HOUSTON—Technology has only begun to scratch the surface in the unconventional sector of the oil and gas industry, especially considering a revolution from digital analytics to automation is imminent.
A panel of senior technology leaders, comprised of operators and service providers, shared this sentiment at the Unconventional Resources Technology Conference on July 23. During the discussion, the panelists honed in on technologies that would make a difference in unconventional reservoirs.
Expanding on the topic, Concho Resources Inc.’s (NYSE: CXO) vice president of geoscience and technology, Chris Spies, said the industry has only really witnessed the top of the glacier when it comes to technology.
“From my perspective, the amazing thing about watching unconventionals grow over the last five years is that there hasn’t been a real breakthrough in technology and there hasn’t been a major leap in innovation,” Spies said. “It’s just all these little tiny tweaks.”
Spies went on to compare the tech revolution to a living, breathing organism that is on an “exponential learning curve and it’s not stopping now” adding that the downturn a few years back was actually a positive set up for the industry.
Hege Kverneland, corporate vice president and CTO at National Oilwell Varco’s (NOV), agreed with Spies.
Because of the downturn, Kverneland said that oil companies steered away from new technologies and systems that were introduced by service companies at that time since they were making money anyway. Service companies like NOV, she said, lost more money and workers than oil companies.
Despite not listening before, Kverneland said oil companies are more receptive now.
“Implementing new technologies is much easier to do now than it was three to four years ago, so that’s the good part [about the downturn],” she explained.
Serving as the moderator for the panel, Greg Leveille, CTO at ConocoPhillips (NYSE: COP), asked what specific trend would carry the industry another leap forward.
Without hesitation, Kverneland said “automation in general” was the next big game-changer.
Even for a driller in a drill cabin, she said, they still do very manual work such as lifting pipe, running pipe, starting pumps, connecting pipes and drilling into holes. This repetitive process, she said, could all be automated.
“[Automation] can make it into a process so that the driller can push a button [that performs these tasks] so that the drilling machine is doing it all for him and he can now pay attention to his group, and more importantly, to what’s happening downhole,” Kverneland said.
She asserted that although drilling has already had many advancements, automation will come more and more into play.
“I’m amazed that we’ve done so much for so long without actually having this [automation],” she said. “It’s like driving a car with a blindfold, and now we’re taking that off so we can drive that car much faster.”
Impact On Workers
But with the work place being digitized, what does this mean for workers in industry?
Chris Cheatwood, CTO and executive vice president at Pioneer Natural Resources Co. (NYSE: PXD), said people hate change. Since the transformation is inevitable, he said, people and company leaders will have to come on board to avoid being left behind.
“You have to understand that and embrace it and you have to bring the people into the process. They’re a part of developing these new things,” he said. “You can’t just say we’re going to do this and here’s how we’re going to do it. That won’t work. You have to bring them in and make them a part of that change.”
Cheatwood said that bringing people into the process is actually the first step to moving into the new way of operating.
Yanni Charalambous, vice president and CIO at Occidental Petroleum Corp. (NYSE: OXY), agreed with Cheatwood’s point highlighting that machine technology can’t replace every worker. In fact, he said people are needed to oversee and somewhat teach machines.
“Your job’s not in jeopardy,” Cheatwood said. “But, we can’t work the old way.”
Concho’s Spies added that introducing tools and concepts actually inspires ingenuity from workers.
“People will blow your mind with what they are able to come up with and being a part of that and embracing it makes the transition a little easier I think. It’s not a bad thing,” Spies said.
Kverneland pointed out the importance of attracting the younger crowd. From her perspective, she said she has seen many young people come into the industry. Because of this, she said there shouldn’t be any fear that active workers will retire with all their knowledge without passing it down.
“I’m very optimistic about the future of this industry. But, that also means that we need to start introducing new technology, we need to operate autonomously and we need to monitor what’s happening without necessarily going in there.
“[And] we still need people that can teach machines. You cannot do everything remotely.”
Mary Holcomb can be reached at email@example.com.
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