Allomax Subsea

The BP Deepwater Horizon Disaster

What Happened?

Will it Happen Again?

www.allomax.com

Staff

Recruitment

ROV Operations

Asset OptimisationRecruitment

Agency Services

Operations

SubseaPersonnel

Optimisation

Risk Management

Competence Assurance

Track Record Over 250 projects (Subsea Examples)

• Potential major incident (confidential)– Shut in production for riser replacement or not?– Commence relief well or not?

• >100 field evaluations for acquisitions• Total Dalian Angola

– Risk Assessment – Xmas tree deployment over live pipelines / subsea infrastructure– Marine traffic / simultaneous operations– Subsea vs MMFP– Subsea vs MMFP

• BP Foinavon & Shiehallion– ERD vs Drill Centre Optimisation– 3rd Generation vs 4th Generation Semi– Daisy Chain vs Star Configuration– Chance of Submarine Collision– Marine Architecture design for over trawl

• Conceptual Field Design Optimisation– Kiame Angola, Tilapia Congo (Ranger)– Zhoa Dong (Apache China), Espoire (Halliburton Cote d’Ivoire)– Harding (BP), Claymore, Auk North (Talisman)– Jasmine (ConocoPhillips)– Shiehallion & Foinavon (BP)

MACONDO DISASTER GOM

BP - Seven Mechanisms Under Investigation

1. The cement that seals the reservoir from the well;2. The casing system, which seals the well bore;3. The pressure tests to confirm the well is sealed;4. The execution of procedures to detect and control

hydrocarbons in the well, including the use of the blowoutpreventer (BOP) and the maintenance of that BOP; -Cameron Failsafepreventer (BOP) and the maintenance of that BOP; -Cameron Failsafe

5. The BOP emergency disconnect system, which can be activated by pushing a button at multiple locations on the rig;

6. The automatic closure of the BOP after its connection is lost with the rig, and;

7. Features in the BOP to allow ROVs to close the BOP and thereby seal the well at the seabed after a blowout.

BP Accident Investigation

Report

BP Deepwater Horizon Accident Report Findings

1. The annulus cement barrier did not isolate the hydrocarbons.

2. The shoe track barrier did not isolate the hydrocarbons.

3. The negative-pressure test was accepted although well integrity had not been established.

4. Influx was not recognised until hydrocarbons were in the riser.riser.

5. Well control response actions failed to regain control of the well.

6. Diversion to the mud gas separator resulted in gas venting onto the rig.

7. The fire and gas system did not prevent hydrocarbon ignition.

8. The BOP emergency mode did not seal the well.

8

What Went Wrong?

• Risk Management?

• Competency?

• Design?

• Supervision?• Supervision?

• Maintenance?

• Adherence to Corporate Processes / Procedures / Standards?

• Culture / Behaviours?

Eight Areas of Industry Concern

1. Risk Management discipline / analysis2. Well design approval / checks3. Personnel competency / training / development4. Roles & Responsibilities of key parties

a) Rig / Operatorb) Statutory Authorities / Operatorc) Subcontractorsc) Subcontractors

5. Audit & Supervision of key contractors6. Financial capability of Operators7. Disaster recovery

a) Industry oil spill response technologyb) Industry ‘fund’c) Government responsibility / input

8. Insurance availability / costs & procedures

EXAMPLE – MACONDOCASING DESIGN

Good Practice – High Tech Wells

• Stage Gate Approval Process– Outline Well Design Option Analysis– Outline Risk Assessment of Options

• Contractor Input– Free and open criticism

– Detailed 3 Party Risk Assessment of Options– Free and open criticism

– Detailed 3rd Party Risk Assessment of Options• Simulate disaster outturns for High Tech wells

– (Market Capitalisation impact)

– Design Peer Review– Detailed Design of Selected Option– Casing / Completion Design Review for High Tech Wells

Liner vs Long String

Internal Leak Path

6. Cement Plug?

2. Cement

1. Float Shoe

3. Float Collar

4. Cement Plug?

6. Cement Plug?

5. Bridge Plug?

Annular Leak Path

3. Seal Assembly?

1. Cement

2. Liner Seal Assembly

3. Liner Top Cement Plug

4. Fluid Column

5. Cement Plug

1. Cement

2. Fluid Column

Risk Management

Hold Risk Sessions:

