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Request for Proposal 
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2004 11 24
Drilling Seasonal Load Levelling Business Case
Expression of Interest Deep Blue Project Performer Presentation PDF (99 KB)
Drilling Seasonal Load Leveling Business Case Project PDF (17 KB)
Project
PTAC Petroleum Technology Alliance Canada, Alberta Department of Energy, BC Ministry of Energy and Mines, the Canadian Association of Drilling Engineers, the Canadian Association of Oilwell Drilling Contractors, the Canadian Petroleum Safety Council, and the Petroleum Services Association of Canada invite you to respond as a potential supporter, participant or supplier for the subject RFP. If you believe that this project would be of value to your organization, please fill out the attached expression of interest form and return it as soon as possible, but no later than January 14, 2005. This RFP has been formulated under the direction of the PTAC Drilling Innovators Advisory Group (DIAG). Development of a business case for the seasonal load leveling of drilling activity has been identified by the DIAG as the top drilling priority for the Western Canadian oil and gas industry.
Background
Drilling activity in Western Canada typically peaks in the first quarter of each year at 2 to 3 times the activity levels experienced during the summer. This is result of a number of factors including winter access only areas, corporate annual budget cycles that provide new capital funds starting in January, producer asset team timing and the habit of simply doing things "the same old way". This results in a number of undesirable outcomes including drilling costs that are up to 35% higher than necessary, human resource challenges for the service sector, increased fatalities and accidents, less than optimal rig fleet and associated services annual utilization and overall higher finding and development costs for the industry. This situation was well documented with recommendations in a June 2003 study entitled, "Western Canada Drilling Cycle Optimization" www.psac.ca/initiatives/pdf/ziff-energy-drilling-optimization-report.pdf. This RFP has been formulated to follow up on several of the recommendations in the subject study. A number of producer companies have recently been successful in reducing their winter drilling activity and spreading that activity out more evenly throughout the year. The benefits have included significantly lower drilling costs, an improved learning curve with service personnel and improved safety performance.
Purpose and Objectives
The purpose of this RFP is to formulate, fund and complete a project that will provide a business case study and companion presentation for reducing winter drilling activity and spreading that that activity out more evenly throughout the year. The study and presentation will be made available for education of industry executives, financial analysts, asset team members and others who influence the timing of drilling in their companies or across the industry. The study must be sufficiently detailed so that the aforementioned people will change how they approach their business and cause a measurable favourable impact on drilling costs, safety performance, human resources, rig utilization and finding and development costs.
Scope
The study will include actual comparable drilling cost data for both summer and winter operations for the main drilling areas and depths in the WCSB. As well, a summary of a limited number of technologies, innovations and practices to seasonally load level drilling activity will be included. Comparable safety-related statistics or information will also be included wherever possible. Producers or other project participants who are willing to provide such information in confidence to the project performer are critical to the success of the project. The study will not attribute the source of such information to protect the respective interests of such participants.
PTAC, with financial and technical support from industry and government, intends to utilize the following process to launch this project as outlined in the subject RFP:
- Issue RFP to potential supporters, participants and suppliers by December 1, 2004.
- Determine potential supporters, participants and suppliers for the study through the returned Expression of Interest forms. Deadline: January 14, 2005.
- Facilitate meeting with potential supporters and DIAG members to review RFP response and determine if there is sufficient potential support and participants to proceed no later than January 19, 2005.
- If there is sufficient support to proceed, then request proposals immediately from potential suppliers.
- Provide a meeting date to all potential supporters, participants and suppliers of the RFP for proposal presentations by February 14, 2005. At this meeting, potential supporters will select a preferred proposal, identify upgrades needed and an optimal process to move forward. We encourage suppliers that can meet a portion of the need outlined in the RFP to make integrated proposals with appropriate co-suppliers.
- Finalization of project work scope is expected in February 2005.
- Finalization of commitments/study launch is expected no later than March 2005.
- The RFP and related non-proprietary information on project status will be available on PTAC's web site at www.ptac.org or office (403)-218-7702.
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