#28 Digital Energy Journal - Jan 2011

8/8/2019 #28 Digital Energy Journal - Jan 2011

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January 2011 Issue 28

Drilling: time for betterdata?

Lessons from medicineand military

Are you competent incollaboration rooms?

Do you challenge yourcolleagues enough?

Computer models to improve safety planning

Yuck! Technical details

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January 2011 Issue 28

January 2011 - digital energy journal

Digital Energy Journal - keeping you up to date

with developments with digital technology in

the oil and gas industry.

Subscriptions: Apply for your free print or elec-

tronic subscription to Digital Energy Journal on

our website www.d-e-j.com

Printed by Printo, spol. s r.o., 708 00 Ostrava-Poruba,

Czech Republic. www.printo.cz

Digital Energy Journal2nd Floor, 8 Baltic Street East, London EC1Y 0UP, UK

Digital Energy Journal is part of Finding Petroleum

www.findingpetroleum.com

www.digitalenergyjournal.com

Tel +44 (0)207 017 3405

Fax +44 (0)207 251 9179

EditorKarl Jeffery

[email protected]

Consultant editorDavid Bamford

Technical editorKeith [email protected]

Finding Petroleum London ForumsAdvances in seismic - January 25

Advances in exploration technology - February 15Improving recovery from existing fields - March 16Digital oilfield - subsurface data - April 20Technologies to avoid another Macondo - May 17Digital Oilfield IT infrastructure - June 14

Carbon capture and storage (TBC) - Sept 14Digital Oilfield and people - Oct 20Developments with deepwater - Nov 9Digital Oilfield 2011 - Nov 30

Social networknetwork.findingpetroleum.com

Advertising and sponsorshipJohn FinderTel +44 (0)207 017 [email protected]

1

Cover photo: Detroit company EOS Solutions,

working together with Norisol of Norway, is

developing "4D" simulation tools for oil and gas

installations, which can be used for planning and

training purposes. Here they are being used to see

how fast a rig can be evacuated

David BamfordConsultant Editor, Digital Energy Journal

Time is money!

In earlier articles and blogs, Ive suggested that

technology providers especially those with nov-

el ideas will see tremendous pull from cus-

tomers if they can show that they will deliver one

of my 3Rs a major reduction in risk, a major

reduction in cycletime, or a major reduction in

costs.

I have been asked several times what I

mean by cycle-time reduction and as always,

the easiest way to explain is with a couple of ex-

amples.

Firstly, if we go back to the end of the

1980s, 3D seismic technology was well estab-

lished but it took an outrageously long time. My

memory is that going from project inception,through design, funding, contracting, acquisition,

processing and interpretation for a North Sea

postage stamp survey of a hundred sq kms or

so could easily take two years and even then

not all the data would be interpreted.

In the early 1990s, we began to transform

3D seismic so that much bigger regional or ex-

ploration 3Ds were shot and turned around to full

interpretation in a matter of months rather than

years. The key technology components of this

transformation were the extraordinary new seis-

mic vessels that emerged, capable of towing alarge number of streamers, a move to on-board

processing, and the availability of high perform-

ance interpretation workstations.

It was noticeable that the key contributors

to this transformation were players who were

then quite small and entrepreneurial PGS,

Geco, Geoquest, Landmark, for example. Bigger

companies were much less helpful - even the in-

house technology departments of the Majors

where for example they were intent on develop-

ing their own processing or interpretation sys-

tems.

Nowadays of course such exploration 3Ds

are the norm the dramatic reduction in cycle-

time resulting in dramatic reductions in unit costs

($/sq km) and reductions in risk (increases in ex-

ploration success rate), and of course in the num-

ber of such surveys that have been shot. It would

not be overstating to say considering the dra-

matic increase in size of such surveys and reduc-

tion in cycle-time, that there has been more than

an order of magnitude improvement.

Secondly, our friends at Bernstein Research

have recently highlighted another example which

is the dramatic increase in value which accrueswhen companies can shorten the time from dis-

covery to first oil or, conversely, noting that eco-

nomic value can be eroded by 50% for just a 2

year delay. A majority of upstream capex is allo-

cated to development, hence meeting targets here

is critical. Specifically, the NPV of a project can

easily be halved by a two year longer lead time,

equivalent to a $15/bbl drop in the oil price over

the entire life of the project.

Of course, I need to remind everybody that

I am a non-executive director at Tullow Oil which

has just delivered first oil from the Jubilee field

in Ghana in significantly less than 4

years..

Such a field development requires the com-

plex integration of many technologies the FP-

SO, flow-lines, trees, drilling, completions, reser-

voir modelling, 3D seismic and so on all of

which requires skills and Know How and the

ability to deal with folk (including non-executivedirectors!) who tell you it cant be done so quick-

ly. And the prize for acceleration is very large.

So where is there another piece of fruit to

be picked, preferably low hanging? No doubt oth-

ers will have their own favourites but heres

mine

Cutting the Gordian Knot!

The mythology is of an intricate knot tied by

King Gordius of Phrygia and cut by Alexander

the Great with his sword after hearing an oracle

promise that whoever could undo it would be the

next ruler of Asia.In modern times, a 'Gordian Knot' is taken

to mean an exceedingly complicated problem or

deadlock.

Here's my problem - how do we transform

onshore exploration success rates to the same lev-

el enjoyed offshore, especially in deep water?

Simples!

[At the risk of confusing any one who has

not seen the meerkat Aleksandr Orlov on British

TV!]

As noted above, the transformation in off-

shore exploration success rates, from the mid

1990's onwards, was brought about by the wide-

spread availability of remarkably inexpensive re-

gional or 'exploration' 3D seismic.

What we need to do now is to drive down

the cost of onshore 'exploration' 3D to the same

levels as offshore. The key is to be able to acquire

and process onshore 3D seismic far, far faster

than we can today.

To do this, the big step - the wielding of the

sword - is to replace cable seismic with wireless

systems.

I am hopeful that in our first two Finding

Petroleum Forums of 2011 on January 25th andFebruary 15th we will hear from the companies

that will lead such breakthroughs visit

www.findingpetroleum.com of course for details.

And with that, a Merry Christmas and Hap-

py 2011 to all!


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5/243January 2011 - digital energy journal

Contents

Do you challenge your colleagues enough?One of the signs of a successful collaborative environment is that people feel comfortable challenging each other says Jim Kochan of VitesseSolutions, knowledge management consultant to Conoco Phillips

Yuck! Technical detailsIf you want to get people interested in the digital oilfield, youve got to get them interested in the technical details something peoplenormally dislike, writes Dutch Holland

Software for oil industry real estateMany oil and gas companies could benefit from a more structured approach to facilities and real estate management, writes Phil Wales, CEOof Houston-based eBusiness Strategies

15

Production

14

Exploration

12

6

10

17

7

8

Leaders - Integrated Operations conference in Trondheim

Using object databases for seismic dataObject databases can provide much faster results than relational databases, when you are trying to look for complex patterns andrelationships within the data, as two major seismic companies have found out

GeoGraphix - software for independentsGeoGraphix, a brand of interpretation software geared towards the needs of independent oil and gas companies (particularly working onland), is no longer part of Halliburtons Landmark software and services portfolio

4Drilling: time for better data?A conference session at the Integrated Operations conference in Trondheim (Sept 28-29)looked at how the data in drilling can be improved

Are you competent in collaboration rooms?Grete Rindahl of Norwegian Institute for Energy Technology (IFE) has been researching

how well people are using collaboration rooms and what constitutes competentbehaviour

Lessons from medicine and militaryThe oil and gas industry might be able to learn a lot from how medicine and military useintegrated operations, and have some expertise to share, said speakers at the TrondheimIO Conference

Developments at Kongsberg, Shell, Petrobras, Saudi AramcoThe Trondheim Integrated Operations conference on Sept 28-29 included new ideas from Kongsberg, Shell, Petrobras and Saudi Aramcoabout how to get the most out of integrated operations

