As Oil India braces for a COVID-19 fuelled downslide in demand resulting in a sharp dip in output, its drilling operations seem to have come to a standstill.
The management is considering ‘killing wells’ to avoid producing too much.
A well kill is the operation of placing a column of heavy fluid into a well bore in order to prevent the flow of reservoir fluids without the need for pressure control equipment at the surface.
It works on the principle that the hydrostatic head of the ‘kill fluid’ or ‘kill mud’ will be enough to suppress the pressure of the formation fluids.
Well kills may be planned in the case of advanced interventions such as workovers, or be contingency operations.
The situation calling for a well kill will dictate the method to be adopted.
But Oil India engineers are worried because most of the company’s productive wells are very old and may not be easy to revive after a ‘well kill’.
“If we have to kill wells, there’s a slim chance of reviving them,” one Oil India engineer told Northeast Now on condition of anonymity.
He said Oil India has suspended drilling at 15 of 18 exploration and development wells across the Northeast due to huge staff shortages caused by the lockdown and most staff confined to homespace.
Due to the coronavirus pandemic, service providers are unable to deliver components or supplies to remote well-sites.
Only three wells are being drilled – two at Lakwagaon (in the Moran PML) and one at Baghjan.
Workover operations are also continuing at a fourth well.
By March 23, Oil India was producing approximately 8400 t/d (61,600 b/d) across the Northeast.
But the Oil India engineer said there will be sharp drop from that level post-COVID-19.
At present rates, Oil India managers say production has dropped to 2.2m t/y from 3.32m t/y (as per its 2018-19 report).
Blamed for the sharp decline are problems at the refineries which offtake Oil India’s crude, in particular Numaligarh Refinery, which takes around 1m t/y.
“NRL is telling us its tankage (for refined products) will be full any day,” said the Oil India engineer, adding the company expects further ‘demand shocks’ as industrial activity slumps.
Oil India headquarters in Duliajan is in lockdown and so too are most field operations, with only skeletal staff on sites.
“Safety is our primary concern,” the engineer told Northeast Now.
“Most of our people are working from home with many projects postponed,” the engineer added.
Local Oil India managers in Assam say they expect the situation to worsen as the COVID-19 spreads and refineries faced with reduced industrial activity and overflowing product inventory start refusing crude.
“If NRL’s tankage problems continue because of no industrial demand, we may be forced to start killing our wells,” said the Oil India engineer, but expressing ‘deep fears’ that the wells may be difficult to revive later because they are too old.
Other than the Numaligarh refinery, Oil India also supplies crude to refineries at Guwahati, Digboi and Bongaigaon.