Integrating the Intelligent  Oilfield

The  Intelligent Oilfield (IOF) is not a one-size-fits-all solution. Part one of this  three-part series defines the IOF and looks at the business case for it.  

By Jon D.  Krome, John R. Matson and Greg Mitchell; IBM Global Business Services  

The dynamic and  dramatic evolution of the oil industry continues. It was a mere 10 years ago  that the industry was feeling bloated with staff as energy demand provided only  cautious optimism for the future. Only 20 years ago, personal computers were  introduced into the workforce. At that time, the production engineer’s only data  source was to be found on an operator’s clipboard or in a stack of old, daily  reports found in a file cabinet in someone else’s office. It took weeks to route  an Authority For Expenditure (AFE) for any type of well or facility work.  Planning, scheduling and implementing a simple workover took weeks to months.  

he work and  workplace continue to change. Competition for hydrocarbons has driven companies  to explore and produce in harsh and remote locations, where even the simplest  logistical tasks can be difficult, dangerous and costly. As the environment  grows more unforgiving and the challenges more complex, skilled technical  resources are becoming scarce. New projects bring more risk, which, in turn,  requires a greater quantity and quality of data from which to learn.  Importantly, the information and communication technology that supports (and at  times drives) the industry has dramatically improved. These factors have set the  stage for use of the IOF.

The IOF  defined

Frequently  captured data, distributed, evaluated and acted upon in real time forms the  basis for any IOF approach. Also known by many of its synonyms (the Digital  Oilfield, Field of the Future, i-Field, e-Field, Real-time Operations, and  Real-time Optimization), the IOF can reduce the uncertainties of the looming  “great crew change” and ever-increasing project complexity. And, the IOF holds  great promise for a future of higher productivity, increased recovery, lower  costs and reduced health, safety and environmental exposure. 

Figure 1. The  IOF is composed of five key components, encompassing people, process and  technologies. (Graphics courtesy of IBM)  

 The IOF is  composed of five key components, encompassing people, process and technologies,  which need to be addressed for any IOF vision to be truly realized (Figure 1).  

Addressing  each of these five components reduces the risks of sub-optimization and  confusion, and even complete failure. Similar to links in a chain, the ultimate  success of a project demands that each component contribute to the overall  strength of the project.

Temptations to  reduce the IOF to merely an automation project or a remote operations and  collaboration room with plasma screens limit the greater benefits that can be  achieved. Projects that are considered to be related to the IOF can be diverse,  yet they all share the common theme of frequently captured data, distributed,  evaluated and acted upon in real time.

Consider an  automation project that gathers wellhead data and controls the plunger lift  cycles. An additional, related IOF project is the high-bandwidth, wireless  network that distributes the data into a real-time historian that stores and  manages the data. Add an integration approach such as Service-Oriented  Architecture or middleware that allows all the necessary systems and  applications to share the same information — creating “one source of the truth.”  Layer in an improved workflow that can leverage the real-time data and the new  behaviors to collaborate and act on the information. This is an example of a  comprehensive IOF.

ach  application, solution or project above represents one of the five components,  and is a part of a larger IOF approach. As the number of individual efforts,  projects or components grows larger, the need for rigorous integration between  the projects as a cohesive program grows more critical.

 Business case  for the IOF

 The path to the  IOF vision may take years (particularly in mature or brownfield legacy  environments) and can be tortuous. Some have heralded IOF as the “next big  thing” in the oilfield, and it certainly can provide a powerful set of tools and  approaches. Yet, there remain few examples of IOF implementations-at-scale, and  even fewer that can show sustainable results. Therefore, it is timely to ask  fundamental questions regarding the business value, implementation lessons, and  possible future directions of the IOF.

Though not a panacea, the IOF can address many of the current and  future issues facing the upstream industry. An IOF implementation should be  tailored based on the exact nature of the need and the status of the current  state. In other words, there is a large probability that no two IOF programs  will look alike as there are no two wells in the world that are exactly alike.  Figure 2 displays a sampling of upstream issues and how an IOF approach may  address them.  

Figure 2. A sampling  of upstream issues and how an IOF approach may address them.

The IOF  approach is not new — most large integrated oil companies developed their own  real-time drilling support centers years ago. These early centers were the  analogy to today’s production-related central collaboration environments. They  relied on streaming data from the rig, though little of it came from the drill  string or bit. The intent was the same as it is now: provide full-time,  real-time technical support for time-critical operations; use as learning and  development experiences; provide additional safety assurance through video  surveillance and use as a best practice sharing vehicle. But as valuable as the  centers have been, they had a limited life span (though many companies are  re-vitalizing their real-time drilling centers in addition to developing  real-time production support centers). Today, the technologies have changed, and  workforce demographics have been slowly shifting, and the demands for real-time  approaches are more varied.

A key lesson is that  a real-time center existed for as long as the need for real-time support  existed. What requires real-time support is the degree of immediate risk,  exposure, or opportunity, such as an exploration well in a frontier area, or the  deeper completion in a new horizon, or monitoring the high-rate oil well in  deepwater (Figure 3). When considering an investment in elaborate support  centers or building a comprehensive IOF strategy, oil companies should consider  the criteria in Figure 3.  

Figure 3. When  considering an investment in elaborate support centers or building a  comprehensive IOF strategy, oil companies should consider these criteria.    

As  petrotechnical professionals, we can all sense the potential value of an IOF  approach — it is technically sound and reflects our collective experiences. That  said, the obvious question remains — why the apparent slow uptake? Part of this  perception is related to the high expectations for the IOF. Once defined and  theorized, impatience has grown even in the midst of the significant work that  continues to occur in older fields. It is now commonplace to find Programmed  Logic Controllers (PLCs) and Remote Terminal Units (RTU) in the brownest of  fields — a small signal that the IOF is reaching more than just the high-profile  locales of deepwater. Other reasons can be traced to generically slow uptakes of  many technology-led approaches even though the IOF relies on as much people and  process changes as it does on technology. But the foundation of the  slower-than-desired deployment is the large need for integration between the  five components (refer back to Figure 1). This integration crosses many  organizational and departmental boundaries, demands a reflection of current  governance structures and distributes the benefits and costs over many different  groups of users and administrators. In an atmosphere of dreadfully low prices or  extremely high ones, these issues have not carried the same gravity as the other  issues of the day.

Part two of  this three-part series will examine how the people and process aspects of the  IOF, defined as the People & Collaboration and Workflow Optimization  components in the IOF framework, affect the benefits and costs for an IOF  program .