‘

Outlining the History of Digital Oilfield (DOF),

Integrated Operations (IO) and Collaborative Working

in Oil and Gas Over The Last Decade

Stuart Carnell – StepChange Global

Control Room Design & Operation

Conference – March 2014

Our expertise

• an unrivalled resource in the application of Integrated Operations (IO) and digital oilfield enabled capabilities

• working with the leading companies in the field

• programmes, projects and pilots

• expertise from within oil and gas companies

• associations with leading institutions

• expertise in building ‘capability platforms’

• people lead management of change

• people that have expertise across the entire value chain

• subsurface, surface, projects, operations, LNG, mining

our clients - oil and mining companies

Integrated Operations, Strategy and Implementation and

IO for Projects, implementation of new operational models

Advanced Collaborative Environment Expert Strategy for

Aberdeen based assets

Strategy for application of IO to Brownfield redevelopments

and marginal Greenfield projects

Integrate Operations centre design and IO advisory services

Australian Operations – Brisbane GLNG and EABU

Collaborative Environment Strategy and Pilot

IO Operations Implementation Strategy for the Goliat Field

IO Strategy support for the Operations of the future program

IO internal training workshop for senior managers

our clients - oil and mining companies

Operations IO strategy and IOC centre design for APLNG

based in Brisbane

IO strategy support for the Western Australia business unit

Design of the IROC control floor layout in the new office

building in Perth

Corporate IO strategy – Support and advisory services to the

corporate IO Programme office

IO Strategy advice workshop for the Indonesian regulator

and operators

IO benefits study and value capture framework for the

ADCO North East Bab Asset

Full IO strategy plus IO centre design for operation, drilling

and subsurface

IO Strategy support and IO Centre design services for the

Woodside Browse iOps programme

‘Integrated Operations’

Integrated Operations – is seen as the future and the way of optimising the oil and gas business

Flow Assurance Analysis

Surveillance and Control of Subsea Production Systems

Umbilical and Flow line Monitoring

Drilling and

Completions

Production optimization

Condition Based monitoring

IWIS

Real-time Data And Visualization

Collaborative working (CWEs)

Remote Operations &

Management

Knowledge Management

Production Excellence

Reliability and Maintenance

Operations Excellence

Reservoir Management

Integrated Planning

Environmental

Monitoring

Major Projects

Asset Integrity

Intelligent Completions

Well Optimisation

i-Field, Digital Oilfield, Smart Fields, Integrated Operations ..what does it all mean?

fieldofthefuturetm

Smart Field

XM2010

‘Integrated Operations’

Integrated Operations

Integrated Operations

GEDIG

i-Value

Value Realised in Oil and Gas • Production Efficiency – 0.5 – 5%

• Operations and Maintenance

– Opex Cost Reduction 5-15% Standard Industry figures

• Drilling and Well Planning

– Reduction in NPT – 5-15% reduction in total well time

– Concurrent Planning – Well planned < 2 weeks

– Improved well targeting and reservoir contact

• HSE

– 25% Reduction in offshore staff by Statoil

– Risk Reduction – Operating Envelope

• Brownfield – Field life extension by the application of IO

• Projects

– No IO Design being offered by EPC Contractors

– Brownfield learning bolted on to a greenfield

Senior management sees Integrated Operations transforming our industry

“Integrated Operations is a revolution that is reshaping our industry”

– Helge Lund – StatoilHydro – iE2008

“All new fields will be intelligent fields”

– Amin Nasser – Saudi Aramco

“I expect the use of Smart Technology to accelerate over the next decade”

– Malcolm Brinded – Shell – iE2008

“Our Operations Centre in Aberdeen monitors 28 rigs simultaneously”

– Andrew Gould – Schlumberger iE2008

“We have gained 85 mboed of production at $3-6 per boe”

– Dave Latin – BP Digital Energy Conference 2009

Shell Benefits from Smart Fields SPE - 128245

Reported in 2010

• Up to end 2009

• Based on $30 boe

• Entire SmartField

Programme

BP FotF and ACE Implementation SPE 128672

What is Integrated Operations?

‘The vision for the Digital Oil Field is one where operators, partners,

and service companies seek to take advantage of improved data and

knowledge management, enhanced analytical tools, real-time

systems, and more efficient business processes’

CERA: Digital Oil Field of the Future

What is enabled by an IO?

