We have shared part one of this three-part series from Ed Cowsar, our CEO. We recommend reading that first, if you haven’t. Here is part two!
While the industry needs to change, it has in the past and will again. Innovation usually occurs as necessity crops its head and becomes once again the mother of invention – and patents that document innovation, along with ROI in a business case that proves the value of innovation. Oil and Gas companies and their services providers have innovated from the get-go. This industry has been flat on its back before and always springs back. The companies that lead in taking the effective shortcut to the new path are the ones to watch, and oil and gas producers learn quickly from each other.
Here’s what the innovators are doing: Paying attention to LOE by field and even BEP by well. To do this organizations need operational and analytics systems that tell them quickly, not only what happened with their wells and Artificial Lift, but what’s happening now, and even what is likely to happen. Analytics advanced, and the capabilities of Machine Learning has come of age, it’s not just a report writer or a dashboard that the innovators are leveraging. They are implementing technology with a holistic understanding for all wells and Artificial Lift Types, so operational improvements and corrections are made quickly to keep wells operating with a lean staff supported by intelligent systems.
The Operational Enterprise has come of age, and it’s not like the back office or classic enterprise Business Intelligence infrastructure; it’s in the back pocket and in the pickup of lease operators and production engineers. The Control Room does not have to be brick and mortar, it may be a collaborative platform that enables workflows from live well data to operators mobilized in a cactus patch or offshore on a floating platform, and connects 24×7 with engineers in Houston, Calgary, Stavanger and Rio de Janeiro. The Control Center is now software based and integrates the well to operators and experts in real time. The software is able to metabolize unstructured data on the fly to provide event identification, and integrated expert workflows to address the issue.
This was impossible at $100 per BBL, but now at $15-30 per BBL it is in production. Necessity, the mother of invention.
Another innovation occurred when George Mitchell pioneered horizontal frac jobs in the Barnett Shale gas fields west of Ft. Worth, and then the Eagle Ford shale broke out in a horizontal frac frenzy. However, frac jobs had been in use for decades. History teaches us that the horizontal (evolved from directional drilling which was common when I was offshore in the 80’s) drilling intersected with multiple frac zones created a scale in shale that a) required investor capital and b) was an innovation driven by the low price of oil. Some producers continued to innovate and discovered how to do horizontal fracs profitably.
Now with lower priced oil, this innovation will continue. Some are leveraging existing and evolving technology in new ways. OspreyData is implementing Production Intelligence tools that combine all production SCADA data feeds, regardless of the manufacturer of the artificial lift device, and across all SCADA networks to identify specific suboptimal well conditions to lower maintenance costs, preempt Artificial Lift maintenance events, and increase production. Innovations in this Production Intelligence platform are in all three of the functional areas including Data Ingestion and Labeling, Data Science, and Business Process Automation including workflows and machine to machine integration.
OspreyData has patented data and model simulation capabilities that help address data quality issues, and get the models working on a more realistic and larger data set of digital twins not just at the well level, but also at the field level. Bottom line, innovation lets oil and gas companies get more done with less, less time, less maintenance budget, and less operator involvement until it’s the right time on the important issues. This results in increased production, and a more agile operation that lowers Lease Operating Expense between $2.25 to $4 million annually across 100 wells. The agile cultural change that is enabled is even more valuable, positioning the producer for the road ahead.
Be sure to also look at part three! We share content like this and reminders of upcoming events, and more, in our email newsletter, so sign up if you haven’t! We welcome you to contact us today or request access to our online demo to a look at our solutions.