Delivered an upstream CSG appraisal pilot project at a circa 2008 (pre-boom) cost benchmark

Delivered an upstream CSG appraisal pilot project at a circa 2008 (pre-boom) cost benchmark.

The Background

While working for BHP in the height of the resources boom (2013) Siecap’s Executive Director – Energy delivered an upstream CSG appraisal pilot project at a circa 2008 (pre-boom) cost benchmark. This was achieved while maintaining petroleum industry standards compliance and an impeccable health, safety and environmental compliance record.

The appraisal pilot consisted of 4 vertical producing wells connected to 6 ~1800m lateral in-seam wells and associated SCADA-equipped wellhead and pipeline infrastructure.

How the Siecap team helped

Appoint accountability: Provided effective decision-making across the multi-disciplinary project aspects. Where this couldn’t be achieved within the operating corporation, it was embedded in the contracting strategy.

Drive HSE Discipline: Commitment to the principle that HSE discipline is a proxy for operational discipline. Productivity performance can only be achieved with HSE performance.

Adopt a Strategic Risk Management Approach: Recognising that the risk profile is different for each field and reserve base and cost benchmarks can be materially improved by adopting risk-weighted standards.

Source and Retain Talent: Selecting the right people, with multi-disciplinary skills and experience can fundamentally improve project HSE & cost performance.

Foster Innovation: Embracing innovation in plant & equipment selection.

Embed Contingency into Planning Processes: Recognising that in a CSG reservoir, geology and production modelling will be wrong. How you plan for variances is the key to optimised field performance.

Be Intimate with your Reservoir: Incorporate incremental ‘contingent’ reservoir learnings to the point of intimacy.

Structure Contracting Strategies: In a way that incentivises performance, reduces waste and controls commercial risk.

The Results

Even with (relatively) expensive lateral well designs, the project realised an effective unit operating rate of circa AUD$4.00/GJ; a feat made even more significant by the fact the project was targeted in an extremely low producing coal seam with sub 1 millidarcy permeability exploration results.

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