An overview of Kuwait oil & gas industry and the application of solar enhanced oil recovery to help the country achieve its 2020 crude oil production target.

1. Enhanced Oil Recovery - Kuwait
Prepared by: Alahdal A. Hussein
March 29, 2015
Proposal number: 2
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2. PROPOSAL CONTENT
1- Overview about Kuwait Petroleum Industry 3
2- Kuwait Oil Production Target 3
3- Enhanced Oil Recovery 4
4- Thermal Enhanced Oil Recovery 6
5- EOR Projects in Kuwait 7
6- Solar - Enhanced Oil Recovery 8
7- Advantages of Solar EOR 9
8- Cost Comparison of Producing Steam by Natural Gas and Solar EOR 10
9- Solar EOR companies in Kuwait 10
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3. 1. Overview about Kuwait Petroleum Industry
According to the Organization of Petroleum Exporting Countries (OPEC) Annual Statistic
Bulletin 2014, Kuwait had an estimated 101.5 billion barrels of proved oil reserves. The
country also holds additional reserves in the Partitioned Neutral Zone (PNZ) between
Kuwait and Saudi Arabia, where Kuwait shares a 50-50 basis with Saudi Arabia. The PNZ
holds about 5 billions of proved oil reserves and this brings Kuwait's oil reserves to 104.5
billion barrels. Kuwait has the sixth highest proved oil reserves among all countries with
6% of the world total proved oil reserves. Its oil reserves include approximately 13 billion
barrels of heavy oil, located primarily in northern Kuwait, with other reserves concentrated
in the PNZ. Kuwait is also a member of OPEC and exports the fifth largest volume of
crude oil and condensates following Saudi Arabia, the United Arab Emirates, Iraq, and
Nigeria. The country's current oil production output ranged from 2.9 to 3 million barrels a
day. Regardless of the high oil production the country had, it has plans to increase its oil
production outputs by 2020 and 2030.
2. Kuwait Oil Production Target
Kuwait's short-term strategic plan is to produce 3.150 million barrels of oil daily through
the years 2015 and 2016 according to Kuwait Petroleum Company's CEO Hashim S.
Hashim. In addition the country's long term strategic plan is to remain one of the world's
top oil producers as the country targets crude oil and condensate production of 4 million
barrels per day (bbl/d) by 2020 and it is projected that the production capacity would be
maintained through 2030. Therefore Kuwait intends to upgrade its production and export
infrastructure, expand exploration, and build downstream facilities, both domestically and
abroad. This effort is expected to help Kuwait achieves its oil production output's target for
2020.
On the other hand, much of Kuwait's reserves and production are concentrated in a few
mature oil fields discovered in the 1930s and 1950s. The Greater Burgan oil field, which
comprises the Burgan, Magwa, and Ahmadi reservoirs, makes up the main portion of both
reserves and production. Those fields are mature fields, which raises the need to focus the
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4. country's effort on the deployment of enhanced oil recovery methods to help boost
production and achieve the country's production output's target.
3. Enhanced Oil Recovery
Enhanced oil recovery (EOR) is a set of
techniques used by oil producers
throughout the world to increase the rate
and total amount of oil production. By
injecting steam, chemicals or gas into a
reservoir, EOR can increase production
rates and total production many-fold
compared to traditional primary and
secondary recovery methods.
Primary recovery occurs earlier in a field's
life where oil is driven to production simply
through pressure changes with the
formation, fluid and production well causing
the expansion of gas in oil solution, forcing
the oil to the producing well. Secondary
recovery processes are required when a
reservoir becomes low in energy, where
considerable oil (usually lighter in gravity)
has been produced without fluid
replacement in the reservoir leaving a low
pressure that cannot naturally drive oil
towards production. In these cases water
flooding or gas injection (immiscible with oil)
are techniques implemented through
injection wells to increase pressure and
displace hydrocarbons to production.
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5. Tertiary recovery, also known as enhanced
oil recovery (EOR) is commonly used in
mature fields where secondary techniques
such as water flooding no longer produce
economically viable quantities of oil and
start to exploit large quantities of the
injected water. EOR methods inject
specific fluids into the subsurface which
can be highly viscous to improve
hydrocarbon sweep efficiency, or can alter
the properties of the oil and even the rock
in some cases (wettability in carbonate
reservoirs) to improve the flow of oil and
increase production. The type of fluid
injected largely depends on the
characteristics of the oil (API gravity) and
rock itself. The most renowned EOR
methods used to improve oil recovery
factors in fields worldwide are: Thermal
injection (steam/fire flooding), miscible gas
injection (CO2) and polymer injection.
EOR methods have responsibility for the
largest oil recovery out of the 3 stages.
After primary and secondary recovery the
average reservoir still contains around
70% of its original oil in place3, meaning
EOR methods can sometimes extract just
over half the total original reserves in
place. EOR methods are extremely costly
and the decision to push forward with
tertiary recovery largely depends on the
economic climate (oil price), which has
been the main factor in the past why many large oil companies have decided to freeze
production on fields rather than go forwards with EOR.
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6. 4. Thermal Enhanced Oil Recovery
Thermal recovery techniques are the most understood and technologically advanced
methods of EOR in the industry today, controlling approximately half of the total enhanced
oil recovery worldwide. Thermal methods are commonly used when dealing with heavy
viscous oils with API gravity less than 20 degrees and viscosities between 100-10000
centipoise, resulting in a very low mobility fluid that is difficult to produce. Thermal injection
supply's heat down well into the reservoir, which increases the oil temperature causing
partial vaporization or expansion of the fluid (oil) leading to a reduction in its viscosity,
therefore improving its ability to flow towards production.
