There is no doubt that North Sea activity, both its highs and lows, has been the benchmark of quality and efficiency for many decades. It is also clear that frontier regions, such as west Africa and South America and the more established Middle East, look north to emulate and take advantage of innovative technologies that have been tried and tested in the United Kingdom and Norwegian continental shelves, and that can be transferred to more challenging or hostile environments.
Aligned with the transfer of technology and skills is the ambition of many regions, such as the Middle East, to develop and enhance its level of in-country competency. The United Arab Emirates (UAE) has traditionally been dominated by the supermajors, but with the entrance of smaller or more independent companies, such as Statoil and Maersk, and competitors from China and South Korea, the “old guard” may have less impact and influence in the future.
Over the past 10 years, a number of regional research centers have been created in the Middle East, including the Qatar Science and Technology Park, the Petroleum Institute in Abu Dhabi, Sultan Qaboos University in Oman, Kuwait Institute for Scientific Research, and King Abdullah University of Science and Technology in Saudi Arabia. All these centers work alongside a number of national and international oil companies as well as international service companies across the region.
One of the main challenges facing the Middle East region is maximizing production. The UAE alone has a sustained production target of 3.5 million BOPD. Achieving this goal will require recovery rates far greater than the global average, so the combined use of indigenous developments and the modification of traditional techniques from the North Sea experience will have a significant role to play.
As in the Middle East, Brazil has been producing oil and gas for several decades, both onshore and offshore. However, deepwater exploration and production (E&P) offshore Brazil is fairly new, especially in ultradeepwater. Unlike the Middle East, where in-country value is an ambition, local content in all new field developments in Brazil is a requirement, whereby international operators must purchase a certain percentage of goods and services from locally established providers.
Despite the obvious restrictions, global operators are getting their foot in the marketplace through the investment in and creation of technology centers. This flood of money into the country’s economy and education system will foster a new generation of motivators and innovators tackling the solutions for deep and ultradeepwater pre-salt carbonate fields on their own doorstep. This shifting landscape has the potential to influence the technology development framework globally.
The philosophy of the centers is based on cementing a closer collaboration between the industry and academia. Schlumberger’s Brazil Research and Geoengineering Center, for example, boasts three fully integrated laboratories for testing and evaluating rocks and fluids in controlled environments and has a staffing capacity of 300. FMC Technologies has invested more than USD 200 million over the past 5 years to ramp up the output of products, such as wet Christmas trees, an ensemble of underwater pipes and valves designed to manage the flow of oil and natural gas from deepwater wells.
West Africa has the third largest deepwater oil and gas market after Brazil and the Gulf of Mexico, with the combined oil production in Africa representing 13% of global production. A large number of the oil majors and suppliers are present and active in west Africa and interest in subsalt exploration is increasing as it becomes more evident that the large unexplored offshore acreages contain significant potential. However, in-country activity is more or less strictly limited to the minimum required to fulfill local content regulations. Successful development of these resources is dependent on access to the experience that operators and international suppliers bring to Africa from subsalt E&P in other regions.
The drive for internationalization and the ambition for in-country content is a challenging balance for emerging regions with specific technology and economic demands. However, lessons continue to be learned from the North Sea for these areas. Like the Gulf of Mexico, the North Sea is facing its own new frontier of technology development as it tackles asset integrity of an aging infrastructure as well as improved and enhanced oil recovery problems.
While the supermajors continue to stamp their mark on new E&P opportunities, the small, nimble, and more responsive businesses from the North Sea and beyond are leading the way in technology development and innovation. This is evident at international oil and gas industry shows and through merger and acquisition activity. It all comes down to the high-quality people and excellent design engineering that has been a hallmark of the industry in the North Sea.
