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Economics of steam-assisted gravity drainage for the Nigerian Bitumen deposit

Authors
Journal
Journal of Petroleum Science and Engineering
0920-4105
Publisher
Elsevier
Volume
116
Identifiers
DOI: 10.1016/j.petrol.2014.02.013
Keywords
  • Bitumen
  • Sagd
  • Economics
  • In Situ Recovery
  • Nigeria
  • Heavy Oil
Disciplines
  • Economics

Abstract

Abstract Combining deterministic and probabilistic procedures, the economics and commerciality of steam-assisted gravity drainage (SAGD) for exploiting the Nigerian heavy-oil sands are investigated. Considering net present value (NPV) and value–investment ratio as the objective functions, the impacts of reservoir performance, costs, oil price and fiscal regime are evaluated. Within the range examined, reservoir performance, oil price, and expenditure profiles are found to be the primary determinants of project value and risks. For the case studied, SAGD has more than 75% chance of economic success (NPV>0), suggesting its attractiveness for the Nigerian bitumen deposit. However, potential risks are highlighted, and mitigation measures prescribed.

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