The 4th Petroleum Forum: Approaching to the 21 Petroleum ... 8-10.pdf · 2ndnd Challenge • Safety & Environment ... Thailand Oil & Gas IndustrThailand Oil & Gas Industryy What we

Witsarut Thungsuntonkhun

Senior Petroleum Engineer, Department of Mineral Fuels

26 May 2011, Bangkok Thailand

The 4th Petroleum Forum: Approaching to the 21st Petroleum

Concession Bidding Round

Global Warming, Climate Change, GHG Emission, Global Warming, Climate Change, GHG Emission, Another Challenge for E&P BusinessAnother Challenge for E&P Business

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Major Challenges in Oil & GasMajor Challenges in Oil & Gas

Discovery

Gas in GOT

11stst ChallengeChallenge

The BeginningThe Beginning • Complex geological structures

• 3-D Seismic

• Slim hole drilling

• Coil tubing

22ndnd ChallengeChallenge

• Safety & Environment

• Banned OBM & Use

of SBM

• Waste Management

• Produced Water

Re-Injection

New ChallengeNew Challenge

Global Global WarmingWarming

Globalization: The world smaller & no border More public concern & participation

Health Safety & Environment Issues

Waste Management

Decommissioning

Global Warming

The New Challenge: Global WarmingThe New Challenge: Global Warming

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““ItIt’’s a Global Commitments a Global Commitment””

Thailand Oil & Gas IndustryThailand Oil & Gas Industry

What we have done What we have done • Promoting flare gas utilization project for energy conservation &

efficiency, in addition with reducing environmental impact

1. Using flare gas from onshore oil field

- To produce electricity from small power generator

- To substitute LPG for producing food (Snack) from Agriculture products (Fried bananas, potatoes, etc.)

- To be a raw material for producing LNG (Liquefied Natural Gas)

2. Improve the gas production process to reduce the amount of flare

• Encourage the concessionaire to develop the flare gas utilization to be the CDM (Clean Development Mechanism) Project

The CDM project in Oil & Gas IndustryThe CDM project in Oil & Gas Industry

•• CDM Development for Sao CDM Development for Sao ThianThian--A Oil Field Flare Gas A Oil Field Flare Gas

Recovery and Utilization Project by PTTEPRecovery and Utilization Project by PTTEP

•• CDM Development on Vent Gas Recovery from Well CDM Development on Vent Gas Recovery from Well

Unloading Units Project by ChevronUnloading Units Project by Chevron

Sao Sao TianTian--A Oil Field, A Oil Field, SukhotaiSukhotai ProvinceProvince

Baseline BoundaryBaseline Boundary

Separator

Project oil wells

CO2

Associated gasLiquid (crude oil+ water)

Remarks:

Liquid

Project Baseline

FT

Project baselineFlow TransmitterFT

DieselGenerator

CO2

Flare

Sao Sao TianTian--A Oil Field, CDM DevelopmentA Oil Field, CDM Development

Project BoundaryProject Boundary

Flare

Separator

Project Oil Wells

Fuel Gas Skid System (Skid#2)

External Buyer (RE)

On-site Consumption

CO2

Associated GasRemarks:

Fuel Gas Skid System (Skid#1)

Sale Gas Metering System

Liquid

Project Boundary

FT

FT

Project BoundaryFT

Additional Investment for CDM Project

0.8 MMscfd

0.25 MMscfd

Flow Transmitter Liquid (Crude Oil + Water)

Sao Sao TianTian--A Oil Field, CDM DevelopmentA Oil Field, CDM Development

Emission Reduction ≈ 31,000 ton CO2eq/year

BenchamasBenchamas Oil Field, Gulf of ThailandOil Field, Gulf of Thailand

BenchamasBenchamas Oil Field, CDM DevelopmentOil Field, CDM Development

• Use the compressor unit to recover vented gas from well unloading unit at wellhead platform back to the gas production process

• Estimated emission reduction 14,000 ton CO2eq/year

Well Unloading Unit Compressor Unit

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Source: Thailand Greenhouse Gas Management Organization (Public Organization), www.tgo.or.th

Next step to Face Global Warming (Post 2012)Next step to Face Global Warming (Post 2012)

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18Energy Technology Roadmap (Source: IEA)

How do we cope with the Global Warming?How do we cope with the Global Warming?

