Drilling Operations in Oil and Gas Home based Internship

Drilling Operations in Oil and Gas

Home based Internship Report

Of

Department of Petroleum Engineering

Submitted By

Student Name Reg. No.

Mathan I R APE19010

Mohammed Imran APE19011

Mohammed Vasim APE19012

Sankraaj APE19014

Sanjay Krishna APE19016

Umasankar APE19018

Signature of HOD

BONAFIDE CERTIFICATE

This is to certify that the home based Internship entitled “Drilling Operations in

Oil and Gas” submitted by Mr. Umashankar to the department of Petroleum

Engineering, AMET, India for the award of the degree of Bachelor of Engineering

is a bonafide record of the technical work carried out by them under my

supervision. The contents of this internship, in full or in parts, have not been

submitted to any other institute or university for the award of any degree or

diploma.

Signature

(Mentor)

Dr. Ponmani

Asst. Prof.

Dept. of Petroleum Engineering

Signature

(HOD)

Dr. T. Nagalakshmi

Prof.


INTERNSHIP ALLOCATION REPORT 2019-2020

(In view of advisory from the AICTE, Internship for the year 2019-2020 are offered by the

department of Petroleum Engineering to facilitate the students to take up required work from

their home itself during the lockdown period due to COVID-19 outbreak)

Name of the Programme : B.E Petroleum Engineering

Year of study and batch/Group : I & 12 /G1

Name of the Mentor : Dr. Ponmani

Title of the assigned internship :


Nature of Internship : Home Based Group: 1

Reg. No. of the students who are assigned with this Internship:

APE19010

APE19011

APE19012

APE19014

APE19016

APE19018

Total No. of Hours required to complete the internship: 60

Signature of

Mentors

Signature of Internal Examiner

Signature of HOD/Programme

Head




Name of the students Mathan, Mohammad Imram, Mohammad Vasim,

Sankraaj, Sanjay Krishna, Umashankar

Reg. No. APE19010, APE19011, APE19012, APE19014, APE19016,

APE19018

Programme of study B.E. Petroleum Engineering

Year & Batch/Group I & 12/G1

Semester II

Title of Internship Drilling Operations in Oil and Gas

Duration of Internship 60 Hours

Name of the Mentors Dr. Ponmani

Evaluation by the department

SI

No.

Criteria Max. Marks Marks Allotted

1 Regularity in maintenance of the diary 10 8

2 Adequacy & Quality of information

recorded

10 8

3 Drawing, Sketches and data recorded 10 7

4 Thought process and recording

techniques used

10 8

5 Organization of the information 10 8

6 Originality of the internship report 10 8

7 Adequacy and purposeful write-up of

the internship report

10 8

8 Organization, format, drawing,

sketches, style, language etc. of the

internship report

10 9

9 Practical application, relationship with

basic theory and concepts

10 8

10 Presentation skills 10 9

Total 100 81

Signature of the

mentor

Signature of the Internal Examiner

Signature of the HOD

S. NO Table of Contents Page No

1 Abstract 1

2 Introduction 2

3 Literature survey 4

4 Planning of drilling well 5

5 Choice of drilling rig, wellhead and

BOP

7

6 Control of drilling operations 8

7 Drilling cost 9

8 Well abandonment 9

9 Summary and Conclusion 10

1

ABSTRACT

Due to constructive role of technology developments in petroleum industry and their affects in reducing the

costs of drilling, it is necessary to use future technologies. One of these new progresses taking very effective

role in drilling industry is to get use of laser in drilling processes.

The aim of this paper is to categorize and represent the different study results and also to analysis the

principle and advantages of laser drilling. Compared to prevalent drilling, laser drilling is capable to

augment the efficiency of drilling and solve its problems such as increasing the rate of penetration,

monitoring the bottom hole, diminishing equipment and drilling process, but faces some problems such as

laser beam transference, cleaning the down hole. As a result, the benefits of laser drilling overcome the

problems and it can be replaced or combined in bits in early future. In this paper we showed the result of

using laser technology during drilling operation. Also, in this paper we experimented on changing

wavelength transmitted during fracturing and drilling.

2

INTRODUCTION

The term drilling indicates the whole complex of operations necessary to construct wells of

circular section applying excavation techniques.

To drill a well it is necessary to carry out simultaneously the following actions (drilling process):

• to overcome the resistance of the rock, crushing it into small particles measuring just a

few mm;

• to remove the rock particles, while still acting on fresh material;

• to maintain the stability of the walls of the hole;

• to prevent the fluids contained in the drilled formations from entering the well.

This can be achieved by using rotary drilling rigs which are the ones operating today in the field

of hydrocarbons exploration and production.

The drilling rigs are complexes of mobile equipment which can be moved (onshore and offshore)

from one drill site to another, drilling a series of wells.

