Gurdip Singh, Contributing Editor
Seismic survey activities in the Asia-Pacific are peaking and geophysical companies are expected to set up pre-concession bidding data libraries, and introduce more 4D shoots and more intensive deepwater subsurface surveys using the wide-azimuth towed-streamer acquisition technology that is widely used in the Gulf of Mexico.
The Asian market has made progress as most of the region’s major hydrocarbon provinces are seeing renewed efforts in subsurface data collection to meet growing demand in the region and to fully develop indigenous energy resources.
“We see a good level of activity as most oil companies are intensifying their collection of pre-drilling data and prospect assessments,” says Cameron Astill, executive vice president of the Asia-Pacific region for CGGVeritas.
India, Australia, and Vietnam are hot spots for shooting 3D seismic surveys, and today’s state-of-the-art processing systems are providing a good number of leads for spudding wells.
With the current price of crude oil close to $100/bbl, international oil companies (IOCs) and National Oil Companies (NOCs) are focusing on building strong geological databases.
Astill believes that multi-client data library collection is more valuable today, given the urgency for oil companies to reduce the time of the exploration phase, especially in light of the growing gap between depleting resources and new discoveries.
The availability of data libraries would reduce the usual year-long wait for the delivery of proprietary seismic survey results, he points out.
This helps reduce the time to discovery, stresses Astill, adding that data libraries are becoming more and more important as early data availability accelerates hydrocarbon exploration.
But the geophysical services and equipment industry is short of resources, and the industry is investing.
CGGVeritas alone added two new vessels last year to bring its global fleet to 20, including seven currently operating in Asian waters.
The industry is expected to add more vessels from 2009-2010. CGGVeritas plans to add two more seismic vessels in this period, and has exclusive design rights with Norwegian ship designers Ulstein Group for the SX-120 X-Bow design. Ulstein says this will be the world’s most advanced and lowest environmental impact vessel, with many features for improving data quality, reducing the impact surveys have on the environment, providing a comfortable, safe, and healthy working environment, and increasing the efficiency and effectiveness of towed-streamer operations. Under the terms of the agreement with Ulstein Design AS and the ship owner, Eidesvik AS, further SX-120 vessels are planned to be ordered for delivery after 2010, in a program designed to update the CGGVeritas global fleet.
An artist’s impression of CGGVeritas’ Ulstein design X-Bow 120.
Astill sees more of the larger seismic vessels operating in Asian waters in the future, some up to 120 m (394 ft) long. These vessels have more stability to carry more deck-based equipment, and to create fewer disturbances to the towed streamers. It is also expected that the region will see more and more deployment of 10-streamer vessels.
Data processing technology has improved significantly, helping to generate more prospects than the industry could define a decade ago. More and more companies are using direct hydrocarbon indication (DHI) surveys, which help to pinpoint leads and to reduce the high cost of leasing rigs, equipment, and services, especially for deepwater exploration.
CGGVeritas is expected to increase its global research and development expenditure in the coming years, from the current 3% of revenue. The company’s chairman and CEO Robert Brunck, already has announced plans to double Asia-Pacific’s R&D expenditure to $30 million over the next two years.
“Given the renewed and re-energized exploration activities by the oil companies, we believe the seismic market in Asia-Pacific will see double-digit growth in 2008 and 2009,” Brunck estimates. CGGVeritas projected that the overall seismic market grew 20% in 2007.
There is little reason for a slow down in Asian exploration activities, as the region is becoming a leading energy consumer. Every Asian country’s agenda is to increase production of indigenous hydrocarbon resources.
Seismic research vesselAlize acquiring data in India.
Asia-Pacific marine activities are expected to increase 15-20% based on the projected increase in the size of the seismic fleet in Asian waters. “We believe the industry is now operating about 25 to 27 vessels in the region, and we expect 30 or more vessels to be operating when new vessels are launched over the next two years,” Astill says.
The industry faces the challenge of territorial disputes, especially in the South China Sea, though a number of bilateral and trilateral treaties have been signed to continue the search for hydrocarbon resources through joint ventures between Asian NOCs and IOCs.
Some models have worked well, including the Malaysia-Thailand Joint Development Area, a major gas-producing basin overlapping the Malaysian and Thai territorial waters in the Gulf of Thailand.
But some disputes and multi-party claims over acreage have resulted in cancellation of geophysical contracts, according to Astill, though these are the global challenges and risks that businesses would face in any environment.