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Source: IEA

20Source: IEA

Key Technologies to Reduce GHG Emission Key Technologies to Reduce GHG Emission

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A Global Technology Revolution is neededA Global Technology Revolution is needed

Source: IEA

22Source: IEA

An Ambitious CCS RoadmapAn Ambitious CCS Roadmap

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CCS OpportunityCCS Opportunity

Source: Thailand Greenhouse Gas Management Organization (Public Organization), www.tgo.or.th

24Source: Thailand Greenhouse Gas Management Organization (Public Organization), www.tgo.or.th

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ConclusionConclusion

To face the Challenge in Global Warming:

1. Set up a standard for calculating GHG Emission from Oil & Gas Industry (based on API & IPCC standard)

• To have the accurate GHG inventory for oil & gas industry in Thailand

• To efficiently reduce the CO2 emission Oil & Gas activities

2. Encourage & Support the concessionaires to develop the CDM Project

3. Study the potential and possibility of CCS Project

• Need help on knowledge sharing, capacity building, technology transfer.

• Comprehensive study on storage potential, capture & transportation technology, legal & finance issues for Thailand

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T H A N K Y O UT H A N K Y O U

Application package

www.dmf.go.th

Thailand’s Energy Policy

• Promoting the domestic oil-and-natural-gas exploration and production• National Power Sufficiency• Diversify National Energy Portfolio

• Building market pricing mechanism• Founding independent regulatory organization• Encouraging investments • QA and safety

• Promoting Biofuel Ethanol Biodiesel• NGV• Power Generation with RE Solar Wind Biomass,…

• Clear and Strict objective• implementation of measures

(Bulbs, Standby Power, ….)

• Lowering CO2 emission• Promoting CDM• Controlling vapour (VRU)• Lowering Flare Gas emission

What should we do nextWhat should we do next

1. Set the standard to estimate and collect GHG Inventory for oil and

gas industry in Thailand (based on API & IPCC standard)

- To be a guideline for the concessionaires to estimate the GHG

emission from oil & gas activities

- To have the accurate amount of CO2 emission from oil & gas

industry

- To efficiently reduce the CO2 emission

2. Study the Feasibility of CCS projects in Thailand

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• 1.6 MMSCFD Associated gas from Nongtum Oil Field

• ≈ 15 Ton of LNG (90% CH4)

• ≈ 12 Ton of Liquid Hydrocarbon (90% C2, C3, C4, C5+)

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Storage and Transport of Petroleum (Section 54)

Sale and disposal of petroleum (Section 56)

Guarantee for the concessionaires regarding their ownership of land and right of entry upon possessed land (Section 65 , 66 , 67)

Guarantee for the concessionaires regarding preservation of their properties and rights ( Section 64)

Import of foreign experts, specialists and skilled workers (section 69)

Import of materials and equipment without duty and VAT (Section 70)

Exemption of administration tax - excluding income tax, royalty and fees of services (Section 71)

Right of retaining, taking or remitting abroad money in foreign currencies (Section 78)

Types of Applicants

How to exercise Privileges

Periods of Privileges

Concessionaires Contact DMF directly through their concession periods

Direct Contractors Apply under concessionaires within the period of

agreements

Privileged Contractors Contact DMF directly up to two years at a

time.

Qualifications of Applicants

Section 69

1. Full Name ……………

2. Nationality ……………

4. Position …………………

3. Passport No. ………….

5. Reasons of necessity in importing experts & specialists…................

Cover Letter to DMF

Attachments

Levels of Experts & Specialists

Education Experiences

Technical Undergraduate degrees ~ 5 years of experience in the petroleum business

~ 2 years of offshore experience for offshore positions

Non - technical Undergraduate degrees ~ 4 years of experience in the petroleum business

Skilled workers Certificates or diplomas ~7 years of experience in the position

~ 5years of offshore experience for offshore positions

Others(Trainees *)

Undergraduate degrees Lower than those mentioned above

* International personnel exchange, use of Thailand as a regional operation center.

