May 2023

Drilling advances

Data: “The great equalizer”
Jim Redden / Contributing Editor

Back in the day, the introductions of 2D, and later 3D, seismic and completely steerable bottomhole assemblies were heralded as seismic shifts in the oil field's progression from its roots of dumb iron and luck to more of a scientifically oriented enterprise.     

The string of innovations that has debuted since would likely short-circuit the mental dashboards of some of those early digital trendsetters. In April alone, we saw an operator engineer digital twins of two offshore platforms so that operations can be conducted in the comfort of an onshore office, and a contractor and cloud-based energy platform join forces to simplify the full automation of AC-powered land drilling rigs.  

The foundation of all this can be traced to rapid acceleration in the collection of pertinent, accurate and actionable data. "I've seen so much value created with data through the years," says Jim Claunch, expert partner–digital transformation for consultancy Bain & Company. "As an industry, we're learning more and more about the power of data."  

Claunch made the comments while moderating a Reuters webinar in March that explored the leveraging of data to scale digital transformation and improve bottom lines. Representatives of super-majors ExxonMobil and Shell, along with independent Northeast Natural Energy LLC, outlined how clean data provide a competitive edge, regardless of market capitalization.  

Digital, data inseparable. Patrick Dunn, manager of upstream digital and data for ExxonMobil, said any discussion of the digital transformation begins and ends with data.  "When we talk about digital transformation at scale, what we really mean is data transformation. You really can't talk about one without the other, and I might make the case that data transformation is really the only way you can get digital transformation at scale. Otherwise, you're left with these random acts of digital, where you have specific sites and specific tools, but it's difficult to get scale," he said. 

Dunn said a key learning in ExxonMobil's progression of data strategies is the importance of data that are easy to access, trust and use. "Especially in a company and an industry as complex as ours, a modern-day platform is crucial for scaling digital technologies and capabilities, whether you're talking about digital twin technologies for maintenance and operations or data science in advanced analytics, trustworthy and conceptualized data is crucial for scale." 

Dunn said a contemporary foundation with those data qualities will be more relevant to future business models, as the energy transition progresses.  "As our teams have begun working on our new low-carbon solutions business, many of the same principals related to digital and data at scale directly apply to a lower-carbon, lower-emissions future," he said. "I think the same skills, digital capabilities and data principals will continue to be relevant for many years in the future." 

Cultural shift. Having sufficient technical wherewithal to develop an effective digital strategy is less an obstacle than that posed by a data silo-oriented mindset, says Shell V.P. of subsurface data and digital, Paul Zeppenfeldt. "The challenge we're facing is more often a cultural and psychological one than a technical one," he said. "We need to move our industry out of our vertical functional colony that gave us our pride, our identity and maybe our arrogance, here and there, to a horizontal world where data moves throughout an organization to add value."       

While many may see digitalization as solely the realm of coders and programmers, Zeppenfeldt emphasized that companies must consider all disciplines within the organization.  

He pointed specifically to Shell's wells group, which along with success in standardizing processes and data, has incorporated artificial intelligence (AI) to assist in well placement that "has shown benefits for our assets and adds credibility to the whole exercise."    

"You cannot physically see your (subsurface) assets, so you need to maximize the data you can get. If you move your data, especially in the cloud, it helps a lot with the demystification of the subsurface," he said.  "The efficiency gains you can get by getting this right are massive, because we're dealing with multi-billion-dollar decisions." 

Zeppenfeldt agreed with Dunn that the importance of clean and useable data will only magnify in the coming years, especially when it comes to smoothing over an increasingly wary society.    

"The importance of data is only going to grow, as our industry, on average, will be dealing with more and more mature assets, which by definition means more data we need to understand and correlate," he said. "And, as we move into the energy transition, a lot of our projects like carbon capture come with a higher level of societal scrutiny. If we have a project where we store CO2 in the ground, we have to prove to society and to regulators that the CO2 is staying where it should be, so that means we have to digitalize from the start."   

Leveling the field. What Zeppenfeldt described as "the big equalizer," data go a long way to narrowing the competitive gap between giant operators and their appreciably smaller peers, says B.J. Carney, V.P. of geoscience and innovation for Northeast Natural Energy, which operates exclusively in the U.S. Appalachia basin. "All explorationists rely on data and all sorts of disparate data," he said. "Without good, quality data, we cannot do our jobs effectively. The first thing I would say is that your data has to be trustworthy, it has to be clean and it has to be in a format that is easily digested and useable."   

Vital for major operators, but perhaps more so for smaller players, showing value early  is critical to maintaining corporate patience, given the sizeable talent and financial investment required. "It’s critical for us to show a value stream from whatever data strategy we develop."  

While data accuracy is the primary criterion and "creates the most sweat" for those working with data, Carney said developing a digital strategy must begin by identifying precisely what you want from the data you are collecting. 

"It's not only collecting data for data's sake, which is fine, but it takes time and costs money. What's really critical is to first develop a set of goals that focus on what you want the data to do for your company and then develop the strategy," he said. "What are you looking for from your data? Are you competing with other companies to secure access to new exploration areas, or are you trying to improve certain processes in your production or drilling operations, or are you trying to reduce costs or reduce emissions?" 


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.
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