#18 digital energy journal - april 2009
TRANSCRIPT
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April / May 2009 Issue 18
Production:
Implementing digitalenergy - lessons fromUS Air Force
The company thatmonitors 20,000 wells
Oil and gas industry liketeenagers with datamanagement
Subsurface:
Using dynamic dampeners to drill 50 per cent faster
Secrets of networked drill pipe Associate Member
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Contents
Improvements with broadband networked drill stringNetworked drill pipe transmits data from downhole MWD/LWD tools at 57,000 - bps far more
than the 6 bits per second commonly available using mud pulse. We asked National Oilwell
Varco how it works.
Communicating from downhole with a chirpCalgary company XACT Downhole Telemetry Inc. has developed a way of transmit 20 bits per
second (bps) uncompressed data from downhole to surface that is independent of the drilling
fluid and formation properties.
Geotrace introduces ray-traced anisotropic PSTMSeismic data processing and data management company Geotrace has announced its new
KirchMig tool for anisotropic ray traced prestack time imaging
Drilling technology - evolution or revolutionThe second plenary session of the IADC conference had the theme technology evolution or
revolution, talking about how the drilling industry develops new technology, and whether it
is innovative enough to develop new technologies and methods needed to help produce the
oil which the world needs
50 per cent faster drilling with APS active damperAPS Technology has developed a system to keep your drillbits in constant contact with the
formation by reducing bit bounce and stick slip which could help you drill 50 per cent faster,
and make your drill bits last 25-30 per cent longer
SPT Group launches new version of DrillbenchNorwegian software and simulation company SPT Group has launched a new version of
Drillbench, its software for simulating and modeling drilling operations
7
April / May 2009 Issue 18
April - May 2009 - digital energyjournal
Digital Energy Journal is a magazine for oil and
gas company IT professionals, geoscientists, en-
gineers, procurement managers, commercialmanagers and regulators, to help you keep up
to date with developments with digital technol-
ogy in the oil and gas industry.
Each issue of Digital Energy Journal print maga-
zine is mailed to 2,000 oil and gas executives,
with a further 500-1000 copies distributed at
trade shows, as well as being downloaded ap-
prox 2,000 times as pdf.
Subscriptions:Apply for your free print or elec-
tronic subscription to Digital Energy Journal on
our website www.d-e-j.com
Printed by Printo, spol. s r.o., 708 00 Ostrava-Poruba,
Czech Republic. www.printo.cz
Digital Energy Journal213 Marsh Wall, London, E14 9FJ, UK
www.digitalenergyjournal.com
Tel +44 (0)207 510 4935
Fax +44 (0)207 510 2344
EditorKarl Jeffery
Technical editorKeith [email protected]
SubscriptionsKarl Jeffery
Advertising and sponsorshipAlec EganTel +44 (0)203 051 [email protected]
Lessons from the US Air ForceThe oil and gas industry could learn a few lessons from the US Air Force in working out the
best way to implement and integrate new technology, says Houston oil and gas consultantDutch Holland of Holland & Davis
The company that monitors 20,000 gas wellsOklahoma company Universal Well Site Solutions has implemented its remote monitoring and
control system at 20,000 coal bed methane wells including technology to switch your pump
and on off remotely
Sword developments with electronic documentationEuropean business software and applications company Sword Group is aiming to take oil and
gas engineering document management to a new level where documentation systems can
really be used to help maintain safety and efficiency
Oil and gas industry teenagers with data managementThe oil and gas industry is like teenagers with data management getting there slowly, but
still needing some prodding, cajoling and forcing to get them to do it properly, delegates to
SMIs E&P Information and Data Management conference in London on Feb 10-11 heard
Using live 3D drawings instead of technical documentationSilicon Valley company Right Hemisphere has a new vision for technical manuals of the future
replacing them with live 3D images of the equipment
22
Oil and gas production
17
3
1
Front cover: IntelliServ's networked drill pipe
can carry data at 57,000 bits per secondfrom measurement tools in the bottomholeassembly and for the first time all along thedrillstring. In the photo - the electronics inthe link subs get checked before beingassembled into the pipe.
6
23
LeaderPlanning this Septembers Offshore Europe conferenceWe interviewed Thomas Thune Andersen, this years chairman of Aberdeens Offshore Europe
exhibition and CEO of Maersk Oil, about plans for this years event on September 8-11
Western Gecos land seismic systemWesternGeco has launches UniQ; a new integrated point-receiver land seismic system.
Pronounced Unique, the system can record up to 150,000 live channels at a two millisecond
sample interval
Norway broadening its data reporting requirementsThe Norwegian Petroleum Directorate (NPD) is considering broadening its reporting
requirements, forcing companies to supply both their pre-stack data as well as all relevant
processed post-stack, and implementing mechanisms to ensure that data from relinquished
areas is collected and efficiently managed
Exploration and drilling
13
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4
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The 5th INTERNATIONAL CONFERENCE ON INTEGRATED OPERATIONS IN
THE PETROLEUM INDUSTRY, TRONDHEIM, NORWAY 2930 SEPTEMBER 2009
Established by the Research Council of Norway
Kyoto University
Partners in the Center for Integrated Operations in the Petroleum Industry:
Cooperating academic partners:
eFieldsSmart Fields
Digital Oil FieldsFields for the Future
International meeting place for business and science
IO 09 Science and practice is the international meeting place that will bring you to the network and give you trends and opportunities
for research and business in integrated operations. You will meet the players from oil companies, suppliers, research laboratories and
price situation in order to improve productivity and save costs.
Where Science and Practice meet
This conference is about the methods and tools for integrated operations, today and in the future. IO09 is the place where science and
practice meet. It will present the experience from some of the most advanced oil companies, system suppliers and research institutions
meeting place for generating new impulses in the further development of integrated operations practice. See: www.ioconf.no
Sessions
IO 09 will highlight aspects of the technologies and work processes for better productivity and safety.
2. Smarter oil and gas world experiences and solutions
3. Pushing the boundary of integrated modeling
4. New work processes and collaboration environments
7. IO solutions for improved safety and environment
Sponsoring organization:
innovation and education on integrated operations. www.ntnu.no/iocenter
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Leader
April - May 2009 - digital energyjournal 3
The North Sea has always been a key melt-
ing pot, says Thomas Thune Andersen,
chairman of Offshore Europe, also CEO of
Maersk Oil and a member of the executive
board for AP Moller-Maersk, the worlds
largest container shipping line.
A lot of industry has been developed
and driven there. Everything around health,
safety and environment (HSE). A lot of that
has been exported.
We have a lot of companies who havedeveloped from there. They have a long term
future. They are doing things in the Middle
East and so on.
So it seems reasonable to expect that
there will be plenty of interest in this years
Offshore Europe conference and exhibition,
which is (alongside Norways ONS, held on
alternate years) the largest event for North
Sea oil and gas.
Fundamentally it is my hope that any-
one who has joined Offshore Europe leaves
it inspired, with more enthusiasm to go backto their job, he says.
I've been to a number of Offshore Eu-
rope sessions. It seems like a place where
things are happening and a vehicle for new
ideas. I thought it was quite exciting to be a
chairman.
The 2007 event attracted 40,000 visi-
tors each day, with 1,455 exhibitors, and ex-
hibition space this year is already sold out.
There is a lot of confidence in the success
despite the economic downturn.
Its our obligation now to make sure
exhibitors get the value out of that, he says.
We hope some people will make a bit of
business.
The main thing that we would hope to
achieve from this conference when it is over,
will be to have addressed young people ei-
ther joining the industry or who have an in-
terest in the industry who can come and
get inspired and learn about what the oppor-
tunities are for them.
Offshore Europe attracts people of all
different aspects, he says. Its a forum
where people can talk. There's few placeswhere people in the industry get together. We
want an environment where its easy to net-
work.
It is important that people aim to make
contributions to the event as well as look for
what they can get out of it. The quality of
what comes out is as good as what comes
in, he says.
The theme this year is energy at a
crossroads, looking in particular at technol-
ogy, climate, industry operational models
and people.
