XXX Development Facility Feasibility Studies

Doc #: YYY-DRL-PM-PEP-0001-C03 Jan 2015

XXX Development

Facility Feasibility & Option Selection Plan

C For Information Jan 3 2015 MR JM / SC DL

Rev Status Date Author Checker Lead EM PM

Document Title:

XXX Facility Feasibility & Option Selection Plan DRL Document No. Page

MOL-DRL-PM-PEP-0001-C1 of 16

Client Document No.

XXX Development Facility Feasibility Studies

Doc #: YYY-DRL-PM-PEP-0001-C03 Jan 2015

DW FEASIBILITY & OPTION SELECTION Rev C Jan 2 2015

Table of Contents

1  INTRODUCTION .............................................................................................................. 3 

1.1  FACILITY WORK PLAN SUMMARY .................................................................... 4 

2  WORKPLAN ..................................................................................................................... 5 

2.1  STUDY ACTIVITIES ............................................................................................. 5 

2.2  FEASIBILITY STUDIES ........................................................................................ 7 

3  OPTION SCREENING (QUALITATIVE SELECTION – PHASE 1) .................................. 8 

3.1  SCREENING SUMMATION ................................................................................ 10 

3.2  OPTION SELECTION PHASE 2 (QUANTITATIVE) ........................................... 11 

3.3  PHASE 2 OPTION SELECTION ......................................................................... 11 

3.4  HULL SELECTION .............................................................................................. 13 

3.5  RISK ASSESSMENT .......................................................................................... 14 

3.6  PHASE 2 OPTION SELECTION RESULTS SUMMARY .................................... 15 

4  VE STUDY ...................................................................................................................... 16 

5  FEASIBILITY & OPTION SELECTION GATE CRITERIA ............................................. 16 

6  CONTRACTING AND PROCUREMENT STRATEGIES................................................ 17 

7  FEED INPUT & ITT DATA .............................................................................................. 18 

8  STUDY TEAM ORGANISATION .................................................................................... 19 

8.1  STUDY TOOLS AND PROCEDURES ................................................................ 19 

9  DEVELOPMENT SCHEDULE ........................................................................................ 25 

9.1  SCHEDULING ..................................................................................................... 25 

XXX Development Facility Feasibility Studies

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1 INTRODUCTION This document presents a Study Plan to undertake the field development facility studies (Surface Facilities and Subsea) for YYY Development. The principles of the facility FE work will follow the following route map:

However, the field development requires the integration of subsurface, drilling, operations, commercial and facilities in an overall development plan – e.g. as typical below:

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Preliminary Cost, Schedule & FEED

Budget & Cost EstimatesO&M Philosophy & Operability

Preliminary Functional Basis (SOR)Contracting Strategy PlanContractor Tendering & EvaluationRegulatory BasisDeveloment plan (POD)

SUBSURFACEAppraisal Development

DRILLING

FEED

Contractor & Market Assessments

Multi Beam & AUV Surveys

Hull Selection StudiesUpdate Functional Basis Option Selection Evaluation studiesFEED Definition

SUBSEA

Riser Feasibility Studies

Metocean StudyFlow Assurance studiesField Architecture StudiesFlowlines & Export Lines Engineering

EXAMPLE PRE-SANCTION WORKPLAN

SURFACE PRODUCTION FACILITIESProcess and Facility Feasibility

Risk Assessment

2015

DEVELOPMENT MILESTONESExecutive Charter Brief

DEFINE ACTIVITIES SELECTFEASIBILITY

2014

Appraisal Well 1Appraisal Well 2

Preliminary PEPReviews

CHARTERSOR

STRATEGY

REGULATOR

RISK

DRILL TESTDRILL TEST

STUDIES - OFF/S

HULL SELECTION

SANCTION

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1.1 FACILITY WORK PLAN SUMMARY

This document presents an example front – end plan to mature a prospect through Option Selection, through to the FEASIBILITY gate and readiness to commence FEED and Tendering.

The document describes the following main steps:

1. Development Team Set-up & mobilization

2. Project Charter or Statement of Requirements (SOR)

3. Preliminary Functional Requirements

4. Feasibility Studies & Brainstorms (Demonstrate Technical & Economic Feasible Schemes

(Including riser performance vs hull form, flow assurance, field architecture, reservoir depletion requirements, oil and gas disposition options, etc.)

