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Research Papers: Offshore Technology

Risk-Based Cost-Effectiveness Analysis of Waste Handling Practices in the Arctic Drilling Operation

[+] Author and Article Information
Y. Z. Ayele

Department of Engineering and Safety,
UiT The Arctic University of Norway,
Tromsø 9037, Norway
e-mail: yonas.z.ayele@uit.no

A. Barabadi

Department of Engineering and Safety,
UiT The Arctic University of Norway,
Tromsø 9037, Norway
e-mail: abbas.b.abadi@uit.no

E. L. Droguett

Department of Mechanical Engineering,
University of Chile,
Santiago 8370448, Chile
e-mail: elopezdroguett@ing.uchile.cl

1Corresponding author.

Contributed by the Ocean, Offshore, and Arctic Engineering Division of ASME for publication in the JOURNAL OF OFFSHORE MECHANICS AND ARCTIC ENGINEERING. Manuscript received December 18, 2015; final manuscript received January 22, 2016; published online April 1, 2016. Assoc. Editor: Søren Ehlers.

J. Offshore Mech. Arct. Eng 138(3), 031301 (Apr 01, 2016) (14 pages) Paper No: OMAE-15-1127; doi: 10.1115/1.4032707 History: Received December 18, 2015; Revised January 22, 2016

As oil and gas companies in the Arctic attempt to maximize the value of each project and optimize their portfolio of investment opportunities, it has become vital to evaluate drilling waste handling practices for their cost-effectiveness in order to support strategic decisions. Identifying cost-effective waste handling practices, which have a minimal environmental footprint, however, is one of the biggest challenges for Arctic offshore industries. The cost and potential risks of drilling waste handling practices in the Arctic offshore operation will differ vastly, depending on the operating environment such as the ice conditions and negative sea temperature. However, in the majority of the available cost-effectiveness and risk analysis literature, the influence of the operating environment on the cost and risk profile has received less attention. Hence, the aim of this paper is to propose a methodology for risk-based cost-effectiveness analysis (RB–CEA) of drilling waste handling practices by considering the complex and fast-changing nature of the Arctic. The central thrust of this paper is to highlight the fact that comparing different alternatives based on the cost elements alone is misleading. The proposed methodology uses risk assessment as a key component for the cost-effectiveness analysis (CEA). The application of the proposed methodology is demonstrated by a case study of the drilling waste handling practices of an oil field in the Barents Sea. The case study results demonstrate that the operating environment causes costs to be between 1.18 and 1.52 times greater, depending on the type of practices and operating season, in the Arctic offshore compared with the North Sea. Further, the risk of undesirable events is between 1.48 and 2.60 times greater during waste handling activities under Arctic operational conditions.

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Figures

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Fig. 1

The proposed RB–CEA methodology for the Arctic offshore drilling waste handling practices

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Fig. 2

Generic offshore discharge flowline

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Fig. 3

Johan Castberg oil field Statoil [39]

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Fig. 4

Interexpert variation in 5%, 50%, and 95% estimates of undesirable events in the North Sea offshore drilling waste handling operation

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Fig. 5

Cost elements for skip-and-ship operation in the Arctic

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Fig. 6

A semilogarithmic plot of the total cost of skip-and-ship in North Sea and Arctic versus number of wells. Notice that while the horizontal (No. of drilled wells) axis is linear, with the number of drilled wells evenly spaced, the vertical (total cost of skip-and-ship) axis is logarithmic with the evenly spaced division being labeled with log [cost of skip-and-ship]

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