In rotary drilling the rock is bored using a cutting tool called the bit, which is rotated and

simultaneously forced against the rock at the bottom of the hole by a drill string consisting of

hollow steel pipes of circular section screwed together.

3

Figure 1: Drilling Rig Figure 2: Component of Drilling rigs

The cuttings produced by the bit are transported up to the surface by a drilling fluid, usually a

liquid (mud or water), or else a gas or foam, circulated in the pipes down to the bit and thence to

the surface.

The rotation is transmitted to the bit from the surface by a device called the rotary table or, in the

modern rigs, by a top drive motor with the rotary table as backup; additional rotation can be

added by downhole motors located directly above the bit.

4

LITERATURE SURVEY

Nd:YAG is a crystal that is used as a lasing medium for solid-state lasers. Its operating

wavelength is 1.06 and has power possibility more than 10kW. The advantages of using

pulsed Nd:YAG laser on rock drilling are fiber optic cable deliverable over long distances,

dynamic pulsed thermal loading generation on the rock, laser beam collimation at a specific size

which may help reducing hole tapering. Laser/rock interaction test data show that Berea Grey

sandstone permeability in and around the lased area is enhanced due to clay dehydration and

micro fractures induced by the high temperatures generated in the rock while lasing [3]. Nitrogen

gas purging can be attached to the laser head and positioned near to the laser beam to clean the

bottom hole and help removing, melting rock and improving the rock removal [13]. Long laser

bursts dump more energy to the rock than that need for the local surface spallation, increase heat

input to the work piece. This excessive heat input during drilling produces a large heat-affected

zone, recast layer, and even micro-cracking and cause to melt the rock. These occurrences are

depicted schematically in figure1. In contrast, newer diode-pumped solid-state lasers, as shown

in figure2 [4], provide pulses with very short durations, in the Nano, Pico, or even femto-second

range. These short duration pulses deliver higher peak power intensity, easily penetrating the

plume, reducing the heat-affected zone, and virtually eliminating the recast layer and micro-

cracking. The process parameters that contribute to the efficiency of rock elimination by a pulsed

laser are: laser energy per millisecond, pulse width, pulse repetition rate, beam spot size, beam

relaxation time, purging gas configuration and gas flow rate. Selection of parameters must be in

a way that augments the rate of penetration (ROP). [3]

5

PLANNING OF DRILLING WELL

The planning of a well is a fundamental part of the drilling process – it is the basis for making all

the important technical choices, for assessing the costs and organizing the actual construction of

the well in the most efficient way. The well planning starts the moment when the interpretation

of the seismic data and the reconstruction of the geology of the area reveal the presence of a

structure favorable to the accumulation of hydrocarbons.

These data also enable an estimate to be made of:

• depth of the productive levels; stratigraphic and lithological sequences; problems that

could emerge in an operational phase.

Geologists prepare a document containing estimates and proposals for drilling the well on the

basis of the information in their possession obtained from:

• geological surface campaigns; regional geological studies; studies conducted on seismic

maps; profiles of wells already completed in the area.

This document is the introduction to the drawing up of the proper drilling program to give the

data necessary for:

well location, drilling objectives, foreseen of the final depth, forecasts of the litho-stratigraphic

profile, possible drilling problems that could be encountered, etc.

The analysis and processing of all this large mass of information provides the drilling engineers

6

with the essential elements for drawing up the drilling program.

These data are available from existing documents such as:

• Geological profiles; Well Logs; Pressure reports; Drilling reports; Drilling fluid reports;

Cementing reports; etc

Every well has its own specific features (depth, exploratory, development or appraisal well,

onshore or offshore, vertical, directional or horizontal..) but the basic criteria are the same for

all well types.

7

The first step to be taken by engineers to work out the drilling programme is to construct, the

trend of the pressure gradient curves according to depth (geostatic, pore pressure and fracture

gradients) to design the well casing profile.

CHOICE OF RIG, WELLHEAD AND BOP

The casing levels, the diameters and weight of the strings, the pressures and temperatures

concerned, and the volumes of drilling mud to be used, are all aspects participating in

determining the choice of rig type, blowout prevention systems (BOP, choke manifold, hydraulic

circuit) and wellheads.

The choice of rig is closely bound up with the depth it is wished to reach and with the weight of

the strings concerned.

According to the weights of the strings to be handled, rigs are used that have different

characteristics, and what is of basic importance is the strength of the whole assembly, (travelling

block, crown block, hook and derrick floor) from which the string hangs while being lowered

into the well.

In offshore activity, the choice of the rig is determined, not only by the weight of the strings, but

also by the depth of the water in the area of operations.

Drilling rigs installed on offshore vessels or platforms are built to reach the maximum possible

depths and have all the material and equipment necessary for drilling on board.