5. Development Option Screening

6. Final Option Selection

7. Feasibility Deliverables (FEASIBILITY) – Facilities (Surface and Subsea), G&G and Subsurface, Operations and Drilling

8. Value Engineering (VE)

9. Contracting Strategy

10. FEED Tender ITT Data

11. FE Study and Team Administration and Planning

Graphic representation of study stages:

Concept Selection

Field Planning

Feasibility studies

Concept Definition

Execution

Total field development level System / discipline level

±40%

±30%

±20%

±10%

Cos

t es

timat

es

Major building block level

Most likely to succeed technology

Most cost efficient concepts

Improved subsystems Improved

execution

Work Processes: - Front End Gate Process

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2 WORKPLAN

2.1 STUDY ACTIVITIES Initial study work activities focus on technical requirements and feasibility of the key building blocks – reservoir and well depletion requirements, field architecture, flow assurance, riser performance vs hull selection options, oil and gas export options etc.

STUDY TEAM SET-UP

Establish framework for Study Team to work efficiently and effectively:

Non-disclosure agreement Preliminary Study Plan and approach Document Control procedure and file structure Team Roles and Organization Reporting Charter (SOR) & Preliminary Functional Basis Brainstorm alignment sessions Preliminary Schedule Milestones Equipment Tagging procedure Team Office Facilities, Communications

A provisional suggested FE team would be organized as follows:

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A Preliminary Functional Basis for commencement of studies would include the following items. This functional basis will be developed thru several working sessions and data compilation.

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2.2 FEASIBILITY STUDIES This stage needs to determine technically feasible schemes, and an understanding of the limitations and definition of key building blocks.

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3 OPTION SCREENING (QUALITATIVE SELECTION – PHASE 1)

Once an understanding is established of feasible building blocks and credible schemes, then the option selection process can be commenced. Key elements are summarized as follows, and further defined in “DRL Option Screening Methodology (Phase 1 - Qualitative & Phase 2 - Quantitative).Procedures” – see attached.

Establish all the building blocks and brainstorm all credible options for base development, futures and potential 3rd parties. Requires involvement of all leading disciplines and management:

Agree screening selection parameters

Prepare preliminary Field Schematics and descriptions of main options and associated preliminary benchmark cost and schedules

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Screening Workshop to select leading options based on :

i. Relative Costing,

ii. Schedule

iii. Recoverable Reserves efficiency

iv. Technical Risk,

v. Integration and Installation Risk

vi. Operability & Reliability,

vii. Flexibility for futures

Typical screening parameters/characteristics tabulation:

Typical extract from Option Generator sheet including score tabulation of a rated option

STAND ALONE Reservoir System

CASE Name Reservoir

Drive

Relative Cost

Project Schedule

HC Reservoir Recovery and Yield

Technical Risk

Installation & HUC

Operability &

Reliability

SUM Comment

Tool Box

STA-YOL-ONS-MODU-400

FWS Onshore

3 3 4 4 4 5 23

This scheme will require a Duplex Pipeline to shore with high 11 percent CO2 and no - dewatering or phase split offshore. Scheme will also require complex and not yet proven subsea compression or onshore well boost compression. Both will result in higher well back pressure and upto 10 percent loss of reserves with higher abandonment pressure. Scheme also has a large, sophisticated gas and NGL plant to be built onshore. Incurs a high capex, high risk and reduced recovery and operability.

Depletion

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3.1 SCREENING SUMMATION

Must confirm that the concept schemes selected are robust to uncertainties of functional basis

Conduct Peer and Partner Reviews to confirm “buy-in”

Prepare Option Screening Report – highlight which options are more favorable, and indicative relative cost & schedule.

Important to clearly define why certain options were rejected or not appraised, to avoid future recycling.

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3.2 OPTION SELECTION PHASE 2 (QUANTITATIVE) The study plan assumes that several options are comparable in the Screening Option Analysis (phase 1) and require further evaluation. This next phase (Phase 2) of option selection focusses on improved cost quantification and also a Risk Assessment.

The Phase 2 Option Selection Methodology objectives are as follows:

Utilize a short list of options selected in the Phase 1 Qualitative Analysis.

