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Part 2:
The other test's I envisage them doing during these first 3-6 months are interference tests between the 2 wells. By flowing one well only and observing how the BHP of the off-line well (which is effectively the reservoir pressure at that distant location) they can further build up the picture of how the wider reservoir is reacting... And then when the producing well is shut off, the BHP recovery from the offline well gives yet more data.
All this data will allow them to fine-tune their computer Reservoir simulation models. If they can match their model to the way the real thing performs over a 6-12 month period, they can be much more confident that it will provide more accurate predictions over the much longer timeframe, and hopefully for their wider FB acreage.
Being "allowed" to run these rate reducing data-gathering tests, rather than having to operate at maximum rate (in order to pay off debts and/or shareholders) is a VERY RARE luxury for a production field. A clear reason why this is called an EPS rather than a First Phase development. This is the benefit of having the geologist Dr. T firmly in the driving seat.
The value of information (which is often somewhat difficult to accurately quantify) is clearly regarded as being higher than the value of the additional oil (which can be very accurately calculated)..
Sorry to have "gone on" a bit, but hopefully it will have answered many others' questions of "why can't we increase the rate sooner?
Of course, it's all JMHO.
edit to add - whitegold, yes, aduk is one of the few over there worth listening to. (Always trust a fellow speleologist!!).. a pity he doesn't post here..
Here's Part 1 of Steve73's reply to Aduk from Advfn, apologies for length but useful for many to read:
awkward1 (adouble??). bounty interpreted my comments correctly.
The 72 hour contractual "test-run" won't (or is unlikely to) be a "start/run-for-72-hours/stop". Operation.
Once all their tests on the wells and topsides (and I'm still expecting a "dummy" offload - i.e. position using DP & connect up to a shuttle tanker, but no actual transfer - to be part of this testing), and both wells are online at the design rates, they will simply declare that a stable 72 hour period has been achieved. They won't necessarily shutdown production again at the end of it.
But then I'm not expecting them to keep running "forever" at that stage. They have already stated that the first 3 months of operation is expected to average 6.5 kbod, which is equivalent to one well operating 100% of the time at the minimum flowrate (to avoid low temperatures in the flowline), or 2 wells operating at design flowrate for just 32.5% of the time. Whatever they're planning lies some where between those 2 extremes. For the next 3-6 months they've stated they intend to operate at 13.5 kbod average. These "reduced" rates are very unlikely to be due to any constraint imposed by either well performance or operational topsides issues, but a desire to gain information & understanding.
What follows is my understanding of what they're hoping to achieve, and why. My background is not subsurface, although I've worked closely with enough different teams to understand some of their needs for evaluating reservoirs.
When you flow a well at any given rate, the bottom hole pressure or BHP (usually measured at the heel of a horizontal, rather than the toe) immediately drops. The difference between this and the reservoir pressure is the "drawdown" and is used to calculate the IPR (Inflow Production Rate). Shut off production and the BHP should very quickly balance out to the original reservoir pressure. The drawdown will normally exhibit a fairly linear relationship with production rate.
But with extended production over time the BHP will steadily drop as the immediate surrounding reservoir gives up its production, and the rate of this pressure drop depends on how much pressure support there is from the wider surrounding reservoir, or from a gas cap (which Lancaster does not have) or from an underlying aquifer (which HUR believes it does have). Shut in production at this stage and the BHP will take much longer to stabilize (since a wider area of reservoir was depleted), although eventually it should return to the original reservoir pressure. The longer you run and the more oil you produce, the longer it takes for the pressure to fully recover. These extended PBU test will give valuable information as to the wider reservoir characteristics, and more importantly the strength of the aquifer support (which may determine if supplementary water injection is necessary for the FFD's).
Adult,
Fully agree that Steve73 has got it near enough right. Just to add my bit, the tests described are essentially the same/similar to a DST. In the long distant past I analysed DST pressure charts to calculate all manner of things including porosity and permeability, and analysts will have moved on enormously by now. Essentially it is the shape of the pressure build up curve after a steady flow period that defines these characteristics.
