Drilling advances

With its promise of delivering more with much less, one would think the widely touted, but fairly ambiguous, digital oilfield would be the go-to strategy in a sub-$40/bbl environment. Yet, it would appear that the wholesale adoption of this perceived New Age alternative to well construction and production may have to wait for better times.

In what it described as a classic Catch 22 situation, Norway’s DNV GL cites, for instance, the capacity of data-driven detection of anomalies while drilling, to spawn more efficient and cost-saving decisions. At the same time, the results of a DNV study released on March 16 have only 36% of the more than 900 senior oil and gas professionals surveyed intending to make “significant or moderate investment” in big data and analytics in 2016, even though 45% of them recognized the potential economic and efficiency gains. Ironically, 43% of those surveyed intended to invest this year in closely-entwined automation and remote operations.

The DNV research came on the heels of the Canada-specific 2016 Digital Oil Outlook Report, prepared by the JuneWarren-Nickle’s (JWN) Energy Group, in conjunction with GE and Accenture. In that analysis, a majority of Canadian industry professionals canvassed, likewise recognized the economic advantages of embracing digital oilfield technologies. But they pointed to budget constraints as the primary impediment, followed by organizational barriers and cybersecurity concerns, respectively.

“Early adopters are emerging, but many in the industry are still at early stages of maturity in data analytics and data-based decision-making,” says DNV GL’s Oil & Gas senior engineer, Nada Ahmed. “The industry is in something of a ‘Catch 22’ situation,” said Ahmed. “Close to half of seniors in our industry see solid or high potential for big data and analytics to transform the industry’s operating efficiency in 2016. However, investment seems to be lagging, just when we need it most. Our in-depth interviews point to cost constraints and uncertainty about the cost-saving potential of digital technologies as the key reasons.”

Data quality issue. The digital oilfield concept is catch-all terminology that defines a range of software, tools and processes that cover the entirety of the petroleum stream, from drilling to production and everything in-between. Far from being a contemporary contrivance of data-obsessed millennials, the roots of the digital oilfield for well construction can be found in the evolution of logging-while-drilling (LWD), measurement-while-drilling (MWD), geosteering and other sensor-driven innovations.

“It’s amazing, the number of sensors we now have downhole, and all the data we can capture—so much so, that the issue now becomes how to analyze it in a meaningful and timely way,” Steven Berg, V.P. of operations for the Canadian Association of Oilwell Drilling Contractors (CAODC), wrote in an aside to the JWN study. “Fantastic cloud solutions are available, but our members are met with resistance from their customers, who worry about who else may get the data.”

Compounding the restrictive economic and security issues is the matter of growing apprehension that critical decisions could be based on sensor-generated data that may be less-than-reliable. “How do you know that piece of data you’re ready to make a decision on is right?” Apache Corp.’s Michael Behounek asked during the March IADC Drilling Engineering Committee’s (DEC) quarterly Technology Forum in Houston. “Right now, it may be good enough, but the problem with good enough means you can’t get better.”

Behounek, who wears the dual hat of senior drilling manager and drilling engineering manager for Apache’s Permian basin operations, addressed the DEC on behalf of a newly formed operators’ group looking specifically into data quality. “We will look at all aspects of data quality, but obviously, our initial focus is on well construction, from the operator’s point of view,” he said. “We felt we needed to huddle up and see what was important to us.”

Owing to the well-documented errors and variances that all-too-often accompany rig site data streams, lack of quality assurance can leave potential efficiencies behind the pipe, so to speak. “It impairs our ability to understand the drilling process. The conclusions drawn may or may not be true; they’re not conclusive. It affects our knowledge and best practices, if you just assume, based off that data, that this is the best way to drill this well, or trip pipe or measure for a BOP test.”

Data quality is equally imperative, if the digital oilfield concept is ever to evolve into a truly automated process. “If you really want to step into the world of automation, guess what, you don’t have a human in the (decision) loop anymore. That algorithm cannot discern whether a torque spike is real, though a good driller would probably know whether it was real or not. There is no way we can move into automation until we tackle this.”

Moreover, such groups ostensibly can help fill, what DNV identified, as a vital cog in the drive toward a wholly digitized oilfield. “As for other areas of innovation, collaboration could prove essential to bridging this digital gap and ensuring experience transfer in the conservation of data, efficiency drivers and ways to ultimately leverage the opportunities big data represent for the industry,”
Ahmed says.

And, the opportunities are profound, says Trey Mebane, V.P. of innovation for National Oilwell Varco. “We’ve always had good communication downhole, but now you have that digital easement expanding dramatically across the value spectrum. We have broadband connectivity coming to the bit, and as we continue to add more and more downhole sensors, I guarantee you that we’re going to have the rock telling the rig what to do next,” he told the DEC forum. 

About the Authors

Jim Redden

Contributing Editor

Jim Redden is a Houston-based consultant and a journalism graduate of Marshall University, has more than 40 years of experience as a writer, editor and corporate communicator, primarily on the upstream oil and gas industry.