what vista could do for oil and gas spe's it technical...

February/March 2007 Issue 5

What Vista could do for oil and gas

SPE's IT Technical Section takes shape

Approaches to information management - from Shell, Aramco, ConocoPhillips, BP and Petro-Canada

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BYTES & BARRELS: AN ENERGY RENAISSANCE

11-12 April 2007George R. Brown Convention Center

Houston, Texas, USA

Register Now at www.spe.org/dec07

Society of Petroleum Engineers

fuck.qxp 09/02/2007 20:24

Feb/March 2007 Issue 5

Digital Energy Journal is published on print 6 times a year, supported

by a free website and email news serviceWe cover information technology and communications in upstream

oil and gas production,drilling / completions and exploration.

Each issue of Digital Energy Journal is mailedto 2000 oil and gas executives, as well as

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Subscriptions: GBP 195 a year for 6 issues.To subscribe, please contact circulation

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Front cover:Kongsberg Maritime's ASSETT training

simulator. Aker Kvaerner has signed acontract with Kongsberg for an ASSETT

simulator for a FPSO topside

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ContentsNews updateSPE's IT Technical Section Plans for the Society of Petroleum Engineers' IT TechnicalSection are starting to take place, with subcommittees forsecurity, professional development, systems integration andevents

Microsoft's new VistaDigital Energy Journal interviews Craig Hodges, director of oiland gas at Microsoft, about how he believes the industry canbenefit from Vista, Office 2007 and Exchange 2007

Equipment and communicationsEquipment news WellDynamics, Input-Output, Wavefield Inseis, Weatherford, Tideland Signal,INTEQ, Honeywell

Communications news Microwave Data Systems, Tyco, CapRock, Sperry, Alcatel,NesscoInvsat

Honeywell's wireless data Honeywell would like its self-healing wireless data standard tobe incorporated as part of a new international standard

SoftwareFlare and Shell information award Flare Solutions and Shell won a BritishComputer Society award for their informationmanagement catalogue, one of the clearestapproaches to the challenge we have seen

Scandpower's MEPO version 3 Scandpower Petroleum Technology has launched version 3 of MEPO, its tool tomanage the creation of multiple reservoir models, which should give you amore accurate picture than just one

Statoil signs up to Platform Statoil has signed up to use Platform Computing's computer managementsystem, so it can do complex number crunching on office computers whenthey are not being used, rather than in a central server farm.

Using good design to win licenses How an oil company won 80 per cent of the licenses it applied for, by askingPrime Design to make its application look more snappy

Digital Oilfield - 6782 per cent growth Digital Oilfield of Calgary has grown its oil and gas electronicinvoicing business by 6782 per cent in 2001 to 2005

Kongsberg buys Sense IntellifieldNorwegian collaboration centre leader Sense Intellifield has been acquired for$45.7m by Kongsberg Maritime. We asked president Borge Kolstad where thecompany is headed now

IQPC Exchange London

Oil & Gas Exchange 2006Our comprehensive report from the IQPC Oil and Gas Exchange conference inLondon November 13-14, with speakers from ConocoPhillips, Shell, ChevronTechnology Ventures, Aramco, BP, Petro-Canada and the UK Department ofTrade and Industry

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digital energy journal - February/March 200722

SPE's IT Technical Section takes shape Plans for SPE's IT Technical Section have evolved to defining a new role and status for the oil and gasIT manager, and helping the industry take a holistic approach to digital technology.

We spoke to Section founder Dr Mehrzad Mahdavi

The Society of Petroleum

Engineers (SPE's) IT TechnicalSection is starting to take shapewith the four subcommittees

holding telephone conference meetingsduring November to try to establishdirection.

The different subcommittees are: linkingsubsurface IT with the corporateenvironment (systems integration);developing a new discipline for the oil andgas IT manager (professionaldevelopment); addressing security of ITsystems (cyber security); and co-ordinatingall the initiatives together through events(umbrella industry forum).

Behind all of this is an objective topromote the use of digital technology inthe oil and gas industry, encouragingpeople from other areas of the industry tolearn more about what IT can do, raisingthe status of the oil and gas IT manager(and encouraging him / her to develop awider understanding of digital oilfieldapplications), and helping the industry lookat its IT strategy in a more holistic way.

In other words, to quote sectionchairman Dr Mehrzad Mahdavi, to "help theindustry to look at IT properly."

Dr Mahdavi's day job is vice presidentEnterprise Security Services atSchlumberger, running the company's ITsecurity consulting business, a business linehe personally built from scratch.

The idea for the Technical Section aroseduring SPE's digital oil and gas securityconference in London in December 2005,which Dr Mahdavi chaired.

Discussions about setting up an oil andgas IT security association evolved into

plans for a more general IT Section, whichcould look at all kinds of IT projects.

"After talking to many of the people inthe industry, it became clear that we needto expand on the horizon, talking aboutinformation technology rather than justtalk about security," Dr Mahdavi says.

"In SPE we have 8-10,000 people that areinterested in the area of informationtechnology and management. That area isnot served within the community."

Approval was given by the SPE board forsetting up an IT technical section in March2006. A first meeting was held in August2006.

The steering committee is MehrzadMahdavi, vice president, Enterprise SecurityServices, Schlumberger (chairman); SteveComstock, CIO upstream , ExxonMobil;Patrick Hereng, chief information officer,Total; Gary Masada, president IT, Chevron;Don Moore, vice president and CIO,Occidental Petroleum; and WashingtonSalles, president IT, Petrobras; RichardJackson, chief information protectionofficer, Chevron.

A board member of the IT technicalsection will be assigned to each of the sub-committees to help and provide guidance.

Of course, the Section will need strongsupport from the industry in order to beproductive.

"I encourage everyone to join theseinitiatives that we have started through thesubcommittees," says Dr Mahdavi. "It is avery efficient way of impacting how theindustry is going to move. I think this is tooimportant for our industry not toparticipate in fully."

"It is clear that digital energy is the mostimportant value proposition for copingwith the acceleration of the activity in theoilfield," he says.

"Our mission is to facilitate thedeployment and expansion of the digitaloilfield by bringing all the different aspectsof the information systems together."

"Companies that understand the valueof IT and the value of petrotechnicalintegrated with each other will be at aneconomic advantage compared to therest," he says.

"Then IT is no longer looked at as a costitem, it is looked as a part of what thecompany does."

Subcommittees The security subcommittee evolved fromthe first idea for the Section, which was toset up a 'Federated Identity' security systemwhich all oil companies could use, allowingemployees from one company to be givensecure limited access to another company's

intranet.This ambitious plan has now been

shelved, but the subcommittee insteadplans to look at sharing best practises, andhelping develop secure ways for oilfieldequipment to be connected to thecorporate intranet.

The November telephone meeting ofthe cyber security subcommittee was ledby Richard Jackson, chief informationprotection officer of Chevron.

Meanwhile a professional developmentsubcommittee has been established, todefine and establish the profession andcareer path of a dedicated oil and gas ITmanager, who will need an in-depthunderstanding of both IT and the differentcomponents of the digital oilfield.

The first telephone meeting was chairedby Steve Comstock, upstream CIO,ExxonMobil, who said in the meeting thathe saw a strong correlation between theindustry's ability to develop a hybridengineering/IT manager discipline, and itsability to bring the digital oilfield from thefuture to reality.

There is a systems integrationsubcommittee, which will look at how tospeed up the connection of subsurfaceequipment into the corporate ITinfrastructure. It will not try to developstandards (but will work closely withorganisations which do).

The first telephone meeting was chairedby Don Moore, vice president and CIO ofOccidental Petroleum.

Finally there is an events subcommittee,which will co-ordinate the association'sevents initiatives. It is already involved inthe plans for the April 2007 Digital Energyconference in Houston. The first telephonemeeting was chaired by Dr Mahdavi.

"Every day, as we keepgrowing in this journey,of organizing our industryaround this, with chieftechnology managers,CIOs and petrotechnicalasset managers, people aresaying, the day that youhad an IT person justdoing an IT work haspassed," says Dr Mahdavi.

Dr Mehrzad Mahdavi, founder of SPE's ITTechnical Section

News update

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February/March 2007 - digital energy journal 3

New kind of IT manager The professional developmentsubcommittee has a very interestingobjective, trying to crystallise a newdefinition of the oil and gas IT manager,including what he / she will do, whatexperience he needs, what he needs toknow about and what his career path willbe.

There is already a broad understandingof what a (for example) geophysicist,geoscientist or reservoir engineer shoulddo and know about, and it shouldultimately be the same for the oil companyIT manager.

In many oil and gas companies, the ITmanager is still somewhat ghettoised in arole as someone who looks after e-mail andbusiness software, not someone with therole of holding the whole companytogether, making sure everyone has thedata they need and creates the data whichthe next person in the chain needs.

"Every day, as we keep growing in thisjourney, of organizing our industry aroundthis, with chief technology managers, CIOsand petrotechnical asset managers, peopleare saying, the day that you had an ITperson just doing an IT work has passed,"says Dr Mahdavi.

Of course, as well as and IT managerswith engineering skills, the industry alsoneeds engineers with IT skills, or anunderstanding of what computers can do."You could also say the day that theproduction engineer would do theproduction work in isolation has passed,"

"That is the kind of things we arelooking for - in the new energy IT - type ofdiscipline, people that combine theknowledge of the workings of thepetrotechnical environment with verygood knowledge of IT."

"We are all immersed in this digitalenvironment now - the boundaries and theworkflows now are so interconnected -there's no way we can ignore each other,"he said. "My results of what I do, dependsvery hard on my knowledge of what the ITguys do."

Dr Mahdavi's own business profile, hesays, is an indication of the kind of role wecould be seeing in future - someone withexpertise in both IT and other areas of oiland gas.

"I spent a large portion of my career inthe petrotechnical environment, and Ispent time in technology centres -developing very high technology tools anddevices," he says.

"Through working with IT, I focused inthe security area - but I never went awayfrom the roots of where I came from, whichwas petrotechnical."

"Through my career I have used IT andsecurity in conjunction with my knowledgeof petrotechnical. I have found that to bevery efficient."

"If I have a good knowledge of thenetwork and the infrastructure that I'mworking with, I can organise my analysisand my computing environment, with myknowledge of what I want to get out of thereservoir."

Dr Mahdavi says."We need these disciplines to be

completely aware of each other, integratedin such a way that we can bring the idea ofadded value of digital energy into life."

Many oil and gas industrycommentators have said that by looking atIT and software in isolation from the usersand their business processes, you just endup with software which nobody findsconvenient in their work.

"People used to think of the pure ITperson, and say, this guy is IT, let him goand play with this IT stuff. You can nolonger operate that way if you have anyhope of having a digital oilfield," he says.

Don Moore, vice president and CIO, OccidentalPetroleum, who is on the committee's steering group

You are probably aware that

Microsoft has launched its newVista operating system, 2007Microsoft Office system and

Exchange Server 2007, together describedas the 'most significant product launch inMicrosoft's history'.

According to Craig Hodges, Microsoft'soil and gas director, the new systems willmake your company IT systems easier tomanage. It will be easier to put togetherstandard work processes for the company.Information management systems will beeasier to build and use. It will be easier tokeep your data secure and manage thesecurity. Microsoft Office will be easier touse and should help people be productive.

The oil and gas industry has beeninvolved in the product development.Several oil and gas companies signed up toMicrosoft's 'early adopter' program, making

suggestions about product design andfunctionality.

The software was made available tocompanies with volume licensingagreements November 30th, with a generalrelease on January 30th.

What is not so clear to many oil and gascompanies is why they should undergo theexpense and hassle of implementing thenew software products, when there is oftennothing obviously wrong with what theyare using already.

Although having seen users stumblewith Microsoft Office, or been through thepain of trying to set up and run a smallcomputer network, or have a failedinformation management project, or lostsecure data, it is perhaps easier to see thepotential benefits.

When you start to imagine the potentialof computer systems which are much

easier to build and manage, informationmanagement systems which give peoplethe information they need, data storagewhich is reliable and secure, and softwarewhich employees can get comfortable withinstantly, the argument for giving the newsoftware a try becomes a lot stronger.

Microsoft is strongly emphasizing thepeople-friendliness of its software, with itsmarketing message "your potential ourpassion."

It has commissioned a study fromCapgemini, showing that companies whichadopt the new software tools shouldexpect 'dramatic gains in productivity,through capabilities that address corebusiness issues in new ways,' through'process workflow automation, easieraccess to information, improvedcollaboration with colleagues, and lowercosts of compliance."

Information managementInformation management is a term whichmeans different things to different people,but Microsoft is trying to help peopleorganise their information in everypossible way.

"One of the key things - that we now

Microsoft, the world's largest software company, has made itsbiggest ever software launch, with the combined launch of Vista,2007 Office and 2007 Exchange. We spoke to director of oil and gasCraig Hodges, about how he thinks the oil and gas industry will benefit

Microsoft's new launch

News update

fuck.qxp 09/02/2007 20:25 Page 3


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bring to the table is the ability to managecontent," says Mr Hodges. "The ability tomanage that data - and properly catalogueit, is of high importance."

"I think every company is unique andwill manage data differently," he says.

To make it easier for people to finddocuments, there is a functionality called'business data catalogue,' which enablesdocuments to be indexed.Software systems can easily be builtaround the indexing, to serve up thedocuments that people need quickly,wherever they are stored in the company.

There are tools to make it easier tomanage key performance indicators, soyou can see how well business is going ona single screen, and different views of thedata can be developed for people indifferent roles. It will be easier to buildsystems to gather data uniformly acrossthe company.

It will also be easier to manage theinformation which is not held in officialcompany documents, should they want to.

"Over 80 per cent of data today - residesoutside corporate systems," Mr Hodgessays. "They reside on your PC, my PC and inour head, and in our experiences."

"We're dealing with a world today thathas an explosion of data in a variety offormats - in a variety of locations. The bigchallenge facing our customers today ishow do I manage all of that capabilitytogether."

It is important for companies to get thebenefit of shared expertise. "Let's say, ifyou're in the Sakhalin Islands, you needsome expertise to solve a problem overthere," he says. "We have the ability forpeople to make visible their expertise."

The software has more powerful toolsto put together group workspaces,structured documents, and buildcollaborative workflows.

The SharePoint Server tool, which is partof Microsoft Office, helps co-workers to co-ordinate their schedules, organisedocuments and get involved indiscussions. They can find people in thecompany with specific expertise.

