NOC Subsurface Organization Transformation to Boost Its Resource Base and Secure Country's Energy Needs

Abstract

UkrGasVydobuvannya (UGV) is an E&P organization of the National Oil Company (NOC) of Ukraine – Naftogaz Group. UGV's existing gas fields represent one of the largest reservoir portfolios in the Eastern Europe; however, the current depletion level of the company's fields is also among the highest; the bulk of the fields have depletion levels between 70 and 90%. The E&P Company (UGV) has created a resource base development strategy to plan and deliver exploration activities and reservoir management based on industry best practices to maintain and grow the company's production and bookable reserves for years to come. The subsurface transformation program (including both exploration and reservoir management domains) addresses the actions taken to ensure success for the Strategy. Actions consider not only increase in exploration acreage or acquiring new fields and prospects, but also the organizational, cultural, technological and process level changes across the subsurface domain in the company. The program is still in the early implementation phase; however, the first material results are confirming the validity of the program: Organization re-design per industry standards: asset development teams were established and aligned with the portfolio priorities; Digital database of subsurface data is being created and systemic reservoir surveillance is being executed; Growth source secured: Black Sea, new onshore unconventional and conventional licenses; Modern exploration practices, including risk-based probabilistic exploration drilling decisions and launching of Petroleum Systems Analysis and Basin modeling; Reshaping the obsolete rigid structure of the research institute into a modern R&D center; and, Professional development program tailored to build-up the modern skills and competencies of company's subsurface teams. These and other important steps of the transformation will ultimately help the company to ensure a healthy reserves replacement ratio and increase the production share of greenfields in its portfolio. This case study can serve as a blueprint for any medium-sized subsurface organization (especially in NOCs) that faces similar resource base challenges and wishes to improve its production performance.