Innocentive crowdsourcing ideasUS company InnoCentive is helping oil and gas companies find solutions to technical problems by posting them on the web but it takesskill and organisation to get the right result. VP sales Jon Fredrickson explained how it works at the Trondheim Integrated Operations

conference

13

Communications

NSI Upstream your production on the webNSI Upstream of Louisiana creates a means for companies to monitor and manage their production from anywhere, including on theinternet, and has completed a large project for the 100kbopd Kikeh deepwater development in offshore Malaysia

US regulators might want real time data from rigsUS regulators might demand real time data from drilling rigs, according to Michael Bromwich, director of the US Bureau of Ocean Energymanagement, Regulation and Enforcement (BOEM), speaking at a recent Platts Energy Podium event in Washington on October 12 2010

20

21

Computer models to improve safety planningEOS Solutions and Norisol are providing oil and gas companies with 4D processsimulations to optimize their operations and planning, to help mitigating risk 19


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Leaders

digital energy journal - January 2011

Drilling: time for better data?A conference session at the Integrated Operations conference in Trondheim (Sept 28-29) looked at howthe data in drilling can be improved

We have severe challenges with data quali-

ty and using models, and reliability of the

models we use, said Tor Stein lberg, spe-

cial advisor with Sintef Petroleum Research,

and previously chief engineer and VP

drilling and well technology working at Saga

Petroleum, Norsk Hydro and Statoil).

These models have limitations and we

dont even consider them.

I dont want to get more data I would

like to see more reliable data, he said.

Ive been drilling 25 years. When I

started in drilling, one of the first things Isaw was problems with quality data, he

said. Today we have the same type of prob-

lem.

Safety is totally dependent on quality

of data, he said. The performance of drilling

and operation is dependent on data and in-

formation.

For example, [the point] where we

measure depth from. We normally measure

rotary kelly bushing although we dont have

them any more. And on another rig it has a

different rotary kelly bushing so depth willbe wrong.

Next you use a wireline and it has a

different elongation so you make measure-

ments of the same formation to a different

depth. Coiled tubing is another depth meas-

urement.

Units also cause a data management

problem. Degrees can be K C or F. Is meas-

urement depth in feet or metres. The systems

we use are very prone to take the numbers

and not accept the units.

Taking periodic data readings could be

compared to driving to the airport and open-ing your eyes only every 20 minutes, he said.

We are drilling blindly.

Matthew Spotkaeff, SchlumbergerMatthew Spotkaeff, Well Placement Domain

Champion for the North Sea with Schlum-

berger, said that for well placement, data is

needed to help evaluate the formation (iden-

tifying drilling hazards and working out

what kind of equipment needs to be installed

in the well such as sand screens); and for

steering the wellbore in the right zone.This needs data being sent up to ground

from the drill bit.

Normally only mud pulse telemetry is

available, with data speeds of 1.5, 3 or 6 bits

per second, compared to over 1 megabit per

second data speed when using wireline tools.

With these data rates of up to 6 bits per

second, the company has to steer horizontal

wells thousands of feet long.

The low bandwidth availability has a

very big impact on how we use the data, he

said. We have to be careful about setting up

data frames before we start drilling.

But using data compression techniques,

the equivalent of 100 bps can be sent through

a 6bps line. So theres a step change interms of the data we can get, he said.

The increase in data rate is a big boom

for drilling optimisation. We can do a full

formation evaluation analysis of the well-

bore.

There can be goal conflicts between the

drilling engineer and geologist, with driller

wanting to keep the well as smooth as possi-

ble, and geologist wanting the well to be kept

within the payzones.

But if the two people are sitting togeth-

er and viewing the same data it is easier forthem to resolve the conflict. A lot more col-

laboration is obtained from sharing data, he

said.

The earth model can be updated using

data from the drilling. You change your

model so it equates with the actual data and

see how this affects how you carry on with

the well eg changes in drilling tools, pa-

rameters. Then record the lessons learned to

make sure we dont fall into the same traps

again.

When drilling through certain forma-

tions, the drill bit can start jerking, with

shocks of 8-10g (8 10 times acceleration

due to gravity). This damages the tool. If

we can prevent shocks, we can prolong thelife of the tool until total depth, he said.

And replacing a tool can be a day or week

of rig time.

If there is a decrease in revolutions per

minute of the mud pump, it can be due to a

washout, with drilling mud leaking through

the drillstring. If this isnt picked up quickly,

the leak in the drill string can turn into a

breakage, and a lot of complex work fishing

or sidetracking to get the drilling going

again.

In one example, a company changedthe drillbit because the drilling was slow, but

after enduring this expense and non produc-

tive time, they found that there wasnt much

improvement in rate of penetration.

But when the rock resistivity log was

The Drilling Session at the IO conference: on the panel from left to right: Jon Strkeby, IBM;Matthew Spotkaeff, Schlumberger; Mike Herbert, ConocoPhillips; Halvor Kjrholt, Statoil (hiddenbehind microphone) and Tor Stein lberg, Sintef


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Leaders

January 2011 - digital energy journal 5

examined, with data sent to surface by mud

pulse telemetry, it showed that the drillbit

had moved into a formation with a different

resistivity and maybe the change in rate of

penetration was due to the mud interacting

with the different type of rock in a different

way. So they changed the mud parameters

and solved the problem, he said.

The next generation of drilling teleme-

try is wired drill pipe, where up to 50,000

bps can be sent to the surface, which enables

communications directly with the tools.

Previously to change a tool setting it can

take 20 minutes by mud pulse, now we can

do it with a switch, he said.

One of the reasons for the slow take-up

of wired drill pipe was because drilling com-

panies were initially required to buy a whole

set of drill strings before they could use it,

Mr Spotkaeff said. Now it is rented.

Another problem with wired drill pipeis that the signal degrades at over 6000m of

drill pipe. They had to come up with re-

peater boxes. Its something people have

been working on for quite a number of

years, he said.

It is still a challenge is working out how

to get the most out of the data. Its not just

about getting 50 curves. It's orders of mag-

nitude different. Thats an issue which needs

to be overcome, he said.

StatoilMarvin Hammervold, researcher drillingtechnology at Statoil, talked about Statoils

pilot projects to try out ways to keep hy-

draulic and mechanical models up to date

during drilling using real time data.

We need to change from reporting to

our proactive use of real time data, he said.

Take pore pressure gradient we need

to have the models updating during drilling

there are huge uncertainties behind these

models, he said.

The concept is we get sensor data for

surface and downhole, and all the configura-tion data. The data is coming from differ-

ent sensors, different vendors. We have mud

logging sensors, downhole sensors, rig sen-

sors. These are fed into the process models.

We want to use all this live real time data for

controlling the drilling.

One of the hardest things is getting real

time drilling data which is high enough qual-

ity. If the model is being fed bad data the

bad data comes out the other end, he said.

Its a real risk taking bad data, putting it in-

to models and trusting them.Small errors in data can have grave

consequences, he said. All these processes

can go very wrong if you have one bad data

point. And the models have their own uncer-

tainties and limitations, he said.

Better data organisation is also neces-

sary. Its a jungle out there. We need to stan-

dardise on mnemonics (ways of tagging the

data). We need good housekeeping. We need

to build in some kind of diagnostics check,

he said.

All the vendors have their own data

acquisition system, but theyre not even on

the same timeline.

And sensors are often very unreliable.

We need some redundant sensors, but not the

same sensors twice.

The biggest problem is getting good

mud data. Get that wrong and your model is-

nt worth much.

One challenge is working out how to

persuade service companies to provide high-

er quality data and if this should be includ-

ed in a contract.

Mike Herbert, Conoco PhillipsMike Herbert, integrated operations advisor

to ConocoPhillips in Norway, agreed that

one of the things we all struggle with is data

quality.

In drilling we are amazingly tolerant

of poor data. We needed to put that behind

us and really value quality he said. If we

dont gather quality data the picture we see

is not very representative.

The lack of quality data means we

dont really know where the well is. We have

huge uncertainties, he said. We find outtoo late the formation fluids are entering the

well bore. We dont know if we bypassed

some reserves.

If people were better at communicating

with each other, they might find better ways

to improve the data, he suggested.