The composition of the wellhead depends on the pressures that can be reached during the various

working phases – both drilling and production – and on the diameters of the strings to be lowered

8

into the well.

CONTROL OF DRILLING OPERATIONS

The great complexity of the drilling process, its high costs, the need to ensure the full efficiency

of the rig and the respecting of safety and of the environment call for a continuous optimizing of

operations, which are achieved through the monitoring and processing of all available data, both

geological and drilling.

To reach these objectives, every drilling rig, and in particular those that have to drill complex,

deep and therefore costly wells, is endowed with more or less sophisticated mud logging units,

which permit – through appropriate sensors and the activity of specialized personnel – the

acquisition, processing and interpretation of a vast range of information of interest both to the

geologist and to the drilling engineer.

Mud logging units are equipped with sensors, positioned in appropriate parts of the rig,

permitting the automatic, continuous acquisition of the most significant parameters, and

advanced information systems, based also on expert systems, as the means of managing

operations in real time, with the consequent reduction of time and costs.

These sensors transmit their signals to a computerized system housed in the mud logging cabin,

which provides for their representation also in graphic form, their storage in special local data

9

banks, and the sending by means of radio links, dedicated telephone lines and communications

via satellite, of selected data to operational centres.

DRILLING COSTS

The drilling programme indicates also the budget that it is necessary to allocate to reach the

targets, and which has to be adhered to during the construction of the well.

The costs of drilling a well can vary, depending on the particular type of well planned and the

environment.

The budget contained in the drilling programme indicates the amount of the economic resources

available in the estimate, which has to be adhered to as far as possible; but it is obvious that the

real amount depends on the problems that crop up during drilling and on the capacity of the

engineers to address them promptly without compromising the achieving of the objectives.

WELL ABANDONMENT

If, when drilling has been completed, the well is productive hydrocarbons, a start is made on all

those operations that will ensure its economically advantageous working, whereas if, on the

contrary, it should prove to be barren or in any case not economically exploitable, it will be shut

down.

Well shutdown entails the restoring of the initial conditions of the section of the well not lined

and possibly also the lined part, if separation of the permeable levels of different pressure is not

assured.

10

The purpose of these measures is to prevent the transfer of fluids from one level to the other.

The final shutdown of a well must satisfy not only the requirements set out in the engineering

best practices fixed by the operator, but must also respond to all the requisites of law aimed at

safeguarding the environment and the safety of the people living in the vicinity of abandoned

wells.

SUMMARY AND CONCLUSION

The operations of Petroleum Drilling have attracted much importance since few decades. We

have discussed about various drilling operation and their functions in this project. The operation

procedure is found to be much important so that safe and efficient drilling activity is carried out.

A STUDY OF FACTORS INFLUENCING OIL PRICES


Of


Submitted By


Induja APE19007

Signature of HOD


This is to certify that the home based Internship entitled “Study of Influencing

Oil Prices” submitted by Ms. Induja to the department of Petroleum





diploma.

Signature

(Mentor)

Dr. Prince

Asst. Prof.


Signature

(HOD)

Dr. T. Nagalakshmi

Professor


APE19007



department of Petroleum Engineering to facilitate the students to take up required work

from their home itself during the lockdown period due to COVID-19 outbreak)



Name of the Mentor : Dr. Prince





Signature of

Mentors



Head

A STUDY OF FACTORS INFLUENCING OIL PRICE


department of Petroleum Engineering to facilitate the students to take up required work

from their home itself during the lockdown period due to COVID-19 outbreak)

Name of the students Induja

Reg. No. APE19007



Semester II

Title of Internship A STUDY OF FACTORS INFLUENCING OIL PRICES


Name of the Mentors Dr. Prince


SI

No.




recorded

10 8



techniques used

10 8





10 8



internship report

10 8



10 8


Total 100 80

Signature of the

mentor

Signature of the Internal

Examiner



1 Abstract 1

2 Introduction 2


4 Crude oil characteristics 6

5 Case study 10

6 Effect of oil price exchange rate 14

7 Conclusion 18

1

ABSTRACT

The internship is based on the study undertaken to identify gaps in current knowledge pertaining to price formation, volatility and the role of hedging and speculation in the global oil market. our survey uncovers considerable evidence based on several research studies to suggest that fundamental factors, namely stagnant supply, unexpected economic growth from China and other countries such as India ,low interest rate, and a weak U.S. dollars, were at least associated with and may have contributed to the sharp oil price run-up and subsequent decline in the 2007- 2008 period. There is also some evidence to suggest that the price run-up an decline may have been exacerbated by the formation and collapse of an oil price bubble, perhaps triggered by fundamental factors in both the oil market and the broader global economy. Despite considerable evidence pointing to a major increase in oil derivatives trading and significant change in the composition of derivatives traders over the past decade ,the contribution, if any, of those traders and of speculation in oil derivatives to the 2007-2008 oil market turbulence remains undetermined for two reasons. First the existing body of research does not provide a definitive answer to the question of how oil inventories respond to the future spot price spread which should be the mechanism connecting financial market speculation and physical oil price if the latter are determined by supply and demand.

