ExxonMobil is helping Abu Dhabi’s Zakum Development Company – ZADCO ramp up production at the enormous Upper Zakum offshore oil field.
One of the world’s giant offshore oil fields is undergoing a production transformation with the help of the world’s largest oil company. The vast recoverable reserves of the Upper Zakum field, located 84 kilometres north west of Abu Dhabi Islands, have been estimated by various energy agencies in the 50 billion barrels range, and by ZADCO’s estimates, Zakum stands as the second largest field in the Gulf, and the fourth largest in the world.
The offshore behemoth is the most important of ZADCO’s fields and covers around 1200 Km2 of the Gulf marine areas, and crucially, industry analysts have estimated that only 10 to 15 percent of the recoverable total has been produced to date.
The numbers involved are mind boggling. ZADCO currently operates around 450 wells from offshore platforms, and the accommodation platform of Upper Zakum field has the capacity to cater to 550 personnel, making it one of the largest offshore living structures in the world.
Back in March 2006, Exxon Mobil and its regional subsidiaries signed agreements with Abu Dhabi National Oil Company (ADNOC), through which ExxonMobil Abu Dhabi Offshore Petroleum Company (EMAD) received a 28 percent undivided interest out of ADNOC’s 88 percent interest in the Upper Zakum Oil Field. The deal structure stipulated that ADNOC retained a majority 60 percent interest, while Japan Oil Development Company Limited (JODCO) held the remaining 12 percent interest.
ExxonMobil, with ADNOC and JODCO, provide technical and physical support to the joint operating company, Zakum Development Company (ZADCO), in pursuing the objective of increasing production by around 50 percent to a target capacity of 750 000 barrels per day.
“ExxonMobil was selected from a field of competing companies based on demonstration of its technical capabilities, but this particular deal can trace a partnership heritage back with Abu Dhabi more than sixty-five years,” explains Michael Perry, vice president Exxon Al Khalij.
“We signed the agreements for Upper Zakum in 2006, and it is a very exciting joint venture for us, as it stands among the largest offshore oil fields in the world.
At the time the deal was signed, His Excellency Yousef Omair bin Yousef, Secretary General of the Supreme Petroleum Council and the ADNOC CEO, said we were selected for the joint venture on the back of our wealth of expertise, but particularly cited the state of the art technology that we could bring to the table,” adds Perry.
“It was clear that the ADNOC group were looking for a company which could deliver experience and expertise from all over the world with challenging reservoirs, to complement their own very intimate knowledge of that reservoir, and we think they made a good choice. The feedback has been really positive and we are pleased with progress to date at Upper Zakum due to the combined efforts of ZADCO, JODCO and ExxonMobil.”
Perry says that a big part of the equation, for all parties, has been the people involved at the sharp end of production, and what they can contribute to the joint venture.
“The people we put in are experts in the applicable technologies or process, so you can imagine that most of the people working in the JV are very experienced and very senior staff, so whilst there is technology involved, this is one more way this partnership adds value. It’s expertise, technology, and getting the right people to maximise that combination.”
Knowledge shift
A further benefit to the partnership is that the development challenges are being overcome as a team, which has fostered a dynamic learning environment. “We’re pleased to be closely cooperating with ADNOC in the areas of training and development of human resources.
Sometimes just by working in proximity there’s a knowledge transfer almost by osmosis, and that works both ways. Part of the way ExxonMobil has garnered such worldwide experience is by working with experts in their own territories,” explains Perry.
“That said, some of that knowledge shift is more systematic. We’ve delivered advanced training in Abu Dhabi, and we’ve sent several UAE national employees of ZADCO to Houston for training. On top of this several ZADCO employees have been taken into developmental assignments in the US with ExxonMobil. In this way they bring back knowledge and expertise which will be beneficial to the whole joint venture.”
The technology that ExxonMobil has brought to the Upper Zakum field has been used elsewhere with great success. Indeed, much of the company’s advantage sits with its proprietary software tools, such as its EMPower reservoir engineering suite.
“The EMPower reservoir simulation tool is allowing the venture to make better decisions about reservoir management, with all the future tangible benefits that come with that,” says Perry.
Beyond Zakum
Perry says the experience of working with ZADCO has been an overwhelmingly positive one, and he is excited about the future opportunities to bring proprietary tools to the challenging environments in the Middle East.
“The fact is that looking ahead at the future energy challenge; we’re all going to have to get more imaginative, more creative and more intelligent to find workable solutions. You can’t alternative your way out of it, you can’t offshore drill your way out of it, and you can’t energy efficiency your way out of it. It has to be a combination of all of these components to meet the
energy challenge.”
Speaking from the ExxonMobil demonstration stand at January’s World Future Energy Summit in Abu Dhabi, Perry added that additional hydrocarbon production will have to be complemented by increased efficiency in their use.
“Even with the best developments underway, it’s still going to be hydrocarbons that are the primary source of our energy for many years and decades to come. We’re going to have to keep going after these challenging resources like tight and sour gas, and we are confident we’ll have an important role to play in finding these solutions.
In the past we’ve worked with some of the most challenging fields on the planet, so there’s a great deal we can bring to JV projects in the future,” he concludes.