Weve obsessed with graphs I hate

graphs. I think in pictures. We can visualise

completions drilling, production drilling,

down hole tools. One of the most important

things is communication and its much easi-

er in pictures. Simple.

We need to fix the basics depth,weight on bit, mud properties, he said.

Lets start with these. I think we should

have an industry goal to get the basics right.

If we can get some of this right we can start

having a much more integrated system.

We need to clarify our expectations

with data we need to reward good quality

data, he said.

Updating data models does not neces-

sarily require more data. Some of the infor-

mation we need to make a real time hy-

draulics model we might only get thattwice a day, he said. We can do less data

and more quality.

Were making so much effort around

data quality. Its very labour intensive and a

lot of this should be automated, he said.

Audience discussionOne audience member noted that drilling is

not the only industry in the world which has

to deal with complex and sometimes unreli-able data.

There are also technical ways to im-

prove data. If theres noise you have to

work out what kind of noise there is and how

to filter it. This has been done in a lot of dis-

ciplines.

Roar Nyb, research scientist at SIN-

TEF, suggested that people dont take data

quality seriously enough.

When we have drilling problem like

losing fluid we call that a drilling problem

and we have alarm systems. But when the

sensor is not functioning we call it a dataquality problem, he said.

It would be very nice to have our own

system which says sorry your sensor is

wrong, youll have to stop your models be-

cause you cant trust them.

Michael Golan, Professor of Produc-

tion Engineering with NTNU Norwegian

University of Science & Technology, said

that it would be helpful to have systems that

would provide a quick view of what was

happening, to help people make quick deci-

sions because many decisions in thedrilling process are made very quickly.

Coffee time at the Trondheim IntegratedOperations conference


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Leaders


tion room. Thats a challenge, particularly

if you are an expert or have something im-portant to share, she said.

New people tend to hide outside the

camera angle because that seems safer, but

its not very good for trust, she said. If

youre collaborating with a group in a re-

mote site and someone in the remote group

suddenly starts talking and you didnt even

know they were there, it can be disconcert-

ing.

People often look at their own PC be-

cause they are at home there, rather than look

straight at the camera.

People with high technology literacywill speak a lot slower and wait for the mi-

crophone. If you are new to this, the tempta-

tion is to speak fast and quickly, she said.

Working on a shared surface also re-

quires skill. All people working on the screen

have controls to share the screen, but if they

all start moving the mouse and changing the

screen at the same time it gets tricky.

One problem is when conflicts start to

arise and people end up collaborating against

each other. We want a united meeting, she

said.When working together with other peo-

ple in different parts of the world, it is im-

portant to make yourself easy to understand

and use the same language other people do.

It is very important to focus on precise use

of new technology, she said.

When people used plenty of abbrevia-tions and local terms, IFE classified the be-

haviour as incompetent.

IFE also analysed group leadership be-

haviour. If the leaders were either passive

(doing nothing) or dominated the discussion,

their behaviour was classified as incompe-

tent.

More skilled people focus equally on

all participants both local and remote. In a

really good meeting the meeting leader will

evaluate the collaboration, she said.

Good leaders will ensure that final de-

cisions are agreed during the meeting not af-terwards.

There are still challenges with getting

everyone to participate, particularly when

there are groups from different parts of the

world involved.

Extrovert people are easier to train

than introverts. The only way to do that is by

encouragement and training the meeting

leader to involve people. Cultural diversity

is a huge challenge, she said.

Another problem is encouraging peo-

ple to develop new skills, when they are go-ing to lots of other courses already (training

fatigue).

You have to make it relevant to what

they do every day and avoid academic ex-

ample, she said.

Grete Rindahl, a senior researcher with the

Norwegian Institute for Energy Technology

(IFE), has been watching workers on the

North Seas Gja field collaborating remote-

ly and analysing how well it is going.

She was speaking about her work at the

Trondheim Integrated Operations conference

on September 28-29 2010.

The Gja field was discovered in 1989,

and operations will begin in November

2010. Partners in the field are Statoil, Shell,

RWE-DEA, Gdf Suez and Petoro (represent-

ing Norwegian government).Staff on the field have been organised

into multidiscipline teams, with some peo-

ple working offshore and some onshore, but

they come together regularly for collabora-

tion meetings.

The meetings use a common virtual

workspace with the workspace being sim-

ilar to one PC screen so it is like 10 people

working on the same PC screen at the same

time.

The great thing about collaboration is

that it enables many people from differentbackgrounds and cultures to work together.

But the diversity of people can make it hard.

These are diverse people with different

skills and attitudes, and they have to collab-

orate through technology, she said.

The technology and collaboration

rooms themselves do not make people col-

laborate that can only be achieved through

building teams of people, she said. Its very

difficult to understand IO without actually

doing it for a while, she said.

IFE set up a research project called

SOFIO (Structured observations with feed-back of IO interaction) to try to work out

how the collaboration was going and try to

help improve collaboration at Gja.

The researchers aimed to analyse peo-

ples mindset while engaged in collaboration

(if they understood the strategies and princi-

ples behind the collaboration); their technol-

ogy literacy (eg if they understood the im-

portance of sitting so they could be seen by

the video camera); the precision of their

communication (if the message sent is the

one which got received); and the teamwork.Also how well they work under pressure and

how they build trust among the groups.

An important factor is peoples technol-

ogy literacy. Some people can be visibly un-

comfortable when working in a collabora-

Are you competent in collaboration rooms?Grete Rindahl of Norwegian Institute for Energy Technology (IFE) has been researching how well people areusing collaboration rooms and what constitutes competent behaviour

The audience at the Trondheim Integrated Operations conference


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Leaders


Alan Lumsden, Professor and Medical Di-

rector, The Methodist Hospital in Houston,

talked about the similarities between medi-

cine and the oil and gas industry.

He was speaking at the Integrated Op-

erations conference in Trondheim on Sep-

tember 28-29, organised by Norges Teknisk-

Naturvitenskapelige Universitet (NTNU).

I work in the world of cardiovascular

disease. So do you you dont know it, he

said.

Houston is home of the largest medical

centre in the world, with 6,500 hospital beds.The two biggest businesses in Houston are

oil and gas and medicine. Yet there is very

little contact between the two groups, he

said.

Id be working on a PowerPoint on a

plane out of Houston and the person next to

me would say what are you doing.

We pick targets, drill holes, try to in-

terfere before pipes blow apart and interfere

after they blow apart every now and again.

People joke, next time I have a heart

attack filling up my tank someone will fixit.

But I dont get to see inside your

toolkit and you dont get to see inside mine.

People work in like and fundamentally dif-

ferent fields.

The Kimray Greenfield Filter, a filter

for a blood vessel, has been implemented

on hundreds of thousands of patients world-

wide, he said. It used some expertise about

filtering pipes developed from the oil indus-

try. Kimray was an oilfield engineer, he

said.

There has not yet been any use in themedicine of pigs robot devices which trav-

el along pipes

and assess their

interior condi-

tion. Could we

use something

similar in blood

vessels? he

asked.

The med-

ical industry

does have endo-luminal ultra-

sound, a device

which gathers

360 degree radi-

al images from

inside a blood vessel. It is fitted inside a

catheter (a tube which can be inserted into

the body).

The medical professional does have ex-

perience with 3D imaging, remote monitor-

ing, and managing large amounts of data, he

said.

Computational fluid dynamics is mov-

ing into medicine from oil and gas, he said.

The lining the inside of wells is almost

identical to lining the inside of body ves-

sels, he said.

The Methodist Hospital has run toursfor petroleum engineers through its medical

centre, he said.

As a result of one of these tours, one oil

company started research into using a Mag-

netic resonance imaging (MRI) scanner to

get a better understanding of fluid flow

through a gravel pack.

The medical profession could be very

interested in learning more about how the oil

and gas industry uses swellable elastomers,

because it might be possible to adapt the

technology to develop something which canblock body vessels.

Other technologies developed in oil and

gas which could be useful for the medical in-

dustry are battery technologies, visualisation

and robot steering, he said.