Prepare preliminary cost and schedule estimates, plus a risk – weighted analysis of the “soft issues” for the Phase 1 Short Listed Options as follows:

Undertake a risk weighted analysis of the selected options resulting from the Phase 1 study. This analysis appraises the relative benefits and risks of each major building block of each option, and accounts for their relative weighting within each option.

Prepare capex estimates of the options (+/- 30%)

Review the results from the above cost and risk rankings and establish a short list of development options for further definition in pre FEED Conceptual Design.

3.3 PHASE 2 OPTION SELECTION The Phase 2 Study Scope has two main activities:

Preliminary Design and Costing of the selected options

Risk Weighted Analysis of various “soft issues”

The costings are developed based on the respective option building blocks. Typically for each option there will be a cost work breakdown structure as follows:

Topsides Facilities cost based on weight

Onshore Facilities cost based on functionality and capacity

Drilling system cost (if platform installed)

Substructure cost (Platform / TLP / Semi / FPSO)

Mooring and Piling Cost

SURF cost (subsea/umbilicals/ risers/ flowlines/ )

Pipelines ($ per inch diameter)

Transport and Installation Cost

Associated indirect costs (multiplier)

The offshore facilities costs are based on weight estimates derived from correlations of “installed driver power” and topsides weight – which provides a weight relationship for platform functionality – including capacity, required unit operations and associated duties and pressures.

DRL has a complete suite of benchmarked costs based on actual deep water projects in GOM, covering topsides, hulls, mooring systems, risers and pipelines. Sample data below.

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3.4 HULL SELECTION The Hull Selection is a key key deepwater development choice, and should be evaluated globally as above, and again independently as a subset study and workshop as summarized below. This key selection will involve a preliminary assessment of the respective riser and mooring system performance, payload assessment, regulatory acceptance, integration and installation method and contracting strategy. The flowsheet below shows the design inter relations for a deepwater FPU.

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3.5 RISK ASSESSMENT The comparative risk evaluation is based on a soft ranking process in which a number of developed project elements (building blocks) for each option are examined against specified criteria parameters and a relative weighting.

Building BlocksBuilding BlocksSelected Risk CriteriaSelected Risk Criteria Building Block Weighing FactorBuilding Block Weighing Factor

Risk Criteria Weighing FactorRisk Criteria Weighing Factor Risk Criteria ScoreRisk Criteria Score

Option Resulting ScoreOption Resulting Score

Option LabelOption Label

Building BlocksBuilding BlocksSelected Risk CriteriaSelected Risk Criteria Building Block Weighing FactorBuilding Block Weighing Factor

Risk Criteria Weighing FactorRisk Criteria Weighing Factor Risk Criteria ScoreRisk Criteria Score

Option Resulting ScoreOption Resulting Score

Option LabelOption Label

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3.6 PHASE 2 OPTION SELECTION RESULTS SUMMARY

Example tabulation of the Risk Scoring and Capex estimation for the Quantitative Selection Phase:

This final option analysis is aimed at recommending a single option to proceed into to FEED and Execution.

3.6.1 OPTION SELECTION APPROVAL AND FEASIBILITY PACKAGE

Workshop and Peer - Partner participation

Preparation of FEASIBILITY Delivery Package

i. Subsurface

ii. Facilities

3.6.2 ECONOMICS Preliminary Execution Plan with Contracting Strategy

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4 VE STUDY Examine opportunities for cost reduction and re-confirm project efficiency through benchmarking.

5 FEASIBILITY & OPTION SELECTION GATE CRITERIA

This stage gate establishes that the development is technically feasible and economically robust, and is adequately defined to proceed into definition (FEED) phase. Typical acceptance criteria can be summarized as follows:

XXX Development Facility Feasibility Studies

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6 CONTRACTING AND PROCUREMENT STRATEGIES

Contracting strategy interacts with contractor selection, schedule duration and integration location, and installation responsibility.

