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![Page 1: Eni Corporate University Scuola Mattei Scuola Enrico Mattei Master Medea year 2003-2004 San Donato Milanese, 28 th June 2004 Alessandro Di Nisio Marco.](https://reader035.fdocuments.net/reader035/viewer/2022062321/56649e855503460f94b87811/html5/thumbnails/1.jpg)
Eni Corporate University Scuola Mattei
Scuola Enrico MatteiMaster Medea year 2003-2004
San Donato Milanese, 28th June 2004
Alessandro Di Nisio
Marco Gazzola
Jeremias Guitarte
Cristian Masini
Marina Muratore
Mariangela PernaTutors:
Domenico Di Renzo
Alberto Marsala
Giorgio Vicini
Expandable Technologies –Economic evaluation of the
installations
Students:
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Eni Corporate University Scuola Mattei
Agenda
• Technological introduction• Reference scenario• Case A – Expandable Technologies: dual zone
application• Case B – Expandable Screen in horizontal well• Case C – Expandable Casing• Conclusions
• Technological introduction• Reference scenario• Case A – Expandable Technologies: dual zone
application• Case B – Expandable Screen in horizontal well• Case C – Expandable Casing
![Page 3: Eni Corporate University Scuola Mattei Scuola Enrico Mattei Master Medea year 2003-2004 San Donato Milanese, 28 th June 2004 Alessandro Di Nisio Marco.](https://reader035.fdocuments.net/reader035/viewer/2022062321/56649e855503460f94b87811/html5/thumbnails/3.jpg)
Eni Corporate University Scuola Mattei
SOLID CASING EXPANSION
• Cased hole remediation system for casing repair, perforation shut-off, corroded casing, …...
• Blank pipes coupled with expandable screens
![Page 4: Eni Corporate University Scuola Mattei Scuola Enrico Mattei Master Medea year 2003-2004 San Donato Milanese, 28 th June 2004 Alessandro Di Nisio Marco.](https://reader035.fdocuments.net/reader035/viewer/2022062321/56649e855503460f94b87811/html5/thumbnails/4.jpg)
Eni Corporate University Scuola Mattei
• Cased hole remediation system for casing repair, perforation shut-off, corroded casing, …...
• Blank pipes coupled with expandable screens
SOLID CASING EXPANSION
![Page 5: Eni Corporate University Scuola Mattei Scuola Enrico Mattei Master Medea year 2003-2004 San Donato Milanese, 28 th June 2004 Alessandro Di Nisio Marco.](https://reader035.fdocuments.net/reader035/viewer/2022062321/56649e855503460f94b87811/html5/thumbnails/5.jpg)
Eni Corporate University Scuola Mattei
• Cased hole remediation system for casing repair, perforation shut-off, corroded casing, …...
• Blank pipes coupled with expandable screens
SOLID CASING EXPANSION
![Page 6: Eni Corporate University Scuola Mattei Scuola Enrico Mattei Master Medea year 2003-2004 San Donato Milanese, 28 th June 2004 Alessandro Di Nisio Marco.](https://reader035.fdocuments.net/reader035/viewer/2022062321/56649e855503460f94b87811/html5/thumbnails/6.jpg)
Eni Corporate University Scuola Mattei
Cou
rtesy
: W
eath
erf
ord
Slotted base pipeCou
rtesy
: B
ake
r
Perforatedbase pipe
Expandable screens provide:
• Effective sand control
• Formation support (eliminate/reduce annulus)
• Larger ID for easier well intervention access
• Enables accurate production logging
EXPANDABLE SCREENS TECHNOLOGY
• Effective sand control
• Formation support (eliminate/reduce annulus)
• Larger ID for easier well intervention access
![Page 7: Eni Corporate University Scuola Mattei Scuola Enrico Mattei Master Medea year 2003-2004 San Donato Milanese, 28 th June 2004 Alessandro Di Nisio Marco.](https://reader035.fdocuments.net/reader035/viewer/2022062321/56649e855503460f94b87811/html5/thumbnails/7.jpg)
Eni Corporate University Scuola Mattei
SCENARIOS’ HYPOTHESIS
Inflation rate 2,5%
WACC 8,1%
Income Tax 36%
Royalties 8%
R&D Investments (K€) 570
Depletion rate 10% 12% 12%(+1%/a)
Gas price ($/MMBTU) 1,5 1,25 1
Oil price ($/bbl) 24 21 18
Exchange rate €/$ 1,05 1,17 1,25
![Page 8: Eni Corporate University Scuola Mattei Scuola Enrico Mattei Master Medea year 2003-2004 San Donato Milanese, 28 th June 2004 Alessandro Di Nisio Marco.](https://reader035.fdocuments.net/reader035/viewer/2022062321/56649e855503460f94b87811/html5/thumbnails/8.jpg)