2

INTRODUCTION

The purpose of this thesis is to analyse factors affecting change in the crude oil price over the period from 1994 to2020. we apply a time-varying model to analyse how significant factors vary over time ; that is how the different underlying explanatory factors relationship with oil prices behave stochastically.

Crude oil prices have been the source of discussion over the past decades. The cyclical nature of the market in times of under- and overinvestment has made it challenging for countries, industrial companies and investors to deal with the risks involved. It is believed that high oil prices can slow economic growth, cause inflationary pressures and create global imbalances. Volatile prices can also increase insecurity and discourage essential investments in the oil sector. Recent high oil prices and tight market condition have also raised fears about oil scarcity and concerns about energy security in many oil-importing countries.

3

As in depth analysis of the underlying factors can b useful to anyone dependent on or interested in investing in the crude oil market. The empirical evidence may help to improve understanding of the behavior of the underlying factors and the market dynamics .Analysis of time -varying coefficients will not only identify which factors are significant over the time period studied, but also which factors that have relatively fixed behavior and those that behave differently through period of an economic cycle.

4

CRUDE OIL CHARACTERISTICS

Crude oil prices should priced much like any other exhaustible commodity (hostelling, 1931) yet there is a common believe that oil and energy prices behave differently and are more volatile than other commodities (felming & ostdick, 1999). Some observers structural transfomation that have changed the influence of underlying factors and placed the oil price on a new path.One special point concerning price formation in the curde oil market is the organization of the petroleum exporting countries(OPEC), which operates as a cartel with the largest producion capacity. Crude oil price cycles are common and may extend over several years responding to changes in demand as well as OPEC and non- OPEC supply. The underlying factors influence on price movement will vary during the cycle depending on the position in the cycle, pace and future expectation.As an example, the pricing power of OPEC is not straightforward. The pricing power varies over time and is induced by market conditions and can be seen in both weak and tight market (Fattouh, 2007a).

Understanding the factors behind crude oil price

changes

A point made by Fattouh(2007a) is with the growing importance of the futures market in the process of price discovery;it has become more difficult for producers ans especially OPEC to follow set output policies.This point

5

might be especially important as the last years have seen a strong growth in the commodity derivatives markets. The total value of the investment in commodity indexes has increased from about 15 billion US Dollors by mid -2008 (US Senate,2009). During this period,financial institutions have heavily marketed commodity indexes as a way to diversify portfolios, and profit from rising commodity prices.About 70 percent of the commodity index investments are in near-term energy contracts ,following a strategy of continuously rolling futures contracts to maintain the investments ( Hamilton,2008).

RELATED STUDIES ON THE CRUDE OIL MARKET

Three main approaches have been used for analysing oil prices. First ,non-structural modes rely on the theory of exhaustible resources as the basis for understanding the oil market. Second a structural supply/demand framework uses behavioral equations and factors that link oil demand and supply to its various determinants .Finally, an informal approach can be studied by analyzing oil price movements within specific contexts and episodes of oil market (Fattouh,2007) .In this thesis we will utilize a structural framework when analyzing underlying factors behind oil price changes, and we will also seek to identify structural changes through

6

a time-varying framework.We go through the literature of structural studies on price determinants in an econometric framework.

Kaufmann et al. (2008) expands their previous models for crude oil prices to include refinery utilization rates. OPEC capacity utilization and contango level as explanatory variables to explain the rapid rise in crude price between 2004 and 2006.They conclude that most of the increase can be explained by concerns about future oil markets conditions, represented by the future market moving from backwardation to contango.In our time- varying model we will investigate the significance of three future market variables to study this future.

Hamilton (2008) examines factors responsible for recent changes in crude oil prices, and especially what produced the high price in 2008. The factors are not implemented in a model but discussed to get a broader understanding.Factors include commodity price speculation ,strong world demand,time delays or geological limitations on increasing production, OPEC monopoly pricing ,and an increasingly important contribution of the scarity rent.One conclusion is that explaining recent prices movements ,such as the soaring prices in 2008; one possibilty is that there is an element explanation to a broader set.

