Category Archives: Management and Information

New M&I technical director Cindy Reece shares her top three goals for 2012

I am very honored to serve as your new Management and Information (M&I) Technical Director. Many thanks to Kamel Bennaceur for progressing this technical area and for his service to SPE as the former M&I Technical Director.

I plan to use this space as a blog area to keep you apprised of what I’m focusing on in M&I. I will be updating it on a monthly basis. In this first post, I share my top three goals for 2012.

Goal 1: M&I Understanding and Challenge Identification

The M&I area is very interesting one. It encompasses many topics that cut across the traditional disciplines of Reservoir, Drilling, Facilities, etc. In talking with members, I find that this area is not well understood. This will be one of my early goals to better establish an understanding of M&I with the membership and to identify what key challenges need to be addressed.

Goal 2: Digital Energy – What’s Next

Digital or intelligent energy has emerged as one of the newest areas within M&I. Through the leadership of some key SPE members, this area continues to change the way oil and gas is found, developed and produced. The time is right to reassess our SPE strategies in this area to ensure we help the industry achieve optimum benefit from these new capabilities. To that end, we have two initiatives ongoing. First, the Digital Energy Technical Section has chartered a team to reassess their strategies and charter. Second, the Technical Directors have identified Data to Action (D2A) as one of three Hot Topic Technologies that are being assessed and addressed holistically from an SPE delivery perspective. This is a joint effort between Ahmed Abou-Sayed, the Production Operations Technical Director, and me.

Goal 3: Petroleum Engineering (PE) Faculty Challenges

Our industry faces challenges attracting, developing and retaining PE faculty. Over the past year, I have been involved with a special SPE task force that identified these challenges and made recommendations to the SPE Board to recognize faculty with monetary awards in three areas: 1) demonstrating teaching excellence, 2) providing research seed funds to junior faculty and 3) encouraging students to pursue academic careers. The Board approved these awards on a pilot basis and we are currently forming award committees to make awards in the coming academic year.

I welcome your input, feedback and assistance to help progress the M&I area. You can contact me at

Trends in Monitoring: How to Use Real -Time Data Effectively

David Pritchard, Successful Energy Practices International, Jesse Roye, Digital Oilfield Solutions, and J.C. Cunha, Ecopetrol America

Real-time data is not about well control, it is about well control avoidance. Recent catastrophic blowouts have underscored the value of real-time data and, more importantly, they have also underscored the value of having the right kind of experience to understand well data interpretation in real time.

What is the well telling us? How do we use real-time data to ensure a stable wellbore? Real-time monitoring integrated with rigorous total well control analysis is required to embrace and achieve continuous improvement and ensure the safest possible environment. Next generation monitoring requires a step change that includes hazards avoidance as a precursor to drilling optimization.

Real-time data can be used effectively to avoid, minimize, and better manage drilling and completion operations. They can also provide the foundational support to improve training in the industry as well as develop hands-on simulators for hazards avoidance.

Read the entire article in the January 2012 issue of JPT.

Building a “New Normal” on the Bedrock of Risk Management

Martin Craighead became president and chief executive officer of Baker Hughes on 1 January 2012. He joined the company in 1986 and has served in various engineering, operations, managerial, and executive positions throughout North America, Latin America, and Asia Pacific. Craighead was named chief operating officer of Baker Hughes in 2009 and was appointed president in July 2010. He earned a BS degree in petroleum and natural gas engineering from Pennsylvania State University and an MBA from Vanderbilt University.

Historically, our industry has been driven by a series of inflection points to re-examine best practices, technologies, or philosophies on how we conduct our business. The most notable of these have often been associated with tragedies such as the 1988 Piper Alpha disaster in the North Sea and, most recently, the Macondo disaster in the US Gulf of Mexico. Piper Alpha led to a wide-scale focus on health, safety, and the environment (HSE), fundamentally changing the way companies viewed safety, and led to orders of magnitude improvement in HSE practices. While the full impact of Macondo is only now being fully understood, it is clear that we will see a similar effect on the way we handle quality, competency, safety critical systems, and contingency planning.

In both of the incidents, external pressure precipitated the cultural or technical shift to a new operating norm, while the capabilities and technology for bridging the gap were available. Until we consider risk management and operational sustainability as business drivers and an equal part of our mission, we will never make the paradigm shift from a reactive to a proactive business model.

The industry’s goal should be an incident-free environment, but government regulation alone will not help the industry achieve that goal. The reservoirs our industry is targeting are more challenging, the environments are harsher, and the technology required is ever more complex. As an industry we must be willing to go far beyond what is regulated—we must fundamentally change the culture of our business to address risk management in our processes, our technology, our talent management, and our safety programs.

