The European edition of Schlumberger-GeoQuest’s GeoForum user group meeting was held in Paris this month. Slightly larger than its US counterpart, the Euro-Forum was attended by some 400 users from 37 countries. The keynote address from Thierry Pilenko went over what has become well-trodden ground for PDM readers. Pilenko is concerned over the low return on investment (ROI) in the oil and gas industry and like others, is advocating sophisticated economic modeling as a lever to improved efficiency.
But GeoQuest’s real strength is in the technology, and Pilenko spaded - out an extended offering, spanning networking (with technology from the recently merged Omnes unit), smartcards from Schlumberger and of course, the traditional E&P applications and data management solutions. The latter have all been given a shot in the arm by a variety of e-initiatives (see elsewhere in this issue.)
GeoQuest is to tie the whole thing together and repackage these and other services into e-commerce enabled offerings. Pilenko claims the modern oil co needs to “leverage, not necessarily own technology.”
GeoQuest has been doing some market research and in one survey, found that up to $50 billion of E&P assets will be traded over the net in the next three years. Pilenko wants the lion’s share of these transactions for GeoQuest.
Other surveys by the Dresner Bank and Forrester Research focused on smart card security. A massive move away from password protection (currently 95% of the market) to smart card technology is forecast over the next three 3 years and the new ‘Entrust’ plug & play smart cards for Windows are to make Schlumberger “a smart enabler of the digital revolution.”
Schlumberger is moving away from its product-centric focus of the past to becoming ‘information centric’. No more so than in the field of e-commerce, for which Pilenko estimates a 70% per annum growth rate for the next 5 years. Other key developments are in the fields of Application Service Provision (ASP) and data management – working with Open Spirit, POSC, BizTech for Energy and ‘other domain specific solutions’. Schlumberger’s aim is to be able to use the most appropriate delivery mechanism - ‘from motorbikes to megabits’ - as circumstances dictate.
An example is the PDVSA outsourcing project which supports 2850 users with 250 dedicated GeoQuest staff managing applications from GeoQuest and third parties. The secure private Schlumberger intranet (SINET), the second largest after the US military, ties it all together and conveys an estimated daily load of 500 GB of client data worldwide.
The economic high ground has been staked out with Merak’s software as the hub for decision support, while Open Spirit is the platform for integration of third party applications and datastores. A new seismic characterization plug-in ‘SeisClass’ aimed at the StratiMagic niche is in the offing. Schlumberger’s Knowledge Management offering is up and running with ‘MindShare’, the offspring of an internal K-Management product used by Schlumberger engineers. MindShare uses XML/LDAP based technology and will be commercialized later this year.
In a drive to reduce desktop IT costs Pilenko wants to take the “T” out of “IT” and by year end 2000 will have integration of technical computing with the desktop and Microsoft Office. A ‘PC Version’ of GeoFrame will be available by the end of 2000 but it is not clear what applications will be available on the PC. Other new offerings will be announced soon - especially repackaging Schlumberger’s PowerHouse data center and web-enabled applications into an ASP solution.
Portfolio Decisions Inc.
John Howell, president of Portfolio Decisions Inc. (PDI) described Portfolio Management (PM) as ‘a disciplined way of looking at your business’ which can provide insights and information for structured decision making. PDI has teamed with Merak (see page 5) to provide consulting and software metrics on net income, production forecasts, efficient frontier analysis (EFA) and on the probability of corporate goals being achieved.
Howell showed how EFA risk analysis can reveal volatility in Net Present Value computations. EFA is a great ‘descriptive space’ but is not so good for decision making where PDI’s Project Profiles are recommended. These shown that 90-95% of existing portfolios are in fact ‘infeasible solutions’ to achieving corporate goals.
Such analysis leads to concept of the ‘strategic project’ i.e. one which if removed from portfolio means goals will not be met. Howell underlined the conflict between central Portfolio Management and the delegation of authority to the business unit. No easy answer to this but ‘it must be addressed.’ Finally, to counter the skeptics, Howell quotes quality guru Edwards Demming who realized that “All models are wrong, but some are useful.”
Downstairs in the data management cellar, Bill Baksi set out the GeoQuest vision to ‘revolutionize upstream IT and decision making’. Data Management (DM) is one of the fastest growing business units in Schlumberger with a claimed 75% market share. The ten DM centers across the world are transforming into hubs for B2B e-commerce. Schlumberger DM clients include BP Amoco, Conoco, Deminex, Elf, Hydro, PDVSA, Pemex, Petronas, and Shell.
million barrel man
Yet another study has shown that between 250k and 1,000k bbl of oil and gas reserves are added per geoscientist per year. The ‘million barrel’ crowd are – you guessed all GeoQuest clients. Baksi categorizes such success as a straight line ‘from data management to the balance sheet.’
Andrei Kalininchev wants to make DM ‘transparent’ including access to ‘foreign’ systems such as Landmark, CGG and PGS. DM is part of a decision support environment and needs to be technologically neutral.
Finder 9 will have an OpenSpirit compliant well server. For those of you who are still holding their breath, GeoQuest be back populating the data store real soon now! The DM future promises personalized home pages, exposing a cut-down map interface where the user can select a well, view a scout ticket, download LAS curve data and view it in a browser. Another promise is for “Advanced Integration” i.e. a simpler application strategy avoiding the SeisDB, LogDB, Finder route by simpler “data-type lifecycle” data access
Project archival is promised for Finder 9.x in 2001 and an ArcView option will be available with Finder 9.0 in Q1 2001. DM will integrate the Merak and ERP environment in a similar timeframe. Kalininchev is eagerly awaiting the seismic “tsunami”! In 2000 there will be around 2 petabytes of new seismic data worldwide. In 2004 this will rise to an estimate 15 petabytes.
Columbia Data Bank
Alan Smith outlined the Columbian National Data Repository project. Ecopetrol, Schlumberger and Paras are collaborating on this data bank for all E&P data types. The software deployed includes all of GeoQuest’s data management tools - xxDB, Finder, SmartMap, GeoWeb and GeoFrame. Check out the project on www.bip.com.co.
PDM Comment – Pilenko’s strategy is to offer the whole enchilada in service provision. From outsourced data storage, through managed software and private networks to secure smart card access. Whether a client really wants to buy all this from one supplier is a moot point. It is also a moot point as to whether a single supplier really needs to ‘own’ all these technologies. With OMNES, Schlumberger has a special relationship with a network provider and the same goes for the Schlumberger smart card technology developed in-house. But some or all of this is, in reality, commodity service provision. Do we really want everything actually made by the same organization?
On another note, if as Baksi states, a geoscientist finds upwards of 250k bbl per year then the worst are finding around 10 times their cost per year! So why did they all get fired?
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