As we boldly announced last month, PDM was on a mission to the SPE. We planned to track down and report on new applications of 4D, time-lapse seismics to reservoir management. We were disappointed to find that at the SPE, the home of reservoir management, virtually nobody was even talking about the new technology. Well, there were some signs of activity, Schlumberger’s SimOpt, although still largely under wraps, will soon integrate 4D seismic information and Scandpower is currently developing such capability. But why is this great new technology being adopted so timidly? I reckon it’s because the geoscience to petroleum engineering boundary delimits the biggest silo wall in our industry.
Actually, the SPE program contains all sorts of enticing topics, ‘integration’ and ‘multi-disciplinary’ teams are the order of the day. But there is more talk than substance here, offering little more that camouflage for the old silo boundary. I attended the session on ‘seismic applications’ and listened to two papers with ‘seismic’ in the title - but nowhere else, one paper on ‘4D seismics’ which wasn’t, and another pure ‘seismic’ paper, with no engineering. We seem to be light years away from melding the disciplines.
In the past there has been a kind of natural demarcation line between the silos, between the static world of the geoscientist and the dynamics of the reservoir engineer. But with time-lapse, seismic suddenly appears on the wrong side of the fence, offering the reservoir engineer ‘in-your-face’ observations of what is really going on. Not modeling, reality! A paradigm shift of this magnitude is revolutionary stuff to the silo worker - and to the software developer.
The magnitude of the developer’s problem is evident from the embryonic 4D offerings that currently involve taking some minimal subset of information (such as a cube of water saturation values) and passing it over the silo wall in the manner of a ‘hot potato.’ The potato can then be peeled, mashed or whatever, and another subset of information (such as a map of flow boundaries) passed forward. This preserves the silos, and ensures that cooperation between engineers and geoscientists will be minimal, maintaining the natural order.
Irony apart, I know there is cross-discipline cooperation today, but the trouble is that it mostly works through visualization. If you can see two ‘hot potato’-type data sets, from different parts of the data chain, at the same time, then you are ‘integrated.’ But there’s more to data integration than just seeing.
To exploit 4D to the full, we need to compute across the silo boundary. Ultimately, to fully exploit any seismic dataset, you need access to pre-stack data for attribute analysis. Downstream you need to be able to go around the simulation and history matching loop, conditioning the results with input from multiple 4D datasets. Ideally you need visibility and computability of data irrespective of its place in the chain. Managing the reservoir becomes managing, seeing and computing data, from pre-stack seismics to well tests, simulations and real time.
Beyond the pale
Using all the data in a non-trivial manner is beyond today’s silo-focused applications. This partly explains the popularity of non-silo oriented environments like Technoguide’s Petrel and T-Surf’s GoCad. Both cut across the silo boundaries, although neither address 4D seismics right now, and both are rather ‘visualization’ focused.
In this context, the rising profile that Schlumberger is giving to Open Spirit may be significant. Now Schlumberger products ‘integrate’ Open Spirit rather than GeoFrame. Reading the tea leaves left by the marketing department, it is clear that Open Spirit is no longer just the approved way of integrating non-GeoQuest applications. It is has become, in the space of six months, the preferred route to application integration.
But what kind of integration? If we are aiming for visualization-focused integration, then exposing application data through Open Spirit is OK. But one aspect of Open Spirit that has been somewhat overlooked is the way software can be componentized, and used to build ‘ad-hoc’ applications. Looking maybe a few years into the future, one can see how such technology could be used to build a bespoke ‘seismic processing through reservoir modeling’ application tailored to our 4D problem. Whether this will work depends on what is meant by Open Spirit ‘enabling’ an application. If it means exposing data to other applications, or being able to ‘see’ foreign data stores, then we won’t have moved very far down the road of workflow integration. But componentized applications that share resources, that can be center-stage, or waiting in the wings, ready to compute or display as and when required, that would be something.
New Orleans is steeped in both polystyrene cups and magic. My own personal gri gri is a Motorola Timeport cell phone. Three-band technology allows it to operate in Europe and the US. In the New Orleans central business district where the Ernest Morial Conference Center is located, signal strength is pretty well on max. But cross over Canal into the French quarter and there’s nothing. Now that’s what I call voodoo!
Petris’ plans to merge with Application Sevice Provider (ASP) GeoNet Services, revealed in the September issue of PDM, have been thwarted. Late last month, GeoNet closed its doors for good.
GeoNet had an innovative business model as a high profile advocate of upstream e-business. The idea was to offer end-users access to software on a pay-as-you-go basis, eliminating costly up-front license fees.
In the event, GeoNet failed to reach critical mass and its backers were not prepared to fund the company through the merger with Petris. Recent events did not help, as GeoNet president Eric Deliac told PDM, “Following the takeover of GeoNet shareholder ISIS by Coflexip, and the attack on the World Trade Center, raising further finance has proved impossible.”
Petris is still planning to resuscitate GeoNet’s business and intends to couple its ASP offering with the Petris Winds Enterprise data management system.
Petris president Jim Pritchett told PDM, “Our plans remain as reported in PDM, except that not all the shareholders are participating in the additional investment (only ours). We have hired some of the key and former GeoNet employees, including chairman Pat Herbert, and are starting an ASP service at Petris with the same product vision. We will keep the name Petris.”