• Moving to a real time or near real time way of working

• Connection of one or more remote sites or teams to work together

• Moving to more multidiscipline way or working

• Value chain integration and optimisation

‘How we run our companies in the future’

Drivers

• Discoveries in increasingly

remote locations

• Key skill shortages

• Increasing technical nature of

new discoveries

• Performance Improvement

• Production efficiency

• Reservoir recovery

• Operational cost base

• High or Low Commodity Price?

• Risk reduction both HSE and

Production.

• Value chain integration

Enablers

• High bandwidth

communication

• Large storage capacity

• Quality video conferencing

• New sensor technologies

• New Analytical Methods

• New Business Processes

• New SCM Models

• New Operational Models

• New Organisational Models

Drivers and Enablers for Integrated Operations

The History of Integrated Operations has shown the following trend Value gained over time

Value

Time

Technology

Physical

Environment

• The Technologies are all available?

• Technology is the enabler

• The design of the Physical Environment can be done

Value

Time

Technology

Process

Physical

Environment

• Process Workflows need to be updated

• For the reduced decision making cycle time

• For alignment of geographically remote communities

• Temptation is to ‘fix the processes’ roll out

• Experience has shown that this approach is only partially successful

• Work processes in Collaborative Environments evolve!

The History of Integrated Operations has shown the following trend Value gained over time

Value

Time

People

Technology

Process

Physical

Environment

• A people approach to MOC is the key to success

• A process only approach to MOC will not work!

• If your people are not aligned with your management

vision it will not be a success, top to bottom

• Need to work with all levels in an organisation

The History of Integrated Operations has shown the following trend Value gained over time

Value

Time

People

Technology

Process

Physical

Environment

Organisation

Micro

• The micro-organisational structure needs to follow the value opportunity

• Multidiscipline teams are needed to optimise

• Geographical boundaries become irreverent

The History of Integrated Operations has shown the following trend Value gained over time

Value

Time

People

Organisation

Technology

Process

Physical

Environment

Organisation

Micro

Macro

• The Company or Macro Organisational model will need to

support the change in the way of working

• There are global opportunities

• Optimisation of the extended Oil/Gas Value Chain

• Support functions need to be operationally aware

The History of Integrated Operations has shown the following trend Value gained over time

An Integrated approach

Value

Time

People

Organisation

Technology

Process

Physical

Environment

Organisation

Micro

Macro

Integrated approach to MOC is

needed For a successful company

wide implementation of Intelligent Fields

Concept and a move to a ‘Global Real

time Organisation’

Capability Deployment rather

than technology implementation

Integrated Operations - A Capability Approach

‘By a capability we mean the combined capacity and ability to plan and execute in

accordance with our business objectives through a designed combination of

human skills, work processes, organisational change and technology’*

A Capability is a performance improvement methodology that is value

driven, measurable and action oriented. To have the ‘Capability’ to improve

business value you must have all of four key elements in place:

Process – What is the core value process and underlying

processes that is to be improved and updated

Technology – What technologies are needed to improve the

process

People/Resource – What skills, competencies and behaviours are

needed to execute the process and use the supporting technologies

Organisation/Governance – What organisational structures,

incentives and relationships are needed to execute the process

* Henderson and Kulutilaka 2008 – Boston University School of Management

The measurement to decision lifecycle

Store Measure Data

Transmit

Building Trust

Building Confidence

Building

Understanding

Implement Decision

Obtain Value Analyse

Improving Operational Excellence

IO elements for Success

Highest

Cost

Highest

Value

Change, Leadership, Training

Decision and Action

Organisation and Governance

Collaborative Working

Information Analysis

Information Visualisation

Communications Infrastructure

Data Capture and Storage

Value Creation

Work Process

Shared Situational Awareness

Shared Knowledge

& Situational Awareness

• Quality Real Time

data/information

• Mutual Understanding

- Shared Mental Model

• Trust

BreakEven

Throughput

Time

OperatingTarget

DesignLimitOperational Safety Margin

Loss

Shut Down

Profit

Partial Shut Down

Plant Upsets

Lost Opportunity

Where the Money is:

Eliminate the Red ………..

……….. Squeeze the Green

BreakEven

Throughput

Time

OperatingTarget

DesignLimitOperational Safety Margin

Loss

Shut Down

Profit

Partial Shut Down

Plant Upsets

Throughput

Time

OperatingTarget

DesignLimitOperational Safety Margin

Loss

Shut Down

Profit

Partial Shut Down

Plant Upsets

Lost Opportunity

Where the Money is:

Eliminate the Red ………..

