When world events impact the oil and gas consumers that we all are, I get a lot of interest in my position as editor of ‘the Oil Newsletter’ from friends and acquaintances. Folks seem to expect me to have the answers as to where the oil price is going next, how Katrina, and now Rita will affect us, are such catastrophes due to global warming, and so on. Of course I don’t have a clue myself, but I do hear and read a lot of industry leaders pontificate on such matters and feel obligated to try and give a kind of resume as to what folks are thinking. This is no easy matter.
Already before Katrina, opinions were divergent on the oil price. As we have noted before, even within what is now an extended IHS Energy, the IHS camp was telling us that discoveries are not replacing production and that ‘peak’ is likely just around the corner, while the CERA-side argument underlines the fact that there are a lot of mega projects—notably LPG—that are set to turn things around and rectify a tight situation over the next few years. Both views can of course coexist. In fact the situation today may be unusual in that we have some visibility of the next cycle and a half or so—with a $70 boom to be replaced in the mid term with something of a bust. Or maybe not
On the global warming issue, opinions are likewise divided along what might be called, party lines. It was interesting to see the new AAPG president, Peter Rose tending towards the warming ‘denial’ camp. Rose, writing before Katrina in the July 2005 issue of the AAPG Explorer magazine, recommended Bjorn Lomborg’s 1998 book, ‘The Skeptical Environmentalist*’ as a ‘thoroughly documented, well-informed and remarkably objective and insightful look at the environment.’ According to Rose, Lomborg’s ‘overpowering’ conclusion is that, ‘Things are not getting worse, they’re getting better.’
Like I said earlier, I’m no expert on these matters, but a quick google on Lomborg reveals that a large number of specialists in the environment field do not consider him to be ‘objective.’ Lomborg is not exactly a neutral citation. His position is not so much ‘skeptical’ as firmly in the denial camp.
At the Paris AAPG international meet, Rose didn’t get into climate change—but he was enthusiastic about the AAPG’s initiative to have a Washington-based lobbyist. It wasn’t clear what the AAPG’s Washington lobbyists will be lobbying for. But, chatting to a couple of AAPG folks, I believe that this lobbying will be along the ‘denial’ lines—and will no doubt emphasize Lomborgian arguments. As a ‘don’t know’ I am not sure I agree with this position. Firstly, it assumes that the oil industry as a whole is in the ‘denial’ camp—which is not the case for BP, Chevron and Shell (despite their enthusiasm for Formula One motor racing—see this month’s lead) and I am not sure that the rank and file AAPG membership shares Lomborg’s view. My second objection is more of a strategic nature. Many (probably most) people outside of the oil industry regard it as the latter-day equivalent of Blake’s ‘dark satanic mills.’ Lomborg’s ‘things are getting better’ is caricature of what people expect a ‘big bad oil’ exec to say. About as objective as a turkey’s opinion on the merits of Christmas.
You may think this topic is kind of wandering away from oil and gas information technology. Bear with me. Another theme of the AAPG Paris session is the dearth of personnel. The industry is seeing a hiring boom the like of which has not been seen since, well since the last one in about 1981, when oil was topping $80 per barrel in today’s dollars. The demand side of the boom is fuelled by $70 oil. But the problem is exacerbated by a couple of decades of low intake into the industry. While this is in part due to youngsters not wanting to train for a boom and bust industry in ‘bust’ mode, it is also due to the bad press the oil and gas business has got on the environment. Pretty well all the young graduates I know have great misgivings about the oil industry—for many to the extent that they would rather go into environmental geology, water resources or even wash dishes than explore for or produce oil and gas!
I know there are plenty of arguments that can be used to counter such anti-industry sentiment. I like to ask, ‘How did you get here? Oh you drove here in an automobile ’ whereupon I rest my case. Except that such an argument does nothing to change sentiment. And neither do pointers to ‘proofs’ of the denialist viewpoint from folks like Lomborg. What I am saying is that the oil industry, to counter the prevailing skepticism as to its motives, does not really have the option of denial. It is not a credible witness.
Industry has other options though, some of which were in evidence at the Calgary AAPG (see last month). The Environmental—Kyoto session was a good example of what oil company engineers can do to redress perceptions. These involve making the process of exploration and production as clean, energy efficient and un-intrusive as possible.
My own ‘environmental contribution’ this month is another book recommendation, Jared Diamond’s ‘Collapse**,’ a book, not by an environmentalist or forecaster, but by a historical geographer and anthropologist. Diamond does not really get into the warming debate, instead focuses on mankind’s past inability to cooperate when communities are faced with dwindling resources and the catastrophic results.
* ‘The Skeptical Environmentalist’, Bjorn Lomborg, 1998.
** ‘Collapse’, Jared Diamond, 2004.
To the chagrin of parts of the vendor community, Shell has eschewed the ‘buy not build’ philosophy for the last twenty years. Shell believes that developing its own interpretation technology gives it a competitive edge in both the bidding process and in geotechnical analysis. The 123DI demo was pretty impressive, showing an Asian 3D data set with a 70 km long meandering channel and spectacular mud volcanics.
Moving around the dataset revealed intriguing pock marks on the sea bed with evidence of explosive mud ejection. 123DI is a cross between GeoProbe and Google Earth, navigating massive datasets in memory. 123DI is being shown as a recruitment aid and to showcase what Shell perceives as a ‘competitive advantage.’ The in-house technology brings developers and researchers closer together—shortening development cycle times and allowing Shell’s geo-boffins to ‘try things out.’
We asked Shell’s VR Center Coordinator Marc Bevaart how the software compared with Landmark’s Geoprobe. Bevaart explained, ‘123DI is not primarily voxel-based. Its display combines different methods, x,y,z maps of events and horizons, tri-mesh displays, lines for wells paths, polygonal objects, contours and, of course, voxels. But we do not deploy the ‘probe’ technology of Magic Earth as such, although we do offer similar functionality thanks to the underlying Mercury/TGS Open Inventor library.’
