Monday, March 6, 2017
Dallas, TX
1:45–3:00 p.m.
RISK FACTORS AFFECTING CONTROL OF WELL
AND SPECIAL INSURANCE ENDORSEMENTS TO MITIGATE THE RISKS
Presented by
Brian Krause
Bill Mahler
Well Control Specialist
J.H. Blades & Co. Inc.
Executive Vice President & General Manager
Wild Well Control, Inc.
Maintainingcontrolofthewellintoday’soilandgasdrillingenvironmentcanpresentanumberofrisks.Thissessionwillidentifytheprimaryriskfactorsthataffect
controlofthewell.Inaddition,theconsequencesandassociatedcostsofhavinga
wellcontroleventwillbediscussed.Thesessionwillreviewmitigationactionsthat
canbeimplementedthroughspecialendorsementstocontrolofwellpolicies.
Copyright © 2017 International Risk Management
Institute, Inc.
www.IRMI.com
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Brian Krause
Well Control Specialist
J.H. Blades & Co. Inc.
BrianKrauseisaveteranintheoilandgaswellcontrolandfirefightingworld.Hebeganhis
wellcontrolcareerasanapprenticetofamedAmericanoilwellfirefighterRedAdair,where
heeventuallybecamevicepresidentinAdair’scompany.Laterheledthefirefightingteam
thatcontrolledsixsabotagedwellsatthestartoftheGulfWar,andmostrecently,hespentsix
yearsasvicepresidentofTravelersOilandGas.
Mr.Krausespentnearlythreedecadesonactiveassignmentthroughouttheworldcontrolling
blowouts.FollowingAdair’sretirementin1993,heandotherformerAdaircolleagueswent
ontoformtheirowncompany,IWC/Boots&Coots.Mr.Krausewaspresidentandseniorwell
controlspecialistofIWC/Boots&Cootsfromits1995startuntil2003.
Bill Mahler
Executive Vice President & General Manager
Wild Well Control, Inc.
BillMahleristheexecutivevicepresidentandgeneralmanagerforWildWellControl,Inc.,a
Houston,Texas-basedcompanyspecializinginworldwidefirefighting;wellcontrol;andrelatedengineering,marineengineering,andtrainingservices.Mr.Mahlerhasover33yearsin
theoilfieldserviceindustry.Hisexperienceencompassesoperations,businessdevelopment,
salesandmarketing,strategicplanning,marketanalysis,andacquisitions.
Mr.Mahler’sexperiencehasbeenintheoilfieldserviceindustry,specificallytherentaltool
anddownholeservicesector,withadirectfocusonprovidingsupportservicestothehydraulicworkover(snubbing),coiledtubing,andwellcontroloperations.
Mr.Mahlerreceivedhis bachelorofbusiness administrationdegree infinancefromTexas
A&MUniversity.HeisalsoamemberoftheSocietyofPetroleumEngineers,InternationalAssociationofDrillingContractors,andAmericanAssociationofDrillingEngineers.
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Risk Factors Affecting
Control of Well and the
Use of Special Insurance
Endorsements to Mitigate Same
Bill Mahler
Executive VP
Wild Well Control, Inc.
Brian Krause
Well Control Specialist
J.H. Blades
#IRMI2017
#IRMI2017
There are certain inherent risks associated with the drilling and
workover operations regarding Control of Well. There are many risk
factors involved and a majority of them can be assessed, then
minimized, mitigated or eliminated.
This presentation will identify the primary risk factors and some of the
things that can be done to mitigate these new risks.
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Purpose of Presentation
This presentation is to enhance your –
• Awareness of Control of Well Risks
• Awareness of the Consequences of a Well Control Event
• Awareness of Possible Mitigation Actions Available through Insurance
Endorsements
This presentation will answer the following questions • What are the primary risk factors affecting Control of Well?
• What are the consequences and associated costs of having a well control event?
• What can be done to minimize the number of claims and to minimize the size of a
claim when a well control event does occur?
#IRMI2017
Who is Wild Well Control?
We are the world’s leading provider of emergency
firefighting, well control and related engineering,
training and environmental management services.
Our unique services are provided for domestic and
international O&G Operators, both onshore and
offshore.
