Académique Documents
Professionnel Documents
Culture Documents
March, 2005
Goal
• Identify the Technical, Operational and
Commercial issues required for a successful
Production Handling Agreement (PHA)
between the host platform owners and a third
party producer.
Key Messages
375 ’W. D.
1 .5 MI LE
700’ W. D. -1,000’
TI E - BA CK 720’ W.D.
2. 7 MI LE 720’ W.D.
1997 (a, c) 7.5 MILE 832’ W.D. 860’ - 1,040’ W.D.
TIE - BACK 3.5 MILE 11.5 MILE
TIE - BACK TIE - BACK 9.5 MILE 1,125’ W.D. 1,144’ W.D.
20 00 (a, c) TIE - BACK
1998 (a, c) 200 2 (a, c) TIE - BACK 14. 0 MILE 7.0 MILE
1996 (a) 1995 (a) TIE - BACK TIE - BACK
1999 (a, c) 200? (b, c)
-2,000’
1, 840’ W.D.
3.5 MILE
TIE - BACK
2000 (a)
2,710’ W.D.
Lege nd 28 .4 MILE -3,000’
TIE - BACK
- S ubs ea Comple tion 1999 (a)
3,400' W.D.
30 MILE
- Spa r 2 003 (b, c)
(a) Produ cti on Comm enced 3,850’ W.D. -4,000’
(b) Expected First Product ion 15.5 MILE
(c) Explorat ion Di scov ery TIE - BACK
2001 (b, c) 4,200’ W.D.
op Mari ner Operate d 42 .0 MILE
TIE - BACK
20 04 (b, c)
4,750' W.D. -5,000’
8 MILE
TIE - BACK
2004 (b, c)
5,610’ W.D.
2003 (b, c)
-6000’
-7,000’
7,100’ W. D.
55 MILE
TIE -BACK
2002 (b, c)
Simple Shelf Platform
PLATFORM
541’ WD
SUBSEA
FLOWLINE TREE
JUMPERS GB 73 WELL No. 1
FLOWLINE
TERMINATION 700’WD
SLEDS
Complex Mini-TLP
Finding a Host
• The Search
• Flow Assurance
• Courting a Host
• Timing
• Expression of Interest/Letter of
Intent to Process
• Fees
• Capacity
• General Terms and Conditions
The Next Level - Feasibility
• Process Capacity
• Process Additions and Upgrades
• Fluids Compatibility with Host
• System Operating Pressure
• Risers
• Export System
• Deck Space
• Motion Characteristics of FPF
Operational Issues
• Timing
• Timing of available capacity
• Contracting a host – post or pre-drill
• Construction activity
• Life of Host
• Make-up of the Integrated Project Team
The Team in action.
Subsea
Team
Project
Manager
Subsurface
Team
Commercial Issues –
Construction Phase
• Design – Engineering selection
• Installation – Contractor and vendor selection
• Commissioning
• Production Facility Ownership
• During production
• Post-production
• Abandonment
• Subsea
• Host
Commercial Issues –
Production Handling and Processing
• Production Capacity
• Producers firm capacity rights
• Operators prior commitments
• Priority of production
• Receipt and redelivery points
• Ownership vs. custody
• Quality requirements
• Measurement and allocation
• Commingling
• Limitation or cessation of operations
Commercial Issues –
Production Handling and Processing
• Deferred revenue reimbursement
• Initial installation
• Future construction
• Downtime
• Commitment
• Notice of planned shutdowns
• Proration of costs
• Payment related shut-ins and shut-in conditions
• Production balancing
• Economic limits for host
Commercial Issues -
Platform/Facility Operations
• Standard of performance
• Producer liaison
• Permits
• Payment of employees, consultants
and subcontractors
• Repairs – authority limit
• Emergency
• Risk of loss
• Future access
Commercial Issues –
Compensation and Payments
• Fees
• Processing
• Ratchet down
• Operating fee for routine operations
• Fixed monthly
• Percent of Host platform operating costs
• Minimum fees
• Non-routine operations
• Adjustments to fees
• Common equipment accounting
• Statements and billings
• Audit rights
Commercial Issues –
Termination
• Term of PHA
• Termination rights
• Effect of termination
Commercial Issues –
Force Majeure
• Suspension of obligations
• Notice
• Resolution
• Operator replaces/refurbishes
• Producer replaces/refurbishes
• Producer option to purchase facility from
Operator
Commercial Issues –
Insurance Coverage
• Construction Phase
• Additionally Insured
• Waivers of Subrogation
• Knock for knock
• BAR
• General liability
Allegheny and Lay
Vessel Solitaire
Commercial Issues –
Insurance Coverage
• Post Construction
• General liability
• Protection and indemnity
• Pollution
• Excess liability
• Physical damage
• Premiums and deductibles
• Subcontractor
Commercial Issues -
Indemnification
• Operator/Host
• Producer
• Third party
• Pollution
Commercial Issues –
Miscellaneous
• Description of facility and additions to be made
• Schedule of insurance
• Production allocation methodology
• Measurement standards for production
• Producer production forecast
• Industry/Host standards for construction
• Routine operations
• Construction and Installation Schedule
• Export system requirements
Economic Drivers
• Capacity
• Fees
• Processing
• Operating
• Export system
• Process capital requirements
• Tieback distance
• Capital requirements
• Affect on reserve recovery
• Gravity/quality adjustments
• Timing of initial production
Economic Drivers
Looking for
the right
solution