revista e&p - octubre 2011

8/10/2019 Revista E&P - Octubre 2011

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E P M A G . C O M

O C T O B E R 2 0 1 1

Electromagnetics

ImprovingExplorationSuccess

Mature Assets

MPD/UBD

SubseaTechnology

Regional Report:CANADA

Balancing cost and productivityin stimulation technology

Balancing cost and productivityin stimulation technology

WEIGHINGt h e o p t i o n s


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96 REGIONAL REPORT:CANADA

IMPROVING EXPLORATION SUCCESS

Mapping horizons leads to greaterexploration success

Banish the ghosts from marine seismic data

Three-D seismic advances improveexploration success

ELECTROMAGNETICS

CSEM: Smoother seas ahead

Integration of seismic and CSEM datareduces risk

MPD/UBD

Automated MPD improves drilling efficiency indeepwater GoM

Closing the loop alleviates challenges

SUBSEA TECHNOLOGY

Dry breakaway technology delivers efficiency

MATURE ASSETS

Mature fields add to the bottom line

Perforation tunnel tool optimizes mature assets

IndustryPULSE:Technology trends reshapebusiness landscapeTaking advantage of evolving technolo-gies helps companies maintain a compet-itive advantage.

EXPLORATION & PRODUCTIONW O R L D W I D E C O V E R A G E

OCTOBER 2011VOLUME 84 ISSUE 10

A HART ENERGY PUBLICATION www.EPmag .com

COVER STORY

32

Sleeves vs. Shots The Debate RagesCompany preference between the two mostpopular methods for stimulating horizontalmultistage completions breaks down to astudy in the economics of expediency versusthe economics of a systematic approach.

8

WorldVIEW: North Seaoperator continues to seeopportunitySticking with what you know can providea solid foundation for moving into newfrontiers.

12

Unconventional: Eagle FordEagle Ford output continuesto soar

New data suggest the Eagle Ford shale may soonbecome the biggest producing shale play in Texas.

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production from the Norwegian Continental Shelf can supp ly millions of Europeans with power.th industry and homes are connected to a cost competitive energy source , and will remain so for decadescome . Be enlig htened goodideas.statoil .com . There 's never been a better time for good ideas .

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AS I SEE ITEFD program expands 5

MANAGEMENT REPORTCollaborative tools come of age 16

DIGITAL OIL FIELDNew technology optimizes operations 20Data environments prove viable best option for E&P customers 23

EXPLORATION TECHNOLOGYSeismic leads the way for geothermal 27

WELL CONSTRUCTIONA new twist on an old problem 29

PRODUCTION OPTIMIZATIONPositive outlook for offshore 31

TECH WATCHNew system fills gap between PDM, rotarysteerable technologies 88

TECH TRENDS 92

INTERNATIONAL SPOTLIGHTNova Scotia shows promise as deepwater bright spot 95

INTERNATIONAL HIGHLIGHTS 102

ON THE MOVE/INDEX TO ADVERTISERS 106-107

LAST WORDReduce uncertainty, risk in drilling projects 108

E&P (ISSN 1527-4063) (PM40036185) is published monthly by Hart Energy Publishing, LP, 1616 S. Voss Road, Suite 1000, HoustonPeriodicals postage paid at Houston, TX, and additional mailing offices. Subscription rates: 1 year (12 issues), US $149; 2 years (24 issues)copies are US $18 (prepayment required). Advertising rates furnished upon request.POSTMASTER: Send address changes to E&P, PO Box 5020, Brentwood, TN37024. Address all non-subscriber correspondence to E&P, 1616 S. Voss Road, Suite 1000, Houston, Texas 77057; Telephone: 713-260-644inquiries should be addressed to E&P, 1616 S Voss Road, Suite 1000, Houston, TX 77057; Telephone: 713-260-6442 Fax: 713-840-1449; cugy.com. Copyright Hart Energy Publishing, LP, 2011. Hart Energy Publishing, LP reserves all rights to editorial matter in this magazine. Noduced or transmitted in whole or in parts by any means without written permission of the publisher, excepting thatphotocopy is granted t o users registered with Copyright Clearance Center/0164-8322/91 $3/$2. Indexed by Applied Science, Technology IndexInc. Federal copyright law prohibits unauthorized reproduction by any means and imposes fi nes of up to $25,000 for violations.

