Success Story of Joint Operation in Overlapping Areas Between Two Operators to Maximize Potential Revenue and Cost Optimization in Sanga Sanga Block, East Kalimantan, Indonesia

Abstract In Sanga Sanga Block, there are two different contractors which have several overlapping areas. The overlapping areas are limited by depth rights. The development of these areas will bring out an expensive cost because each contractor will develop the area stand alone. In other hand, collaboration between contractors will maximize the economics of development and led to an efficient operation thru synergy of drilling, production and commercial. To maximize the potential hydrocarbon in overlapping areas, several synergies have been applied. They were: Integrated technical engineering:Subsurface static and dynamic integration between operators to identify area of interest and hydrocarbon targets from shallow to deeper reservoirs.Optimize well and completion design by using dual-monobore and artificial lift design by using gas lift or pumps.Integration of existing production facility for surface facilities. Joint Operation Agreement: A bilateral agreement. It outlines terms and intents of the collaboration. Preparation for execution of joint drilling and production activities in the forms of procurement and permits. Performance quantification monitoring Cost benefit analysis was used to compare stand-alone and synergy operations in overlapping areas. Based on the integrated subsurface evaluation, 3 areas of interest were identified for drilling and production synergies. Well design & completion are converted from conventional to dual monobore and artificial lift can use pumps and gas lift. The two operators agreed to sign joint agreement and implement the 1st phase of synergy work plans which covers 21 development wells and work over of existing wells. The benefits of these synergy initiatives are: potential revenue of US$ 245 MM, cost optimization of US$ 98 MM and production acceleration. Despite the operational challenges, the benefits above have been delivered safely and excellent risk assessment and implementation of operational procedures. The novelty of this new operating model is the ability to complete synergy in drilling, production operations and commercial. This synergy is the first method application in Indonesia and become a benchmark for other contractors who have similar issue in overlapping area.