We are the only Company in our industry
that is ISO 9001, 14001 & 18001 certified.
We are a wholly owned subsidiary of
Superior Energy Services (NYSE –SPN).
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What Is A Well Control Emergency?
The most catastrophic
occurrence during well site
operations is a blowout.
A blowout is an uncontrolled
flow of reservoir fluids from
the wellbore to the earth’s
surface.
The blowout may, or may
not, result in a fire.
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When Can A Blowout Occur?
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During Drilling Operations
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During Workover Operations
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During Production Operations
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During Completion Operations
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Due to Deteriorated Surface Equipment
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Blowouts Can Occur Offshore
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And, Blowouts Can Occur In Storage /
Disposal Wells
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Blowouts Do Not “Just Happen”
• Documented facts show that over 80% of major catastrophes involve
a chain of 7-11 separate contributing factors (or warning signs)
before a catastrophe occurs.
Blowouts Are NO Different!
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The Risk Factors
There are two types of risk factors in the drilling of oil and gas wells.
• First, you have those risk factors associated with the mechanics of
drilling an oil / gas well.
• Second, you have those risk factors associated with the human
performance during the drilling of an oil / gas well.
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Risk Factors Associated with
the Mechanics of Drilling a Well
• Reservoir Characteristics – HPHT? BHP? H2S?
• Well Location
• Shallow Gas Formations
•
•
•
•
Casing Design
Cementing Program
Rig Design
Rig Well Control System
• Blowout Preventers
• Accumulator System
• Choke & Manifold Design
• Drilling Operations
• Stuck Pipe
• Loss Circulation
• Kicks
• Completion Operations
• Frac Operation
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Risk Factors Associated with the Human
Performance
The Rig Crew • What is the Rig Crew’s experience level?
• What is Rig Crew’s level of Well Control Training
• Does Tool Pusher and Driller have current well control certification?
• Others on Rig Crew understand basics of Well Control?
• What is the Rig Crew’s Safety Culture and Attitude
• Is the Rig Crew prepared for a well control emergency?
• Are they conducting scheduled Kick Drills effectively?
• Are they complacent to the ongoing drilling operation?
• How will the Rig Crew react to a high stress event?
• Must react quickly and decisively to a kick.
• Will the Rig Crew know what to do?
The Rig Crew is the First Line of Defense in
Preventing / Handling Well Control Incidents
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CONTINUED RISKS IN TODAYS
DRILLING OPERATIONS
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Leading Control of Well Risk Factors –
Drilling / Production Operations
• Multiple Well Pads
• Complex Multiple Stage Frac Operations
• Continuous Multiple Well Frac Operations
• Suburban Settings for Drilling / Production Activities
• Simultaneous Operations at the Wellsite
• Aging Field/Well Integrity Issues
• Environmental Issues
• Uptick in Drilling Activities
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Multiple Well Pads
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Complex Multi Stage Frac Operations
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Continuous Multi Well Frac Operations
Additional Risk Exposure vs Cost Savings
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Suburban Settings for
Drilling / Production Activities
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Simultaneous Operations at the Well Site
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Aging Field / Well Integrity Issues
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Environmental Issues
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Uptick in Drilling Activities
• Rig Conditions
• Rig Personnel Availability
& Experience Level
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RISK MITIGATION & MANAGEMENT TOOLS
FOR USE IN WELL PLANNING AND
DURING DRILLING OPERATIONS
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Risk Mitigation / Management Tools – Well
Planning
• Risk Assessment
Assessment of the probability of
the risk and the severity of the
consequences.
• Well Plan
• Well Location
• Drilling Rig
• Environmental
• Regulatory
• Political
• Assessment of Consequences
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Risk Mitigation / Management Tools – Well
Planning
Emergency Response Plan or Blowout Contingency
Plan
• Provides a Response Methodology
• Identifies Response Organization
• Eliminates unnecessary Delays
• Identifies Resource Requirements
• Identifies Potential Problems
• Increases the Efficiency and
Cost Effectiveness of a Response
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Risk Mitigation / Management Tools – Well
Planning
Modeling of
Kick Tolerance
By Hole Section
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Risk Mitigation / Management Tools – Well
Planning
Pressure Simulation
Graphics
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Risk Mitigation / Management Tools – Well
Planning
Dispersion Modeling
Dispersion Modeling can
identify potential problem
areas for evacuation should an
uncontrolled flow occur.
