Getting smarter

OE Staff

August 1, 2016

Could we on the verge of embracing the industry 2.0 era? Intelligent energy, or the digital oilfield, is set to be discussed in Aberdeen next month. We take a dip into the debate.

Image from iStock.

The opportunities around implementing intelligent energy (IE) technologies are quite vast and the potential just as significant for the oil and gas industry.

Be it automation in the drilling sector or unmanned facilities remotely operated by an integrated operations organization or better use of data analytics to improve production and maintenance efficiencies, many are keen to extoll the possible virtues of so-called smart systems or the digital oilfield.

But it seems like it has been so for quite some time. Could we finally be on the verge of embracing the oilfield 4.0 era (or even 2.0?), forced by low oil prices and a need to do things different?

Some certainly think so, even in the mature North Sea basin. “The current low oil price environment makes re-defining how we work, establishing new roles and centralizing analysis and decision-making even more imperative,” says Mark Edgerton, an asset manager for Chevron for the North Sea Alba asset.

The benefits of adopting intelligent energy tools include real-time production optimization, improving the efficiency of reservoir surveillance and management, through integrating real-time data with advanced engineering technologies, Edgerton says.

Advanced statistical algorithms help enhance understanding of major equipment performance, improving reliability, run times and production efficiency. Data analytics is also increasing the efficiency and effectiveness of maintenance and integrity management.


In its simplest form, IE can help streamline work through repeatable processes, he says.

“All of these areas have a common theme that highlights the importance of connecting the right people to the right information to improve decision-making and reduce cycle time – which, in my opinion, will have the biggest business impact,” he says.

So, what has hindered us in the past? We’re working in a complex industry, with companies focused on managing safety, operational and financial risk, Edgerton says. “This can create a natural conservatism in implementing change.” Change also takes time, he says.

Commercial and business models are not necessarily aligned to adopting IE, says Helen Gilman, VP within Wipro’s energy, natural resources and utilities consulting practice.

“Developments in digital and other technologies are delivering opportunities for us to be more integrated in the way we work, but our commercial and business models are not evolving as rapidly as the technology,” she says. Both Gilman and Edgerton will be speaking at this year’s SPE Intelligent Energy conference, held in Aberdeen in early September. OE is a media partner of the event.


The industry has been making in-roads, however. Chevron, for example, has been working on its own digital oilfield program, i-field, for more than a decade. It was pioneered in the North Sea and US, with roots in production engineering and operations but with a “transformation philosophy that enhances and optimizes operating processes,” Edgerton says. No doubt Chevron has even more up its sleeve.

Other areas where the industry has already adopted these technologies include in more efficient collaboration, improved data access and visualization and workflows, says Gilman, who has co-authored a paper looking at how to accelerate uptake of IE technologies. But, there’s agreement more could be done, including within the drilling sector.

Drillfloor automation

Introducing automation into the drilling segment remains a slow process. Fionn P. Iversen, PhD, Chief Scientist, International Research Institute of Stavanger, is presenting a paper at SPE IE on the topic and, with his co-authors,* set out the main reasons why the drilling segment has been slow to adopt automation.

The primary factor was industry fragmentation, he says. “We have multiple types of companies (operator, drilling contractor, service company, equipment supplier, etc.) and multiple drilling areas that each operate in (such as MWD/LWD, drill bit, motors, drill string, surface systems, instrumentation, etc.). By their past history, companies tend to compete in these areas, so we have different companies providing the same measurement, and the same services based upon that measurement. Therefore, it made business sense at that time to build proprietary systems, which unfortunately now hinders adoption of the open systems required for IE.”


But, there’s also a lack of understanding about what data and information is required, he says. “Advanced IE services exist, but are challenging to use, due to insufficient available information.” In other words, there needs to be sufficient instrumentation to detect the state of the operation and then appropriate and accurate measurements to provide sufficient reliability of model prediction and process optimization for the operation in question.