Btw just show how old I am now, those chart calculations were made using a hand calculator, not quite an abacus, but not far off!
Partly in reply to my own comments here (which I copied over to the other BB), Steve73 has posted again at some length on ADVFN.
Highly recommended reading.
The expected startup profile is here at p9.
https://www.hurricaneenergy.com/download_file/force/457/222
It may of course be varied, but it's the best guidance we have.
ADUK - Pretty sure (99.9%) what I was told was correct. Took time to check Bristows’s site and noted flight from AM landed not that long before I was told. Like you I thought it made sense given Monday’s RNS. WW - Blatant lies or insider information, get a grip. Had no intention of posting what I was told until Steve37 post was copied to this BB and felt it worthwhile as his assumption was incorrect and seems to be supported by another poster. Think it’s time for this poster to watch his investment grow, without the need for comment.......
I very much doubt this is the post of paparazzi staking out the heliport AK. As a sensible man I’m sure you’d not argue that.
wellwell,
"This is either blatant lies or inside information."
Or just 'good journalism'.
In some repects, to the shareholders, a company CEO is rather like a 'public figure'. Or a 'celebrity', if you like. If Dr T was spotted at the heliport and someone remarks on it, what skin is it off your nose, anyway?
Furthermore, it's quite reasonable information. Good to know Dr T is keeping close to operations, as usual.
I'd personally might ha²ve become upset had I heard learn that during 'introduction of hyrocarbons' to 'our' FPSO, the CEO had been seen at Wentworth golf course and then in the evening at Stringfellows...
This is either blatant lies or inside information. Neither of which are acceptable.
""Don’t think so. Was told he was seen leaving Bristows last Wednesday""
Correct, Dr Trice spent two days on the AM last week.
AD : PM
Rangers, I don't try to keep track of Dr T's movements, though I suspect his presence at the heliport doesn't go unnoticed! But if your info is correct, it makes lots of sense. RT seems to be a very 'hands on' CEO. And that he was out on the FPSO for 'introduction of hydrocarbons' is thus no surprise. But for the follow-up, no. There are no rocks involved, he's not a 'production hand', and he's got an AGM to prepare, anyway!
From Steve37 post “although in our case I would suspect our most senior guy will be enjoying a cruise during this critical event (on the AM).” Don’t think so. Was told he was seen leaving Bristows last Wednesday.
Returning to my computer, because there's a bit in Steve's post I don't quite agree with. (I'll copy this over on ADVFN after I've finished here, so Steve can see it there.)
"So if it were me, I would plan to commence the "test run" (although with production already having been underway for a day or 2) on the Wed (29th), with a scheduled finish 72 hours later on Sat."
Personally, I don't see the 72 hours as some sort of 'test run' with a 'finish'. The company has said announcement of FoiL after 72 hours' stabilised flow with both wells online. In other words, 72 hours at a stable production rate. But that means we're 'in business'. We're now producing and making money properly. So why stop? Sure, the company has advised that downtime is likely to be greater during the initial periods, and that's to be expected as the equipment is properly bedded-in for the longterm, pigging intervals are decided, and more data-gathering is in progress.
But other than that, they aren't going to be playing 'start-stop' for months to come.
