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The High Tech Oil and Gas Industry - The Intelligent Oil Field

Transforming the Oil Patch with Digital Oil Field and Intelligent Oil Field Concepts

As noted in several articles in which Mr. Severns is referenced and quoted (Wall Street Journal, Financial Times, Offshore Engineer, Associated Press), the exploration and production industry is looking to change the way it produces oil and gas. Operators are increasing their investments in a concept we call the Intelligent Oil Field (IOF), and others describe as the Digital Oil Field, i-field, integrated operations, and Smart fields. But whatever the nomenclature, the basics of the concept are similar in that firms are seeking to take advantage of a variety of digital technologies that are reaching a critical mass of capability and interactivity. Their goal is to realize total asset awareness starting from deep in the reservoir, going across the sandface, up the well, through the processing facilities and out to the export line.

What is interesting is that with the shale revolution, the locus of the intelligent oil field, at least in North America, has shifted away from optmizing production and recovery from large, often inaccessible fields, (think deepwater), to more of a focus on real time drilling management in resource plays, especially in areas with complex geologically complex settings.  Such applications often take advantage of measurement while drilling technology, as well as reasonably priced, real time, downhole directional steering technologies, to optimize well bore placement to maximize initial rates, which are important in the economics of a resource play.

When I first brought the concept of the Intelligent Oil Field (then called the Digital Oil Field of the Future), into Cambridge Energy Research Associates (CERA), in the 2001-2002 time frame, I noted that I expected seismic to grow in importance as a tool for production monitoring in the oil and gas E&P industry.  The reasoning was quite simple, it is the only tool that the industry has that can "see" through miles of solid rock to give us some hint as to what is happening in and around the reservoir.  As noted below in the discussion of time lapse seismic (also sometimes called 4D seismic), this has indeed been happening with large fields that can afford the cost of doing repeated seismic shoots over time.  However, another production related use has become quite prominent over the past few years, and is used extensively to help optimize operations and production in the hottest areas of the oil patch.  I am, of course, talking about microseismic real time monitoring technology, which is used to monitor the efficiacy of fracing in shale gas and shale oil plays.

Articles include:

Real Time Microseismic:  Frackings Newest Revolution


Reservoir and Hydraulic Fracking Monitoring from Surface and Borehole Sensors

My favorite example of how powerful this technology can be in practice is what Continental Oil Resources has been doing with their Bakken technology demonstration project.  Digital Oil Field Example:  Application of Real Time Microseismic:  Hawkinson Technology Demonstration Project - Bakken Oil Field

As proof of the growing importance of the Intelligent Oil Field concept, we note that as recently as the mid-noughts there were still many questions about the importance of using real time digital information and control technologies to optimize operations. Now, the concept has become, if not routine, as least broadyl accepted as an important tool for optimizing operations, and maximizing profit. There is also a chance that over the medium to long term that the technology and expertise that goes with it may reapportion the share of the barrel that goes to producers, service firms and the owners of reserves.

Prominent and leading technologies typically associated with the large field, IOF concepts include:

  • Time lapse seismic
  • Real time, integrated system wide simulation and modeling
  • Enhanced SCADA (supervisory control and data acquisition) and DCS (distributed control systems)
  • Intelligent completions - downhole control valves and advanced sensors
  • Remote operations and visualization facilities

However, a different form of the intelligent oil field has emerged over the past 5 years, and that is the "just-in-time, manufacturing model.  This approach is particularly applicable to resource plays, with their emphasis on drilling, completion and surface equipment production optimization, and less so on long term reservoir management.  In the manufacturing model, repeatability, efficiency, and just-in-time process management are the dominant goals versus minimizing field production costs and maximizing life cycle reservoir management across the primary, secondary and tertiary stages of a more conventional field.

Resource play example- Horizontal Drilling with measurement while drilling (MWD) and rotary steerable system (RSS)

It needs to be emphasized that the intelligent field goes far beyond the simple application of new technology and will likely require sweeping changes in work processes; new organizational forms; and rapid and significant evolution in the relationships between operators and service firms. This people and process element is often overlooked, but is essential for the concept to achieve its full potential.  This is best illustrated in large, conventioal fields with complex field operations, and large, multifunctional support organizations.

Interesting large field, production optimization examples:

Mature Field Applications

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