Eni Corporate University Scuola Mattei
Case A – Expandable Technologies in dual zone application
• Insufficient gravel quantity
• Abandonment of main well and side-tracking
• Expandable Technologies as alternative to Gravel PackCASE A: ADDITIONAL HYPOTHESIS
Production (Sm3/g) 670.000
Productivity increase 20%
Workover cost (K$) 1.250
Probability of shorter longevity(need for a workover on 10th year)
20%
Operating costs ($/boe) 2,2
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Eni Corporate University Scuola Mattei
Case A – Economic Evaluations
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013-200
0
200
400
600
800
1.000
1.200
1.400D
iffe
ren
tial
Cas
h F
low
s (K
€)
Case A - Differential Cash Flows
Best Case Normal case Best CaseWorst Case
Normal case
NPV @ 10 anni 3.800.000 €
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Eni Corporate University Scuola Mattei
• Horizontal well with OHGP• Bad event: swelling shales• Side-tracking with expandable screen
CASE B: ADDITIONAL HYPOTHESIS Production (bbl/g) 6.000
Productivity increase 10%
Workover costs (K$) 1.250
Probability of shorter longevity(need for a workover on 10th year)
20%
Operating costs ($/bbl) 3,5
Case B – Expandable Screen in horizontal well
Intervention costs (K$) 1.700
Probability of swelling shales actually occuring 25% 33% 50%
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Eni Corporate University Scuola Mattei
Case B – Economic Evaluations
2004 2005 2006 2007 2008 2009 2010 2011 2012 20130
500
1.000
1.500
2.000
2.500
3.000D
iffe
ren
tial
Cas
h F
low
s (K
€)
Case B - Differential Cash Flows
Worst Case Normal Case Best Case
Normal case
NPV @ 10 anni 9.500.000 €
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Eni Corporate University Scuola Mattei
Case C – Solid Casing Expansion
• Need for insulating the upper interval (cladding)
• No production increase
• Unique differential Cash flow is cost saving of 850,000$
• Need for insulating the upper interval (cladding)
• No production increase
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Eni Corporate University Scuola Mattei
Adoption of Expandable Technologies at 10 years
Development E.T. total
0
10
20
30
40
50
60
70
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Dev
elo
pm
ent
E.T
. to
tali
Tipe A Tipe B Tipe C Tot ENI
Development E.T. per year
0
1
2
3
4
5
6
7
8
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Dev
elo
pm
ent
E.T
. per
yea
r
Tipe A Tipe B Tipe C Tot ENI
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Eni Corporate University Scuola Mattei
Synthesys within Eni group
2004 2005 2006 2007 2008 2009 2010 2011 2012 20130
10.000
20.000
30.000
40.000
50.000
60.000
Dif
fere
nti
al C
ash
Flo
ws
(K€)
ENI tot - Differential Cash Flows
Worst Case Normal Case Best Case
Normal case
NPV 10 years 163.300.000 €
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Eni Corporate University Scuola Mattei
Synthesys within Eni group
Normal case: NPV 10 years
After taxes 163.300.000 €
No taxes 277.000.000 €
This conclusion might be conservative.
A major E&P company announced a double value creation (320 M€) with almost the same number of installations
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Eni Corporate University Scuola Mattei
Conclusions
Main features of Expandable Technologies:• Increase in production due to larger ID downhole• Cost savings in comparison with alternative solutions• Though, need to confirm technology’s longevity• Anyway, Expandables are already considered a
breakthrough technology• The most ambitious application – in drilling – is the
development of the monodiameter well-bore
• Increase in production due to larger ID downhole• Cost savings in comparison with alternative solutions• Though, need to confirm technology’s longevity• Anyway, Expandables are already considered a
breakthrough technology
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Eni Corporate University Scuola Mattei
Thank you
for your attention