The themes were decided on 12 months
ago. The world has turned upside down in
some ways since we did it, he says. But
the topics are more relevant.
Technology and innovationNew technology will be a key area for Off-
shore Europe. We want to share the latest
technology, trendsetting stuff, he says.
We are getting more input to the tech-
nical papers - it is evidence that the industry
is very much alive, he says. Its important
there are hardcore technical papers.
Mr Andersen defines two different
types of innovation traditional innovation,
such as where a large company developsnew ideas, and open innovation, when new
ideas are developed by diverse groups of
people.
For open innovation to succeed, com-
panies need to be open to the idea of inte-
grating with other companies, and entering
partnerships, he says.
Mr Andersen strongly believes that
there is a continued need for integration and
partnerships in the oil and gas industry, par-
ticularly to get new technologies being de-
veloped and used.
You need a good transparency of
where the technology is, and less focussed
about who brings it to market, so we allow
some of these ideas to come faster to the
forefront, he says. The need for being open
and sharing is more important.
Mr Andersens views about integration
have been influenced, to some degree, by his
Danish background. Denmark is fairly
small - in certain areas we are world class
but we can't be experts in all things, he says.
When we have been doing things in
Denmark - it has been done very much withpartnering, he says. It shows a need for in-
tegration.
ClimateThe event, on Sept 8-11 2009, is just a few
months before the United Nations Copen-
hagen Climate summit on December 6-18
2009, where there are high expectations that
the world might agree on new targets for
greenhouse gas emissions.
Connie Hedegaard, Danish Minister for
Climate and Energy, and host of the Decem-
ber United Nations summit, will address Off-
shore Europe.
The outcome of the Copenhagen sum-
mit could affect the oil and gas industry in
many ways such as by helping encourage
carbon capture and storage, encouraging
lower energy use in oil and gas extraction,
and reducing overall oil and gas demand.
For me, climate change is a pretty
wide subject, he says. If there is to be a
low carbon future how does that impact
us? What does it mean for the oil industry to
make sure we reach the goals?
Then its an issue of - how can we ex-
tract resources with the lowest energy foot-
print? What is the best way of doing thesethings?
We are preparing our role in industry
to make sure we can be socially responsible
companies, and working out what the right
targets are.
"Fundamentally it is my hope that anyonewho has joined Offshore Europe leaves itinspired" - Thomas Thune Andersen,chairman of Offshore Europe, also CEO of
Maersk Oil
We interviewed Thomas Thune Andersen, this years chairman of Aberdeens Offshore Europe exhibition
and CEO of Maersk Oil, about plans for this years event on September 8-11.
Planning this Septembers OffshoreEurope conference
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Leader
digital energyjournal - April - May 2009
to support the extreme channel capacities
and associated data volumes and quality con-
trol requirements, a new architecture has
been developed. Everything is redesigned,from the GAC sensor and the ground elec-
tronics to the recording truck and camp data
processing trailers, says Mr Papworth.
The high channel count point-receiver
technology is combined with a continuous
Western Gecos land seismic systemWesternGeco has launched UniQ, a new integrated point-receiver land seismic system. The system canrecord up to 150,000 live channels at a two millisecond sample interval.
One of the biggest components is car-
bon capture and storage, he says. It is get-
ting a lot of support. There's a huge focus on
it right now - a lot of research and develop-
ment. I think we will see great break-
throughs.
There's different players involved -
power stations [to separate out the carbon
dioxide], engineering companies [to trans-
port it] and oil companies [to inject it in un-
derground reservoirs].
Mr Andersen is particularly interested
in the idea of using carbon dioxide to help
get more oil out of ground (enhanced oil re-
covery). I think its hugely important as a
general concept, he says.
Operating modelDiscussions will be held at Offshore Europe
about gradual changes in the operating mod-
els of the oil and gas industry.There are a number of unique things
happening around state control of resources,
access to resources, and what's happening
with the resources, he says. There's a need
to look at trends and the operating model.
If we were 3-5 years in the future and
look back, we'll see this as a time there were
some structural changes. It would be excit-
ing to have a discussion around that.
Well have a panel of people from the
different groups national oil companies, in-
ternational oil companies.
PeopleThe people issue is most important, he says.
How do we attract and motivate people and
in a way which is sustainable?
The most important thing is we show
the outside world that this is an industry with
a lot of future.
However, we can't turn a blind eye to
the fact that there's an economic crisis outthere, he says.
During the economic downturn, it is
important that companies ensure that their
core competencies are protected.
No-one feels they can do this without
a sophisticated and professional approach,
he says. Were getting into deeper water
and more harsh climate environment. There
will be quite a lot of companies who will see
their competitive advantage in being at the
forefront of technology.
In particular, the industry should be en-
couraging more children to study science
and engineering. Overall we're short of peo-
ple with a science and engineering back-
ground, he says. I think that's a whole
mindset around education.
The Offshore Europe event will work
together with the Oil and Gas Academy OPI-
TO (see www.opito.com), which will bring
in large numbers of school children to the
event on the final day. Also a large numberof students are expected to attend.
Geophysical services company WesternGe-co has launched a new land acquisition and
processing seismic system called UniQ. The
system combines high channel count point-
receiver technology with support for ad-
vanced simultaneous source techniques.
Field tested in the Arctic and the desert,
UniQ can address land seismic challenges in
a multitude of environments from the hottest
deserts to freezing conditions.
The system is designed to extend the
capacity, flexibility, reliability, efficiency
and quality of land seismic data acquisition,
particularly in areas of complex geology and
high-noise environments, says UniQ land
marketing manager, Stuart Papworth. UniQ
can be used for fast-moving, fit for purpose
exploration surveys and also wide-azimuth,
broad-bandwidth appraisal and development
surveys, he adds.
A high channel countUniQ builds upon the existing high fidelity
provided by the broad bandwidth Geophone
Accelerometer (GAC) sensor and the West-
ernGeco Q-Land point-receiver acquisitionand processing system. Q-Land, launched in
2002, is acknowledged for its capabilities of
acquiring up to 30,000 live channels. UniQ
however, takes Q-Land successes further,
boasting support for up to 150,000 live chan-
nels at a 2 millisecond sample interval.According to Mr Papworth, The abili-
ty to acquire and process high-channel-count
point-receiver surveys has brought about a
step change in the quality of onshore seis-
mic imaging.
Mr Papworth explains why a high
channel count is important, In current land
projects, source points are often repeated
twice or more in order to acquire well-sam-
pled full-azimuth (FAZ) data. This is ineffi-
cient and expensive: twice the shot points
means it takes twice as long to complete the
survey with double the costs. So, how do you
reduce the number of shots?
The great thing about seismic is that
geophysically, sources and receivers are in-
terchangeable you can compensate for hav-
ing few receivers by having more shots, and
vice versa; you can reduce the number of
shot-points by increasing the number of live
receivers. This is where the extreme channel
counts supported by UniQ come in. UniQ
enables us to field the right number of point-
receivers to do any job optimally, including
efficient full-offset, FAZ land surveys - theholy grail of seismic.
Precision ImagingUniQ, however, is not simply a scaled-up
version of existing land systems. In order
The UniQ GAC is a motion sensor that deliverssignificantly reduced signal distortion andincreased bandwidth
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April - May 2009 - digital energyjournal 5
acquisition system that eliminates dead-time
between acquisition records, and supports si-
multaneous source techniques. Seismic data
are continually streamed from the sensors to
the central system so that there is no delay-
inducing system cycle time between shots.
System timing is GPS based, increas-
ing accuracy, and the GPS time-stamps are
used to separate the data into shot-records
either in the recording truck or in camp. The
field planning software, source and record-
ing control systems and camp data-process-
ing facilities are all designed to work in an
integrated manner to enable efficient equip-
ment layout and optimized data handling
while ultimately reducing the time from shot
to processed deliverable.
Receiver lines are formed by connect-
ing sensor strings back-to-back to create
long segments that are powered at both ends.
