How is Industry Finding the Next Generation of New Technologies?

A ConocoPhillips-operated drilling rig in the Eagle Ford Shale, where the Houston independent is dramatically reducing its average drilling time per well. Source: ConocoPhillips.

A leaner era in the oil and gas industry has necessitated both quicker deployment of new technologies and created an environment less hospitable to investing the time and money needed for such projects.

Operators have reconciled this fact by high-grading their technology portfolios and relying more on collaboration to find new solutions. ConocoPhillips is currently working on approximately 100 projects developing new technologies, a drop from a few years ago when higher oil prices supported broader development, said John Hand, the company’s technology program manager, during a recent panel discussion at the SPE Gulf Coast Section’s inaugural Innovation Entrepreneurship Symposium.

In addition to Hand, the panel brought together representatives from a service company and a technology research consultancy to share how the industry is ushering in the next generation of advancements. ConocoPhillips incubates technology internally—mostly software-based—but also utilizes third-party firms ranging from big service companies such as Halliburton to small innovation companies, Hand said. While the operator prefers technologies that have evolved to near the field trial stage, in some cases it participates in the earlier phases and provides venture capital.

As a result of its continued—but refined—emphasis on technological development, ConocoPhillips has expanded the scope of what it previously thought was possible in the field, he said. For example, the operator is in the process of shrinking its average drilling time per well in the Eagle Ford Shale of South Texas to a week from about a month, far surpassing its initial expectations. Hand said when the operator initially reduced its time from 26 days/well to 21 days/well, “we were patting ourselves on the back” and saying, “I don’t think we can do much better than that.” Now, ConocoPhillips is averaging 12 days/well, “and we’re getting it down to 6 days.”

Offering further perspective on drilling-time advancements, Robert Nipper, founder and chief executive officer of service firm NCS Multistage Technology, noted that “it wasn’t really 21 days to 12 days—it was more like 50 or 60 days to 12 days over time.” Four years ago, “a really, really long, challenging lateral was 5000-ft-long—a 1-mile lateral—and we were wondering, ‘How in the world are we going to be able to frac these long laterals.’” Now, the industry is fracturing 2-mile-long laterals, he said, because the industry learned and implemented new technologies quickly despite difficult market circumstances.  

ConocoPhillips has also bolstered its exploration work through development of its compressive seismic imaging technology, which cut the company’s streaming costs by 50% while improving seismic quality, Hand said. He explained it “basically borrows from the medical industry where you pixelate a picture and basically fill in” the gaps. “Traditional seismic is shot with very regular grids. With compressive seismic imaging, you do some analysis upfront and identify where's the best place to put your receivers.”

In the Kuparuk field on Alaska’s North Slope, where harsh conditions limit operations, it previously took ConocoPhillips three winters to shoot seismic over the entire field, he said. “Now with compressive seismic we can shoot an entire field in one season.” The company this year is beginning to apply the technology to unconventionals to see if it can yield similar results. ConocoPhillips also worked with a Houston innovation company on laser technology that has been tested downhole in plugging and abandonment work in the North Sea, including at the Ekofisk field.

Figuring Out Big Data

Nipper said NCS customers are most concerned with ways to better exploit their reservoirs and increase estimated ultimate recoveries while reducing their operating costs. But, given the sheer amount of activity in unconventionals these days, there is almost too much data to digest, Nipper said. “Companies are at different stages: Some companies are still trying to clean up the data or get better data so you don’t have garbage in, garbage out. Some companies are trying to figure out how to store the massive amounts of data. And some are companies are trying figure out, what do I do with it when I get it?”

NCS is collecting terabytes of reservoir data per day alongside operational data that is about 25% of that size. “We collect at least five different unique data streams on every job that we do. We’ve got almost 10,000 wells of data that we’ve been collecting over time.” But that data has only been used in the past to help reduce nonproductive time for customers. Nipper said NCS really needs to have automation where “a machine can go in and actually see trends for improvements that we aren’t even aware of right now.

“With the number of frac stages that we’re completing in a year in just the US alone, if we could save 10 minutes per frac stage, that would be about 4800 hours. That’s 13 years of savings that we would have from saving just 10 minutes. So these small, incremental changes” would make a big difference, Nipper said.

Hand credited much of ConocoPhillips’ recent drilling successes to its integrated data warehouse, which combines and curates the company’s drilling data from throughout a play into a centralized data store that can be accessed by a drilling team. He noted that operators collect tons of data, but many lack the time and capability to figure out what it’s telling them. “And I think that’s going to be huge going forward because unconventionals are a big data problem,” he said.

“If you do want to continue to drive efficiencies, and if you do want to try and identify areas in which you can apply new widget technology or new technology techniques, you need to be able to understand what the data is telling you.” Hand said numerous service companies with which ConocoPhillips is working “are spending a lot of time on writing algorithms to automatically clean data,” which will save engineers time. 

Operators Ultimately Drive Innovation

Nipper said contractors “really need to talk to the customers to find out what the problems are and what they want to solve instead of developing a technology and hoping they’ll come. Our experience has been that customers are very willing to fund technology developments if they have the confidence that you can” solve their problems. He cited NCS’s work with operators that were looking to reduce development costs in challenging environments, including one completing wells on Alaska’s North Slope and a consortium developing fields in the Norwegian North Sea.

Hand said, “I think one of the problems for service companies and innovators is, how do you get face time with the operators and how do you know exactly what their problem is to solve?” His company participates in industry forums, including the Plugging and Abandonment Collaborative Environment (PACE) network, that bring together operators and service companies to identify technologies that can applied broadly in different parts of the world.

He noted that governments of countries such as the UK and Norway provide strong support for startups, with outfits such as the recently formed Oil & Gas Technology Centre in Aberdeen bringing together operators, service companies, and startups to explore and promote new technologies. ConocoPhillips’ Norway business unit conducts “technology days” where it identifies needs and invites startups and innovators to participate in a forum.

Operators are also enlisting consultancies such as Darcy Partners, which scouts emerging technologies on behalf of more than 30 exploration and production companies. Essential to Darcy’s work is a guidance from operators, which “cannot be replaced by anything else,” said Hossein Rokhsari, a partner at the firm. That guidance allows Darcy to outline the challenges faced in the field as well as the top issues that need to be solved. Comparing those challenges across multiple operators gives Darcy the insight to determine which new technologies the industry currently craves most.

Rokhsari reiterated that resources remain scarce for operators, meaning their capacity to develop technologies is smaller. “So if you find a technology that works or claims that works, where has it exactly worked? If it’s worked in the Permian, would it work in a gas field in the Marcellus?” Did it work “because it’s a statistically significant data point or not? And can we get comfortable putting this technology now in front of another 40 operators?”

Rokhsari said he’s excited about the prospect of collaboration across the industry as similar lessons are being learned across different basins. He asked, “Do you really want every operator to go and do a $3-million pilot project” to get the same answers? An operator “can’t do more than a hundred projects per year—organizational capacity wouldn’t allow that to happen, he said. So how do you upgrade your capacity vs. the intake is the more important question in the long run.”

 

How is Industry Finding the Next Generation of New Technologies?

Matt Zborowski, Technology Writer

27 March 2018


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