There are tools to help companiesstructure workflows, so employees have

the right data at their fingertips for the jobthey need to do next, they know exactlywhat to do, and they leave the data they create in the right format to make it easyfor the next person in the chain.This will, in turn, help support companies inone of their biggest projects,trying to standardise the way they dothings (processes) in the company. "Mostcustomers in the oil patch - have beenfocused for the last 5-7 years on processstandardisation," says Mr Hodges.

AdministrationThe new systems should prove a great dealeasier to manage.

Servers and networking software mayhave improved over the last ten years, butthat is hard for an IT administrator tonotice, because the demands of users forfaster networks, sending more data, withincreased security, has meant that runninga company network has never been easy.

Microsoft promises that the newsystems will be easier to install, standardiseand manage across a company.

Security systems will also be easier tomanage. There will be tools which candeny access to a certain document evenafter you have e-mailed it to someone, ifyou discover that it may have reached thewrong hands.

There is a tool to encrypt all the data onyour hard drive, "BitLocker," so when youthrow it in the rubbish bin when you buy anew computer, no-one will be able to readit.

There is a tool to manage make sure allof your employees are looking after theirdata properly.

"We've spent considerable energy onimproving security," says Mr Hodges. "Allcompanies - are going to be requiringemployees to securely manage data - andnot allow it to be compromised."

PeopleOn the people side, the user interface onMicrosoft Office has been redesigned tomake it more user friendly, after manyhours of testing.

As part of the product development,Microsoft watched customers work using

its software in a billion user sessions."These kinds of very subtle things haveimpact on people's day," he says.

"I had a CIO of a major oil company - sayto me a few weeks back, If you can help mesave a few minutes a day - we will havetremendous business advantage from justthat."

"Just helping us save 3-5 minutes a day -helping us use the tools more effectively -that would be great for us."

CommunicationsMicrosoft has put a lot of effort intomaking it easier for people tocommunicate and work remotely.

Microsoft Vista has improvedcapabilities for running on mobilecomputers.

Microsoft Exchange server will make iteasier for people to manage theirmessages, with e-mails, faxes, voicemessages and videos coming into a singlemailbox, which different devices canaccess.

Microsoft SharePoint Server 2007, partof Microsoft Office, has new tools to helppeople work together and put togetherworkflows.

Craig HodgesCraig Hodges is director of oil and gas withMicrosoft, based in Houston. He joined thecompany in January 2006.

He is responsible for development andexecution of Microsoft's oil and gasindustry strategy, solutions portfolio,business development and industryrelationships. This includes ensuringsatisfaction with all of Microsoft's productsand services.

He was previously regional salesmanager with Dell, with responsibility for global sales to major oil companies. He alsoheld a number of other roles at IBM,including vice president, sales, IndustrialSector - West Region, where he handledsales to oil and gas industry.

Before that he was general managerpetroleum for IBM, living in Singapore. Hedrove a change in IBM from country basedorganisations to a consultancy sales modelfocusing on different industries.

"We're dealing with a world today that has an explosion of data in a variety of formats - in a variety of locations.The big challenge facing our customerstoday is how do Imanage all of thatcapability together," says Craig Hodges

Microsoft Vista. How will it help

the oil and gas industry?

Craig Hodges, director of oil and gas with Microsoft

News update

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www.wavefield-inseis.com

Seismic service company Wavefield

Inseis has made an agreement with

Weatherford, to commercialise the

four component, four sensor, ocean

bottom, optical seismic device,

developed by Weatherford's

subsidiary Optoplan, working

together with Statoil. The technology has been fullytested over the past two yearsin installations off theNorwegian Coast, and provento have excellent performance,providing a very clear vectorpicture ('high vector fidelity'),Wavefield says.

Compared to othertechnologies, the opticalsystem can take more precisemeasurements, uses lesspower, is more reliable andcheaper, Wavefield says. Itbelieves many operators arewaiting for such a low cost,reliable system.

The first commercialinstallation of the technologyis expected in 2008.

The technology is thoughtto be particularly suitable for

www.welldynamics.com

WellDynamics, a Houston company

formed with a joint venture between

Halliburton Energy Services and Shell

Technology Ventures, has acquired

Halliburton's Reservoir Performance

Monitoring (RPM) business. The Reservoir PerformanceMonitoring business has fourcomponents; downholepermanent monitoring (viaoptical pressure sensors andpressure / temperature gauges);fibre optic monitoring oftemperature; multiphaseflowmeters; and associatedsoftware which manages andanalyses the data, includingflow simulation.

This acquisition followsWellDynamics acquisition inDec 2005 of the Wood Group'sproduction technologybusiness, a suite of permanentdownhole, subsea and surfacemonitoring products.

WellDynamics alsoannounced a partnership in

permanent seismic recording,so operators can understandhow the 3D reservoir picture ischanging over time (4D).

The device has threegeophones, recording soundwave velocity in all threedirections, and a hydrophone,to record changes in waterpressure. This is why it is called4C (four component).

As part of the agreementbetween Wavefield andWeatherford, Wavefield will buy35 per cent of Optoplan, withan option to purchase the restof the company when thecommercialisation period iscomplete.

Optoplan is based inTrondheim, North of Norway. Itpioneered the development ofdown-hole optical sensors inthe 1990s.

"We have now a solidfoothold in place for deliveringpermanent 4C4Dmulticomponent acquisition,using a technology that willbring the step change in costand performance that themarket has been waiting for,"says Wavefield.

Sept 2006 with Halliburton'sLandmark software, to worktogether on 'closed-loop'optimisation of wells,integrating Well Dynamics' wellmonitoring data withLandmark's productionreservoir modelling tool,DecisionSpace.

Altogether, Well Dynamics'strategy is to provide a full'closed loop' intelligent wellservice, incorporating puttingtogether 'intelligent' wells,incorporating sensors in thewells and datacommunications, which wouldfeed data into a reservoirmodel.

The reservoir model wouldwork out ways that theproduction could beoptimised, and changes couldbe made accordingly.

WellDynamics believes thatthe acquisition will help itserve existing customers andalso build up new customerslooking for well permanentmonitoring systems.

www.weatherford.com

Weatherford has completed what is

believed to be the first ever drilling

operation sending data to the

surface by electromagnetic pulses

through the mud, rather than mud

pressure pulses. A feasibility test for thetechnology was carried out forSaudi Aramco. Resisitivity,neutron and density data isbeing sent to the surface('triple-combo').

Saudi Aramco is planninggas injection on future wells,mixed with the drilling mud.Pressure pulses sent throughdrilling mud which contains gasdoes not work very well, so analternative communicationsmethod needed to be found.

This is because it wants todrill deeper wells inunderbalanced conditions (withthe drilling mud pressure lowerthan the pressure in thereservoir), so that the well isn't

WellDynamics acquires Halliburton'sReservoir performance monitoringbusiness

Wavefield Inseis to sell 4Cocean bottom technology

www.i-o.com

Seismic systems company Input

Output has launched its new Scorpion

system for land seismic acquisition.

Improvements have beenmade to the telemetryarchitecture, groundelectronics, central recorderand operating system software.

The new system is lighter,smaller, faster and uses lesspower, the company says. It hasa better user interface which arapid troubleshooting system.With the improvements, thesystem can handle morecomplex spreads and sweepmanagement systems.

Input / Output's new Scorpion seismicsystem

Weatherford - first electromagneticpulse LWD damaged by having high

pressure mud inside it.Sending data as a low

frequency electromagneticwave is also faster, because youdon't have to wait while the themud pumps are turned on andpressure is built up.

Sending data from thedrillbit is independent of theliquids in the wellbore, so thatreal time updates are possible.

Weatherford says that theproject represents a 'successfulproof of concept forelectromagnetic logging whiledrilling'.

The feasibility test wascarried out in a horizontalsection of well, of 6.125 inchdiameter, being drilled from8,100 feet to 11,189 feet in onerun, under underbalancedconditions.

The well was also flow andpressure tested, readingpressures in the annulus(between the drillbit tubing andwell wall), with the pumpsswitched off.

Together with the new release,Input Output has redesignedits training programs forcustomers and internal fieldsupport personnel.

It can be used with digitalVectorSeis recievers andconventional analoguereceivers.

The system is not wireless.It builds on Scorpion's SystemFour platform which has beenon the market since 2002, butwith improved recordingcapacity, reliability, productivityand ease of use.

The first customer isParagon Geophysical Services(Inc) of Wichita, Kansas, whichalso provided input into thedesign of the system.

Equipment news

www.tidelandsignal.ltd.uk

GUPCO (The Gulf of Suez PetroleumCompany) has signed a contract withTideland Signal to supply lanternsand a fog signal for its Gulf of SuezSaqqara platform. Tideland will supply theequipment on a skid, includingsolar panels, batteries,enclosures and a monitoring /

control system. The wholesystem will only need to beplugged in.

All of the equipment iscertified for use in a zone 1hazardous area.

The lantern being used, ML-300, has a range of 18 nauticalmiles, 19,800 candelabrightness, and 256 userselectable flashing codes.

Tideland lights on Suez platform

fuck.qxp 09/02/2007 20:25 Page 5

+1.703.444.2527www.wfnstrategies.com

Engineering of submarine and terrestrial optical cable, microwave/WiMax, mobile, satellite and RF systems for telecom, oil & gas and government clients


Equipment news

www.bhinet.com/inteq/BakerHughes INTEQ and Houstoncompany Knowledge Systems havelaunched the BEACON (Baker ExpertAdvisory Center / OperationsNetwork) Remote PressureManagement Service, for remotemonitoring of drilling. As part of the serviceKnowledge Systems engineerswill remotely monitor wellpressure and stability, whiledrilling is taking place. Theywill use the company'sDrillworks Predict application,to forecast pore pressures andimprove performance.

The well data is alsoanalysed by Inteq's datamonitoring and data

management engineers.Information about drilling istransferred out of the well viaBaker Hughes' RigLink system,to the BEACON centre.

The service can also becombined with INTEQ'slogging while drilling (LWD)tools, including its TesTrakservice for data aboutformation pressure whiledrilling.

The data can be used toupdate predictive models, andinterpret the formationpressure scenarios, getting amore detailed understandingof the pressures in the hole.

Three different tiers ofservice are being offered.

INTEQ and Knowledge Systems remotepressure monitoring

www.honeywell.comNorsk Hydro has bought Honeywell'sProduction Control Center (PCC)system, to install at its centralonshore support centre, whichremotely monitors its North Sea rigs,to help monitor production andoperations. The system will also be installedon its Njord platform.

The Production ControlCenter integrates differentbusiness applications into oneintegrated system. This means itcan monitor and optimise manydifferent pieces of equipment atonce, including turbines, safetyvalves and shutdown systems; itcan also provide a single screenoverview of everything which isgoing on.

Hydro buys Honeywell's ProductionControl Center

The solution also helps thecompany standardise andsimplify work processes.

The installation has beenmade following an initial trialon its Troll B platform. "Weconfirmed that we couldincrease operational efficiencyand reduce downtime bycombining vital rigmanagement and productionapplications into an automatedsystem," says Sverre Høysæter,discipline manager at NorskHydro.

"Honeywell's solution allowsus to monitor separate processfunctions simultaneously,alerting us to potential issuesso they can be dealt withquickly and accurately."

www.roxar.comRoxar has won a 'multi-million dollar' contract

to supply 19 multiphase meters

to ExxonMobil's deepwater Kizomba C

development in offshore Angola. The meters will be installed inExxonMobil's Mondo and Saxi/Batuquefields, operated by its subsidiary EssoExploration Angola (Block 15) Ltd.The immediate contractor is Vetco Gray.

The field is 370km West of Luanda,Angola, in 740m of water.

The Kizomba project is the largestdeepwater development in offshoreWest Africa.

The contract follows Roxar installingmeters for ExxonMobil in Kizomba Bfield, which went into production in 2005.

The meters continuously monitor theamount of oil, condensate, gas and wateron the wellheads on the sea bed.

ExxonMobil will use the informationfrom the meters to help identify theoptimum production capacity of thewell, reducing the risk of damage due tooverprodduction. It will also be able toconduct quicker well tests.

Roxar says that ExxonMobil chose itsmeters on the basis of their accuracy,continuous monitoring, light weight(1500 pounds / 680kg), and having theelectronics and computing modules in aretrievable canister.

The meters can be installed and maintained using a remotelyoperated underwater vehicle, with no impact on production, and no needfor test lines and manifolds.

The meter is independent ofseparation efficiency and insensitive toslugs, foam, carry-overs and emulsions.

receive the latest newsand featurearticles in your inboxevery Thursday

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Roxar multiphasemeters forExxonMobil Angola

fuck.qxp 09/02/2007 20:25 Page 6


Communication news

www.caprock.com

Oil and gas satcom company CapRock

has upgraded its network operations

centre (NOC) in Aberdeen, Scotland,

so it can provide better service

to its customers in Europe, Middle

East and Africa. At the centre, Caprockmonitors its customers'satellite communications andequipment, to checkeverything is working properly.

The centre is also connectedby fibre optic to Caprock's centre in Houston.

An opening ceremony washeld on Jan 26th, with tours ofthe building and teleport,followed by a Burns' supper.

www.halliburton.com/sperry-suSperry Drilling Services has tested itsINSITE logging while drilling servicetogether with Grant Prideco'sIntelliServ drill communicationsnetwork, as a way of transmittingdata from the drillbit to the surfacefaster than was previously possible. Using the two tools together, itis possible to transmit highresolution images of thesubsurface.

Sperry also sees thedeployment as part of itsparent company Halliburton'sstrategy to enable customersto model, measure and

www.nesscoinvsat.com

Aberdeen satcom companyNesscoInvsat has won a contract to supply a 2.4m C band satellite communications antenna and associated equipment for the Floating, Production, Storage and Offloading (FPSO) vessel BW Peace. The vessel, operated byNorwegian BW Group, is currently named BWEndeavor, but will berenamed BW Peace followinga refit.

It will be used by PeakPetroleum Industries Nigeriaand Equator Exploration Ltdin the Bilabri Field, offshoreNigeria, from the second quarter of this year.

The satellite connectivityand associated equipmentwill be provided byTeleconsult A/S of Norway.

NesscoInvsat satcoms to Nigeria FPSO

www.microwavedata.com GE Industrial (part of GeneralElectric) has acquired MicrowaveData Systems, a company which provides microwave data communications to the oil and gas industry (among other sectors). Microwave Data Systems waspreviously a subsidary ofwireless data communicationscompany Moseley Associates.

It will now be renamed GEMDS, and be run by RobertoVengoechea, currently generalmanager of Multin'sInstrument TransformerBusiness.