Each string does not require a take-out, andthere are no heavy lines cables to deploy and
retrieve.
Cut a sensor string anywhere, and data
and power continue to flow from both sides,
keeping the sensors up and running until the
break can be repaired. A network of light-
weight fiber-optic cables replaces the tradi-
tional single backbone, and automatically
routes data via an alternate path in case of a
cable break.
The UniQ sensors are also plug-and-
play, running their own self-tests before be-ing ready for acquisition seconds after con-
nection. Sensor data are completely self-de-
scribing, sending coordinate, test, and envi-
ronmental data back to the recorder for in-
corporation into the seismic data headers.
This reduces the risk of errors in data
processing and speeds up turn-around-time,
says Mr Papworth. Clean data is essential
to producing high quality imaging results atany stage of oilfield exploration and devel-
opment.
UniQ is also fully compatible with all
the high productivity vibrator techniques that
are becoming standard.
Desert Explorer vibrators probe shifting dunes of indeterminate velocity and thickness to imagethe rock formations beneath
For more information about UniQ, please
visit www.westerngeco.com/UniQ
or email [email protected]
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Norway broadening its data reportingrequirements
The Norwegian Petroleum Directorate (NPD) is considering broadening its reporting requirements,forcing companies to supply both their pre-stack data as well as all relevant processed post-stack, andimplementing mechanisms to ensure that data from relinquished areas is collected and efficientlymanaged, says Eric Otto Toogood, project manager of DISKOS, the data repository operated by theNorwegian Petroleum Directorate in collaboration with the Norwegian oil industry.
NPD is keen to include pre-stack data be-
cause many companies are asking for it. A
lot of smaller companies coming to Norway
would like to go back to field data using
modern reprocessing techniques, he said.
DISKOS is also expanding its efforts to
track down non-reported data where com-panies have data they are supposed to sub-
mit, but they dont.
It is also keen to prevent companies
from supplying data to the NPD in propri-
etary formats, because it does not feel so
confident it will always be able to read the
data when it needs to, decades into the fu-
ture. We have some proprietary formats,
that we are keen to replace with open stan-
dards, but this can often be a technical chal-
lenge he said. We really want to get away
from there.DISKOS wants to be able to make data
from relinquished acreage more widely
available. In other words, if you dont want
to drill in a certain area, there is an obliga-
tion to relinquish the acreage but the chal-
lenge remains in giving other companies ac-
cess to all the available data i.e. maybe to
have access to most, or all of your data.
There might be tough fighting when
we change reporting requirements, he ad-
mitted.
NPD is keen to make it easier for peo-
ple to use and access the data. We want
make the data available to non expert users,
he said and is looking forward to the imple-
mentation of a more sophisticated, user
friendly front-end in the PetroBank software
currently being used by Diskos.
The DISKOS service recently changed
its service provider for managing the opera-
tions. The previous contract was awarded to
Schlumberger for 2004 to 2008, and now to
Landmark for 2009 to 2014.
The DISKOS initiative began original-
ly as the Geobank project in the early 1990sand began normal operations in 1995 run by
the company PetroData as a repository for
post-stack seismic data, with 5 companies
involved; now there are 52 members and da-
ta coverage has expanded to well and month-
data management point of view is a complex
process, particularly when moving it from
one storage media to another one, especially
if older media look like they will become ob-
solete.
You have to reformat data its an ex-
pensive business, he said. The main issueis the ability to read media. We need to keep
data for at least 10 years and hopefully a lot
longer. You need durable systems that can
withstand change.
Putting data into a managed solution
such as Diskos solves all of these problems
as the data sets are continually being re-
freshed onto new media through an agree-
ment with the service provider. The current
approach is to have a mix of technologies
where both tape and disc based solutions
work in concert, giving the best of bothworlds.
The database has about 120 terabytes
in it, with 16 people employed to manage it.
The data is passed through quality control
checks as it is entered into the database. It is
normally in SEG-Y format for seismic data
and a number of standard formats for well
and production data, he said.
In the past the NPD had physical data
stored on paper, sepia, film, microfilm and
tape, which is the typical situation facing
many companies worldwide today. One key
task is often in digitising paper well logs. It
is time consuming but enables us to do more
with the data, he said.
We think weve set up a high quality
database. Weve had a lot of members, I
think theyre getting value for money, he
said.
The DISKOS members typically down-
load around 3.5 terabytes of data per month
out of the database, he said.
ly production data.
Any oil company can join DISKOS;
Norwegian Universities are allowed to ac-
cess non-confidential data for academic and
research purposes. There are opportunities
for companies other than oil companies to
access public data, but without online ac-cess. Giving non-oil companies online ac-
cess to the database is a priority for Diskos
in 2009.
Managing the dataOne of the biggest challenges for DISKOS
is managing the enormous amount of data.
The rate of data collection is increasing
all the time. 2007, 2008, and probably 2009
are record years for acquiring seismic data
in Norway, he said.
The Norwegian government keeps dataabout all the seismic surveys which have
ever been carried out and all of the explo-
ration wells, so that it always has the best in-
formation possible about what has been
found out so far about its oilfields and the
resource potential of the Norwegian conti-
nental shelf in general.
We need user friendly systems and to
be able to find data over the long term and
we want to reduce the cost of moving data
around.
One of the biggest challenges is keep-
ing DISKOS as complete as possible. There
is no easy way of knowing if DISKOS has
got all of the available data in its system,
even though there are very specific regula-
tions to ensure that all seismic, well and pro-
duction data data gathered on the Norwegian
continental shelf are reported to the authori-
ties.
A further challenge is making sure that
all of the data is high quality, and not dupli-
cated, he said.
There is a disaster recovery site over
10km from the main operation database,where a back-up copy of all the data is
stored. If there is any problem with the main
database the back-up copy can be opera-
tional (for read only purposes) in 5 days.
Looking after data from a traditional
This article is based on a speech given by
Mr Toogood at the SMI E&P Information
and Data Management conference in Lon-
don on Feb 10-11 2009
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Exploration and drilling
April - May 2009 - digital energyjournal
Improvements with broadbandnetworked drill stringNetworked drill pipe transmits data from downhole MWD/LWD tools at 57,000 - bps far more than the
6 bits per second commonly available using mud pulse. We asked National Oilwell Varco how it works.
National Oilwell Varco reports that its Intel-
liServ Broadband Network service delivered
high-definition subsurface information in
more than 60 wells since its commercializa-
tion early 2006, drilling over 610,000 feet in
four continents in onshore and offshore envi-
ronments, in vertical, deviated and horizon-
tal wells.
The abilities with a broadband network
and data acquisition all along the drill string
is enormously helpful in making operationaldecisions in real time, and placing the well-
bore in the right place while continuously
monitoring what is happening downhole.
The broadband network carries data at
speeds of 57,000 bits per second far more
than 1 to 20 bits per second typically avail-
able with other technologies for communica-
tions from the drill bit, such as mud pulse,
electromagnetic or acoustics.
Further, the broadband network has a
constant signal strength with increasing well
depth, while the data-rate typically degradesfrom 20 bps at shallow depths to as little as
1bps at extreme depths with mudpulse.
Many people have tried to develop
wired drill pipe over the years, but they could
not find a way of getting around the problem
on how to establish connections between
lengths of drill pipe allowing data flow across
that would not be affected by dirt or mud on
the connections. For example, a typical met-
al to metal connection (such as the cables that
plug into your computer) would not work.
GrantPrideco developed a double shoul-
dered premium connection (subsequently ac-
quired by National Oilwell Varco in Decem-
ber 2007) that helped solve the problem: In-
stead of having a live metal to metal data con-
nection at the pipe joints, an inductive coil
was placed on the secondary shoulder.
The inductive coil generates a magnetic
field from the current supplied on a coaxial
cable, which runs through each length of drill
pipe, connecting with the inductive coil on
the other end of it.
The data therefore is communicated
through the magnetic field at the connectionand not from metal to metal contact, so coils
covered in dirt do not affect data communi-
cation.