7

FOCUS AND FACTORS

The identification and study the significant underlying factors in a state-space framework. The thesis examines the dynamics, structural breaks and the fluctations of the underlying factors in the crude oil market . It was been extend the research of Morbert ,Tham and Hamilton by examining demand,supply,OPEC's influence, financial factors and price speculation simultaneously for their impact on crude oil price changes in a state model during the time period from 1995 to2009.[2]

8

LITERATURE SURVEY

we present a summary of the literature in the broad area of demand in the world oil markets. The literature explains the estimates of price elasticity of demand in the world oil markets,estimates of the relationship between energy and oil consumption , the emperical estimates of the elasticity of aggregate output with respect to crude oil and energy price ,the transportation sector ,estimates of the changing nature of seasonal factors.The short run price elasticity is quite small,most likely close to -0.5. Inspite of the efforts to deal with the asymmetry problem,there does not appear to be any change in estimates of this short run elasticity when asymmetry is accounted for.There is no consensus on the size of the long run prices elastially.This is partly due to the lack of definition of what the long run actually is. In any event,this is most likely a moot point ,as any long run elastically will probably change overtime.This is more than a question of asymmetry of response, but rather a question of how economic changes over time in their response to price movements.It is possible that all economies exhibit some efficiency gains over time , and that these gains are a function of the level and , movement of price.The price elasticity literature appears to have evolved into a complicated economic literature on the reaction of GDP to price shocks.

9

THE RELATIONSHIP BETWEEN ENERGY ANDENERGY CONSUMPTION AND INCOME

The goal of this literature appears to be to estimate the income elasticity of demand, and test whether this estimate is statically below unity. However, if there is a stable ,deterministic UEDT, this must be part of the specification ,or the estimated elasticity will be based. The former involves including a liner time trend in any regression, while the latter may lead to the question of unit roots. Gamely and Huntington(2003) used the graphical approach in an introductory section of their paper .They reported that OECD countries fall on 45 degree line with some expectation -Ireland, Norway Japan,Great Braitain, Denmark and USA .These would appear to be lower energy growth countries .The Gately and Huntington results are consistent with the Hannesson results in that there is a great deal of heterogeneity across countries .Clearly diffferent countries have different characteristics ,and should not be grouped together in later analysis. Futher ,oil demand tends to grow at the same rate as GDP

in countries that start on a lowbase-for instance Portugal, Greece,

Mexico, Turkey and Spain.

10

Figure 1: ENERGY RATES FROM 2000-2010

Figure 2: PRICES CHANGES FROM 1996-2010

11

THE EMPERICAL ESTIMATES OF AGGREGATE OUTPUT WITH RESPECT TO CRUDE OIL PRICES

This an evolving literature, with very recent

contirbutions. M.A Hooker and J.D.Hamilton have advanced

the belief that there is a statically stable specification

between oil prices and GDP .The major contribution are

Hooker(1996,2001 and 2003).Hamilton (2003) uses a

flexible approach to estimating the non-linear relationship

between oil prices and economic activity . Hamilton finds

"clear evidences" of non-linearity in this

relationship.Hamilton also finds that oil price increases are

much more important than oil price decreases, which

confirms some of the earlier

findings in the literature.

Other contributions to asymmetry came from

MORY(1993) and Mork,Olsen,and Mysen (1994).The latter

paper investigated the correlation between oil-price

movements and GDP fluctations for seven OECD countries.

They considered the bivariate correlation as well a partial

correlations within a reduced -form macroeconomic

model.The bivariate result show a general pattern of

negative correlation between GDP growth an real oil prices

increases . This correlation is significant on the 10% level for

all countriess except Canda .Furthermore, Norway shows

a significant positive

12

Correlation given the large relative magnitude of the oil

sector in the Norwegian economy.

Figure 3: CHANGE IN OIL PRICE IN NORWAY

TRANSPORTATION SECTOR

One extremely important consideration mentioned by

Graham and Gleister is the question of energy efficiency

and how it should be modeled in the transportation

sector.If energy efficiency is accounted for at all,it is usually

modeled as exogenous and deterministic. This problem is

the focus of an important paper by Hunt and Ninomiya

(2203b).In this paper,the author attempt to estimate

the income and price elasticities of oil

13

demand for the transport sectors of the UK and

Japan,taking account of what they call the Underlyin Energy

Demand Trend (UEDT).Hunt and Ninomiya argue that it

would be extremely unlikely that the UEDT could be

adequately modelled b a simpler linear time trend, which

has been the conventional approach.Therefore ,they

estimate a stochastic underlying trend for the transport

sectors of the UK and Japan.They uncover a genearally

upward sloping UEDT for the UK suggesting that,ceteris

paribus the demand curve for transportation oil in the UK

has been shifting to the right over the estimation period,it

was estimated UEDT and the movement of real

tranportation oil prices over the period .