There is a huge overlap between both

of our industries. We have to begin to start

understanding theres a huge opportunity for

your knowledge to help our patients, he

said.

Both industries also have big chal-

lenges with regulators, particularly in the US

which often means that companies have todo medical research in other countries.

The mindset of typical oil and gas en-

gineers, and medical researchers, is also dif-

ferent, which can lead to different ways of

solving problems.

Better decisions at NATOMajor Dag Ola Lien from the Royal Norwe-

gian Air Force Academy, talked about his

previous job assignment in NATO, where he

worked with decision making as an Air

Weapons Controller on NATO AWACS, andhow the oil and gas industry could maybe

apply similar thinking.

Major Lien has flown with NATO for

over 1300 flying hours on NATO AWACS,

and now works with the Norwegian Air

Force on leader-

ship develop-

ment and co-op-

eration, particu-

larly around

NATO's flying

radar stations,

known as an

"airborne early

warning and

control system"

or AEW&C.

Like theoil and gas in-

dustry, the Air

Force tries to set

up Integrated

Operations, but our related term is Network

Centric Warfare, he said.

In the Air Force, the emphasis is on

speed - reducing time between making ob-

servations to decisions. "From detecting Tal-

iban to engagement by a fighter takes min-

utes. Time is critical," he said.

Fast decisions are critical during a mis-sion, a battle commander views everything

on a big screen and makes decision of where

to bomb. "But even if he made the fastest

decisions in his life - the person in the fight-

er or the AEW&C are saying 'hey come on

give us the clearance'", Major Lien said.

"The battle commander says, hey come

on give me some time. The perception of

time is different."

There are staff from 13 different coun-

tries working on the AEW&C. In most cas-

es, each individual mission ends up with a

new group of personnel, and they all need toget on running the operations straight away.

However, missions run by the RAF

AWACS flew with fixed crews on every mis-

sion, he said. "No-one can see that fixed

crews are fundamentally better than mixed

crews."

"A lot of effort is put into team build-

ing. We build up the soldier to be robust," he

said.

"Personnel are encouraged to give feed-

back. A fighter pilot can admit mistakes or

dangers, situations to his colleagues withoutgetting his head cut off."

It's a challenge to get people from dif-

ferent cultures, different "glasses" (how they

view the world around themselves) to work

together.

Lessons from medicine and military The oil and gas industry might be able to learn a lot from how medicine and military use integratedoperations, and have some expertise to share, said speakers at the Trondheim IO Conference

Major Dag Ola Lien fromthe Royal Norwegian AirForce Academy

Alan Lumsden, Professorand Medical Director, TheMethodist Hospital inHouston


10/24

Leaders


Torbjrn Forthun, managing director of

Kongsberg Drilling Management Solutions,

believes that oil and gas companies need to

develop more sophisticated ways of doing

business with drillers.

Drilling companies get punished if they

cause downtime, but they dont get any re-

ward for their efforts in keeping the drilling

as effective as possible, or the quality of the

uptime, he said. There is a need for change

in the contractual regime.Also, drillers companies are not chal-

lenged by their colleagues as much as per-

haps they should be. The rest of the organi-

sation is more or less accepting what the

drilling domain is claiming, he said.

Meanwhile, there has been a focus on

integrated operations, but it is mainly

geared towards being able to drill with less

people on the platform, rather than improv-

ing the quality of the relationship and find-

ing ways drillers and their customers can

gain value.Mr Forthun was previously responsible

for the integrated operations department at

Odfjell Drilling Technology, which was sub-

sequently acquired by Kongsberg Oil and

Gas Technologies in September 2010.

Marathon, Hydro, Statoil and Conoco

Phillips all worked with Odfjell on integrat-

ed operations.

Kongsberg is trying to integrate all of

the systems for planning and reporting into

one drilling suite, which can be used by both

drilling companies and their customers, so

they can collaborate together.For one customer, the integrated opera-

tions technologies enabled an oil company

to save $23.5m a year, although the invest-

ment in the technology was made by the

drilling company, he said.

Value at ShellShell has now implemented smart fields

technology at 50 assets around the world, in-

cluding in Brunei, Oman, Salinn (W

Siberia), UK, Nigeria, Gabon, Canada,

Netherlands, Norway, Sakhalin, said Fransvan der Berg, smart fields operations leader

with Shell.

The company quantifies value from the

project in terms of increased recovery and

financial savings it makes (such as from be-

ing able to develop fields cheaper or having

to purchase less capital equipment), he said.

One field in Brunei could only be de-

veloped using smart wells technology, be-

cause it was too complex to develop other-

wise, with hundreds of reservoirs faulted up.

On the Nelson field, Shell has a systemto optimise the gas lift, which enables it to

start-up operations in 18 hours instead of 24

hours after any shutdown, providing a whole

quarter day of additional production.

The company has learned that there are

very little benefits to smart technology if you

cant make any changes to the field as a re-

sult of the data you gather. Its no use know-

ing the water is going the wrong way if you

cant do anything about it.

With all smart fields projects there is a

challenge getting people to get enthusiasticabout them, when it is only one of a list of

priorities they have.

From a workers perspective if you

add another thing for them to do, theyre not

likely to do it. You have to take something

out, he said.

Making it work also means making it

relevant to the people and what will help

them. You need to choose which you im-

plement dont go for everything that seems

nice, he said. Training needs to be adapted

to the people. And it is the closest people thatthey have trust in that should deliver train-

ing.

Mr van der Berg said that the technolo-

gy is easy we can make it work. The em-

bedding is the hard work. The people are not

the problem the problem is created by the

fact that they need to change the way they

work. It creates resistance, he said.

Shell uses coaches in the early stage of

a project and runs regular reviews of how

well things are going.

PetrobrasCristina Pinho, E&P Operation and Mainte-

nance General Manager, Petrobras, talked

about Petrobras integrated operation man-

agement project, GIOP.

Frans van der Berg, smart fields operations leader, Shell and Cristina Pinho, E&P Operation andMaintenance General Manager, Petrobras

Developments at Kongsberg, Shell,Petrobras, Saudi Aramco

The Trondheim Integrated Operations conference on Sept 28-29 included new ideas from Kongsberg,

Shell, Petrobras and Saudi Aramco about how to get the most out of integrated operations


11/24

Leaders


The plan is to install GIOP at its off-

shore production facilities following a 4 year

plan running from 2009 to 2013.

We think communication is so impor-

tant we have a very structured plan to com-

municate, she said.

It builds on a research project, called

GeDig. In GeDig, we tried 6 different tech-

nologies, with pilots at 6 different compa-

nies, she said. Some of it didnt work at

all. We realised technology is not so impor-

tant. You dont need this fancy place to work.

People didnt understand.

GIOP is a natural evolution of other

projects, she said.

The complexity over the next two

years will bring new challenges. We have an

exploration area of 150,000km2.

We will increase production 42 per

cent in 2010 to 2014 from 2.1m bopd to

2.98m bopd, while the mature reservoirs de-plete 10 per cent a year.

This means there will be a lot of green-

field operations. Many people working in the

new integrated operations centres will be

new Petrobras employees.

Petrobras has become a partner of the

Centre for Integrated Operations in the Pe-

troleum Industry, a research centre which is

part of Trondheim University of Science and

Technology (NTNU).

Petrobras decided to join IO mostly

because of the experience here [in Trond-heim], she said. We are starting from

scratch and didnt want to make huge mis-

takes.

One of the biggest challenges at Petro-

bras s communication about IO to people

around the company at at managerial level,

she said. I thought it was easy to present

GIOP philosophy to the managerial level,

but some of them didnt understand. We had

to come back and do it again. GIOP is not

easy at all to understand.

We must have the managerial level

with us. Without them it will be impossibleto make it different.

Saudi AramcoMeshal Al Buraikan from Saudi Aramco's

Exploration and Petroleum Engineering

Computer Center, talked about how Saudi

Aramco has managed dynamic well tests.

Mr Al Buraikan says he personally

likes the following definition of intelligent

fields: Remote capturing and utilisation of

real time surface and subsurface data to op-

timise upstream assets and maximise itsprofitability.