GeoNet’s demise is likely to be felt strongly by some of the 70 software vendors that were hoping to use the ASP service. ASP offered smaller vendors the chance of reducing their individual marketing and support effort, by working through the GeoNet hub.
What remains to be tested is the viability of an independent ASP business in the upstream. With Schlumberger’s Livequest and Landmark’s GrandBasin, the major vendors offer their own ASP service. Although a pay-per-use service for smaller vendors appeared attractive, GeoNet’s high profile failure has likely dented confidence in the new technology.
While Schlumberger’s takeover of Sema may not have impressed the stock market, it has had an effect on Halliburton. On the heels of Schlumberger’s foray into large-scale systems integration, Halliburton has announced an expansion of Landmark’s long-standing relationship with Accenture.
This will now encompass business transformation, outsourcing, consulting and project management. Landmark, through its GrandBasin unit will provide hosted applications and data management. The companies will focus initially on five operational issues: technical to business integration, decision-making, process and knowledge management, and outsourcing.
Speaking to the investment community, Halliburton CEO Dave Lesar said, “Teaming with Accenture will leverage Landmark’s offering and let our organizations pursue large-scale data management and outsourcing contracts. We will have similar announcements with other systems integrators in the future.” Lesar contrasted Halliburton’s strategy with ‘the competition’ by claiming that the same synergies would be achieved “without buying the company.”
PDM - What was the background to your work on the Eclipse simulator?
Cheshire - After a PhD in physics from Glasgow University, I worked with NASA, computing atomic particle trajectories before joining the UK Atomic Energy Authority (AEA) in Harwell. I was tasked with finding commercial uses for Harwell’s substantial computing resources. This led to the development of the Programmable Oil Reservoir Simulator (PORES) for the UK DOE, a project funded by Britoil and British Gas.
PDM - And how did Eclipse start out?
Cheshire—I met Ted Daniels (owner of Exploration Consultants Ltd.) and began work, along with AEA colleagues John Appleyard and Jon Holmes in 1980. ECL’s Implicit Program for Simulation Engineering (Eclipse) was rolled out to its 3 first clients (in Australia! - BHP, Santos and Woodside) in 1983.
PDM - We remember the early marketing effort that ECL put into Eclipse, how quickly did it take off commercially?
Cheshire - The Eclipse brochures and newsletters first caught Statoil’s eye. They had a problem with a horizontal well on the Snorre field which ours competitors couldn’t handle. Eclipse did, after we had burnt the midnight oil working on horizontal well extensions. Subsequently, Statoil provided much input into Eclipse’s development, to the extent that Eclipse became a ‘Norwegian product,’ with further sales to the NPD and Saga. The North Sea, with very high well costs, was a good environment for reservoir simulation. Oil and gas companies wanted quantitative results before development drilling.
PDM - What differentiates Eclipse in the marketplace?
Cheshire - Eclipse’s initial success was due to its ‘fully implicit’ computation technology. Many of our competitors are only now going implicit. Today, our success is due to Eclipse’s fast numerical efficiency. Our substantial investment in R&D has added on average two new features per year. ECL’s geological consulting business has helped too, bringing the simulator closer to geology.
PDM - We have been seeking signs at the SPE of the integration of time lapse seismics with reservoir simulation—without much success so far?
Cheshire - Schlumberger has being doing a lot of work in this area - particularly with Eclipse’s SimOpt history matching module. This now features 4D seismic matching.
Jim Flynn, head of Simulation Product Planning with Schlumberger Information Solutions announced the roll-out of Eclipse 2001 – the 20th birthday edition of Schlumberger’s market-leading numerical reservoir simulator. The 2001 edition brings additions and enhancements to FrontSim, SimCube and PlanOpt.
FrontSim is Schlumberger’s streamline simulator. Streamline computation is a simplified way of computing fluid movement in the reservoir and is more suited to calculating flow in million-cell geological models than the more rigorous finite-difference technology of Eclipse. FrontSim has been extended to a three-phase black oil mode, an advance made possible by coupling FrontSim with Eclipse to generate fully implicit solutions along the streamlines.
Near well bore
NearWellBore (NWB) is claimed as the industry’s first interactive solution for fast, detailed flow modeling near the well bore. NWB uses prior full-field model results to account for flow into and out of the local volume of interest.
SimCube, an Open Spirit-enabled application, brings simulator results into GeoFrame applications. The SPE demo displayed simulator-generated attributes such as water saturation in Schlumberger’s GeoViz – along with the 3D seismic data.
PlanOpt is a brute-force calculation engine, originally developed by Agip which tests and ranks hundreds of possible drilling well locations, generating production forecasts for each hypothetical well.
The parallel versions of Eclipse 100 black oil reservoir simulator and Eclipse 300 compositional and thermal reservoir simulators are now commercially available on Windows and Linux. They can be deployed on an ad-hoc network, or on a bespoke Linux cluster. Cross-platform file compatibility means that pre-processing, simulation and post-processing can be run on different machines.
The pre and post-processor applications have seen a range of usability improvements. PVTi pressure-volume-temperature analysis software has a revamped user interface that simplifies data entry and reduces turnaround time for fluid analysis.
Real soon now!
