Introduction to Offshore Structures - Offshore Structures: Design, Construction and Maintenance - page 7

phase. Past experience indicates that at the start of the construction phase, the
accuracy of the TIC estimates is approximately

± ±

10%.
In most cases, the owner is mainly focused on the early production phase.
As an example, in one case, after the drilling and completion of 18 wells
from a satellite well protector, a production rate of 100,000 bpd (barrels per
day) is reached immediately after the installation of the production platform.
After one year from the production platform installation, all 36 wells are com-
pleted and a production rate of 200,000 bpd is reached.
In another example, in the North Sea, after installation of a single self-
contained tower, a period of about three months has to elapse before a produc-
tion rate of 6000 bpd may be achieved, and about two and a half years after
platform installation are required to drill and complete all 36 wells, reaching
a production rate of 200,000 bpd.
For the self-contained tower, the highest negative cash flow occurs within
the second quarter of the third year, when some oil production starts. From
this point on, positive cash flow from the produced oil will start offsetting
the negative cash flow from early investments and operating costs. The zero
cumulative cash flow position is reached within the fourth quarter of the fourth
year, when all the field investments to date have been paid off.
The maximum negative cash flow for the multiplatform concept is reached
six months ahead of that for the self-contained platform, sometime within the
first quarter of the third year, when oil flow from the production platform starts.
Due to the heavy upfront investment on a satellite platform and the early drill-
ing program, the maximum cash invested will be about 30% more than that for
the self-contained platform. However, rapid cash recovery from early drilled
production wells rapidly offsets the negative cash flow. Within the first quarter
of the fourth year, the zero cumulative cash flow point will be reached, about
six months ahead of the self-contained platform concept. From this point on,
the multiplatform concept results in higher cumulative cash flow.
For increased gas production in later years, the addition of a gas treatment
and compression platform may also be planned. In this case, satellite drilling
platforms may be constructed and installed within a six-month timeframe to
allow early drilling to commence. Within three years, production starts and
the additional drilling platform is installed. Once a significant number of the
satellite platform wells are drilled and completed, a large volume of production
can start.
A two- to three-year drilling cycle for the field-development program gen-
erally follows a self-contained platform installation. In some cases, some of the
wells may be drilled before the tower is set in location or a successful explora-
tory well may be utilized, resulting in some early production. But, in general,
about three to four years have to elapse after platform installation before the
total field production rate can be reached. This concept generally allows reach-
ing top production rates about a year or so earlier. The upfront cash available for
investment may vary from one oil company to another. If plenty of cash is

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