The demo at the AAPG was on a Sun Blade 2500 workstation (a Linux port is underway) and a SGI-based 3D version for CAVE/curved screen environments. 123DI embeds Earth Decision Sciences’ GoCad and Open Inventor from TGS/Mercury. 123DI can read data from Landmark’s OpenWorks, Schlumberger’s Charisma and other industry tools such as Jason’s Workbench.
123DI supports plug-in applications from third parties and Shell’s own researchers. The software also interfaces with the major commercial interpretation packages. One in-house developed plug-in is the ‘FaultWorld’ semi-automatic fault extraction package—the subject of a presentation by Shell’s Jos Terken. Shell uses the technology to turn fault picks into ‘stopper voxels’ which can be broadcast to 123DI for further analysis.
Shell’s showing of 123DI at a tradeshow makes a welcome change from its usual recruiting technique—offering geoscientists a chance to change a tire on a Formula One Ferrari. Motor racing, the ultimate hedonistic/gas guzzling sport, seems strangely out of kilter with Shell’s new image, sending a bizarre message to today’s ‘environmentally sensitive’ youngsters—see our editorial..
The Abu Dhabi Company for Onshore Oil Operations (ADCO) is to deploy P2 Energy Solutions’ Enterprise Upstream (EU) suite for production and terminal management and to support planning and engineering. EU is a web-based system that integrates with existing ERP systems to add business intelligence and reporting functionality.
ADCO IT Manager Ali Bamakhrama said, ‘Enterprise Upstream allows us to plan, manage and track production and exports. We are also working with P2 Energy Solutions to deploy other products that will improve our workflows and lower operating costs.’
P2ES president Tarig Anani said, ‘This agreement gives ADCO access to our robust allocation engine offering multiple units of measure and support for the measurement and analysis needed for ADCO’s complex operations.’
EU will also support ADNOC’s production, inventory and volume measurements as well as downstream operations. The Terminal Management module manages tank inventories and party lifting positions. The software integrates ADNOC’s main production system and tracks OPEC and other goals with actual and forecast production.
OITJ—Can’t you already get online information on company reports?
Zakaib—Yes. But the situation today is that for the SEC*’s EDGAR and the Canadian CEDAR, online data is in pdf documents. This makes for rather inaccessible data with a somewhat inconsistent presentation. There are commercial services like EDGAR Online which populate their proprietary databases for sale clients. XBRL, which used to be ‘XBFRL’ began five years ago when XML first came into vogue. The idea was to tag-up business information on company balance sheets. This would enable an XBRL repository of EDGAR type information. So you could extract say, Talisman’s Q2 2005 results and compare with peers for operating costs etc.
OITJ—What about different countries’ reporting requirements?
Zakaib—The spec of course needs tuning to different accounting jurisdictions and has support from accounting bodies such as AICA (US), CICA (CA) etc. Taxonomies have been developed for the US GAAP, C&I (commercial and industrial) and the Canadian GAAP. These taxonomies need further extension to embrace oil and gas reporting specifics.
OITJ—Like reserves reporting?
Zakaib—Exactly. The extension of these taxonomies to non financial reporting is hugely topical. This is where the real ‘juice’ of XBRL lies and is the object of industry collaboration, with pressure on the SEC, and with involvement of the SPE, API, WPC and other stakeholders. Sustainability disclosure and other Sarbanes-Oxley reporting are also relevant – with the drive to ‘triple bottom line’ reporting of economics, social and environment. A new global sustainability index is to be released in XBRL with support from Shell, BP and PetroCanada. This has backing too from the international Global Reporting Institute (GRI).
OITJ—What’s actually happening today?
Zakaib—One key development that took place earlier this year was the release of a new financial reporting markup language from the US-based EBR Consortium (www.ebrconsortium.org). The EBR General Ledger (EBR-GL) 2005 spec will be underpinned by XBRL. XBRL FR for financial reporting will be next. The idea here is to build a cross industry framework with vertical extensions, rolling in GRI and COSO Risk Management and SOX legislation. We are working on extending EBR to the oil and gas vertical.
Zakaib—My company and other interested parties like PriceWaterhouseCoopers are trying to move this forward. We are talking to POSC and PPDM about data exchange and reserve reporting—we don’t want to re-invent the wheel here. Much of this information is applicable to joint venture billing, land sales, seismic transactions and performance management. To derive meaningful key performance indicators today may involve getting data from 10 different systems, reserves, accounting, etc. XBRL could fix this by simplifying interoperability.
Zakaib—The XBRL organization (www.xbrl.org) released a new version of its GL taxonomy in July. We are currently in the process of setting up a Consortium for Oil & Gas Performance and Enhanced Reporting (COGPER), a neutral, open group which is to forward this initiative. A website, www.cogper.org, is ‘under construction’ but interested parties can email email@example.com for more.
OITJ—What will drive take-up, a regulatory stick or a performance carrot?
Zakaib—Perhaps the sticks of reserves and sustainability will do most. The SEC has had a voluntary XBRL filing program as of this spring. After which there is a strong chance that this will become one of the SEC’s official filing methods.
* Securities and Exchange Commission.
PetrisWINDS Enterprise (PWE) uses some BPEL 1.1 constructs to define and manage workflows. PWE Messages (see opposite) use XML to control interaction between PWE services. These use the BPEL concept of execution processing, with nested workflows and service interactions.
A PWE Message informs a ‘Transfer service’ about which adapters are going to be invoked, and what function they are supporting. The <flow> section defines the process, and the <service> tag defines which action is requested, passing parameters to the service.
BPEL provides a language for the formal specification of business processes and business interaction protocols. By doing so, it extends the Web Services interaction model and enables it to support business transactions. BPEL defines an interoperable integration model that should facilitate the expansion of automated process integration in both the intra-corporate and the business-to-business spaces. Petris does not deploy strict BPEL tagging but plans to deploy the standard at a future date.
IBM, Microsoft, BEA (supplier of the technology that underpins PWE), Siebel and SAP submitted BPEL for Web Services version 1.1 to the OASIS standards body earlier this year.
