Billion-kroner research aims to increase Danish oil extraction

At the Hydrocarbon Research and Technology Centre at the Technical University of Denmark (DTU), Director Bo Cerup-Simonsen and his team of 20 researchers from all over the world have embarked on a ten-year project with a clearly-defined mission: to develop new knowledge, new methods and new technologies that can increase and extend the production of oil and gas from the Danish North Sea. Initially, they will concentrate on the large limestone fields Dan, Halfdan and Kraka.

The Centre opened in September 2014 with a DKK 1bn grant from Dansk Undergrunds Consortium (DUC), whose members are A.P. Moller – Maersk, Shell, Chevron and the state-owned Danish North Sea Fund. The goal is to involve a further 100 researchers at DTU and other universities in Denmark and abroad.

Much of the research will be based on the vast quantities of data and the extensive experience DUC has compiled since the Dan-field first began producing oil in 1972 and which the consortium is now making available for research purposes.

“We've been given an opportunity to build our work on a giant platform of knowledge, data and ideas collected over many years of work in the fields,” explains Dr Cerup-Simonsen, who has ample experience bridging the gap between the world of science and the world of business. Prior to joining the Centre, he headed up Maersk Maritime Technology, which designed and developed the technology for the world's most efficient container vessel, the Triple-E.

Limestone: a hard nut to crack

One of the challenges of producing oil in the Danish North Sea sector lies in the fact that much of the oil has to be recovered from dense limestone layers. This makes the oil more difficult to recover than in the Norwegian or the UK underground, where oil deposits are trapped in sandstone formations.
Current recovery rates are about 26% in the Danish sector, 41% in the Norwegian and 46% in the UK sector. In other words, more than 70% of the proven reserves in the Danish oil fields is left in the ground.

In order to secure a future for oil production in Denmark, it will be necessary to develop new recovery technologies.

“The experts and our main stakeholders all agree that it makes perfect sense for our research centre to target the limestone deposits first, seeing that Denmark already produces so much oil from that source. It's what you'd call a no brainer,” says Dr Cerup-Simonsen about the centre's major focal point and its first flagship project.

Yet, he declines to set a specific target for how much recovery rates can be boosted.

“Right now, we're trying to map the potential of raising recovery rates and how to realise that potential. Perhaps we can talk about volumes and recovery rates at a later date, but it's much too early for that just yet,” he says.

It is estimated that each percentage point the recovery rate is raised by represents oil revenue of about DKK 50bn.

Research in many different fields

At the Centre, engineers, geologists, geophysicists, chemical scientists, physicists and materials research scientists are busy with four main areas: reservoir characterisation, Enhanced Oil Recovery, drilling and well technologies, and facilities and materials.

Reservoir characterisation is about gaining an understanding of subsea geology and of how oil and gas is trapped in these underground layers. The more knowledge and the better the researchers understand the underground geology and conditions of the Danish North Sea, the better the chance of the industry selecting the best production technology.

Enhanced Oil Recovery is a technique used to free oil and gas from limestone formations by adding soap or water with a certain saline or bacterial content to allow the oil to better flow towards the wells. The technique used is vital in the work to increase the recovery rate.

The researchers working on drilling and well technologies are exploring the best and cheapest ways for the industry to establish new wells and maintain existing ones. Digital solutions and systematic use of data play key roles because digitalisation allows operators to manage wells and optimise production from a distant location.

“There is already a lot of new technology out there, but we strongly expect that innovative sensor and analysis technologies may help to lower operating costs in the future,” says Dr Cerup-Simonsen.

The last of the four research fields is facilities and materials, e.g. pipelines and platforms. This is a vast area covering everything from extending useful product lifecycles to reducing operating costs and start-up costs for new platforms and pipelines.

The general objective of the Centre is to develop solutions that will increase the recovery of oil and gas in the Danish North Sea sector. An important aspect of this, according to Dr Cerup-Simonsen, is to develop technologies that can lower costs significantly.

“It is very important to explore whether new technologies can radically reduce cost levels. That alone would increase the production of oil and gas from the North Sea, as it would move the marginal breakeven point at which income equals cost.”

Price of oil must not dictate research

The plunge in oil prices has not gone unnoticed. The Centre collaborates closely with the industry, and the low oil price has triggered redundancies and a firm commitment to cutting costs. However, the price of oil will not be allowed to dictate activities at the Centre:

“It is important for us to maintain a long-term perspective; otherwise we’re not a research institution. That said, however, we fully understand the situation the industry is in at the moment, and we hope we can help solve some of these problems through some relatively simple research activities,” says Dr Cerup-Simonsen.

“It’s fine to start with finding out whether we have a few ideas on hand that we could launch in the short term. The ten-year horizon doesn't necessarily apply to all of our projects.”

This is a translation of the Danish article published in Hav & Kaj 2, 2015.