Thermal Enhanced Oil Recovery System
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7. 5. EOR Projects in Kuwait
In a plan to boost production, international oil companies (IOCs) were allowed involvement
through Enhanced Technical Service Agreements (ETSA) to assist Kuwait in enhanced oil
recovery (EOR) of its mature fields. Below are some of the EOR projects in Kuwait:
1- The Greater Burgan oil field: this field comprises of the Burgan, Magwa, and Ahmadi
reservoirs, and this field makes up the main portion of both reserves and production.
Greater Burgan's capacity largely from the Wara reservoir through enhanced oil recovery
methods such as seawater and carbon dioxide injection.
2- Umm Gudair, Minagish, and Abduliyah fields: According to MEES, Kuwait plans to
continue employing EOR techniques in the fields to maintain output of 500,000 bbl/d.
3- Raudhatain and neighboring Sabriyah fields: In August 2010, British company Petrofac
signed a deal with KOC to boost production capacity in those fields.
4- Wafra oil field: A full-field steam injection EOR project led by Chevron is under
development to offset field declines and boost production of the heavy oil play by more
than 80,000 bbl/d during the first phase.
Oil and Gas Fields Map in Kuwait
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8. 6. Solar - Enhanced Oil Recovery
Thermal EOR requires very large amounts of thermal energy. Large amounts of fuel are
needed to generate steam for EOR projects. Solar EOR replaces fuel use with solar
energy. In Solar EOR method, mirrors are used to reflect and concentrate sunlight onto
receivers that collect solar energy and then convert it to heat. The heat is then used to
produce steam from water. Solar EOR can generate the same quality and temperature of
steam as natural gas. Therefore, the use of solar EOR could reduce demand for natural
gas required for EOR, which can be redirected to other economic activities, such as power
generation, water desalination and as feedstock and energy for industrial processes.
Solar Enhanced Oil Recovery
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9. 7. Advantages of Solar EOR
Solar EOR is likely to play an important role in the mix of EOR technologies. Instead of
burning natural gas to produce steam, solar EOR involves the use of concentrating solar
power (CSP) technology to produce steam. There are many advantages of using Solar
EOR such as:
1- Solar EOR reduces EOR fuel costs and helps operators hedge against fuel price
volatility. Lower, stable costs for steam improve the economics of oil production.
2- Maximization of natural gas value, in many oil-producing countries, a shortage of natural
gas puts EOR operations in direct competition with industrial development and other
economic needs.
3- Local economic development, solar EOR can reduce the gas usage of EOR projects by
up to 80%. This gas can be applied to other industries, such as electricity generation,
desalination or even export as LNG, boosting total economic activity.
4- Creation of job opportunities, deployment of Sola EOR in Kuwait will provide a powerful
economic stimulus that is poised to create thousands of jobs across kuwait. By replacing
natural gas with solar energy for steam generation, Kuwait can redirect scarce natural gas
resources to the private sector for use in industrial development and job creation.
Redirecting more than 80 per cent of current gas resources used for EOR to private
industry could fuel up to 280,000 new jobs throughout the country.
5- Solar EOR helps to recover more oil, solar steam generators are simple and reliable,
eliminating 60% of the operating cost of a thermal EOR operation. Once installed, solar
steam generators deliver steam for 30 years at very low operating costs. This low-cost
long-term steam supply extends the life of existing wells, allowing economic production
further down the decline curve. With an optimized solar steaming strategy, more oil can be
economically recovered throughout the field’s lifetime.
5- Solar EOR solution produces emissions-free steam, eliminating all nitrogen oxides
(NOx), particulate emissions, and CO2 associated with fuel combustion. Emission-free
steam lowers operators’ risk to carbon legislation and can sidestep permitting constraints,
enabling producers to expand production amidst increasingly strict regulatory hurdles.
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10. 8. Cost Comparison of Producing Steam by Natural Gas and Solar EOR
Despite experiencing fuel supply shortages, many countries in the Gulf have multi-tiered
and subsidized fuel costs, which do not reflect the true economic value. To expand heavy
oil production, these countries will need to import LNG at $13 per MMBtu, not only to fuel
EOR projects, but also for power generation and industrialization. Kuwait is currently
natural gas net importer, that means using natural gas for its EOR is costly and according
to U.S. Department of Energy, the price cost of producing steam is $8/MMBtu, however
due to the cost of transportation, it is expected that the price of producing steam in EOR
using natural gas is $13 per MMBtu.
In the other, according to GlassPoint- one of the leading companies in Solar-EOR in
middle east - the price of producing steam using Solar system is about $3/MMBtu. This
represent a huge difference in price between using natural gas and Solar-EOR.
Consequently, deployment of Solar systems in thermal EOR in Kuwait will benefit the
country economically and environmentally.
9. Solar EOR companies in Kuwait
The Solar-EOR industry in Kuwait is still at its beginning. The first specialized Solar-EOR
company in Kuwait is GlassPoint Solar, the leader in solar enhanced oil recovery (EOR).
GlassPoint Solar established its new office in Kuwait city on March 2014 and has
appointed Mr. Abdul Hussain Shehab as Country Chairman. The second company os
eSolar - California-based CSP developer - which is planning to enter the Solar-EOR in
Kuwait. More information is needed in this field especially about the local companies and
the recent international companies joined the Solar-EOR in Kuwait.
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