DEPARTMENTS AND COMMENTARY

ABOUT THE COVER Companies continue to test the balance between plugand perf (PNP) and openhole multistage (OHMS) completions, while ice remains achallenge to Atlantic Canada operations. (Photo courtesy of Greg Locke; coverdesign by Laura J. Williams)

COMING NEXT MONTH Read the November issue of E&P to find out the experts views on thestatus and future of intelligent operations. See how operators are improving efficiency and take a lookat what is new in passive microseismic technology. Read the drilling feature for the latest advances indrilling and automation control and the production feature to find out about innovations in flow assur-

ance and sand and water management. The Offshore focus for November investigates how new deep-water interventions are being applied, while the regional report showcases the Middle East. A look at theWoodford shale rounds out the issue. And dont forget to check out EPmag.com for the latest news.

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ONLINE CONTENT OCTOBER 2011

PREMIUM CONTENT Subscribe @ EPmag.com/explorationhighlights

Whiting Niobrara wildcat flows 1,061 b/d, 1.56 MMcf/dThe #16-13H Wild Horse horizontal well in the Denver-Julesburg basininitially flowed 1,061 bbl of oil and 1.56 MMcf/d of gas for Whiting Oil& Gas Corp.

AVAILABLE ONLY ONLINE

Next big shale play?The Canadian ArcticBy Scott Weeden, Senior Online Editor

Onshore companies are focusing effortson shale formations in the centralMackenzie Valley.

Slow recovery rate projected forGulf of Mexico drillingBy Mike Madere, Senior Online Editor

GoM active rig count of 20 may be

unsustainable at the current pace ofpermit approvals.

New Zealand could be net oilexporter by 2030By Scott Weeden, Senior Online Editor

Ministry of Energy and Resourcesproposes changes to how oil and gasexploration rights are issued.

R E AD T H E L AT E S T E P m a g .c o m I N D U S T R Y N E W S

Eni hits gas payat Kutei basin, IndonesiaRome-based Eni encountered gas at the#1-Jangkrik North East well in the MuaraBakau Block located in the Kutei basineast of Kalimantan offshore Indonesia.

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with exploration offshore CyprusHouston-based Noble Energy Inc. hasplanned an exploration well offshoreCyprus in the Block 12 concession in theEastern Mediterranean.

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"When your maturewells go quiet , it paysto know who can turnup the volume-or turnit off altogetherReducing risk and uncer ta in ty while eff ic ien t lyimproving ultimate r ecovery or performing a plugand abandonment Meeting all HSE standardsAddressing concerns about effectiveness costand availability of equipment. Solving your mature

field challenges is what Halliburton does daily aroundthe world . All thanks to e xtensive experience ,cost-effective and challenge-specific solutions , anhow Halliburton experts work collaboratively withoperators to get it right every time.

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The Environmentally Friendly Drilling (EFD) program, managed by the Houston Advanced Research Center (HARC), is funded by the US Department of Energy, theResearch Partnership to Secure Energy for America (RPSEA), industry, and environ-mental organizations. The program focuses on technologies for developing energy

sources that can be cost effectively applied in environmentally sensitive areas. According to Richard Haut, HARC senior research scientist, the program objective is

to identify, develop, and transfer critical, cost-effective, new technologies that can provide policy makers and industry with the ability to develop reserves in a safe and envi-ronmentally friendly manner.

A European Chapter of the EFD program was created in September of 2010 kickedoff with a workshop held in conjunction with the 2010 SPE annual meeting in Flo-rence, Italy. The goal was to identify and apply best practices in Europe and to identify new innovations and applications, Haut said.

In the past two years, a new gas shale development is being initiated nearly every week. As this new resource expands, opportunities are expanding for US companies that have developed technologies and the wherewithal to expand internationally, he said.

The EFD management team works with Gerhard Thonhauser at the University of Leoben, Austria, to manage the EFD European chapter and perform related research.

According to Haut, having US and European EFD programs enables all operators andregulators to learn about technologies being developed and implemented throughout the world, fostering relationships between Europe and the US.

Innovation knows no geographic boundaries, he said. Although requirements in countries with strict regulatory standards possibly could

prevent the development of natural resources, Haut believes those same restrictionsalso can encourage innovation and lead to the development of new technologies that could be applied in the US as well as in Europe.