Thats a definition I personally like.

Someone else in Saudi Aramco might give

you another definition, he said.

Mr Al Buraikan sees the evolution of

the system to do more and more things simi-

lar to how cellphones have evolved. The

cellphone started off with voice, now its an

entertainment centre, he said. There is a

network foundation.

The surveillance layer is where we

spend most of our time. That consumes

much of the budget, he said.

Normally for well tests, the well needs

to be shut in for 2-7 days, to monitor what

happens as pressure builds up. The data gath-ered during the well test needs to be filtered

to understand what is happening, because

otherwise it just seems to jump all over the

place.

If you get a flow rate data per second

the data is all over the place, he said. So

you apply a filter and get it back per hour.

Saudi Aramco had a project to reduce

the number of data points from 58,000 to

2,700.

It uses the Kappa Engineering Dia-

mant Master client server tool for reservoir

surveillance. It has been implemented on 13fields, with 1027 wells and 5092 gauges.

The challenges are data quality, stor-

age and access, he said. The problem is not

disk space but how to access it.

The software also helps to manage the

well tests in one example, Saudi Aramco

wanted to shut in 50 wells in a field at the

same time to see what happened.

Using IO for emergenciesCamilla Tveiten, a psychologist and re-

searcher at Scandinavian research organisa-tion SINTEF, has studied how integrated op-

erations could help with emergency manage-

ment.

This covers into risk anticipation, ie

how well people are aware that something is

about to go wrong, before something actual-

ly does go wrong; and the communication

while the emergency is being handled.

Ms Tveiten analysed 16 actual acci-

dents, and in 11 of them, We find deficien-

cies in anticipation of risk, she said.

Also organisations do not learn enough

from the accidents. Learning seems to be

not as it should be.

There has been a reluctance to talk

about how integrated operations can help

with emergency management, she said. It

has been a taboo in many ways. People say

IO is not about emergency management.

Emergency management needs to be left

alone.

In emergency management, sharing of

information plays a very crucial role, she

said.

We wanted to look at how new work

proceses and new technology can influenceemergency management.

Most people say in oil and gas, a cri-

sis doesnt come suddenly, it evolves over

many days.

Ms Tveiten suggested that companies

should put more effort into trying to antici-

pate risks, or emergencies which might be

about to occur. We suggest there should be

a more focus on spotting risk, she said.

In emergency handling, it can be im-

portant to manage the information flow.

Too much information is not good, shesaid. But if we put a lot of information in

the room it can turn to an information crisis

not an emergency crisis.

But in most emergency communica-

tions, most of the communication is by tele-

phone.

The sharing of information is quite lim-

ited, she said.

Meshal Al Buraikan from Saudi Aramco'sExploration and Petroleum Engineering

Computer Center

Sharing of information in emergencysituations is 'quite limited' - Camilla Tveiten, a

psychologist and researcher at SINTEF


12/240

Leaders


Jon A Fredrickson, vice president of sales

with InnoCentive, talked about his online

service which enables companies to post

challenges and give rewards for people

who do them, thereby enabling anyone in the

world to participate in their research. Re-

wards can be between $5,000 and $1m.

The service does not aim to replace

companies in house research departments,

but aims to provide them a route to alterna-

tive expertise, for example someone who has

tried a similar problem working for a differ-ent industry, or someone with a unique set

of ability and skills which the company does

not have with its in-house staff.

The name of the company posting each

challenge is not revealed on the website.

The oil and gas software company Par-

adigm posted a challenge on the site because

it wanted to find a better way to analyse 3D

fault data. Interestingly one of the Solvers is

a Swiss entrepreneur radiologist who had

been working out ways to look at bones in

3D. In one example, NASA (the North

American Space Agency) wanted to find a

better way of predicting solar events, and

posted the challenge on InnoCentive. The

award was won by a retiree who had previ-

ously studied solar flares for the telecom in-

dustry. NASA didnt know this guy was

there, and never knew this research had been

done, he said

In another example, the Oil Spill Re-

covery Institute in Alaska (OSRI) had a

problem with oil and water mixture from

spill recovery it was loading into barges,which was freezing and becoming impossi-

ble to discharge.

The solution came from an Illinois

chemist and nanotechnology expert, who

had knowledge of how large fields of con-

crete are kept fluid, preventing the concrete

from setting by using a long vibrating rod,

who thought the same method could work

for a frozen oil and water mixture. The

chemist won $20,000 and gave half of it

back to OSRI.

One chemical company which posted aproblem on the site received a successful so-

lution from an 18 year old undergraduate in

Kazakhstan, who won $25,000.

In a study done by Harvard, 70 to 80

per cent of the solutions come from people

some 2 to 6 degrees away from the normal

circle of talent the company would go to, Mr

Fredrickson said.

Of course, companies can always post

the challenge on their own websites, but the

value InnoCentive provides is to help com-

panies frame the question in a way that is

more likely to find a solution, and provide

ready access to a number of people who en-

joy complex technical or scientific problems,

Mr Fredrickson said. Additionally, the

added value of anonymity for a Seeker andthe inclusion of purchasing Intellectual Prop-

erty for the award posted for the challenge,

makes this model the fastest and most cost

efficient method for innovation in the world.

Mr Fredrickson said he was disappoint-

ed that the company was not invited by BP

to help try to come up with solutions to the

Deepwater Horizon disaster.

It ended up hosting online discussions

for its expert solvers to try to come up with

solutions anyway, even though no financial

award was offered. Our solvers wanted toshare their solutions and they wanted people

to listen, he said.

The solvers on InnoCentive were only

able to use data from the general media,

which was limited. They would have been

more likely to have been able to contribute

if it had more of the facts, he believes. Our

solvers love facts, he said. Temperatures,

conditions, flow rates along with other key

data was missing as we had no access to it

from BP or other sources.

BP tried to do organise its own system

for soliciting ideas and according to BP got40,000 submissions, he said, which must

have made it very hard to sift out anything

useful. The signal to noise ratio was out of

balance, he said.

If InnoCentive had been involved, they

could have framed the question better, and

got a narrower list of responses, more likely

to provide a useful solution and taking less

time to sift through.

As a specific example of people who

might be able to help, there could be people

who work in the nuclear industry with ex-pertise on containing radiation, which would

have been applicable to containing the oil-

spill.

Medical expertise could have been use-

ful. The CEO of a manufacturer of medical

equipment asked all employees to give sug-

gestions by applying what they knew about

valves, he said. They had interesting ideas

that came in.

Someone else who was looking at sen-

sor technology maybe have looked at it dif-

ferently, he said.

Another example of the strength of

crowdsourcing for solutions is the DARPA

(Defense Advanced Research Projects

Agency) challenge to find 8 feet diameterred balloons, where 10 red ballons were

placed in urban parks around the US, and

teams had to find them, for a reward of

$40,000.

The winner was a group from Massa-

chussets Institute of Technology, which cre-

ated a pyramid reward scheme for distribut-

ing the prize money, whereby the finder of

each balloon would get $2,000, and people

who connected people who found the bal-

loons with MIT would get $1,000, $500,

$250 and so on.There have been other challenges post-

ed related to oil spill recovery, including for

oil spill tracking, and the best way to fit ves-

sels.

InnoCentive understands that it is cru-

Innocentive crowdsourcing ideasUS company InnoCentive is helping oil and gas companies find solutions to technical problems byposting them on the web but it takes skill and organisation to get the right result. VP sales JonFredrickson explained how it works at the Trondheim Integrated Operations conference

Helping you find experts from other industrieswho might be able to you help you find good

solutions - Jon A Fredrickson, vice president ofsales with InnoCentive


13/24


14/242

Exploration


cial that the seeker gets engaged in the dis-

cussion, and takes the solvers seriously, and

is specific about what is needed. You need

a process to engage unknown experts some-

where in the world, he said.

Some companies find it difficult cultur-

ally to use solutions developed outside the

company, the well known not invented here

syndrome. Procter and Gamble went to steps

to change this culture within their organisa-

tion, saying projects should be labelled

proudly found elsewhere, he said.

