The Economics of EOR Schemes in the UK Continental Shelf (UKCS)

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5 Citations (Scopus)

Abstract

Enhanced oil recovery (EOR) schemes have been slow to evolve in the exploitation of hydrocarbons from the UK Continental Shelf. They are generally much expensive to execute offshore than in on shore USA where they are relatively common. This paper provides a detailed analysis of the economic aspects of several EOR projects namely low salinity waterflood, polymer flood, and miscible gas injection. Detailed economic modelling of example schemes finds that, in current circumstances in the UKCS, prospective returns, while worthwhile in undiscounted cash flow terms, are only very modest at discount rates reflecting the cost of capital. It is also noted that there are several significant investment risks. Further tax incentives relating to the purchase of polymer and miscible gas could enhance returns to these EOR projects without introducing any distortions.
Original languageEnglish
Title of host publicationSociety of Petroleum Engineers conference papers
PublisherSociety of Petroleum Engineers
Pages1-12
Number of pages12
DOIs
Publication statusPublished - Sep 2015

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Keywords

  • Enhanced oil recovery schemes
  • financial simulation modelling
  • discount rates
  • tax allowances, sensitivity analysis
  • UKCS
  • North Sea oil
  • Petroleum Economics

Cite this

Kemp, A., & Stephen, L. (2015). The Economics of EOR Schemes in the UK Continental Shelf (UKCS). In Society of Petroleum Engineers conference papers (pp. 1-12). [SPE-175470-MS] Society of Petroleum Engineers. https://doi.org/10.2118/175470-MS