Thu, 11 May 2000

Conoco builds offshore gas production unit

JAKARTA (JP): When Conoco needed flexibility to move fast to develop several large natural gas discoveries in the West Natuna Sea, it developed a completely new technology that provides considerable operational efficiencies and cost savings.

The solution to capture the clean-burning fuel is a technological marvel: a movable offshore gas production unit, or MOgPU, for use in Indonesia's Block B fields.

Conoco will be able to relocate the unit at a relatively small cost as older reserves are depleted and new fields are brought onstream. Construction on the MOgPU began in Korea earlier this year and production will begin in mid-2001.

The MOgPU was created after Conoco led negotiations to bring about the first export sale of pipelined gas from Indonesia to another country -- in this case Singapore. Last January, workers began laying a new, 300-mile subsea pipeline to Singapore, which when completed will be the longest natural gas supply and delivery system in Asia-Pacific.

"Conoco plans to make Southeast Asia a major area of operations for our company by building a multi-billion dollar business in the region by 2003," said Archie Dunham, Conoco's chairman and CEO in a press release.

"In 1999, Conoco made five discoveries offshore Indonesia that doubled our Indonesian gas reserves. We have produced oil in Indonesia since 1979, so we knew that to economically capture the gas and deliver it to the growing Asian market would require us to truly think creatively and develop new solutions," Dunham said.

"The biggest advantage of the MOgPU is mobility," said John Hopkins, Conoco vice president for exploration production technology.

"Basically, we can pick it up off the seabed and quite easily move it to another location and ultimately it can be abandoned with minimal effort and cost," Hopkins said.

Traditionally, offshore platforms require heavy construction equipment with large barges and cranes for installation, plus extensive hook-up and commissioning efforts.

"The MOgPU can be built onshore where labor and other costs are cheaper than assembling it in water. Then it can be towed offshore and is almost immediately ready to go. In fact, the same vessels that tow it out can be used to position and install the platform," Hopkins added.

Once this new steel gravity platform reaches its destination, it will be floated off its transportation vessel to essentially become a barge capable of floating on its own buoyancy. To lock it in place, the MOgPU utilizes a set of very simple cable strand jacks that lower the base structure and pull the platform up on the legs. The jack-up system can be rented, then returned, providing significant cost savings over traditional heavy construction equipment and barges.

Another advantage of the MOgPU is the elimination of motion problems usually associated with comparable floating facilities.

"Barges are subject to waves and movement, and traditional floating platforms need expensive flexible risers," Hopkins explained. "Since the MOgPU is a fixed platform, we eliminate both motion and the need to employ expensive risers and mooring systems."

Along with that stability comes another advantage: when the unit is installed, it can continue normal operations in 100-year storms with waves of up to 30-feet high.

"The MOgPU concept proves that once the market opens up, Conoco can move quickly to deliver energy to customers," said Rob McKee, Conoco executive vice president for worldwide exploration and production.

"The West Natuna Group has signed a 22-year sales contract with Pertamina to sell gas to Singapore. Conoco is poised for similar growth in other Asian markets in the near future," said McKee.