The cultural issues are big, he said.

People say, culture eats strategy for lunch.

About InnoCentive, Inc.

Since 2001, InnoCentive has helped cor-

porate, government, and non-profit organ-

izations to better innovate through crowd-

sourcing, strategic consulting services and

internal Software-as-a-Service offerings.

The company built the first global Web

community for open innovation where or-

ganizations or Seekers submit complex

problems or Challenges for resolution

to a Solver community of more than

200,000 engineers, scientists, inventors,

business professionals, and research or-

ganizations in more than 200 countries.

Prizes for winning solutions are financial

awards up to US $1,000,000. Committed

to unleashing diverse thinking, InnoCen-

tive continues to introduce new products

and services exemplifying a new corpo-

rate model where return to investors and

individual passion go hand in hand with

solving mankinds most pressing prob-

lems.

www.innocentive.com

Using object databases for seismic dataObject databases can provide much faster results than relational databases, when you are trying to lookfor complex patterns and relationships within the data, as two major seismic companies have found out

Seismic interpretation and reservoir charac-

terisation company Fugro Jason, along with

another unnamed major seismic company,

have moved to using object orientated data-

bases to manage their seismic data, because

they believe it gives them faster results.

The database provider is Objectivity, acompany based in Sunnyvale, California.

One (unnamed) seismic research com-

pany has used the database for their data, to

run under their acquisition and processing

modules.

The database collects all of the sensor

data, including GPS, source and receiver po-

sitions, seismic response and node position,

and puts it into the Objectivity database.

The project development manager said

that the database was "perfectly suited to the

demanding data acquisition requirements".

Fugro Jason uses the database to man-age the data from different sources across its

geology, geophysics, petrophysics and mod-

elling applications. The company says that

analysis which once took days can now be

done in minutes.

The theory is that normal databases

(commonly known as relational databases)

are not very good at processing data when it

means finding complex relationships be-

tween the fields.

Relational databases are ideal for tasks

which involve putting data into a storage andtaking it out later. For example, a system for

managing plane ticket purchases.

But if a task is needed which involves

finding complex patterns and relationships

between data, then object orientated databas-

es can do the job faster.

For example, think of the way that

Amazon manages to trawl its database to no-

tice that several people who bought one

product also bought another one (a process

which creates 20 to 30 per cent of its rev-

enues).Or imagine a national intelligence data-

base, with large amounts of information, try-

ing to spot certain patterns very quickly.

If companies do not want to switch

completely from a relational database to an

object database, they can use the existing

database to store and catalogue the data, but

use Objectivity to analyse the relationships.

They can also create external processes run

on separate machines.

FasterObjectivity claims that when it compared itsdatabase with a leading relational database,

looking for connections between a number

of different objects with up to 5 degrees of

separation, the Objectivity database could do

it in 15 seconds, compared to 17 hours on a

leading commercial relational database.

Object orientated databases can also be

run over many different servers at once,

which is very hard to do with relational data-

bases.

Results are sent as they are found,

which means the end users dont have to waitfor the query to complete before they see any

results.

Relational data management systems

have no concept of relationships, he says

Thomas Krafft of Objectivity. In Objectivi-

ty databases, relationships are stored with

the data.

Also, most of the popular programming

languages today are object orientated, so

most programmers are familiar with object

orientated languages.

We've run tests internally showing

how a traversal of complex and deep rela-

tionships, finding connections between ob-

jects separated by 3, 4 or any number of de-grees of separation, can cause relational

databases to just fail. And even when they

don't fail, the response time is horrendous.

Helping seismic companies manage theirdata with orientated orientated databasesrather than traditional relational databases -Thomas Krafft, director of marketing,Objectivity Inc


15/2413

Exploration

January 2011 - digital energy journal

GeoGraphix, a Windows-based geological

and geophysical interpretation software line

will now operate separately to the Landmark

brand, and its product development will be

managed by a separate company called

LMKR.

GeoGraphix was originally an interpre-

tation software company, which was ac-

quired by Landmark in 1995. Halliburton ac-

quired Landmark a year later, and added the

GeoGraphix software to its portfolio as a

way to address the needs of small and mid-sized operators. Since then, it has operated

as a product line under the Landmark brand.

But from now on, GeoGraphix will operate

independently from Landmark under the

management of a company called LMKRs

management.

The software suite runs on everything

from commodity hardware, including lap-

tops, to high-end workstations.

It can be used as a standalone solution

in the field, or as part of a multi-user net-

worked asset team in the office.The company recently released a new

version (5000.0.2.0 release) of its Discovery

software in October 2010, including tools for

geomodelling while drilling and GIS map-

ping.

Independent OperatorsGeoGraphix was built to support small and

medium sized independent companies and

their workflows and weve been evolving the

technology to meet their needs, says

Richard Patterson, head of research and de-

velopment at GeoGraphix.These companies often are working in

fields which the majors have found to be un-

economical.

In order to be successful in these en-

vironments where margins are thin they need

to find ways to do things more efficiently.

Leveraging a software solution that re-

quires less IT infrastructure and support, and

minimizes the learning curve, can be a way

of doing this, he says.

With independent oil companies, the

person using the software could be the per-son buying the software; it could be the pres-

ident of the company. The technology needs

to be as easy to use as possible.

A lot of what you see reflected in the

product is a result of our close relationships

with these small and medium sized compa-

nies, he said. We worked directly with

them as far as defining and developing work-

flows, to help them get their jobs done faster

and easier, to get to first oil.

Independent operators also need to find

ways to do things cheaper than the majors.

Having less complex software packages,

which need less IT infrastructure and sup-

port, can be a way of doing this.

Theyre looking for solutions which

are more affordable so they can seek out theremaining reserves which the majors cant

afford to continue to work in, Mr Patterson

said.

Our goal is to provide the tools that

the geoscientist need to get their job done in

this high volume environment that were

moving into.

Weve got a lot of individual consult-

ants working with it on a laptop, they click

on the software and theyre up and running,

he said. The data they work on can be ei-

ther on the computer or on the server. Thereare a lot of customers using NetApp network

storage theyre storing the actual project

data on a network appliance.

Geomodelling While Drilling withsmartSTRATThe company has developed a new geomod-

elling while drilling tool called Discovery

smartSTRAT, a new add-on module to Geo-

Graphix Discovery smartSECTION soft-

ware.

It is designed to enable fast, easy and

accurate geomodelling while drilling formore precise geosteering of horizontal wells.

The company says they based this lat-

est feature on customer feedback and input

to cater to the new ways geoscientists and

engineers are collaborating to develop un-

conventional fields and drill horizontal

wells.

The increase in horizontal well drilling

in North America, along with a new factory

production method, demands a new way of

thinking and working resource plays, the

company says.As a direct result of close collaboration

with key customers, smartSTRAT was de-

signed and engineered to help geoscientists

effectively and efficiently execute factory

production style workflows for horizontal

GeoGraphix - software for independentsGeoGraphix, a brand of interpretation software geared towards the needs of independent oil and gascompanies (particularly working on land), is no longer part of Halliburtons Landmark software andservices portfolio

drilling and

total field

develop-

ment.

We

worked di-

rectly with

the geosci-

entists to de-

fine and de-

velop work-

flows to helpthem get

their jobs

done faster

and easier,

thus reduc-

ing time and

expense to

first hydro-

carbon,

says Mr Pat-

terson.

The unconventional workflows arevery demanding. You have to have tools and

workflows which are very repeatable and

lend themselves to a quick turnaround.

The horizontal well correlation work-

flow allows geoscientists to update the proj-

ect interactively in Discovery smartSEC-

TION with new picks, inter-well points and

revised drilling targets.

The resulting interpretations can be dis-

played in Discoverys integrated advanced

3D visualization tool and geomodel applica-

tion.

Technology: GIS MappingAnother new capability allows users to ac-

cess and display, in real-time, the most cur-

rent online GIS and ArcGIS maps and lay-

ers. These maps and layers can be visualized

both in 2D and in 3D interpretations.

According to GeoGraphix, a major

source of frustration geoscientists encounter

is the lack of access to the most up-to-date

mapping information.