Still, it is important to keep the coils as
close together as possible: The further they
properly cleaned. Pack-offs - a build-up ofcutting beds in the wellbore that resulted
from insufficient hole cleaning can be pin-
pointed, as well as the location of a forma-
tion fluid influx as they happen.
All major MWD/LWD service
providers can connect to the bottom end of
our network with successful deployments in
four continents, he says. You can also to
send instructions to, and diagnose problems
with, downhole tools without having to pull
the tools out of the hole.
We can actuate tools, diagnose in case
of problems, we update their settings. We
have seen cases where we reprogrammed
tools downhole, while without the connectiv-
ity of the broadband network this would have
required to trip the tools to surface to perform
this task.
When the tools are used on a broad-
band network, you have the bidirectional
communication with the ability to fine-tune
the settings of the downhole measurement
tools and have the ability to diagnose tool
problems while the tools are still downhole.
Mr Veeningen says that the technologycould also be used in completions and well
tests.
The next generation downhole tools
could be actuated with a click of a mouse, as
opposed to running slick line, he says.
are apart, the more signal at-
tenuation. Electronic re-
peaters, running on batteries
are installed every 450m of
drill pipe to boost the sig-
nal.
Although the concept
of a broadband network
looks very simple it took a
long time to figure out how
to do it, says Monte John-son, R&D Manager software
and electronics, with Intel-
liServ, the division of NOV
which developed the net-
work.
The broadband net-
work provides full range of
benefits. For example, 10%
time savings has been real-
ized simply through the abil-
ity to quickly downlink in-
structions to the rotary steerable tools insteadof the normal communications using the mud
pumps for downlink communications, he
says.
This result in better borehole manage-
ment as the rotary steerable commands can
be sent more frequently.
All service companies connectDaan Veeningen, business development man-
ager, Intelliserv, emphasizes that NOV pro-
vides the oil industry a network, not just a da-
ta communication link from the bottom of the
drill pipe to surface.
Sensors placed at network nodes all
along the drill string at discrete intervals take
measurements of the annular pressure and
temperature. This high-definition informa-
tion in real time helps ensuring the hole is
Intelliserv's wired drill pipe - an inductive coil onthe end of each pipe section communicatesdata to the next length of pipe, withoutneeding a direct metal to metal connection
IntelliServ's networked drill pipe can carry data at 57,000 bitsper second from measurement tools in the bottomholeassembly and for the first time all along the drillstring. In the
photo - the electronics in the link subs get checked before beingassembled into the pipe
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Communicating from downhole with a chirpCalgary company XACT Downhole Teleme-
try Inc. has developed a way of transmit 20
bits per second (bps) uncompressed data from
downhole to surface that is independent of the
drilling fluid and formation properties.
This impressive data rate is a big im-
provement on the typical 0.5 to 3 bps for mud
Pulse and the 3 to 6 bps for EM telemetries.
XACT predicts it will increase this rate to 40
bps this year.
To date XACT has drilled more than 125
wells using acoustic technology, including a
vertical well of more than 3,000m measured
depth.
Many companies have tried using sound
energy to carry drilling data from the bottom
hole assembly (BHA) in a live drilling envi-ronment, but have not been successful.
The trick, says Dr. Paul Camwell,
XACTs CTO, is to understand the acoustic
channel i.e. work within the constraints of
how the acoustic energy moves up the drill
pipe, and the optimum way it should be de-
coded at the surface.
The original work was carried out at San-
dia National Labs (New Mexico) under the di-
rection of Dr. Doug Drumheller in the 80s and
90s, and today XACT leads the industry in
carrying out the R&D necessary to protect andcommercialize the technology for drilling ap-
plications.
The acoustic wave utilized by XACT
travels through the drill string independently
provide complementary technologies. For in-
stance, XACTs through-bore tool aides thedeployment of the ThruBitTM suite of Surel-
ogTM logging tools, and XACTs high data
rate and third-party interface enables a lower
cost drilling and logging solution for clients.
XACT clamps an Electronic Acoustic Receiver(EAR) around the kelly saver sub to receiveacoustic data sent from near the drill bit tosurface via the drill pipe walls, and hence byradio to the driller.
of drilling fluid and formation properties, de-
pending only on the presence of metal drill
pipe. Thus underbalanced drilling is a natural
application for their tool.
The telemetry signal is carried in the drill
pipe and comprises data bits that are encoded
via a series of chirps - a sweep of frequencies
in the 650Hz range. The energy source that
generates the chirps is a piezoelectric stack
that transforms high voltage electrical waves
into mechanical waves, these being introduced
into the surrounding steel of the acoustic
telemetry tool and hence into the drill string
where they propagate at speeds of approxi-
mately 5,000m/sec.
XACT is also presently commercializing
distributed sensor nodes that can be placed atappropriate distances along the drill string.
These, like the primary tool in the BHA, are
able to measure drilling parameters such as
pressure, temperature, shock and vibration.
The distributed nodes can also detect and de-
code the acoustic signals received from below
and relay them on to the surface at higher pow-
er, thus providing greatly extended telemetry
range.
The major investor in XACT is Shell
Technology Ventures Fund 1 BV. The fund is
managed by the independently-owned compa-ny Kenda Capital BV. The Fund specializes in
funding companies that provide step-change
technologies primarily in the upstream oil and
gas sector, particularly when such companies
Schlumberger new drilling telemetrySchlumberger has launched the Orion II*
telemetry platform to increase the rate of data
transmission to surface from their downhole
logging-while-drilling (LWD) and measure-
ment-while-drilling (MWD) services. It also
cancels drilling and rig noise that adversely af-
fects data quality.
Downhole, new compression algorithms
increase the quantity of data transmitted at a
given physical telemetry rate, and new signal
modulation methods push mud pulse signals
further.
At the surface, new signal detection and
noise cancellation methods demodulate ex-
tremely weak signals at high physical teleme-
try rates to enhance data quality.In fact, the system can send 12 bits per
second of actual data through the mud - called
physical telemetry.
The system also possesses new data com-
pression technologies that can compress a data
stream as high as 120 bps -
known as effective telemetry.
When a service runs the Orion
II telemetry platform 120 bps
are effective on a 9 bps physical
telemetry rate.
Log curves can be com-
pressed instead of compressing
individual pieces of data. This
enables an excellent compres-
sion ratio with no deviation from
recorded data, says Gilles Vie,
Schlumberger product champi-
on for Orion II.
The system was used on
the longest well ever drilled, at40,320 ft well for Maersk Oil Qatar.
During the project, 3 bps were sent while
drilling at depths up to 35,000 feet where the
MWD was downlinked to 1.5 bps telemetry,
which was used to total depth. During the proj-
ect, Maersk Oil Qatar also ran the Schlumberg-
er PowerDrive* rotary steerable system, geo-
VISION* imaging-while-drilling service and
adnVISION* azimuthal density neutron tool.
*Mark of Schlumberger
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Drilling technology - evolution orrevolution
The second plenary session of the IADC (International Association of Drilling Contractors) conference in
Amsterdam, March 17-19, had the theme technology evolution or revolution, talking about how thedrilling industry develops new technology, and whether it is innovative enough to develop newtechnologies and methods needed to help produce the oil which the world needs.
Lance Cook, global wells technology manag-
er with Shell, and chair of the session, stressed
that we'll need all the innovation and innova-
tive people we can get to get the hydrocarbons
the global economy is projected to need in to
the pipelines.
I feel that this industry is quite innova-
tive, he said. If our industry wasnt as inno-
vative and capable of delivering, the prognos-tications that peak oil would occur in the
1970s or 1980s would have been correct.
I believe the unprecedented economic
growth of the last century was enabled by the
cheap energy this industry provided, he said.
In 2005, we took 60 days to drill a
13,500 foot well in a tight gas field. Now its
a little over 3 weeks, with technologies like
rotary steerables and underbalanced drilling.
Meanwhile the wells are producing 3-4
times more than in 2005, due to technology
improvements in areas like fracturing. So adrilling rig in 2009 can put 10 times as many
hydrocarbon molecules in the pipeline as it did
in 2005.