Furthermore, IE use depends on open digital communications, which a company might perceive as a threat to its constructed barriers. “For drilling systems automation, SPE’s Drilling Systems Automation Technical Section’s (DSATS) first proposal was to adopt Object [Linking and Embedding] for Process Control Unified Architecture (OPC UA) as an open communications protocol. That proposal was about six years ago, yet only now are we seeing emergent OPC UA systems for drilling (OE: March 2015). The adoption rate is low, in part because existing companies prefer to operate behind barriers.”

There’s also a lack of a technical roadmap, he says. “For any business to commit funds to developing and supporting systems automation, it has to see the long-term strategy within the industry,” Iversen says.

Systems engineering also needs to be addressed. “Practices are really not employed in the drilling industry at the level one would expect,” he says. “Systems engineering within silos does occur, but systems engineering does not occur at an industry level. It is therefore difficult to build a vertical model that is automated from the wellsite to the enterprise level.”

Finally, it’s about metrics and how you can measure the impact of IE on drilling. “The ultimate goal of IE is, possibly, to develop a systems engineering approach to drilling, and then one has to measure KPIs (key performance indicators) representing adherence to optimized constraints. This means information sharing between multiple companies, which is difficult in a fragmented industry operating within silos.

“This is a multi-level scheme that has been proposed by various authors,* based on ISA-95, that is applied to various industrial manufacturing enterprises. Essentially drilling optimizes to a series of constraints. One example would be allowable equivalent circulating density (ECD), which depends on the operating window, bounded by fracture pressure and pore pressure – a KPI would be how well this ECD is maintained. Another might be allowable tripping speed at hole depth, which varies depending on the allowable margins between surge and swab speeds and fracture and pore pressures respectively.”

DNV GL’s Solitude concept. Image from DNV GL. 

Unmanned movers

Another area of intelligent energy focus is removing people entirely from the work site, with completely unmanned facilities, could also be a way the industry works more smartly in the future.

“Removing people is a fundamental principle of inherently safer design,” says Peter Boyle, a leader within the UK risk advisory group of DNV GL. “This in turn produces additional design, weight and cost savings.”


Boyle says that an aversion to risk, the race to be second, has impaired the oil and gas industry’s ability to innovate in this area. But, the “brutal wake-up call” of the oil price slump, could open the door to more use of intelligent energy technologies, such as integrated operations, or IO, where platforms are operated remotely.

He says using a clean sheet and an objective driven design is the way forward, not working from the last best design and tweaking it. Also, concepts needed to be included as the feasibility study and concept selection phase to ensure that operations perspectives are clear and included in the commercial framework for a project.

As an example, DNV GL has developed the Solitude concept – based on an unmanned FLNG installation.

While the tough LNG market might not see Solitude come to market in the near-term future, the concept has been widely embraced by the industry, Boyle says. What’s more: “Many elements of Solitude can be implemented independently and some are already available,” he adds. “For example, operators control subsea installations and simple, fixed offshore installations from shore. With continuing advances, unmanned offshore installations are a natural development.”

Indeed, this type of activity is already happening in the subsea sector, where minimal intervention strategy is being pioneered, Boyle says.

“In other industries, such as automotive, the use of data sensors to determine effective service activity is gathering pace, while further disruptive technologies in the form of the Google car will further step change IO use,” he says.

What next

Gilman says that new technology start-ups could help inject some innovation into the oil and gas sector. But, she says that it’s also about existing players and those looking to take on IE technologies working together differently.

For Edgerton it’s quite simple: “IE technologies help us enhance our understanding of complex systems and to optimize them. Reducing complexity helps overcome one of the biggest barriers to changing business performance. IE solutions are a methodology, not a goal, and remembering this will help as companies look to deploy tools and apply new concepts to improve the business.”

* J.L. Thorogood, Drilling Global Consultant LLP; J.D. Macpherson, Baker Hughes; R.A. Macmillan, National Oilwell Varco.