GE made the acquisitionbecause it thinks MicrowaveData Systems' technology willbe a good complement to itsMultilin business, whichprovides metering, control andautomation systems,transformers and telecomnetworks to various industrysectors.

Microwave Data Systemsemploys around 275 people,who design and manufacturehigh speed networkedmicrowave radios, for use in oiland gas, utility, trafficmonitoring, public safety,lottery and other industrialapplications.

"MDS is a highly technicaland innovation-basedenterprise with a stream ofnew products planned forlaunch in '07 and beyond. Thisis exactly the type of businesswe want in our portfolio," saysGE Multilin.

www.alcatel-lucent.comFrench communications companyAlcatel-Lucent has been selected bythe Norwegian Oil IndustryAssociation OLF to carry out a WiMAXpilot in the North Sea, to find outhow well it works on oilrigs andships. High power base stations willbe installed on one of theplatforms on BP Norway'sValhall field, and two vesselswill be equipped with terminalequipment.

OLF wants to find ways toimprove communicationsbetween platforms and vessels,in different weather conditions.

The system will be deployedin the first quarter of 2007, and

GE Industrial toacquire MicrowaveData Systems

www.tyco.comBP America's long awaited contract for a fibre optic system in the Gulf ofMexico has gone to TycoTelecommunications. Tyco will construct and installthe 1400km undersea fibre opticsystem, connecting BP's offshoreproduction facilities to itsregional operating centre inHouston.

The system is expected to bedelivered to BP in mid 2007.BP will lease spare capacity onthe system to other oil and gascompanies.

The cable had been indiscussion for several years.Tyco will manufacture the mostimportant elements

Gulf of Mexico fibrecontract goes to Tyco

of the system at its plants inNewington (New Hampshire)and Lowell (Massachussetts).The undersea plant will beinstalled by Tyco Decisive, a140m cable laying vessel basedin Baltimore, Maryland.

The cable will initiallyconnect seven deepwaterproduction platforms, with thecable coming ashore in landingstations at Freeport (Texas) andPascagoula (Mississipi). It willcost an estimated $80m.

To ensure reliability, eachplatform will be served by abranch cable from a deepwater trunk, so thatcommunications will not be cutif anything happens on one ofthe rigs.

This means that if the cableis ever cut, each rig will still beable to reach at least one of thelanding stations.

Alcatel North SeaWiMAX pilot

Faster data from the drillbit with Sperry + Prideco

optimise asset performancewhile the drilling is takingplace.

The IntelliServ network canbe used for sending commandsfrom the surface or betweendownhole devices, and formonitoring and measuringdownhole operations, at speedsup up to 1 megabit per second.

"Today, drilling rates can belimited by the transmissionspeed of high volume datacollected during the drillingand evaluation process," saysSperry. "With the SperryIntelliServ solution, thislimitation is eliminated."

will last for nine months.The standard to be tested is

WiMAX IEEE 802.16e-2005.Alcatel-Lucent will provide itsLucent 9100 solution, includingbase stations.

WiMAX antennas - Alcatel-Lucent isinvolved in a WiMAX trial in the North Sea

CapRock upgradesAberdeen operations centre

CapRock's Aberdeen network operations

centre

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Communications

Automation giant Honeywell hasdeveloped a new wireless datacommunications networkstandard, a self-healing, self-

propagating network, which it is very keenon promoting as part of a forthcomingInstrumentation, Systems and AutomationSociety (ISA) SP100 standard.

Both Honeywell and its main competitorin the process automation market,Emerson, are pushing for their own versionto be included in the SP100 standard.

Both are currently offering solutions tothe market, and pledge to migratecustomers to the new standard wheneverit is decided, probably some time in 2008.

It is not hard to see why Honeywell isexcited about the prospects for wireless. Itcan already claim some success in themarket, with installations of the XYR 5000wireless transmitter at more than 300customer sites since its introduction in2004, and growth in sales of 110 per centeach year.

The technology promises to open up arange of applications where cabling iseither difficult to install, such as on a rig, orprohibitively expensive compared to thebenefits.

It also offers the key advantage ofintegration of multiple devices, such assensors, mobilePCs and securitysystems.

Mesh networksuse a self-propagating, self-healing networkof nodes toachieve blanketcoverage of anarea. Each nodecan communicatewith any othernode, so that ifone goes downthe network canre-route data andconnectivity is notlost.

Honeywell'snetwork isscalable, up to30,000 nodes, hasbuilt in industrialsecurity and is fastwith low latencyto enable controlapplications.

and may lead to network instability.The need to more frequently replace

batteries, Honeywell argues, negates someof the major benefits of wireless: lowermaintenance costs and the possibility ofimproving health and safety by havingfewer engineers in the field.

The Honeywell approach is to use apowered network of 'inodes' thatcommunicate with the battery poweredwireless sensors, and route all networktraffic.

The inodes would ideally be elevatedand have an optimum displacement of300m for non line of sight communication.

Of course, the need to run power cablesto each inode does in some ways negatethe whole wireless concept.

Honeywell argues that the nodes wouldbe installed in areas where power wasalready available and anyway companieswould still save on cabling costs.

However in more remote locations theidea of a battery powered network thatextends itself through its sensors withoutpower lines does have a certain appeal,even if battery replacement would beexpensive.

Honeywell was keen to emphasise thedifference between its offering and that ofits main competitors. According to thecompany, "battery life is the elephant inthe room," meaning that it is reliability andpredictability of the sensors and nodes inthe network that is the issue.

The key difference is that the Honeywellnetwork does not use its sensors to passon network traffic. This means that thebattery on a sensor is only used when thatsensor is transmitting information and notfor anything else. Therefore the battery lifecan be predicted with some accuracydepending on the frequency of use andthe ambient temperature conditions.

Other wireless mesh networks, includingthat of Emerson (Digital Energy Journallearned at a recent Honeywell userconference), use the sensors as nodes inthe network.

Honeywell say they tried this approachbut abandoned it because of theunpredictability of the network trafficfrequency, and therefore the battery life, ateach sensor node, particularly as thenetwork size grows. This will causeunpredictable performance of the devices

Honeywell's wireless data standardAutomation giant Honeywell has developed a new self-healing wireless data networking standard,and is competing against Emerson for it to become a new international standard

Honeywell believes its self-healing wireless networkstandard will be very useful in oil and gas installations

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Communications

Network architectureThe Honeywell network architecture wasdesigned from the beginning to enablecontrol applications, not just dataacquisition and sensing.

"We feel that if something is not readyto be used in control it isn't ready forsensing," said Paul Orzeske, Honeywell'svice president and general manager forEMEA.

This means that the network has latencycontrol and redundancy built in, making itsafe and reliable for critical controlsolutions. It also means sensor frequenciescan be up to one measurement persecond, while Honeywell claims itscompetitors have sensor frequencies of'around 5 minutes at best'.

While Honeywell is pioneering anapproach that integrates multiple wirelessprotocols into a single network, the realityis that in many applications severaldifferent networks from different vendorsmust co-exist in the same space.

This places demands on interoperabilityof networks, all of which must share thesame media for propagation andpotentially share frequencies as well.

The technologies are evolving rapidlyand it is not possible for the standardsbodies to incorporate proprietaryprotocols quickly enough to ensure all willoperate together; in fact by the time thestandards are fixed the technology willprobably have evolved, maybe toconvergent devices that can use a range ofdifferent networks depending on the usescenario.

Trends in the consumer market towardconvergence will impact industrial systems.For example, mobile (cellular) devices thatcan also use a local private network tomake calls over the internet when the useris in range will offer companies costsavings by reducing expensive mobilecalls.

It is likely that future devices willautomatically roam over the availablenetworks, using which ever system orprotocol is the most suitable and leastexpensive.

SecurityOne of the major concerns with wirelessinfrastructure is security of the network.

All the protocols used in consumerapplications, such as WEP and WPA used indomestic broadband 802.11b/g networks,have already been shown to be not secure.

Honeywell has partnered with 3eTechnologies International, a provider ofindustrial IT infrastructure securitysolutions used in government and militaryapplications. It has developed the first (andso far the only) Common Criteria ValidatedWLAN Infrastructure and client products.

The Common Criteria describes aframework in which computer systemusers can specify their securityrequirements, vendors can then implementand/or make claims about the securityattributes of their products and testinglaboratories can evaluate the products todetermine if they actually meet the claims.

Common Criteria provides assurancethat the process of specification,implementation and evaluation of acomputer security product has beenconducted in a rigorous and standardmanner.

Security covers several aspects,including eavesdropping on networktraffic, unauthorized access or denial ofservice attacks, where a hacker jams thenetwork with interference to slow it downpast acceptable levels of performance.

Industrial solutions now exist to addressall these issues, and indeed in many casesthe wireless network will be more securethan the existing Ethernet cabled networksit is connected to, due to improvements insecurity standards and understanding.

Many existing wired networks alreadyhave important vulnerabilities due tomisconfiguration of firewalls and othersecurity options.

The Honeywell network uses the sameproven security that has been tested forseveral years as part of its Experian PKS(Process Knowledge System) platform forcollecting, integrating and analyzingbusiness and process knowledge frommultiple sources.

The company is relying on this trackrecord to reassure customers that itswireless offering is a safe technology.

Mobile dataHoneywell's solution for wireless field datacollection is called IntelaTrac PKS, whichuses hand-held devices to enableoperators to take measurements in thefield and have that data electronicallydownloaded to reliability, engineering, andequipment databases.

The company claims IntelaTrac is thefirst system on the market to integrate fielddata with data from other sources,

including production, process control, andwork management systems, allowingoperator rounds to be automated andproblems more quickly identified.

Another interesting innovation indevelopment is the real time locationsystem (RTLS) that tracks physical objectssuch as mobile equipment and employees.This cuts down on the cost of findingequipment and personnel, but can also beused for a wider range of security andsafety applications.

Using a three dimensional view of thefacility, assets can be monitored andinformation pulled up on the screen aboutan individual operator to check what theyare doing.

Integrating positioning informationwith other process variables using theExperion PKS platform, it is possible tomonitor not only where a person is, butalso to raise an alarm if they are not wherethey are supposed to be. Threedimensional areas can be designated foraccess only by operators with the rightsafety certificates for instance, and ifanyone else strays into the region thealarm can trigger a range of responses,such as shutting down the processes in thearea in extreme cases.

The system can also be used as asecurity tool, and is compatible withHoneywell's security card access system;visitors to the site can be tracked and asthey move through the facility and warnedif they enter an unauthorised area.

Adapting to changeHoneywell announced an ambitious planfor 'double digit' growth in the EMEA(Europe, Middle East and Africa) region andat its user group meeting in Seville lastNovember.

Paul Orzeske, Honeywell's vice presidentand general manager for EMEA, talkedabout 'adapting to change', as the focusand theme of this year's conference.

As well as tackling new and increasingthreats such as cyber security andterrorism, this means looking at widerproblems in the industry such as thegrowing shortage of engineers and waysof improving knowledge retention throughinformation systems.

He also talked about the demand fromcustomers to be able to 'do more with less',completing projects with less personneland less resources and operating them ona tighter budget.

All this means more automation andmore need for data collection systems thatmonitor every aspect of a project andallows managers to see where savings canbe made.

Honeywell will also focus on increasingits customer service offering, opening newoffices and expanding existing ones in theregion, and building relationships withrepresentatives who speak the locallanguage.

“Battery life can be predicted with someaccuracy because the network does not useits sensors to pass on network traffic.”

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Cracking information management -Flare Solutions

There have been many attempts atinformation management in theoil and gas industry, but perhapsnone have got so close to getting

it right as Flare Solutions, with its webbased information cataloguing tool, E&PCatalog.

Shell International Exploration &Production started deploying the system in2004, as part of a bid to try to reduce theamount of time users spent looking forinformation by 50 per cent.

Shell now has 1.5 million documentsand other items catalogued in its system,and it has been used by over 3,500 staffmembers, achieving significant reductionsin staff search time.

Flare is now rolling out EP Catalogacross the whole of Shell E&P, workingtogether with IBM Global Business Services,targeting exploration and developmentengineering staff.

In December 2006, Flare and Shell wonthe British Computer Society (BCS)European 2006 Knowledge ManagementProject Award, for the system deployment.

Flare and Shell were also highlycommended for the intranet project award,and the content management projectaward.

Flare also plans to release aspects of itsdata structure during 2007, under thecustodianship of Energistics, so that thewhole industry can benefit from it.

E&P Catalog has already been integratedwith a number of different systems,including Schlumberger DecisionPoint andLandmark TeamWorkSpace. Also the GISbased graphical systems ESRI andMetaCarta; the user can choose whichassets they are looking up on a map, andthen dig out the relevant documents usingE&P Catalog

Other integrations include EDMS'LiveLink document management software,and soon Enigma's PARS archiving system,and PetrisWINDS Enterprise includingRecall.

CatalogueThe system builds a catalogue of acompany's documents, archives and chunksof data. Flare treats them all as documents.Information catalogued includes reports,logs, reservoir models, project archives;databases, information about differentpeople; even physical items such as cores.

The documents are not held in anycentral location, but can be storedanywhere in the company (so long as theyare accessible over the network).

Critically, adopting E&P Catalog does notrequire that a company change anythingabout the way they store and manage

access to documents; they can still be keptin different data stores around thecompany, with different access rights set todifferent documents. But the tool makesthe documents easier to find.

The catalogue holds information aboutthe documents, for example which well,field, survey or license they refer to, whowrote it, what it is and what it is about.

The right touchThe trick to getting informationmanagement right is getting the touchright, Flare believes.

Too many information managementprojects have failed, because they tried tomodel work processes too minutely, endedup telling employees to do things theydidn't want to do, or ended up being toocomplex and creating too much work.

Projects have failed because they triedtoo hard to index more information thanwas necessary, they treated data anddocuments differently, they were beingpushed by the company IT department notsenior management, they needed lots ofmaintenance and classroom training forend users. Projects have failed because theyended up as 'Wiki/Discussion' type systemswith no mechanism to differentiatebetween chat and important companyinformation.

Flare skirts around these problems inmany clever ways.

People carry on creating and retrievingdocuments much the same way as theyalways have done, but when they decide adocument is good enough for the rest ofthe company to see it or know it exists,they type in indexing data telling the

catalogue what the document is all about,essentially publishing the document to therest of the company.

The system does not try to index andcatalogue every single byte of data in thecompany, but just documents and chunksof data considered important enough thatpeople will want to refer to them in thefuture. This massively reduces the indexingworkload.

The quality of all the data can berecorded in the catalogue, so for example auser can tell if it is a final depth map whichmany people in the company worked onand approved, or something a geologistput together in an afternoon.

The 'workflow' to create and retrievedocuments is kept as simple and light aspossible, following processes and creatingdocuments which every oil and gascompany follows, rather than creating newprocesses.

Flare makes sure the project is driven bysomeone senior in the company, not by ajunior IT manager.

Search processYou can search for documents in the EPCatalog web interface using four mainmethods from the catalogue web interface.

Firstly, you can search by a word, similarto with Google, except that instead ofgetting your results in a list, you get yourresults in a table, so you can drill down andget the information you really want.

Secondly, for high precision searches,you can select values in drop down menubars and lists, and quickly find exactly whatyou are looking for.

UK / North American information management company Flare Solutions might have got closer tocracking the oil and gas information management challenge than any service company we have seen

Flare Solutions and Shell receive the British ComputerSociety European 2006 Knowledge Management Award.From left to right Roger Abel of Shell; Graeme Burton of Inside Knowledge Magazine; and Paul Cleverleyof Flare

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You can search for information gearedaround products (data, interpretations,reports); processes (activities, procedures,standards); people (personnel,organisations); tools (technology,applications).

A typical search could be - start with thespecific asset (well, field or survey), look fora context (eg 'geology' or 'core' or'operations report' or 'palynology'), thenget the results.

Thirdly you can find documents viahyperlinks with related documents.

Fourthly you can set up your ownsearches, for example to always retrieve aspecific set of documents for a well.

The system has a knowledge map ofwhat is related to what.

For example if they type 'oil shale Russia'in the search box, you might getdocuments about the Bazhenovkaformation, because the computerunderstands that this is an oil shale inSiberia.

Content can also be found (whererelevant) via map interfaces.

All of the documents are served up fullylabelled. So for example, if a user haslooked for all of the documents for aspecific survey, they can immediately awarewhich documents represent the finaloutputs and which is intermediary work.

You can see which documents havebeen approved and by who, and you cansee the associated maps, and documentswhich were used to derive the conclusions,such as geological models, seismicinterpretation, reservoir models andeconomic models.

People also use the tool to search theirown project information, as differentpeople get involved with it, as it passesthrough the different stages of exploration,appraisal, development, projects andoperations.

PublishingThe other side of the coin is 'publishing',when employees decide their work is readyto share with the rest of the company, andwant to publish it in the catalogue, andindex it accordingly.

The document at this stage must belocated in a secure repository which isaccessible through the corporate network.

Documents can bepublished and indexedby the individual user, orthe software application it is in could be made to do the publishing.

If the documents are already indexed in a certain softwarepackage, then E&PCatalog can be inte-grated with that.

This is the list of some of the tags given to documents:

- bibliographic (title, description, author,owner, reference, language, sourceorganisation, cross references, publishingdate)- document control information (owner,who approved it, how it will be retainedrecords management codes, the securityissues, if it is published, who reviewed it,revision number).- context (asset it is linked to, product type(e.g. field development plan), discliplinesuch as geological / geophysical, productgroup, subject matter (e.g. Roll-overanticline) )- usage (where the document is, whatmedia it is on, the data format, URL deeplinkto corporate database, external database)

Doing the indexing workThe first hurdle which many similar projectsstumble at is the work of indexing all of thedocuments. This task can be done by theexisting corporate library department, adedicated indexing team, or the staff whocreate the documents can do their ownindexing.

By employing dedicated cataloguerswho work directly with the project teams,you can index about ten times moredocuments than typically ever make it tocentral libraries.

Most staff are happy to put a smallamount of additional effort intocataloguing their own content, becausethey understand from their own experiencehow hard it can be to find the rightdocuments. They also want to ensure thatother people can quickly find and benefitfrom their work, particularly if another teamtakes over on the project at some point infuture.

It is possible to automatically classifycertain documents, using a special toolwhich makes a best guess at adding aproduct type classification, discipline,subject domain matter and assetinformation. This can work for about 80 percent of documents, Flare says.

Documents can be sent and cataloguedautomatically through web services / feeds.

For example, there are sources of 'scout'information (information about what otheroil and gas companies are up to) sent byvarious agencies such as Deloitte, which oil

companies can buy. This data is sent as aweb service, and is immediately integratedinto the Catalog, so it is automaticallyavailable together with other external andinternal company information.

In the same way, information acquiredfrom operations such as well drilling andreservoir management can be self-classifying using web services and thecorrect tags in the XML files so they appearin the catalogue in real time, differentiatinginterim and definitive final documents. Thiscuts the whole process of manual indexingout.

Work processesThe company has also built workflowengines around its catalogue, whichprovide people automatically with thedocuments they need for a particularroutine.

This is being used by one company totrack the deliverables from its Top 70 fielddevelopment projects around the world,by another to track well drilling and dataacquisition.

There are process steps, with templatesfor putting in documents, input documentsavailable and required outputs. Graphicalviews show multiple project and processviews .

There are templates for searches, forexample one which can bring up availabletechnologies and techniques which shouldbe considered at particular business stages.

The trick, says Paul Cleverley, director ofFlare Solutions, is to build systems at theright level, closely following the kind of 'big picture' work processes which every oilcompany does, the big milestones and'baton changes,' not trying to get intopeople's work too closely.Common workflows include: Prospect generation (seismic dataacquisition, processing, interpreting,modelling);

Optimising drilling (well planning, well engineering, drilling,operations monitoring, reporting);

Field development planning (modelbuilding, well planning, facilities modelling,simulation);

And real time field operations (field datacapture, surveillance, intervention).

Tasks which nearly all oil companieshave include project framing sessions, peerreviews, integrated reviews, value assurancereviews, decision review boards to releasefunds for the next phase, after actionreview to capture learning. There aredocuments which need to be created andsubmitted at all of these stages, as well asthe well, investment proposals, maps, fielddevelopment plans.

The system does not try to tell peoplehow they should undergo a complexworking activity, such as interpretingseismic data, but tracks what they havedone and stores their interpretations forfuture use.

At a later stage, it is possible to drawcharts, showing how long different stagestook, what the hold-ups were, what the costof them was, helping keep the overallprocess efficient. www.flare-solutions.com

Screenshot from Flare Solutions EPCatalog - essentially, asophisticatedindexing of an entire company'sdocuments

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Software

By running several reservoir modelsrather than one, you can get abetter model faster (whichmatches as closely as possible the

reservoir production history), and also havea better feel for how good your model is, bylooking at the range of different resultswhich are generated.

If multiple matched models clustertightly together it indicates that the field iswell understood given the uncertaintiesyou have defined for the field.

Of course, you can run several modelsusing standard software, but it can get a bittedious, so why not use MEPO to organisethe process for you. Scandpower estimatesthat its software will take 50 - 80 per cent ofthe time taken to do it manually.

Running several models can use a lotmore computer processing power, so MEPOuses tools which maximises the utilisationof the available computers, for examplerunning models on people's desktopcomputers overnight, and queuing jobs sothat as soon as one simulation has finished,another one can start.

MEPO version 3 has an improved userinterface. It has sensitivity analysis tools,enabling engineers to determine whichfactors have the biggest impact on theaccuracy of the reservoir model (assessedby comparing the model with the actualproduction history). Version 3 also runs onWindows XP (in addition to Linux).

Other enhancements include additionalexperimental design methods, improvedqualification of match quality, the ability tooptimise using response surfaces, clusteranalysis to automatically identifyalternative matches, and improvedmonitoring of ongoing runs.

MEPO is not a reservoir modellingsoftware itself, but it sits on top of othermodelling software, such as Eclipse andIMEX. It can work with all commercialmodelling tools and a number ofproprietary ones.

Companies already using MEPO includeChevron, ENI, TNK-BP, PetroCanada, Statoil,BG, Dong, Hess, PA Resources, RWE-DEA,Total.

It is not hard to see the benefits ofknowing how good your model is, if youare going to make multimillion dollarinvestment decisions, such as decidingwhere to drill, based on it.

Multiple modelsThe basic logic is - using the ReservoirEngineer to define the strategy and MEPOto launch, analyse and improve multiplemodels the more likely you are to come up

with a good one, and the better idea youhave of how good the model is.

One of the problems which oil and gascompanies have is making just one modelwhich looks right, assuming it is 100 percent accurate, and making high valuedecisions based on it, rather than keepingtrack of the level of uncertainty in it.

Scandpower is very keen on a quotefrom the Financial Times, which says "Thefinancial industry has found that the morefinely tuned a model, the morecatastrophically it tends to fail when theworld moves outside the parameters forwhich it was designed."

There is a large amount of uncertaintyinvolved in all stages of a reservoir model,but it is very difficult to track theuncertainty, so it is hard to work out thelevel of uncertainty in the final result.

Different reservoir models are normallyassessed by seeing how well theircalculations of the flow in the past matcheswhat the well actually produced ('historymatching').

While this is a useful way of assessingreservoir models, it does not necessarilymean the model accurately describes thesubsurface, because there can be manydifferent possible reservoir models whichall match the available data and all historymatch.

For example, engineers will sometimestweak the input data (for example,multiplying their porosity figures by acertain multiplier) until the model matchesthe actual production history; this is aprocess which will lead to a model whichmatches the actual production history, butdoes not guarantee a model whichaccurately describes the subsurface orfuture production.

The MEPO software can come up withmany models, which all history match, butare all slightly or fundamentally different.By examining how much they differ, youget a sense of how accurate each one ofthem is.

A further example of MEPO is that youhave an audit trail of everything that wasdone to the data since it was input; withconventional simulations, engineers canmake endless tweaks and changes to thedata until it matches the history, withoutnecessarily keeping a record of who didwhat or why.

"My prediction is over the next 18months this type of workflow will becomethe standard industry practice," says DrMark Brownless, manager of MEPO UK.

www.mepo.com

Scandpower launches MEPO 3Scandpower Petroleum Technology of Norway has launched version 3of MEPO, its tool to manage the process of creating computerreservoir models.

Just because a model historymatches, doesn't mean itsprediction is correct. Theanswer is to make severalmodels which all historymatch, then look at the rangeof the predictions.(above)

Testing out three possiblelocations for an infill well. Bymaking a single manuallymatched model, all locationslook equally good; but bymaking a range of modelswhich all match, it can beclearly seen that the secondchoice is the best. (below)

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Software

Statoil signs to Platform's ‘grid’ computing

Statoil has signed up to use softwarefrom Platform Computing whichwill move big computer processingtasks (such as processing reservoir

models) around the company to whichevercomputer is most suited to doing it.

Instead of doing the job in a computercentre, it can be done on powerfulcomputers which engineers have runningon their desks, when they have spareprocessing capacity.

The contract covers Statoil's facilities inNorway, Houston, London and other futureexploration offices, which are all networkedand linked by leased fibre optic cable, andwill be extended to a further six sitesshortly.

Altogether it covers 1000 computerprocessors, which can run thousands ofjobs simultaneously.

Statoil wanted the system to be able torun 20 different software applications. Itfound that four of the 20 worked straightaway, the rest needed a small amount ofintegration work, taking between a fewhours and a few days for each integration.

The system is being used by over 2,000companies, including Shell, Nexen,Marathon Oil, ConocoPhillips, Total, AgipPetroleum, BG, Kuwait Oil Company (KOC),and Abu Dhabi Company for Onshore OilOperations (ADCO).

Platform is the certified solution forSchlumberger's Eclipse, and will shortly becertified for Schlumberger's Petrel. In factSchlumberger Information Solutions acts asan unofficial reseller.

It is still necessary to have a softwarelicense on each individual computer beingused - so for example a Landmark Graphicsprocessing job could only be run on acomputer with a Landmark license.

BenefitsThe benefits of doing computer processingjobs on the computers you already haveare fairly obvious. The company can makemuch better use of its IT resources, andsave energy.

It reduces the amount of investment itneeds to make in expensive highperformance computers and server farms,which most oil and gas companies arecurrently investing large amounts ofmoney in.

By making computing power moreaccessible, it is easier to run the data moretimes, so there is more chance of ending upwith the right model.

"Companies have more computer poweron people's desks than in their processing

centre," says Terry Suckling, SystemsEngineer, Oil and Gas at PlatformComputing. "What we used to run thecorporation on is now in the desktop.

"It is not unusual for a PC to have 2 GBof memory and 2 separate processors."

"In the PC world, everything is dual core.Many PCs are multicore and you only useone."

Users of individual desktop computerswill not normally be aware that theircomputer is being used for someone else'sprocessing job.

Many companies overestimate howmuch their computing resources are beingutilised, thinking they are being utilisedaround 90 per cent, when they are actuallyonly 20-30 per cent utilised, he says.

All of a sudden, engineers find that theyhave thousands of CPUs at their disposal,instead of just whatever they have in theirown offices.

Some engineers are understandablyreluctant to allow other people's jobs to berun on their own computers, but Platformpoints out that it should not make theirown jobs go any slower, and in any case,their computers are a company asset, not apersonal asset.

The Platform Computing software will

provide information about the processingjob and how the network is workingtogether, for example how many retrieshave been necessary to do a job on aparticular computer.

Companies can understand which oftheir hardware is performing the best.

The software can also give warningswhen their computer clusters get too busy.

The software can split one processingjob into many different slots. If onecomputer is switched off or loses power,the job can automatically be picked up onanother computer without any loss of data.Also, if a more powerful computer becomesavailable than the one running a specificjob, that job can be moved to the bettercomputer.

There is a web portal which you canreach from any machine, and see how thecluster system is working.

Different jobs can be given differentpriorities, so a group with a higher prioritycan be processed first.

The next development will bevirtualisation, enabling Platform forexample to run Linux software on a PCrunning Windows, by building a Linuxworkstation within the PC.

www.platform.com

Instead of doing your computer processing in a server farm...

"Many companiesoverestimate how much theircomputingresources arebeing utilised,thinking they arebeing utilisedaround 90 percent, when theyare actually only20-30 per centutilised."

Statoil has signed up to use Platform Computing's grid technology solution, which moves big computerprocessing jobs to desktop computers around the company, rather than in a central processing centre

why not do it on your office PCs, when they aren't being used?

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Software

AUK oil company, described asbeing in the FTSE 100, asked UKsoftware house / design agencyPrime Design for assistance

putting together a license application withthe UK government, so that it was easy toread and consistent.

After submitting the application, thecompany went on to win 80 per cent of thelicenses it applied for, after expecting towin just 50 per cent; doing the same thinga second time, it won 90 per cent of thelicenses it applied for. There was feedbackfrom the authorities that the design went along way to achieving those success levels.

Prime Design has an interestingbusiness model, designing companyintranets, and even technical documents(such as licensing applications), so that theylook appealing.

Clients include BP, Shell, NexenPetroleum, Hess Corporation, Petro-Canada,Petros Geoscience, Ikon Energy.

Prime Design has two directors and acompany secretary, with a further 7consultants working part time. Ken Clark,one of the directors, was previously groupdesign manager at Enterprise Oil. The otherdirector is Mac McEldon, who waspreviously a software developer outsidethe oil and gas industry until 2002.

License applicationThe license application the oil companysubmitted was very large, running toseveral volumes, including informationfrom many corners of the company.

The oil company decided that there wasno need to submit a boring lookingdocument, as companies normally do inthis circumstance.

The logic being - why should UKgovernment staff, who have to evaluate theproposal, look at boring lookingdocuments at work, and see well designedmagazines when they get home?

Prime Design managed the process ofputting the license application together,including taking images (in varying qualityand differing formats) from all areas of thecompany, as well as scanned documents,spreadsheets and word documents, andmanaging last minute changes fromdifferent departments up to the lastminute.

The final result had a consistent layoutand page design, and was clear and easy toread.

To undertake the project, Prime Designneeded to assess whether or not it neededsome kind of direct access to thecompany's IT system (and how to achieveit); also how to make sure it would use the

same naming systems the oil company uses,and fit in with its brand guidelines.

Prime Design was not allowed to interfacedirectly with the oil company's IT network forsecurity reasons, but it managed to linkcollaborate using a wireless peer to peernetwork.

The staff worked at the company's site,using Adobe Creative Suite 2, Adobe Bridgeand Version Cue. The software hadfunctionality to enable people in thecompany to get involved in producing theapplication, but with a version control policyin place, keeping a check on who wasmaking which changes.

The company worked with experts acrossthe company to determine the best possibledesign, including geologists, geophysicists,lawyers and draughtsmen.

Making text clearerAs well as focussing on the design aspects,Prime Design provides advice andsuggestions about the clarity of the text, so itis easier to grasp the important points, andeasier to understand and assimilate the fulltext.

A common trick is to put the key points ina page down the left hand margin, so theycan be quickly grasped and scanned.

Another trick is to put particularlycomplex material into footnotes, rather thanthe main text, so it is available for anyonewho wants it, but does not interrupt the flowof reading for people who do not have timeto understand the complex material.

Prime Design writes section headers,which precis what is in the section, so peoplecan decide whether to read it or not, and canprepare themselves to get into the subject inmore depth.

Corporate intranetIn another project, Prime Design was askedby a 'New York Stock Exchange listed' oilcompany to improve its corporate intranet.

The problems with the company'sprevious intranet included inconsistencybetween pages, out of date content, nosystem to control changes, and drawn-outmanual processes to update the site.

The large amount of out of date contenton the site in particular was proving a barrierto usage of the system by staff. There was nosystem for users to signal content thatneeded review.

The intranet had just flat HTML pages,with one member of staff managing all theupdates manually.

Content was being received in all kinds ofdifferent formats (Excel, Word, andPowerPoint) and had to be transferred toHTML, which was proving very timeintensive.

There was also no interface between theintranet and other business applications.

Prime Design's objective was to build asite which would make it easy to accessinformation, and encourage different peopleto get involved in supplying (and owning)content, with the system integrated as muchas possible with existing company processes,and would also support the company brand.It wanted to make sure the intranet wasrobust, secure, scaleable and easy to use.

Prime Design also wanted an intranetwhich staff would actually want to contributeto and use.

Prime Design started with an onlinecustomer survey to find out about userrequirements for the site, asking about howimportant different features were and askingfor suggestions about content.

A prototype intranet was built andreleased to selected members of the clientproject team, to get feedback on the look /feel of the site, and functionality.

The prototype was then deployed, usingan open source content management systemMambo CMS. It was hosted by Prime Design,accessible with a web address and username/ password.

For the actual intranet, Prime Designchose a product called Livelink WCM, built bya company called Opentext. Other softwarewas evaluated.

Livelink WCM has functionality fordepartments to publish their own content,but keep the look and feel of the siteconsistent. The content storage database isall in one place.

All content is given 'go live', 'review' and'expiration' dates, so the site is always up todate.

The design has a 'simple but practical'three columns, with a variable width, tomaximise use of the screen.

Corporate colours were adhered tothroughout, but corporate branding was keptto a minimum.

All content has to be approved bysomeone before going live on the internet,with supervisors appointed in eachdepartment. The software has functionalityto manage the workflow, alerting supervisorswhen there is content which needs approval,and automatically publishing it if it isapproved, or submitting feedback / requeststo the authors if not.

The core intranet was built quickly byPrime Design and tested fully before beingmade available to the company.

Prime Design then put the content fromthe prototype and interim intranet onto thetest system, set up content groups, systemusers and processes onto the workflowengine.

The system was run offline for a while, sousers could start to input content and usethe system, while there previous intranet wasstill active.

Three day courses were held for systemadministrators.

Good design wins licensesAn (undisclosed) oil company won 80 per cent of licenses applied forwith the UK government, expecting to win just 50 per cent, andpartly attributes a well designed application by Prime Design to itssuccess.

Real Time-3548W.indd 1 26/1/07 4:03:54 PM

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John WoodManaging Director,CCD Design and Ergonomics, United Kingdom

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CONFERENCE CHAIRMEN:

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Software

MRO, an IBM owned companywhich provides maintenancesoftware to oil and gascompanies such as BP,

Amerada Hess, China National Offshore OilCorporation, Pride International, Occidental,Total and Kazakhstan Petroleum, hasstarted promoting the idea that companiesshould use software systems to managethe maintenance of their IT systems, alongwith everything else.

Maintenance of IT involves such thingsas monitoring the health of hard drives,checking everybody in the company hasthe latest antivirus and is doing scans,checking that the company has theoptimum number of software licenses, andmaking sure the set-up is keptstandardised.

Oil and gas companies are puttingtogether increasingly complex computersystems, with embedded sensors in almostevery piece of equipment, and it isimportant to keep track of which parts arebeing used where and how close they areto the end of their expected lifespan.

Principles of maintenanceBut MRO believes that the basic principlesof maintenance software are the same,whether you are maintaining a pump or anIT asset.

"An asset is an asset - if it's a pump that'sbeing used for a critical operation, or if it'san IT asset," says Anthony Roe, director,natural Resources, EMEA, with MRO.

"Whether it's a sensor, or a valve or a tyre,maintenance is a similar process," he says."The principals of maintenance are prettystandard. You find a problem and decidewhat to do about it."

You build up a knowledge base ofinformation, such as the condition of items,when regular maintenance tasks should beperformed next, and how long they ranbefore failing, and you use this knowledgebase to optimise your maintenanceprocesses.

Ultimately companies should get abetter understanding of when things arelikely to fail.

The system provides information youcan use to make purchasing decisions, forexample if the time savings of aninvestment outweighs the cost, or it isworth switching the server off overnight todo work on it.

One systemMRO also believes that the IT maintenanceshould be incorporated into the samesystem as all other maintenance.

This way, rather than leaving everythingto an IT manager, it is clear who isresponsible for what.

To reduce overall downtime, ITmaintenance on a piece of equipment canbe scheduled to be carried out at the sametime as other maintenance.

"The majority of organisations stillpersist in running two distinct assetmanagement systems - one for 'traditional'

MRO helps you maintain your IT

assets such as lifts, pumps and track andanother for IT equipment," says RobinMartin, managing director, MRO SoftwareUK.

"With unintegrated systems there is nocommonality of information. There is nodependable asset register that provides atrue picture of an asset's history," he says.

"There is a growing asset ownershipbattle with the operations departmentwanting to manage and control all aspectsof the asset, whilst IT claims to be the onlydepartment capable to maintaining andmanaging the IT related asset," says Mr Martin.

Why have one maintenance system for the plant, andanother maintenance system for your IT? - RobinMartin, managing director, MRO Software UK.

The main purpose of the softwareis to give geologists in the officeinformation directly from theoilfield, so they can spend time

interpreting the latest data, rather thantrying to access it.

The software will also help geologistsshare the data and their interpretations, incharts, reports and raw data which can beimported into other software packages.

Gravitas is both the name of the wholesystem, and the name of the databasewhich holds all the well data, and validates/ indexes it. As well as raw data, thedatabase holds all the relevant documents,PowerPoint presentations, reports andcharts.

The database has a hierarchical systemfor managing data about specificmultilaterals /sidetracks, wells and wellgroups, which fits in with the way thereservoir is developed.

The data can be easily exported in otherrecognised formats, so it can be used as

part of other computer systems, such asthose used by geoscientists, petrophysicists,reservoir engineers and drilling engineers.

Different license options available,including single user / multi user / timebased. Users can be given different levels ofaccess.

The software is designed so that manyusers can work on it at once, with one editing data while another views thechanges.

There are several sub-tools.The WinDART module is the data acquisitionmodule, for acquiring data in real time fromthe well site. It can carry data in WITS(Wellsite Information Transfer Standard) format. It can handle data from LoggingWhile Drilling (LWD) / measuring whiledrilling (MWD) / Formation EvaluationMeasurement While Drilling (FEMWD), alsodrilling parameters and mud logging. Thedata is automatically fed into the Gravitasdatabase.

Winlog is a tool for drawing charts, logs

and reports of well data, including drillingdata and wireline data. It can be used forcorrelating data about different wells, andfor drawing summary diagrams. Winlogcommunicates continuously with the central database, so that charts can beautomatically updated as the data changes.

Winlog is not a new service; thecompany estimates it has a 90 per centmarket share of well log charting software.

Wincore is a new option for Winlog, todisplay and process are record of core andoutcrop analysis data.

Repgen is a report generating module,able to build customised reports of welldata, including planning, daily operationsand end of well. Reports can be generatedin .doc, .html and .pdf formats. Data can beimported from other software programs. Itconnects directly to the central database,so if the central data is changed, then thereport will be as well.

Predefined report templates have beencreated to speed up the process of makinga report. www.hrhgeology.com

HRH Geological launches well logmanagement suiteHRH Geological Services of Aberdeen has launched a new suite of software called Gravitas,for collecting and managing well data.

fuck.qxp 09/02/2007 20:28 Page 19


Software

http://www.pdf3d.co.uk/UK company Visual TechnologyServices has worked out a way toproduce reservoir models in 3D pdfs,so people can view them withoutneeding any special software.

It takes advantage of a littleknown functionality of pdfdocuments, released as part ofthe latest version of AdobeAcrobat in December 2005, tocarry models in 3d.

Users can look at the modelsfrom different angles, and movearound them (rotate, zoom andpan).You can turn surfaces onand off.The person looking at themodel cannot edit or change it inany way.

The pdf files can be easily e-mailed between different users orposted on intranets.

Distribute 3D models free as pdf

www.knowledgereservoir.comKnowledge Reservoir of Houston hasdeveloped a new service called'RightTime Analysis', as an outsourceservice to manage the data streamsfrom the well

Imagine if instead of gettingstreams of data and alarmscoming from your oilwells, youhad everything neatly displayedon a website, showing everythingyou need to know, cleaned up, soyou can make your decisions?

Imagine if you had someone togo through all the alarms for you,and sift out the ones you reallyneed to respond to - and also tellyou if you're operating the

archived data Detecting unexpected

patterns, by doing a neuralnetwork analysis of data streams.

Performing near wellboreformation evaluations

Monitoring for wellboreslugging,

Providing flow assurance,Providing guidance for long

range asset development.Knowing how to handle the

mass of data coming from thereservoir is not easy, which is whyknowledge reservoir thinks oiland gas companies may prefer tooutsource the work to itsconsultants rather than do itthemselves.

The input sources includepermanent downhole gauges,distributed temperature gauges,inflow control valves, LWD, MWD,

reservoir as well as you could beas well?

This is what a new service fromKnowledge Reservoir will do.Cheekily named 'Right Time'(perhaps a poke at the over-use ofthe term 'real time'), KnowledgeReservoir emphasises that therewill be real people looking at thedata, and they will take some timeover what they do.

But they will provide theanalysis in a timely manner - notas fast as the data is generatedfrom the well, but quick enoughto do something with it.

Knowledge Reservoir'sengineers will receive datastreams from all of the gauges,meters and sensors in the well.

Specific services included are:Detecting reservoir anisotropy

(variation in different directions)by performing analysis on

KnowledgeReservoir's 'RightTime'

The creator of the pdf canpreset viewpoints of the model, sothat the user will see this viewwhen the pdf is opened.The data file sizes are not as largeas you might expect - a fairlysophisticated model can use upjust a megabyte or so.

If you don't believe it, you cantry it for yourself - there are somesample 3D pdf documents youcan download at the company'snew website, www.pdf3d.co.uk.

Visual Technology plans to sellthe service to reservoir modellingsoftware companies, as a toolkit.

For example, softwarecompanies can put a 'save as 3Dpdf' button on their geosciencesoftware, generating a 3d pdf.

Making reservoir modelsavailable in pdf should make it

much easier toenable morecompanyemployees to getinvolved indiscussions aboutthe model.

UK companyOxford VisualGeosciences hasalreadyimplemented thesoftwaredevelopment kit.

" We haveexperiencedgeologists and geophysicistsnavigating through combined3D geological and geophysicalstructures and needing topresent reports on their findings,"says Frank Arnott, managingdirector of Oxford VisualGeosciences."We soon hope to use the PDF3D

facilities on mineral andpetroleum exploration fieldprojects where I'm sure we willsee much improvedcommunication and productivityby reporting to our clients in 3DPDF format."

multiphase flowmaters, alsoSCADA systems / decisioncontrol systems and logiccontrollers.

The clients get data deliveryon the web, cleaned up, withgraphs and histograms.They alsoget diagnostics, advice abouthow to optimise the well,estimations about their reserves,forecasts about their production.

"A large offshore oilfield canproduce 5 million engineeringvalues every day, and oilfield datamanagement systems can makethis data available to the desktopcomputer," says Mike Mitchell,managing director, DataHorizon.

"A service that implementsroutine surveillance, timelyanalytical response to anyexceptions, and advanced postanalysis, will extract tremendousvalue from this data archive."

RokDoc Scenario - helps you test 2Dmodelling ideas

www.rokdoc.comPetrobras and Hess Corporation have

signed up to use Ikon Science's RokDoc

software, which enables geoscientists

to work with different rock physics

models. This means that over 50 oilcompanies are now using thesoftware, including the 'threelargest supermajors,' the company says.

The new business wasgenerated by Ikon's new Houstonoffice.

Both companies are usingRokDoc Scenario, which helpsthem test 2D modelling ideas, andRokDoc 3D4D, which allows themto generate 3D and 4D reservoir

properties, using rock physicscombined with geological andseismic data.