Current development focuses on borehole geomechanics, and 4D seismic-controlled history matching with SimOpt. Integration with surface facilities leveraging the Baker Jardine acquisition is also in the planning stage. Finally, workflow integration is to be improved “so that it doesn't seem as if you are going from one application to another all the time.” That’ll be the day.
Since it was founded in 1987 by two Flopetrol-Johnston engineers, Paris-based Kappa Engineering has carved out quite a niche for itself in the field of well test and production log interpretation software.
Sales of Kappa’s ‘Saphir’ well test and ‘Emeraude’ production log interpretation applications have grown by an average of 20% per annum for the last 10 years. Kappa now claims over 2000 active licensees in some 300 companies worldwide. Kappa clients include oil majors, but its best clients are service companies such as Schlumberger and Halliburton, even though both have competing products.
Olivier Allain told PDM that Kappa is currently working on a large-scale reservoir simulator. The intent is to enter this market gradually, not as a head on competitor with Eclipse. The product will start out as a out as a black oil, PC-based application. More from www.kappaeng.com.
Decisioneering is to add real options-based analysis to its Crystal Ball financial modeling software. Real option analysis is similar to conventional net present value (NPV) and return on investment (ROI) calculations, but adds an extra dimension to financial modeling. For many projects, participants may acquire the right, but not the obligation, to invest.
Drill or drop
At any time participants have the option of carrying on financing, or of dropping out of the project. In oil exploration such ‘options’ may or may not be exercised as and when new information about an asset becomes available. If you can afford to wait until a well is drilled on a look-alike prospect on the block next door, and then to drill or drop, then the uncertainty and financial exposure of your investment will be greatly reduced.
Crystal Ball Real Options (CBRO) will be launched on December 15th. According to Decisioneering, interest has already been expressed by BP, and other majors. A link from Merak’s Peep to CBRO will also be announced. More from www.decisioneering.com.
UK Trade and Industry Secretary, Patricia Hewitt has announced £ 2.4 million funding for the UK Oil Portal (see PDM Vol. 5 N° 12). The UK Oil Portal is described as an ‘ambitious e-commerce development designed to make the oil and gas industry’s essential business with Government easier, faster and smarter.’
The UK Oil Portal will allow key oil and gas business processes, such as applying for consents, approvals and regulatory reporting, to be done electronically ‘making life easier for industry.’
Hewitt commented, “It is vital that business and Government make the most of cutting-edge technology, such as the UK Portal, to make daily business easier and faster.”
The Portal is funded from the Government’s Capital Modernization Fund and the current allocation covers the next two years. The system is already up and running but will be further developed and refined with the new money.
Well Data Technologies’ new Well-Inform software uses the Internet to provide onshore and offshore workers with real-time information on drilling operations. Well-Inform tracks people, equipment, assets, operations and costs and connects workers irrespective of location.
Key subcontractors and regulatory authorities can be given controlled access to the system. Along with the raw data acquired during drilling, Well-Inform captures daily reports, lessons learned, costs and other operational information.
Well Data Technologies claims to demonstrate substantial cost savings through the use of its software through improved equipment logistics, reducing reporting burdens and the creation of a corporate knowledge base. The system was prototyped in the Celtic sea off Ireland where regulatory bodies mandate online access to mud logging data. LAS mud logging and WITS data can be streamed for onshore display. More from www.welldatatech.com.
Esso Exploration has selected Schlumberger’s IndigoPool to list assets from its global oil and gas portfolio. Esso’s offerings will include farm-outs, divestments, and trade opportunities with asset details and contact information.
Shell has also signed with IndigoPool in a corporate agreement to provide services and technology to Shell locations worldwide. The contract will be administered centrally out of the Hague and enables Shell business units to procure IndigoPool services on an as-needed basis.
Andersen’s Petroleum Services Executive Oil Briefings for the Gulf of Mexico, Nigeria, East Africa and Australia are now available for download. Field Reports for Europe and country-specific Reports for Brazil, Gulf of Guinea and Kazakhstan are also available for purchase.
Waterous & Co. has a non-confidential demonstration offering including Data Book and Data Room available for review online. More from www.indigopool.com.
Schlumberger Oilfield Services (SOS) has opened its Houston iCenter collaboration and virtual-reality center. The new, secure collaborative facility enables experts to maximize the use of real-time initiatives to enhance decision-making and planning.
SOS Americas president Dave Mullen said, “The iCenter will help clients make informed decisions to improve well productivity and reduce uncertainty. This latest deployment of our iCenter gives our clients access to Sclumberger’s leading-edge immersive technology.”
iCenters clients can use services and technologies, such as Interact Web Witness, PowerSTIM, NDS ‘No Drilling Surprises’, geomechanics, GeoFrame and IPAnywhere for remote monitoring of production data.
Schlumberger has other implementations of the iCenter in Cambridge, Ridgefield and Stavanger.
Conoco has selected Schlumberger to consolidate its IT contractor services in a contract valued at approximately $300 million. Schlumberger will be Conoco’s global IT provider for the next six years.
Conoco CIO Tom Nicewarner said, “Having a single, global IT contractor will offer long-term cost benefits to Conoco by enhancing quality of service and generating consistent products and services.”
50 Conoco employees will join Schlumberger. Most non-Conoco employees currently working for other contractors will be offered jobs.
