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Production and operations

All three companies that make up the Chad/Cameroon Development Project focused many of their efforts in 2016 on adapting to the changes facing the oil industry. TOTCO and COTCO took significant steps to ensure the pipeline continues to operate reliably, safely and cost effectively. EEPCI concentrated on increasing efficiency while maintaining high operational standards and using enhanced oil recovery techniques to maximize production.

Meeting a major technical challenge: Transporting various types of crude

Expecting increases in the volumes of crude produced in Chad, the pipeline companies tackled the challenge of adapting the system to accommodate the different types of crude that will be transported. Each crude has different characteristics, such as viscosity, wax content and “pour point” – the temperature below which crude oil gels and loses its ability to flow – that affect how the Export Transport System (ETS) must operate to remain reliable and cost competitive.

While all of these factors impact pipeline capacity and modifications, the pour point is the most critical. The ETS was designed to transport crude from the Doba Basin, which has a relatively low pour point. Short- and-long-term solutions are being developed to accommodate crude from PetroChad Mangara/Glencore and the China National Petroleum Company (CNPCIC), both of which have higher pour points.

For TOTCO, COTCO and their shippers the stakes are high. If crude congeals in any section of the pipeline, the flow of oil through the ETS could be disrupted, interrupting oil production and curtailing revenues to the producers and host countries. Additionally, that section of the pipeline would likely need to be replaced at significant cost.

Photo — “We conduct these tests to make sure that the agreements between all the parties continue to reflect the quality of crude that is produced. Ensuring we all know the pour point of the crude also keeps the pipeline safe, since we have to keep the crude running smoothly.” – Su Jinkang, Engineer, CNPCIC.

The pipeline companies have implemented a short-term solution and are evaluating several longer term solutions to this challenge.

  • Blending streams: Comingling crude from the three current shippers has resulted in an acceptable pour point for transportation down the ETS. However, as existing and future companies develop fields that produce more crude with higher pour points, the effectiveness of comingling will be limited by EEPCI’s production of low pour point crude. Current projections estimate this will happen in late 2017 unless other remedial steps are taken.
  • Pour point depressants (PPDs): One potential solution involves mixing polymer chemicals with the oil streams of high pour point shippers to keep the blended crude from hardening at a given temperature. PPDs are widely used throughout the industry to allow refiners, producers and pipeline operators to store, transport and process crudes at lower temperatures. Field tests to identify the most effective PPDs for this situation began in October and are ongoing.
  • Heating: A long-term solution could be to install heaters at several points along the 1070 kilometer ETS to ensure the blended crude temperature remains above its pour point. While this can be the most efficient solution, implementing it depends on volumes being shipped and prevailing economic conditions. TOTCO and COTCO believe that when oil prices and production levels rise to a certain point in the future, the heaters will become a more attractive investment option.

Photo — Salamatou Hissein of subcontractor Baker Hughes conducts a test to determine the pour point of crude while being observed by engineers from the Chadian Ministry of Petroleum and shipper CNPCIC.

Subsea mitigation project protects pipeline integrity

When the ETS underground pipeline reaches the Cameroon coast, the oil travels the final 12 kilometers to the Floating Storage and Offloading (FSO) vessel via a subsea segment of the pipeline. This section of the ETS presents a particular challenge  in terms of maintaining an acceptable temperature of the oil since the seawater in the area fluctuates, sometimes becoming cooler than the pour point of the crude inside. During normal operations the temperature drop in that section of the pipeline is not significant. However, in the case of a planned or unplanned shutdown that causes crude to sit in the pipeline for an extended time, the oil could solidify.

With increasing amounts of higher pour point crude from shippers, it became necessary to protect against this possibility, and in 2016 COTCO initiated the Subsea Mitigation project by installing equipment near the coastline. If flow is stopped for any reason, COTCO can flush the submerged section of pipeline with stored water (above photo) to displace the crude until the ETS is running again, ensuring the pipeline remains protected from solidifying crude regardless of the ocean temperature or length of shutdown. The subsea project effectively removes a key bottleneck to transporting increased volumes of higher pour point crudes produced by new shippers.

An early phase of the system was successfully tested and started up in June 2016, making it possible to transport one million bar- rels of commingled oil that were held back during periods of low sea temperatures in 2015 and mid-2016, while also transporting all other volumes of crude available from the shippers in 2016. Installation of additional equipment that will make the system permanent should be completed in the second quarter of 2017.