Consistent processes and procedures across our business are the foundation for this change. A common operating system not only ensures that we meet regulations in all areas where we work, but also establishes repeatable performance that takes us far beyond what is required. Generally, there is one best way to perform an activity, whether it is solving problems for our customers or developing new products and technology.

Read the entire editorial in the January 2012 issue of JPT.

Can Geoscientists Resolve the CCS Paradox?

International energy and climate organizations have found carbon capture and storage (CCS) to be a promising technology to resolve the squeeze between fast-growing global energy needs and global warming. Even environmental organizations say that making our energy use more efficient and building enough new renewable energy capacity takes too long. We need to get the CCS working to curb the growing greenhouse gas emissions if too large a climate change is to be avoided.

CCS consists of three major interdependent steps:

  • Capture the carbon, CO2 out of flue gases, either from the stack of a power plant or the blast furnace top gas in iron making.
  • Transport it by pipeline or ship it underground.
  • Safely keep it in a storage site for thousands of years.

The technology for each of these steps has been used for decades in the industry, mostly in oil and gas. The important change is the scale–from about 100,000 to 1 million metric tons per year in the past. Today, we see the need for handling 10 million tons in each installation and for perhaps several thousand installations. The amount of CO2 produced from one power station varies from 2 million to 10 million tons; a modern iron-making blast furnace emits up to 10 million tons per year. The costs of the technologies for a large-scale CO2 handling chain are estimated to be split roughly 75%-10%-15% for capture-transport-storage.

Read the entire article in the December 2011 JPT.

Tore A. Torp is adviser for CO2 storage at Statoil, leading the storage part of Statoil’s research and development program (R&D) on CO2 capture and storage. He joined Statoil in 1984 from the steel industry. Between 1984 and 1996, he led large international R&D cooperation projects developing complex offshore field technologies. Since 1997, he has been project manager of Statoil CO2 storage R&D projects. He was vice chairman of the CSLF Technical Group, and was a lead author of the IPCC Special Report on Carbon Dioxide Capture and Storage. He received a PhD in material sciences from Norwegian University of Science and Technology.

SPE Economics & Management: October 2011

View the October 2011 issue of SPE Economics and Management.

133044-PA – Valuation of Swing Contracts by Least-Squares Monte Carlo Simulation
B.J.A. Willigers, SPE, Palantir Economic Solutions, S.H. Begg, SPE, University of Adelaide, and R.B. Bratvold, SPE, University of Stavanger

147910-PA – Optimization of Equity Redeterminations Through Fit-for-Purpose Evaluation Procedures
Paul F. Worthington, SPE, Gaffney, Cline & Associates

125178-PA – Improving Allocation and Hydrocarbon Accounting Accuracy Using New Techniques
R. Cramer and D. Schotanus, Shell Global Solutions; K. Ibrahim, Brune Shell Petroleum; and N. Colbeck, Hess Corporation

146530-PA – Demonstrating Reasonable Certainty Under Principles-Based Oil and Gas Reserves Regulations
R.E. Sidle, SPE, Texas A&M University, and W. John Lee, SPE, University of Houston

154056-PA – Unconventional-Natural-Gas Business: TSR Benchmark and Recommendations for Prudent Management of Shareholder Value
Ruud Weijermars, Delft University of Technology, and Steve Watson, Ashridge Business School

SPE Economics & Management: July 2011

View the July 2011 issue of SPE Economics and Management.

148542-PA – Discretization, Simulation, and Swanson’s (Inaccurate) Mean
J. Eric Bickel, SPE, and Larry W. Lake, SPE, University of Texas at Austin; and John Lehman, Strategic Decisions Group

134811-PA – Stochastic Analysis of Resource Plays: Maximizing Portfolio Value and Mitigating Risks
Paul D. Allan, SPE, Portfolio Decisions International

130089-PA – Survey of Stranded Gas and Delivered Costs to Europe of Selected Gas Resources
E.D. Attanasi and P.A. Freeman, US Geological Survey

134237-PA – Qualifying Seismic as a “Reliable Technology” — An Example of Downdip Water-Contact Location
R.E. Sidle, SPE, Consultant; and W.J. Lee, SPE, Texas A&M University

127761-PA – Probabilistic Modeling for Decision Support in Integrated Operations
Martin Giese, University of Oslo, and Reidar B. Bratvold, SPE, University of Stavanger

144490-PA – Moving the Energy Business From Smart to Genius by Building Corporate IQ
Ruud Weijermars, Delft University of Technology