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How to get past "no" - Jonathan Guthrie

Friday, February 26, 2016

Senior management in oil and gas companies often avoid interesting analytics projects because they are more comfortable doing things the way they always did them, said energy consultant Jonathan Guthrie.

There is a lot of talk in Aberdeen about trying to be more efficient, but 'to be honest, I'm not seeing a lot of new efficiencies being introduced,' said energy consultant Jonathan Guthrie.

He was speaking at the Digital Energy Journal forum in Aberdeen on September 29 2015, 'Using Analytics to Improve Production'

'I've been working in oil and gas since 1981, this is the sixth downturn I've seen, and behaviours have not changed. It is so disappointing. Every other industry gets better, but this one carries on, they batten down the hatches and carry on with the same old story and excuses.'

In this climate senior management often just want to keep the company on a conservative course, saying no, killing ideas, and demanding onerous reporting through bureaucratic systems, he said. 'There isn't anyone in charge of new growth ideas.'

The mantra seems to be, 'let's give the appearance we want to improve, but let's just continue the same old workflow, the same old inefficient processes we've always been doing, it feels safe.'

Mr Guthrie has looked at data from many E&P companies in Aberdeen, and found that 'one company is no better than another in how they collect, manage and analyse data.'

As an example, Mr Guthrie recently worked out how he could help an operator deliver £15m of value to the business, which he could implement with a few weeks of consulting work. But the operator's procurement staff insisted that company rules were that all consultants should cut their rates by 10 per cent.

'I said, 'no, why should I,'' Mr Guthrie said. 'I had already offered them my lowest rate. Why should I as a small independent take a cut for a short-term service engagement just because everybody else is? They were only thinking of cost and were blind to value.'

So as a piece of advice to the industry, 'if you want to get analytics going, you have to avoid these people, you have to find the person with the vision and enthusiasm to change behaviours and do something different,' he said.

Meanwhile most data is just treated like TV, the data comes in and people look at it, it gets stored, but never analysed. It would be better if the data was analysed and the results used to work out ways to improve.

The talk about 'big data' is more hype, Mr Guthrie said. E&P companies have always spent large amounts of money gathering data, the point is that they do nothing with it.

Instead of just talking about optimising 'investment dollars per BOE of production,' companies should be asking broader questions, such as, 'where is the best place to drill a new well,' or 'are you using the best completion technology,' he said.

'A lot of work we do is showing people what they don't know they don't know, or tell them about things that aren't happening, which they thought were happening,' he said.

Operators still waste large amounts time and effort requiring highly skilled engineers to spend their time 'QCing' data, or extracting and crunching data in spreadsheets. 'How sad is that?' he asked.

Another common problem is that people only focus on 'their own' data from a small segment of operations. You arrive at a situation where 'their' data says everything is fine, but the plant/equipment is still failing.

Start small with analytics

On the software side, you can start small, taking data from different systems, mash it together in an analytic tool, quickly visualise what is going on, get a better understanding of the flows and look for actionable insights.

'Data is locked in our applications, experience and knowledge are locked in the mind of our employees, analytics is the key to unlocking the value here' he said.

Emotions

Data attracts a lot of odd emotions.

'Many people despair that there's too much data, and it is of poor quality and it needs to be fixed before it can be used. The first step is to just look at a small piece of it. You can't eat the whole elephant at once.'

There is a lot of apathy around data. People say, 'I've collected all this data and nobody ever looks at it, why should I bother,' he said.

There is also fear, with people worried about stating ownership of their data, in case they get blamed if someone else finds an error in it.

Another emotion is control, where the data owner declares a right to tell others how the data should be used and who is allowed to access it. 'These are the barriers that need to be broken down,' he said.

IT department

The IT department can prove a barrier to analytics. 'They have security, they have policies, they will decide how data will be stored,' he said.

They want to provide software in the traditional way, 'Give me a spec, tell me what you need and I'll deliver it to you,' he said.

But the business user doesn't usually know what they need, to be proactive they need unrestricted access to the data and self-service tools to explore data of all types, to discover insights and deliver actions.

History and now

The real challenge for oil and gas experts is to use historical data together with the streaming data about what is happening right now.

There are analytics tools which work through historical data and real time data together to make predictions, he said.

For example the analytics can say, if event 'A', 'B' and 'C' happen, then there's a failure on its way.

The computer can automatically analyse the incoming data stream, and see A and B have happened and C is close to happening and raise the alarm.

The computer system can also automatically help you check you have the right spares available, how much unplanned downtime you have, what are the real-time trends and how this is impacting profitability.

Tools

For analysis, Mr Guthrie has used Tableau, Qlik and TIBCO Spotfire (his analytic tool of choice, he was previously employed by Spotfire).

Tools like this can work simultaneously on data from multiple sources, without having to bring the data into a central warehouse, he said.

If you want to do modelling on the data, then it is easier if the data is in one place, but 'you don't have to start there,' he said.

When optimising, you want to get as big a picture as you can of the process.

'The great thing about analytics is, it helps people very quickly visualise what is happening over time,' he said. 'You can drill and complete better wells, optimise processes and routes. We're constantly searching for what we don't know we don't know.'

As an example, there is discussion going on about taking old seismic shoot data and re-processing it using new techniques.

Looking at Spotfire in particular, most oil companies have corporate licenses, which means that any company employee can use it. 'For an engineer typically you just have to get a copy on your desktop to connect to the data and start analysing.'

Oilfield services companies could use analytics for root cause analysis, drilling and completion optimisation, analysis of revenue and profitability across different products and regions, HSE incident tracking, maintenance schedule optimisation and project management, he said.

Wood McKenzie currently delivers a tool to its customers using Spotfire to do decline curve analysis on the production data history from more than 1 million wells in North America, he said.

Out of the box Spotfire is a great tool both for quickly building simple dashboards, and for doing complex data science, he said.

Middle East

Mr Guthrie was engaged over summer 2015 working for a Middle East oil company, where he used Spotfire to help implement new analytic workflows, to monitor and analyse how allocated production from 2,500 wells was declining, the effects on the gathering centres and wells at risk.

Spotfire was also used to optimise rig and workover activities.

'By delivering visibility of rig resources and workover activities with Spotfire the team were able to accelerate the delivery of 120,000 bopd of gain across all assets in 6 weeks just by prioritising and optimising the activities and resources,' he said.

The business environment for these companies is quickly changing, as fields start to decline and water management becomes a larger factor, they need to analyse more and more data to be pro-active in the decisions they are making for the future life of the reservoirs, fields and the assets to deliver the production.

Case study

As one example, the company is combining data from spreadsheets, files, Halliburton's 'OpenWorks' and Schlumberger's 'Finder' data management tool to build new workflows to support the decision making processes.

Spotfire acts as an 'integration layer', which is 'nothing clever', just bringing data into the analysis from a number of underlying data sources/views, he said.

In 'Eagle Ford' multiple data sources provide the feed into a Teradata data warehouse, which does the data governance work, and then the advanced analytics is delivered using Spotfire.

The company does a wide range of analytics including predicting failures, optimisation, looking at well settings, recommending actions, electrical submersible pump monitoring.

Another customer is looking at Spotfire data to monitor and analyse Electrical Submersible Pump (ESP) failures and compare suppliers, he said.

'This is where I see the biggest value add, analytics is going to help identify the right technologies, the right tools for the job, and show what works what doesn't,' he said.

So analytics should help you get to first oil faster, improve your production capability and be more efficient, he said.



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