The EFD program addresses new low-impact technology that reduces the footprint of oil and gas activities, integrates light-weight drilling rigs with reduced emission

engine packages, addresses onsite waste management, optimizes systems to fit theneeds of specific development sites, and addresses environmental issues. In addition,the program includes industry, the public, environmental organizations, and electedofficials in a collaboration that addresses concerns on development of unconventionalnatural gas resources in environmentally sensitive areas.

The EFD team has been evaluating the performance of a new low-impact drilling rig,has participated in a number of gas shale workshops and meetings across Europe, andhas established a work scope for assisting with gas shaledevelopment in the Ukraine.

The EFD team has briefed US and international govern-ment agencies about unconventional gas issues, and wehave learned we all share similar goals and objectives,

Haut said.

As ISEE IT

1616 S. VOSS ROAD, STE 1000HOUSTON, TEXAS 77057

P: +1 713.260.6400 F: +1 713.840.0923www.EPmag.com

EFD program expands

7

Read more commentary atEPmag.com

JUDY MURRAY

Editor [email protected]

Editor JUDY [email protected]

Senior Editor RHONDA [email protected]

Senior Editor TAYVIS [email protected]

International Editor MARK THOMAS

[email protected]

Associate Editor NANCY [email protected]

Corporate Art Director ALEXA SANDERS

Senior Graphic Designer LAURA J. WILLIAMS

Production Director& Reprint Sales JO LYNNE POOL

Senior Editor/Manager,Special Projects JO ANN DAVY

Executive Editor Online RICHARD MASON

Director of Business Development ERIC ROTH

Group Publisher RUSSELL LAAS

Editorial Advisory Board

CHRIS BARTONSr. VP Business Development, Oil & Gas., KBR

KEVIN BRADYVP, Sales & Marketing,Verdande Technology Inc.

MIKE FORRESTExploration Consultant, formerly with Shell

JOHN M. GILMORE JR.Director of Global Industry Solutions UpstreamOil & Gas, Invensys Operations Management

CHRIS JOHNSTONVP & Managing Director, North America, Ensco

ULISSES T. MELLOManager, Petroleum & Energy Analytics, IBM

DONALD PAULExecutive Director, University of Southern

California Energy Institute

EVE SPRUNTBusiness Development Manager,Chevron Energy Technology Co.

MANUEL TERRANOVASr. VP Regional Operations & Global Sales,

Drilling & Production, GE Oil & Gas

RONNIE WITHERSPOONSr. VP of Marketing & Business Development,

Nabors Drilling USA LP

DENNIS A. YANCHAKSr. Geosciences Advisor, Apache Corp.

Vice President, Digital MediaRONS DIXON

Senior Vice President, Consulting GroupE. KRISTINE KLAVERS

Executive Vice President & CFOKEVIN F. HIGGINS

Executive Vice PresidentFREDERICK L. POTTER

President & Chief Executive OfficerRICHARD A. EICHLER

H A RT E N E R G Y


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Technology is evolving fast. For that reason, it isimperative that companies focus not just on thechanges happening today but also on emerging techno-logical trends that are shaping the future of organiza-

tions and industries. The more anticipatory a company can be with regard to technology, the more creatively it can use that knowledge and planning to gain competi-tive advantage.

Just-in-time trainingThanks to cloud-based technology, the world is on thebrink of a revolution in just-in-time training. This willenable people to use their laptops, cell phones, and tablet computers as a tool to receive training precisely whenthey need it. In the current training model used by many organizations, people often receive training before they

actually need the expertise, a practice that takes themaway from their jobs and costs the company money.

With just-in-time training, companies can keep peoplein the field until they need specific training. When aperson needs a certain skill set to complete a job or doa task, he or she can receive training in real time viacloud-based technology.

For example, suppose a service company has new drilling equipment that its technicians have to install andoperate in a manner different from what has been done inthe past. Rather than taking people out of work and put-ting them in a multiday training course, the company

keeps them in the field. When it is time to install anduse the equipment, they can receive the training onhow to do so in real time via their mobile devices.

Suppose a technician has used the training module but is still confused about a certain aspect of the machinery.He touches the help icon on his screen, and it immedi-ately connects him to a master trainer live on the screen.The technician can put on a headband that has a cameraon the front, much like the headbands with lights that people use for camping or car repair. By wearing thisdigital, high-resolution camera that interfaces with themobile device, the field operator can show the master

trainer exactly what the issue is. The master trainer canlead the field operator through the issue as if he werestanding right there. This approach promises dramaticsavings and increases in efficiency.