If the auto industry did as well as that,
they'd be making 400 mpg cars.
Mr Cook noted that in this economic en-
vironment, it can be easier to find manufac-
turing space to build new/prototype equip-
ment. In the recent high activity times get-
ting manufacturing space was nearly impossi-
ble, he said.
Mr Cook observed that many revolution-
ary steps are driven by a crisis. This industry
is brilliant when we get into a corner, he said.
One example is Shell's work to develop
expandable casing, which was pulled from the
lab to solve a tricky problem. We couldnt
reach our objectives even with a new genera-
tion drillship we had commissioned. If we did-nt deliver a new method for getting the wells
to their objectives,we would have had to ex-
plain how we spent $350m on this new gener-
ation drilling rig for nothing.
Bob Bloom, NOVBob Bloom, senior vice president of National
Oilwell Varco, emphasized that people operat-
ing modern drilling equipment have access to
a wide amount of information that wasnt im-
mediately available in the past, and with to-
days advanced computerized controlled sys-tems, we can combine human intelligence and
experience with the control software to pro-
vide safer, more efficient, process oriented
drilling operations.
Drilling companies have been focusing
on knowledge transfer utilizing advanced
computer based training systems combined
with detailed hands-on courses and on-the-job
training. Training new personnel has certain-
ly been the most critical industry issue over
the last several years and we've done a great
job in that, and we're continuing to," he said.
"I don't worry about the 'great crew
change' - I think we'll get through it very well,"
he said. "There will be a big reserve of
boomers who will get tired of the golf course
and will come back. I have 3 associates 74
years old who came back to the industry."
One of the greatest breakthroughs in
drilling technology occurred in 1981 when the
top drive was developed, he said. "It revolu-
tionized our drilling performance and was one
of the most important changes in rig machin-
ery in 100 years."
With a top drive, it became possible todrill down triples or quads (tie together three
or four lengths of drill pipe) and back ream
(drill backwards in the reverse direction) while
circulating drilling fluid.
Another important development was the
high pressure washpipe, which can operate at
pressures of up to 7,500 psi where as con-
ventional washpipe systems can fail in under
50 hours of operation at high pump pressures
and elevated rotating speeds, he said.
High pressure wash pipe "has enabled
top drives to run over 1000 hours in high tem-
perature, high pressure and high speed appli-
cations without changing the washpipe," he
said. "That can save millions of dollars every
year in rig maintenance and unproductive
downtime."
One technology which didn't make it was
submarine drilling rigs (drilling from sub-
marines). "A project started in 1958 but it was
never built - the technical challenges were too
big," he said.
However those efforts led to the estab-
lishment of a company called " National Ad-
vanced Drilling Machines". This company de-
signed a 3000 HP land rig which could be op-
erated by one person - everything was mecha-
nized with little need for human involvement
on the drill floor.
This rig was also not successful - it hada 16 per cent down time and was very diffi-
cult to move. It had one of the first computer
control systems, using vacuum tubes, which
were easily damaged and needed replacing
every time the rig was moved.
I don't worry about the great crew change -Bob Bloom, senior vice president of NationalOilwell Varco
This industry is brilliant when we get into acorner - Lance Cook, global wells technologymanager with Shell
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Exploration and drilling
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However, some of this mechanical tech-
nology ended up being incorporated in the
NOV top drive, he said.
NOV is developing a new modular
drilling concept called the SPRED Rig, which
can drill wells three times more quickly than
today's rigs, and do casing and concreting op-
erations simultaneously on different well cen-
ters.
Another exciting new technology is us-
ing hammer mill technology on offshore rigs,
which can thermally treat turnings allowing
them to be dumped safely overboard without
causing environmental damage. "This can
save millions of dollars annually from not hav-
ing to transport drilling wastes to shore for
cleaning and disposal," he said.
Moving into the future "we need the right
people in our companies they need to be in-
novative, not afraid to fail, and enjoy collabo-
rating with others" he said.Mr Bloom said that new ideas often
come from small groups of 1 or 2 people.
One example is the active heave draw-
works (the pipe hoisting mechanism on some
new offshore rigs). "It was conceived in the
1980s in a relatively slow time," he said.
"One man championed that idea for 4-5 years
and there were a lot of naysayers, but eventu-
ally the idea was accepted and proved to be a
revolutionary product for the industry."
Luis Cortes Xavier Bastos, PetrobrasLuis Cortes Xavier Bastos, general Managerof Well Construction Engineering, Petrobras,
said that technology has added a lot of com-
plexity to our construction process it added
to the risks, he said.
Drilling performance has not improved,
in how much power reaches the cutting edge.
Only a small fraction of power reaches the
drillbit most is wasted in friction.
Non productive time has been constant
at 20-30 per cent for the past 20 years.
Lost time accident rates are high com-
pared to other areas of the oil business, he
said.
An interesting trend for the future will be
niche intervention vessels drilling rigs for
specific types of drilling jobs. A rig is not a
swiss knife, you cant use it for everything,
he said.
Are there any outsiders preparing a rev-
olution eg in space, robotics, nanotech in-
dustry? he asked. I dont know but we have
to be aware of them.
Innovative developments are often driv-
en by necessity ie people invent new thingswhen they are forced to, said Mr Bastos.
Tim Juran, SeadrillTim Juran, executive vice president, Seadrill,
noted that although the basic rig format hasn't
changed in
30 years, the
specifica-
tions have
changed.
For ex-
ample, the
typical maxi-
mum depths
of water be-
ing drilled
through have
increased
from 1,500
feet in 1981
to 10,000
feet now;
whilst typical
well depths
have in-
creased from 15,000 feet in 1981 to 35,000feet now.
Hoisting capacity has increased from 500
tons in 1980 to 1250 tons now; drill rig power
has increased from 8,800 hp on 1981 to 56,000
hp now, and rotating power has increased from
35,000 lb ft (using a kelly drilling) to 105,000
lb feet (using a top drive).
In 1981, rigs were typically kept in posi-
tion using mooring lines, but now they usual-
ly use dynamic positioning, he said.
The number of data points has increased
from under 50 to over 10,000.Pro-active formal risk assessment sys-
tems have evolved.
Drilling is planned around the technical
limits of the equipment.
The crew complement on platforms has
increased from 80 beds to 200 beds - and
theyre all filled, he said.
Troubleshooting has changed from see
it / fix it to remote diagnostics, he said.
Crew are given formal training, not just
soak time (time on the platforms where they
are expected to absorb everything).
The current generation of rigs, he said,
can be described as 6th generation which he
described as having prominently dynamic po-
sitioning, ultra deep drilling capability, next
generation control systems.
They also have a turnkey shipyard deliv-
ery where the entire rig is put together with
a shipyard, and the shipyard contracts directly
with the drilling equipment manufacturer to
provide the drilling system.
There is plenty more to be desired, he
said.
We must compress the competency de-velopment cycles for our people that is ab-
solutely essential.
Mr Juran said he would like to see a stan-
dard operating environment developed for
drillers, where they are provided with only es-
Innovators often come whenthey are forced - HalvorKjrholt, chief researcher,drilling and wells,StatoilHydro
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ger' a
drilling tool
which can be
used for ex-
ploration it
literally
drills down
by itself and
clogs the
hole behind
it.
It is im-
portant that
oil compa-
nies make
the effort to
support
small com-
panies,
rather than
only workwith large service companies, as many are
tempted to do. We make a lot of effort to sup-
port small companies, he said. Small com-
panies come up with good ideas but not a com-
plete product.
IADC advanced rig technologycommitteesThe International Association of Drilling Con-
tractors (IADC) has established an 'Advanced
Rig Technology Committee' to help imple-
ment new rig technologies, chaired by DavidReid, vice president, E&P technology & busi-
ness for National Oilwell Varco.
The Committee's mission is to improve
rig safety and efficiency with sound operating
procedures, good automation and standardised
automation. It will look at the control philoso-
phy, the communications protocols between
equipment, personnel competency, and find-
ing ways to implement a comprehensive au-
tomation of the complete drilling process, in-
cluding integrating surface and downhole
equipment, and completions systems.