Discussing pipeline capacity with Chadian officials and shippers

With three producers contributing different blends of crude oil to the ETS and the possibility of additional shippers in the future, TOTCO met on November 14 with Chadian government officials and the shippers to explain the technical factors impacting pipeline capacity and to discuss possible solutions.

Capacity-limiting factors such as pour point, wax content and viscosity were discussed as well as the company’s commitment to operating within the system’s technical specifications. Adherence to this key principle has enabled the pipeline companies to maintain the ETS’s high reliability rate. Also discussed were solutions for increasing the capacity of the system to accommodate the producers’ volume needs.

Studies show promises of additional production

In 2016, TOTCO met with existing producer CNPCIC and a prospective shipper Taiwanese producer Overseas Petroleum and Investment Corporation (OPIC) to sign agreements authorizing feasibility studies of their proposed development projects, which would increase the volume of crude in the pipeline. The feasibility studies results are expected in 2017.

  • Jean-Pierre Castan

    Export Transportation System Project Manager, TOTCO
    “All the initiatives that we have engaged for adapting the ETS to different qualities of crudes are key steps in unlocking the untapped crude oil potential of Chad.”

Confirming the quality and quantity of shipped crude

As the operator of the ETS in Chad, TOTCO faced pipeline integrity and accounting challenges when two new producers joined EEPCI in shipping their crude in 2013 and 2014. With three different blends of oil now flowing into the pipeline at different rates, TOTCO instituted a sophisticated system for confirming the quantity and quality of each shipper’s oil, both of which can impact pipeline operations and revenues.

To ensure the accuracy of each producer’s flow meters and that their crude meets the technical specifications for acceptance into the pipeline, measurements are recorded every 10 days. During this process, representatives from TOTCO, the shipper and the Chadian government are present to verify that the correct procedure is followed and to certify the results as accurate.

To create the sample for the assessment, a small amount of crude is automatically collected from each shipper’s export flow approximately once per minute over the 10 days and deposited in a sealed container. This container is handled only by the shipper until the assessment sample is drawn from the container at the end of the period in front of witnesses from the three parties. The assessment is conducted over two days:

  • First, a sample of the crude is heated and its water content, API gravity (a measure of a petroleum density relative to that of water), viscosity and sediment are all measured and recorded.
  • After 24 hours the pour point of the sample is checked by heating the sample, observing its behavior as it slowly cools and recording the temperature when it begins to solidify.

In addition to sample testing, the TOTCO team does a series of checks to “prove” the equipment is functioning correctly with each shipper confirming the accuracy of measurements. One of these, called a spot check, confirms the pressure and temperature of each incoming stream, which can then be compared to the shipper’s reading. Once this is complete, the quantities of crude accepted can be compared to quantities of crude produced by the shippers to ensure they match. Each shipper has identical apparatus that all crude entering the pipeline must pass through to measure and analyze.

  • Rouzoumka Madayang Bouba

    Inspector, Ministry of Petroleum, Chad
    “Per the agreement between the shipper, the transportation company and the Chadian government, we are here together to witness the analysis. To ensure consistency and transparency, we all must agree on the results before sending it officially.”

Shipments from marine terminal*
 2016  Project to date
 Millions of barrels  18.9  584
 Export tanker shipments  26  625
 * Consortium only

ETS Reliability
 Minutes of operation in 2016    Minutes of unplanned shutdown
 525,600  versus  45

Successful restructuring of oil field operations

“Safety” and “Efficiency” were the bywords that drove EEPCI’s efforts in 2016 to restructure its operations to meet the challenge of low oil prices. By year-end the company had achieved success on both fronts.

The restructuring program began in early 2015 following EEPCI’s decision to reduce both capital and operational expenses by suspending the drilling of new wells. The company’s focus shifted to maximizing oil recovery from the project’s producing wells.

By the start of 2016, the project had transitioned from operating multiple drilling and completion rigs to one well work rig. The demobilization of equipment was accompanied by a reduction in contractor and employee staffing. These actions resulted in a 95% decrease in EEPCI’s 2016 capital expenses compared to 2014, the last year of substantial drilling.

Described below are several of the operational changes that led to a 20% reduction in operational expenses from 2015 and an all-time best safety record.

