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IO - getting it implemented

Thursday, February 21, 2013

A discussion at the Trondheim Integrated Operations conference covered different configurations of IO,how much to standardise processes, how best to integrate suppliers, the difference between standardisation and governance

Technology needs to work well in the environment it is aimed at, said Leo de Best, leader of Shell's smart fields team.

'We are in a dangerous business, oil and gas production is something which we do not want to tamper around with too much.'

'The mindset [of the people] is very conservative. They know how things work well.'

'If I buy a car I know the basic principles that it has to do. With some of our technologies, it works, but it doesn't work in the environment we want to roil it out to. A technology needs to work in the Shell architecture, not just IT architecture.'

On the flip side, sometimes people try too hard to make a solution perfect before implementing it.
'Are we trying to aim for the 100 per cent solution, something which is awfully difficult for someone to adapt to, or going 0 to 10 to 60 per cent, which is already a massive change in performance improvement?' Shell's Mr de Best asked.

'Sometimes we are going too often for the 100 per cent solution and can't get it embedded in the organisation.'

The right configuration

The key to a successful integrated operations implementation is 'to understand the configurations of technology, process, people and governance, really to address it,' said Vidar Hepsø, Principal researcher and Project Manager at Statoil ASA.

'All IO work is really about creating sustainable configurations. That is one of the major lessons.'

'There are people who don't understand why you should distinguish between process and governance. But you can have the same work process and change your governance

You have to work out how much standardisation you want. You want some kind of standards for the company which are managed centrally, but if the standards are too tight, you won't have room to deal with regional variations, he said.

'You have a trade-off between making things standardised and local autonomy.'

There is a difference between the maturity of the technology, and the maturity of the organisation which is about to take in the technology, he said.

'In the past we have very good examples of where we thought we had a mature technology but we didn't have a mature organisation that was able to take in the new technology.'

Standardisation and flexibility

BP sees standardisation as a way to achieve more flexibility, Mr Roberts said. Similar to the way that you can build many different things with Lego blocks, because they have a standard way of connecting with each other.

'As a large company with over 100 assets worldwide, in a model where we have to deploy things all the time locally, there's a lot of complexity to deal with,' he said.

'If we standardise, we can plug and play more.'

'We have an entire PC infrastructure on one platform,' said Shell's Mr de Best.

'Anywhere I go around the world I can find a printer in the office in 5 minutes. From a security point of view it is all globally managed.'

'But if you go to the technical part of operation units, there are all kinds of restrictions there.' For example, some countries have restrictions on whether data can leave the country.

Change easier in other industries

BP's Steve Roberts noted that change can be easier in other industries than it is in oil and gas, because they don't have to deal with lots of older equipment all the time.

'In other industries they are always building new products, a new car, a new aircraft, they can install from scratch,' he said. 'In oil and gas we have a lot of legacy platforms and infrastructure to retrofit.'

Rigid standard processes?

'About 10 years ago, Shell embarked on a program to standardise global processes,' Shell's Mr de Best said. 'The basic oil field workflows, processes, which were standardised and had to be rolled out.'

'But by bullheading workflows into a proud operated community, you get an enormous amount of resistance.'

So is it really helpful to try to force a standardised workflow, when the way people work is all fairly similar around the world anyway?

'At the end of the day, a BP well is the same as a Shell well if you want to operate it. A well in Brunei is the same as a well in the Netherlands. If you take the team and guide them through it you end up with same result,' Mr de Best said.

Making data available

'People in the next generation at BP want data to be [readily available] in their environment,' Mr Roberts said.

'They don't want to carry it around, they want to walk into a collaborative environment, the data will [already] be there, and they'll work together with their colleagues to do some good things.'

'I have a regular lunch with the 'next generation at BP to explore their vision of the future,' Mr Roberts said.

'With cloud computing, cloud storage, we'll see a trend where data is available in your environment, and we'll be able to work much more collaboratively.'

'I think the way the world is heading, it will just be naturally available.'


It isn't necessary true that people have to meet each other face to face to have a trust - sometimes the trust can be developed from knowing that there is someone available you can depend on, said Shell's Mr de Best.

'We have in Shell a 'following the sun' support principle, which is nothing more than
24-7 support around the world, in Houston (USA), Bangalore (India), Rijswijk (Netherlands), for deep-water drilling,' Mr de Bestsaid.

'Those centres are critical in making sure we have continuous support.'

'People trust each other, [although] they haven't seen enough other face to face. There is a mechanism there which has driven those centres towards success.'


There were several comments that integration between suppliers and oil companies was not moving so fast as integration within the company itself.

Sometimes oil companies just specify what they want suppliers to do, and think that is all they need to do.

'I don't think change management by specifications or requirements is sufficient,' said Jon Lippe, Operational manager of the Center for Integrated Operations at NTNU.

'How do we make more leaps in the relationship between suppliers and the oil companies?'
BP's Mr Roberts said that there are 'more integrated' digital oilfield offerings coming onto the market, which make it possible to deal with a reduced number of suppliers.

'We're seeing offers where a company can run its own proprietary software onto a commercial platform,' he said. 'I think those offers will really help move forward.'

Ole Klingsheim asked why the oil and gas industry can't manage implementation of new technology the same way that Apple does it, that is to say, make the technology very compelling and then you don't need to 'manage' change at all.

'When Steve Jobs turned up on the podium, nobody knew they needed an iPad until just after he presented it. Then we all knew, I need one of those. By desire, functionality that change happened.'

'Are we not making clever enough solutions? You vendors, why don't you give us solutions that will propel itself into this?' he asked. 'I think they are good at making stuff people want.'

Sometimes suppliers are constrained by not being able to access data. 'There was a compay in Norway that thought there was a market for new services in condition monitoring, they invested, but they were not able to pull it off, because they were not able to get the data they needed,' said Kaare J Finbak of Kongsberg Oil and Gas.

Unified communication

'The biggest change that actually has happened in Statoil in the last 2-3 years is the introduction and usage of unified communication,' said Statoil's Vidar Hepsø.

'That has changed the way we do business in many ways. You can have desktop video, you can have chat, you can have much more type of collaboration. You don't have to go to a meeting room, you can phone up any conference room in Statoil.'

'Just having this awareness that if people are available or not, you can see that on the screen. Even people in their 60s start using chat.'

'That actually happened within 1 or 2 years, it happened very fast.'

'It had consequences for how we use the open spaces. Moving control onshoreIs it desirable or achievable to move decision making and control onshore?

'We have a lot of uncertainty in our industry, there's a lot of risk, so need to be careful moving work from offshore to onshore environment,' Mr Roberts said. 'It takes time.'

'The regulatory authorities have to besatisfied, they are looking for a track record. In certain parts of the world you have resistance from unions; they see it as eroding jobs.'

'You have to show you can do the work onshore to the same quality if not higher quality, and get a track record so you get the permissions.'

Mr Roberts also noted that the complexity of offshore operations is increasing all the time, with more stringent environmental requirements and more production streams with impurities which need to be removed, such as hydrogen sulphide. So at the same time work is being taken onshore, the workload offshore is increasing.

'There are numerous amounts of examples of platforms offshore which are operated without anybody on board,' Shell's Mr de Best said.

'As an example, our gas platforms inQatar are normally unmanned. Gas production platforms in Holland are 2 weeks unmanned. So the developments are moving towards normally unmanned operations.'

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