It has subcommittees for oil and gas op-
erators , reliability (looking particularly on the
top drive), guidelines (application of technol-
ogy), control motions (looking at static and
non static motions in drilling control), soft-
ware interface group communications be-
tween manufacturers, and future technology
trying to understand future needs.
In particular, the subcommittee will be
encouraging drilling contractors to provide
more detailed reports of problems they are en-
countering with top drives, which can be
shared with equipment vendors. It will alsomaintain a database about which technology
is being used where.
Further information is on the IADC web-
site www.iadc.org click on the section at
the top 'committees'.
2
Exploration and drilling
digital energy journal - April - May 2009
sential information.
Id like to see us improve integration of
the rig with third party services, he said.
I want to take remote diagnostics to the
next level make predictions before down-
time occurs.
We have to continue to figure out how
to prevent hurting people and get to the point
where were not hurting anybody, he said.
Halvor Kjrholt , StatoilHydroHalvor Kjrholt, chief researcher, drilling and
wells, StatoilHydro, said that Statoil currently
gets 60 per cent of production from subsea
wells (wells with a Christmas tree on the
seabed). The trend is to put more and more
advanced equipment on the seabed, he said.
Average drilling performance in terms of
metres per day has been fairly constant over
the last decade. There were some improve-
ments around the year 2000 but then it wentback again, he observed.
Non productive time for rigs has stayed
at a fairly constant 20-30 per cent between
1998 and 2008, he said.
Improving this will probably require
more automation, he said.
Drilling is almost 100 per cent manual-
ly controlled, he said. People make mis-
takes. We have very little room for mistakes
theres not much forgiving in an operation to-
day. People are slower than computers in re-
acting.Besides the official calculated non pro-
ductive time, there is also what Mr Kjrholt
terms the unofficial nonproductive time the
difference between what is achieved and the
technical limit of what the drilling rig can do.
For example, on average a pipe connec-
tion takes over 2 minutes but an automated
system could do it in half a minute. With a lot
of pipe connections this adds up to a large
amount of wasted rig time.
I propose a focus on automation and
control processes, he said.
It is less dependent on individual's skills
and interpretations. We can handle low mar-
gins. We can have fast detection and reaction,
and superb repeatability. You can get closer
to the technical limit.
In future, Mr Kjrholt hopes to see a bet-
ter understanding of hole stability and hole
cleaning. We can limit operations in the well
to what is necessary, he said.
Mr Kjrholt said there is something of a
conundrum with the way the oil price encour-
ages innovation. When the price is low you
cant afford working on new ideas when theprice is high you dont have the time, he said.
Innovators often come when they are
forced, he said.
One of the most exciting new technolo-
gies being supported by StatoilHydro is a 'bad-
David Reid, vice president, E&Ptechnology & business forNational Oilwell Varco,Chairing the IADC AdvancedRig Technology Committee
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50 per cent faster drilling with APSactive damperAPS Technology has developed a system to keep your drillbits in constant contact with the formation byreducing bit bounce and stick slip which could help you drill 50 per cent faster, and make your drill bitslast 25-30 per cent longer.
Connecticut company APS Technology Inc
has developed an Active Vibration Damper
(AVD) for drilling, which can enable rate
of penetration to be increased by 50 per cent,
and make each drillbit last 25 to 30 per cent
longer, whilst helping to protect MWD/LWD
electronics.
It has already been used to drill 8 wells
in Texas and Wyoming.The AVD uses a patented damping
valve section employing a proprietary fluid
containing micron sized magnetic particles,
which changes the tools damping character-
ictics when a magnetic field is applied.
This fluid technology, known as mag-
netorheological, was originally developed
over 100 years ago, and has been used as a
damper on Ferrari cars, but this is the first
time it has been used to stabilize drillbits.
Drill pipe is typically an inch or more
smaller in diameter than the drilled hole, sothere can be a lot of rattling about, also
known as whirl. Weight-on-bit (WOB) and
rotating speeds may vary from moment to
moment.
Stabilisers are commonly used to try to
stop the drillpipe from whirling, but some-
times the stabilizers and drill bit get stuck as
the drill pipe rotates and moves downwards,
and then periodically jerk, a phenomenon
known as stick/ slip. Another type of
harmful vibration is axial vibration or bit
bounce.
The force a drillbit makes against the
rock due to whirl, stick/slip and bit bounce
can exceed 50 times the acceleration due to
gravity (g), a force big enough to cause a lot
of damage to the drillstring components in-
cluding bits stabilizers and MWD instrumen-
tation..
The AVD is designed to detect and
adapt to the resulting vibrations within mil-
liseconds.
Normal dampening techniques (such as
springs) do not work as well for stabilizing
drillbits, because the level of vibrationdamping is constant and sometimes drillers
need a lighter or stronger damping coeffi-
cient to get the smoothest ride. Spring may
also oscillate at certain speeds.
The APS tool constantly measures the
forces on the drill bit, and how viscous the
dampening fluid around the drill bit needs to
be, to keep the drillstring properly damped.
A magnetic field of appropriate strength is
applied around the MR fluid which causes it
to change viscosity. The MR fluid changes
from a free flowing oil to a extremely vis-
cous grease (with viscosity of cold peanut
butter) in milliseconds. The viscosity of theMR fluid and therefore the damping charac-
teristics of the AVD tool can be continuous-
ly adjusted based on drilling conditions.
The magnetic field used to change vis-
cosity of the MR fluid is created by large
coils, which use up to 150 watts of direct
current electricity generated by a mud tur-
bine alternator -- also made by APS Tech-
nology -- within the AVD.
I like to refer to it as a damper with a
programmable viscosity oil, said Steve An-
dersen, vibration product line manager withAPS.
The company won funding from the US
Department of Energy to develop the idea,
and it also partnered with a drilling compa-
ny for a certain period of time (under re-
quirements for DoE funding that companies
must be in partnerships).
Dirk Bosman, regional manager for
Middle East and North Africa with APS, be-
lieves that the company has faced some ob-
stacles in AVDs take-up, because it relies on
the support of drilling companies who also
make a lot of money selling drillbits and
are not so keen on any technology which
makes the drillbits last longer.
So it is important that oil and gas oper-
ators are well aware of the technology, so
they can demand that their drilling contrac-
tors use it and share in the cost savings de-
livered by longer bit runs and improved
ROP resulting from use of the AVD
tool.
The company is setting
the price of the tool so it
will be cost effectivewhen used both off-
shore and on-
shore.
Many of
the staff of
APS were previously employees of a com-
pany called Teleco Oilfield Services, which
was acquired and became Baker Hughes IN-
TEQ in 1992. Teleco was the first company
to develop commercial measure while
drilling (MWD) tools in the late 1970s.
If the drill bit is steadier, it can drill muchfaster
Drilling with APS Technology - a dampenerchanges viscosity 10 times a second, to keepthe drillbit as steady as possible onthe rock.
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Exploration and drilling
The biggest strength of the software, says
Agnes Scott, senior account manager
Americas with SPT Group, is the ability to
model transient effects within any drilling
operation.
For example, the difference in mud
pressure while drill pipe is being pulled in
and out; the way mud expands as it goes
deeper underground and increases in temper-
ature; the way the well slowly returns to ge-
othermal conditions (the same as the rockaround it) if there is no drilling going on.
Most other drilling simulator packages
on the market only offer a steady state simu-
lator, she says.
By modelling transient aspects of the
drilling, the software can go a few per cent
further than most other drilling simulation
packages on the market, she says.
Drillbench is used primarily in narrow
margin (particularly difficult) drilling opera-
tions, such as high pressure/high tempera-
ture wells and deep water applications,where you have to manage the drilling mud
carefully, taking into consideration both tem-
perature and pressure effects.
The new version of the software has
improved layout, reporting functions, and
easier exporting of data.
The new version has a tool to model the
gelling effect of your drilling fluid the way
fluid will gradually thicken if drilling is
stopped, making it slightly harder to start
drilling again.