Using cloud-based technology for just-in-time servicesgoes far beyond installation or repair. It can be used to

train people on new software, product upgrades, and onnew policies and procedures, etc. And it is different andbetter than a standard tutorial because the training canbe accessed via any device anywhere and at any time,and it offers an option for live help. In reality, the appli-cations for cloud-based, just-in-time services are virtually limitless.

Processing power on demandThe increased bandwidth mobile devices now receiveenables people to connect to cloud-based technologieseasier and faster than ever before. And bandwidth will

October 2011 | EPmag.com 8

industryPULSE

Technology trends reshapebusiness landscapeTaking advantage of evolving technologies helps companies maintain acompetitive advantage.

Daniel Burrus , Burrus Research

Embracing cloud computing can aid in training.


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continue to increase. Because of this, another emergingtrend is processing power on demand or virtualized pro-cessing power.

So many things already have been virtualized. Datacan be stored on a cloud-based network. Many compa-nies choose this option for data safety and ease of backup as well as for the ability to access the data viaany device. Desktops have been virtualized to be seenon anyone elses machine.

It only makes sense, then, that processing power willbe virtualized too. In other words, a mobile device only has a certain amount of processing power. But by tap-ping into additional processing power via cloud-basedtechnology, users can turn their mobile devices intosuper computers to perform advanced simulations and

crunch different data streams together to get real-timeanalytics. Suddenly the handheld device is as powerfuland advanced as a desktop. If employees had the capa-bility to do complex work that required advanced pro-cessing power while they were on the road, armed withnothing more than their mobile device, the increases inproductivity would be enormous.

Creative application of technologyFor these trends and others to fully emerge, businessleaders have to consider what their people would do

with the technology. It is no longer enough to deploy

technology; companies have to consider how peoplecan creatively apply the technology to gain competitiveadvantage.

To find the answer to this question, they need to asktheir internal customers (the people using the technol-ogy in the enterprise) what they want technologically.The next step is to give them what they ask for with theunderstanding that most of them will under-askbecause they do not know what is technically possible.

What employees are not asking for is bigger and better

capabilities the things they do not even know exist.The key is to go to the next level and give people the

ability to do what they currently cannot do but would

want to do if they knew they could. After all, peoplereally did not ask for an iPhone or a Blackberry. Thehidden need was the ability to access email and theInternet without being tied to a desktop or laptop.

The goal is to put existing technologies together anduse them in a creative way. For example, there are liter-ally thousands of features in Microsoft Word that userscan select, but most people are using only seven to 10features. And competitors are using the same features,

which means companies are not getting any true com-petitive advantage.

Managers need to ask questions such as, What fea-

tures would be great for our sales group (or HR, oraccounting department, or logistics people, etc.) touse features that are so buried in the software that noone knows they exist? Most IT departments will not askthose questions because they are too busy making sureeverything is connected, working well, and safe. And if they are not asking, who is? Chances are the answer isno one. As such, it is safe to say that all tools areunderutilized.

Companies need to implement a communication vehicle that engages the different groups served in theenterprise sales, logistics, purchasing, accounting, HR,

etc. and help them understand the power of the toolsto which they have access.

One suggestion is to automatically show them a featureof the day and how it can make their lives easier. Thisapproach provides information in short, fun, engaging

ways rather than in a hundred-page document (which noone will read anyway) that details all of the features.

Creating a companys futureMany business leaders will say they are too busy to address

any of these trends. But if they do not address them, who will?

Ultimately, whoever drives thesetrends within an organization will beseen as a significant contributor tothe enterprise. That someone candrive results to the bottom line and bea key contributor to the organiza-tions success.


industryPULSE

Desktops can be virtualized to be seen

on any machine.


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North Sea operator continues to see

opportunitySticking with what you know can provide a solid foundation for moving into new frontiers.

H eadquartered in Denmark, DONG Energy considersitself to be one of the leading energy groups inEurope. Sren Gath Hansen, DONG Energys executive vice president in charge of Exploration & Production,

refers to DONG as an integrated energy company.DONG is the result of a merger among several largeplayers in the Danish energy sector. In 2005, we hadseveral separate power producing companies, an E&Pand gas transmission and wholesale company, and sev-eral distribution companies, which we merged into one joint company, Gath said.