Steve73 post I'm sure he will not mind as we all want the same outcome. If he does I appologies now :0) Proving" test-runs offshore are often scheduled over a weekend. There are usually less disturbances from the on-shore support managers continually phoning up and asking "How's it going?", although in our case I would suspect our most senior guy will be enjoying a cruise during this critical event (on the AM). The schedule for our "First-Oil" event is during H1, so there is little benefit in it being a few days either way from the "much anticipated" 3rd June RNS, other than it'll be great to have the news confirmed for the AGM, and as others have righty pointed out, they probably wouldn't want to issue the RNS on the actual morning of the AGM. My estimate for the works still likely to be required following the "introduction of HC's" was at least 2 weeks before they could be in a position to commence the 3 day test run, taking us to next weekend, and so giving them a clear week to schedule the 3 day run. Remember though, just because the "run-period" has been started, doesn't mean they won't be producing beforehand. It's even possible they'll be operating steadily for a few days beforehand, and then "pick" the appropriate 3-days anytime during such a suitable period. Obviously BW will be pressuring them to commit, since they then go on to a day-rate contract (and they "win" any funds still left in the lump-sum contract), but again there will be some flexibility in these discussions, especially with the future possibilities being at the forefront of their minds. So if it were me, I would plan to commence the "test run" (although with production already having been underway for a day or 2) on the Wed (29th), with a scheduled finish 72 hours later on Sat. Any leaks (of information obviously) during the last 12 hours or so couldn't affect market trading, so there'd be plenty of time over the weekend to disseminate rumours before a market announcement on the Monday. Also, any delays (of up to a day or so) in formally starting the test period, would not affect their ability to announce at 7am Monday. They will almost certainly update progress on the Warwick Deep drilling during the AGM, although any material news would require to be announced separately beforehand. I'm not familiar enough with the proposed drilling activities to comment on where they could be by now or by the date of the AGM. I'm certainly looking forward to the next couple of weeks, even though there'll probably be concrete news (other than WD). We can expect lots of "positioning" posts, so I would warn readers to believe nothing they read here.. and the irony of that comment doesn't escape me...!
Thanks for the link Bartlebobton. Some solid reasoning there.
Does anyone else find ADVFN's HUR board very difficult to access consistently? I always seem to land on any one of 3-4 different type of view, different fonts, latest posts at top, sometimes bottom of page, graphs & links everywhere, and find it difficult to just access the most recent posts.
Is there a simple way to just read the most recent post of ADVFN?
Yes, Steve's post on ADVFN is interesting and worth a read.
I think the point underlying it is that regarding timings. The idea about 'testing' during this start-up period being that it can be very much planned ahead: 'choreographed', in a way. There's a huge difference between what's happening now on the AM and a DST on a rig, where the rig is costing dayrate, likewise the test spread and personnel, and where there may be weather issues to take into consideration. Here, the FPSO's not going anywhere else. So First Oil (and the RNS) can possibly be timed (including contingency to allow for any hiccups) quite closely, and maybe for some 'dramatic effect'.
Once First Oil has been announced, the reservoir engineers can go back to 'playing around with' the wells to their hearts' content, because nobody will be noticing!
I now wouldn't be at all surprised to see the FoiL RNS on Monday 3rd, two days before the AGM.
thank you for the info.
Generally - expecting 3 day test to start May 29th. That give 2 weeks to continue prep, which may include producing oil for more then 3 days (although expect pressure from the FPSO provider to move over to day rate). It also means nominal completion on Saturday, so there's a day or so leeway if issues emerge and completion is on a weekend still allowing RNS on Monday 3rd June. I hope I did Steve73 justice there - also there's a fair bit more interesting info in his post.
any chance you can repeat the gist of it here?
the other site doesn't like my ip adress for some reason.
steve73 is a top poster. Always read his stuff on ADVFN. Shame he doesn't post over here as it would save checking over there every now and then. laserdisc is another of the good guys.
The correlation between percentage open compared to flow may not mean much. These are very rarely linear. In many cases there may to zero flow until opened to 5-10% and then almost 100% flow at 60-70% depending on differential pressure across the choke. Google "quick opening valve" as this graph is closest match to my experience of choke behaviour but may not be the case with Aoka Mizu. Also, there will be a subsea choke but also possibly a topside choke as well so two stages of let down.
Here's the link... re Moonlanding's suggestion.
https://uk.advfn.com/cmn/fbb/thread.php3?id=31347119&from=47300#firstpost
Couldn’t agree more. Learned a lot from it.
Serious investors should read post 47300 over on Advfn by Steve73.....