Schlumberger Network Solutions president Xavier Flinois said, “This demonstrates our focus on business transformation through IT technologies and services. Our global network and managed service infrastructure, will be well adapted to Conoco’s requirements.”
Burlington Resources has chosen Halliburton unit Landmark Graphics Corp. to improve its technical data analysis and interdisciplinary integration. The multi-year agreement will provide Burlington with increased access to Landmark’s leading-edge software solutions and consulting services.
Landmark president and CEO of Landmark John Gibson said, “We are excited about working closely with Burlington and believe that our two organizations will ensure that knowledge sharing and technology transfer becomes a consistent process across Burlington Resources. This agreement will speed Burlington’s technology take-up while maintaining its leading-edge philosophy.”
John Williams, Burlington Resources’ senior VP Exploration added, “Growth through the drill bit requires technical and operational excellence as a foundation. Our technology agreement with Landmark will provide Burlington with access to a fully integrated, state-of-the-art software suite that will enable our technical staff to analyze opportunities quickly and efficiently. Standardization of the platform and approach will facilitate technology transfer between our operating divisions worldwide.”
A global technology steering team consisting of Burlington’s chiefs of geology, geophysics engineering and Information Services and Technology and Landmark representatives will set enterprise-wide standards and help lead Burlington’s change process.
The SPE is one of the definitive events on the upstream calendar and assembles some big hitters for its plenary session. This year top executives were invited to pontificate on “the global oil industry in the 21st century.” All saw a rosy future for oil over the next few decades. Kuwait Petroleum CEO Nader Sultan sees steady demand growth grow of 5% per annum. Sultan quipped that Energy, not e-commerce, underpins the economy - “You can't have B2B without BTUs!”
Exxon’s Harry Longwell anticipates a novel, non-oil energy source arriving in 30-50 years time. Meantime, oil and gas ‘will dominate energy supply.’ But Exxon forecasts suggest that 10 years from now, half of the oil that will be used is not currently in production. Getting this new oil and gas on stream will require a $100 billion per year investment over the next decade - a huge increase on today’s spending. Tom Langford of Morgan Stanley suggested that investor sentiment is returning to the oil sector. He illustrated this with a graphic showing the weight of oil and gas stocks in the S&P 500.
Weight (%) of oil stocks in S&P 500
It is extraordinary how Schlumberger’s stance on Open Spirit has evolved over the past few months. Earlier this year Open Spirit was ‘tolerated’ as a means of integrating non-GeoQuest applications. Now the platform is everywhere. Is Open Spirit to replace GeoFrame as Schlumberger’s integration ‘Framework?’ It looks that way, as increasingly Schlumberger leverages the Open Spirit (OS) integration layer to connect products as diverse as the Omega seismic processing system, the InterAct WellWitness rigsite activity monitor, and its growing number of ’Cube applications. Of particular note is the OS-enabling of SimCube - opening the reservoir simulation world of Eclipse to the upstream. Schlumberger is touting Open Spirit so much that one has to suspect a degree of marketing hype. No doubt Landmark’s continued refusal to play ball with OS provides some momentum to this effort!
The dot-coms may be in trouble, but e-business is actually booming, particularly in the field of web-based monitoring and control of drilling rigs and production facilities. Datawise’s TruVu Pro uses the web to acquire and manage real time drilling data onshore and offshore. The system acts as an electronic drilling recorder, for wireline, mud and production logging. Rig-site data can be accessed anywhere from a browser. TruVu offers a variety of display options from digital dials, ‘kill well’ displays to graphs and reports. TruVu uses the WITS data exchange standard and is used by Schlumberger to log its MWD systems.
Epoch’s MyWells.com promises remote viewing of daily reports, electronic tour sheets, drilling and mud logs. A user-friendly interface allows for selection and browsing. If required, the system will work even over slow dial-up connections. Data is collected via satellite and stored on the Epoch hub. Secure access allows control over who sees what.
The $10 million website
Outgoing president Bruce Bernard described the SPE’s mission as ‘collecting and disseminating technology.’ The new SPE.org website is designed to fulfill this mission. Bernard claims ‘IT is not our business.’ So development of the site was farmed-out to Autonomy, Vignette and the Socius Group. The website sets out to make technical information more useful and accessible to ‘constituents’ - i.e. both member and non-member visitors. The SPE.org project has a $10 million budget and will go live in the week of 5th November 2001 with a new industry-specific search engine, lifetime email and a personalizable interface – ‘mySPE.’ Autonomy’s ‘Portal in-a-box’ is the core technology deployed.
Bill Marko of the Oil & Gas Journal Exchange presented a pertinent review of shareholder return on upstream capital investment. Peer group comparison of the majors shows 5-year shareholder returns in the range of 17-19% for market leaders Shell, Exxon, TFE and BP. Large independents come in with similar returns. Smaller independents show more variability - range +40% to -20% (Chesapeake). Note that returns are driven by acquisitions (for all peer groups). Marko’s talk was a good antidote to the old canard that the industry produces lamentably low ROI.
IHS Energy Group’s Pete Stark showed how far you can go in portfolio evaluation - without even approaching a target. Using IHS’ Probe and Peps applications, the case history involved Agip’s analysis of the British Borneo and Lasmo portfolios. From a world map view, reserves and production data are shown by stakeholder as pie charts. Potential acreage synergies are immediately highlighted, and consolidated portfolios can be built to test what-if scenarios.