PetrisWINDS code snippet
<name>Add QC Status</name>
UK-based Paras Consulting has just released a new multi-client study of geological modeling software. The study compares four major applications, EarthVision (Dynamic Graphics), GoCad (Earth Decision Sciences), Petrel (Schlumberger) and Irap RMS (Roxar).
Seven major E&P companies participated in the study whose objectives were to identify industry practices in geological modeling and to assess the strengths and weaknesses of the commercial packages.
The study found all four commercial packages to be ‘similarly positioned’ in the marketplace although they differ ‘in specific features and characteristics.’ In general, a ‘balancing act’ is required to ‘match effort and resources to the purpose of the project.’ The gap between seismic interpretation and geomodeling is a cause of ‘duplication of effort’ while the lack of ‘geometric rigor’ in interpretation tools typically adds two to three weeks to the structural modeling process.
Paras are not giving much away as to how the apps fared in the comparison, but MD Hamish Wilson told Oil IT Journal ‘Petrel is the one to beat!’ Commenting the report’s general findings, Paras non-executive director Dave Bamford added, ‘IT currently seems as dysfunctional as the disciplines themselves used to be. Closer integration between interpretation and modeling would shorten cycle times and enable more effective iteration between geophysicists and modelers’.
Earth Decision Sciences has just released its ‘new’ Drilling Planner Suite (DPS), an extension to its flagship GoCad modeling environment a.k.a. Earth Decision Suite. DPS helps companies plan and modify stand-alone wells, multi-slot drilling platforms and sidetracks.
DPS lets users create well templates with default parameters that can be changed to match drilling and platform specifications, collision risk cutoffs and survey data. An ‘extended module’ offers side track planning, path uncertainty, collision risk analysis and better well trajectory planning. DPS workflows include information gathering and engineering design, target selection and uncertainty and collision risk analysis. DPS also supports cost evaluations over a variety of scenarios of targets, paths and locations – allowing for fine grained control over costs at all stages of a drilling campaign.
DPS is not really ‘new’. EDS announced a ‘Well and Platform Design’ (WPD) module for GoCad back in January 2003 (OITJ Vol 8 N°1), a joint development with University of Colorado’s BP Center for Visualization.
Knowledge Systems (KS) has kicked-off a Joint Industry Project to develop an improved methodology for predicting subsalt geopressure. KS will study data from 50 wells in the Gulf of Mexico to develop ‘best practices’ for pressure analysis and improved seismic imaging below salt.
KS CEO Jim Bridges said, ‘Pore pressure and lithology can make drilling below salt extremely challenging. Better pressure prediction upon exiting salt can reduce downtime, lower casing costs and optimize the wellbore for production while also impacting safety and the environment.’
Fugro is providing seismic data to the project from its ‘Deep Focus’ 2D and 3D deepwater GoM spec surveys. The project originated with the US Department of Energy ‘DEA 119’ project which targeted pre-drill pore pressure and fracture gradient prediction in deep water wells. Following project kick-off last month, Brasilian Petrobras has already joined the JIP.
The 2005 US Energy Policy Act is calling on the Mineral Management Service for a ‘comprehensive inventory’ of oil and gas resources on the outer continental shelf (OCS). The legislation calls for resource estimates on the OCS, including moratoria areas, using ‘any available technology, except drilling, but including 3-D seismic surveys’ although the six month time frame imposed by the legislator means that no 3D surveys will actually be commissioned. MMS plans to use existing data and is ‘encouraging industry’ to provide data that ‘may not have been previously shared’. The report will be publicly available and updated at least every 5 years.
Following the impact of hurricane Katrina, the MMS implemented its Continuity of Operations Plan (COOP), moving its operations to Houston. The MMS’ Gary Strasburg told Oil IT Journal, ‘Every May the COOP team and all of their backups participate in a COOP test in which they simulate a total shut down of the New Orleans ‘NOLA’ domain. During this time we also set up communication with the US Coast Guard.’
London-based Tullow Oil has selected Schlumberger Information Solutions’ Petrel as its primary seismic interpretation, petrophysical and reservoir modeling tool.
Tullow Exploration Manager Chris Flavell said, ‘We can make faster and more accurate decisions by taking advantage of the streamlined workflows available in Petrel. Cross-domain integration improves knowledge sharing across our workflow.
Tullow geophysicist John Boucher added ‘Petrel has been deployed globally and provides a cost-effective solution for our seismic interpretation and modeling needs. Our experts now collaborate on a shared model, using a shared set of tools—resulting in a more complete understanding of our reservoirs and their drainage characteristics.”
Petrel will interface with Tullow’s existing OpenWorks corporate data stores via OpenSpirit, avoiding the need for any migration of data. Tullow is to replace its legacy interpretation packages with Petrel tools.
Roxar’s FieldWatch project is the beneficiary of ‘multi-million’ dollar funding from the Norwegian Research Council’s ‘Petromaks’ R&D program. FieldWatch promises real-time integration of production data with reservoir characterization and fluid flow simulators, notably Roxar’s Irap RMS.
Petromaks is assisting the Norwegian government in the implementation of its strategy ‘Oil and Gas in the 21st century’ initiative (OG21). OG21 is said to address the needs of oil companies, the supply and service industries and the petroleum-related R&D sector.
Funding for the FieldWatch project comes equally from Roxar, Petromaks and Statoil. Statoil senior advisor Eilsø Nilsen said, ‘This project is aligned with our vision of becoming a leader in the use of integrated operation concepts through R&D that targets improved methods and tools.’
Petter Abrahamsen, Director of the Norwegian Computing Center (NCC), a partner in the FieldWatch initiative, said, ‘This cooperation with Roxar and Statoil will allow us to maintain and further develop our geostatistical reservoir characterization and integrated risk analysis capabilities.’
The latest issue of Schlumberger’s ‘The Click’ newsletter includes a description of Design of Experiment techniques with Cougar by Wilson Rodriguez.
Molli Computer Services now offers MICA Statewide databases of oil and gas production history for California, Michigan, New Mexico, Utah and West Virginia.
BP has contracted Midland Valley to enhance its ‘Realtime’ 3DMove Well Placement geosteering application by integrating dynamic structural modeling with azimuthal LWD.
