OG21 TTA2 “What can change the game? Exploration and Reservoir haracterization” 13 February 2008 Norwegian Petroleum Directorate How can OG21 make a difference?

OG21 TTA2“What can change the game?

Exploration and Reservoir haracterization”13 February 2008

Norwegian Petroleum Directorate

How can OG21 make a difference?Alfred Nordgård, OG21 and Shell

OG21 – Oil & Gas in the 21st Century

Main Objectives

Develop new knowledge and technology to ensure economic

and environmentally sound development of the resources on the Norwegian Continental

Shelf---------

Strengthen the industry’s competitive advantage in a global

market by developing new and attractive technology products

and systems

Key Challenges - NCS

Sensitive Arctic RegionsHSE StandardsIndustrial Infrastructure

Sensitive Arctic RegionsHSE StandardsIndustrial Infrastructure

Gas to MarketLNG/ GridGas to MarketLNG/ Grid

Deep WaterReduce CAPEX Deep WaterReduce CAPEX

Mature Areas, EOR/IORLife of InfrastructureProduced Water

Mature Areas, EOR/IORLife of InfrastructureProduced Water

Stranded Oil & GasSmall FieldsTail Production

Stranded Oil & GasSmall FieldsTail Production

Revised Main strategy

Sub-strategies have been established

•Environmental technology for the future •Exploration and reservoir characterisation•Enhanced recovery•Cost effective drilling and intervention•Integrated operations and RTRM•Sub sea processing and transportation *)•Deep water and subsea production technology *)•Gas technologies

*) only Demo2000 projects

Technology strategy for the Arctic

September 2006

Contributors to the OG21 process

Organisational model

Research and Development

Demonstration and piloting

Norwegian Technology

Advanced drilling technology

Troll Oil:New technologies unlocks reserves and value

Jukselapp: US$ 60 * 1400 mln bbl = NOK 500 000 mln

Ny jukselapp: US$ 90 * 1400 mln bbl = NOK 750 000 mln

Ormen Lange – Subsea to Beach

• More oil and gas production than expected

• Increased recovery

• Decreased costs

• Increased income to the community

R&D is worth while

Goal for EOR Recovery factor

Todays plan is 55%

OG

21 s

trate

gy

Future drilling: BADGER EXPLORER

“Long-term scenario”

“Decline scenario”

Source: MOE

Production scenarios

Source: NPD

NPD’s 2007 scenarios:

We are on the right track..

Increased funds to fundamental and basic research

R&D investment – approx 50/50 share between competence and user driven R&D.

Basic and fundamental research in

technology and natural science

Pu

blic

fu

nd

ing

(M

illi

on

NO

K)

2005

300

600

1200

Competence build and basic R&D in specific TTAs

2010

R&D investment – approx 50/50 share between competence and user driven R&D.

Basic and fundamental research in

technology and natural science

Pu

blic

fu

nd

ing

(M

illi

on

NO

K)

2005

300

600

1200

Competence build and basic R&D in specific TTAs

2010

Demo2000Petromaks

Universities Industry

But – a marked dimension:

Evolution of Government R&D funding

Funds have increasedsince early 90’ – butwhat about the future?

0

50

100

150

200

250

300

350

400

450

MN

OK

Samfunnsfagligpetroleumsforskning(OED)HMS ipetroleumsindustrien(AID)Demo2000 (OED)

Effekter av utslipp tilsjø (OED, MD)

Brukerstyrt/anvendtekskl Petromaks(OED, NHD)Petromaks (OED,NHD, forskningsfondet)

Strategiskpetroleumsforkning(OED, NHD, KD)SFF CIPR UiB(Forskningsfondet)

2007 - 2008 - ?

Major contribution to the economy

328

771

275

117 112 104 9326 24 17

1036

0

200

400

600

800

1000

1200

I nco

me

Expe

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Tryg

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Hel

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dann

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Annen

Olje

inv

Andre

Rente

r

265mrd.kr Oljefondet2467 mrd.kr

National budget 2008

bln NOK

OG21 as a centre in the process

Industry Academica

Institute Authorities

UniversitiesCollegesNational oil companies

International oil companiesSupplier industry

Ministry of Oil and EnergyPetroleum DirectorateResearch Institutes

Positive effect on production and export

-

Export oftechnology

Added value from gas

New areas

Increased recovery

Fields in production

2006 2020

CoordinatedNational R&D efforts Obtained by

Increased R&D

Roadmap for the future

OG21 Vision

Our vision is a sustainable Our vision is a sustainable petroleum industry for the petroleum industry for the next 100 years based on a next 100 years based on a cooperative approach to cooperative approach to knowledge and technology.knowledge and technology.

Thank you for your attentionThank you for your attention