Web based SCADA
Lynx Technologies’ eLynx is a web-based SCADA system for well automation and remote surveillance. The eLynx service has been up for one year and currently is monitoring 1200 wells. eLynx provides hosting and web enablement for clients including Baker Hughes and Lufkin.
Maurer Technology has packaged its Drillers Toolkit for use at the rig site on the Compaq iPAQ Pocket PC. Around 100 software utilities are available for computing bottom hole assemblies, casing design, costing, mechanics and hydraulics, mud, well trajectories, torque and drag and well control. The Pocket PC toolkit costs $1995 and includes an iPAQ 3650 with color screen.
ProDataOnline (PDO) is described as a Data Service Provider. PDO is a PDA*- based data capture system coupled with a hosted SQL Server database. A pumper enters data onto the PDA in the field, which is transmitted over a dialup connection to a secure SQL Server 7 database hosted by PDO. Clients can log in to the database - and produce graphs and reports.
ScienceSoft’s S3 Graph - provides easy to use post-processing and analysis for simulator output. Drag and drop a dozen different file formats to compare for instance, observed and simulated production profiles. Or view a simulated grid along with well locations and design a well list. In house simulator packages can be read and integrated into S3 Graph. Clients include BP, Shell, Exxon, Texaco and TotalFinaElf.
Scandpower - known for its MEPO automated history-matching tool - is one of the few companies to have hands-on experience in integrating 4D seismics with reservoir engineering. But Scandpower believes that a product is still ‘two years away’ from commercialization.
Founded in 1997, by partners Lockheed Martin and Cable & Wireless, the M2M Matrix is described as ‘The Industrial ASP.’ The company provides remote monitoring and control services leveraging the “anywhere to anywhere” nature of the Internet. M2M claims an ‘unequaled’ offering in last mile connectivity. M2M solutions for oil and gas target production and other operations. Schlumberger is a major client.
PetroleumPlace’s AssetExplorer (AE) electronic data room was rolled out at this year’s AAPG. AE uses OpenJournal to access textual information on an asset. CGM, Acrobat PDF and regular Office file formats can be uploaded. Four service levels are on offer - from a simple listing, to an invitation-only online interpretation environment. A branded version of AE is in use at Unocal.
InteractWebWitness (IWW) offers secure access to information, alarms, emails and real-time data from the well site into an Internet browser via the web. IWW is Open Spirit-enabled for connection to desktop interpretation systems. On well abandonment, all IWW transactional data can be backed-up to a CD or archived to LogDB. Morning drilling reports (in pdf format) can be viewed. The Drilling Console offers a driller-type display of weight on bit, mud volumes etc. A log console does the same for logging data, and alarms can be set for events such as resistivity going over a set value. Frac jobs and well tests can be monitored in real time.
SpudIT.com provides real-time data on contractable rigs through its website. SpudIT knows where rigs are operating, because they have GPS transponders on participating rigs. SpudIT claims 3,300 of the estimated 5,000 rigs operating in the Americas and 80% of US land rigs. A complementary service - RigAlert identifies rigs with unexpected openings in their schedule. Another tool - RigMapper provides a GIS interface to SpudIT’s database. SpudIT uses asset tracking technology from American Millennium Corporation, Inc.
StreamSim integrates GOCAD
StreamSim has integrated 3DSL into the GOCAD/JACTA environment allowing for simulation on fine-scale models. Jacta computes the static uncertainties in the model while StreamSim’s 3D Stream Line (3DSL) brings uncertainty into flow modeling. 3DSL is claimed to be a fast way of ranking and screening full-field models to show how geology, structure and petrophysics combine to influence fluid flow. Color coding shows drained volumes and fluid paths between injectors and producers. Output to Excel allows plots of uncertainty in the dynamic model.
WesternGeco - Qmarine
We were looking for real-world use of 4D seismics in reservoir monitoring, but found little. Instead we were shown some of Schlumberger’s Q-Marine technology that has been developed for 4D acquisition. WesternGeco has studied factors influencing 4D repeatability and found that streamer and source positioning is a major limiting factor. Q-Marine’s Q-Fin allows a streamer to be re-positioned in its original acquisition configuration - independent of the current sea conditions. WesternGeco’s Leif Larsen showed PDM a great Power Point of location data from 6 streamers. These were ‘driven’ into position during shooting, to match exactly the previous survey. A new Q-Marine boat, the Western Pride, has just been commissioned and will deploy 8 streamers, each 8 km in length, with around 20,000 channels.
World Markets Research Center
Established last year, World Markets Research Center’s (WMRC) Energy Sector offers corporate clients web-based access to legal, regulatory, environmental, legislation and news in (mainly) emerging markets. The Energy Sector is broadly defined to span oil and gas, electricity and utilities. Energy sector clients include Texaco, TotalFinaElf and Schlumberger. WMRC signed its first corporate intranet deal earlier this year with an energy sector client taking a license for 250 concurrent users.
