Industry leaders agree on potential of intelligent energy

Collaboration was on the minds of two industry leaders this week at SPE's Intelligent Energy Conference in Amsterdam. Helge Lund, president and chief executive officer (CEO) of StatoilHydro, and Andrew Gould, chairman and CEO of Schlumberger, shared their thoughts on the need for greater cooperation among companies and industries if digital technologies are to be advanced in the oilfield.

"I believe the potential of intelligent energy is only being realized, and as the oil and gas industry is becoming more complex, we will need more investment in technology and more collaboration," Lund said in a joint press conference with Gould. "A major part of my company's strategy has been on technology development through collaboration."

Gould agreed. "As a company, Schlumberger does a number of collaborative research projects with many oil companies, but the one company with which we have the largest number of collaborative projects is StatoilHydro."

These projects have spurred Schlumberger on to invest heavily in Norway, Gould continued to explain. "Over the past 30 years, Norway has been a huge microcosm of companies advancing new technologies. In fact, Norway now ranks third in terms of R&D for us, mainly because of the number of small technology companies we've bought, and then we've moved our own R&D activities into Norway to complement them. It has become a great place for us to develop and test new technologies."

Lund added that the need to develop new digital technologies for the challenging operating environment of the North Sea prompted the need for collaboration. "The Norwegian North Sea has been a stimulating environment in which to invest in R&D, new technologies and the kinds of processes we're talking about at this conference."

Both company leaders gave specific examples of how digital technologies such as fiber-optic connectivity, web conferencing and new reservoir modeling could positively impact the production and processing of unconventional hydrocarbons like heavy oil, which will become a greater part of the energy mix over the next 30 years.

"One of the governing economic factors in producing shale gas like at Barnett is the production volume at each well, which is tied to how effectively you can fracture [frac] the well," said Gould. "You have heard of hydraulic fracture monitoring, measuring the seismic events taking place during a frac job to understand the progress being made. Up until recently, the results of the seismic events have been given to the customer after the hydraulic fracturing job. We have started doing real-time hydraulic frac monitoring, meaning that the reservoir engineer can see the seismic events while the frac job is going on. He can then change the fracture on the fly based on the results he is seeing."

"More generally, StatoilHydro has observed that the recovery rates that you are able to achieve is very dependent on when you can start enhanced oil recovery [EOR] activities, and putting the company's best knowledge towards this as early as possible," Lund added. "By using collaborative digital technologies, I think we will be able on a global basis to put a recovery plan together as early as possible, ensuring that more oil is recovered. This is very important for heavy oil fields as well."

While they expressed a great deal of optimism regarding the collaborative opportunities that intelligent energy holds, both men realized that there are hurdles to overcome. "We now have plenty of technologies that are digitally enabled and now, the change in the processes is more complicated than the technology itself," Gould said. "There is also a generational gap between the more experienced oilfield worker, who did not grow up with computers, and the younger generation who is very familiar with gaming, social networks and so on. As the technology becomes more widely integrated into the industry, I think the younger generation will be able to use these technologies much better than the older generation."

For Lund, "I think the development of a culture of collaboration has to come from a company's leadership. A leader needs to cultivate this, rewarding people for sharing information and best practices. It is the way you are in terms of trying to knit together different disciplines. I think the oil and gas industry has a way to go in this initiative."

A company's internal process systems can also be a hurdle, but Gould believed that certain software technologies could help streamline these systems. He pointed to a Schlumberger software platform developed in Norway as proof. "This geological platform allows a team to run all manner of different software processes. This platform moves away from the traditional silo mentality and allows the geoscientist, geologist, and reservoir engineer to all work with the same data set. It is a huge step forward in efficiency, and it has been quite remarkable to see the customer implement it and then see the efficiency they can introduce into their processes."

In terms of developing more technologies like this, both men pointed to a need to look beyond the petroleum industry to industries like aerospace. "In addition to managing its supply chain well and getting vendors involved in new projects at inception, the aerospace industry is using some really interesting technologies, and the development cycle is much shorter than in our industry," said Gould. "Our industry needs to be better at this, and adaptation of technologies from outside industries is a much better way to bring new advances to the industry rather than trying to invent them from the ground up. Some of these technologies could have far-reaching implications for us, it is just a question of making them rugged enough to deploy in the oilfield."

According to Lund, his company will be a willing volunteer to jointly develop and test some of these technologies from outside the oilfield. "Our industry is moving so quickly that we have to be open-minded about working closely with our service providers like Schlumberger. We have to not only share best practices, but also learn from others. I sincerely believe that StatoilHydro is no better than the strength of the partnerships in which we are taking place around the company."

Ted Moon is the Technology Editor of JPT Online. He brings information on emerging technologies, R&D successes, new field applications, updates from SPE papers about recent innovations, and more. If you have a question or suggestion for future article topics, email Ted at teched@spe.org.