Standardization Lead to Potential Cost Saving in the One of the Clusters in Southern of Sultanate of Oman

Abstract

This paper is for people to realize a strategic way of continuous improvement though optimization and standardization process with a minimum of 10% target cost reduction while developing capability in the organization in the south of Oman. BN area is one of the main production areas in PDO (Petroleum Development of Oman) and is being operated under BR cluster from 1980s. Approximately eleven fields in the BN area are contributing to the success today. Continuous improvement through optimization and cost reduction has always been a top priority, where long term production and safety has been fulfilled. In 2020, this team has been put together to look into the overall cost saving potential with the clear management steering of "Do not Leave any Stone Unturned". A mixture of experience and young team members are retained to ensure capability development in the organization. One of the key items that this team looked at is to standardize of upcoming Oil Producers and Water Injectors well design. The well design in at least 7 fields in the BN area has been reviewed and realized the value and risk through competitive scoping exercise. By avoiding looking at the fields in isolation, the team has considered a similarity of well functionality and had identified where the standard well design can be applied. Minimum functional requirements lead to minimum technical specification and building into a staircase of option with clear associated risk for each option. Through the analysis, a potential optimization of an existing well design has been discovered and is currently undergone further maturation toward design endorsement. With the maturation of the uniformity of well design in the area, it is foreseeing as an opportunity to ensure improvement can be sustained in the long run. Minimum 10% saving of well cost through standardization and efficiency in project management is a target set, aiming to provide stability in planning. In addition, the team are looking into even more than 10% cost saving through innovative contracting strategy. It could potentially help to speed up the delivery of the project, accelerate production with less waiting time i.e. improve material stock management, simplify procurement process, ensure that the experience remains in the organization and will allow for replication in the future. The approach involves a combination of integrating team from subsurface, surface, wells, contract, and procurement to enhance cost saving to the company. This has proven to be effective and aligned with the company's focus to consolidate a commercial mind-set thinking in each development.