WIN WIN Joint Industry Project: Wind-Powered Water Injection

ENERGY WIN WIN Joint Industry Project: Wind-powered water injection

SAFER, SMARTER, GREENER 2 WIN WIN WIN WIN 3

A NEW ALLIANCE

“ENERGY AND PERSISTENCE CONQUER ALL THINGS” Water injection is a frequently used and highly effective means of increasing oil recovery – Benjamin Franklin from offshore reservoirs. It also entails high power consumption,Oil and gasand production costly infrastructure. Effect of water injection Floating offshore wind turbines are now in full-scale prototypevolumes testing, building on years of on recovery rates successful offshore wind experience. Costs are approaching competitive levels through The energy industry is in an unprecedented time of transition, endeavouring to supply the world with affordable, clean and reliable energy to meet the increasing demand. industry learning and technology development. Now, the developments in offshore wind offer new opportunities for the oil industry. Worth around “Let’s not waste a good crisis”, by this I mean that we have a great opportunity to get inefficiencies out of 500mUS$/day value chains. We should also put more emphasis on cross-industry collaboration. The challenges we face Oil and gas production Effect of water injection cannot be solved by the knowledge within one industry alone, so we must tap into the expertise from many Oil and gas production volumes Effect of wateron recovery injection rates industries. volumes on recovery rates 1/3 of global oil and gas The oil and gas industry has pioneered development and innovation for well over a century and brought production comes from Worth around 500mUS$/day us new technologies and knowledge and will continue to play a critical role in the world’s energy future. At offshore fields1 Offshore the same time renewable energy technologies are experiencing incredible growth rates. The costs of solar Worth around Primary production 500mUS$/day and wind power generation are being pushed down, as the market uptake expands, industries mature and Onshore technologies improve. The oil, gas and renewable energy industries are all part of the energy transition: Additional production from water injection a transition that can be accelerated when we join forces. Offshore Wind3X is the world’s fastestPrimary growing production energy source, Additional production Onshore and offshore wind capacity in Europe will triple from Additional production from other methods For the first time we can now see renewable energy as a large scale source of power to offshore oil and gas 2015–20204 from water injection operations. The WIN WIN (WINd-powered Water INjection) project shows how recent developments in Additional production Non-recoverable Offshore from other methods floating offshore wind turbines offer a clean, reliable, and cost effective alternative for powering water injec- Primary production Onshore Non-recoverable tion in offshore locations. A wind-powered water injection system meets the industry’s technical, functional Additional production and commercial requirements, offering a realistic alternative with unique benefits. Oil and gas production Water injection can increase Effectreservoir of water recovery injection rates by Offshore wind hasfrom a higher water load injection factor than many other Oil and gas production Effect of water injection Oil and gas production volumes Effect of water injectionon recovery rates Oil and gas production volumes upEffect to 50%, of leading water to aninjection increasedon recovery oil rates production worth renewable energyAdditional technologies. production Today, load factors for Through the WIN WIN project, the oil and gas industry, in collaborationvolumes with the renewable energy industry, on recovery 2 rates from other methods 5 volumes $500on recovery million, daily rates Average load factors floating offshore wind have attained upwards of 50% can become a creative force in solving the world’s ever increasing energy challenge, driving development AverageNon-recoverable load factors of new and clean technologies. This is a win for both the oil and gas and the renewable power industries. Solar PV 11 Worth around Worth500mUS$/day around Onshore wind 500mUS$/day29 Solar PV 11 DNV GL is driven by our vision of a global impact for a safe and sustainable future. Taking the lead in the Offshore wind 39 Worth around Onshore wind 29 development of new technology is at the core of our DNA, and WIN WIN is another contribution in this Worth500mUS$/day around context and will contribute to our common journey towards a safer, smarter and greener future. 500mUS$/day Offshore wind 39 Offshore Average load factors Primary production Offshore Primary production Onshore Onshore Solar PV Additional production 11 Additional production from water injection from water injection Onshore wind Additional production 29Additional production from other methods from other methods Offshore wind Non-recoverable39 Floating wind turbines enable deep-water wind farms, Offshore Non-recoverable Best regards, Primary production and the Hywind Scotland pilot project with five turbines OffshoreOnshore of 6MW capacity each will be a major step in the right PrimaryAdditional production production direction6 Onshore from water injection AverageAverage load load factors factors Additional production Remi Eriksen Additional production SolarSolar PV PV 11 Three barrelsfrom of water sea water injection is injected for every barrel 11 from other methods Group CEO, DNV GL of oil produced3 OnshoreOnshore wind wind 29 29 Additional production Non-recoverable OffshoreOffshore wind wind 39 39 from other methods Non-recoverable

Average load factors

Solar PV 11 Average load factors Onshore wind 29 Solar PV 11 Offshore wind 39 Onshore wind 29

Offshore wind 39 4 WIN WIN WIN WIN 5

THE CONCEPT WIN WIN is DNV GL’s concept for a new generation of oil recovery technology. Using a wind turbine to power a water injection system will reduce costs, increase flexibility, and reduce emissions.