Hamish Wilson of Paras Consulting presented a paper co-authored by Tim Marchant and David Bamford of BP on the evolution of BP’s near field* exploration program. During the late 1980’s and early-mid 1990’s, pre-merged BP and Amoco invested large sums of money exploring close in to their core producing fields in traditional ‘heartlands’ such as the North Sea, Alaska and the lower 48. These investments were largely unsuccessful. Amoco coined the term ‘stealth exploration’ to describe the activity carried out by individual assets. The cost of failure only later appeared on the corporate balance sheet as exploration write-off. Horror stories abounded - such as $13/bbl finding costs in Canada and Amoco’s infamous ‘Natural Gas Strategy.’ Both the Canada and Egypt units had ‘near-death’ experiences.
Recent industry focus on boosting short-term production has reawakened interest in near-field exploration. Despite the corporate perception of failure, it became apparent that some business units, notably Canada Gas and Egypt Oil, were making a quiet success of near field exploration. BP engaged Paras Consulting to investigate what was behind these successes. The key conclusion to be drawn from this story of ‘corporate learning’ is that near field exploration in large companies can make money provided three actions are taken:
Do not compromise on subsurface technical risk in the face of pressure from engineers and others attracted by the economics - an investment with a positive EMV** or high RoR*** with a high technical risk is still a high-risk investment.
Manage the activity as an integrated part of the production asset to minimize cycle time.
Set tight performance metrics and manage the portfolio globally.
BP checked out these findings by allocating a limited amount of seed capital to five business units where it had a dominant ownership of the regional infrastructure. This diverse group of upstream businesses has successfully managed a limited exploration program and demonstrated that near-field exploration can be controlled and can add value through short-term production.
50% success rate
Today, exploration is only approved where a success rate of over 50% can be assured. The production from such near field exploration is anticipated to fill the gap between BP’s declining historical ‘production capital’ and new production that has yet to come on stream.
* ‘near field exploration’ is conducted in the vicinity of existing operated production, and benefits from the economics of nearby infrastructure.
**EMV - expected monetary value
***RoR - Rate of Return (on capital)
Technoguide’s demonstration of ‘seismic to simulation’ using Petrel was a real tour de force in integrated data visualization. Petrel has adopted a generic approach to visualization as shown by placing a photo of the demonstrator at the rear of a seismic volume cube. This was then draped over the top reservoir surface, an action of little apparent use. But swap the draped image for a map of water saturation from the simulator – and suddenly you get the idea.
Using ‘commodity’ (i.e. PC-based) hardware, Petrel allows disparate data types to be viewed in an arbitrary fashion. Technoguide is steadily evolving Petrel from passive visualization into a real interpretation environment. Autopick of seismics is achieved in a visually interactive manner, allowing for QC of the 3D geological model before input to the simulator. Fault mapping is the key; fault ‘pillars’ can be digitized and molded to the fault plane. Seismic data can be paged in to check fault positions. Pillars on intersecting faults can be joined – to ensure a space-filling interpretation.
Horizon data is then imported – and shortfalls and overlaps are fixed. Once the structure has been fixed, seismics is brought back for attribute and isopach mapping of conformable reservoir limits. A variety of tools such as fence diagrams can be used to view arbitrary combinations of model, attribute and seismic data. Geo-bodies can be inserted with geostatistical techniques allowing a variety of body geometries. Horizons can be generated with ‘erosional rules’ to map truncations, erosion and other trends.
A movie player allows time-lapse simulator runs (not seismics) to be animated. Again, the seismics can be recalled to check apparent production barriers. The grand finale was a flight through the reservoir – just digitize your flight-path and off you go. Cute help pop-ups added to Petrel’s ‘star of the show’ status. A nearly flawless demo except for the painfully chintzy background music.
Schlumberger Information Solutions unit GeoQuest, has signed a worldwide sales and support agreement with Production Geoscience Ltd. in respect of its Interactive Petrophysics (IP) log analysis software.
IP is a portable application for PC-based log analysis that allows geoscientists and engineers to determine porosity, water saturation and other reservoir parameters at the rig site.
The next release of IP will be Open Spirit-enabled and will support a ‘seamless workflow’ between IP and industry-standard project databases. Frank Whitehead, principal consultant petrophysicist with PGL said “With GeoQuest’s sales and support infrastructure, IP can reach a global market, letting us concentrate on software development and enhancements.”
Interactive Petrophysics offers a variety of saturation and porosity models, drag and drop functionality, easy zone editing and user-defined model building. IP also provides advanced statistical curve modeling using fuzzy logic to estimate missing log curves, and the industry’s first practical Monte Carlo analysis system to give quantitative measures of log analysis errors. Based in Banchory, Scotland, PGL was founded in 1990. More from www.pglweb.com.
A new haptic (force-feedback) interface for GoCad has been developed by Chevron Petroleum Technology. The device uses a ReachIn stereo display, tilted downward over a horizontal mirror. With stereoscopic glasses, the user sees the 3D model below the mirror.
One hand operates a Magellan Space Mouse to navigate and orient the model. The other works a Sensable Technologies Phantom force-feedback controller, located below the mirror to control a ‘virtual stylus’ that appears in the earth model.
Because the actual stylus and the virtual model are located below the mirror, the haptic pointing hardware is co-located with 3D cursor in the stereoscopic GoCad model. This contributes to a natural and realistic interaction with the virtual world. A prototype of the 3DH product was demonstrated at the 2001 GoCad User meeting this month. More from www.reachin.se.