SEASONAL INFLUENCES ON ENERGY AND OIL DEMAND

In two important papers, Jazayeri and Yahyai (2003a and

2003b) show that the nature of the seasonal pattern is

changing in specific manners.Jazayeri and Yahyai show that

oil consumption ,especially amongst OECD countries,follow

a seasonal pattern that reflects changes in

temperature.Since 1985 autumns and winters have

gradually turned warmer,leading to lower oil consumption

for heating .However,summers have

14

become warmer,increasing oil cosumption for cooling.This

latter warming has also caused an increase in the demand

for transportation .

CASE STUDY

We examine the asymmetric effcts of daily oil price changes

on equity returns,market betas,return variances and

trading volumes for the US oil and gas industry.The

responses of stock returns associated with negative

changes in oil prices are higher than that associated with

positive changes in oil prices.Stock risk measured by market

beta is influenced more due to oil price decrease than due

to oil price increase.On the other hand ,oil risk

exposuress(oil beta) and return price betas.return variances

respond asymmetrically to oil price changes.We also find

that relative changes in oil prices along with firm-specific

factors such as firm size,ROA,leverage, market-to-book

ratio(MBR) are important in determining the effects of oil

price changes on oil and gas firms ,returns,risks,and trading

volumes.[4]

15

CRUDE OIL PRICE : A COMPARITIVE STUDY OF CHINA AND INDIA

While several studies have examined the linear causal relationship between oil prices and exchange rates, little is known about the non linear causality beetwen these two variable. The present paper tries to fill this research gap in the context of India and China. By applying the Hiemsra and Jones (1994) non linear Granger causality test to the VAR residuals,the study find a significant bi- directional non linear Granger causality between oil prices and exchanges rates in both countries.The findings suggest that the nonlinearity of oil price influences the exchange rate irrespective of the exchange rate regimes.Further ,to check robustness,the persistence in the variance of oil prices and exchange rate is taken into account using GARCH (1,1) model. While the results consistently hold in the case of India,with respect to China,a unidirectional causality runs from exchange rate oil price.However, the oil price in China does not Granger cause exchange rate.

16

ANALYZING OIL PRODUCTION IN DEVELOPING COUNTRIES

This presents a detailed simulation analysis of the domestic oil sector in Egypt; a near -typical,non-OPEC, oil producing developing country.Egypt is a small producer by international standards ,yet significant enough that its oil production is important for the country's economy and under certain condition ,for the international oil markets as well.A dynamic computer simulation model that depicts significant characteristics of the country's oil sectors is utilized to explore the implications of alternative scenarious for government policies,world oil prices,and geological parameters on pattern of production ,exports and export earnings.

17

THE EFFECT OF OIL PRICES ON EXCHANGE RATES: STUDY OF THE DOMINICAN REPUBLIC

Oil imports represent a significant fraction of the trade balance for energy-dependant economies. In the case of small open economies with floating exchange rates, the variability in oil prices is expected to have a large impact on thr relative value of the currency. This relationship between the price of oil and the exchange rate has been established by te literature of oil -producing countries but not fot oil-importing countries. In the case of Dominican republic ,an energy dependants small open economy with a float exchange rate, to illustrate this connection and oil imports in 2003 represented 27% of totalimports, which is up from 10% in1994.Thus,the international price of oil is of great relevance to the Dominican economy. Because oil contracts, both in spot values and in future contracts, are communicated in US Dollars, Dominican imports must sell their pesos in the foreign exchange market in order to obtain liquidity in of oil would put depreciating pressure on the Dominican Peso, whereas a decrease in the world price of oil would allow for an appreciation of the Dominion currency

18

CONCLUSION

The proposed methodology is able to identify shifts in factors

driving oil price before and after 2008 financial crisis with high

explanatory power. The role of reserves before the crisis seems

to be enormous but weakens after the crisis. The importance

of reserves before the crisis was repercussion of cuts in OPEC

production targets, or changes in OPEC policies. But after the

crisis, increases in Non-OPEC production indirectly weakness

the effect of reserves on oil prices.



Of


Submitted By


Mathan I R APE19010

Signature of HOD


This is to certify that the home based Internship entitled “Drilling Operations in

Oil and Gas” submitted by Mr. Mathan I R to the department of Petroleum





diploma.

Signature

(Mentor)

Dr. Ponmani

Asst. Prof.


Signature

(HOD)

Dr. T. Nagalakshmi

Prof.








