Optimal Extraction Path in a Oil and Gas Broun Field Under the Buyback Contractual Framework (Case Study on the Iranian Oil Field in the Persian Gulf)

,; ,; ,; ,; , Said moha

doi:10.18869/acadpub.jemr.6.24.41

Volume 7, Issue 24 (6-2016) jemr 2016, 7(24): 41-82 | Back to browse issues page

‎ 10.18869/acadpub.jemr.6.24.41

‎ 20.1001.1.22286454.1395.6.24.7.6

Mendeley

Zotero

RefWorks

Optimal Extraction Path in a Oil and Gas Broun Field Under the Buyback Contractual Framework (Case Study on the Iranian Oil Field in the Persian Gulf). jemr 2016; 7 (24) :41-82
URL: http://jemr.khu.ac.ir/article-1-1426-en.html

Optimal Extraction Path in a Oil and Gas Broun Field Under the Buyback Contractual Framework (Case Study on the Iranian Oil Field in the Persian Gulf)

Abstract: (6253 Views)

The subject of this article is determining the oil optimal production path in one of the Iranian oil and gas brown field in Persian gulf, while the development of the field performed under the buyback contractual framework. In this research we have optimized a dynamic equation using numerically Bellman equation in Matlab program .We have considered different and possible oil price projections and discount rate scenarios. We have compared the differences between optimal production path and actual (and contractual) profiles. The results show that optimal production path is different from operator actual profile in both high and low discount rate (respectively 20% and 1%). Although contractual production profile and optimal production path for alternative discount rate is harmonization, However, Production profile bids by contractor matching with the calculated optimum production model in option of a high discount rate, in the early period, is Verified the expected behavior of international oil companies. But its incompatibility with actual performance the field indicates a incompatibility between the production plan bids by the contractor with the field real possibilities.

Keywords: Optimal Oil Production Path, Risk Service Contracts, Iranian Buyback Contract

Full-Text [PDF 2626 kb] (3779 Downloads)

Type of Study: توسعه ای | Subject: انرژی، منابع و محیط زیست
Received: 2016/06/5 | Accepted: 2016/07/19 | Published: 2016/09/19

References

1.  Adelman, M.A(1986),"Oil Producing Countries' Discount Rates" Department of Economics &Energy ,M.I.T. Energy Laboratory Working paper,-EL 86-015WP,Cambridge

2.  Adelman, M.A(1993).,"Modelling World Oil Supply", The Energy Journal 14(1) ,p 1-32.

3.  Bellman, R(1957),"Dynamic programming",Princeton University Press.

4.  Boykett.Tim ,Marta Peirano,Simone Boria,Heather Kelley,Elisabeth Schimana,(2012),"Oil Contracts How to Read and Understand a Petroleum Contract", ed. Version 1.1,Times Up Press

5.  Chakravorty U , Roumasset J and Tse K (1997)," Endogenous Substitution among Energy Resources and Global Warming", Jornal of political Economy 105(6),1201-1234 [DOI:10.1086/516390]

6.  Dehgani, Toraj.(2014), "Investment and financing oil and gas projects" (Vol. I), the Institute for International Energy Studies, Tehran.

7.  Derakhshan, Masoud.(2014) "oil contracts from the perspective of protecting and EOR production approach resistance economy", Journal of Islamic Economics , Volume 6, Issue 12, Spring and Summer 1393 Page 7 of 52

8.  Dongkun. Luo and Zhao Xu,(2013)," Modeling optimal oil production paths under risk service contracts" , China Univercity of Petroleum(Bijing) and Springer,Verlag Berlin Heidelberg.

9.  Estrada. Javier (2007),"Discount Rates in Emerging Markets: Four Models and an Application, Journal of Applied Corporate Finance", Volume 19 Number 2, IESE Business School, Morgan Stanley Publication.

10.  Gao Weiyu, Peter R. Hartley, Robin C. Sickles(2009)," Optimal Dynamic Production from a Large Oil Field in Saudi Arabia" ,springer.

11.  Ghandi, Abbas - C.-Y. Cynthia Lin(2013),"an Analysis of Risk and Rate of Return to International Oil Companies in Iran's Buy-Back Service Contracts", Institute of Transportation Studies,University of California at Davis, United States,February 5 2013

12.  Ghandi. Abbas ,. C.-Y. Cynthia – Lin(2013)," Oil and Gas Service Contracts around the World: A Review", Institute of Transportation Studies,University of California at Davis, United States.

13.  Ghandi. Abbas and C.-Y. Cynthia Lin,(2011)," Do Iran's Buy-Back Service Contracts Lead to Optimal Production? The Case of Soroosh and Nowrooz", Institute of Transportation Studies,University of California at Davis, United States.

14.  Ghorbani Pashakolaie,Vahid, Morteza Khorsandi , Teymor Mohammadi , Shahla Khaleghi , Abbas Shakeri , Seyed Taghi Abtahi Foroshan (2014),"Modeling Optimal Oil Extraction using Optimal Control Model: A Case Study of an Iranian Oil Field ", Journal of Iran's energy Economics, Issue 13, winter 2014, pp 189-220.

15.  Hotelling, h. (1931), "the economic of exhaustible resources", ,journal of political economy, 39 (2).

16.  International Energy Agency[IEA](2015)."World Energy Outlook 2015". Paris,France ,publication on the WEB at: www. iea.org.

17.  Leighty,Wayne and,C.Y.Cynthia Lin (2012)," Tax policy can change the production path: A model of optimal oil extraction in Alaska", Energy Policy,41 , p 759-774 .

18.  Ministry of Petroleum,(2014)," New Model Iran Petroleum Contract (IPC)", Oil Contracts Restructuring Committee, Tehran February, 2014

19.  Mohammadi, Tymor, Monirah Motamedi (2010)," Dynamic Optimization of Oil Production in IRAN (Case Study: HAFT-GEL Oil Field)",Economic Research Review Fall 2010 Volume 10 , Number 3 (38); Page(s) 235 To 265.

20.  Motiei, H. (2010), "An Introduction to Zagros Petroleum reservoir evaluation(for geologists)" Volume II, First Edition, Arian Zamin, Tehran.

21.  Nystad ,A.N(1985), " Reservoir Economic Optimization", chr. Michelsen inst. SPE 13775

22.  Powell, S.(1990). "The Target Capacity-Utilization Model of OPEC and The Dynamic of The World Oil Market",The Energey Journal Vol.11, pp.27-61.

23.  Ramcharran, H. (2002)." Oil production responses to price changes: an empirical application of

24.  Technology Cooperation Presidential Office (2006), "Final Report research project to study the conventional models for financing in the upstream oil and gas sector", Tehran.

25. ♣ the competitive model to OPEC and non-OPEC countries", Energy Economics, 24 (2), 97-106. [DOI:10.1016/S0140-9883(01)00091-3]

26.  Van Groenendaal Willem and Mohammad Mazraati(2006),"A critical review of Iran's buyback contracts",Energy Policy 34, 3709–3718. [DOI:10.1016/j.enpol.2005.08.011]