It makes a huge difference to opera-
tional parameters, says Ms Scott. Mud
companies give you standard gelling param-
eters everybody knows that but it has not
been possible to visualize it before.
The new software has tools to model
multlple fluids in one circulation eg when
during a cementing operation, the well is
filled with a spacer, cement, spacer and then
mud. You can model the whole process in
one go.
Using Drillbench
The software is designed to be used bothwhile a drilling operation is being planned,
and also while it is running.
During drilling operations, by compar-
ing the drilling data with what is expected,
you get a quick indication if something
might be going wrong, she says.
And when an operation is completed,
you can run another simulation, to see if can
see if you can get the actual results in your
simulator, to get a judgement of how accu-
rate you data is.
The software is often used after a
drilling operation when people say we saw
something strange, can you try to see what's
happening, she says.
The software can be used for trainingand preparation purposes, to get a better un-
derstanding of the wells operational limita-
tions and to be better prepared for unplanned
events.
The software has been under develop-
ment for 11 years this is the version 5.
TestimonialsBP Aberdeen uses Drillbench for well plan-
ning and follow up, and also crew training
on high pressure, high temperature wells in
the UK.Shell USA says that it used Drillbench
to simulate its underbalanced drilling proj-
ect, and managed to discover underbalanced
drilling features it couldnt have found using
steady state software.
Baker Hughes Inteq says it used Drill-bench when planning drilling for its Marlin
A-5 well, and found the program made ac-
curate predictions of the downhole tempera-
ture and density profiles, as confirmed by the
downhole measurements.
StatoilHydro says it used Drillbench
when drilling its first deepwater exploration
well in Angola. It needed to drill the well
deeper than originally planned, and it used
the software to work out how it could safely
stretch the well design and saved one casing
string.
Wild Well Control Inc (USA) says it us-
es Drillbench to assist clients with critical
well planning and resolution of problems, in
particular analysing kicks and emergency re-
sponse operations.
StatoilHydro Zagros Oil & Gas, Iran
says it used Drillbench to plan wells of over
5000 total vertical depth in a remote area of
the Iranian desert, to identify limitations, op-
timize the casing program and cut costs, us-
ing the software both in planning and execu-
tion.
ConocoPhillips Scandinavian divisionsays it used Drillbench for decision making
in two difficult high temperature, high pres-
sure wells, and the software made a big con-
tribution to the companys ability to reach its
planned targets.
SPT Group launches new version ofDrillbenchNorwegian software and simulation company SPT Group has launched a new version of Drillbench, its
software for simulating and modeling drilling operations.
Mud companies give you standard gellingparameters everybody knows that but ithas not been possible to visualize it before -
Agnes Scott, senior account manager Americas with SPT Group
Simulating and modelling drilling operationsusing DrillBench
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SPE Offshore Europe is where theE&P community meets to find thesolutions required to keep up withan accelerating technology race,and understand the demands ofa changing industry committed toensuring security of supply in anincreasingly complex world.
Learning. Innovation. Debate. Solutions.
Register for free for the
conference and exhibition at
www.offshore-europe.co.uk
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Oil and gas production
digital energyjournal - April - May 2009
Germanischer Lloyd and Noble Dentonmerge to create largest oil and gas
engineering consultancy
The company will provide a broad range of
technical services and consulting, to help oil
and gas companies make sure that what they
are doing is safe.
Both companies already have many
joint clients in the oil and gas industry, in-
cluding ConocoPhillips, Shell, BP, BG,Chevron, Exxon, Total, ONGC, Saipem, Sta-
toilHydro, Transcocean.
Germanischer Lloyd clients include
Hess, Talisman, Wood Group, Saudi Aram-
co, Repsol, Gaz de France, Petronas, and
Noble Denton clients include Petrobras, Ak-
er, APL, Heerema Energy.
GL employs over 5,500 skilled engi-
neers. It was founded in 1867, and its 2008
revenues were Eur 544m.
Noble Denton employs around 900 em-
ployees. It was founded in 1904, and its 2008revenues were GBP 100m (Eur 108m).
Pekka Paasivaara, member of the Ex-
ecutive Board Germanischer Lloyd, says that
many oil majors are looking for an engineer-
ing technical consultancy with a global
reach, and GL is keen to be that company.
Oil companies are searching for a technical
services partner on a global scale, he says.
This is particularly true for national oil
companies, which often do not have the in-
depth technical expertise in-house which in-
ternational oil companies have.
The combined company has offices in
all oil and gas centres, including Houston,
Mumbai, Jakarta, Kuala Lumpur, Singapore,
Doha, Abu Dhabi, London and Aberdeen.
Most clients are asking for local presence,
says Mr Paasivaara.
Services include technical and opera-
tional assurance (agreeing that plans are
technically and operationally OK), inspec-
tion, safety and risk consulting, engineering
design, software, testing, helping maintain
reliability, casualty investigation, as well as
project management.The focus is on all areas of oil and gas
industry and energy including renewables
and power.
Technical assurance is providing com-
panies with a second opinion that what they
are about to do will be safe. For example, if
a company is transporting a $500m topside
from South Korea to Africa, you want more
than for one company to say trust us, it will
be alright, says John Wishart, group man-
aging director of Noble Denton,
Both companies have undertaken arange of acquisitions over the past few years.
Last year, GL bought Advantica Group,
the former consulting arm of upstream gas
company BG, among a range of other acqui-
sitions, and Material Consulting Services, a
downhole consulting business in Houston.
Over the past few years Noble Denton
has acquired Martech Unlimited, a company
specialising in tanker vetting services, Po-
seidon Maritime, a dynamic positioning con-
sulting company, among other acquisitions.
Noble Denton has deep expertise indeepwater oil and gas, including about dy-
namic positioning of platforms, complex
mooring systems. It has expertise in the full
range of offshore equipment, including drill-
ships, FPSOs, floating LNG, pipelines, plat-
forms OSV, subsea systems.
It has a strong presence in Norway,
where it is able to get involved in a lot of the
technical development for offshore equip-
ment.
Growth areasThe companies are
keen to provide more
services for the grow-
ing wind energy sector
both onshore and off-
shore. Germanischer
Lloyd already has a
large consulting busi-
ness in wind power it
is currently helping
Gaz de France install a
wind park in Mexico.
There is particu-lar growth in demand
for technical expertise
in the deepwater envi-
ronment, including in
West Africa, Brazil,
Gulf of Mexi-
co and
Venezuela,
says Mr
Wishart.
There's
emergingtechnology -
there's always
a greater need
for assurance
and integrity,
he says.
Carbon
capture and
storage is
seen as an in-
teresting busi-
ness area.It would
also like to
expand further globally including in Chi-
na, Russia and Vietnam, Kazakhstan, Brazil,
West Africa, India and Australia. It also
wants to build up the corporate knowledge.
Noble Denton is one of the few compa-
nies in the sector which is able to provide in-
dependent advice, says Mr Wishart. In our
case, we have no-one behind us pulling the
strings.
Two engineering technical assurance companies, Germanischer Lloyd and Noble Denton, have mergedoperations to form what is probably the worlds largest oil and gas technical services company, with 6,400employees in 80 countries.
Oil companies aresearching for a technicalservices partner on a globalscale - Pekka Paasivaara,member of the Executive
Board Germanischer Lloyd
Noble Denton is one of the world's largest offshore consultancycompanies
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Oil and gas production
17
Lessons from the US Air ForceThe oil and gas industry could learn a few lessons from the US Air Force in working out the best way toimplement and integrate new technology, says Houston oil and gas consultant Dutch Holland of Holland& Davis.
New technologies can be powerful and mind-
bending, especially in digital energy (DE).
Ever stepped into a visualization (viz)
center and put on the 3D goggles to watch col-
orful strata spun upside down and inside out?
Technologies can fascinate, intrigue and, most
importantly, change how the world works in
ways often dramatically better than yester-
year.
New technology can also be perplexing
when being moved from scientists hands in
research and development to everyday appli-
cation within an organization, as companiesattempt tying new technologies into opera-
tions.
