IBP1028_12 A NEW METHODOLOGY FOR QUANTIFYING FLOW ASSURANCE RISKS Alexandre Parker1, Allan Rydahl2

Copyright 2012, Brazilian Petroleum, Gas and Biofuels Institute - IBP

This Technical Paper was prepared for presentation at the Rio Oil & Gas Expo and Conference 2012, held between September, 17-20, 2012, in Rio de Janeiro. This Technical Paper was selected for presentation by the Technical Committee of the event according to the information contained in the final paper submitted by the author(s). The organizers are not supposed to translate or correct the submitted papers. The material as it is presented, does not necessarily represent Brazilian Petroleum, Gas and Biofuels Institute opinion, or that of its Members or Representatives. Authors consent to the publication of this Technical Paper in the Rio Oil & Gas Expo and Conference 2012 Proceedings.

Abstract
Engineering disciplines traditionally focus on providing single solutions based on the best available information at the time a study is undertaken, with a little attempt to quantify the implications of the fact that uncertainties in the input data inherently lead to a range of outcomes, not a single exact answer. It is often critical to understand and quantify the impact of assumptions and uncertainties in input data on final process design and operational aspects. Often the capital expenditure of projects may be lowered or the overall risk associated with a project be reduced when these factors are understood and analyzed properly. This paper describes the application of an approach already adopted in disciplines such as reservoir engineering and which extends the one data set in, one exact solution out engineering approach to a quantifiable, comprehensive uncertainty analysis of the whole engineering solution space being investigated, and also lends itself to the application of optimization tools to then find better solutions. Effectively, this methodology transitions the flow assurance engineering discipline from being deterministic to becoming probabilistic. By utilizing a combination of sensitivity analysis, uncertainty analysis and optimization, it is possible to quantify the impact of input assumptions on key flow assurance decisions. This starts at a high level with the conceptual field layout and may progress into details such as field deliverability, pipeline insulation requirements and equipment sizing. The methodology provides a consistent way of quantifying results from a comprehensive analysis of multiple data input scenarios and will lead to better results for design and engineering projects as well as support better operational decision making. The methodology is illustrated with an example where the approach has been used to optimize gas lift, allowing the elimination of the need to flare excess gas.

1. Introduction
Our approach extends as industry transient pipeline flow model through linking with an uncertainty and optimization package. This optimization computer program has been used for several years in conjunction with reservoir simulators for tasks such as history matching, and has recently been linked to the transient multiphase flow simulator. This coupling has the potential to provide several new and valuable opportunities to improve operations and designs of new facilities. This paper discusses three possible uses of the combined functionality. 1.1. Optimization Software Models MEPO is a software toolkit that provides functionality for experimental design, uncertainty studies, and optimization (Schulze-Riegert et al., 2001 and Schulze-Riegert and Ghedan, 2007). Experimental design allows us to better understand the solution space, preferably at minimum cost in terms of simulation time. The purpose of an uncertainty study is to characterize the range of outcomes that a project might deliver. The purpose of optimization is to maximize or minimize an objective function, which can be virtually any engineering parameter, for example to maximize oil production or Net Present Value (NPV), or minimize required pipeline diameter.

______________________________ 1 Master, Petroleum Engineer - SPT GROUP INC. 2 Ph.D., Petroleum Engineer - SPT GROUP INC.