The Petroleum Open Software Corporation (POSC) has announced that Oil & Natural Gas Corporation Limited (ONGC), India’s national oil company, has joined. Established in 1956 by the Indian government, ONGC has grown into a horizontally integrated upstream petroleum company with in-house capabilities and infrastructure in the entire range of oil and gas exploration and production activities.
ONGC’s Director of Exploration Yogesh Sinha said, “The upstream industry, with the help of POSC, is moving vigorously towards E&P data management and associated work flow standardization and ONGC is pleased to join POSC in catalyzing these efforts.”
“ONGC has taken up major information management initiatives E&P and support functions such as material management, HRD & finance. It is important for us to leverage benefits from collaborative efforts and best practices in upstream industry. In the present era of globalization and the opening-up of the Indian petroleum industry to international participation, our association with POSC helps us follow industry standards. We look forward to a long and active relationship with POSC” said Sinha.
POSC membership has dwindled in recent years to a meager five commercial, and three national oil companies. More enthusiasm is seen in the service sector – with 21 members and in the not-for-profit sector with 22. ONGC is India’s largest producer of crude oil, natural gas and LPG. More from www.ongcindia.com and www.posc.org.
POSC is offering members and non-members the chance to comment on new specifications aimed at standardizing geological zonation models for subsurface interpretation. The Interval Properties (Zonation) Draft Specifications are intended for subsequent deployment within the Open Spirit framework.
The zonal specifications, a joint effort by Shell and POSC, cover distributed object models and component architecture. A secondary objective is to develop immediately XML schemas for sharing stratigraphy and zonation data over intranets and the Internet. The project leverages work done by Shell’s SEPTAR unit on a basic zonation object model and related documentation, and POSC’s earlier interoperability work.
Interval properties are used by oil companies and in much commercial software as the basis of geoscience processing and interpretation. A standard zonal model is said to be ‘essential for the widespread acceptance of a set of industry standard Subsurface Interpretation business objects.’
Companies have a sixty day period to comment on the draft which is available on the POSC website, www.posc.org.
GlobalView Software Inc. has announced an adaptor for companies using the TIBCO hub enterprise application integration backbone. The new adaptor allows for two-way data flow with GlobalView’s GlobalData server, offering other applications on the TIBCO hub access to real-time and historical market information.
GlobalData currently offers access to real-time and historical data from Standard & Poors, ComStock, DTN, Dow Jones Newswires, Platts, Petroleum Argus, OPIS, Gas Daily, Megawatt Daily, PH Energy, APPI, RIM and EA Gibson. Other data and online exchanges will be integrated in the future. Customer-owned proprietary data sources can also be incorporated.
The GlobalView TIBCO adapter provides a programming data interface (API) that allows two-way data flow with the GlobalView server. The interface lets other applications use the GlobalView data server for both import and export of market information. This enables businesses to integrate their business systems in real-time.
GlobalView Software has delivered its adapter to Reliant Energy of Houston, Texas, to provide real-time data from the GlobalView servers to the Reliant trading order management system, its risk management system and soon, to its intranet and extranet portals. More from www.gvsi.com.
UK-based Exprodat is to open a technology company in Denver, Colorado. The US affiliate will focus on, and expand the technology capabilities that lead to the development of web Open Works (wOW) which was sold to Landmark Graphics earlier this year.
Using a rapid application development framework, Exprodat Technology Inc. will assist its clients with bespoke information management (IM) developments, in particular dynamic Web-based systems. The company will also establish other IM service lines, including Intranet portal assessment and design.
Exprodat Technology president Bruce Rodney said, “This is a great opportunity for the company, as the US is the center of E&P software development. What makes Exprodat unique is that our skills focus on the intersection between horizontal IT and the vertical E&P domain. We are able to deploy horizontal, Web-based technologies in E&P faster and more effectively than larger or more general IT companies because of our intimate domain knowledge and years of experience.”
Exprodat Limited will continue to provide independent IM consultancy services to the upstream E&P business. The company will be relaunched early in 2002 as Exprodat Consulting Limited. Gareth Smith, Director of Exprodat Limited commented, “the new company structure allows us to continue delivering high quality, independent consultancy outside of our product development business”. More from www.exprodat.com.
CGG is launching what is claimed as ‘the first fully anisotropic seismic data processing service’ under the brand name “A+.” A+ will exploit the earth’s anisotropy in order to deliver ‘a sharper, more focused’ image of the reservoir and give ‘greater insight’ into reservoir properties.
Anisotropy is caused when seismic velocities are dependent on direction. In the past, seismic processing systems have neglected this phenomenon, producing poorly-focused seismic images. CGG’s new technology takes full account of anisotropic velocity fields and produces a sharper image.
Guillaume Cambois, executive VP of data processing and reservoir services said, “A+ is another technical innovation from CGG following the launch of 4Sight, our integrated 4D processing and reservoir services, the port of Geocluster to Linux and our success as the sole provider of on-site 4D processing centers.” More from www.cgg.com.
Computer Modeling Group (CMG) has announced the beta release of IMEX II (that’s a ‘parallel sign, not a roman ‘2’), its PC-based parallel processing reservoir modeling solution. IMEX II adds parallel processing capabilities to CMG’s first generation three-phase black oil simulator, IMEX.
