Multi-Criteria Decision Making in Strategic Reservoir Planning Using the Analytic Hierarchy Process

Abstract

Abstract The paper describes the use of the Analytic Hierarchy Process in the strategic planning for the development of a series of reservoirs in the same field. A department of the Kuwait Oil Company is responsible for the development of these reservoirs and needed to determine the best order in which to develop these assets. In order to do this it was necessary to make judgements regarding how well any development option met a set of strategic criteria. At the individual reservoir level, it was also necessary to judge which development option best met a set of criteria for the development of specific reservoirs. A decision hierarchy was developed that reflected the ordering of the criteria and the specific alternatives. Pair-wise comparisons of the various criteria were made in order to determine how well they satisfied the overall objective. These judgments were evaluated using a judgment matrix to determine weights for the criteria. These criteria were applied to decisions to be made at the next lower level in the hierarchy. In this way, the decisions, which were judged to best meet the overall objective, were given the highest priority. This influence cascaded down through the hierarchy to rank the development options. With this structure it was simple to substitute one overall objective for another to determine whether this would cause a change in decision policy. The sensitivity of the decision outcome was also evaluated for its sensitivity to the range of values of the input factors. Since there were thirty-five factors to evaluate, a statistical design approach was used to evaluate factor effects. It is shown that the planning factors, planning horizon and the demand scenario used for planning purposes were significant in all cases evaluated, and highlighted the importance of testing the assumptions, criteria and objectives in a strategic planning exercise.