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.
The 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) |
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.
Each 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. |
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.
Recommended Reading
NOV's AI, Edge Offerings Find Traction—Despite Crowded Field
2024-02-02 - NOV’s CEO Clay Williams is bullish on the company’s digital future, highlighting value-driven adoption of tech by customers.
TechnipFMC Eyes $30B in Subsea Orders by 2025
2024-02-23 - TechnipFMC is capitalizing on an industry shift in spending to offshore projects from land projects.
Flame Acquisition Holders Approve Merger with Sable Offshore
2024-02-14 - The business combination among Flame Acquisition Corp., Sable Offshore Holdings and Sable Offshore Corp. will be renamed Sable Offshore Corp.
SLB’s ChampionX Acquisition Key to Production Recovery Market
2024-04-21 - During a quarterly earnings call, SLB CEO Olivier Le Peuch highlighted the production recovery market as a key part of the company’s growth strategy.
Talos Energy Expands Leadership Team After $1.29B QuarterNorth Deal
2024-04-25 - Talos Energy President and CEO Tim Duncan said the company has expanded its leadership team as the company integrates its QuarterNorth Energy acquisition.