaller number of wells can be the result of a well-connected reservoir with large drainage areas per well, an aerially dispersed reservoir, or cluster development.
Recent increases in well complexity driven by pushing the frontier in terms of water and reservoir depth and reservoir pressure and temperature challenge this historical deepwater perspective. The number and weight of the casing strings required to safely reach the reservoir objective drives up the capacity, hookloads, and, consequently, the size and payload of the drilling rig. Given the high upfront cost of a highly capable rig and cost to the host to accommodate it, a higher number of wells will be required to offset this upfront investment. This suggests that the default option for a small number of complex wells will be a wet-tree system and, for a high number of less-complex wells, will be a dry-tree (or wet-tree DVA) system.
Well-Intervention Complexity. The complexity of well intervention is another key consideration. Ultimately, the effect of the decision related to well numbers and intervention requirements needs to be made on the basis of two key factors assessed in the context of the project economics: (1) upfront well costs and the cost of future intervention and (2) the uncertainty related to reservoir performance and level of comfort around the required number of wells.
Fig. 2 shows the costs for a typical deepwater host supporting both wet- and dry-tree systems (dotted line) along with the lifecycle cost of corresponding incremental wells (solid lines indicating initial costs plus future intervention costs).
This simple analysis shows that, while the wet-tree host without an integrated drilling rig comes initially at a lower cost, an increasing number of wet-tree wells drilled and intervened upon through a dedicated deepwater drilling unit soon reaches the same overall system cost of a dry-tree host system with an integrated drilling rig—in this case, approximately 11.5 wells for normal intervention requirements.
The exact slope of these cost curves and break-even point between dry- and wet-tree solutions is a function of the actual water depth, overall payload, and frequency of well-related intervention required.
This article, written by Special Publications Editor Adam Wilson, contains highlights of paper OTC 24517, “Deepwater Development: Wet or Dry Tree?” by D. Reid, M. Dekker, SPE, and D. Nunez, Shell, prepared for the 2013 Offshore Technology Conference Brasil, Rio de Janeiro, Brazil, 29–31 October. The paper has not been peer reviewed. Copyright 2013 Offshore Technology Conference. Reproduced by permission.