Example Deepwater Floater Contracting Options:

 1. TYPICAL EPC(I) 2. FEED COMPETITION

3. NEG EPC(I) BEFORE FEED

4. OWNER PMT

&SUBS

5. OWNER & ENG PMT WORK ON UNIT

RATES

6. OWNER FEED & SUB EPCs

 

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BUSINESS NAME

Concept Screening and Pre-Feasibility Engineering

OWNER

OWNER

OWNER

OWNER

OWNER

OWNER

Front End Engineering Design (FEED) EPC EPC EPC

EPC EPC EPC

Detail Design EPC EPC EPC

EPC EPC EPC

EPC EPC EPC

EPC EPC EPC

Fabrication EPC EPC EPC

EPC EPC EPC

EPC EPC EPC

Integration EPC EPC EPC

EPC EPC EPC

EPC EPC EPC

Installation and Hook Up EPC EPC EPC

EPC EPC EPC

EPC EPC EPC

Commissioning, Handover and Acceptance

EPC EPC EPC

EPC EPC EPC

EPC EPC EPC

EPC CONTRACTOR

INSTALLATION CONTRACTOR

ENGINEERING CONTR

CONSULTANT IN HOUSE

OWNER

SEPARATE SUBCONTRACTS

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7 FEED INPUT & ITT DATA Maturation of the Functional Basis to a Design Basis Datasheet Book for FEED

development to a BOD Spec.

Preparation of CTRs and RFP scope for FEED Tendering

The input to FEED or FEED EPC Tender should include typical deliverables for a floater as follows:

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8 STUDY TEAM ORGANISATION

8.1 STUDY TOOLS AND PROCEDURES

8.1.1 FILE MANAGEMENT To permit fluent working files and easy access and viewing by team members including XXX, DRL utilizes the BOX Cloud technology. DRL will set up a dedicated and customized folder structure for the Study. A sample file structure is illustrated below:

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8.1.2 EQUIPMENT NUMBERING Alignment on numbering system and issuance of relevant procedure will be performed at the very beginning of the study to eliminate re-work of re-numbering in early design work.

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8.1.3 REPORTING A weekly report of the Study Team progress will be prepared for issue by the Project Manager to XXX Management. The format of the Study Team weekly report may follow XXX’s internal standard or use a DRL report format.

DRL will provide a weekly tracking report (sample below).

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8.1.4 ACTION REGISTER An action register will be used throughout the study period to record action items raised at meetings, discussions and received from management. This tabulation of actions will be maintained expedited by the Project Engineer. The format of the action register is provided below:

8.1.5 ASSUMPTIONS REGISTER During the course of the Study execution numerous assumptions will be required (in the absence of data, approvals or management decisions) as the basis for further work. These assumptions and their basis will be recorded in the Assumptions Register.

8.1.6 RISK REGISTER A risk register of cost, schedule and HSE risks will be used to collect and manage the issues raised during the course of the Study. Mitigations and close out of the risks will be recorded. Key risks will be included in management reports. The format of the Risk Register document can be seen below.

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8.1.7 DELIVERABLES REGISTER A deliverable register of Study documents with issue dates will be developed and maintained as the study definition takes shape. A typical study deliverable register can be seen below. The YYY deliverable register will include those documents required for FEASIBILITY Stage Gate (Refer to Appendix A-2) and technical attachments needed for FEED ITT.

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e

XXX Development Facility Feasibility Studies

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9 DEVELOPMENT SCHEDULE

9.1 SCHEDULING It is important to develop an integrated plan for field development, so as to ensure all the functions come together in a coordinated manner, and the surface and subsurface groups develop their respective areas in conjunction and at the required level of maturity- ie in synch. An example deepwater FE plan is summarized below:

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Preliminary Cost, Schedule & FEED

Budget & Cost EstimatesO&M Philosophy & Operability

Preliminary Functional Basis (SOR)Contracting Strategy PlanContractor Tendering & EvaluationRegulatory BasisDeveloment plan (POD)

SUBSURFACEAppraisal Development

DRILLING

FEED

Contractor & Market Assessments

Multi Beam & AUV Surveys

Hull Selection StudiesUpdate Functional Basis Option Selection Evaluation studiesFEED Definition

SUBSEA

Riser Feasibility Studies

Metocean StudyFlow Assurance studiesField Architecture StudiesFlowlines & Export Lines Engineering

EXAMPLE PRE-SANCTION WORKPLAN

SURFACE PRODUCTION FACILITIESProcess and Facility Feasibility

Risk Assessment

2015

DEVELOPMENT MILESTONESExecutive Charter Brief

DEFINE ACTIVITIES SELECTFEASIBILITY

2014

Appraisal Well 1Appraisal Well 2

Preliminary PEPReviews

CHARTERSOR

STRATEGY

REGULATOR

RISK

DRILL TESTDRILL TEST

STUDIES - OFF/S

HULL SELECTION

SANCTION