How to manage the oil price boom
Essensity oil developers have released a new study that has found that if you don’t invest in a production facility early, it could cost you up to $5 billion dollars in future production costs.
In a study published on the Australian Oil & Gas Association website, the researchers found that the cost of an Essensity Oil Production Facility to be $2.5 billion to develop and operate in the 2030s.
They found that a facility could only produce a maximum of 30,000 barrels per day, with an average production of around 10,000 to 15,000 bpd.
They also found that an Essense Oil Production facility had an average lifetime of 8.5 years, but an average lifespan of just 2.7 years if you were to operate it for 20 years.
The research found that in the oil boom of the 2040s, an Essence Oil Production Site would need to be constructed within a 12-hour radius of an oilfield and that it would have to have a minimum capacity of 10,200 barrels per week, with a maximum capacity of 45,000bpd.
It is the first study to look at the cost for an oil field to be developed and operated as part of the oil production process, with the authors concluding that an oil and gas field is not a simple business investment.
The study was conducted in partnership with the Australian Strategic Energy Development Agency (ASEDA), the Australian National University, and the Australian Energy Market Operator.
The authors said they wanted to ensure that Essensity was the most cost-effective option for oil and energy development in Australia.
The Essensity study is an extension of a previous study released in 2013, that found that investing in a small oilfield would not increase production costs as much as the Essensity project would.
Essensity’s first oil field site was discovered in 2014 and is located in the Goolwa region of Western Australia.
The Essensity team has said it has a long-term plan for the oilfield, which will have a maximum output of 30 million bpd in 2030.