……….. Squeeze the Green

Measurable Improved Performance Synchronised Action &

a Reduced Cycle Time

Observe

Action

Decide

Analyse

Capability to Add Value

• People

• Process

• Technology

• Organisation

‘to know what is going on so you can figure out what to do’.

Situational awareness A definition of situational awareness is:

• “If you have a function to perform in a situation that is fairly complex and

dynamic, such that you have to make decisions, then you have to be aware of

what is going on—at different levels—if you are to make the right decisions to

achieve your goals”.

A simpler definition of situational awareness is:

‘to know what is going on so you can figure out what to do’.

There are three steps in the development of a team's shared situational

awareness.

• Build individual situational awareness.

• Share individual situational awareness in order to build a shared mental

model from the individual mental models.

• Develop the group's shared situational awareness. This is the integration

of the different individual mental models of the situation.

…its about collaboration…

Drilling & Well

Maintenance Equipment

Maintenance

Production

Reservoir Geology

Logistics

Well Planning

…between disciplines, across business units, with suppliers and locations

• A new way to organize an operation

• Collaboration between people, across disciplines,

companies and places

• Truly integrated Multidiscipline teams

• Distribution of internal & external information

• and knowledge

• Better use of scarce resources

• A dynamic organization

• Distributed real time working

• Has reduced decision time and improved decision making

• Is the way you add value from Integrated Operations

Collaborative Environments

The focus and value of IO is in moving towards real time decision making and optimisation

Mins > Hours Hours > Days Days > weeks Weeks >

Months > Years

Timescale of Work Process

CE

Key Processes Well Optimisation

Production Optimisation

System Optimisation

Drilling Performance Optimisation

Defect/Fault Resolution

Maintenance and Eng Support

Level 1 ‘Near Real

Time Team’

• Support to CE

• Located close to CE

• Asset Based Team

• Multidiscipline e.g.

Res Surveillance.

• Dedicated Resource

Short Cycle Time

Level 2

‘Support Team’

• Discipline Based Eng

Functions

• Assurance

• Shared Asset

Resource

• Located farther from

CE

• Maintenance

Planning

‘Support Functions’

• HR, IT,

• Eng Mods & Changes

• Shared Resource

• Located Remote from

Collaborative

Environment

Level 1 Support

‘Real Time Team’

• Real Time Data

Enabled

• Real Time Decision

Making

Plan Implementation Short Term Planning Long Term Planning

Technology Plans etc…

Integrated Field Planning

Real Time Optimisation is Core to CE environments

Collaborative Environment Success Factors

• The ability to Collaborate

• One to One, One to Many, Many to Many

• Always on VC to build situational awareness

• Full time occupancy of the rooms – The entire asset team is involved

• Modes of working

• Planned and execute

• Synchronised way of working

• Organisational Alignment

• Team organisation needs to be aligned to Collaborative way of working

• Often a move to multidiscipline Asset Teams

• One team approach i.e. team in the field and the office the same team

• Performance incentives for the teams need to be aligned

• Change management and coaching to change the way of working

A network of Collaborative Environments build a vision of a new way of working

34

Integrated Organisation – Fully Integrated Asset Management

Benefits:

• Increased availability

• Reduced maintenance costs

• Guaranteed performance for known through life cost

• Long term benefits for both operator and supplier

• Optimised processes and organisational structure

• Value driven organisation wide decisions

• Understand interdependencies

Changes enabled by Integrated operations

Before With IO

Serial

Single discipline

Dependent of physical location

Decisions based on experience data

Reactive

Parallel

Multidiscipline teams

Independent of location

Decisions based on Real-time Data

Proactive

A big change to the way we work

Conclusions

• The vision of a ‘new way of working’ is beginning to be

realised in many companies

• It is about Distributed Real Time Working

• There is significant proven value in Integrated Operations

• Technology is the enabler but Consideration of People,

Process and Technology a key to success

• IO is very Company, Culturally and Organisationally specific

• The vision is how we tie together IO Projects

• IO is fundamentally changing the way we do business in Oil

and Gas

• Integrated Operations is how we will run our companies in

the future

Integrated Operations – is a framework to optimise the other business’ – Mining

Real-time Data And Visualization

Collaborative working

Remote Operations &

Management

Knowledge Management

Production Excellence

Reliability and Maintenance

Operations Excellence

Water Management

Integrated Planning

Environmental Monitoring

Asset Integrity

Energy Management

Product Quality

Production optimisation

Event Management Expert Support

‘

Stuart Carnell

stuart.carnell@stepchangeglobal.com

+61 419 169 232

Questions