Today the company has more than 6,000 employeesand is continuing to grow. Danish 76% state-ownedDONG had annual revenues in 2010 equaling US $10billion (6.3 Bn GBP) with earnings of $2.5 billion (1.6Bn GBP). In a Danish context, DONG is among the

three largest companies in the country. On an interna-tional level, the company is classified as small to mediumsize.

According to Gath, DONG is working to expand itsportfolio both as a major European utility player and asan E&P company. Originally, power generation wasbased on coal-fired plants, he said. We are now chang-ing that to natural gas and biomass to decrease CO 2

emissions overall. In 2006, we set a target to reduce ourCO2 emission per MWh by 50% in 2020, and we arealready ahead of our plan to reach this target. We arealso a world leader in offshore wind energy with signifi-cant investments in Denmark, Germany, and especially UK, Gath said.

As DONG continues to invest in its utilities arm, the

company also plans to expand its E&P offering. Thecompany operates across the Danish and Norwegiancontinental shelves and is the largest license holder inthe West of Shetlands, with recent discoveries includingGlenlivet, Laggan, Tormore, Edradour, Rosebank,Cambo, and Tornado.

At the end of 2010, DONG Energy held 73 licenses inNorthern Europe: 13 production licenses, 11 underdevelopment, and 49 exploration and appraisal licenses.DONG Energy operates 10 licenses in Denmark, sevenin Norway, eight in the UK, and one in Greenland.

DONG is a mixture of E&P and utility, said Gath.

We have seen better results in the first half of 2011 thanthe same period in 2010, which was our best year todate, outperforming most of our peers, he added.

Of the revenue for 1H 2011, 34% of the earnings camefrom DONGs E&P sector. Part of our success is because

we have changed our strategy to strengthen our E&Pefforts while increasing our focus on green energy as

well, Gath said. In coming years, DONGs E&P develop-ment will increase in addition to adding more wind andbiomass power generation to our mix, he said. The com-pany is heavily invested in several wind farms that willcome online within the next two to three years.

From partner to producerDONGs energy growth strategy was marked by several sig-nificant events in the past 12 months. The Nini East fieldon the Danish shelf was put into production, followed by the Norwegian Trym field at the beginning of 2011.

Exploration for new reserves has resulted in two discov-eries, one in the Solsort license in the Danish sector of the

Sren Gath Hansen, DONG Energys executive vice president, E&P:

Part of our success is because we have changed our strategy to

strengthen our E&P efforts. (Image courtesy of DONG Energy)

Tayvis Dunnahoe , Senior Editor


worldVIEW


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worldVIEW

North Sea operated by DONG E&P and one in theEdradour license in the UK sector in which DONG E&P ispartnering with Total, the operator. In 2010, DONG E&P

participated in investment decisions to develop the Lag-gan-Tormore licenses in the UK North Sea and Marulk inthe Norwegian Sea, and it is initiating further develop-ment of the Syd Arne field offshore Denmark. The com-pany also has been awarded a new West Greenlandlicense, three in the UK, and one in Norway.

We have a well diversified portfolio comprising assetsin mature areas in the Southern Norwegian and DanishNorth Sea, assets with fresh new production in Mid-Nor-

way, assets in growth areas such as West of Shetlands, andfrontier areas such as the Barents Sea and Greenland,Gath said. The companys strategy has been to focus onthese areas: We know the political systems, we know thebusiness culture, and, we know the subsoil, he said.

Gath believes there is good value in partnering withlarger operators. We always play an active role in projects

because we are learning at every phase and believe that wecan contribute in a value-creating way, he said. DONG iscurrently one of the largest holders in the West of Shet-lands. We set out a long-term strategy, Gath said. In2000, the company made the decision to get into the

West of Shetlands when few people believed in the areaspotential. We wanted to fully understand the region. We

wanted to be basin masters who understood all the playsin the area, he said. The company has managed to breakthe code in the West of Shetlands and has participated innine discoveries in the area since 2000.

Our primary objective for all of our operations is to

develop and understand the subsoil in a particular regionand make a difference with this applied knowledge,Gath said.

Although some of the companys assets could be consid-ered mature fields, many have years of productionahead.

The Siri area, for example, was estimated to contain 50MMbbl when production started in 1999. Weve produced110 MMbbl and still expect to have about 10 more years of strong production left, Gath said.

The recent Solsort North Sea discovery shows that theDanish sector still has viable prospects to be discovered.