The ability to stream maps ensures that

everyone working on a project is using thelatest map data since the latest maps are

streamed every time the project is opened.

Users dont have to worry about data dupli-

cation and issues resulting from manual in-

put and output.

Building interpretationsoftware to meet the needsof small and medium sizedindependent oil companies -Richard Patterson, head ofresearch and development atGeoGraphix


16/24

Production


I think the good people really like to be

challenged, says Jim Kochan, managing di-

rector of Vitesse Solutions LLC, a company

based in Cleveland, Ohio, which provides

knowledge management consultancy to the

oil and gas industry, with Conoco Phillips as

one of its biggest clients.

We all love to challenge and defend.

People can say I see what youre doing but

I can see a new idea of how to do this in a

different way.Thats kind of the environment that

my approach has always strived for.

This does not mean aggression, but just

setting up the right kind of conversational

discussion, which all participates appreciate

and all benefit from. The exchange of ideas

usually happens in a conversational note,

he said.

Experts rarely ask other people for help

because that makes them look like they dont

know what they are doing, and destroys their

power base in the company. It works muchbetter if it as seen as experts sharing tips with

each other, like golfers comparing their

methods in a bar.

Its not were doing this wrong, were

going to drop it, and do it your way. Its

youve just given me a couple of good

ideas.

Were all in the same ballpark, experts

are rarely off by that much. Experienced

people generally have 85 per cent of it, but

theyre looking for other peoples techniques

that may be useful or generate ideas.

Theres always a difference of opinioninto how things should go, if people are shar-

ing their opinions. But you are at least sur-

facing some good ideas, identifying cautions

or sharing experiences. It is similar to meet-

ings when people say ah ha! Im glad you

brought that up. Your approach might save

us something in terms of cost! Weve all

been in those kinds of meetings.

Your average expert actually loves to

talk and exchange about what they do with

other people who are knowledgeable. It

doesnt mean theyre asking questions aboutthings they dont know.

Comparing techniques is not showing

that I dont know something. Its sharing

what you know and having respect for other

people and what they know.

In a culture where people who do the

same type of work are in regular collabora-

tive contact with each other, they feel com-

fortable airing whats new, and what they are

working on. Exchanging ideas and plans and

techniques on a regular basis.

I think people who work on high risk

projects are kind of proud of the fact theyve

been chosen to work on a high risk project.

But you need pathways for those people to

share and interact with other knowledgeablepeople from other projects.

If youre all working together to say

...this is what were doing, ...this is what

theyre trying, ...weve had this vendor in...,

little by little, those things start to have a

positive impact.

Everybody would say, theres more I

dont know than I know. When were honest

with ourselves we all know that, he said.

Its about saying this is how were doing

things here how are you doing it there and

comparing notes.Mr Kochan cites the Kashagan Oil

Field in Kazakhstan, which is being operat-

ed by a consortium of 7 companies ENI,

Shell, Total, ExxonMobil, KazmunayGas,

ConocoPhillips and Inpex. Youre trying

to bring to bear the knowledge of 7 compa-

nies into the drilling operations of one of the

most complex operations in the world. Go-

ing in, do we really think that all 7 compa-

nies are collaborating bringing all their

knowledge to bear if they hadnt any mech-

anism to share? I dont know.

AssistanceCollaboration often starts when someone

asks for assistance, or someone has a sug-

gestion which they think would help some-

one else.

The mud experts on a rig could be say-

ing (to others around the world), heres what

were seeing.... People would start to re-

spond, and someone could say, we have a

small operation over here and we had simi-

lar readings, and we had a problem. Heres

the details of those problems ... and thensome productive discussion could ensue.

If people are already talking to each

other then it is more likely they will discuss

many concerns they may have. If the ques-

tions are arising (for example about mud

logs), mud

logs might

start to be

shared by

people who

feel the need

to share it

with each

other be-

cause the

communityhas fostered

that confi-

dence.

They

can discuss

this with

other mud

experts

around the

world, what

they are doing in their own operations. Peo-

ple say, well can you please send me yourmud logs, or where are your mud logs avail-

able on the system, point me to where your

concerns are. This exchange brings more

minds to more issues.

An experienced expert can say let me

look at your mud logs and Ill see if there are

some areas where we might be concerned.

In such a community atmosphere

theyre getting support for good ideas or

theyre getting questioned on things that they

may not be sure about. They say, maybe

wed better back off on this because other

people in the company are unsure.

Positive re-inforcementCollaboration has positive re-inforcement

loops as more people collaborate, more

people see the benefit of collaborating, more

people become comfortable collaborating,

more collaborating goes on, more people get

new ideas, or see improvmenets in produc-

tion or safety, leading to more collboration.

The more people that feel comfortable

jumping into a forum at any given time, the

more easily people feel about exchangingknowledge, he says. Theyre all going to

same place. Youre more likely to find peo-

ple who are willing to help or simply share.

If those people are more in tuned-in to

any situation you have less likely of a

Do you challenge your colleaguesenough?One of the signs of a successful collaborative environment is that people feel comfortable challenging

each other says Jim Kochan of Vitesse Solutions, knowledge management consultant to Conoco Phillips

Helping you makecollaboration work - JimKochan, managing directorof Vitesse Solutions


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chance for something bad to happen. You

sure do reduce the likelihood, he says.

In one example someone asked a com-

munity for advice about how to use a specif-

ic dangerous chemical in a certain applica-

tion. Other people in the community provid-

ed advice, and some people (who were just

reading the exchanges) became aware of the

risk for the first time.

Use the whole companyMost people commonly discuss things with

colleagues in their office, collaboration tools

can help people discuss with experts across

the whole company, worldwide.

When you have a giant corporation,

you have people all over the world who can

weigh in and debate things, and things get

better, he says. For example, lessons

learned on a gas turbine in Brazil can be used

in Alaska.Were always checking e-mail I

dont know anyone who doesnt check their

e-mail. People get on intranets and logon

every day. If youre checking on a global

community it only adds a few minutes to

every day, you can jump in or contribute to

dont have tools competing against each oth-

er, you have a well organised and well run

knowledge sharing process, you cant help

but engage the best minds, he says.

Organising your knowledge sharing is

a good idea. The more organised the ex-

change of knowledge, the more focussed it

is, the more likely that things are going to be

done better, negative things have a chance

of being avoided, and people have a little

more comfort level in taking responsibility,

he said.

Engaging with people in a virtual en-

vironment should be part of peoples day. Its

not easy to do at first. But once it happens

the benefits do start.

Posting data live on a corporate intranet

can help, but it is more important to get the

engagement working. Just because data are

available online doesnt mean people are

looking on it, he said.To support the discussions, it probably

is important to have data files accessible in a

standard online place to people in the com-

pany. There shouldnt be 50 places to store

documents, he said.

it. Instead of going down the hall and en-

gaging with 1 or 2 people, you can walk over

to your computer and ask your question to a

much larger group.

But even if remote colleagues are avail-

able and reachable with collaboration tools,

it doesnt mean that people collaborate,

when it can still be much more comfortable

to talk to people you are sitting next to.

We isolate ourselves geographically

often, because of time zone, language, dis-

tance, for the most part its a lot easier to

stand up and walk down the hall and ask

someone, who may not be an expert but they

might know enough to get you through the

day , he says.

ToolsTools dont make the collaboration work, but

the collaboration ceretainly cant happen

without the right tools used in the right way.When things are done right, when the

processes are put in place with some of these

wonderful tools, like Sharepoint and

Wikipedia put in with proper guidance, with

leadership, business case, resources, transfer

processes, specific expectations, and you

Yuck! Technical detailsIf you want to get people interested in the digital oilfield, youve got to get them interested in thetechnical details something people normally dislike, writes Dutch Holland

Straight out of the dictionary, Yuck is used

to express rejection or strong disgust.

Yuck is the reaction that technical read-

ers often have when encountering informa-

tion that appears to be overkill.

However, beware of the Yuck factor if

interested whatsoever about todays fast-

spreading concept of the Digital Oilfield

(DOF).Yuck. Why should anyone bother to

read about such an arcane topic as DOF en-

terprise architecture at the strategic level?

