Publications

A deep-water well is one of the high profile project which is closely related to a high cost project. One of the key success prior starting the project is by conducting the cost estimation (Owner Estimate). For a typical new operation with limited offset data, market survey is one of the way to have the base cost estimation. Performing a market survey for estimating owner estimate prior to perform tender process and also a need for a basis of well cost is critical step in calculating economic of the well or investment decisions during well planning. Many approaches to perform the market survey and sometimes people customize them in order to fit with the purpose. This paper is trying to exercise some of the market survey methodology options and also to describe the impact to the selection of procurement strategy and maturation of cost estimation. The market survey methodology will be presented in details for each options. Experiences while estimating long lead items (LLI) and drilling services costs for a deep-water exploration drilling well were exercised here. The outcomes were compared and assessed. Nevertheless, literature reviews are also performed to enrich understanding and better judgment when estimating the cost. By performing a comprehensive market survey, we have successfully determined the current market condition and accurate cost estimation, which plays crucial roles in the decision making process for the best procurement strategy. Additionally, with the selective and progressive method in the market survey, it has narrowed down the bias cost data, especially for some of the major drilling services contract. The method on the market survey has established also an advantage in the remuneration strategy which leads to a cost saving in the project and also helps to fit in the project timeline.