Rio Oil & Gas Expo and Conference 2012 These three elements are frequently used in combination in a study. For example experimental design can be used to identify the most important input parameters that can affect an outcome. These key parameters can then be selectively addressed in a later optimization phase. The pre-screening performed using experimental design delivers a more tractable problem for the optimizer to handle and therefore faster results. One of the main uses of optimization in the petroleum engineering world has been with reservoir studies. Reservoir studies will typically deliver a range of production profiles, but many reservoir parameters are imprecisely known due to the difficulty of direct measurement, particularly those related to the geology of the reservoir. To gain confidence in the results from reservoir simulation, a reservoir engineer will attempt to match their simulation model to the production history of the field, a process known as history matching. History matching is formulated in the optimizer as a least squares minimization of the difference between the historical production data and the output from the simulator. The optimization (minimization) phase will typically be preceded by one or more experimental design phases to reduce the size of the solution space. Upon obtaining a suite of history matched models, uncertainty studies can then be performed to identify the range of potential outcomes that the models can deliver. The optimizer framework is very adaptable to a variety of different workflows. Other uses to which the technology has put include well location studies, where the optimizer is used to identify the best places to locate wells in order to maximize production; well scheduling studies; plateau optimization; and water alternating gas (WAG) phasing (Schulze-Riegert et al., 2010). 1.2. Transient Pipeline Flow Model OLGA is an industry standard tool for modeling transient and multiphase effects in oil and gas pipelines. Traditional parameter studies are a more deterministic approach where one or few parameters are varied at a time through a predefined simulation setup. This will then define the average operational envelope. Recently MEPO functionality has been implemented in the OLGA pipeline model as the Risk Management and Optimization (RMO) module in order to facilitate uncertainty management of flow assurance projects and optimization of production systems. RMO introduces a more advanced and systematic approach for risk management where the combined uncertainties in all parameters are taken into account at the same time. RMO has an integrated pre- and postprocessor, which offers predefined workflows for sensitivity and uncertainty analysis, tuning and optimization. For each workflow RMO automatically generates input files, launches parallel or sequential simulations and extracts required information for specific results presentations. This is illustrated schematically in Figure 1.

Figure 1: Risk Management and Optimization (RMO) Workflow 2

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2. Applications of Uncertainty and Optimization Workflows to Pipeline Flow Modeling

This paper will discuss two applications of combining an optimizer with a pipeline flow model in the manner described above. 2.1. Uncertainty Analysis Shtokman is a large gas/condensate field in the Russian sector of the Barents Sea. In the design scenario investigated subsea wells flow to a floating production platform, where gas and condensate are dehydrated. The gas and condensate are recombined, and sent to shore through two 36 550 km long pipelines. Onshore, the gas is treated, and sent to LNG facilities. The field development is very costly, due to the large production rates, long pipeline lengths, and harsh operating conditions. As a result, the Shtokman Development Company undertook a detailed study to estimate the uncertainty in the predictions for the multiphase flowlines, to ensure that the design should operate properly. They identified the key flow assurance parameters and the key uncertainty parameters. They also estimated the probability distributions for each of the uncertainty parameters. Their analysis was very thorough. They included not only items in their uncertainty parameters such as fluid composition and physical properties, pipeline diameter, pipe roughness, and sea temperature, but they included items such as the pipeline elevation profile, the pipeline discretization in the modeling, and the accuracy of the multiphase flow code itself. After the parameters and their uncertainties were identified in probability distributions, Monte Carlo simulations were launched by the optimizer package through the transient multiphase flow simulator. The value of each of the key variables for a given simulation was based on the probability distribution. Simulations were run at a given production rate, and values of key variables such as inlet pressure, liquid inventory, etc. were found for each case. The simulation results showed error bands for among others the liquid inventory at a given production rate. Histograms were made showing the probability distribution of the results, allowing the user to determine P10, P50 and P90 values for the variables of interest. This type of analysis provides a much more systematic way of addressing the accuracy and uncertainty of predictions in the design phase of a project. It is likely that this approach will be used for major projects in the future, and that it may be a routine part of the project workflow at some stage (Holm et al, 2011a,b). 2.2. Production Optimization This example is a hypothetical case based on real problems experienced in oil fields on Alaskas North Slope. If gas lift wells have oversized gas lift valves, they can go in severe slugging, with no flow for long periods, followed by high flow for a short period. Annulus pressures up with lift gas, and then quickly depressures when the well begins to flow. The operation is cyclic, happening about every 20 or 30 minutes. The high flowrates cause the production separators go to high level, and cause gas flaring. With an optimizer package linked to a transient multiphase flow model, it is possible to optimize gas lift distribution between wells. Consider four gas lifted wells. Each well has a different reservoir pressure and productivity index. In addition, one of the wells has a gas lift valve that is oversized for the application. In this example, there is a total of 8 mmSCFD of lift gas available to send to the four wells. The production facility which these wells flow to has a limited compression. If the instantaneous oil rate exceeds 11,000 bbl/d, gas has to be sent to flare, incurring a penalty. Traditionally, gas lift optimization is done by using steady state tools. Steady state simulations of each well are made, and graphs of the production rate as a function of the gas lift rate. The optimum distribution of lift gas is a function of the slopes of these production rate/lift gas plots for each well. The steady state analysis was done for the wells in this example. The optimum distribution of gas between the wells was found to give the highest production rate. The results of this analysis were then put into the transient simulator. Due to the oversized gas lift valve, one of the wells is very unstable at the gas lift rate shown from steady state analysis. As a result, the production rate fluctuates wildly as seen in the figure 2.