The answer is simple: DOF as a new

technology, and article readers as its propo-

nents, are not likely to go far in producing

results for their company (or brownie points

for their annual performance evaluation)

without a business foundation for DOF at the

right level.

Otherwise, regardless of top manage-

ments verbal go ahead signals, DOF maycontinue as little more than an expensive cu-

riosity. That is the unvarnished bottom line.

Even with agreement that a strategic

foundation is important, what can anyone do

about it, especially if they are not at the

strategic level. In fact, those connected to

DOF in any way can do a lot about it through

executive education, patterned after Chinese

water torture.

Every time anyone talks, presents or

discusses moving DOF forward, they talk

about DOF Enterprise Architecture.

However, if that term will presumably

Yuck out top management, then talk aboutcritical success factors for DOF or known

pre-conditions or lessons learned or

whatever it takes. Sometimes a copy of a rel-

evant article can be very helpful.

Past the Yuck? Enterprise ArchitectureWhen an upstream organization decides to

go for it to maximize digital technology

utilization for business value, the enter-

prises architecture must be altered and con-

figured specifically for digital technology.

To translate, when an upstream compa-ny decides to make DOF adoption a higher

priority for the enterprise, goal statements of

Senior Managers must be re-configured to

include specific business goals to be gained

by using digital technology.

Must

be re-config-

ured? Yes, be-

havior goes

toward re-

wards, not to-

ward words.

Strategic,workprocess,technicalprocess

In the first of

this series of

articles, DOF

Enterprise Ar-

chitecture (DOF EA) was described as a

combination of three different structures that

must be aligned and integrated to maximizethe business potential of digital technology.

Strategic Business Architecture in-

cluding the companys DOF vision and

strategic goals, measures and incentives

Work Process Architecture includ-

- Dr Dutch Holland,Holland ManagementCoaching


18/24

Production


ing the matrix of technical and business

work processes needed to achieve DOF

strategic goals

Technical Process Architecture in-

cluding the processes inside the IT or R&Dorganization to manage digital resources

Strategic Business ArchitectureFive organizational elements must be

aligned by senior managers to get DOF into

full play: Company vision, goals and strat-

egy for DOF, Executive commitment to

DOF, Incentives for Results from DOF, Ro-

bust portfolio management and Explicit de-

cisions for DOF Implementation.

1. Company vision, goals and strat-

egy must explicitly reflect the companysintention to adopt Digital Technology for

improved business results.

Someone once said Never underesti-

mate the power of the written word. That

must be a given or organizations would not

consume so many trees in writing Vision,

Strategy, Values, etc. and the other informa-

tion produced to guide organizations.

It is not necessary to include in goal

statements that offshore platforms will be

utilized for production because that is not

new. But, using digital technology to make

better decisions about production is new, both to many organizations and to many

managers who may have been making pro-

duction decisions the old fashioned way.

The key point is that failure to include

the desire for exploitation of digital technol-

ogy in the writings of top management can,

and will, lead to confusion about how seri-

ous the company is.

2. Executive commitment to DOF

must be shown by investment in DOF ar-

chitecture and by willingness to use pro

forma results in financial projections.Imagine a company which builds a new

production platform off the west coast of

Africa. What are the chances that anticipat-

ed production would be omitted from future

earnings projections for the company? The

answer is zero because man-

agement is fully committed to

making that platform pay off

for the investors. The same is

true for DOF projects.

What if millions were

committed to DOF projects to

improve decision-making

without mentioning that in-

vestment and its anticipated

earnings in the companys fi-

nancial projections? Would

that be read as a lack of com-

mitment or a lack of knowl-

edge of the impact the DOF

projects should have on the

business? Either way, failure to show antici-

pated financial results is a DOF killer.

3. Incentives must be in place to

motivate DOF exploitation. Archimedes

said, Give me a lever long enough, and afulcrum on which to place it, and I shall

move the world. Such is the power of the

lever.

In organizational terms, incentives are

the equivalent of the lever. What anyone

wants, they describe and then incen-

tivize. Or, to use an old phrase, Put their

money where their mouths are. Failure to

explicitly incentivize the exploitation of dig-

ital technology at multiple management lev-

els will result in much less than what could

be called a full-court press.4. Robust portfolio management

must be in place for all capital investment

decisions including DOF. Regardless of a

companys size, only so many dollars can

be devoted to new, whether fields, plat-

forms, pipelines, technology or DOF.

Those scarce dollars are allocated by top

management using their process which

has probably developed over time.

The issue is that the use of allocation

process from the past is not likely to put

DOF investment opportunities into the same

bucket of dollars for allocation. Potential in-vestment in DOF can be only a derivative of

another budget category such as Information

Technology (IT). Failure to explicitly put

DOF opportunities into a head-to-head eval-

uation with other investment opportunities

usually results in under-investment in DOF

given its business potential.

5. Explicit decisions to Deploy or

Give Permission to Adopt must be made

and communicated for each DOF initia-

tive. Although this may be hard to believe

it is true, because managers in almostevery company often still treat invest-

ments in IT dollars differently than their

other investments.

For example, if top management funds

the construction of a new production facility

for the Gulf of Mexico, they would not have

to call in the GOM asset manager and say:

The company is investing big bucks in the

GOM platform and we expect you to use it

to make money for the company. Can you

imagine the look on the GOM Managers

face when he hears that? What did you

think I would do?

Yet, when dollars are invested in DOF

initiatives, top management actually does

have to sit down with managers and tell them

that very thing. Failure to have that direct

conversation will stop a DOF deployment

by a given date and sends the signal that us-

ing the new DOF technology is optional.

All or NothingFail to complete one category of organiza-

tional reconfiguration at the strategic level

and the end result will be greatly disappoint-

ing from both an operational and economicpoint of view.

As the list below indicates, if one key

ingredient of strategic architecture is miss-

ing, the results are considerably less than de-

sirable.

Missing a formal DOF strategy leads

to confusion

Missing executive commitment leads

to project having low priority for action

Missing management incentives

means its all talk, no action

Missing portfolio management meansminimal investment

Missing decision to deploy means

slow and partial use.

The Yuck TestThose having an interest in DOF, and those

who read this entire article, have passed the

Yuck test and are players. That passage de-

livers an unfair advantage over others who

say they want to max DOF performance.

Now, on to the other three articles in this se-

ries -- with real chances to stretch ones lead.

More informationThis is the second article in a five-part se-

ries that defines and explores the ways an

upstream organization would need to be

re-configured to fully adopt the use of dig-

ital technology to improve the business.

Articles in this series will look at the

adoption of digital technology from a

number of angles: Strategic business,

work process, technical process and ven-

dor [email protected]

Tel: +1 281-657-3366

www.hollandmanagementcoach-

ing.com/digitaloilfield


19/24

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Software for oil industry real estateMany oil and gas companies could benefit from a more structured approach to facilities and real estatemanagement, writes Phil Wales, CEO of Houston-based eBusiness Strategies (www.ebiz-strategy.com)

It may be surprising to discover that man-

agement of the oil and gas industrys col-

lectively vast real estate and facilities

(RE&F) is a breed apart from the rest of

their companies technologically.

To an outside observer, this would

seem almost incomprehensible when look-

ing at the scale of services offered and size

of the Real Estate & Facilities Capital Ex-

penditures (RE&F CAPEX) and/or Opera-

tional Expenditure (OPEX) budgets.

However, in comparison to operating

units, this cost is relatively small and lacksthe focus prevalent in other industries.

Most real estate services in oil and gas

companies have originated as discrete

functions within individual business units

and evolved in silos. This not only applies

to day-to-day operations of these groups,

but also to their enabling technologies.

The impact? These disparate growth

patterns have resulted in each organization

supporting their real estate activities dif-

ferently and rarely focused under an enter-

prise-wide approach.Consequently, with no standard ap-

proach or centralized direction, oil and gas

#28 Digital Energy Journal - Jan 2011

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Transcript of #28 Digital Energy Journal - Jan 2011