Catastrophic Failure

“We can afford to lose money – even a lot of money. But we can’t afford to lose reputation – even a shred of reputation.”

Warren Buffett

Failure of well integrity management has catastrophic direct and consequential impact on oil companies.

The gas leak suffered at Total’s Elgin G4 well resulted in a direct loss in excess of $5 billion and knocked around $25 billion off Total’s market capital value. Total’s SPE paper (SPE168478) explains how the right systems were not in place to anticipate what was coming. Total could not see how bad their situation was and what was about to hit them.

The incidents at BP Macondo and Total Elgin were suffered by prominent international oil companies with well developed practices and sophisticated risk management capabilities. The problems that beset these companies are all too common and are the result of a blind spot that our industry has in the critical area of well risk management.

If operators have an intimate understanding of individual well integrity issues and can see the threats they face, similar massive losses can be avoided.

Photo Credit: Total E&P UK Ltd

25th March leak started 15th May leak stopped

$25 billion knocked off Total’s market capital between 25 March & 15 May 2012, during the gas leak suffered at the Elgin G4 well.

Empirica

Evidence based well risk management

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You can meet this challenge with Empirica

When you cannot see, these threats can hit any oil and gas producer at any time; hurting your people, your reputation and your company.

You have a systematic approach to well integrity management and can see what’s coming with Empirica.

Industry Challenges

Project Delays<br/>& Cost Overruns

Project Delays
& Cost Overruns

If you do not change direction you may end up where you are heading

Business Cycles

Business Cycles

Issues related to staffing will be the most critical challenge we have ahead of us

Global Lost Production

Global Lost Production

Over $30 billion lost every year for well integrity reasons

Well Risk Insurance

Well Risk Insurance

Mind the gap

Performance<br/>Advantage

Performance
Advantage

Tipping the balance in your favour

Unnoticed<br/>Losses

Unnoticed
Losses

The hidden cost behind apparent best practices

Oversight & Regulation

Oversight & Regulation

Meeting your obligations

Unseen Risks

Unseen Risks

Mastering Well Integrity is impossible if you cannot see the real risks

Well Abandonment

Well Abandonment

Avoid a sting in the tail

Catastrophic<br/>Failure

Catastrophic
Failure

We can’t afford to lose reputation – even a shred of reputation