Rising to the Deepwater Challenges:

Rising to the Deepwater Challenges: Opportunities & Solutions to Develop Green Fields of Eastern Offshore, India

Outline • Overview of east coast • Potential of east coast • Deepwater definition • ONGC’s deepwater portfolio & development opportunities • Case studies • Technological challenges & solutions • Conclusions

Overview of East Coast India Bengal Basin (Category III) Mahanadi Basin (Category II) Krishna Godavari Basin (Category-1) Bay of Bengal Cauvery Basin (Category-1)

Overview of East Coast • India is an emerging deepwater region • 1 million sq km sedimentary basin (Beyond 200m WD) • 54 deepwater blocks offered by GOI (0.52 million Sq Km) • Aggressive exploration activities • 76 exploratory wells drilled • Avg drilling density 0.15 wells/1000 Sq Km • One of the least explored regions in the world • Major discoveries in Krishna-Godavari Basin • Significant unrealized potential

Overview of East Coast NELP Blocks, East Coast India India

Overview of East Coast Krishna Godavari Basin Major strikes KG-DWN-98/3 (RIL) KG-D6 & MA-6 KG-DWN-98/2 (ONGC) DWN-D DWN-E DWN-A DWN-N Annapurna Padmawati Kanakadurga DWN-U DWN-W Ultra Deep-1 KG-OSN-2001/3 (GSPC) Deendayal GSPC Blk Andhra Pradesh -98/3 -98/2

Production Potential PY-3 Field, Cauvery Offshore India • Producing from July 1997 (JV) • Water depth ~50-400m • Nannilam formation • Cretaceous age • 4 wells • API 50 deg

Production Potential Ravva Field, KG Offshore (Shallow) India Hyderabad Ravva • Producing from March 1993 (JV) • Water depth 8-15m • Ravva formation, Miocene age • 21 wells • 8 platforms • PI : 2000-5000 BBl/d/ksc

Production Potential KG-D6 Gas Field (KG-DWN-98/3 Block), KG Deep Offshore • Reliance discovery • Major Gas fields: D1 & D3 • 60 km from shoreline • Water depth 600-1700m • Godavari Clay formation • Plio-Pliestocene age • High productivity reservoir • 5” & 7” production tubing • 18 subsea wells • 60 MMm3/d gas 24”X25Km MEG Line Umbilical distribution hub Control Riser Platform Deepwater PLEM Manifold Flow lines umbilical Subsea distribution Assembly Unit Well

Production Potential MA-D6 Oil Field (KG-DWN-98/3 Block), KG Deep Offshore • Reliance discovery • Water depth 600-1700m • Cretaceous age • Gross thickness : 194m • (GCG 170 m, Oil 24 m) • Good productivity reservoir • 6 subsea wells tied to FPSO • 35K Bpd oil

Deepwater, Variable Definition • Different companies… different definitions… • >300m Deepwater • >1500m Ultra deepwater • Definition changing with time & technology • >500m Deepwater • >2000m Ultra deepwater • ONGC • >250m Deepwater • >2000m Ultra deepwater

ONGC’s Deepwater Portfolio KG-DWN-98/2 Block(NELP) DWN-D (603m) • ONGC 90% PI • Cairn 10% PI • 8 gas discoveries • 3 oil discoveries • Water depths 450-2800m • Marginal fields • Large inter-field distances • Significant oil and gas reserves • Excellent well productivities • Waxy crude ( API 24 deg) • Low GOR DWN-N (606m) India DWN-E (664m) Padmawati (464m) DWN-A (706m) Annapurna (1081m) Kanakadurga(500m) G-2 (451m) DWN-U (1265m) DWN-W (1283m) Oil UD-1(2800m) Gas

ONGC’s Deepwater Portfolio IG Block (PEL) India • PEL block wholly owned by ONGC • Adjacent to 98/2 NELP block • Pliocene gas in G-4 • Cretaceous oil in G-4-6 • Water depths ~ 450m • Marginal size discoveries • Significant reserves • Excellent well productivities G-4 (430m) G-4-6 (450m) 98/2 Block Oil Gas

Development Opportunities • Marginal fields with substantial reserves • Standalone development becomes sub-economical • Cluster development by categorization of fields • Grouping based on water depth, fluid type, pressure, vicinity etc. • Creating common engineering facilities • Hiring the nearby RIL infrastructure PEL Blk 98/3 Block (RIL) 98/2 Block Oil Gas

Development Opportunities Conceptual Development Plan DWN-N Oil Gas Expected gas and oil prod, 40 MMm3/d & 25K bpd respectively

Development Opportunities Ultra-deep field • Water depth 2850m • ONGC discovery • Large free gas field • Large reserves • Good reservoir productivity • Expected gas production ~30 MMm3/d India Conceptual Development Plan KG-DWN-98/2 UD 2X20X75 km UD Fields in similar water depths developed in GoM

Case Studies Deepwater milestones s

Case Studies Brazil BC-10 Block (Campos Basin), Brazil • Water depth 1600-2000m • Shell 50%, Petrobras 35% & ONGC 15% • 3 fields (Ostra, Abalone & Argonauta) tied back to FPSO Espirito Santo • Heavy oil (Api 15-24°), low GOR, thin reservoirs • 9 Subsea oil wells & 1 GI • Subsea oil & gas separation, oil pumped to FPSO thro ESPs • Oil production 60000 bopd • Reserves 400 Million bbls • (64 MMm3) • FPSO capacity : 100,000 BOPD • 50 MMscf/d gas Heavy oil processing Espirito Santo Electrical umblicals Horizontal wells Artificial lift

