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Challenges of operating CSG plants

W ITH over $200 billion of new oil and gas proj ects on the drawing boards in Australia, the recent APPEA (Australian Petroleum Production & Exploration Association) conference attracted significant interest. One of the conference papers was presented by Zeffrey Lucas, president of US operations for international oil and gas service contractor, Production Services Network (PSN).

According to Lucas, compared to conventional gas, coal seam gas (CSG) production introduces additional complexities in operation due to the remoteness, number and distribution of the producing wells, the quantity of associated water and the variability in characteristics of each well. Achieving efficiencies in CSG operations is particu larly important due to the heavy impact on field profitability.

Coal seam gas operations are ramping up in Australia and Lucas tells magazine that, technically and geologically, CSG is similar around the world. “There may be differences with respect to the disposal of water and sources of power but no more variable than regions within the US,” he notes.

That said, there are some differences between CSG and other oil and gas industry projects. Both CSG and tradi tional sources are focused on maximising the recovery of reserves safely and effi ciently. “However, CSG production introduces additional complexities due to the remoteness, number and distribu tion of the producing wells, the quantity of associated water and the variability in well characteristics,” he explains.

At the recent APPEA conference, Lucas presented a project where PSN was engaged to review the operations and maintenance strategy of a CSG asset in the US. The existing organisation and infrastructure had been designed for and was actively operating the field based on a conventional upstream oil and gas approach. This approach led to higher lifting costs, a high percentage of wells unavailable for production, and stranded wells that had been drilled before the infrastructure required for producing the gas had been completed.

There is a tendency in the develop ment of CSG reservoirs to drill ahead of the completion of field infrastructure, due to the relatively low drilling and completion costs. PSN found that an integrated field planning system that ensures well completions are coordinated with ongoing operations and mainte nance is required. This ensures the right work is being done at the right time and allows operations and maintenance to focus on activities which will positively effect production in a planned and cost effective way. This case study demon strated the benefits achieved by PSN’s operations and maintenance manage ment approach of “Value Based Operations”, which effectively utilises proper organisation, prioritisation and planning to optimise production.

Applied to the US asset, Value Based Operations achieved a 20% increase in gas production and a reduction in monthly operating cost of 10%. “CSG operations must take account of the exploration and development of the field,” says Lucas. “Generally the devel opment plan is based on a structured drilling plan to ensure maximum reser voir recovery.”

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