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Risk Mitigation / Management Tools – Well
Planning
Relief Well
Target Well
Combined (TW + RW) Positional Uncertainty Ellipsoid
By-Pass: drill past the TW uncertainty
ellipsoid, range to locate TW & plugback
for re-direction and ultimate TW intersect
Relief Well Planning and
Modeling - Pre-Drill
Cross-By: drill and range on the TW,
without By-Pass/plugback for ultimate
TW intersect
Determines if one relief well or more
may be required should the subsea
well blowout during drilling
operations.
Normal Drilling
Interval
Drill to Initial
Ranging Interval
Initial Ranging &
Triangulation Cross-By
Interval
close approach point
Locate Target Well
By-Pass
uncertainty ellipsoid
reduction after ranging
Parallel
Interval
Final Alignment
Interval
Intersection Point
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for definition purposes only
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Monitor Target
Well Path
Prepare for
Intersection
Risk Mitigation / Management Tools – Well
Planning
Plume Analysis
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Risk Mitigation / Management Tools – Well
Planning
Erosion Modeling
Of Production Equipment
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Risk Mitigation / Management Tools – Drilling Ops
Rig Site Kick Drills
• Evaluates the readiness of the rig
crew & their response skills.
• Measures the crew’s response to
a well control kick.
• Rig crews gain an understanding
of importance of their duties to
daily operations and emergency
response situations.
#IRMI2017
Risk Mitigation / Management Tools – Drilling Ops
Well Control Equipment Audits
• Assists in the effort to eliminate or
reduce those risks associated with
well control.
• Includes a comprehensive visual
inspection of the well control
equipment once it has been rigged
up and tested after casing is set.
• Based on established and accepted
industry practices
• Areas of concern identified &
communicated to the client
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Risk Mitigation / Management Tools – Other
Well Integrity Audits
• Audits condition of surface
equipment – trees, manifolds,
pipelines, etc – to identify
unforeseen risks.
• Can be used on existing properties
or on properties being considered
for acquisition or merger.
• Visual inspection of Surface
Equipment as to working condition.
• Report prepared and concerns are
ranked as to the highest risk
concerns.
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Risk Mitigation / Management Tools – Other
Well Control Training
• Introductory Well Control Training
• Well Control Training
• Advanced Well Control Training
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Risk Mitigation / Management Tools – Other
Environmental Assessments
• Audit of Well Pads
• Visual Inspection of Production
Equipment
• Development of Environmental
Impact Statements identifying areas
of concern – wetlands, streams,
water sources, etc.
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Risk Mitigation / Management Tools – Other
Insurance Endorsements & Programs
Designed to –
• Reduce the probability / number of well control events
(and the number of Control of Well claims)
• Reduce the severity of a well control event should one occur
(and the dollar size of the Control of Well claims)
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Special Control of Well Insurance
Endorsements
• Kick Assistance Program
• Pollution Mitigation and Elimination Program
• Provides Oversight of environmental response during a well control event /
response
• Well Control Training
• Emergency Response Plan
• Technical Support during Drilling Ops
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Consequences of a Well Control Event
•
•
•
•
•
•
Injuries to Rig / Company Personnel
Loss of Assets – Rig, Well, Reservoir
Environmental Damages
Civil Claims
Shareholders’ Equity
Regulatory Fines and Penalties
Porter Ranch, CA
2016
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Increased Risk Profiles for Oil & Gas
Operations in Today’s Market
DRILLING OPERATIONS
• Returning of Rigs to the Field - Condition?
• Hiring of Rig Personnel - Experience?
• Restricted Budgets for Well Control Training - Trained?
• Complacency in Drilling Shale plays - Alert? Prepared?
OTHER OIL & GAS OPERATIONS
• Storage Well Systems
• Disposal Wells
#IRMI2017
The Rig Crew is the First Line of Defense in
Preventing / Handling Well Control Incidents
They must be –
• Experienced and competent in well control
• Prepared for a well control event
• Alert throughout the drilling of the well
• Able to make decisions without hesitation
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Thank You!
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