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Abstract
The Malampaya Deep Water Gas to Power Project (the
Malampaya project) reached a major milestone when the
Declaration of Commerciality for the project was signed in
May 1998. In just less than 31/2 years, Shell Philippines
Exploration B.V. (SPEX), as Operator, successfully completed
this remote deep water gas project, and successfully
accomplished two additional major milestones by landing gas
for power plant commissioning to its downstream buyers by
October 1st 2001 and commencing commercial sales deliveries
shortly thereafter on January 1st 2002.
This paper describes the history behind this landmark
undertaking, the trade-off between alternative deep water
development solutions, the contracting strategies employed as
well as the many venture management, technical, HSE,
commercial and sustainable development challenges that were
undertaken by SPEX to successfully transform this exciting
deep water project from a vision into a reality.
The Malampaya project marks the dawn of the natural gas
industry in the Philippines, illustrating the crucial importance
of integrating the development of gas markets with the rapid
construction and successful operation of the necessary deep
water and onshore infrastructure. The Malampaya
development comprises five novel subsea wells in 820 metres
of water, producing via a subsea manifold and two 30 km
long, 16 inch flowlines to a concrete gravity platform located
in 43 metres water depth. These wet gas flowlines, with their
large vertical displacements and mixture of gas and liquids
have pushed deep water subsea gas development technology
D. GREER
INTRODUCTION
In 1989, Occidental Philippines, Inc (Oxy) discovered gas in
the Camago-1 well in the area covered by Service Contract
No. 38 (SC-38), offshore Palawan in deep water and 500 km
away from the nearest potential market (Fig.1). The area was
known to be gas prone: Shell itself had been involved in two
earlier gas discoveries elsewhere in the block, which were
then considered uncommercial.
In 1990, Shell Philippines Exploration B.V. (SPEX) farmed-in
taking a 50% interest and operatorship of Block SC-38 thereby
providing the necessary deep water technology, and financial
strength to develop this resource. As part of the farm-in deal,
Shell drilled three wells, the second discovering the large
Malampaya gas field with its 400 to 600 metre gas column and
56 metre oil rim, connected to the Camago structure. The
promising discovery was further appraised by three additional
wells. An integrated petroleum engineering study was carried
out using the latest proprietary 3-D carbonate reservoir
modeling techniques and incorporating the Pre-Stack Depth
Migrated (PSDM) re-processed 3-D seismic data set. By
1995, it had been demonstrated that Malampaya, with proven
recoverable volumes of 2.5 Tscf gas and 85 MMstb
condensate, represented a significant opportunity for a
commercial gas development for Shell and the Philippines.
These volumes were declared commercial on 14th May 1998.
Shell acquired 100% interest in SC-38 following the global
Shell-Oxy asset swap executed on 15th September 1998.
Subsequently on 5th November 1999, Texaco Philippines Inc.
farmed-in, to acquire a 45% working interest in SC-38. PNOC
farmed-in to acquire a 10% working interest on SC-38 on 22nd
December 1999.
HISTORY
The Malampaya field, located some 80 km NW of the Island
of Palawan, is an elongated structure consisting of two
culminations separated by a saddle some 12.5 km long with a
width that varies between 1.5 and 3.5 km (Fig.2). The
reservoir is a high relief Oligocene to Early Miocene
carbonate build-up (Nido Formation) at a depth of some 3,000
metres subsea, developed over tight platform carbonates of
Late Eocene age.
Two exploration wells (Camago-1 and the Malampaya-1) and
three appraisal wells (Malampaya-2, 3, and 4) delineated the
field prior to development, which has a maximum gas column
of some 600 metres and proven reserves of 2.4 Tscf. The
expectation reserves are 3.2 Tscf, with a P15 of 4.1 Tscf. The
gas column is partly underlain by a 56 metres oil rim with a
STOIIP of 244 - 378 MMbbls. Exploitation of the Malampaya
reserves was a recognised deep water challenge and Shells
unrivalled experience in this arena enabled the company to
pursue the commercial development of Malampaya. Initially,
three development concepts were evaluated. For the combined
OTC 14038
OTC 14038
MALAMPAYA DEEP WATER GAS TO POWER PROJECT - AN OVERVIEWPOWERING THE PHILIPPINES INTO THE NEW MILLENNIUM
D. GREER
OTC 14038
OTC 14038
MALAMPAYA DEEP WATER GAS TO POWER PROJECT - AN OVERVIEWPOWERING THE PHILIPPINES INTO THE NEW MILLENNIUM
D. GREER
OTC 14038
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MALAMPAYA DEEP WATER GAS TO POWER PROJECT - AN OVERVIEWPOWERING THE PHILIPPINES INTO THE NEW MILLENNIUM
D. GREER
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MALAMPAYA DEEP WATER GAS TO POWER PROJECT - AN OVERVIEWPOWERING THE PHILIPPINES INTO THE NEW MILLENNIUM
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D. GREER
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MALAMPAYA DEEP WATER GAS TO POWER PROJECT - AN OVERVIEWPOWERING THE PHILIPPINES INTO THE NEW MILLENNIUM
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28 km
504 km
U p strea m
Catenary Anchored
Leg Mooring (CALM)
buoy for tanker
loading of condensate
Gas dehydration
Gas dewpointing
Condensate stabilisation
Export compression
D ow nstream
Sulphur Recovery
H2S removal
Metering
Supply base
Onshore Gas
Plant
-0m
Power
Stations
Alternative
Fuel
- 43 m
3rd flowline
(2021)
Subsea
manifold
Condensate
storage
Condensate
export
- 820 m
5 Development wells
4 Additional developm ent wells (2009)
11
12
D. GREER
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0
100
CGS
Location
South of Mindoro
Batangas
100
200
300
400
500
Manila
Trench
600
700
100
200
300
400
KP position (km)
500