Digital Formation has just released LESA (Log Evaluation System Analysis) for open and cased hole log analysis. LESA supports LAS, LBS, LIS and ASCII log data.
A team of IFP researchers received the Schlumberger prize from the French Academy of Sciences for their work on history matching with a ‘gradual modification of images of geological facies distribution or petrophysical properties’.
Rose & Associates has released a new version of it ‘workhorse’ prospect risk analysis product, MMRA (Multi-Method Risk Analysis). MMRA V4.0 adds complex trap modeling and more flexibility in modeling reservoir parameters.
GeoPlus’ Petra now includes a 3D Visualization module tied to the Petra database for visualization of well data, subsea grids, isopachs, map overlays, and cross sections.
Neuralog’s NDBX a ‘neural database’ plug-in extends ArcGIS functionality to combine GIS and structured queries. Neuralog uses OpenSpirit’s ESRI to Open Works link.
EarthMoves has created a detailed movie of the opening of the South Atlantic from its shape file-based digital geology. The Cambridge University ATLAS package, developed by Alan Smith, was used to create the movie.
‘Free or Fee,’ a White Paper on the GITA.org website investigates government data ownership—asking, ‘Should federal and local governments sell their geospatial data sets or distribute them for free?’ GITA has also published its 2005 Geospatial Technology Report, a survey of geospatial IT.
M2M Corp has upgraded its remote monitoring ‘AlertServices’ product line to offer demand poll and GPS location functionality.
PGS is converting its high tech 4 component ocean bottom vessels Ocean Explorer and Falcon to conventional towed streamer operation – capitalizing on a ‘substantial improvement’ in the towed streamer seismic market.
Roxar has won a Norwegian court ruling protect its multiphase flow meter technology from ‘unlawful use’ by another Norwegian company, FlowSys, founded by former employees of Roxar.
MRO Software hosted its first Oil & Gas User Group meeting during the recent MRO World event in Dallas. MRO Software’s flagship Maximo product is used to manage and maintain assets across a broad spectrum of industry verticals. The MRO User Group (MRO-UG) is headed-up by a steering committee with representatives from MRO, Occidental and BP.
Russell Bee (MRO Software) presented MRO’s ‘vision’ for the oil and gas sector. Future releases of MRO Software’s Oil and Gas Industry Solution will offer greater functionality for the refining and exploration and production markets and increased integration capabilities with other technologies such as Primavera and Intergraph to provide further ‘depth’ to the solution. MRO is also migrating specific oil and gas functionality to the new Maximo Enterprise Suite (MXES) platform. Users will see ‘more flexibility’ and extended asset types along with the ability to set, manage and track service level agreements.
Dean Edmundson (Primavera) presented a paper on asset and resource use optimization. Primavera’s clients integrate core operation and maintenance software systems. Some of the world’s largest refiners report ‘increased plant up time through better asset management and resource forecasting’. Others have increased productivity by integrating asset and resource management systems.
Ahmad Al-Anezi from Kuwait’s Petrochemical Industries Company and IBM’s James Neophytou discussed Maximo’s 5.2 release in the context of the petrochemicals business. PIC and IBM collaborated on a major Maximo deployment at a Kuwait Petroleum Company chemical plant.
Shortly after the MRO-UG, MRO Software announced that it was to team with ESRI to embed ArcGIS components into Maximo Enterprise Suite (MXES) to spatially-enable MXES. The solution is to leverage open standards-based Java development environments from both companies. MRO Software will incorporate ArcGIS components into Maximo’s J2EE technology framework, creating a user interface that supports robust interactions between the work and asset management and the GIS from a single application environment.
ESRI Director David Wieseler said, ‘This collaboration is an important step in the geospatial enablement of the enterprise. MRO Software and ESRI now share a development architecture that enables the seamless integration of our respective technologies.’
MRO executive VP Pat Foye added, ‘Many clients have asked us to integrate Maximo with GIS using native ESRI components. The fact that MRO Software and ESRI are working together has sparked a great deal of interest internally within our respective companies as well as within our respective client bases.’
Schlumberger and Norway-based Sense Intellifield are to collaborate on the design and deployment of real time drilling operation centers. The ‘Operation Support Centers’ (OSCs) are tailored to client requirements using ‘proven and scalable’ components. The announcement was made at the Offshore Europe 2005 tradeshow in Aberdeen this month. Schlumberger is to provide operations management and technical services including interpretation software, connectivity, data management and security. Sense will provide design, construction, commissioning, hardware and system support services.
Schlumberger claims a decade of experience in drilling optimization from its in-house OSCs which leverage its realtime drilling software. The announcement follows a long-term collaboration between Sense and Schlumberger with some 120 real-time centers already built.
Sense worked with Statoil in 2002 on its first drilling operation support center in Stjørdal for the Halten Nordland area. Since then Statoil has established other centers for Norwegian and international operations.
Statoil senior advisor Peter Nielsen said, “Statoil uses collaborative real-time environments to remotely monitor, model, and control processes to optimize drilling. In the Åsgaard field, Schlumberger is providing seamless 24/7 support between the field and Statoil’s Stjørdal center and Schlumberger’s centers in Aberdeen and Stavanger.’
Schlumberger now has 27 drilling operation centers worldwide. These provide secure access to Schlumberger’s InterAct real-time monitoring and data delivery technology.
Paal Kibsgaard, president, Drilling & Measurements, Schlumberger, said, ‘We provide the flexibility to run real-time operations from the customer’s center, our center or a combination of both, to optimize the drilling process by reducing cost and risk. Moving forward, we want to leverage this collaboration to offer industry-leading real-time drilling operation centers. With this agreement we are offering customers the strongest interactive drilling operation solution in the market.’
Sense Intellifield has built over 80 remote drilling operation centers in the North Sea and elsewhere. Sense Intellifield offers equipment and services for the automation and remote operation of offshore installations. This allows customers to transfer working processes to land-based sites, enabling efficiency gains.