Name of the Mentor : Dr. Ponmani





APE19010

APE19011

APE19012

APE19014

APE19016

APE19018


Signature of

Mentors



Head




Name of the students Mathan, Mohammad Imram, Mohammad Vasim,

Sankraaj, Sanjay Krishna, Umashankar

Reg. No. APE19010, APE19011, APE19012, APE19014, APE19016,

APE19018



Semester II

Title of Internship Drilling Operations in Oil and Gas


Name of the Mentors Dr. Ponmani


SI

No.




recorded

10 8



techniques used

10 8





10 8



internship report

10 9



10 8


Total 100 81

Signature of the

mentor

Signature of the Internal Examiner



1 Abstract 1

2 Introduction 2


4 Planning of drilling well 5

5 Choice of drilling rig, wellhead and

BOP

7

6 Control of drilling operations 8

7 Drilling cost 9

8 Well abandonment 9

9 Summary and Conclusion 10

1

ABSTRACT

Due to constructive role of technology developments in petroleum industry and their affects in reducing the

costs of drilling, it is necessary to use future technologies. One of these new progresses taking very effective

role in drilling industry is to get use of laser in drilling processes.

The aim of this paper is to categorize and represent the different study results and also to analysis the

principle and advantages of laser drilling. Compared to prevalent drilling, laser drilling is capable to

augment the efficiency of drilling and solve its problems such as increasing the rate of penetration,

monitoring the bottom hole, diminishing equipment and drilling process, but faces some problems such as

laser beam transference, cleaning the down hole. As a result, the benefits of laser drilling overcome the

problems and it can be replaced or combined in bits in early future. In this paper we showed the result of

using laser technology during drilling operation. Also, in this paper we experimented on changing

wavelength transmitted during fracturing and drilling.

2

INTRODUCTION

The term drilling indicates the whole complex of operations necessary to construct wells of

circular section applying excavation techniques.

To drill a well it is necessary to carry out simultaneously the following actions (drilling process):

• to overcome the resistance of the rock, crushing it into small particles measuring just a

few mm;

• to remove the rock particles, while still acting on fresh material;

• to maintain the stability of the walls of the hole;

• to prevent the fluids contained in the drilled formations from entering the well.

This can be achieved by using rotary drilling rigs which are the ones operating today in the field

of hydrocarbons exploration and production.

The drilling rigs are complexes of mobile equipment which can be moved (onshore and offshore)

from one drill site to another, drilling a series of wells.

In rotary drilling the rock is bored using a cutting tool called the bit, which is rotated and

simultaneously forced against the rock at the bottom of the hole by a drill string consisting of

hollow steel pipes of circular section screwed together.

3

Figure 1: Drilling Rig Figure 2: Component of Drilling rigs

The cuttings produced by the bit are transported up to the surface by a drilling fluid, usually a

liquid (mud or water), or else a gas or foam, circulated in the pipes down to the bit and thence to

the surface.

The rotation is transmitted to the bit from the surface by a device called the rotary table or, in the

modern rigs, by a top drive motor with the rotary table as backup; additional rotation can be

added by downhole motors located directly above the bit.

4

LITERATURE SURVEY

Nd:YAG is a crystal that is used as a lasing medium for solid-state lasers. Its operating

wavelength is 1.06 and has power possibility more than 10kW. The advantages of using

pulsed Nd:YAG laser on rock drilling are fiber optic cable deliverable over long distances,

dynamic pulsed thermal loading generation on the rock, laser beam collimation at a specific size

which may help reducing hole tapering. Laser/rock interaction test data show that Berea Grey

sandstone permeability in and around the lased area is enhanced due to clay dehydration and

micro fractures induced by the high temperatures generated in the rock while lasing [3]. Nitrogen

gas purging can be attached to the laser head and positioned near to the laser beam to clean the

bottom hole and help removing, melting rock and improving the rock removal [13]. Long laser

bursts dump more energy to the rock than that need for the local surface spallation, increase heat

input to the work piece. This excessive heat input during drilling produces a large heat-affected

zone, recast layer, and even micro-cracking and cause to melt the rock. These occurrences are

depicted schematically in figure1. In contrast, newer diode-pumped solid-state lasers, as shown

in figure2 [4], provide pulses with very short durations, in the Nano, Pico, or even femto-second

range. These short duration pulses deliver higher peak power intensity, easily penetrating the

plume, reducing the heat-affected zone, and virtually eliminating the recast layer and micro-

cracking. The process parameters that contribute to the efficiency of rock elimination by a pulsed

laser are: laser energy per millisecond, pulse width, pulse repetition rate, beam spot size, beam

relaxation time, purging gas configuration and gas flow rate. Selection of parameters must be in

a way that augments the rate of penetration (ROP). [3]

5

PLANNING OF DRILLING WELL

The planning of a well is a fundamental part of the drilling process – it is the basis for making all

the important technical choices, for assessing the costs and organizing the actual construction of

the well in the most efficient way. The well planning starts the moment when the interpretation

of the seismic data and the reconstruction of the geology of the area reveal the presence of a

structure favorable to the accumulation of hydrocarbons.

These data also enable an estimate to be made of:

• depth of the productive levels; stratigraphic and lithological sequences; problems that

could emerge in an operational phase.