• Concept Selection

• Detailed Design

• Operations• Operations

– Tornado Charts

– Boston Square

– Management Reports

• Comparison of projects

Tornado Chart

Boston Square

Management Monitoring

Treemax Risked Option Analysis Tool

• Monte Carlo simulator behind a modified decision tree

• End results of each branch represent

– chances of getting there – chances of getting there

– likely costs / time / impact

• Graphical comparison of all options against each other

Risk Analysis 0.996. Facilities Success 63.02%

0.99 £42,526,8395. Run Set Comp'n OK £250,000 112

0.01818£6,794,798 0.01

0.95 40.07784667 8. Fail Facilities 0.64%4. Drill 8 1/2" OK 112.0773053 £42,776,839

£500,000 115£2,432,652 3.394784167

16.70949333 0.01£10,482,041 7. Fail Set Comp'n 0.64%

72 £43,487,413£8,005,372 118

46.129836670.99

30. Facilities Success 3.22%0.99 £101,673,222

0.95 29. Run Set Comp'n OK £45,000,000 1593. Drill 12 1/4" OK 1.411483333

£9,591,158 0.01£6,198,541 0.98 30.31784667 34. Fail facilities 0.03%42.5767853 28. S/T To Horiz OK £101,673,222

£45,000,000 158£7,545,308 0.01818

0.99 28.62677597 0.0127. Drill Vertical Subsea OK 33. Fail Set Comp'n 0.03%

£55,670,429£4,987,367 £8,588,365 158

18.92218 30.317846670.05 0.02

9. Fail Drill 8 1/2" 32. No Res / Fail TD 0.07%£40,990,406

£1,500,000 £1,453,650 10424.41616 5.51518

0.010.95 31. No Res / Fail TD 0.03%

2. Slot Recovery OK £42,813,754£8,264,364 102

£1,850,848 22.1224561412.71318 0.99

30. Facilities Success 3.39%30. Facilities Success 3.39%0.99 £95,474,681

29. Run Set Comp'n OK £45,000,000 1381.411483333

£9,591,158 0.010.98 30.31784667 34. Fail facilities 0.03%

28. S/T To Horiz OK £95,474,681£45,000,000 136

£7,545,308 0.018180.75 0.99 28.62677597 0.01

1. Platform Well 27. Drill Vertical Subsea OK 33. Fail Set Comp'n 0.03%£49,471,888

£25,000,000 £4,987,367 £8,588,365 1360.01818 18.92218 30.31784667

0.05 0.0216. Fail Drill 12 1/4" 32. No Res / Fail TD 0.07%

£34,791,865£1,500,000 £1,453,650 8345.7808367 5.51518

0.0131. No Res / Fail TD 0.04%

£36,615,212£8,264,364 81

22.122456140.05

25. Slot Recovery Fail 3.75%£25,000,000

£0 161 16.16083667

0 0.9930. Facilities Success 95.09%

0.99 £68,623,87129. Run Set Comp'n OK £45,000,000 82

1.411483333£9,591,158 0.01

0.98 30.31784667 34. Fail facilities 0.96%28. S/T To Horiz OK £23,623,871 £68,623,871

£45,000,000 80£7,545,308 0.01818

0.99 28.626776 0.0127. Drill Vertical Subsea OK £14,032,713 33. Fail Set Comp'n 0.97%

£22,621,078£4,987,367 £8,588,365 80

18.92218 30.317846670.02

26. Subsea Well 32. No Res / Fail TD 1.98%£7,941,055

£1,500,039 £1,453,650 272.48718 5.51518

0.0131. No Res / Fail TD 1.00%

£9,764,402£8,264,364 25

22.12245614

Option 1

Option 2

Deep Water Horizon Disaster

Annulus Leak PathLiner vs Long String

Liner

LongString

Comparison of Options (Results Confidential – Example Plot Shown)

Conclusions

• Existing systems in place to protect against recurrence

• Risk management appears weak– Risk Management is a Cultural Challenge of – Risk Management is a Cultural Challenge of great significance

• Questions over competency of key personnel in all major parties– Continuous Competency monitoring a major challenge

Can It Happen Again?

• USA’s Piper Alpha

– Extremely Unlikely Series of Events

– Extensive Investigation

– Fundamental Re-Analysis of Modus Operandi– Fundamental Re-Analysis of Modus Operandi

• High Tech wells especially

• Procedures / Technology & Designs available to avoid recurrence

• Extremely Unlikely to Occur Again