DONG has increased its operating potential througha variety of successful partnerships with larger, moreexperienced operators. In the mid-Norwegian North

Sea, DONG holds a 10.3% interest in the landmarkOrmen Lange development project. The field, whichis 40 km (25 miles) long field and 8 km (5 miles) wide,showcased one of the worlds first subsea-to-beach produc-tion facilities from such deep waters. This field is pro-duced from the sea floor 120 km (75 miles) from shore.

Partnering in Ormen Lange gave DONG assurancestoward developing similar projects. As Totals only partnerin the Laggan-Tormore development offshore West of Shetlands, DONG holds a 20% interest. This develop-ment, which is being called a mini-Ormen Lange, willexceed the record set for subsea-to-beach production by

producing through a multiphase system 143 km (89miles) to shore.

Frontier player? While DONG has proven its viability close to its nativeDenmark, the company is not opposed to moving out fur-ther. It is active in two frontier areas, including the BarentsSea and offshore Greenland. We will be drilling our first operated well in the Barents Sea in November this year,Gath said.

In Greenland, which Gath considers to be a true fron-tier, the company has participated in exploration activi-

ties since 2000, when it partnered with Statoil on the Fylla well. The company now holds two licenses: one in partner-ship with ExxonMobil and Chevron and another withConocoPhillips.

The companys strategy is to operate in areas where it has an understanding and has competencies to bring tothe table such as in the North Sea. We would like to becapable of doing anything, but our size provides some lim-itations. Our goal and our strategy in frontier and areas

with huge challenges is to become a strong and coopera-tive partner to larger companies that have more experi-ence, Gath said.

DONG expects to see about 10 more years of strong production

from the Siri area, which has delivered 110 MMbbl of oil so far.


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There are many factors challenging the industry today.Domestically in the US, there are concerns withuncertainty from Washington DC and the fallout fromthe Macondo oil spill and subsequent moratorium onoffshore drilling. There is a shortage of young peopleentering the oil and gas industry at a time when the

workforce is reaching retirement age. Globally, there hasbeen a trend toward increasing demand for oil and gasin the face of a decline in exploration over the last 24months. And political unrest in major producing coun-tries in the Middle East has made countries that arereliant on hydrocarbon imports uncomfortably aware of their vulnerability. In the face of all of these challengesis the demand to reduce time to deployment despitehigher-than-ever development costs.

This situation is compounded by the do more withless mentality that is so ingrained it is hard to thinkabout innovative ways to tackle these issues.

The good news is that technology can help ease thepressure. Collaboration tools have come of age and holdthe promise of addressing many of these concerns and

very cost-effectively.

Technologies, networks mature Videoconferencing has been around for years. While it

is a well understood technology, the endpoint productshistorically have been costly. Most products only liked totalk to the same brand of equipment worldwide, andthe major expense was the cost of a quality network. Incertain parts of the world, high-speed circuits simply

were not available.Both sides of the equation have changed dramatically

in recent years.Conferencing equipment is largely standardized,

and pricing for endpoints have dropped significantly.Newer products also use bandwidth much more effi-ciently than products produced as recently as five yearsago. The spectrum of offerings is impressive, rangingfrom basic, low-end offerings that are essentially free,to complete Telepresence suites that provide lifelikeHD experiences.

In the same time frame, options for high-speed Internet access have expanded, even in countries where it takes

years to get a telephone line. The same is true of offshorenetworks high-speed Internet is now an expectation onthe rig and one can take advantage of that to collaborate

with co-workers around the world, bringing the best mindson the planet together to make important decisions or tosolve a problem.

Baby stepsFor many energy companies the first use of collabora-tion and video tools was not initiated by the IT depart-ment. Individuals who saw the need took matters intotheir own hands and deployed webcams or handheld

video devices like Ciscos Flip camera and used freeproducts like Skype and Google Video Chat to shareinformation and collaborate. Every iPhone user can

videoconference and now expects to be able to do at least that in the workplace.

These low-cost entry level collaboration tools are sur-prisingly good and in many cases are free but for thecost of a webcam (most laptops and tablets today comeequipped with at least one camera whether buyers want it or not). When troubleshooting a problem on a rig,this approach may not be technically pristine, but it getsthe job done. Some of these free video chat tools aresurprisingly effective, and the price is certainly right.