Despite a whole conference, the PUG* (OITJ Vol. 10 N° 3), dedicated to the applications of ESRI’s Geographical Information Systems (GIS) to oil and gas, many authors keep their papers for the annual ESRI User plenary—held in ESRI’s San Diego fiefdom. Most papers in the oil and gas track related to pipeline GIS, with several presentations from Government agencies.
Petrobras was an early implementer of the ArcGIS Pipeline Data Model (APDM) at Petrobras. Sidney Santos described how the company leveraged its APDM system, in particular with a ‘Scenario Builder,’ and in-house development that exposes gas pipeline simulation results to different stakeholders throughout the company. The new tool allows non-specialists to access GIS and pipeline simulation data without detailed knowledge of the underlying applications.
Imtiaz Ahmed’s presentation showed how GIS now plays a central role in Saudi Aramco’s well placement workflow. Aramco’s well planning process (WLP), a GIS-based application developed in-house, is used to optimize well placement according to criteria including geology, reservoir information and surface features. Locations are analyzed by drilling engineers, facility planners, production engineers and geoscientists for final approval. A toolbar in the E&P GIS application provides an entry point to advanced WLP functions including an ArcMap table window for viewing and analysis in Crystal Reports.
Chris Galagan (Applied Science Associates) described how digital terrain models such as the US National Elevation Dataset (NED) are used to model oil spills and their consequences. NED provides 30m (in some places, 10m) resolution over the US. Other inputs to the modeling process are land cover, surface water, oil composition and environmental parameters like wind speed and air temperature. The ASA spill model outputs its results to ArcGIS for high consequence area (HCA) analysis and reporting.
Pacific Gas and Electric
Gordon Ye’s presentation also related to HCA evaluations. Pacific Gas and Electric (PG&E) uses aerial ortho-photography and cadastral GIS data to make accurate determination of land use in the vicinity of PG&E gas transmission pipelines in California. Spatial analysis is performed in ArcGIS’ native Visual Basic to derive HCA data and Class Locations in compliance with federal regulations.
Nicholas Spiteri (StarTrack) showed how GIS use is augmented with real time data from the field. StarTack uses low cost messaging services provided by low-earth orbit (LEO) satellite networks. These are being used to track mobile assets; to monitor meters, storage tanks, wells and pipelines; and to stay in touch with remote workers. Potential applications are in automated pig tracking with real-time reporting on pig movement and pipeline security for leak detection, monitoring of pipe/soil detentions and illegal tapping detection.
Robert van Wyngaarden (Golder Associates) described BP Canada’s GIS-enabled Emergency Response/Stakeholder Relations (SRD) database. Drivers include regulatory requirements and legislation, business operational efficiencies, as well as general Best-of-Practice principles. The SRD is a custom development integrating database and GIS technologies served in a Application Service Provider (ASP) mode.
US DOT PDF
Samuel Hall (US Dept. of Transportation) described how the National Pipeline Mapping System (NPMS) uses GID to disseminate critical pipeline infrastructure data. The database is owned and maintained by the Office of Pipeline Safety and holds information on hazardous liquid and gas pipelines in the US. One challenge has been to protect sensitive data while making it available to qualified parties for activities such as analysis and emergency response. The solution, an ArcIMS Web site, displays pipeline data, sensitive and high population areas and Federally-owned property. Innovations include the use of OpenGIS to display other agencies’ data, granting users partial data access by password, advanced buffering and query and enhanced security.
* Petroleum User Group.
Last year, David Gawith, MD of UK-based software minnow EarthModels told Oil IT Journal, ‘We are currently seeking a commercial partner to help realize the potential of ChronoSeis.’ His search is now over. Ikon Science has acquired Gawith’s company for a mind boggling $2.6 million cash and paper consideration. EarthModels’ ChronoSeis seismic interpretation package was used by Ikons’ consultants on projects such as OilExco’s Brenda development and on 23rd licensing round bids. Gawith is to continue developing ChronoSeis, as well as Ikon’s RocDoc and FaultX applications.
Ikon MD Martyn Millwood Hargrave said, ‘ChronoSeis fits well with our business of developing easy-to-use software that helps clients evaluate opportunities with both well and seismic data. ChronoSeis combines speed and rigor. In our Brenda studies, we generated multiple well locations every week. ChronoSeis made it possible for us to combine ongoing well results with rock physics and geological modeling to pick new well locations. Nothing else could do this.’
OilExco CEO Art Millholland added, ‘We used ChronoSeis on our central North Sea Brenda and Nicol developments where it played a significant part in Brenda’s development.’ ChronoSeis provides ‘what-if?’ modeling and model synchronization over the Internet, for remote team working. An ‘entry-level’ geostatistical modeling is available as a hosted solution through Petris WINDS.
Divestco has sold a total of $9.3 million new shares to First Associates Investments, Northern Securities and investors. Proceeds will fund capital expenditures and ‘general corporate purposes’.
Austin Geomodeling Inc. has signed with Reservoil to represent the company in India.
Mohammed S. Al-Jawad, assistant professor in the Petroleum Engineering department of the University of Baghdad, has contributed a paper to the OilIT.com online archive on the use of SimBestII to study fractured reservoirs. SimBest was marketed by Scientific Software-Intercomp some years ago. Any companies willing to supply the University with more up to date software should contact firstname.lastname@example.org.
Common Data Access has appointed Colleen Bonthron commercial manager. CDA is currently in the process if re-tendering for the running of its UK data store’s operation.
CGG has acquired Norway-based seismic contractor Exploration Resources (ER). CGG was especially attracted by ER’s seabed acquisition unit, Multiwave. ER also recently acquired a System One acquisition system from CGG competitor, Input-Output. Fugro, another ER suitor, threw in the towel following the CGG offer. CGG has also named Christophe Pettenati-Auzière VP Geophysical Services.
EDS has named Ray Cline VP of innovation and integration. Cline was previously with SAIC.
Co-founders Bob Ashauer (president) and Cal Fairbanks (CEO) have resigned from ElectroBusiness. Bryan Kelly is the new CEO.
Geoservices has sold its Well Testing unit to PowerWell Services of Houston.
Greg Hess has resigned as VP Business Development & Technology from Kelman Technologies.