Geologists prepare a document containing estimates and proposals for drilling the well on the

basis of the information in their possession obtained from:

• geological surface campaigns; regional geological studies; studies conducted on seismic

maps; profiles of wells already completed in the area.

This document is the introduction to the drawing up of the proper drilling program to give the

data necessary for:

well location, drilling objectives, foreseen of the final depth, forecasts of the litho-stratigraphic

profile, possible drilling problems that could be encountered, etc.

The analysis and processing of all this large mass of information provides the drilling engineers

6

with the essential elements for drawing up the drilling program.

These data are available from existing documents such as:

• Geological profiles; Well Logs; Pressure reports; Drilling reports; Drilling fluid reports;

Cementing reports; etc

Every well has its own specific features (depth, exploratory, development or appraisal well,

onshore or offshore, vertical, directional or horizontal..) but the basic criteria are the same for

all well types.

7

The first step to be taken by engineers to work out the drilling programme is to construct, the

trend of the pressure gradient curves according to depth (geostatic, pore pressure and fracture

gradients) to design the well casing profile.

CHOICE OF RIG, WELLHEAD AND BOP

The casing levels, the diameters and weight of the strings, the pressures and temperatures

concerned, and the volumes of drilling mud to be used, are all aspects participating in

determining the choice of rig type, blowout prevention systems (BOP, choke manifold, hydraulic

circuit) and wellheads.

The choice of rig is closely bound up with the depth it is wished to reach and with the weight of

the strings concerned.

According to the weights of the strings to be handled, rigs are used that have different

characteristics, and what is of basic importance is the strength of the whole assembly, (travelling

block, crown block, hook and derrick floor) from which the string hangs while being lowered

into the well.

In offshore activity, the choice of the rig is determined, not only by the weight of the strings, but

also by the depth of the water in the area of operations.

Drilling rigs installed on offshore vessels or platforms are built to reach the maximum possible

depths and have all the material and equipment necessary for drilling on board.

The composition of the wellhead depends on the pressures that can be reached during the various

working phases – both drilling and production – and on the diameters of the strings to be lowered

8

into the well.

CONTROL OF DRILLING OPERATIONS

The great complexity of the drilling process, its high costs, the need to ensure the full efficiency

of the rig and the respecting of safety and of the environment call for a continuous optimizing of

operations, which are achieved through the monitoring and processing of all available data, both

geological and drilling.

To reach these objectives, every drilling rig, and in particular those that have to drill complex,

deep and therefore costly wells, is endowed with more or less sophisticated mud logging units,

which permit – through appropriate sensors and the activity of specialized personnel – the

acquisition, processing and interpretation of a vast range of information of interest both to the

geologist and to the drilling engineer.

Mud logging units are equipped with sensors, positioned in appropriate parts of the rig,

permitting the automatic, continuous acquisition of the most significant parameters, and

advanced information systems, based also on expert systems, as the means of managing

operations in real time, with the consequent reduction of time and costs.

These sensors transmit their signals to a computerized system housed in the mud logging cabin,

which provides for their representation also in graphic form, their storage in special local data

9

banks, and the sending by means of radio links, dedicated telephone lines and communications

via satellite, of selected data to operational centres.

DRILLING COSTS

The drilling programme indicates also the budget that it is necessary to allocate to reach the

targets, and which has to be adhered to during the construction of the well.

The costs of drilling a well can vary, depending on the particular type of well planned and the

environment.

The budget contained in the drilling programme indicates the amount of the economic resources

available in the estimate, which has to be adhered to as far as possible; but it is obvious that the

real amount depends on the problems that crop up during drilling and on the capacity of the

engineers to address them promptly without compromising the achieving of the objectives.

WELL ABANDONMENT

If, when drilling has been completed, the well is productive hydrocarbons, a start is made on all

those operations that will ensure its economically advantageous working, whereas if, on the

contrary, it should prove to be barren or in any case not economically exploitable, it will be shut

down.

Well shutdown entails the restoring of the initial conditions of the section of the well not lined

and possibly also the lined part, if separation of the permeable levels of different pressure is not

assured.

10

The purpose of these measures is to prevent the transfer of fluids from one level to the other.

The final shutdown of a well must satisfy not only the requirements set out in the engineering

best practices fixed by the operator, but must also respond to all the requisites of law aimed at

safeguarding the environment and the safety of the people living in the vicinity of abandoned

wells.

SUMMARY AND CONCLUSION

The operations of Petroleum Drilling have attracted much importance since few decades. We

have discussed about various drilling operation and their functions in this project. The operation

procedure is found to be much important so that safe and efficient drilling activity is carried out.

Documents

Drilling Operations in Oil and Gas Home based Internship