Abstract
Nowadays, exploration efforts are becoming harder taking into account that worldwide new hydrocarbons have been discovered in frontier areas such as deep water fields and artic oil, as well as, remote, almost inaccessible and environmentally sensitive places, such as oil and gas fields in the Ecuadorian and Peruvian jungle. Monetizing hydrocarbons in such sensitive places require time and addressing technology, logistics, commercial and environmental-social issues.
Many companies and governments have shifted his strategies to look "new oil" in mature fields either by redefining development strategies or by applying enhanced recovery technology. Based on experience and application in many oilfields in the region, some key parameters were identified as critical to bring new life to brown fields.
Based on worldwide experience, three (03) key parameters are considered critical to incentive and promote "re-development strategies" in brown fields in Peru for new bidding processes ratio of proved reserves replacement, royalty taxes based on financial performance (ratio between NPV and CAPEX) and an "incremental profit" for secondary and tertiary oil.
The purpose of defining a 100% ratio of proved reserves replacement is to set a threshold production curve for bidders that will assure an extended production life of the hydrocarbon asset even after finalizing the new contract period. The ratio of proved reserves replacement is focused on fostering short-term strategies such as production optimization, reactivation of wells and infill drilling; since this key indicator is focused on increasing progressively proved reserves as companies redeveloped the fields, they will be comfortable to deploy investments under "low risk scenarios" to increase recovery factor in mature fields. In addition, the application of the proved reserves replacement ratio in new bidding processes will help state to address long-life reserves to production ratio and sustainability of country's energy supply.
On the other hand, the definition of a tax royalty based on financial performance will address a window range of multiple simultaneous scenarios in which the profits of government and companies concur to equitable financial performance of 50%. This provides a more reasonable timeline for companies to deploy investment and help the state and contractors to arrive to a fair distribution of oil rents.
The incorporation of special tax regimes and rates, as well as, a preferential royalty in new oil contracts will push companies to look new ways to apply technology in mature fields (multilateral wells, modern completion systems and enhanced recovery processes) so as to probable and possible reserves, as well as, contingent resources might be converted into proved reserves. The index of Proved Reserves Evolution and the Ratio of Proved Reserves Replacement would be useful to account for these movements.