Guy Gueritz has moved from LinuxNetworx to HP’s workstation division.
Former Schlumberger sales executive Jim Railey has joined The Harbour Group as Business Development Executive in the Oil and Gas practice.
Invensys has appointed Nabil Kassem VP and General Manager for its Middle East unit. Kassem was previously with Schlumberger.
New Century Software has hired Robert Brook as Business Development Manager. Brook was previously with ESRI Canada.
Mike Jackson is to head up the new Centre for Geospatial Science at the University of Nottingham (UK). The center has support from the Open Geospatial Consortium.
David Douglas is to head up Ogre System’s new Houston office. Earlier this year, a Houston based investment group purchased the assets of Ogre Partners to form Ogre Systems.
BJ Services has appointed James Curtis to technical manager of its Aberdeen-based Well Services Division.
OpenSpirit now offers developers an online forum for 24x7 real-time assistance via threaded correspondence, archived support information and support downloads.
Paradigm has appointed Jorge Machnizh as COO and David Verdun to VP R&D. Both hail from Input-Output.
The Peak Group has appointed Clarke Denney to operations manager of its Houston office and Nick Muecke to its Asia Pacific operations in Perth, Australia.
The Pipeline Open Data Standard Association (PODS) now includes Michael Baker Corp., CITGO and Texas Gas.
Recent new members of the Public Petroleum Data Model Association include Amerada Hess, Capstone Energy, Chesapeake, Chevron and Pemex.
Ryder Scott has hired petroleum engineers Mark McCloskey and Larry McHalffey.
SAIC is going public with an IPO scheduled for early next year.
Stanford University is to kick-off an R&D consortium on ‘Smart Fields’ real time production modeling and optimization.
WellPoint Systems has appointed Wanda Dorosz to its Board of Directors.
Ryall Fox from Bentley Systems points out an error in our interview with Anne-Marie Walters (OITJ Vol. 10 N° XXX). Contrary to what we reported, Bentley has not acquired Intergraph’s PDS division. We apologize for the error.
Competition is hotting-up in the GIS/geospatial imagery market. In the red corner, ER Mapper has expanded its geospatial imaging solution to embrace GIS and internet map deployment. In the blue corner, GIS behemoth ESRI now offers a geospatial image server.
Australian ER Mapper’s Internet Map offers rapid access to Terabyte image datasets of maps and imagery, integrated with search engines and georeferenced databases.
ER Mapper CEO Stuart Nixon said, ‘ER Mapper now offers full-blown GIS features such as transparent layers and overlay of location-based information from different search and geolocation services.’
ESRI’s Image Server moves in on ER Mapper’s bailiwick by offering visualization of large file-based imagery, with real time image enhancement, orthorectification and complex image mosaicing. The server enables the creation of web-based solutions that integrate geospatial imagery with the GIS. ESRI’s Image Server supports foreign GIS formats including ERDAS, Intergraph, MapInfo and CAD software including AutoCAD and MicroStation.
Divestco generated record revenue of $9.2 million for the second quarter of 2005, up 52% on the same period in 2004 (all subsequent comparisons are Q2 on Q2).
Fugro’s turnover for the first six months of 2005 was €518 million, a 7.9% hike. High oil prices are increasing oil company investments as witnessed by two reports forecasting a 13% hike for 2005.
Baker Hughes reports revenues for Q2 2005 at $1,7 billion, up 18%. Chairman and CEO Chad Deaton said, ‘We have increased our capital spending budget for 2005 and continue to invest in people and new technology and to strive for fair pricing.’
CGG’s second quarter 2005, processing and reservoir revenues were €27 million, up 7% in a market ‘stimulated by the demand for high-end imaging services’. CGG Chairman and CEO, Robert Brunck said, ‘This confirms the positive trend in the seismic market.’
Computer Modelling Group’s revenues for Q2 2005 were $3.4 million, up from $3.3 million. CMG sees increased demand for reservoir simulation and is to expand operations with the addition of eight new staff in 2006.
Core Laboratories reported its highest quarterly totals ever for Q2 2005 with quarterly revenue up 16% at $118 million.
Halliburton reports record operating income of $607 million for Q2 2005. Digital and Consulting Solutions (DCS) operating income for the quarter was $16 million, 14% up from Q2 2004. Landmark’s operating income increased by $14 million. Halliburton reports ‘strong growth’ from its production optimization segment.
Input/Output, Inc. announced Q2 2005 revenues of $84.0 million, up from $62.3 million. GXT, acquired in June 2004, generated revenues of $24.2 million although the company notes ‘low processing margins due to excess capacity.’
Despite a net loss of $2.1 million for Q2 2005, Kelman has launched a recruitment campaign—anticipating expanded operations in the US and internationally. Data management activity performs ‘reasonably well’ in Canada; less so in Houston. Kelman sees activity strengthening, hoping this will attenuate the ‘fierce price competition that has plagued the seismic processing industry.’
PGS reports ‘continued strong seismic momentum’ and revenues of $292.8 million, up 21% from Q2 2004.
Houston-based Seitel, Inc. reported revenue of $36.0 million for the second quarter 2005. CEO Rob Monson said, ‘We are seeing more interest in older US 2D data and healthy activity in our core 3D data base.’
TGS Nopec’s net revenues for Q2 2005 were $55.0 million, up 34%. CEO Hank Hamilton said, ‘We see more urgency from our customers in data purchasing as exploration programs become a higher priority.’ The TGS Imaging and A2D well log segments totaled $1.1 million, up from $0.6 million in Q2 2004. The market for seismic services and products continues to strengthen as witnessed by a ‘clear and definite’ increase in exploration focus from oil companies.
Weatherford International’s revenues for the second quarter were $937.3 million – the highest in the company’s history – and up 26% on the same period last year. R&D spend was $23.9 million in the quarter.
WellPoint Systems’ second quarter revenues (ending June 30, 2005) showed an increase of 22% to $1.9 million over 2004 with ‘strong’ US and software revenue growth.