Case Studies Independence Hub (GOM), Ultra deep Ten gas fields in eastern ultra deepwater GOM developed Water depth 2400-2800m Operator : Anadarko Reserves : ~70 BCM Mississippi Canyon Blk Independence Hub Gulf of Mexico Q (2420m) (2410m) (2550m) (2400m) (2700m) (2550m) (2750m) (2700m) (2740m) (2700m) • Fields tied-back to a deep draft semi-submersible platform (Independence Hub)

Case Studies Independence Hub (GOM) Independence Hub Processing Capacity : 30 MMm3/d gas Condensate : 700 m3/d Water : 500 m3/d Gas production : ~25 MMm3/d No. of wells : 17 Fixed Junction Platform (West Delta 68) Tennessee Independence Trail (24”X 220 km) Processed gas is transported through 24” pipeline (Independence Trail) of 220 Km

Case Studies Perdido Development (GOM), Ultra deep Water depth 2400-2950m JV partners (Shell, Chevron & BP) Operator : Shell (35% PI) Topside processing : 100,000 bopd, 6MMm/d gas & 80K bwpd Oil Production : 80,000 Bpd 22 subsea wells Subsea gas & liquid separation Subsea pumping to SPAR TX Gulf of Mexico Perdido Perdido, Ultra deepwater SPAR Silver Tip (2812m) Tobago (2926m) Frio Great White (2438m) Oil export line 130 km & gas export line 170 km (cut & tie)

Technological Challenges • Reservoir characterization • Dynamic reservoir modeling • Offshore facilities and flow assurance • Uncertainty and risk analysis • Environmental issues, health & Safety

Technological Challenges • Reservoir characterization • G&G model from high quality seismic imaging • Robust fault modeling • Petro-physical characterization • Cores Analysis • Reservoir fluid analysis • Extended well testing Well - A Well - A Sweetness attribute Effective porosity model Well - A Well - A Permeability model Net to Gross

Technological Challenges • Dynamic Reservoir Modeling • Up scaling of static model by MDT • Retention of reservoir heterogeneity • Reservoir fluid & rock physics modeling • Understanding drive mechanism • Achieving higher production with less wells • Placement & Type of wells (vertical, HW, Multi-lateral, intelligent) • Increased oil recovery & enhanced reserve portfolio -

Technological Challenges • Offshore Facilities • Concept selection • Water depth • Field size & Life • Remoteness of field location • Location of infrastructure • Number of wells / drilling centres • Dry Tree or Wet Tree • Drilling or work over capability • Production Capacity • Total Topsides weight • Riser Technologies • Constructability and lead time • Capex & Opex -

Technological Challenges Offshore Facilities… • TLP (148m (Hutton) to 1500m) • FPSO (13m (Armada) up to and beyond 3000m) • Spar (500m up to and beyond 3000m) • Semi-submersible (75m (Argyll) up to and beyond 3000m) • Compliant tower (<600m) TLP - FPSO Spar Semi-submersible Subsea to Shore, Ormen Lange (subsea processing) Compliant Tower

Technological Challenges • Flow Assurance • Prevention and remediation of; • Hydrates • Paraffin • Scales • Asphaltene • Corrosion • Erosion • Production of heavy oil with low GOR • Mechanical treatment; • Pigging • Scrapping • Chemical solvents • Thermal intervention • Sand incursion & control measures Hydrate - Paraffin

Technological Challenges • Uncertainty & Risk • Limited and uncertain data in deepwater • Key uncertainties… • Seismic & Faults • Geological model • Hydrocarbon in-place • Facies variation & Heterogeneity • Reservoir connectivity & extent • Contacts • Porosity & Permeability • Relative permeability • Drive mechanism & Aquifer strength • Recoverable reserves • Concept selection for offshore facilities • Flow assurance, etc -

Technological Challenges • Environment & Safety Issues • Understanding of harsh met-ocean conditions for safe & efficient deepwater development • Adequate conservation & protection of marine ecosystem • Safe disposal practices of drill cuttings, fluids & chemicals (methanol, hydrate inhibitors etc) • Effective emergency response • Compliance to safe operating practices & contingency measures • Avoiding oil spills • Gas hydrates as hazards - Macondo oil leak Macondo Blowout (GoM)

Solutions • Wide angle azimuth seismic acquisition for high resolution imaging and illumination • Robust reservoir characterization • Use of MWD and LWD while drilling (Real time monitoring) for effective geo-steering • Pore pressure management • Advanced reservoir surveillance • Extended well test • Interference test Virtual reality Pore Pr Prediction - Live feed from rig Smart gauges

Solutions • Robust appraisal plan for delineation • Subsea cluster development of marginal fields • Intelligent wells / digital field Controlled WI for good sweep Horizontal completions Multiple completions

Solutions • Robust concept selection, FEED and detailed design of production system leads to increased system reliability • Characterizing multiphase fluid and robust design of subsea flow system to mitigate deepwater flow assurance challenges • The uncertainty of the variables that make significant impact on the economic viability of deepwater can be identified & evaluated with experimental design • JV for deepwater expertise and risk mitigation • Effective contracting methods for timely completion of projects • Special dispensation on gas price and incentives by GOI for development of deepwater resources

Conclusions • India is an emerging deepwater hub • World-class discoveries made in KG Basin • ONGC’s deepwater discoveries in east coast has the potential to significantly contribute to the energy demands of India • Technology is the key enabler to convert resources into economical reserves • Fields in similar water depths are developed elsewhere • Critical areas to be considered in deepwater development; Reservoir characterization, dynamic modeling, flow assurance, uncertainty & risk analysis & environment & safety issues

Thanks for your attention

Rising to the Deepwater Challenges: