Current Journal of Applied Science and Technology

40(11): 97-116, 2021; Article no.CJAST.66708

ISSN: 2457-1024
(Past name: British Journal of Applied Science & Technology, Past ISSN: 2231-0843,
NLM ID: 101664541)

Comparison of Three Artificial Lift Operations in the

Niger Delta
Chinedu I. Ndubuka1* and Julius U. Akpabio1
1
Department of Chemical and Petroleum Engineering, University of Uyo, Uyo, Nigeria.

Authors’ contributions

This work was carried out in collaboration between both authors. Author CIN designed the study,
wrote the first draft of the manuscript and designed the reservoir modeling and simulation processes.
Author JUA checked the whole manuscript and analyzed the economic aspect of the design and the
oil price. Both authors read and approved the final manuscript.

Article Information

DOI: 10.9734/CJAST/2021/v40i1131375
Editor(s):
(1) Dr. Chien-Jen Wang, National University of Tainan, Taiwan.
Reviewers:
(1) Rasoul Khandan, University of Northampton, UK.
(2) Yashik Singh, University of Kwazulu-Natal, South Africa.
(3) Alvaro Torres Islas, Universidad Autónoma del Estado de Morelos, México.
Complete Peer review History: http://www.sdiarticle4.com/review-history/66708

Received 20 February 2021

Accepted 27 April 2021
Original Research Article
Published 29 May 2021

ABSTRACT

More than 70% of oil-producing wells require some form of artificial lift to increase the flow of fluids
from subsurface to the surface when a reservoir no longer has sufficient energy to
produce at economic rates. This situation has been observed in the Niger Delta oil wells over the
past years and has caused the abandonment of reservoirs with a significant volume of
hydrocarbon. Data from two oil wells that could not flow naturally to the surface have been
obtained from an oil company operating in the Niger Delta. The arm of this study is to optimize the
production of two oil wells using an artificial lift system. To increase production and extend the life of
these wells, artificial lift projects were considered. This was done with the aid of Integrated
Production Modelling (IPM) tool in Petroleum Expert suite. Two wells were simulated using the
obtained data, and their production performances were evaluated. The well’s
production outputs were optimized using artificial lift systems, that is electric submersible pump
(ESP), hydraulic pump (HP), and gas lift (GL). The results obtained showed that the
ESP wells have the highest oil production rate compared to GL and HP respectively. An economic
analysis was carried out using Net Present Value (NPV), Profitability Index (PI) and Internal Rate of
Return (IRR). In terms of economic comparison, ESP is the most viable project
_____________________________________________________________________________________________________

*Corresponding author: E-mail: [email protected];

 Ndubuka and Akpabio; CJAST, 40(11): 97-116, 2021; Article no.CJAST.66708

with the highest NPV, PI and IRR Hence, the ESP technology proved to be the best technology for
sustaining a high production rate, increasing revenue and proved to be economically viable in Niger
Delta oil fields.

Keywords: Artificial lift; gas lift; hydraulic pump; electric submersible pump; economic indicator.

1. BACKGROUND OF THE STUDY and selecting of the ESP system mainly depends
on accurate data especially that pertaining to the
Hydrocarbons will normally flow to the surface well’s capacity, if the given data is not accurate
under natural flow when the discovery well is then the design will usually be marginal and lead
completed in a virgin reservoir. The fluid to premature failure [4]. It accounts for over 60%
production resulting from reservoir development of artificial lift methods used globally and
will normally lead to a reduction in the reservoir contributes significantly to the CAPEX and OPEX
pressure, an increase in the fraction of water of a project. They tend to be the least reliable
being produced together with a corresponding component in the system with an average
decrease in the produced gas fraction. All these lifespan of 2 years [5]. It is also a key artificial-lift
factors reduce or may even stop the flow of fluids technology to the petroleum industry. Worldwide
from the well. The remedy is to include within the installations of ESPs are in the range of 130,000
well completion some form of artificial lift. An units, contributing to approximately 60% of the
artificial lift system (gas lift or pumping system) total worldwide oil production [6]. Key to
must supplement the energy supplied by the achieving the production gains was candidate
reservoir in order to produce fluid at the surface. selection and well testing to confirm the well
The precise amount of energy needed is productivity and aquifer pressure support. This
represented by the vertical separation between process also mitigated risk by selecting wells
the two curves. Artificial lift systems are designed from a reservoir sector with a historical low
to help natural reservoir energy to flow formation incidence of asphaltenes and GORs, which have
fluids to the surface at targeted rates [1]. They not spiked substantially above solution GOR.
are employed when reservoirs do not have Once the ESPs were installed, the production
enough energy to naturally produce oil or gas to gains were achieved by correctly managing
the surface or at the desired economic rates. drawdown through real-time surveillance, which
Most often associated with mature fields, this was also used to manage the stress on the ESP
energy shortfall typically occurs when the and avoid infant mortality. Longer term run lives
reservoir pressure has been depleted through were achieved by selecting the correct ESP
production. materials and completion architecture for the well
conditions [7]. Croce and Pereyra [8] evaluated
Pumping solutions, such as artificial lift methods, the impact of the effective viscosity of the
have been used in the oil industry for more than emulsions on the head and flow rate delivered by
100 years. The selection and application of each the ESP. Walter et al., 2020, developed a
of these options depends on its advantages and troubleshooting manual that could be used for
particularities related to the production scenarios any engineer to identify likely conditions that
considered. Currently, the most often applied could be affecting negatively ESP performance
artificial lift technologies are sucker rod pumping and to implement solutions to minimize failure or
(SRP), hydraulic jet pumping (HJP), progressive damage beyond repair in ESP equipment. Gas
cavity pumping (PCP), ESP, hydraulic lift as a method of artificial lift has been used in
submersible pumping, and hydraulic piston the industry for over 100 years, there were many
pumping (HPP) [2-3] stated challenges abound advances in gas lift system design during the
for operators attempting to deploy artificial lift development of the systems from the early
systems in unconventional applications. As rudimentary designs [9]. But optimizing gas lift
always, operators set a variety of challenging systems with existing technology is typically time
business and operational goals for themselves: consuming, costly, and risky. Frequent well
minimize capital and operational expenditures; interventions are required with associated lost
maximize drawdown over the well’s life; and and/or deferred production.
minimize downtime, failure frequency, and
intervention frequency. (ESP) is one of the most 2. ELECTRICAL SUBMERSIBLE PUMP
efficient artificial lift methods used in the oil
industry for lifting moderate to high volume of ESP systems consist of both surface
fluids from wellbores to surface, proper sizing components (housed in the production facility, for

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example, an oil platform) and sub-surface need for compressors, pipelines or a separate
components (found in the well hole). Surface source of natural gas.
components include the motor controller (often a
variable speed controller), surface cables and Gas lift system is first designed by calculating the
transformers. Subsurface components typically production potential of each well in the network.
include the pump, motor, seal and cables. The Then based on available gas pressure and
pump itself is a multi-stage unit with the number volume, each well, its optimum production and
of stages being determined by the operating gas lift allocation is designed. An ideal gas lift
requirements. system is one in which gas is injected into the
fluid column at a continuous rate and at a
2.1 Hydraulic Pump constant pressure. This process ensures that a
stable liquid flow rate from reservoir and is
Hydraulic pumps are used in hydraulic drive possible only in fields in which sufficient volumes
systems and can be hydrostatic or of high-pressure gas are available and liquids
hydrodynamic. A hydraulic pump is a mechanical can flow easily through the formation into the
source of power that converts mechanical power wellbore. Engineers must also construct wells to
into hydraulic energy (hydrostatic energy i.e. accommodate the type of injection system to be
flow, pressure). It generates flow with enough used. Gas may be injected into the fluid column
power to overcome pressure induced by the load through an open system that has no seal
at the pump outlet. When a hydraulic pump between the tubing and the casing annulus or
operates, it creates a vacuum at the pump inlet, uses a standing valve in the tubing to isolate the
which forces liquid from the reservoir into the casing annulus from the production tubing.
inlet line to the pump and by mechanical action However, the most common gas lift configuration
delivers this liquid to the pump outlet and forces includes a packer and gas lift valves.
it into the hydraulic system. Hydrostatic pumps Designing a gas lift system that optimizes
are positive displacement pumps while production is a complex challenge. Engineers
hydrodynamic pumps can be fixed displacement must account for the interaction system; the
pumps, in which the displacement (flow through potential, constrains and needs of each well must
the pump per rotation of the pump) cannot be be considered individually along with those of the
adjusted, or variable displacement pumps, which network as a whole. Flowline and downhole
have a more complicated construction that allows tubular sizes lengths, processing equipment, gas
the displacement to be adjusted. Although, and compressor availability, fluid composition
hydrodynamic pumps are more frequent in day- and other factors impact gas lift efficiency and
to-day life. production Gas lift is a recovery process that
involves the use of gases, produced from oil or
2.2 Gas Lift purchased. There are two types of gas lift,
namely, intermittent gas lift and continuous gas
Gas lift systems aid or increase production by lift. The gas lift process involves the injection of
injecting high-pressure gas from the casing high-pressure gas at the bottom of the production
annulus into fluids that have entered the tubing of an oil well. In other words, gas lift
production tubing from the formation. The involves injecting high-pressured gas from the
function of this injected gas is to reduce the surface into the producing fluid column through
density and thus, reducing the hydrostatic one or more subsurface valves set at
pressure of the fluid, thereby allowing in in situ predetermined depths. This helps to improve
reservoir pressure to lift the lightened liquids. The recovery by reducing the bottom-hole pressure at
technical applicability and economic viability of which wells become uneconomic, resulting in
gas lift installations are determined by two being abandoned. The gas, mixed with the oil,
factors: availability of gas and compression diminishes the weight of the fluid column thereby
costs. In the majority of gas lift wells, nearby reducing the downhole pressure. A low downhole
wells produce enough gas to supply the system, pressure induces a flux of fluids from the
and after the fluids have been lifted to the reservoir to the well. The produced fluid is
surface, the gas can be separated from the composed of oil, gas and water.
liquids and returned to the casing annulus to
maintain required gas volume and pressure. 3. METHODOLOGY
When circumstances permit, the industry also
uses natural, or auto, gas lift systems, which is This research used commercial software in the
highly cost effective because it eliminates the Integrated Production Modelling (IPM) suite-

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Production and Systems Performance Analysis After optimizing the wells’ outputs, an economic
(PROSPER), Material Balance (MBAL) and analyze was carried out to assess the viability of
General Allocation Package (GAP), [10]. Reliable the project. The economic indicators employed to
production data of two oil wells were obtained assess the profitability of this project are Net
from an oil company operating in the Niger Delta Present Value (NPV), Profitability Index (PI) and
Table 1. The two wells were simulated and the Internal Rate of Return (IRR).
production outputs were optimized using artificial
lift systems ESP, HP and GL. MBAL was used 3.1 Design of Artificial lift System
for reservoir modeling and description.
PROSPER was used to design the artificial lift The first step when modelling a new well in IPM
systems for the wells. GAP was used to integrate will be to fill out a system summary. The Black
the PROSPER and MBAL models for production Oil model with oil and water option will be used to
optimization Fig 1. The flow charts for the describe the fluid flow in the reservoir model. It is
operation of the software and the steps taken to also here that the choice of artificial lift or natural
achieve the aim and objectives of this project are flowing method was made. The next step was to
summaries in Figs 2 to 4. fill in the PVT data. The basic

Table 1. Collected fluid properties (FP) of two oil wells from field X

well 1 well 2
GOR 1000 scf/STB GOR 1200 scf/STB
API 40 API 40
Gas Gravity 0.8 Gas Gravity 0.8
Mole % of H2S 0 Mole % of H2S 0
Mole % of CO2 0 Mole % of CO2 0
Mole % of N2 0 Mole % of N2 0
Oil Density 41 lb/ft3 Oil Density 46 lb/ft3
Oil FVF 1.3 RB/STB Oil FVF 1.3 RB/STB
Oil Viscosity 0.6 Cp Oil Viscosity 0.6 Cp
Oil Compress 1/psi Oil Compress 1/psi
Gas Density 0.04 lb/ft3 Gas Density 0.8 lb/ft3
Gas Viscosity 0.3 Cp Gas Viscosity 0.2 Cp
Gas FVF 0.006 ft3/scf Gas FVF 0.008 ft3/scf
Water Density 65 lb/ft3 Water Density 64 lb/ft3
Water Viscosity 0.4 Cp Water Viscosity 0.4 Cp
Water FVF 1.0 RB/STB Water FVF 1.0 RB/STB
Water Salinity 80000 ppm Water Salinity 82000.9 ppm
Overall Heat 3 BTU/H/FT2/F Overall Heat 3BTU/H/FT2/F
Cp Oil 0.5 BTU/lb/F Cp Oil 0.5 BTU/lb/F
CP Gas 0.5 BTU/lb/F Cp Gas 0.5 BTU/lb/F
Reservoir Pressure 4500 psi Reservoir Pressure 5000 psi
Reservoir Temperature 183 degF Reservoir Temperature 205degF
Water cut 50% Water cut 40%
Reservoir Permeability 500 md Reservoir Permeability 600 md
Reservoir Thickness 200 ft Reservoir Thickness 200 ft
Drainage Area 250 acres Drainage Area 250 acres
Dietz Shape Factor 10 Dietz Shape Factor 10
Wellbore Radius 0.5 ft Wellbore Radius 0.5 ft
Skin 0 Skin 0
Porosity 0.27 Fraction Porosity 0.3 Fraction
Connate Water Sat 0.2 Fraction Connate Water Sat 0.2 Fraction
Original Oil in Place 2000 MMSTB Original Oil in Place 2000 MMSTB
Initial Gas Cap 0 Initial Gas Cap 0
Source: Field data (2021)

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Fig. 1. Typical wells model with GAP software

reservoir parameters such as initial reservoir where the PVT data were entered. The third
pressure (Pi), bubble point pressure (Pb), window is called the Inflow Performance
reservoir temperature (TR), gas–oil ratio (GOR), Relationship (IPR) data window where the IPR
oil formation volume factor (FVF), etc., were data were entered. The fourth is the equipment
inputted into the PROSPER software (PVT Data data were entered and the artificial lift (ESP, HP
Simulator) to history match the reservoir`s PVT or GL) was designed and simulated. The fifth
data. window is the analysis summary and also called
the results window. The six window is the IPM
3.2 ESP and HP Design licence window. Figs 5 and 6 represent the
performance curves of ESP and HP.
When modelling ESP and HP well with
PROSPER software, a number of parameters 3.4 Gas Lift Design
have to be entered into the system. The ESP
input data screen is divided into six windows. When modelling a gas lifted well, a number of
The first window is called the options summary parameters have to be entered into the system.
where the choice of artificial lift was made. The The gas available for lifting has the following
second window is called the PVT data window characteristics Tables 2and 3). The operating

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injection pressure was set to 1500 psi. Desired Also, maximum injection depth for the well was
differential pressure (dP) across valves, 200 psi, set at 7500 feet. The most used valve type is the
was entered to ensure well and gas injection casing sensitive, which was also chosen here.
system stability. Minimum spacing between Valve settings was selected to “Pvc = Gas
valves was set to 250 feet. Sea water was Pressure”. Then PROSPER sets valve dome
assumed as the load fluid before gas lift start, pressure to balance casing pressure at depth of
which result in a static gradient of 0.46 psi/ft. 7500 feet.

Fig. 2. Workflow for the operation of PROSPER software

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Fig. 3. Workflow for the operation of MBAL software

3.5 Economic Analysis wells, a thorough economic analysis was carried

out. It is the profitability of a project that has to be
In making a decision whether to invest in a the final decision criteria. However, the initial
project, the incremental cost to complete the costs of the scenarios were analyzed and have
project should be compared with the future net given a good indication of the project magnitude.
revenue to be received from the project. And if Table 4 shows the capital cost e.g. the
the expected net revenue is greater than the cost until end of installation of each project. This
expected investment cost, the project should be involves cost of procurement, construction,
completed but if not, the project should be engineering, maintenance, administration and
abandoned. Therefore, in making a final decision operational cost during installation.
on installing ESP, HP or GL systems on these

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4. RESULTS AND DISCUSSION decline) at the end of production. For GL (in

black), a steady oil production rate was observed
4.1 Results throughout the first 6 years of production with
rapid decline (about 33% decline) at the end of
4.1.1 Results of oil production forecast for the last 3 years of production. Also, for HP (in
well 1 with base-case (no lift), ESP, GL, red), there was a steady decline (about 39%
and HP decline) in oil production rate throughout the
period of production.
Fig 7. presents base-case (no lift), ESP, GL, and
HP Performances of Well1 in terms of Oil 4.1.2 Simulation results of gas production for
Production (WPR) versus time. The base-case well 1
indicates (in blue) that there was a steady oil
production through the period of 6 years before Fig. 8. presents the base-case, ESP, GL, and HP
gradually decline towards the end of production. Performances of Well1 in terms of Gas
For ESP (in yellow), a steady oil rate was Production (WPR) versus time. For HP, base-
observed throughout the period of production case, GL, and ESP, Gas production was on the
forecast (9 years) with a slight decline (about 3% increase throughout the period of production.

Fig. 4. Workflow for the operation of GAP software

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Table 2. Gas lift design Parameters from field X

Gas lift parameters Values

Gas Lift Gas Gravity 0.8
Maximum Liquid Rate 15000 stb/day
Maximum Gas Available 10 MMscf/d
Maximum Gas while Unloading 10 MMscf/d
Flowing Top Node Pressure 200 psig
Unloading Top Node Pressure 200 psig
Operating Injection Pressure 1500 psig
Kick Off Injection Pressure 1500 psig
Desired dP across Valve 200 psi
Maximum Depth of Injection 7500 ft
Water Cut 80%
Minimum Valve Spacing 250 ft
Static Gradient of Load Fluid 0.5
Minimum Transfer dP 25%
Maximum Port Size 32 (set by valve series selection)
Safety for Closure of Last Unloading Valve 0 psig
Rating Percentage for Valves/Orifice 100%

Fig. 5. ESP performance curve

Fig. 6. HP performance curve

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Table 3. Collected downhole equipment from field X

MD(feet) TVD(feet) Xmas Tree MD (feet) inches Tubing (ID) inches Roughness Inches Tubing (OD) inches Casing (ID) Inches
0 0 59.4 1 0.0006 0 0
463.3 463.3 Tubing 689 4 0.0006 4.5 8.7
2399.9 2368.4 SSSV 0 2.1 0.0006 0 0
3450.1 3256.6 Restriction 7660.8 4 0.0006 4.5 8.7
4649.9 4100.1 Tubing 0 2.3 0.0006 0 0
5200.1 4467.5 Casing 7677.2 4 0.0006 4.5 8.7
6899.9 5673.9 Casing 7860.9 0 0.0006 0 8.7
7450.1 6076.7 Casing 8169.3 0 0.0006 0 6.2
8687.7 7280.2 Casing 8687.7 0 0.0006 0 4

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Table 4. Estimated cost for ESP, HP and GL

For Nine Years HP GL ESP

Item Cost ($1,000,000) Cost ($1,000,000) Cost ($1,000,000)
Downhole pump/Installation 5 0 20
Equipment 5.1 10 15
Purchased Gas 0 15 0
Operating/Maintenance 15 3.2 25.5
Sum 25.1 28.2 60.5

900
Basecase HP GL ESP
800
Oil Production (MSTB/YEAR)

700
600
500
400
300
200
100
0
1 2 3 4 5 6 7 8 9
Time (Year)

Fig. 7. Presents the base-case, ESP, GL, and HP Performances of Well1 in terms of Oil
Production (WPR) versus time

ESP GL HP Basecase
90
Gas Production (MMSCF/YEAR)

80
70
60
50
40
30
20
10
0
1 2 3 4 5 6 7 8 9
Time (Year)

Fig. 8. Presents the base-case, ESP, GL, and HP performances of well1 in terms of gas
production rate (GPR) versus time

4.1.3 Simulation results of water production production, it was observed that Water
for well 1 breakthrough occurred after 2 years and
increases throughout the period of production.
Fig 9. presents the base-case, ESP, GL, and HP For ESP, GL and HP productions, Water
Performances of Well1 in terms of Water breakthrough also occurred after 2 years and
Production (WPR) versus time. For base-case increased till the end of production.

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4.1.4 Simulation results of oil production for of production. Also, for HP, indicates that a
well 2 gradual decline (about 44% decline) in oil
production was observed with increasing gas
Fig. 10: presents the base-case, ESP, GL, and production throughout the period of production.
HP Performances of Well2 in terms of Oil
Production (OPR) versus time.For base-case 4.1.5 Simulation results of gas production for
well2, the Figure indicates that there was a well 2
steady oil production throughout the period of
production. For ESP, a steady oil rate was Fig. 11. presents the base-case, ESP, GL, and
observed throughout the first 6 years of HP Performances of Well2 in terms of Gas
production with a slight decline (about 21% Production (WPR) versus time.For HP, GL, and
decline) at the end of production. For GL, ESP,Gas production was gradually on the
indicates that a gradual decline (about 23% increase throughout the period of
decline) in oil production was observed with production with a tremendous increase on base-
increasing gas production throughout the period case scenario.

HP GL ESP Basecase
1000
Water Production (MSTB/YEAR)

900
800
700
600
500
400
300
200
100
0
1 2 3 4 5 6 7 8 9
Time (Year)

Fig. 9. Presents the base-case, ESP, GL, and HP performances of well1 in terms of water
production rate (WPR) versus time

ESP GL HP Basecase

700
Oil Production (MSTB/YEAR)

600
500
400
300
200
100
0
1 2 3 4 5 6 7 8 9
Time (Year)

Fig. 10. presents the base-case, ESP, GL, and HP Performances of Well2 in terms of oil
production rate versus time

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Basecase HP GL ESP
40

Gas Production (MMSCF/YEAR)

35
30
25
20
15
10
5
0
1 2 3 4 5 6 7 8 9
Time (Year)

Fig. 11. Presents the base-case, ESP, GL, and HP Performances of Well2 in terms of gas
production rate versus time

4.1.6 Simulation results of water production any investment because their NPVs are negative
for well 1 at the discounted rate of 25% Fig 14.

Fig. 12. presents the base-case, ESP, GL, and 4.1.9 Internal rate of return (IRR) at 15%
HP Performances of Well2 in terms of Water discount rate
Production (WPR) versus time. For base-case
production, it was observed that Water The economic results obtained in terms of IRR at
breakthrough occurred after 2 years and the discounted rate of 15% shows that GL well 1
increases throughout the period of production. and ESP wells (well 1 and well 2) will be
For GL and HP productions, Water breakthrough profitable projects because their discounted rates
also occurred after 2 years and that will be required to generate NPVs of zero
increased till the end of production with a are greater than the given discounted rate (15%).
tremendous increase on ESP scenario. The GL well 2 and HP wells (well 1 and well 2)
will not be profitable in terms of any investment
4.1.7 Net present value (NPV) results at 15% because their IRRs are below the given
discount rate discounted rate (15%), Fig. 15. Here, the wells in
green indicate that the project will be profitable
The economic results obtained in terms of Net and those in black indicate that the project will
Present Value (NPV) at the discounted rate of not be profitable.
15% shows that GL well 1 and ESP wells
(Well 1 and well 2) will be profitable because 4.1.10 Internal rate of return (IRR) at25%
their NPVs are positive. Hence, GL well 2 and discount rate
HP wells (Well 1 and well 2) will not be profitable
in terms of any investment because their NPVs The IRR at the discounted rate of 25% shows
are negative at the discounted rate of 15% Fig. that only ESP wells (well 1 and well 2) will be
13. Here, the wells in green indicate profitable because their IRRs are above 25%.
that the project will be profitable and Both GL and HP wells will not be profitable in
those in red indicate that the project will not be terms of any investment because their IRRs are
profitable. below 25%, Fig. 16.

4.1.8 Net present value (NPV) results at 25% 4.1.11 Profitability index (PI) at 15% discount
discount rate rate

The NPV at the discounted rate of 25% shows The economic results obtained in terms of PI at
that only ESP wells (well 1 and well 2) will be the discounted rate of 15% is presented in. It
profitable because their NPVs are positive. Both shows that at 15% GL well 1 and ESP wells (well
GL and HP wells will not be profitable in terms of 1 and well 2) will be profitable projects because

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their PIs are greater than 1. The GL well 2 and in terms of any investment because their PIs are
HP wells (well 1 and well 2) will not be profitable less than 1 at the discounted rate of 15% Fig 17.

GL ESP HP Basecase

900
Water Production (MSTB/YEAR)

800
700
600
500
400
300
200
100
0
1 2 3 4 5 6 7 8 9
Time (Year)

Fig. 12. Presents the base-case, ESP, GL, and HP Performances of Well2 in terms of water
production rate versus time

Fig. 13. NPV @ 15% discount rate

Fig. 14. NPV @ 25% discount rate

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Fig. 15. Plot of IRR @ 15%

Fig. 16. PLOT Of IRR @ 25%

Fig. 17. Profitability index @ 15% discount rate

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4.1.12 Profitability index (PI) at 25% discount was observed that at 15% discount rate, GL well
rate 1 and ESP wells (well 1 and 2) will be profitable
because their discounted rates that will be
The PI at the discounted rate of 25% shows that required to generate NPVs of zero are greater
at only ESP wells (well 1 and well 2) will be than the given discounted rate (15%). When a
profitable and both GL and HP wells will not be discounted rate of 25% was used, it was
profitable in terms of any investment because observed that only ESP wells (well 1 and 2) will
their PIs are less than 1 at the discounted rate of be profitable because their discounted rates that
25% Fig. 18. will be required to generate NPVs of zero are
greater than the given discounted rate (25%).
4.1.13 Economic analysis result Both GL and HP wells will not be profitable in
terms of any investment because their IRRs are
To analyze the economic viability of these below the given discounted rate (25%). For the
projects, three economic indicators, Net Present Profitability Index analysis, it was observed that
Value (NPV), Profitability Index (PI) and Internal at 15% discount rate, GL well 1 and ESP wells
Rate of Return (IRR) were employed to assess (well 1 and 2) will be profitable because their PIs
the profitability of the projects. For the Net are greater than 1. When a discounted rate of
Present Value analysis, it was observed that at 25% was used, it was observed that only ESP
15% discount rate, GL well 1 and ESP wells (well wells (well 1 and 2) will be profitable because
1 and 2) will be profitable because their NPVs their PIs greater than 1. Both GL and HP wells
are positive. When a discounted rate of 25% was will not be profitable in terms of any investment
used, it was observed that only ESP wells (well 1 because their PIs are less than 1 at the
and 2) will be profitable because their NPVs are discounted rate of 25%. Figs 19 and 20
positive. Both GL and HP wells will not be presented the overall performances of well1 and
profitable in terms of any investment because well2 in terms of gas production rate (GPR), oil
their NPVs are negative at the discounted rate of production rate (OPR) and water production rate
25%. For the Internal Rate of Return analysis, it (WPR) versus time respectively.

Fig. 18. Profitability index @ 25% discount rate

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WELL 1
1000

900

800

700

600

500

400

300

200

100

Fig. 19. Presents the base-case, ESP, GL, and HP Performances of Well1 in terms of oil, water and gas production rates

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WELL2
6000

5000

4000

3000

2000

1000

Fig. 20. Presents the base-case, ESP, GL, and HP Performances of Well2 in terms of oil, water, and gas production rates

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5. CONCLUSION Mrs. Oluchi Ndubuka, Engr. Elvis Okere and Mrs.

Ijeoma Nnenna Okere.
From this study the following conclusions can be
made: COMPETING INTERESTS

1. The base-case oil production for well1 Authors have declared that no competing
dropped from 104,000 stb/year to 21,000 interests exist.
stb/year (about 80% decline) and that of
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© 2021 Ndubuka and Akpabio; This is an Open Access article distributed under the terms of the Creative Commons Attribution
License (http://creativecommons.org/licenses/by/4.0), which permits unrestricted use, distribution, and reproduction in any
medium, provided the original work is properly cited.

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