Drilling Cycle Time: More Controllable Than You Think
June 19, 2019

Drilling represents one of the highest investment costs in hydrocarbon extraction. It is also arguably the highest risk activity in the entire upstream value chain, given that poor execution can affect safety, cost, return on investment, reserve depletion and the success of subsequent operations (e.g., Completions).   A poorly executed wellbore may remain a problem child for 30+ years!

So our hydrocarbon value chain is dependent upon a high cost, high-risk activity, but there is constant pressure to reduce cost (and risk), mainly in the desire to execute more quickly, thus compressing Drilling cycle time (a proxy for cost).

This desire drives an inherent conflict between QUALITY and SPEED. We could deliver smoother, better, and less risky wells if we were just able to slow down, but that increases cost…

We at Audre Partners are very familiar with this conflict. We are also familiar with the majority of the conflict’s symptoms and how they manifest themselves. A key sign is a seeming need to explain cycle-time variability and execution issues away with phrases like “every well is different…” and “it’s the geology…”

When we at Audere Partners begin to hear these and other similar lines of thought, we know that there is work to be done in terms of bringing the operator to a place where they understand the differences between controllable and uncontrollable cycle-time variation. Every well IS different, but while design specifics and geology play a significant part in cycle-time variability, the majority falls under the category of ‘controllable.’ Thus, for the most part, Drilling cycle-time and cost is in the hands of the operator. You CAN do better…

Controllable Variables

Let’s assume for a second that the Drilling function has its hands tied when it comes to some of the more obviously significant variables. These include area and formation, pad type and drill sequence. Often, decisions about these variables fall to functions outside drilling (or are treated as a given by the corporation as a whole). Let’s not dwell on them here. Suffice to say that a well-run drilling program with low incident rates, low cycle times, low costs and high levels of trust can use that trust to gain a seat at the table when decisions like these are being made. So how do we make our program flawless? We can start by concentrating on the remaining, more ‘mundane’ variables.

The Drilling function will usually have control over rigs and equipment, maintenance, spares, crews, crew management, and crew supervision. Think of these as the field based variables, and you can add to the list yourself. The function also controls office based variables such as Engineering assignments and workload, planning and execution standards, design review processes, data integrity, short interval control of performance, learning processes, design experimentation, and comparative metrics.

All of these variables represent potential differences in behaviors and the level of discipline/execution rigor that is ‘normal’ in the organization. Herein lie many opportunities for optimization and standardization across the fleet and the associated oversight teams.

It is our experience that a purposeful attack on controllable sources of cycle-time variation can yield considerable changes in program results (think 25%-30% step change) without investing a single dime in new technology or capital.

Regardless of differences in geology, there should always be consistency in the application of processes and procedures with supervisory oversight;  regular oversight will provide best-case scenarios. It is only through uniformity and standardization that we can get closer to a world where the geology is the base variable around which we have a tool kit of processes, procedures, and review to address whatever comes up.

Our typical experience is that a performance gap costing millions of dollars can usually be corrected during an implementation lasting 6 to 9 months, but functional leaders often shy away from such programs because they can’t conceive of the fact that changing behaviors changes outcomes.

Is that what you believe? Talk to Audere Partners and let us show you how we can Turn Your Potential Into Reality.

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