KAZAKHSTAN UPSTREAM OIL AND GAS technology and R&d ...

Executive summary
8
Capital and technologyintensive
industry
Oil and gas is among the most capital and
technology intensive of all industries, and
the role of technology innovation in aiding
the discovery of economically viable new
reserves and improving the efficiency of
resource extraction is critical. Investments in
R&D, aimed at supporting vital Kazakh oil
and gas projects, will also help to realise the
country’s broader industrial and economic
potential. But for innovation to be effective,
research and development priorities must be
business-driven and in line with the upstream
industry’s needs.
In order to help Kazakhstan focus its R&D
efforts and to contribute to the government’s
innovation agenda, Shell undertook to work
with the entire industry and to lead the
development of the Kazakhstan upstream
oil and gas technology and R&D roadmap.
A coherent picture of the oil and gas sector
is a prerequisite when making high-level
decisions. When the industry has to decide
which technology alternatives to pursue,
how quickly they are needed, or how to
coordinate the development of multiple
technologies, roadmapping is essential to
controlling capital expenditure and ensuring
cost-efficient R&D activities.
Following the pragmatic steer from the
President of Kazakhstan, Nursultan
Nazarbayev, the industry has collectively
supported the formulation of technology
and research priorities, which is essential to
ensuring that common industry challenges
are addressed effectively.
Since the start of this initiative in 2010
more that 100 industry representatives
have made valuable contributions to the
roadmap development – more than 300
industry representatives were involved
in the workshops, interviews and expert
panels. This was a unique opportunity
for Kazakhstan R&D organizations to
interact directly with operators and service
companies from oilfields throughout
the country and to share knowledge
and experience and develop a better
understanding of the technology challenges
faced by the industry. The project has
demonstrated the potential for improved
knowledge sharing through structured
industry forums and workgroups. The
academic institutes possess a wealth of
knowledge and are passionate about
contributing to the oil and gas field
developments in Kazakhstan. Improved
communication is bound to help unlock the
potential that exists within this community.
The roadmapping project achieved a
number of important objectives. The industry
collectively identified, screened and ranked
the main technology challenges based on
the potential financial benefits that could
result if they are successfully addressed.
Potential technology solutions were also
identified and assessed in terms of their
impact on solving the challenges and on
their attractiveness to the nation, which
included consideration of local R&D and
industry opportunities.
The fifteen prime challenges identified have
a significant value associated with them,
assuming appropriate solutions can be
implemented in the required timeframe. The
challenges were assessed using a standard
industry financial model. The categories
considered were capex reduction, opex
reduction, increased production, increased
ultimate recovery, reduced environmental
risk and improved personal safety. The
indicative values of the fifteen challenges
varies between US$2 billion and US$7.5
billion. Clearly the total value of successfully
addressing all of the 15 challenges would
be several tens of US$ billions.
Kazakhstan Upstream oil and gas technology and R&D roadmap