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Shivhare S.,Palantir Economic Solutions | Kuru E.,University of Alberta
Journal of Petroleum Science and Engineering | Year: 2014

The colloidal gas aphron (CGA) based drilling fluids are designed to minimize filtration loss by blocking the pores of the rock with microbubbles. Aphrons behave like a flexible bridging material and form an internal seal in a pore-structure, which can later be removed easily when the well is open for production. A non-aqueous CGA fluid was formulated by mixing 0.4% W/W oil soluble surfactant (sorbitan fatty acid ester ) and a 1.5% W/W linear polymer (styrene-ethylene-propylene) with mineral oil at a very high shear rate. The CGA fluid was used in a series of core flooding experiments to see the effects of the fluid injection rate, the type of saturating fluid, and wettability of the porous media on the pressure drop across the porous media and return permeability. Effective pore blocking ability of CGA fluid was confirmed by ever increasing resistance to the injection of CGA fluid through the porous media (i.e., continuous increase of pressure drop across the porous media). Results confirmed that microbubble buildup has occurred in the porous media, which limits the fluid invasion. The permeability alteration, measured as an indication of the formation damage due to CGA fluid flow, was found to be variable. © 2014 Elsevier B.V. All rights reserved. Source

Willigers B.J.A.,Palantir Economic Solutions | Hausken K.,University of Stavanger
Energy Policy | Year: 2013

The 2011 UK tax rise on hydrocarbon exploitation activities obviously increases short term tax revenues however the longer term effects are less clear. The strategic interaction between the UK government, a producer and a shipper has been analyzed in a game theoretical model. A complex interaction between players is expected given (1) dwindling resources and large decommissioning liabilities and (2) the fact that much of the hydrocarbons produced in the North Sea are exported through an infrastructure with shared ownership.The 2011 UK tax adjustment will most likely result in value destruction for the government, producers and shippers. Our analysis suggests that governments are unlikely to ultimately benefit from reducing their decommission liabilities at the expense of International Oil Companies. In countries with unstable tax regimes, such as the UK, International Oil Companies will adopt their strategies in anticipation of future tax changes. Their adopted strategy is a function of decommissioning liabilities and remaining reserves as well as whether they are producers, shippers or producers and shippers. The ultimate payoff of a government is a function of the remaining reserves and total decommissioning liabilities, but also depends on the distribution of these value metrics between producers and shippers. © 2013 Elsevier Ltd. Source

Willigers B.J.A.,Palantir Economic Solutions | Hausken K.,University of Stavanger | Bratvold R.,University of Stavanger
Journal of Petroleum Science and Engineering | Year: 2010

Decision making in the capital-intensive upstream oil and gas industry is complex for several reasons. One is the uncertainty of the investment opportunities. Another is that many projects are developed in joint ventures, in which stakeholders with potentially contrasting preferences must reach mutual agreements on the decisions at hand. In order for players to be successful in a joint venture, each player should understand the preferences, the positions, and the exposure of all other players.This study provides insight into the type of strategic interactions to be expected in typical joint-development programs in the upstream oil and gas industry. The decision situation considered involves a joint venture of three oil fields connected by a shared infrastructure used to export the produced hydrocarbons. A game-theoretic framework has been applied to analyze the relationships among players' preferences, uncertainties resolution, and commercial drivers. An improved understanding of the evolution of the players' project perspectives during the project development period will enable decision makers to be much more effective in influencing the project to their advantage. Understanding the preferences and tradeoffs of all of the joint venture participants will lead to improvements in selecting investment alternatives, timing and order of the investments, and the mitigation project upsides and downsides. © 2010 Elsevier B.V. Source

Willigers B.J.A.,Palantir Economic Solutions | Willigers B.J.A.,BG Group | Weis F.,Palantir Economic Solutions | Majou F.,BG Group | Majou F.,SOCAR
SPE Economics and Management | Year: 2013

This study demonstrates how portfolio insights can be created by combining well-known optimization methods that are generally used individually-genetic algorithm (GA), linear programming (LP), and portfolio filtering (PF). An integrated optimization approach combines the advantages of individual methods while mitigating their shortcomings. Effective portfolio management requires a comprehensive understanding of the tradeoffs between different portfolio choices. Given a set of constraints, portfolio-optimization techniques based on LP and GAs can be applied to identify an optimal portfolio. However, this optimal portfolio might not be the preferred portfolio. Decision makers have to understand the tradeoffs between generally conflicting objectives and constraints before one portfolio can be identified as the preferred option. Such assessment of the overall search space is not made with LP and GAs when used to identify a single best solution, and many portfolio options will have been eliminated before an understanding of these alternatives has been developed. Markowitz's mean-variance (M-V) approach and the traditional "rank and cut" approach are used typically to establish a relationship between a portfolio's value and its variance or associated development cost. Although these methods enable decision makers to compare and contrast different options, the optimization is limited to the portfolio value measure and a single other metric. This latter limitation is overcome by the more recently developed PF approach. This method is practical and transparent and allows for a quick development of strategic portfolio alternatives while considering a large number of portfolio attributes. Its main drawback is that the analyzed set of portfolios generally represents a subset of the total search space. Thus, as the number of feasible portfolio options increases, so does the chance that the optimal portfolio is not present in the population of sampled portfolios. Copyright © 2013 Society of Petroleum Engineers. Source

Willigers B.J.A.,Palantir Economic Solutions | Begg S.H.,University of Adelaide | Bratvold R.,University of Stavanger
SPE Economics and Management | Year: 2011

Natural gas and electricity are commonly traded through swing contracts that enable the buyer to exploit changes in market price or market demand by varying the quantity they receive from the producer (seller). The producer is assured of selling a minimum quantity at a fixed price, but must be able to meet the variable demand from the buyer. The flexibility of such contracts enables both parties to mitigate the risks and exploit the opportunities that arise from uncertainty in production, demand, price, and so on. But how valuable are they? Traditional net present value (NPV), based on expected values, cannot value this flexibility, and the traditional options/valuation techniques could not model the complexity of the terms of such contracts. Taking gas contracts as an example, this paper seeks to (a) raise awareness of how flexibility creates value for both parties and (b) show how least-squares Monte Carlo (LSM) simulation can be used to quantify its value in dollar terms, from the perspective of both producer and buyer. Because the value of flexibility arises from the ability it gives to respond to fluctuations (e.g., in commodity prices), a useful model of swing contracts needs to reflect the nature of these fluctuations. Copyright © 2011 Society of Petroleum Engineers. Source

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