Technological Innovation Needed To Extract Value From Mature Oil Fields

With the oil industry facing an uncertain future in the wake of low oil prices, the maintenance of mature fields has become an extremely tough challenge. Despite the volatile economic environment, it is still possible for operators to wring additional value from these fields while keeping costs at a reasonable level, a trio of experts said. In a forum that took place at IHS CERAWeek in Houston, Tim Dodson, Michel Hourcard, and Leta Smith discussed the need for the industry to preserve mature fields by emphasizing technological innovation and creative management strategies. Dodson is the executive vice president at Statoil; Hourcard is a senior vice president of development, exploration, and production at Total; and Smith is a director at IHS. Dodson’s presentation focused primarily on Statoil’s efforts in the North Sea, particularly the Norwegian continental shelf. He said the mature areas in the Norwegian shelf remain attractive to the company because it is familiar with the geology, and it has the infrastructure in place to take advantage of the resources in the area. “As an operator of large production hubs in Norway, Statoil puts a lot of effort into proving up additional, timely resources in the surrounding areas in order to prolong the lifetime of the existing structure,” Dodson said. An example of this strategy is the Aasta Hansteen field, which was discovered by BP in 1997. Statoil is building a spar platform from which it will run the Polarled pipeline approximately 300 miles to a gas plant on the Nyhamna peninsula off the central Norwegian coast. Polarled is expected to deliver up to 70 million scf/D of gas to the Nyhamna plant. Furthermore, the company plans to build a separate pipeline between Polarled and the Kristin platform.

Worst-Case Discharges

In March, the SPE Board of Directors approved the publication of a technical report on the calculation of worst-case discharges (WCDs). The report, “Calculation of Worst-Case Discharge,” documents the consensus from an SPE-sponsored summit held in March last year. At the summit, 68 subject matter experts met in New Orleans with the goal of improving the methods of calculating and reporting WCD scenarios. The attendees—representing operators, regulators, academia, and service providers—developed the report, which was made available for comment for 30 days and edited to include comments before being approved by the Board. The focus of the technical report is on the calculation of WCD rather than well design or intervention. Its primary application is in the US Gulf of Mexico, although the report may be used for wells elsewhere. Deterministic methods are proposed because of the wording of regulations and requirements for detailed well design and response planning. Probabilistic modeling and statistical analysis are unacceptable. All reservoir properties, the report says, should be best-estimate, success-case values based on sound geology, geophysics, and engineering judgment. All calculation parameter values should be explained and justified to ensure consistency and transparency. Parametric sensitivity is recommended for identifying the major variables and their impact on the WCD calculation. Topics covered in the technical report include reservoir properties, inflow modeling, outflow modeling, total volume, special cases, and reporting. Future improvements could include flow correlations for high rates in large-diameter pipes, sonic velocity effects, and probabilistic methods. According to the report, the flow scenario should be modeled over the duration of the spill to determine when the highest, single-day flow rate from the well occurs, which may or may not be the first day. In multiwell situations, the report says, it is important to remember that the WCD well may or may not be the first well drilled on the block or in the field. Each potential well location must be assessed and the WCD determined by the planned well that has the highest WCD flow rate. The US Bureau of Ocean Energy Management defines WCD as “the single highest daily flow rate of liquid hydrocarbon during an uncontrolled wellbore flow event,” that is, the average daily flow rate on the day that the highest rate occurs under worst-case conditions (e.g., a blowout). It is neither the total volume spilled over the duration of the event nor the maximum possible flow rate that would result from high-side reservoir parameters, nor a distribution of outcomes. It is a single value for the expected flow rate calculated under worst-case wellbore conditions using known (expected) reservoir properties.

Accounting for HSSE in an Enterprise Resource Planning System

Enterprise resource planning (ERP) software systems help organizations manage data from product planning to shipping. By automating primary business-related processes, the systems allow companies to define their business models and plan workloads. However, most companies do not include processes related to health, safety, security, and environmental (HSSE) concerns within the scope of their ERP systems, and failing to account for HSSE may be a costly mistake, an expert said. Jeff Morgheim, a former climate change director at BP, said the early inclusion of HSSE practices in ERP systems is a good business practice because it sets a societal expectation that leads to improved decision making. He spoke at a webinar, “What About HSSE? Why Early Inclusion of HSSE Into Enterprise Resource Planning Efforts Makes Sense,” held by the SPE Gulf Coast Section’s Health, Safety, and Environment study group. Morgheim, who was part of BP’s executive team in the aftermath of the Macondo incident in 2010, is the founder of Edge Consulting. HSSE plays an important part in the operational excellence of an organization, Morgheim said. However, financial issues may make it difficult for a company to execute primary HSSE functions. “When an enterprise decides that it needs to implement something that allows all this information to flow together, the usual motivator has to do with getting a better handle on their accounting systems,” Morgheim said. “So, what you’ll find is that the executive sponsor within an enterprise will tend to be someone from within the finance function. That has an impact on the scope (of ERP implementation).” The following factors drive the inclusion of strong HSSE policies in an ERP system: Seizing the opportunity for near-term process improvements Avoiding rework Fostering a collaboration between functions Leveraging the risk reduction potential of an ERP system Enhancing workforce sustainability Signaling the role of HSSE to the organization Morgheim said near-term process improvements provide organizations with a framework for identifying the processes for simplification or elimination, and removing duplicity in data collection and reporting. An organization’s ability to use its HSSE policy in the investigative process in a consistent way with the rest of the ERP system is a powerful opportunity. “It’s a fantastic opportunity for your function to be able to sit down and look at how exactly our processes work,” he said. “Where do we get information from? Who do we get information to? How do we validate that information? What do we do with that information?” Avoiding rework on ERP systems is critical to keeping their cost down. Morgheim said incorporating good HSSE practices into a plan early will always cost less in the long run than retrofitting a plan to incorporate those practices after an incident. “As anyone who has done house remodeling knows, there is a lot less pain and suffering and mental anguish involved in designing all the rooms ahead of time rather than building two separate parts of the house and figuring out how you’re going to integrate them together,” he said. In addition, fostering collaboration between functions (operations, drilling, accounting, human resources, and the supply chain) helps reduce workload and errors within an organization. Leveraging an ERP’s risk reduction potential helps improve compliance, risk management, and operational assurance, which leads to long-term benefits in accounting and finance. Enhancing the HSSE workforce’s sustainability helps lower turnover costs and risks. It expands the pool of potential HSSE employees and lowers the costs to bring in new people. By emphasizing the importance of the role of HSSE, an organization is making it part of the creation of a culture of operational excellence. Morgheim said companies should reinforce the belief that good HSSE practices lead to good business practices.