The American Records Management Association’s (ARMA) 2005 convention, held in Chicago this month, reflected a shift in records and information management (RIM) from paper based systems to digital. In the IT and management session, Shell’s Debra Anne Duncan described the move from RIM systems to ‘back-office processes.’ The move has streamlined accounts-payable, sales and tax compliance at the expense of complex IT processes involving components from FileNet, Tibco, EMC—connected with a mixture of Visual Basic, Java and BEA WebLogic.
Susan Sullivan of the US National Archives and Records Administration (NARA) introduced the PDF/A ISO standard for long term preservation of PDF documents. Current PDF formats are ‘unsuitable’ for archive purposes, but pdf documents are ‘ubiquitous’ in corporate and government archives. NARA is working on a toolkit to migrate legacy PDF to the open standard which embeds metadata in Adobe’s eXtensible Metadata Platform (XMP).
Joanna Fagan (Georgetown University) described how the US National CAD standard helps manage construction documentation and oversize drawings and project files. This protocol supports project management over the facility lifecycle. Other ARMA presentations address issues such as the use of RFID in physical records management, creating ‘order out of chaos’ with taxonomies and disaster planning and prevention in the digital age.
BP has awarded the Shell/Halliburton joint venture WellDynamics a contract for the provision of multiple ‘intelligent’ completions on its Angolan deepwater Greater Plutonia development. WellDynamics will supply its ‘SmartWell’ downhole flow control and completion equipment for water management on Plutonia’s five constituent fields.
Half of Plutonia’s 40 wells will be used for water injection to maintain reservoir pressure and to assure sweep efficiency. SmartWell completions are a key enabler in this context since most injectors will be completed in separate channel sands. SmartWell technology offers well lifetime monitoring and control of injected volumes by completion interval. Other applications of the technology may include gas injection and production allocation control.
WellDynamics was formed in 2000 by the fusion of Halliburton’s SmartWell techniques with Shell’s iWell program.
The European Pollutant Emissions Register (EPER) compiles emissions data on a public website (eper.cec.eu.int). The site provides xml-based emissions reports from EU countries. Currently data is somewhat stale, only 2001 data is available, but we understand that the information for 2002-2004 will be added ‘real soon now’.
CONCAWE, an oil company grouping promoting downstream HSE, has developed a Toolkit to generate EPER-formatted emission data from refinery site data. The toolkit was developed to mitigate the risk of continuous monitoring being ‘forced’ upon a site.
The Toolkit will supply data to the Pollutant Release and Transfer Register (PRTR) due for implementation in 2007. EPER data is namespace-less, XML with tags for company, facility and emission levels by pollutant. GIS systems allow for EU-wide emissions mapping.
Two Denver-located companies, Divestco unit Petro Data Source and MapMart are to offer a ‘one-stop shop’ for map-related data for the oil industry. The companies will leverage MapMart’s map-centric interface to serve US well data, aerial photography, satellite imagery, digital elevation models and USGS topographic maps.
Data is priced on a transactional basis, so users can acquire data for any specific area of interest. County and state level pricing is also available. Data is available for immediate download and can be imported into various software applications and shared with colleagues.
MapMart is a division of IntraSearch which also provides custom aerial photography, geologic and topographic mapping, orthorectification, digital conversions, scanning, plotting, computer assisted design (CAD) and geographic information systems (GIS) solutions for both public and private sector clients and online mapping products and services via the MapMart website.
Halliburton CEO Dave Lesar, in a presentation to the Lehman Brothers Energy and Power Conference this month announced imminent ‘across the board’ price rises for Halliburton’s services. Increasing demand has allowed the rises and ‘allayed concerns over capacity.’ Lesar attributes Halliburton’s success to its ‘vigorous’ R&D which ‘churns-out’ new products and some 34% of Energy Services’ revenue.
Lesar claimed that Halliburton has an 8-10 year demographic advantage over the industry and that an ‘aging industry will outsource more and more to a younger Halliburton’.
Halliburton is to take a ‘tough stand’ on individual product lines and unprofitable geomarkets and anticipates some ‘tough conversations with customers’ on pricing. While North America is where the action is today, the future lies in the Eastern Hemisphere—68% of new ‘big dollar’ projects are outside North America.
Halliburton CFO Chris Gaut described the company’s turn around in profitability. The Energy Services Group used to trail its peers, but is now ahead with operating margins of around 20%. Halliburton’s analysis shows a service industry average annualized return on capital employed (ROCE) for Q2 2005 of 18%. Halliburton leads with 23%, Schlumberger 19%. Laggard WFT 8%. According to Gault, without KBR, Halliburton’s ROCE would be ‘100 basis points higher’. Halliburton is ‘looking to infill acquisitions’ and is moving forward with plans to separate its KBR businesses.
EnCana has expanded its implementation of Digital Oilfield’s (DO) automated invoice processing and reconciliation software tools, OpenInvoice and OpenContract, with a ‘multi-year’ corporate license. EnCana first deployed DO’s solution in 2002 (OITJ Vol. 7 N°11). The latest announcement covers an extension of the service to include DO’s OpenContract and OpenInvoice Image. OpenContract reconciles invoice pricing automatically and offers suppliers ‘early pay’ discounts. OpenInvoice Image creates digital invoices from scanned images.
EnCana CIO Hayward Walls said, ‘We have realized tremendous value from Digital Oilfield’s technology. We are now extending the term of our agreement and adding more modules. We are also bringing in more suppliers and transacting higher percentages of expenditures and invoice volume through the system.’
The Image add-on module extends the digital workflow to manually-submitted invoices. Paper images are scanned and can then integrate the same processing, routing and approval as electronic invoices. OpenContract adds pricing reconciliation, early pay discount management, and contract lifecycle management capability.
Other DigitalOilfield users include ARC Energy Trust, Unocal, Schlumberger Oilfield Systems and OFS Portal members. DigitalOilfield uses API/PIDX invoicing standards for direct ERP to ERP invoicing.
New Mexico-based Dugan Production Company (DPC) is to deploy Wellogix CSM solution to optimize its supply chain processes. DPC will use Wellogix’ Complex Services Management (CSM) suite to streamline its invoicing and to speed payment.