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Figure 2: Predicted Oil Production Rate using Steady State Optimum Lift Gas Distribution The flowrate fluctuates between 8,000 and 14,200 bbl/d. As indicated previously, when the oil production rate exceeds 11,000 bbl/d, gas would need to be flared. The run indicates that the gas would have to be flared about 16% of the time. The same optimization problem was run with the MEPO optimizer in conjunction with the transient flow model. An objective function was developed to maximize revenue by crediting oil production, but penalizing the results if flaring was required. The distribution of the gas to the four producing wells was calculated with the constraint that the total lift gas was 8 mmSCFD or less. The optimizer ran hundreds of combinations of the flow to each well. Due to the penalties for exceeding the 11,000 bbl/d rate, the program quickly learned to put enough gas in the weakest well to avoid stability problems. Figure 3 shows the production rate for the optimized case.

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Figure 3: Production Rate from the Optimizer/Transient Combination The optimized solution showed no excursions above 11,000 bbl/d. The average production rate for this case was 205 bbl/d higher than the average for the optimum gas lift distribution based on the steady state analysis.

3. Conclusion
The combination of uncertainty and optimization methods with a transient multiphase flow simulator adds considerably to the value of the model, and enables a range of additional questions to be answered by pipeline designers. Two uses for this technology have been described, but it is clear that there are numerous other ways in which this can help engineers both to quantify uncertainty in pipeline models and to find optimal solutions to design problems.

4. References
SCHULZE-RIEGERT, R., AXMANN, O., HAASE, O., RIAN, D.T., YOU, Y-L. Optimization methods for history matching of complex reservoirs, In: SPE Reservoir Simulation Symposium, Houston, USA, February 2001 SCHULZE-RIEGERT, r., GEHDAN, S., Modern techniques for history matching, 9th International Forum on Reservoir Simulation, Abu Dhabi, UAE, 2007 SCHULZE-RIEGERT, R., DONG, MA, HESKESTAD, K.L., KROSCHE, M., MUSTAFA, H., STEKOLSCHIKOV, K., BAGHERI, M., Well path design optimization under geological uncertainty: application to a complex north sea field, In: SPE Russian Oil and Gas Conference and Exhibition, Moscow, Russia, October 2010. HOLM, H., SAHA, P., SULEYMANOV, V., VANVIK, T., HOYER, N. Shtokman flow assurance challenges a systematic approach to analyze uncertainties Part 1. In: 15th International Conference on Multiphase Production Technology, Cannes, France: BHR Group, June, 2011a. HOLM, H., SAHA, P., SULEYMANOV, V., VANVIK, T., HOYER, N. Shtokman flow assurance challenges a systematic approach to analyze uncertainties Part 2. In: 15th International Conference on Multiphase Production Technology, Cannes, France: BHR Group, June, 2011b. 5