STEM Learning Lab Promotes Love of Science and Maths in Children.

STEM Learning Lab provides young students with engaging and interactive learning experiences in science, technology, engineering and math by integrating those subjects in ways that are fun and hands-on.

For example, STEM’s curriculum also includes the powerful robotics platform EZ-Robot enabling kids engage in science and technology through building and playing with robots.

Here’s more from founders Gina Cherkowski and Ryan Clements:

How did you come up with the idea for your startup? Was there an “ah-ha” moment?

Gina: After many years of teaching in the classroom we still have so many kids who don’t have the competitive advantages in a world that requires an understanding of math, science, data, technology, and real world problem solving. This new world is based on having strong numeracy skills as well as visual and spatial reasoning skills. Adding arts to the equation is one way to do this.

We can also build these skills by teaching math visually using spatial temporal reasoning and by teaching things such as robotics. Most school curriculums do not target visual spatial skill development; in fact it is the smallest part of most math curriculums. Given that visual spatial reasoning is critical for learning, we know that supplementing children’s experiences with activities that promote visual spatial skills is important.

We wanted to provide a platform for children to learn these important skills while they are engaging in fun hands-on experiences and making new friends. Our camps not only target visual spatial skills and math and science skills, we also foster the development of computational literacy, analytical reasoning, problem solving, computer programing and logic-systems thinking.

What has been the biggest challenge so far? What have you done to solve it?

Distinguishing our niche from the many other great camps that are currently available. Parents need to find camps that best support their child and also understand the difference between each camp and what best suits them. Our niche is very different from any of the other camps in that our focus is on the visual spatial dynamic in learning through robotics and maker activities. To solve this challenge we have created many strategic partnerships, which has given us exposure and access to new networks, established relationships with many schools, and provided many demos of the robots and how they will work in our camps.

What’s new with your startup that we can share?

We have a full slate of camps and workshops for this summer open for registration at www.stemlearninglab.com. In the fall we will be adding math and robotics programs as well as science and computer camps for home-schoolers. Later this year we will launch a series of enrichment camps for kids on weekends, a pre-school program targeted to develop young children’s visual spatial skills that are critical to develop from ages 3 to 5, and bots for tots camps.

What advice would you like to share with others just starting out?

Take a process driven approach – utilize lean startup thinking, get your product to market quickly, test it with real customers and improve it based on feedback. Develop many strategic partnerships, networking opportunities, and mentoring relationships.

What made you choose to go down the path of entrepreneurship?

We both wanted the freedom to create things that added value and solved problems for others. We love the creative process, developing relationships, and the ability to act independently. We also are driven by the idea of disruptive innovation and we saw an opportunity to offer kids things that they couldn’t get in schools.

What do you and your startup need help with?

Getting the word out, growing our exposure and connecting to the people who could most benefit from our product. Please visit www.stemlearninglab.com for more information.

Lloyed Lobo covers technology startups in Alberta. He is a partner at Boast Capital and co-founder of Traction Conf. If you’d like to be featured, please email llobo@boastcapital.com.

Renewable Propane-Our Gabbage Could Produce Renewable Fuel.

Propane is a relatively clean-burning alternative to fossil fuels such as gasoline and diesel. But drilling for propane can damage the environment and in the end adds to the atmosphere’s carbon content.

Converting Waste Biomass & Garbage Into Propane

The US propane market has been in the news over the past several years as its supply and price have been very unstable, with shortages having a negative effect on some sectors of the economy. Coming up with a renewable form of propane for use in furnaces, outdoor grills and to make liquefied natural gas would be a major breakthrough as it would increase overall supply and significantly reduce carbon emissions.

Creating Next Generation Biofuels

Researchers at Imperial College and the University of Turku are developing a renewable form of propane that is created through microbial biosynthesis using the “fermentative butanol pathway.” Until now scientists have not been able to find natural metabolic pathways for renewable biosynthesis.

The process involves using E. coli bacteria, Escherichia coli, derived from human intestines and fatty acid synthesis. Now researchers are working to make the process scalable for commercial production.

Papers on the process have been published in the Journal of Biotechnology for Biofuels and the Journal of Nature Communications. According to the papers, genetically engineered bacterium could also be used and possibly ready for commercial-scale production within the next decade.

One obvious application of renewable propane would be to supply it to automobiles equipped with CNG or propane retrofits.