This paper describes the drilling planning processes adopted by Sabah Shell Petroleum Company Limited. (SSPC) in respect of the technical and commercial approaches undertaken for the first deepwater exploration well currently scheduled to be drilled in mid-1997. The issues related to well design methodology, operations planning, rig selection process and the contracting strategy to drill the exploration well are discussed. Planning and execution of deep water drilling present enormous technological challenges and so, coupled with the extremely high costs, it is crucial to plan all facets of rig selection/operations for optimal rig utilization.

Due to the growing demand and renewed interest in deepwater rigs, the situation is in favour of the supplier. Our approach is to provide a medium to long term commitment by establishing a regional deepwater drilling sequence with the participation of several SHELL Operating Units (OUs) in the Asia / Pacific region. This is to ensure adequate workload for the prospective drilling contractor to provide a rig at economically attractive operating rate. Such cooperation has resulted in a regional Rig Sharing Agreement that can be entered into by all participating OUs. The Agreement lays down the ground rules governing the sharing of the rig and its supporting services with respect to equitable costs / risks apportionment.

High complexity and interfunctionality of the issues related to deepwater drilling experienced by other Operators clearly show that a separate and dedicated integrated project team is essential to ensure optimal well planning, operations and control. A regionally based team, consisting of highly-experienced personnel, has therefore been set up as the central body of expertise. The formation of such a team has been possible by pooling expertise within the SHELL group. The team has been tasked to acquire the rig and assist in the planning and drilling of each well in the sequence as well as the formulation of Operating Procedures / Manuals and the application of technology in the deepwater drilling campaigns. The partnership has capitalised on the experiences gained in other parts of the world to identify the best practices and procedures.


SSPC is planning to drill its first exploration well in the SB-G deepwater acreage in mid-1997. In the most likely scenario, a second well will be drilled back-to-back, the timing for the second well would follow some three months after that for the first well. The first well would be targetted at a prospect in water depth of 850m, the second would be in water depth of more than 1000m.

Due to the tightening of the deepwater rig market, a regional deepwater drilling sequence was initially set up between several SHELL Companies operating in Brunei, Philippines and Australia in order to ensure availability of a deepwater drilling rig. Due to a change in plans the possibility of including other operators in the region is currently being explored.

Planning of deepwater exploration wells requires a very different approach from ordinary well planning. Extremely high rig costs make it necessary to plan all operations with optimal rig use. The complexity and inter functionality of the issues that emerged during an in-house workshop held in April 1996 and similar deepwater exploration experience in other OU's clearly shows that a separate cross-functional team is required to ensure adequate deepwater well planning.

Against the forgoing, SSPC has developed a Deepwater Drilling Performance and Planning Document based primarily on the experience drawn from Shell Philippines Malampaya drilling campaigns. Additionally, a Rig Sharing Agreement was formulated in order to share any upgrading, mobilisation and demobilisation costs, optimise continuous use of the rig for a reasonable period in order to attract acceptable rigs to the region at an acceptable rate and minimise the learning curve.

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