RokDoc provides softwaretools to help geoscientists workwith seismic rock data, togetherwith different rock physicsmodels, so they can test differentreservoir and fluidinterpretations.

"Client feedback on howRokDoc is making a realdifference to prospect

generation and 3D and 4Dreservoir characterisation is verypositive," RokDoc says.

In a separate development,Paul O'Brien, sales director at IkonScience, has been promoted toexecutive director for sales andmarketing.

Also Charles Hue Williams, afounder shareholder of Ikon

Petrobras and HessCorporation buyRokDoc

www.petris.comDr David Archer, president of POSC

from 1997 to 2005, has joined data

management and exchange company

Petris. At Petris, Dr Archer will be vicepresident responsible for productmanagement and industryalliances, helping the company toidentify new opportunities and

David Archer joinsPetris

build solutions.Dr Archer has experience with

a wide range of energy relatedsoftware systems, includingseismic interpretation, reservoirsimulation and visualization,well-testing and nodal analysisand real-time predictivemodelling of pipeline networks.

He has MA and PhD degreesin Mathematical Sciences fromRice University and a BS degree in Mathematics from Texas Christian University.

Science, has joined the board as anon-executive director. MrWilliams is a partner of LambertEnergy Advisory, and waspreviously managing director ofKleinwort Benson Securities anddirector of Investec HendersonCrosthwaite Securities,specialising in the oil and gasindustry.

screenshot from a 3d pdf of a reservoir

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Software

Digital Oilfield- 6782 per cent growthCalgary-based, energy software company Digital Oilfield has announced a 6,782 per cent growth inthe period 2001 to 2005. We spoke to executive vice president Deborah Close about how they did it

Deborah Close, executive vice president

of Digital Oilfield

Oil and gas software companyDigital Oilfield, based in Calgary,is claiming a 6,782 per centgrowth for the five years from

2001 to 2005, enough to give it a ranking of42nd in North America, and 9th in Canada,in its survey of the fastest growingtechnology, media, telecoms and lifesciences company in North America inDeloitte's annual Fast 500 survey.

The survey ranks companies which haveproprietary technology, or invest asignificant proportion of revenues intotechnology development, with operatingrevenues at least $50,000 in the first yearand at least $5m in the current year.

Now, Digital Oilfield claims to be the oiland gas market leader in electronicinvoicing, with over 15,000 users in morethan 5500 different companies.

The company focused closely on digitalinvoicing for its first 4 years of existence,with a closely related online contractmanagement and price reconciliationmodule being launched in May 2002.

In February 2006 the companyexpanded its system to the rig, with a touchscreen system which could be installed onoilrigs, so suppliers can input their dailycharges, so they can be automaticallyreconciled later.

In March 2006, it made a brave step intoproject and activity management software,launching "ProjectAccelerator" to manage,schedule and co-ordinate drilling projects,and optimize other oil and gas operations.

ProjectAccelerator can be used foroptimizing business processes, spendanalysis, rig and resource scheduling, andwell lifecycle management, managingcomplex workflows across the oilfieldlifecycle.

The software enables parties involved toshare schedules and technicalrequirements, and track project status, taskassignment and completion.

Digital Oilfield could be in a position toput together comprehensive activitymanagement modules for all kinds ofactivities in an oil and gas company,something which many people agree theindustry needs, but no-one has yetmanaged to implement.

Success recipeWith so many companies struggling to findways to implement online workflowmanagement tools, how has Digital Oilfieldmanaged to pull it off?

The company attributes its success tofocusing closely on one specific businessactivity, working hard at it until it worked,and having staff with an intimate

knowledge of the oil and gas industry. Itonly moved outside its core product, digitalinvoicing, when it was confident that digitalinvoicing was working.

"To execute - you have got to have theright team, to put all those thingstogether," says Deborah Close, executivevice president.

"If you look at the management team ofour company - our founder, Rod Munropassed his 30 year mark in the E&Pbusiness a few months ago," she says. "I'vebeen in the oil business 30 years. I was inthe E&P business for half of my careerbefore getting into the technologybusiness."

"We've done this before - we've builtsoftware companies before - we've builtsystems," she says. "Over the years we thinkwe've developed a pretty deepunderstanding of the industry.

Another factor of success was focusingon building up a valuable network. "We'vegot a network of operating companies, andwe've got a network of suppliers," she says.

The key to selling and getting toolsrolled out, she says, is executivesponsorship, finding someone in thecompany who can support the initiative,who is interested in exploring newtechnology.

"You have to find someone who is anearly adopter," she said. "You have to gofrom company to company, and you find anexecutive that says, 'I buy into that. Youhave to work with them.'"

"Then we've got to stay in close contactwith those customers - and make sure youadd value," she said. "Sometimes you say -'we got that wrong.' And then you fix it."

"Many of the people who approvesoftware purchase decisions are notfinancial people - they are oil and gas fieldpeople," she says. "You have to get buy-infrom those folks, as well."

"We all know, there are executives whoaren't early adopters, they are verycautious."Most of the market outside thoseearly adopters is going to requirereferencable accounts, sometimes in hardnumbers - exactly the value we achieved."

"If you're not delivering value to thecustomers they will not be references foryou. We understood that before westarted."

The company was careful not toadvertise products which did not exist, asmany dot com companies were doing atthe time Digital Oilfield was starting out.

"In 2000, there were software companieswho didn't have a single customer - whohad billboards on some of the majorfreeways in Houston."We didn't think that

was the way to go. A visionary customer isnot going to buy because they saw abillboard or an ad."

When Digital Oilfield started offeringelectronic invoicing tools in 2002,connecting suppliers to buyerselectronically, no-one else was doing it."This was virgin territory when we started,"she says. "Now it's a well establishedcategory. The electronic invoicing market isbecoming mature.

Digital Oilfield says it wasn't ever a 'dot-com', but it did start up in the middle of thedot com era, 2000, with a very dot-com likebusiness model, setting up a network ofbuyers and suppliers.

Competing with SAPSo how does the company fight with giantsin accounting software, such as SAP?

"All of these years of industry experienceteach us not to compete with a gorillacompany as successful as SAP," says Ms.Close.

"For non-SAP customers, we tell them, ifyou use our software, you can use ourworkflow [developed specially for theneeds of the oil and gas industry]. Ourindustry knowledge - helped usunderstand the oil and gas tends to be alittle different workflow," she says.

SAP has been built for themanufacturing industry, which operatesvery differently to the oil and gas industry,she says.

"With manufacturing, the buyer specifiesthe goods that are going to be delivered. InE&P you don't know how much cement isgoing to be pumped until you'vecompleted the cement job."

fuck.qxp 09/02/2007 20:29 Page 21


Software

"For people already using SAP, we have asolution that enhances and complementsSAP. So, if you've already invested in SAP'sworkflow - and if you use our software, youcan access our supplier network," she says."We have more than 5500 suppliersonboard. Whereas, if they just buy SAP theyare going to have to go to all of thosesuppliers themselves".

Standard workflowsOne of the challenges many oil and gascompanies have faced when putting

together workflow software is thateverybody works in a different way."Electronic invoicing is a workflow modelabove all else," she says.

It is hard to create workflow softwarewhich suits everybody, and nobody takeskindly to their software asking them tofollow a workflow they don't want tofollow.

"Does everybody process an invoice inthe same way? There are some commonthemes - but there are also manyvariances," she says.

"You can build some generic softwareand hope many companies can use it, oryou can be a bespoke softwaredevelopment company, but that isn't ourbusiness model.

Digital Oilfield's approach is to puttogether a basic model, the way that mostcompanies work, and then tweak it to howthat specific company works.

"You have to build your software so thatit is flexible - to accommodate changes,"she says. "If you can't do that, you won't besuccessful."

"There has to be some level of allowingthe customer to define the workflow to acertain extent - and also the ability to fit amodel if they need to," she says.

Project execution softwareNow the company has made such a successwith one piece of workflow managementsoftware, it will be interesting to see howwell it gets on with its efforts to makeworkflow management software for entireprojects.

"It was an ambitious step," Ms Closeagrees, but one she thought Digital Oilfieldwas ready to make.

"We understand organisationalhierarchies, we understand how to hostsystems, we understand how to keepfinancial information secure - andcompanies can get very picky aboutfinancial information outside their firewall,"she says.

"You've got business processes, workflow,organisational hierarchy, security, all thesethings are necessary."

It is a step which could ultimately leadDigital Oilfield to being able to offer broadand comprehensive workflow systemswhich cover all upstream operations.

"We can model the prospect toproduction process or dive deep intobusiness in specific functional areas," shesays. "That's a huge process. But that is ourambition - certainly and the software hasbeen designed to do that."

"We've got to stay in

close contact with our

customers - and make

sure you add value."

"Sometimes you say -

'we got that wrong.'

And then you fix it,"

said Deborah Close

Norwegian company TietoEnatorscored top in a recent study byUS consultancy IDC, intohydrocarbon accounting

software, which can be used to monitorand manage the flow of oil and gas fromthe oilwell to the end customer.

Fifteen companies were evaluated ontwenty different criteria, which were boileddown to functionality, scalability andcustomer satisfaction, and ultimately twofactors, customer confidence and whetherthe products are fit for purpose.

As part of the study, IDC looked at thesoftware in depth, and also spoke to manyof the company's customers.

The solutions evaluated included e.g. P2Energy Solutions, SAP, TietoEnator, QuorumBusiness Solutions, Enertia Software,Merrick Systems and Halliburton.

TietoEnator also scored highest inresearch and development, it says,spending 21 per cent of all revenues intoresearch and development, found by IDC tobe the highest percentage out of all thecompanies analysed.

The companyTietoEnator makes hydrocarbonaccounting software, which covers all theactivities of oil and gas which happen oncethe oil has left the well head, from fluid tomoney.

Energy Components. "We didn't try toomuch to address other markets likeindependents."

"Then a year, a year and a half ago - wesaid, our software is mature enough - weshould try to address those markets as well.

"Now we have been able to sign 15 and20 new customers that are completely newto us. We have been signing companies likeMarathon Oil, Talisman, Devon Energy,Qatargas, Gaz de France and Santos. Theindependents market has been a bigpositive area for us."

This includes managing production ratesand quantities, transportation, salestransactions / invoicing, putting togethersales agreements, and revenue, andintegrating with accounting systems. Thereare also tools to manage and track cashflows, personnel, licenses and jointventures.

The software can be used to manageand schedule all of the storage terminals,pipelines, tankers and refining.

Customer baseTietoEnator built up is business bytargeting the Norwegian affiliates of oilmajors, when it started 10 years ago.

Since then, several oil majors havedecided that the software is best practise,and rolled it out internationally.

It has secured global frame agreementswith giants ExxonMobil, Shell, Chevron andBP. Statoil and ConocoPhillips are alsocustomers.

It has 20-25 clients altogether.Altogether, 200 licenses have been sold.

The software can be used for gas as wellas oil, and is used for a number of LNGprojects, including major LNG operationslike Nigeria LNG, RasGas and QatarGas.

"First of all, we really concentratedinitially on working together with the bigglobals - that was a strategic choice," saysTrond Arve Pettersen, head of TietoEnator

TietoEnator 'top hydrocarbon accounting software'

Trond Arve Pettersen, head of TietoEnatorEnergy Components

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Kongsberg buys Intellifield - interviewFollowing the acquisition of oilfield-office integrations leader Sense Intellifield by KongsbergMaritime, we interviewed Intellifield's president Borge Kolstad to find out what will happen now

Sense Intellifield, a Norwegiancompany which helps oilcompanies connect their wells totheir offices and manage the data,

has been acquired by Norwegiantechnology company Kongsberg Maritime.

Kongsberg is a leading manufacturer oftechnology for the maritime and defencemarkets, and is slowly building up itsposition in oil and gas, following anacquisition in June 2006 of Fantoft ProcessTechnologies, which makes systems tosimulate oil and gas process equipment,such as separators.

Sense Intellifield's President BorgeKolstad believes that one of the mostimportant things about his company is itsindependence, when most of itscompetitors (such as Schlumberger,Halliburton and Baker) often provide

oilfield integration services coupled withother services, such as logging and drillingservices.

The advantage of Kongsberg is that it ismuch larger, but is still independent, hesays. "As such, our position as anindependent is stronger."

"We give the oil companies control overtheir own data," he says. "We are trulyneutral. Our solutions will work with anycontractor, service company, and anydrilling company. We have tested that outwith more than 50 different contractorsand different service companies."

The company Sense Intellifield has been a remarkablesuccess story to date. It was founded inJune 2003, and 2006 sales were MNOK 115(USD 18.1m).

The company was acquired for MNOK290 (USD 45.7m) debt free, with a clausethat the price will go up, if the company isprofitable in 2007 and 2008.

95 per cent of the company's business isdirectly with oil majors, and 80 to 90 percent of Intellifield's revenue is from clientsoutside Norway.

The company recently opened a newoffice in Aberdeen, and has operations inHouston/GoM, Denmark, Mexico, Brazil, Asiaand the Middle East.

Sense Intellifield employs around 70people, of which 50 are software engineers.

It develops all of its software in house.It doesn't actually fit any sensors or loggingtools in the wells, but supplies softwaretools that can be used to capture the data,and transform it into standardised formatsfor well to office communications, such asWITSML and PRODML.

The data can be distributed to whoeverneeds it, and visualised on 2D or 3Ddisplays, so people can make decisionsduring drilling and production.

The company also builds physicalcollaboration centres where oil companystaff can monitor the data from the wells,use advanced software applications foranalysis, and make decisions faster andbetter than traditional.

"What we like to say is - if you canvisualise it - you can improve yourdecisions based on it," says Mr Kolstad.

"That's the business of Sense Intellifield.It's to capture, store and distributeinformation in real time."

Surveillance and optimisation Where things get really interesting is if oilcompanies can optimise their drilling andproduction in real time (ie while they aredoing the operations).

In order to do this, they need to take realtime data from the wells, and feed it intocomputer models of the reservoir andprocess system, which can tell them if thereis something they can do better.

Sense Intellifield anticipates that it willbe able to combine its expertise gettingdata from the wells, with Kongsberg'ssimulation expertise, in order to do this.

"Kongsberg is a major supplier ofsimulators for the marine sector," MrKolstad says. "Through the acquisition ofFantoft, Kongsberg is also a major supplierof process modelling and processoptimisation."

Sense Intellifield had been planning todevelop its own simulators, he says, butnow through the acquisition by Kongsberg,it has access to Kongsberg's simulatorbuilding expertise.

Sense Intellifield is already involved intest projects, one for one of the world'slargest oil companies, Mr Kolstad says,integrating its tools to gather data from thewell with reservoir visualization andanalysis software.

It acquired a company called "Systems inMotion"(SIM) in October 2005, which hadbeen developing 3D visualization tools forthe oil industry.

"We give the oil companies

control over their own data.

We are truly neutral.

Our solutions will work

with any contractor,

and any drilling company,"

says president Borge Kolstad

A visualisation of Sense Intellifield's collaboration centres - the company has been acquired by Kongsberg for $45.7m

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When it comes to oil and gas

company informationmanagement, there are atleast five totally separate

challenges which companies face,we learned at the IQPC Oil and Gas Exchangeconference in London November 13-14 2006.

The first, and most obvious, is sortingout the data in your company. You have todecide what data needs sorting andmanaging. Some old data won't be worththe trouble; some new data will be createdso fast that you won't be able to sort it ifyou tried. And you have to put someone incharge of managing the data.

The second challenge is putting systemstogether to create electronic data which istagged so that it is easy to find. People say,if you do this part of the job well, then youwon't have to do any data management atall (the first challenge).

The third challenge is encouragingpeople to share the data which is in theirheads. You can't just tell them to type it alldown. Some companies like ConocoPhillipshave developed clever ways ofencouraging social networks to develop inthe company, so people share theirknowledge personally, and alsoencouraging people to participate in onlinenetworks.

The fourth challenge is how you use thedata. While the idea of rigid softwaresystems to deliver the data people need iscompelling, in practise workplaces are fullof people with many differenttemperaments who all work in differentways. How can you build a system to caterfor the different ways people work?

The fifth challenge is how you organisewho builds all this stuff. Most companieshave an IT department. But it's increasinglyapparent that there's no point in thinkingabout IT without also thinking about thework processes which go on and the workthat people do. If you want IT managers tosort this out, then you genuinely do havethe IT managers telling people what to do,which is something many employees willfind hard to stomach.

There is someone who has solved howto do all of these things beautifully - you.

As Eric van Kuijk, principal workflowconsultant with Shell InternationalExploration and Production pointed out,your brain is wonderful at sorting throughall the day to day information and deciding

which bits of it need to be kept so they canbe retrieved later, and which bits can beforgotten. Not to mention sortinginformation so it can be easily retrievedwhenever necessarily, and gently deletinginformation which is no longer being used.

Maybe one day organisations will beable to manage information as efficiently asyour brain can. Here's how the world'sleading oil and gas companies are tackingthe problem.

Integrated operations atConocoPhillipsStein Wolden, manager of integratedoperations for the Ekofisk field withConocoPhillips, provided the best figuresDigital Energy Journal has ever seen abouthow much value can be achieved byintegrating operations.

"We are saving NOK 50m ($8.2m) a year[on the Ekofisk field] through our onshoreproject centre", he said. "We will save somemore when we fine tune the processes.

From the project centre outsideStavanger, the company controls andmanages 30 worksites. "Foremen used tobe offshore, now some of them work inStavanger," he said. "They can give support

directly to the worksite.""People were all a bit sceptical of

change, but after being there a year, theydon't want to go back offshore."

"So far we have 5 per cent productivityincrease," he said. "Our goal is 20 per centproductivity increase.

"Safety is much better than we hadbefore," he said. "And we don't have tosend people offshore all the time forsurveys."

ConocoPhillips started its integratedoperations project in 2004, as a way ofgetting much better information aboutwhat was going on and what to improve.

"We took a deep dive into ouroperations - 500 different studies," he said.

The effort followed the company settingup a drilling centre onshore to supportdrilling operations in 2003.

In 2004, it set up an onshore operationscentre. In 2005, it set up an onshore projectcentre. Today, from its onshore centres, itdoes production optimisation, it monitorsdrilling and production, and does planningand scheduling.

The company had been tracking thefinancial payback of onshore centres, thendecided to stop, when it found it was 15times the original investment, he said.

IQPC Oil and Gas Exchange 2006

The ConocoPhillips onshore operating centre, monitoring activity offshore. Photo courtesy ConocoPhillips

Digital Energy Journal went to IQPC's Oil and Gas Exchange conference in London November 13-14,with speakers from ConocoPhillips, Shell, Chevron Technology Ventures, Aramco, BP, Petro-Canada.We learned that everybody defines information management in different ways

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"The variation in our production output ismuch better - we have less unplannedshutdowns," he said. "We just celebrated200 days without any unplannedshutdown."

"We are also able to improve ourproduction optimisation, and in the nearfuture, from the onshore operationscentres, we will look for data trends andpatterns to have early warnings of thingsgoing wrong," he said.

The program also proves to be useful inrecruitment. "One of the drilling advisors,Mike Herbert, has classes with students, hesays, this is a fun way of doing it. If youcome with us, you'll be part of an excitingdynamic environment," he says.

As part of its research, ConocoPhillipsvisited a number of different companies tolearn as much as it could about integratedoperations. It learned a lot of keyperformance indicators (KPIs) from visitingVolvo.

It learned a lot about planning fromvisiting a post office co-ordination centreand a German shipyard. It learned abouthow different media can be integratedtogether from visiting a media house,he said.

Part of normal businessUniquely, ConocoPhillips does not see itsintegrated operations work as a discreteproject, but part of normal day to dayoperations. "It's a tool to improve ournormal business," he said.

Mr Wolden said he did not think he haddeveloped a system which could beexported to other ConocoPhillips locations."I don't think you can export it directly," hesaid. "You need to work your way - whatkind of arena is it going to be."

It is very important to focus on the usersmore than the technology, he said. Nobodywould ever say that the success of a cyclistcomes down to how good their bicycle is,and in the same way, people should not saythat the success of an integrated oilfieldproject comes down to how good thetechnology is.

Mr Wolden was asked if he thoughtNorwegian working culture was part of thereason for success.

"I think teamwork has always been aScandinavian style. It might be I'm notsure," he said. "Integrated operations hashad a boost in the last 2 years in Norway.The government is pushing it; we have theresearch institutions, the technicaluniversities."

Managing dataThe company is pulling all of its differentdata sources together, so it can find outhow well things are going and find thingswhich can be optimised.

"We started with a very cluttered system- with thousands of spreadsheets anddifferent systems. It was almost impossibleto make a plan. Today, we are in muchbetter shape.

It also takes good discipline, but people

like it to have some structure aroundthem."

"We had huge improvements in beingable to plan and schedule resources," he

said. "We do things like planning makingsure materials are there, following up onhow long things are taking,"

ConocoPhillips looked at how long itwas taking containers to go from Stavangerto the rigs and come back again. "It took 52days, we were very surprised," he said. "Wesaw, all the information is in SAP. Now weare down to under 14 days. It's better on asafety point of view, and we pay rent on thecontainers, so there's a cost issue as well."

The company has now decided to lookat more ways it can structure and use thedata it has to improve decision making. "Wehave a project called data to decision - D2D- to be able to provide decision support,"he said.

"Using key performance indicators tomanage performance and driveimprovement is extremely important," hesaid. "It's giving us a snapshot of if we aredoing OK. You discover new things all thetime. You see your potential and yourweaknesses.

Shell

Erik van Kuijk, principal workflowconsultant with Shell InternationalExploration and Production, reiterated thereasons why all oil companies need betterdata management; not enough people, the'crew' change, more complex EPoperations, an explosion of information,and problems retaining staff.

To achieve better data management,you need better process management,business process automation, staffdevelopment, knowledge management, hesaid.

Mr van Kuijk estimates that the effortsneed to be 40 per cent on the end users, 30per cent on the processes, 20 per cent onthe knowledge / information / datamanagement and 10 per cent on the tools.

Too often, people do not understandtheir role in the data supply chain, and

what the next person down the chainneeds, he said. More value in a system isnormally lost by the end users thananywhere else in the system.

The lack of focus on the end users ismaybe because a lot of the IT peoplebuilding the systems chose an IT careerbecause they felt their IT skills werestronger than their people skills. "We comein the industry on a technical side, wedon't know how to do the people side," hesaid.

People often jump to blame thetechnology because they know it, but it isnormally 10 per cent of the problem, hesaid. Technology can create as manyproblems for data management as itsolves, and it would be great if it stoppedmaking constraints.

One problem is the way informationmanagement systems were traditionallyput together, with the IT infrastructure first,followed by the software systems, data,work processes and then hoping peoplecould use it.

It makes more sense to do things in thereverse order, think about the people partfirst, then look at the work processes theydo, the data they will need to retrieve andinput, the software that will make it allwork and the IT infrastructure required tomake the software work. "I find, if you startfrom the top - people - you come up withwhat you need," he said.

One problem is that most softwareapplications are developed for specifictasks - 'stovepipes' - and no-one cared somuch about how well they integrated withother applications.

Software systems also become veryinflexible. "If you change your businessprocess today it can take a year toreprogram your systems," he said.

If the company had to change itssoftware systems fast enough to meet thechanging company needs, it would take"all the programmers in the world," hesaid. It is better to build systems which canbe easily adapted.

Managing dataOn the topic of managing data, Mr vanKuijk said he thinks that data will generallydeteriorate over time; you do need toemploy people to keep it in shape.

One solution is to give information atemperature level. 'Hot' information is e-mails and spreadsheets that people createall the time in their daily work andcirculate with colleagues; cold informationis the corporate documents and datastorages.

For 'hot' information, Mr van Kuijkrecommends that minimal efforts aremade to manage it; the information isgenerated faster than it could ever beindexed.

But at some point, information shouldgo through a cooling cycle, with decisionsmade about which data should be kept aspart of the company's data store. This

Erik van Kruijk, principal workflow consultant,Shell International Exploration and Production

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information needs to be structured.Mr van Kuijk talked about how

important it is for an informationmanagement system to presentinformation in an attractive way, just likeproducts in a supermarket.

These means that data is nicelyorganised and well labelled, like productson a shelf in a supermarket. The quality ofthe data should be known, it should bereliable, and the data is available.

Products are available which a usermight want. There is a lot of back officesupport which is never seen, such as stockcontrol and customer profiling, and puttingtogether structures (taxonomies).

Mr van Kuijk pointed out that you canhave anarchic, democratic and communisticinformation management systems.

Most systems start out being anarchic,with tons of data thrown together, and ahope that people can find what they need.

You want to gradually move to ademocratic model, with solutions "drivenby structured, intelligent debate," he said.

What you don't want is a communistmodel, highly structured, because it isultimately unlikely to succeed - it is toorigid for today's business environment.Things need to evolve with time into ademocracy, he said.

IT managersMr van Kuijk suggested that IT departmentscould ultimately provide a range ofdifferent services to help automateprocesses in a company.

As well as looking after software / ITinfrastructure, they could also help manageinformation flow (putting in proceduresand standards), and help automateworkflows, including defining the processes(including roles and responsibilities), andautomating the processes.

A good process would also take intoaccount people's different culturalbehaviours - or it could map people'sbehaviours using something like a MyersBriggs test, and then the software wouldhelp them work differently according to thetype of people they are. "I work in Houstonwith people from all over the world. Youignore the cultural aspects at your peril," hesaid.

Perhaps ultimately, instead of ITmanagers, companies will employ peoplewho can put together the whole thing,including defining what everybody doeswhen, what data they need, what data theyneed to put together, and what software isnecessary to make it work.

Automating well deliveryShell tried to automate one of its top 25business processes, well delivery, he said,with step by step processes which wouldautomatically present the right documents,and enable documents to be automaticallyfiled in the right place so they could beeasily retrieved.

"We built a system - you could see all theknowledge and documents related to thestep on one screen," he said.

Getting staff to use the system was noteasy. "My engineers said, you take away myfreedom," he said.

I told my engineers - I'm taking awayyour power to make a mess of things."

"Then they realised it would save themtime.

"They will love you - they say, I click onthe step and there's a word document Ineed. I close it the document - and I don'tneed to know where it's saved. They don'tneed to know how it works, they just knowit works."

"If it knows my name, it knows whichwell it is, it can fill in fields automatically,"he said. "It can link my e-mails to processsteps."

Shell is a big user of SAP, he said, but hadsome problems when SAP wanted tochange its architecture. "It didn't quitework," he said. "We wanted informationwhich was in different silos of SAP anddon't talk to each other."

Chevron Technology VenturesJohn Hanten, Venture Executive with ChevronTechnology Ventures, explained about howChevron invests in IT companies (as well asother technologies) in a venture capitalstructure. Two portfolio companies werehighlighted in the presentation.

Mr Hanten was speaking at the recent IQPCoil and gas exchange conference inLondon.

Chevron Technology Ventures hasinvested in MetaCarta, which provides away of searching for unstructureddocuments based on geographical links;MetaCarta has indexed over 10 millionChevron documents this way.

It has also invested in Tacit Networks,which can make it possible to open wordand excel files hundreds of times fasterover a long distance network, with arelatively low cost IT appliance (severalthousand US dollars) which is installed oneach end of the network.

Chevron invests in technology which it

believes can help Chevron; but it alsoinvests together with real world venturecapitalists, who are looking for financialgains.

By tying up with venture capital groups,Chevron can effectively spend otherpeople's money on its research anddevelopment. He showed an example of$35m invested by Chevron into 9companies that leveraged $450m offunding.

"We've done a pretty good job atbringing in 50 new technologies over fiveyears to many different parts of Chevron,"he said. "In addition to transferringtechnology, we are now seeing positivefinancial returns through portfoliocompany exit events."

The strategy is seen as a possibly costefficient way to invest in research anddevelopment. "Chevron spends less money(as a per-cent of revenue) on research thanmost other oil majors are doing, but weinvest in venture capital funds as part ofour technology access strategy," he says.

Mr Hanten has a strong background inoil and gas information technology. Hejoined Chevron in 1978 as a researchgeophysicist, and led the use of webtechnology internally within Chevron in1995 to streamline communications andbusiness processes. He was also a boardmember of POSC (now Energistics) from1991 to 2001, serving as chairman during1999 to 2000.

Chevron Technology Ventures looks atmany different areas of technology, but MrHanten says that his personal focus ismainly IT and high performancecomputing. "That's my technology sector"he said.

"You have to look for new technology around the edge,because new technologyf rom an early-stagecompany is not likely to be inserted into a mission-critical process,"Mr Hanten said.

Choosing where to spendChevron will only invest in businesseswhich have something beyond just aconcept. It will also only invest if theexperienced venture capitalists it workswith believe that the project can makemoney for investors.

Technologies have to be able tocontribute to Chevron's current set-up butwithout disrupting them too much. It willonly invest in businesses which it sees as a'strategic fit' with things the company is

John Hanten, venture executivewith Chevron

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trying to achieve."You have to look for new technology

around the edge, because new technologyfrom an early-stage company is not likelyto be inserted into a mission-criticalprocess," he said.

The company 'screens' 500 potentialinvestment opportunities every year, whichincludes proposals submitted to Chevronand others it hears about, from articles intrade journals, venture conferences,emerging technology conferences, andmost importantly through referrals fromother VC firms in its business network.

The most thorough investigation ismade by Chevron staff which might getthe benefit from it, and by the Chevrontechnology units that will work tounderstand the technology and verify thatit will fit within the existing ITinfrastructure.

It ends up with 10 finalists, of which itinvests in 5 per year. "So roughly 1 per centof opportunities wind up as investmentrecommendations," he said.

Technology needs to have potential forlarge benefits to be considered, he said."For IT, unless you can get a 10 x factorimprovement , it's generally not worthbringing in something new, because thechange costs are so large compared to thetechnology costs," he said.

Chevron also has an internal system forpeople to provide ideas, which can beassessed and validated.

You can submit a proposal for Chevronto consider on its websitehttp://technologyventures.chevron.com/.

Pilot projectsAn important part of the work is gettingthe technology tested and ultimately usedwithin Chevron.

Staff are encouraged to work with andacquire technologies from the companiesit invests in.

It can be a challenge getting pilotprojects into the company, he said.

"In good times like this peopleresources are generally fully scheduled,and managers have to be persuaded totake something off which has already beenallocated resources."

Mr Hanten was questioned aboutpossible strategies for new companies toget noticed. He suggested that onestrategy would be to partner with a 'bluehorse or a red horse' - ie Schlumberger orHalliburton. "You can be part of a muchlarger sales force," he said.

"That's the best way to go about it."This partnering approach can also help anearly stage company achieve large scaleand global presence quickly, somethingthat early-stage companies generallycannot accomplish on their own.

Other approaches Other delegates were asked how they

develop innovative IT in their company.One delegate said that they don't plan orbudget for innovative technology, andconsequently probably miss a lot ofopportunities. "The IT department can actas a shield and try to stop things becausethey don't believe it will fit," he said.

Another delegate from a major oil andgas company said they treat IT andinnovation separately in the business - theonly way the company buys new IT isnormally from salespeople knocking on thedoor.

MetaCartaMetaCarta, one of Chevron's investments,was spun-off from a research project atMassachusetts Institute of Technology(MIT).

The software searches for references togeographical places in documents, so it candisplay them geographically.

Essentially, it converts geographicaldescriptions into co-ordinates that thecomputer can understand.

The company has 17 million humanlocations in its database which can all bereduced to co-ordinates.

An example of the software can be seenon the SPE website,http://geodrive.spe.org/webiface/search.You can type in keywords and then seedocuments containing the keywords on amap, so you can quickly go to thedocument from the geographical area youare looking for.

There are 40,000 papers on the SPEwebsite, so this is a fast way of getting tothe papers you want.

MetaCarta acknowledges that searchingdocuments by geographical references inthem can only reduce the number ofdocuments you have to sift through, notnecessarily take you directly to the one youare looking for, but this can save a lot oftime.

The software proves particularly usefulwhen linking together documents aboutthe same geographical area which isdescribed in different ways, for exampleone document has the name of the fieldbut not the wells, and the other has thename of a well but does not mention thefield it is in.

"We don't have to know what you arelooking for; you have to know where you'retrying to look," says James Maupin, energybusiness development engineer,MetaCarta.

The system is particularly useful forexample for people who are working on aspecific field, and want to retrieveinformation about that field.

The data can be displayed in interestingways, for example you can draw mapsshowing land in different coloursdepending on the number of documentswith the keyword also mentioning thatlocation.

Dennis Seemann, AramcoDennis Seemann, information technologyco-ordinator with Saudi Aramco, talkedabout the challenges of putting together adata management system for SaudiAramco.

"No matter which way you go,there's always the "oh but we have this piece of data over here," says Dennis Seeman

Aramco has started a huge project formaking information in the company visible,using Documentum for indexed data (iedocuments); Oracle for structured data; andLOG DB for well log data, and OpenSpirit tomanage the data communicationsbetween the GeoFrame Schlumbergerreservoir characterisation system, andother software.

It is hard to appreciate how critical it isto get the taxonomy, the data classificationsystem, right. If it is right, everything getsmuch easier, he said.

"If I had to do it all over again, I wouldspend 50 per cent of my funds doing thetaxonomy correctly. Once you have it right,things start to define themselves," he said.

"It's easy to say and very difficult to do.You should get a consultant who knowshow to do it. Make him learn your business.If you get your taxonomy wrong, werevisited the issue on many occasions."

Aramco's original idea was to give eachpiece of data the same tag from thephysical sensor onwards, but found this tobe very hard to achieve, because differentsoftware systems would add its own tagsalong the way.

Now every piece of content has fivedata tags - a security code, a content class(type of data), who owns it, a uniquereference number showing where itbelongs to, and the taxonomy (eg whichwell, or piece of equipment, it refers to).

Mr Seeman stressed that data does nothave to be compiled in any particularexpert fashion, but how it is indexed ismuch more important.

"There are a multitude of ways that wecan look at the slicing and dicing," he said."No matter which way you go, there'salways the "oh but we have this piece ofdata over here."

Deciding who owns / has responsibilityfor each piece of data is another processwhich needed to be gone through, he said.

The document software can check if thesame word is being spelt in different ways,for example there are several spellings forthe field ABQAIQ in use.

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You also have to decide who can see whatdocument. "Its complex - if I want adocument to be seen by just these 3people, I have to create a new group. Andwhat do you do if one person goes onholiday," he said.

One audience member suggested that a'role based' access system, where peoplehave access to certain levels of data basedon their level in the company.

"Role based systems worked in 80 percent of cases. The rest are a nightmare,"said Mr Seeman. "I have to watch thenewspaper to see which VP moves fromwhere to where."

On the issue of making systemscommunicate with each other, headvocated against port to port integration(writing an electronic communicationslanguage for the specific items) becausethe work needs to be redone every time anitem is replaced. Open standards are better,he said.

Digital standardsJulian Pickering, domain lead drilling &completions, BP Exploration andProduction, talked about digital standardsand how the industry can do more toencourage the development and use ofthem, and what the blocks to developmentare.

Nobody ever disagrees with the idea of astandard, he said, but they do come upwith excuses not to implement them, or toput off implementing them.

But when they finally are implemented,like the OPC control system standard,people say "we don't understand why itwasn't launched many years ago," he says.

One automation company openly saidthey were concerned they would losemarket dominance when they moved toopen standards, but now they say, everytime new technology comes out, oursystems are better, he said.

"No-one will stand up and say there's novalue in the standard," he said.

Mr Pickering talked about WITSML, thestandard for wellsite information transfer,

developed by POSC (now Energistics) andgradually being used in the industry. "Whatit needs are people to be implementing it,"he said.

"Statoil and Norske Hydro have madeWITSML part of their business."

At BP, "we were kind of expecting oursuppliers will sort it out as we'll just buy it,"he said. "But we know that's not going tohappen."

Arthur Boykiw, director of the ISenterprise program office, oil sandssystems, with Petro-Canada, pointed outthat changing things to standard takestime. "Nobody has that kind of time," hesaid.

Jerry Hubbard, executive vice presidentwith standards organisation Energistics,said that his organisation has done wellpushing standards in North America andEurope, and is building participation in theAsia Pacific.

Tony Edwards, head of digital oilfield withBG, said that it might be too much toexpect everyone to agree on just onestandard. "56 standards is a problem, 2 or 3is OK, and 1 is a holy grail," he said.

UK DTIStewart Robinson, Director of IT and dataservices at the British GovernmentDepartment of Trade and Industry Oil andGas Directorate, and also director of oil andgas standards body Energistics, said thatthe UK Government is making its softwareto manage the country's oil productionreporting open source, so that any othergovernment or agency can use it free ofcharge.

The system would be particularly usefulfor countries which do not have electronicsystems yet but will need them soon, suchas Kazakhstan and Venezuela. They will beable to use the British system free ofcharge.

"The UK spent £3m building it," he said."The US government is spending 100 timesmore, and they could have had all of thisfor nothing. UK government policy is thatany software we develop has to be opensource", he said.

All reporting can be made paperlessly. Itincludes reporting about the location ofnew wells, and how they have beencompleted.

The UK Government is also a bigsupporter or WITSML, because it believes itcan be used for reporting well data.

Regulatory reporting standard?Outside the Oil and Gas Exchange, MrRobinson has made a proposal thatEnergistics should set up an electronicstandard for reporting and communicationswith regulatory bodies globally.

Regulatory authorities run the sameprocesses everywhere in the world,including running license rounds, issuingdrilling permits, monitoring drilling,receiving / managing well logs, receivingfinal well reports, issuing productionconsents, monitoring production, releasingdata, and managing abandonment, he says.

In fact, about 80 per cent of what allregulatory authorities around the world dois exactly the same, he says, so it would be intheir interests to work together and sharesystems and data communicationsstandards, rather than try to do it their ownway in every country.

Having global data communicationsstandards would greatly reduce the costs ofdeveloping and running systems forregulators. The British Government hasalready made its software to manageregulatory reporting open source, so anyother country in the world can use it (andimprove it) as they wish free of charge.

"Now is a good time to undertake thiswork," he says. "There is a growingcommitment towards sharing and the webtechnology makes cooperation easy."

The standards would be designed forelectronic communications but could beused on paper, with standard ways ofdescribing what is being communicated,and standard data being required, forspecific communications.

Coming up with standard ways of usingdata to describe things would lead tobenefits to governments still operatingpaper-based systems, as well as those doingit all electronically, he says.

The common problems regulatorsexperience are non-standard ways ofdescribing something with data (so it needsto be reformatted); incomplete data;inconsistent data quality; and data notavailable when required, he says. A standardcould help resolve these problems.

Global reporting standards wouldcertainly be a big administrative benefit tooil companies, if they could supply data toall authorities in the same way, without theheadache of trying to understand differentreporting systems in every part of theworld, and putting together systems tocommunicate electronically.

Mr Robinson suggests there could be anelectronic communications standard fordaily drilling reports, production data and

Tony Edwards head ofdigital oilfield with BG

Julian Pickering, lead of drilling &completions with BP

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IQPC Exchange

well completion data. Other ideas could bewell drilling permits, environmental dataand pipeline reports.

One of the biggest barriers toimplementing such a system, met in thepast, has been the differing attitudesregulators take to oil and gas activities intheir country - some are very prescriptive,others just monitor what is going on.

There has also not been any particularleadership, or suitable forum, for such aproject in the past. But Energistics is in agood position to run a project like this now,he says.

Mr Robinson suggests that Energisticscould use its new website to hostfacilitation, management and publicity forthe standards.

Energistics could also initially supportand sponsor the work from its currentbudget.

Mr Robinson proposes that the projectcould be started on a small scale, withinterest from regulators from a handful ofcountries, and ideally some oil companiesas well.

The first step would be to agree on whatfunctions the standard would cover (iedaily drill reports), what data would beneeded and standard ways the data couldbe provided.

There will probably need to be commonprocedures put together to manage accessto data, ownership of data, qualitychecking, log curve naming, cataloging andreleasing the data.

Ultimately, it should be possible to havestandard reporting procedures, andstandard data formats, which could be usedwith any regulatory authority.

Arthur Boykiw, Petro-CanadaArthur Boykiw, director of the informationsystems enterprise program office, oil sandssystems, Petro-Canada, said "there are nomassive data management problems."

"We have two differenttypes of data, but the principles are very much the same," said Arthur Boykiw f romPetro-Canada.

"If you think there's a mass of data you'retrying to get through, it's because youdon't have the proper tools," he said."There's no such thing as massive amountsof data. It doesn't weigh anything. Youwant to spend less time managing data."

PetroCanada had two specific datachallenges, firstly managing the drillingdata, and secondly managing engineeringdata and drawings. "We have 2 differenttypes of data, but the principles are verymuch the same," he said.

"You don't have to manage it, unless youdon't know what it is, you don't knowwhere to put it / how to put it there, youcan't access it, you don't have tools to useit, you don't know how to use it."

PetroCanada put a matrix together ofwhere different departments in thecompany are getting their data from, so ifthere is a mass of poor data it is possible totrace who isn't doing their job properly.

Vitesse Solutions James Kochan, managing director ofknowledge management consultancyVitesse Solutions, talked about the work hehas done for a major US oil company,building processes that took it from amongthe least active major oil companies forknowledge sharing according to a 2004survey by Arthur D Little, to having one ofthe best knowledge management systemsAD Little had ever seen in 2006.

"They want a knowledge system strategy-aggregating knowledge to drive continuousimprovement," he said. "We put together astrategy with them."

It is important to create social networkswithin the company, so that peopleexchange information with each other, anddevelop trust with each other, he said.

It is also very important to have anyproject supported by senior managementof the company. "I say - if you don't havethat, let's scale this down to somethingreally small," he said. "Grassroots efforts -don't have the staying power - eg it's anextra-curricular activity."

Proving the financial benefit of a projectis not essential but helps a great deal, hesaid. "If management is going to put time,money and effort into this, they need tounderstand the business case," he said."Everything thinks sharing knowledge isvaluable. But it's a lot easier to putsomething in an organisation if it has aprice tag."

It is also important to have goodsupporting technology, which enablespeople in different locations to shareknowledge, for example, transferringknowledge about ice operations fromoperations in Alaska to Russia. Onecommon problem is that people in differentlocations use different software systems.

Any online networks do need to have alevel of governance to them, he said. "Youcan't have ad hoc discussion forum, eg onYahoo, if you want a solution. You need aleader however your organisation ismanaged."

It is important that people understandhow joining networks will help. "People say,I'm too busy to network. We say - I want youto join that network because it will makeyou more effective on your day job," hesaid. "And we design networks to be morerelevant to people's day jobs."

Online networks provide an opportunityfor more people to contribute to adiscussion than you get with a telephonecall. "On the phone - its 1:1 and no-one elsegets a share in that," he said. "But there's nochoice for someone else to say, here's whatwe do in Alaska, here's a paper I wrote onthis subject."

Making a knowledge managementsystem is "like bringing up a human being, itwon't happen by itself," he said. "You goslowly, let the seeds make some roots, thengo to the next level."

Stewart Robinson, energyresources consultant, UK DTI

James Kochan, managing director of Vitesse Solutions

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