BENEFITS

Feasible: The concept is, to a large extent, based on commercially off-the- shelf components and systems. Many of the remaining parts are already undergoing full-scale testing.

Effective: WIN WIN meets performance requirements for a wide range of injection volumes and multiple reservoir types.

Competitive: The concept can be cost-competitive, especially when the host platform capacity is limited or injection wells are located far away.

Green: Power to platforms is normally supplied with gas turbines. Reducing power demand from these by running water injection with wind power will reduce emissions considerably.

Flexible: The inherent flexibility of the WIN WIN concept means that more water injection locations can be targeted through easy relocation, regardless of distance to platform.

Innovative: Building on the strength of two industries, oil and gas joins forces with wind to achieve something greater together, enabling a faster transition of floating wind turbine technology to market. 6 WIN WIN WIN WIN 7

SYSTEM FEATURES PROCESS

Wind-powered water injection is based on known technology and is designed for off-grid, remotely controlled operations. The autonomous system is moored in immediate proximity to the injection wells.

1 Injection pump units x2 Wind turbine & tower Electrical Control system Other auxiliary Shaft crane System package system systems Chemical injection Hydraulic power unit 2 3 4 Filtration units x2 Control container WIND TURBINE

PROCESS SYSTEM Water inlet Water Injection pump treatment TO INJECTION WELLS 5 6 7

1 A standard wind turbine is mounted to a floating foundation. This foundation also serves as a platform for the water injec- 5 6 7 tion system.

2 An electrical micro grid enables controlled start-up and shut-down of the system, and ensures that power demand matches power supply during operation. 6 4 A battery bank ensures power to critical safety and commu- 1 nication functions during periods of no wind.

3 Communication with the host platform is enabled through Chemical storage Offshore davit crane satellite communication. A conventional control umbilical can also be used. Drain drum and pump Mechanical package Dump load unit Laydown area 4 The system uses sea water, which is pumped topside using Exit ladder to boat landing lift pumps. 3 Boat landing 2 5 The sea water is filtered down to 50 micron using a vertical disc filter with backwashing capability.

6 The water is treated with chemicals. Chemicals are stored on board in vessels, and refilled during other maintenance activities on the platform.

7 Water is injected into the reservoir by injection pumps. Positive displacement pumps are particularly suitable for the application, but centrifugal pumps are also feasible. 8 WIN WIN WIN WIN 9

FEASIBILITY

The WIN WIN concept has been assessed for technical and commercial feasibility. No COMMERCIAL technical showstoppers have been identified and wind-powered water injection is technically Capital expenditure feasible, capable of meeting performance targets and may offer a cost-competitive alternative to conventional solutions. Total CAPEX for the use case configuration with process equipment located topside comes to around 75 MEUR. The Wind structure Water injection system TECHNICAL FEASIBILITY A further key finding from the project is that for suitable fields, wind structure and marine operations and logistics are the Wind structure oil production and reservoir integrity are not affected by the two main CAPEX drivers, together contributing to more than Marine operations and logistics The WIN WIN concept builds on known technical solutions in a variable injection rates caused by wind fluctuations. 50% of CAPEX costs. The pump system and development DevelopmentWater injection costs system new application and configuration. costs are also significant in the overall investment. Potential OtherMarine operations and logistics for cost savings are particularly notable for the wind structure PERFORMANCE 0 20 40 60 80 Development costs Compared to a conventional water injection system from a host and marine operations and logistics as improved learnings CAPEX (MEUR) Other platform, there are two fundamental differences that influence The WIN WIN concept has shown that it can meet the demands from floating offshore pilot projects develop cheaper and 0 20 40 60 80 both technology choice and operations, and so they have been from an industry focused on performance. Key performance smarter solutions. Wind structure assessed in more detail in this project. issues addressed in the project include delivering required Water injection system CAPEX (MEUR) Marine operations and logistics injection volumes, understanding the reliability drivers, as well Development costs n First, the system is remotely operated with limited access as investigating start-stop cycles and downtime. Other for inspections and maintenance. 0 20 40 60 80 n Second, the system is driven by a variable power supply For the use case considered and others, WIN WIN exceeds CAPEX (MEUR) that causes variable water injection rates. target injection rates over time. There may be a further potential Wind structure to optimize availability, leading to higher achievable injection Operational expenditure Water injection system Parts and chemicals The unmanned system is powered locally and remotely con- rates for a given system configuration. Marine operations and logistics Vessel and staff costs trolled, with stringent requirements on high reliability to prevent To achieve a realistic estimate of the O&M cost and perfor- Development costs Parts and chemicals unscheduled maintenance. Injection volumes over time have been simulated based on re- mance, DNV GL has modelled the system taking into account Other Operator profit and risk margin alistic wind-data for the use case, showing that volumes exceed failure rates, repair times and0 wind and20 wave data.40 The 60 80 InsuranceVessel and staff costs CAPEX (MEUR) Parts and chemicals Simulations combined with knowledge from micro-grid applica- target rate, despite some periods of low wind. resulting annual average operation and maintenance costs Vessel and staff costs OtherOperator profit and risk margin tions in other industries provide assurance that the electrical and are on the order of 4,7 MEUR. Key drivers include parts, 0 Operator profit1 and risk 3margin 4 5 6 Insurance control systems will operate as intended. Thereby, the process chemicals, and vessel costs. Increased reliability of the sys- InsuranceAnnual expected costs (MEUR) Other equipment will experience nearly normal operations. tem would positively influence maintenance frequency and Other 0 1 3 4 5 6 0 1 3 4 5 6 +39% 1.2 80,887 scope, in particular for unscheduled maintenance, reducing 1.2 Annual expected costs (MEUR) Annual expected costs (MEUR) Wind losses operational expenditures. 1.0 Availability losses Parts and chemicals 14 day average 23,412 0.9 Quarterly Injected volume Vessel and staff costs 0.8 Target rate Operator profit and risk margin 7,472 0.6 90,000 Insurance 80,000 Target Other 0.4 70,000 0 1 3 4 5 6 injection (EUR/bbl)