Although technology integration was
not invented just the other day, the results in-
variably make it seem as if that were the case.
Implementation scenarios still play out ad-
versely at too many companies trying to
bridge R&D and operations. Why is the tran-
sition still so difficult and whats the solution?
Apples, oranges and test pilots
When executives attack problems within theircompanies, the tendency is to draw upon
knowledge about their specific industry, their
experience within that industry and experi-
ences of colleagues and customers within that
same industry.
Looking outside oil and gas, therefore,
seems to be comparing apples and oranges.
In other words, management is advised to
stick to the business they are in when brain-
storming for answers.
But the real-world tells a different story:
Look anywhere for solutions and find them
in seemingly unlikely places.
For example, who would guess that a
world-class solution for complex technology
integration for the oil industry might actually
come from the United States Air Force (US-
AF)?
The USAF invented the box, referred to
as an intelligent interface (Figure one), be-
tween R&D and operations to not only sup-
port technology integration but to actively
participate in product and mission innovation.
Since its formation in 1947, the USAFs
mission has called for continually improvingtechnology. Therefore, being technically-ori-
ented thinkers and overachievers, they devel-
oped an intelligent interface which has been
the key to innovating and integrating every
new aircraft into operations for more than half
a century.
So, to
get inside the
worlds most
effective inte-
gration of new
technology,
temporarily
suspend the
whole idea of
working at an
oil company,
don the test pi-lot gear and
get ready to
see how ex-
cellence is
routinely
achieved.
Home to the USAF intelligent interface
is Edwards Air Force Base, where the Test
and Evaluation Squadron and the USAF Test
Pilot School are located.
The test squadron ensures that all new
technology meets mission requirements and apivotal part of the process focuses on using
operational personnel who have completed
test pilot school. In other words, the interface
includes people from both operations and
R&D sides.
However, not just anybody can be air-
borne at Edwards AFB; only the best and
brightest are selected for this prestigious
school, with some applying several times be-
fore acceptance.
Ten years of pilot experience is required,
of which five years must be in a command po-
sition.
Further, although bravery and flying
skills are requirements, much more is de-
manded. This includes scientific and engi-
neering knowledge, critical and reasoned
judgment and managerial skills of the first or-
der.
They must also have an affinity for me-
chanical systems, an ability to feel the air-
plane, a well-honed sense of what is happen-
ing at all times and mature, reasoned judg-
ment. Upon acceptance, applicants undergo a
40-week intensive training program directed
at taking day-to-day operational opportunitiesand turning them into real technology proj-
ects that come back as airplanes.
Applying this to digital energyIn the ongoing goal to make new technology
work for a companys greater good, simply
linking an innovation to operations is not
enough.
The use of an intelligent interface helps
ensure that the power of DE technology is
used to enhance daily business operations,
now and in the future.The technology integration problem
stands out when people try to take complex
and sophisticated DE innovations and tie
them into a complex and sophistical opera-
tions system without the use of an intelli-
gent interface.
In place of an intelligent interface, how-
ever, is often a very unsophisticated integra-
tion approach staffed by transaction-oriented
personnel, frequently with little or no opera-
tional experience.. A passive, transaction in-
terface just is no substitute for an intelligent
interface that can analyze, modify and im-
prove the both operations and the technology.
Depending on ones perspective that
may seem doable or difficult but, whichever
applies, the DE/intelligent interface must op-
erate with a set of attributes. If not, once
again the necessary integration either will not
happen or will be exceptionally bumpy and
ultimately unsatisfactory.
One, a DE Intelligent Interface must be
a formally chartered function, not a set of in-
formal practices that may or may not have
worked in the past.Two, it must have leadership backing
and assigned responsibility to do this inter-
face, backed both by operations and the R&D
or IT side.
Three, the Intelligent Interface must
Look anywhere forsolutions and find them inseemingly unlikely places -Dutch Holland, CEO,Holland & Davis
Figure 1 - the US Air Force likes to see researchand development well integrated withoperations
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and insertion, not have technology done to
them.
On the downside of not getting the po-
tential of technology due to not interactingand innovating around it, again an AF simi-
larity exists.
Not achieving technology integration
would be like the AF commissioning Boeing
to build an airplane, but never having the op-
portunity to test it and see if it could fly new
and different types of missions.
This causes them to miss out on a huge
element of both innovation and integration
since many innovations come from the Ed-
wards AFB test environment and go back to
Boeing for airplane improvement.Whats happening right now is that the
best and brightest still work very hard to get
into test pilot school because they know it is
the critical link between R&D and the flying
world. This is precisely not where the DE
world currently is.
In other words, more operations people
need to figuratively stand on stage and reach
out for the opportunities continually emerg-
ing from DE. The DE culture really needs
people who want to make things happen.
In order to do this, there must be a for-
mal organization spin, perhaps taking
lessons learned from the USAF. Not de-
pending on informally touching base across
the interface between R&D and flying, the
USAF employs a carefully planned DE intel-
ligent interface.
Today, this same kind of interface, while
only existing in some oilfield companies, is
something to which all companies can realis-
tically aspire and benefit from.
Oil and gas production
digital energyjournal - April - May 2009
have a mission focus, not a technology focus.
Four, the interface should have functions
shown inside Figure 2.
Essentially, the DE/Intelligent Interface
is powered by the disciplines and principles
of systems and change engineering.
Staffed by the highly qualified opera-
tions personnel, these people should have
some of the key attributes as those in the AF
test pilot school. That includes ten years in
operations, five years with bottom-line re-
sponsibility and high credibility with opera-
tions personnel.
Additionally, they are marked and des-
ignated as comers in the organization and
known as Operations Stars, or proactive lead-
ers who are consciously competent. The lat-
ter refers to being able to articulate what op-
erations needs, wants and is doing.
They are anchored in what we do in op-
erations and the way we do it, not in the the-oretical way it ought to be done. More vis-
cerally, these individuals have business oper-
ations in their bones. They have a general
understanding of the IT environment rather
than knowing the nuts & bolts of DE tech-
nology and they must keep conversations fo-
cused on the mission first.
Reaping the benefitsThe idea of figuring out how to best make DE
pay off, using the context of the USAF, is to
challenge readers to take some or all the ideasand evaluate their own DE implementation
effectiveness, competence, horsepower and
future potential.
Even though DE was not unveiled the
other day, it is still relatively new and person-
nel at companies throughout the world are
continuing to determine how to best get their
collective arms around both DE technology
and its integration problems.
How new? Consider that the Society of
Petroleum Engineers (SPE) in April is hold-
ing its seventh annual conference on DE. In
contrast, the USAF would have already held
its sixtieth conference.
That means that the entire interfacing
process, no matter how far it has come, is still
in its infancy compared not only with what it
is and could be but with what it should be.
The upside for USAF test pilots is that
by completing the school, they get an impor-
tant career boost; some become astronauts.
On the oil and gas side, leaders in the energy
business of tomorrow are those who will be
able to harness technologies, including DE,
for their operations.And who are the leaders? They are the
ones who actively and aggressively find tech-
nologies that enhance operations in the first
place, then getting these technologies inte-
grated. They will lead technology innovation
Figure 2 - the functions of the intelligentinterface
Tell us about your experiencesWere always looking for digital oilfield
implementation stories, cases (good and
bad) and good ideas to feature. Send your
input to dutch at hdinc.com
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Oil and gas production
digital energyjournal - April - May 2009
SpecTec new asset managementsoftware for oil and gas
The company that monitors 20,000 gaswellsOklahoma company Universal Well Site Solutions has implemented its remote monitoring and control system
at 20,000 coal bed methane wells including technology to switch your pump and on off remotely.
www.universalwellsite.com
Universal Well Site Solutions of Oklahoma
reports that its wireless well remote monitor-
ing system has now been installed on over
20,000 coal bed methane wells across the
US, and also in China and Australia.
All of the equipment to be installed at
the well head is supplied as a single unit,
called a UniSkid, which includes electricity