Colin Card, CMG’s Director of Applications and Support said, “This new capability will significantly reduce the amount of time required to perform a full field history match and production forecast, resulting in significant cost savings for our customers”.
IMEX II simulator will take full advantage of cost-effective dual-processor PC workstations through CMG’s generalized parallel sparse solver, Parasol. IMEX II promises a 150% speed increase using a dual processor. CMG has offices in Calgary, Houston, Beijing, London, and Caracas. More from www.cmgl.ca.
CGG has appointed Bertrand Chavane as manager of its Paris data processing and reservoir services center. Chavane was previously Geovecteur product manager in the technology division. Cato Bolstad, previously the manager of a client-dedicated center, is now manager of the London center.
Charles Matthews has joined IHS Energy Log Services as Account Manager in New Orleans. Dave Thompson, from IHS Energy Group’s UK subsidiary, is to manage the newly opened Beijing office.
Craig Narum and Bill Diggons have left Landmark to form O&G Performance Advisors, offering consulting services around corporate planning and reselling a third party tool (PolyVista) for data mining.
T-Surf has appointed Taoufik Ait Ettajer as General Manager for its new Middle East unit located in Dubai.
LOGIC has hired Catherine Beardslee as e-Business Advisor.
The new SPE president is Stephen Holditch. Holditch was Chairman of Holditch Associates before it was acquired by Schlumberger in 1997. New SPE Executive Director is Mark Rubin - previously with the API.
PPDM has put the results of its work on XML data modeling on its web site for review by members and non-members. Samples show how XML is used to describe a ‘business associate’ (a contractor or partner) and how the technology can be used to move data between different databases and applications.
The Business Associate Schema defines the content and structure of the Business Associate transaction in XML. Three support schemas contain common, reusable element definitions. Support schemas are used to help validate the contents of an XML document. Check out the PPDM XML work at www.ppdm.org.
Landmark has extended its knowledge management software into the field of well design and drilling. 3D DrillView (3DDV) is a Windows-based visualization environment for geological, geophysical and drilling information. 3D DV provides a new approach to well planning, early identification of drilling hazards and real-time decision support during the drilling phase.
3DDV offers a 3D view of the subsurface with a series of ‘boxes’ located in space and along the well bore. These boxes are a visual analogy for boxes of paper data. Clicking on a box can bring up a list of documents or other information that is pertinent to that spatial location. The tool is real-time enabled, so that data from a currently drilling well can be viewed. 3DDV is a 3D equivalent of Landmark’s Knowledge Reference System - which performs a similar job on a 2D map view.
The software was developed with support from BP whose Anne Drinkwater commented “Staff from BP have been involved from design through pilot testing of the first prototype version. 3DDV is key technology for bringing together multidiscipline teams to help plan our future wells and use all the available information.”
3D Drill View integrates Landmark’s DIMS well history data with the OpenWorks earth model to enhance field development strategies, promote safety and to anticipate drilling hazards. Such benefits are achieved by reviewing historical drilling problems and creating contingency plans before drilling is initiated.
Landmark president and CEO John Gibson said, “Linking engineering tools with knowledge management will allow engineers to focus and apply previously recorded field and well data, and assist them in developing improved well plans while avoiding potential hazards. The combination of better planned wells and a reduction in hazards yields an instant savings both in dollars and in time for our customers.”
Landmark VP Bill Sanstrom added, “3D Drill View dynamically displays three-dimensional real-time updates of well trajectories and log curves from MWD/LWD drilling services. This results in direct, real-time comparison of planned versus actual information, and allows for improved decision-making during drilling operations.”
Norsk Hydro has awarded Roxar a software contract for a total value of 50 million NOK (about $ 5.7 million) over a five year period. The agreement gives Norsk Hydro’s Exploration and Production division world-wide access to Roxar’s reservoir modeling software, Irap RMS.
Tom Henriksen, Hydro’s Director of Information Systems said, “This agreement is important to Norsk Hydro as it provides our world-wide staff with unlimited access to Roxar’s business-critical system, Irap RMS. RMS will enable us to build better 3D sub-surface models more quickly thanks to a standardized workflow.”
Roxar’s COO Sandy Esslemont added, “This contract represents a milestone to Roxar, and reinforces Norsk Hydro’s confidence in Roxar’s software technology and services. The agreement confirms that Irap RMS is no longer a tool for a limited group of experts within E&P companies, but can be used by geoscientists and engineers in day-to-day operations. We have developed robust solutions for reservoir management in close co-operation with our customers, including Norsk Hydro. In the future, Roxar will continue to break down technological barriers and to provide first class services and support to reservoir modelers.”
The contract is a continuation of the established partnership between Norsk Hydro and Roxar to implement the complete Irap RMS portfolio as a standard tool for 3D reservoir modeling within Norsk Hydro. Under this new agreement, all of Norsk Hydro’s 600 geologists, geophysicists, and reservoir engineers can access the Irap RMS portfolio on Unix workstations, and PC’s.
Roxar provides reservoir modeling software and services to more than 150 global E&P companies, consultancy companies, and universities. Roxar’s Irap RMS modeling tool is deployed within ‘most major’ E&P companies world-wide.