Qualifications of Experts and Specialists

Ministerial Regulation No. 17 (B.E. 2532) , under Clause 11,

‘The concessionaire must hire

under their qualifications to conduct petroleum operations under this

concession. If, however, Thai nationals suitable for some positions cannot be

found, the concessionaire will do its best to to

become more skilled to assume all positions in the business within due time.

“Concessionaires and direct contractors may import machinery,

apparatus, equipment, structures, vehicles, equipment parts, and

other materials needed for the businesses, subject to zero tariff

under the customs and value-added tax laws under the revenue

code. However, such items must first be ruled by the Petroleum

Committee as necessary for the businesses. Concessionaires may

appeal the ruling of the Committee to the Minister within 30 days of

the date of receipt of ruling. ...”

Section 70

Master List

Documents required for Section 70 Application

No. TasksPeriods (Days)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

1Collect incoming applications for the past month

2Applicants reach the working group and the director‐general

3 Applicants reach the subcommittee

4Applicants reach the Petroleum Committee

69 & 70 Application and Deliberation Periods69 & 70 Application and Deliberation Periods

Operation Supervision Group, Petroleum Concession Division, Department of Mineral Fuels,

Ministry of Energy

21st Floor, Energy Complex Building B,555/2 Viphavadi Rangsit Road, Chatuchak, Bangkok 10900

Tel: 0-2794-3513-19 Fax: 0-2794-3470

g{tÇ~ lÉâQ & A

Concessionaires’ Direct Contractors (Contractors)

These include contractors directly hired by concessionaires

with service agreements concerning exploration and production.

Privileges granted by DMF directly to contractors to proceed under

Sections 69 and 70.

As a rule, contractors must file applications for the privileges under

Sections 69 and 70 under the privileges of concessionaires. However,

for those contractors who provide substantial volumes of services to

many concessionaires, DMF makes an exception by allowing those

qualified to apply directly for prompt, efficient, and beneficial service to

concessionaires.

Privileged Contractors

Criteria for privileged contractors.

1) An agreement for providing exploration and production services to a given concessionaire

2) A minimum of two years’ experience of application of that concessionaire’s privileges under Sections 69 and 70

3) A sustained volume of work during the past two years and demonstrated service efficiency

4) Several service agreements or long-term ones for concessionaires

5) A certifying letter from each concessionaire with a contractor service agreement for use as a back-up

6) Evidence of financial security dating back three years,including the registered capital, assets, and financial statements

7) Detailed storage system(s) of imported materials and equipment under Section 70 for inspection by DMF.

© 2010 Chevron

Integrated Environmental Management for Upstream Operations

Doungporn Surasawait, Environmental EngineerThe 4th Petroleum Forum, May 26-27, 2011

© 2010 Chevron

Presentation Outline

Chevron’s Environmental Management

Environmental Processes– Property Transfer

– Environmental, Social and Health Impact Assessment

– Environmental Stewardship

– Legacy Site Aspects

Summary

© 2010 Chevron

Chevron’s Core Values

Protecting People and the Environment– We place the highest priority on the health and safety of our workforce

and protection of our assets and the environment.

– We aim to be admired for world-class performance through disciplined application of our Operational Excellence Management System.

© 2010 Chevron

Our Goals to Protect the Environment

© 2010 Chevron

Environmental ManagementKey Principles

Drive performance in both existing and new operations

Cover full life cycle of upstream asset

One process per stage of upstream asset life cycle

Set the floor in key areas with Environmental Performance Standards

Use environmental processes to drive continual improvement

© 2010 Chevron

Environmental Management

6

Acquisition Planning Operation Sunset Divestment

Property Transfer* ESHIA*

Environmental Stewardship**

Site Assessment & Remediation

Property Transfer*


Property Transfer

Environmental, Social and Health Impact Assessment

Environmental Stewardship

Legacy SiteAspects

Property Transfer

Third -Party Waste process Offshore Drilling Discharges EPSFlaring & Venting EPSProduced Water EPSWaste Management EPS

