There’s no denying the fact that data and analytics are gaining steam in the oil and gas industry. Just look at what Accenture and Microsoft found from a recent survey of upstream oil and gas professionals:1, 2
- Two-thirds (66 percent) said analytics is one of the most important capabilities for transforming their company – even though only 13 percent said their organization has fully mature analytics capabilities.
- The number of respondents who said they are investing in the Internet of Things (IoT) nearly doubled from 25 percent last year to 44 percent this year.
- More than half (56 percent) said they plan to use the cloud to enable analytical capabilities in the next three to five years.
And it is not only happening upstream. Midstream and downstream operators also are interested in – if not already demonstrating – the ways that data and analytics can help improve their operations.
So what is driving this? Certainly, oil and gas companies see a significant opportunity to improve their operations. Better insights into processes can uncover issues and improve decision-making to help boost production, improve processes, minimize downtime and increase asset utilization. But data and analytics also can help companies contend with some of their greatest challenges, including:
A growing skills gap: Like other industrial sectors, the oil and gas industry is facing a skills shortage. Experienced workers are nearing retirement, and qualified young workers are increasingly hard to find to replace them.
Increasing operational complexity: Oil and gas producers are capturing hydrocarbons from new and more challenging locations, whether it’s deep, subsea reserves or tight geological formations. This is requiring more complex systems than ever – some with more than 200,000 tags of data and alarms.
Expanding regulatory challenges: Environmental and safety regulations continue to evolve as governments continue to put pressure on oil and gas companies to help prevent environmental damage and protect lives. This is only making compliance more complex.
Moving to a Connected Enterprise
The unconnected and distributed nature of oil and gas operations has traditionally limited companies in their ability to collect data. But this is changing as they adopt connected, information-enabled technologies and replace disparate networks with a unified network architecture.
This modern infrastructure – in which people, processes and technologies can be seamlessly connected across an enterprise that stretches hundreds or thousands of miles – is known as The Connected Enterprise. It embraces technology advances that include not only big data and analytics, but also open-standard IoT devices, mobility, virtualization and cloud computing. Most importantly, it creates nearly unlimited opportunities to improve and transform operations.
The Connected Enterprise presents the oil and gas industry some key opportunities:
- By collecting valuable asset data and contextualizing it into actionable information, oil and gas companies can empower workers with critical operational information and help them optimize equipment performance.
- Equipment data also can be used to more quickly troubleshoot issues, create predictive maintenance strategies, and better understand worker behaviors – all of which can help reduce downtime.
- Remote-access technology can be used to monitor remote wellheads, pump stations and storage sites, all from a centralized location. This can help reduce safety risks and costs associated with sending workers to manually check in on these systems.
These opportunities are not just theoretical. A number of oil and gas producers and operators are already demonstrating how connected, information-driven operations can improve their performance and solve business challenges.
Keeping Tabs on Offshore Operations From Afar
Even in the most remote and challenging environments, operations are expected to run around the clock. That’s certainly the case for one oil and gas company with offshore production platforms located off Alaska’s coast.
The company’s oil-drilling platforms use submersible pumps to help keep production running 24 hours per day. If they stop, production stops – costing the company anywhere from $100,000 to $300,000 each day.
To help reduce risk of downtime, the company upgraded to more efficient and reliable electrical submersible pumps, and used a virtual-support service to remotely monitor the drives that power the pumps.
The cloud-based service collects key equipment data, such as speed, current, power and voltage, and analyzes that data in real time. If any potential issues or failures are detected, a Rockwell Automation support engineer is notified immediately. The service nearly paid for itself in the first two weeks, as it helped detect and notify key personnel of four incidents in that time frame after implementation.
Refining Business Models Onshore
Onshore, the use of cloud technology is growing as a remote-monitoring tool, as well as for storing data, and analyzing and contextualizing information. For example: M.G. Bryan, a leading heavy-equipment and machinery supplier to the oil and gas industry, knew it needed a way to remotely monitor and maintain the performance of its $1 million fracking trucks. Downtime on the vehicles can cost $3,000 to $7,000 per day – and that’s before lost product revenues are taken into account.
The company invested in a cloud-based, fleet-management system. Using mobile technology and the seamless transfer of business information over the cloud, M.G. Bryan securely pulls data to web browsers. Then, the software management system produces reports and dashboards showing the condition of individual vehicle’s drivetrains and hydraulic fracturing performance. The system takes the guesswork out of maintenance scheduling, thus helping prevent unplanned downtime.
In addition, the instant visibility into remote-asset data has improved asset uptime and productivity for end users. It’s also allowed the OEM to shift its business model from monthly agreements to pay-by-use, giving the company a competitive advantage. By using the cloud, M.G. Bryan maintains no infrastructure, and it can scale the solution from one truck to 4,000 trucks.
Managing Midstream Transfers
Solutions that advance The Connected Enterprise have helped streamline and better secure midstream operations too, including an essential corner of the oil business – hydrocarbon transfers.
Hydrocarbon operations are spread far and wide, often in remote areas. Either on wellheads, storage tanks, pipeline inlets or terminals, buyers and sellers gain unattended access to oil supplies through a LACT unit. Until recently, accounting for these buyer/seller transfers has been a far less sophisticated process. Most LACT units have little automation and even less network connectivity.
Texas-based Trigg Technologies worked with Rockwell Automation to bring its LACT units into the digital age, by developing a turnkey, asset-performance-management (APM) solution, leveraging the Microsoft Azure cloud platform. Software applications combine real-time and historical data into dashboards that provide contextualized information on transfers, overall oil quality and well productivity over time. These measured variables and diagnostics can be seen from any location via a secure internet connection.
With information automatically pulled from the LACT control system to populate e-tickets, billing errors are virtually eliminated. Trending capabilities also allow site and operations managers to better understand the type of oil coming out of each well. This allows them to plan for long-term production across a number of wells or they can mix oil from a variety of wells to produce a more consistent product.
Data Drives Oil and Gas Companies Into Future
The potential for data and analytics in oil and gas is growing every day as more companies tap into it. For example, companies are beginning to explore the use of real-time production allocation.
Rockwell Automation is working with a producer to capture real-time, multiphase flow volumes from all of its existing wells. This will enable operators to monitor data and allocate production to individual wells, specifically pinpointing assets that are underproducing and improving overall productivity.
That’s just the beginning – the possibilities are unlimited. More advanced oil and gas companies are looking to integrate this field data with production planning and accounting systems to enable timely and accurate oilfield production reconciliation.
As more companies seek to capitalize on their data and make the journey to The Connected Enterprise, the decisions they make along the way will be critical to realizing long-term business benefits. Accessing and monitoring assets from upstream, midstream and downstream operations, and merging disparate oilfield data into streams of actionable information are essential to remaining competitive. The space continues to grow with new technologies and smart devices. Working with a third-party automation and information provider, such as Rockwell Automation, can help oil and gas producers on their journey.
1Upstream Oil and Gas Companies Spend Smarter on Digital Technologies to Drive Value, Reduce Costs in Downturn, Accenture and Microsoft Survey Finds, Accenture, March 9, 2016
2The 2016 Upstream Oil and Gas Digital Trends Survey, Accenture, 2016