60,000 Lifecycle cost per barrel of water, Levelized cost of water 50,000 Annual expected costs (MEUR) 0.2 40,000 WIN WIN vs alternative, EUR* 30,000 50,003 0.0 20,000 WIN WIN Alternative 10,000 The use case costs have been compared with a conventional +39% 1.2 Water injection rate (bbl-d) 0 1.2 CAPEX J F M A M J J A S O N D J alternative where water injection is accomplished with a flow Time (months) OPEX line from the host. While WIN WIN has higher operational 1.0 0.9 Decommissioning expenditures compared to a conventional alternative, the Wells 0.8 significantly lower capital expenditure means that it comes USE CASE7 out comparable in 20 year life-cycle comparison. WIN WIN is 0.6 The system is located in the North Sea, 30 km from the production host and 30 km from shore, at 200 metres water depth. therefore a commercially competitive alternative in a range The reservoir consists of two injection wells, with normal injectivity, and a target injection rate of 44,000 barrels of water per day. 0.4

of cases, and especially when host platform capacity is limit- injection (EUR/bbl)

ed or injection wells are located far away. Levelized cost of water SYSTEM SPECIFICATIONS7 0.2 A 6 MW wind turbine is mounted on a spar foundation, with 2 x 2 MW injection pumps, capable of a maximum of 80,000 barrels of 0.0 water per day. The process equipment is located topside. Water treatment includes filtration and chemical injection with chlorine, WIN WIN Alternative biocide, and scale inhibitor. * Only CAPEXincludes difference in well cost, full well cost not included OPEX Decommissioning Wells 10 WIN WIN WIN WIN 11

NEXT STEPS ABOUT THE PROJECT

The objective of the project has been to assess technical and The project commenced in 2015 and culminated early in 2016. economic feasibility of the WIN WIN concept for wind-powered DNV GL managed the project and performed the technical water injection. and commercial assessments. JIP partners contributed with expert opinions, as well as possible use cases and operational Deliverables include a comprehensive technical report available data to assess the concept according to their needs. to JIP participants. In addition, a high-level public summary report was commissioned to share main project findings and While the results indicate significant potential, the conclusions inspire further actions in the industry. are dependent on site-specific conditions. DNV GL encourages the industry to jointly move forwards in assessing the risks and validating the concept.

JIP PARTNERS:

FOR FURTHER INFORMATION, PLEASE CONTACT:

“WHEN THE WINDS OF CHANGE BLOW, SOME PEOPLE BUILD WALLS Are Kaspersen Johan Sandberg Project Manager WIN WIN Project Sponsor WIN WIN AND OTHERS BUILD WINDMILLS” [email protected] [email protected] – Chinese proverb +47 416 33 831 +47 918 77 047

1 From Infield Systems, 2013 – Global Offshore Oil and Gas Outlook 2 From Society of Petroleum Engineers, Enhanced Oil Recovery, D.W. Green and G.P. Willhite, SPE Textbook Series Vol. 6, Richardson, TX, USA, 2003. 3 Wind-powered water injection is a tangible solution achievable DNV GL believes that the WIN WIN concept can provide a From Argonne National Laboratory, Produced Water Volumes and Management Practices in the United States (2009) 4 EWEA, Wind Energy Scenarios for 2020 – Central Scenario (2014) in the short term. range of benefits across industry sectors, both in the offshore 5 Digest of United Kingdom Energy Statistics (DUKES), Renewable sources of energy: Chapter 6 (2015) oil and gas industry and the offshore wind industry. Joint tech- 6 Hywind Scotland Pilot Park, Retrived from Statoil.com, 15/02/2016 7 Validation of the system in a physical set-up is a probable next nology development brings additional promise because ideas Although other use cases and system specifications have also been assessed, the remaining figures in this report relate to this specific use case and specifications. step. The key objective would be to gain assurance that the and perspectives can be combined from different angles. As components integrated in this configuration will offer satisfac- such, this project is a real win-win. DNV GL and JIP partners do not assume any liability for the use of the results and conclusions found in this high-level summary report, nor the tory performance over time, and with a variable power input. comprehensive technical report. Several pathways are currently being explored to that effect. SAFER, SMARTER, GREENER

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