Simulation benefits in oil exploration

Simulation benefits in oil explorationFaizan Ahmad 110513 DOil shapes our routine life

Challenges in oil exploration

Cost involved in oil explorationOil processing plants and refineries involve billions of dollars of investments.Operational costs are also very large.cost of reserving ships for oil exploration is tens of thousands of dollars per day.Oil Industry have to Find and exploit the opportunities for cost minimization.

How simulation helpsimprove the quality of decision makingconduct a series of what-if analysescreate a computer model to copy a real production or logistics process.Frequency and persistence of weather patterns, plant failures and equipment outages are accurately reflected using statistical distributions How simulation helps (Cont.)cost reduction & justification for expenditure greater efficiency leading to increased revenueThreats to cost reduction are production and delivery performanceSimulation provides ways to uncover the most cost effective means of achieving a specific goal

How simulation helps (Cont.)simulation allows all opportunities to be evaluated to understand if they can be feasibly exploitedSimulation helps in optimizing loading or discharging processes and shipping fleet portfolio.Help in minimizing logistics cost i.e. ships move between ports, inventory levels rise and fall according to the demand and supply respectively

Conclusionthere are an enormous number of variables i.e. random events (e.g. weather), cyclical events (such as daylight and tides) and demand profileseach of these variables interacts and affects the overall results.Simulation allow any parameter to be changed so that solutions can be tested.ensure that recommendations are robust and well founded.manages the costs and expenditures.