Top 200: Recognizing that 30%, or 200, of its 600+ wells produce 75% of its oil output, EEPCI opted to give maintenance and well enhancement procedures priority to this “Top 200.” To the extent time and resources permit, crews also repair and restore lower performing wells outside the Top 200.

28/28: At the end of the first quarter, the Toumaï well work rig was put on a schedule of working 24 hours a day for 28 days and then being “warm stacked” for 28 days; ready for immediate startup. Since starting the 28/28 schedule, the Toumaï rig and its two tightly knit crews have become more efficient than expected, requiring on average 2.3 days per well work procedure vs. the expected 3.5 days.

Work site safety: To minimize risks associated with oilfield operations, EEPCI’s highly trained Safety Specialists make regular work site visits to ensure that all work is performed to company standards. The well work team operating the Toumaï rig is subject to two levels of safety observations and daily reporting: one by the rig contractor’s safety staff, and the other by EEPCI safety personnel, who conduct site visits during the day and at night.

EEPCI senior management’s expectation of an unyielding commitment to safety in all its operations was met in 2016. Over the year, the Operations team had zero Recordable Incidents, its best record since production began in 2003. For more information about the projects safety programs, reference our Health & Safety section.

2016 EEPCI Production Results

  • 582 oil wells online
  • 60 water injection wells online
  • 312 Well renovation and enhancement procedures conducted

Successful pilot shows promise of increasing oil recovery from Doba Basin

A recent pilot project has shown promise in enhancing crude recovery from the project’s asset base and potentially extending the project’s life. Mixing specially designed polymers with the reinjected water can improve the recovery of oil. The process, called polymer waterflooding, increases the viscosity of the water to push oil like a plunger towards the producing wells, thousands of feet below the ground.

Because polymer waterflooding can significantly increase the amount of oil that is recoverable from a reservoir, it is used around the world. However, the process requires certain well conditions to be effective. The project’s reservoirs in the Doba Basin have the right combination of factors, including reservoir pressure and temperature, to make this a promising technique for extending the life and profitability of the project. ExxonMobil is closely following this project to see if there are learnings which can be applied in its fields around the world.

The polymers are neutralized once used, and they pose no environmental impact. After an initial pilot test on one well showed excellent results, the project has expanded the pilot to include nine additional wells with different characteristics. The results of this expanded pilot will provide a more clear picture of how to implement polymer waterflooding cost-effectively at scale. Given market conditions and EEPCI’s commitment to minimizing operating and capital expenditure costs, the approach will likely involve a long- term, phased implementation that strategically targets subsets of the field.

Increasing fuel flexibility to power operations

EEPCI’s program to assure its operations in the Oilfield Development Area (OFDA) have a reliable and cost-effective source of power 24 hours a day took another step forward in 2016 when the second of its four giant turbines at Komé 5 was converted to run on crude oil in the event of a natural gas shortage.

On any typical day, the four turbines generate about 100 megawatts of electricity needed to power hundreds of producing wells and all other project operations in the OFDA. The turbines run on natural gas, but in recent years the natural decline of the project’s gas wells reached the point where additional fuel sources had to be considered to ensure sufficient power production. While diesel was purchased to temporarily bridge any gaps in fuel supply, the project’s long-term solution was to modify the turbines. Conversion of the first turbine, the first in ExxonMobil’s worldwide fleet, was completed in October 2014. Work on the second turbine was finished in February 2016 with a third conversion scheduled for completion in 2018.

  • Fouad Banadji

    Turbine Control System Technician, EEPCI
    “The crude firing conversion was a real team effort which included my fellow technicians and electricians, mechanics, operators, construction workers, welders, pipefitters and colleagues throughout the organization. We feel that this is a big achievement, learned a lot from the first effort that we were able to apply here to minimize downtime.”

Chad Oil Operators' Association update

EEPCI and Chad’s national oil company and consortium partner, La Société des Hydrocarbures du Tchad, founded the Chad Oil Operators’ Association in 2015 to create a forum where industry representatives could discuss potential responses to common problems, such as sharing resources in this low oil price environment. The Association has four working subcommittees:

  • Service Sharing
  • Equipment & Materials Sharing/Transfer
  • Visas & Work Permits
  • Communications & Public Relations

The Association made a formal presentation to the Minister of Petroleum and Energy on September 15, 2016 that included submitting reports prepared by the Equipment & Materials and the Visas & Work Permits subcommittees. In 2017 the Association will be seeking quarterly meetings with the Minister to discuss matters of mutual interest.