-

Third – Party Waste Stewardship

Offshore Drilling Discharges EPSFlaring & Venting EPS

Produced Water EPS

Waste Management EPSAir Emission EPSNatural Resources EPS

Environmental management covers full life cycle of upstream asset

© 2010 Chevron

Environmental Performance Standards set the Floor


Flaring and Venting

ProducedWater

Drill Cuttings

WasteManagement

Air Emissions

Natural Resources

Environmental Processes Drive Continual Improvement


Legacy Site Aspects

Property Transfer


Environmental Performance Standards set the floor for environmental performance

© 2010 Chevron


8





Property Transfer*


Property Transfer


Legacy SiteAspects

Property Transfer



-



Produced Water EPS


© 2010 Chevron

Property Transfer

Property Transfer is a process to identify and manage health, environment and safety (HES) risks as part of all property transfer transactions.

Property Transfer is applied to acquisitions, divestitures and mergersinvolving transfers of real property including real estate and used equipment that has the potential to impact health, safety, and the environment (e.g., air, land, or water).

HES risks are identified and assessed through appropriately scoped due diligence and addressed in the purchase and sales agreement as appropriate for that asset and transaction type.

© 2010 Chevron


10





Property Transfer*


Property Transfer


Legacy SiteAspects

Property Transfer



-



Produced Water EPS


© 2010 Chevron

Environmental, Social and Health Impact Assessment (ESHIA) Process

The ESHIA Process is designed to identify, consider and manage potentially significant project-related environmental, social and health impacts in a consistent manner.

ESHIA is similar, but not equivalent to an EIA.

ESHIA helps to improve decision quality throughout the project life cycle and consider project development options that are most effective in minimizing potentially significant impacts.

ESHIA also provides greater understanding of community needs andexpectations, enabling Chevron to promote sustainable community benefits.

ESHIA management plan is developed and delivered to an operation team

Chevron ESHIA

Regulatory EIA

Overlap

© 2010 Chevron


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Property Transfer*


Property Transfer ESHIA Environmental

StewardshipLegacy SiteAspects

Property Transfer


-



Produced Water EPS


© 2010 Chevron

Environmental Stewardship (ES) Process

ES is utilized to identify and address significant environmental aspects by maintaining appropriate environmental management programs and implementation of improvement programs to drive continual improvement in environmental performance in a systematic manner.

Greater efficiencies in environmental management are achieved through a systematic, integrated consideration of all environmental aspects.

Alignment with ISO 14001 is facilitated.

Identify significant environmental

aspects and maintain environmental management

program

Set environmental objectives and

targets

Continual improvement in environmental performance

© 2010 Chevron

Environmental Stewardship Process Cycle

Output: Environmental Aspect Register

Output: Environmental Aspect Register

Output: Environmental

Stewardship (ES) Plan

Output: Environmental

Stewardship (ES) Plan

Input: Facility changes or modification

Input: Facility changes or modification

© 2010 Chevron


15





Property Transfer*


Property Transfer


Legacy SiteAspects

Property Transfer



-



Produced Water EPS


© 2010 Chevron

Legacy Site Aspects

Legacy Site are long-term inactive wells and facilities (>5 yrs), wells and pipelines designated for abandonment, facilities designated for decommissioning, impacted soil, sediment or water, other sources of potential contamination and land designated for reclamation

Legacy Site Aspects shall be utilized to systematically manage retirement activities and mitigate any significant risks associated with legacy contamination.

An inventory of legacy sites and an asset retirement strategy and work plan for legacy sites shall be developed in a systematic process.

© 2010 Chevron

Summary

Chevron’s Operational Excellence Management System (OEMS) has been attested by International Standard Organization (ISO). The integrated environmental management meets the requirements of ISO 14001.

The effective integrated environmental management enables us to identify and address environmental issues effectively and consistently in all Chevron operating areas.

Comments

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Questions

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