DRILLING MARKETS
the depths of each hole section. Mr Al
Darkazly also noted possible disputes if the
casing is tagged at different depths than
the BHA, or if directional work deviates
from the plan.

Petronas’ review of cost models also
revealed several potential areas of
improvement for IDS contracts that Mr
Al Darkazly said could help minimize dis-
putes between operators and contractors.

For one, by refining the risk-sharing
mechanism in IDS contracts, operators
can establish clearer responsibilities and
expectations for contractors, minimizing
disputes and creating an environment
where risks are effectively managed and
shared. A potential approach is to transfer the
risk fully to the contractor, which may
result in an increase in the contract cost.

However, this ensures that the operator’s
spend is closely aligned with the bud-
get. For example, if the drilling contractor
bears the cost of mud losses or left-in-hole
BHA, that can help mitigate financial risk
for the operator. Another strategy may be
to share the risk with the contractor based
on a calculated percentage, taking into
account the probability of encountering
issues downhole.

Another way to minimize potential
disputes may be to avoid specifying the
number of rigs in an IDS contract, Mr
Al Darkazly said. This is beneficial from
the operator’s perspective as it allows
for the potential provision of additional
rigs when needed to expedite drilling
activity or overcome contractor-related
delays, ensuring adherence to the delivery
schedule. Thirdly, under the per hole section
model, true vertical depth (TVD) is gener-
ally specified for each hole section with
a safety margin. However, conflicts may
arise in cases where the total depth criteria
are modified by the reservoir geologist to
drill a deeper TVD. To address this issue,
Mr Al Darkazly suggested two potential
mitigations. First, the safety margin of
TVD can be increased based on field expe-
rience, resulting in a higher cost estimate
that can accommodate potential chang-
es. Alternatively, a cost line item can be
included in the contract for each addi-
tional meter drilled beyond the specified
TVD depth, ensuring that any deviations
from the original plan are accounted for
and appropriately compensated.

Also, to prevent disputes and ensure
compliance with established standards,
IDS contracts should include explicit pro-
visions addressing contractor practices
that deviate from the operator’s practic-
es. These practices may include reduc-
ing mud quantity, operating with minimal
manpower, employing inexperienced per-
sonnel and other non-compliant actions.

By incorporating comprehensive details
and emphasizing adherence to the opera-
tor’s practices, Mr Al Darkazly said, opera-
tors can set clear expectations.

“We have a competitive bidding process,
and we’re awarding the contract to the
lowest bidder, so we’re aware that some-
times the contractor must make decisions
to save costs on their end, but we need to
ensure that we are clear about our stan-
dards,” he said. DC
“Insulated pipe,”
continued from page 38
An average MWD temperature of 164°F
was seen while drilling, which FORGE
and Eavor attributed to the positioning of
non-insulated pipe near the BHA. Further,
it was observed that the average MWD
temperature rose to 220°F while drilling in
the next run, when no IDP was used. The
formation reached a maximum tempera-
ture of 450°F throughout all runs.

After the IDP was pulled and inspected
onsite, Eavor noted that the external coat-
ing showed negligible wear from the trial.

There was minor damage to the internal
coating on a small number of joints, but no
damage was found on the MWD tool or the
drill bit nozzles.

“This learning cycle of finding out how
the pipe behaves can be done in the lab,
but it’s really hard to compete with field
deployment. What we’ve seen with our
testing so far is that the thermal out-
put, and the performance of the pipe, is
matching our expectations,” Mr Vetsak
said. He also noted the impact of the IDP in
protecting the MWD tools overall. In a
previous run without using IDP, one of the
MWD batteries – rated for up to 300°F –
failed at a recorded temperature of 327°F.

This was because the BHA faced height-
ened vulnerability during the process of
tripping in the hole and at the beginning
of drilling a new section due to a lack of
circulation. This lack of circulation could
lead to the column warming up close to
the temperature of the surrounding for-
mation. While running in hole, the BHA encoun-
ters hot fluid, and without adequate cir-
culation it can warm up quickly, requir-
ing frequent pauses to circulate and cool
down the BHA. If the cool-downs are not
performed in time, the BHA is at risk of
exceeding its maximum design tempera-
tures. As the IDP reduces heat transfer
between the hot annulus and the cold fluid
in the drill pipe, the risk of exceeding the
BHA maximum temperatures is reduced.

During the two runs utilizing the IDP, Eavor
and Forge reported no failures of the MWD
tools. DC
In May 2023, the IDP was put to the
test again, this time as part of the US
Department of Energy’s FORGE project at
the University of Utah. Eavor provided 350
joints of internally and externally coated
IDP for two bit runs, with the aim to
demonstrate the technology’s capacity to
reduce BHA temperatures, reduce tem-
perature-related equipment failures and
observe any potential drilling performance
improvement. In the first run, a full string of the IDP
was utilized, along with a new motor;
a mud chiller was also brought online
toward the end of the run, decreasing
the inlet temperatures from approximately
130°F to 110°F. An average MWD tempera-
ture of 149°F was seen while drilling, a
reduction of 31° compared with the previ-
ous run in the well.

In the second run, a partial IDP string
was used, with approximately 70% IDP
and 30% regular non-insulated drill pipe.

40 JAN UARY/FEB RUARY 2024 • D R I LLI N G CO N T R ACTO R