Dugan CEO Tom Dugan said, ‘We have run a tight ship for many years and are always looking for ways to optimize operations. Managing the commercial aspects of complex services can be a challenge, but we understood that process optimization would be cost-effective.’
‘We operate a large number of wells, and purchase products and services from hundreds of vendors. We saw the value that BP and Marathon Oil got from Wellogix and expect that supply chain optimization will drive value directly back to operations within our company,’ concluded Dugan.
40 wells per year
Founded in 1958, DPC operates some 800 wells and is currently drilling 40 wells per year. DPC maintains its own lease operations, well servicing rigs, roustabouts, water trucks, machine shop, and measurement and compressor maintenance operations and attributes its growth to its ability to restore marginal wells to profitable production.
Calgary-based Decision Dynamics Technology (DDT - formerly Malibu Engineering) is rolling out a new version of its Wellcore suite for well lifecycle management. Wellcore 4.0 targets large independent E&P companies with solutions for new ventures inventory management, geoscience, land, well planning and cross-business finance and planning.
Wellcore now also manages pipeline gathering networks and ‘post production’ activities such as abandonment and reclamation of surface facilities. Wellcore modules provide ‘out-of-the-box’ best practices which can be customized to incorporate a client’s own work processes.
Devon Canada has been beta testing Wellcore 4.0 in its Canadian E&P operations. Devon has trained over one hundred field and five hundred office users on the system. The new release leverages a company’s existing IT infrastructure, reducing configuration costs. Wellcore includes client, server and web-based components for collaborative project planning, rig scheduling and reporting.
DDT president Cecil Shewchuk said, ‘This release of Wellcore provides a truly comprehensive well lifecycle management solution. The ability to configure our product to maintain a customer’s competitive advantage and the low total cost of ownership make it a compelling solution for the industry.’
The new release also offers firewall-friendly deployment leveraging Microsoft Active Directory permissions and SLL data encryption. These and other improvements provide SOX compliance and streamline software administration.
The new E&P software house, Transform Software, founded last year by former Landmark Graphics employees Dean Witte and Murray Roth, has succeeded in raising some $2.25 million venture capital from sources including Quest Capital Partnership, co-founded in 1997 by former SEG President Rutt Bridges (also ex-Landmark). The money will be used to expand operations and deliver upstream interpretation software later this year. Transform’s first offering combines 3D visualization and integration techniques to ‘streamline the fusion of E&P data, including full-wave seismics, and to ‘simplify the creation of geologic models.’
Transform CEO Dean Witte said, ‘Most E&P software originated 10 or even 20 years ago so there is an urgent need for innovation to meet modern E&P challenges. Transform’s software will connect with existing data and IT environments, adding powerful extensions to streamline the transition from geoscience data to drilling and reservoir engineering decisions.’
Quest president Steve Leatherman added, ‘It is rare to see experienced management and top-flight technology people join together in a start-up venture like Transform. What excited us about this investment is the combination of personnel experience spanning technology innovation, business development and fiscal management. Coupled with the current oil and gas market financials, we feel that Transform is a unique opportunity.’
Transform leverages an ‘open technology infrastructure’ in its new interpretation system which will support geoscience interpretation, depth conversion, seismic inversion, geologic and reservoir property modeling. System output can be transferred to Eclipse, VIP, CMG, etc. for simulation. A well planning function will also be included. Transform connects to multiple data stores with OpenSpirit and offers multiple views of the same data scene or multiple, synchronized scenes containing data from different domains. Transform is to launch at the Society of Exploration Geophysicists (SEG) Houston meet in November.
Schlumberger is to deploy a high-performance Linux cluster from Sun Microsystems to develop its ‘Intersect’ next-generation reservoir simulator. Intersect, developed in collaboration with Chevron and Total targets thermal simulation to improve recovery from heavy oil reservoirs. The project will migrate Schlumberger’s ECLIPSE simulator to a scalable, ‘non-proprietary’ cluster system.
The cluster is comprised of 64 dual cpu Opteron-based Sun Fire V20z servers running 64 bit RedHat Linux, along with cluster management and performance tools from Streamline Computing. The package embeds ‘essential open system components’ into high-performance, scalable systems. Sun and AMD will provide a range of hardware and technical expertise over the next 12 months.
The system was preconfigured in Sun’s Customer Ready Systems (CRS) integration centre in Linlithgow, Scotland, where the configured cluster was tested prior to delivery in three assembled racks. Streamline was spun-off from Warwick and Oxford Universities in 2000. To date the company has delivered over 150 MyriNet and Gigabit clusters to many blue-chip organizations in the UK.
Invensys’ Centre for Hydrocarbons Innovation has designed an innovative real time production control system for the Karachaganak oilfield located in Kazakhstan, one of the largest oil and gas condensate fields in the world with over 1,200 million tonnes of oil and condensate and 1.35 trillion cubic meters of gas. A $ 4.3 billion field re-vamp is being carried out by the operator, Karachaganak Petroleum Operating (KPO), a joint venture of BG Group, ENI, Chevron and Lukoil.
To optimize production, KPO wanted to pro-actively monitor individual wells, networks and facilities but was confronted with limited wellhead instrumentation and extreme environmental conditions which made data aggregation and allocations hard to achieve. Additionally, KPO required a scaleable solution that would accommodate changes in business requirements.
The only data available was well-head pressures based on historical test data, with a very low level of instrumentation. Multi-phase flowmeters in the pipeline leading to the processing plant gave plus or minus 20% accuracy.
The solution involved an unusual use of Invensys’ PipePhase pipeline modeling package, traditionally used in front end engineering design. PipePhase was deployed in a real-time environment to compute flow, temperature, pressure and compositional information. The ’virtual gauge’ technique reconstituted data points at each pipeline, well head and manifold from the limited data available.
The next step was to apply Automatic Rigorous Performance Modeling (ARPM) to reconcile the flow feeds entering and exiting the processing plant through the export pipeline (where metering is much more accurate). KPO engineers can now optimize the processes for maximum efficiency—and save energy along the way. The risk of over-production from individual wells is reduced, prolonging field life.include ("copyright.inc"); ?>