Astill outlined the main hotspots for shooting seismic surveys:
India has been active for the past six years. This momentum will be maintained, given the success of the New Exploration Licensing Policy, which leases out oil and gas prospecting acreages. Oil and Natural Gas Corp., along with home-grown Reliance Energy and the IOCs, are keeping up the pace with new seismic surveys. Some 65,000 sq km (25,097 sq mi) of 3D seismic survey were acquired in Indian waters in the last six years, while another 35,000 sq km (13,514 sq mi) will be acquired over the next three years. CGGVeritas has committed three seismic survey vessels to the Indian offshore acreage, and adds a fourth vessel at peak activity times.
Overall, Astill is bullish about India, especially following the recent discoveries in the east coast waters, though he sees the presence of subsurface basalt flows as a major impediment to acquiring surveys on the west coast, off the Mumbai High fields.
But India is ready to take on new technology and is planning to apply surveying techniques such as ocean-bottom cable and wide-azimuth towed-streamer configurations.
India also could see more 4D seismic surveys, an evaluation tool that allows field operators to survey the reservoir at six-month or yearly intervals to examine reservoir attributes, fluid flow, and to optimize production.
Australian companies, led by the Woodside Petroleum Group and Chevron, as well as ConocoPhillips and BHP Petroleum, always try new technologies. They have been conducting 4D surveys, beginning first in Indonesia a few years ago.
The Australians are gung-ho to develop their hydrocarbon resources and have lined up a number of natural gas reservoirs for development. “We see Australia as a very active market and it will continue to be for a good number of years,” Astill says.
Timor Leste and Papua New Guinea also are seen as being active, together with the Australian segment of the market, while New Zealand is moving into new frontier acreages. One of the main areas for 2D and 3D surveys is New Zealand’s southern basins. CGGVeritas is seeing increasing activity in these regions of the Pacific, according to Astill.
Work in Southeast Asia is also increasing. Indonesia is resuming seismic surveys after a lull since about 2005. “We see a four-fold increase in the Indonesian seismic survey activities,” Astill says.
He expects geophysical companies to shoot 6,000-8,000 sq km (2,317-3,089 sq mi) of offshore 3D data this year, up from 5,000 sq km (1,931 sq mi) last year and from about 2,000 sq km (772 sq mi) in 2006. IOCs are stepping up efforts to help increase crude oil production in Indonesia, which has dropped to about 1 MMb/d from the high of 1.3 MMb/d about 10 years ago. The Indonesian government has put pressure on national, local, and international oil companies to increase exploration activities to reduce the rising cost of importing petroleum products to meet domestic demand.
Vietnam has intensified exploration activities in its offshore basins and CGGVeritas says it has about 70% of the market share. The company has two vessels in Vietnamese waters and is set to add more.
Vietnam and Indonesia are set to upgrade their seismic surveys using the latest technologies, especially the 4D surveys and multi-azimuth technology.
“We are ready to deploy 10-streamer vessels to provide the best images of the subsurface,” Astill says, acknowledging that the geophysical industry would become more competitive with more and more companies tendering for work in Asia-Pacific.
In China, the geophysical industry is led by the NOC’s, especially the China National Offshore Oil Corp. CGGVeritas supports the Chinese market through equipment supplies and services.
Though Malaysian oil companies have moved into the exploration drilling phase, having completed major seismic data gathering campaigns last year, the heavyweights in the country are taking another look at their concessions and reservoirs. The Royal Dutch Shell group continues assessing its reserves around Borneo, both in Malaysia and Brunei.
The Petronas-led Malaysian market is expected to require 4D and multi-azimuth technologies for its deepwater surveys in the coming years.
“The market is challenging and the political environment is good, albeit with some disputed territories,” Astill says, highlighting the challenge of working on still unknown subsurface areas with fractured basement reservoirs and shallow gas clouds.
Cameron Astill, executive vice president Asia-Pacific Region (right) with chairman and CEO Robert Brunck (center) briefing Singapore’s Minister of State for Trade and Industry Lee Yi Shyan (left) at the new CGGVeritas Asia-Pacific headquarters in Singapore.
But CGGVeritas is committed to the technology to resolve these challenges in the region. The company has invested $55 million in a regional headquarters in Singapore, which will have double-digit staff growth going forward. It is 220 employees strong in Singapore, which manages the region, and has country offices in major hydrocarbon-endowed regions, including China and India.