Another option to consider is Microsofts Lync prod-uct, formerly known as Office Communication Services

Collaborative tools come of ageIn a resource challenged industry, leading companies are using collaboration tools to bringthe best minds together to make the best decisions.

Dave Jacobs , TechKnowledge Consulting Corp.


managementREPORT

Ciscos Telepresence is the market leader in the high-end video

arena. (Photo courtesy of Temple Webber Photography)


18/110

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(OCS). Most of the Lync functions are embedded inexisting Microsoft products. Many large energy compa-

nies already have some of these functions as a result of existing enterprise license agreements. Lync includeseasy-to-deploy Instant Messaging (IM) and video chat sessions and also can provide basic telephony servicesthat can be useful in settings where deploying a tradi-tional phone system is impractical.

Many energy companies spend thousands of dollars with third-party conferencing companies, unaware that conferencing and collaboration servers are cost-effectiveoptions. For any company spending more than $2,500 amonth with a third-party provider, a conferencing servermay make sense. They are available in a variety of config-

urations, but all replicate the basic bridging functionof a third-party provider, complete with controls for thehost. Many offer a collaboration tool that permits every-one on the call to view an image or document, and somealso offer video chat. The better offerings integrate withOutlook, providing conferencing as an option whensending a meeting invitation. Some alsooffer recording and archiving for those whocannot participate in the real-time confer-ence. One example is Avayas conferencingserver, which is part of the Avaya Aura prod-uct set. Webex can be an equally effective

method of collaborating and is available forpurchase as a secure corporate server or asan affordable pay-by-the-use service.

Cost-effective videoconferencing With high-speed Internet access available in much of the

world, the challenge of delivering a quality video circuit is to some degree resolved. An HD quality experiencemay not be possible everywhere in the world, but eventhe most basic Internet connection can provide a rea-sonable video experience. Consider how often news cor-respondents broadcast from a remote location using asatellite Internet connection not the most elegant

video quality, but effective nonetheless. While it is nice to see a persons face on the screen, in

many cases the purpose of a videoconference is not tointeract with an individual the more important aspect of the conversation is to collaborate and review a piece

of information, a seismic image, some interesting data. Video conferencing and collaboration tools provide theability to do that in HD, accomplishing most of theobjectives of a face-to-face meeting. Reduction in travelis appreciated by both employees and employers, but the real benefit is better decision-making and a substan-

tial reduction in the timerequired to make important choices. Mainstreamproviders such as Tandberg(recently acquired by Cisco),Polycom, and Lifesize offer

quality products that are sur-prisingly affordable. When the key objective is

personal interaction, Cisco,Hewlett Packard, and Poly-com offer very lifelike high-end conferencing systems.Ciscos Telepresence is themarket leader in the high-end video arena. The com-pany has deployed more than1,000 purpose-built Telepres-

ence rooms worldwide.Each provider offers a wide array of products, large and small, so even aremote location can participate costeffectively.

There is little doubt that the floodgatesare opening, and video conversations aresoon to be the norm. Although most com-pany IT networks are not prepared tomake the leap to video anywhere/any-time, the time to start planning anddeploying video is now.


managementREPORT

RIGHT: Most laptops and tablets today come

equipped with at least one camera. BELOW:

Videoconferencing has become standard

practice in many companies.


20/110

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Bringing a new offshore oil field into full productionrequires timely and accurate decision-makinginformed by current conditions. Without proper real-time surveillance, however, new fields can be hamperedby uncertainty especially during start-up periods,

where rapid assessment of field operations and produc-tion conditions is critical to maximizing production.

Ensuring optimum production is not simply a matterof building the infrastructure, installing equipment, andflipping a switch to begin operating. New fields requirethe right combination of technology and planning at every step of the process. Without adequate means toobtain critical information, the process can be long,cumbersome, and ripe with the chance of er ror.

Potential pitfallsExploration and development company Ithaca Energy is

well aware of this and is taking the necessary steps tominimize improvisation in the development of the new

Athena oil field offshore Scotland. The Athena oil field a joint venture among Ithaca Energy, Dyas UK, EWE,and Zeus Petroleum expected to produce approxi-mately 22,000 b/d of oil at startup. Field operator IthacaEnergy sought the latest monitoring technology avail-able to help with well management and surveillanceand to ensure optimal production processes. To ensureexpedient startup and maximize production, IthacaEnergy needed to find the right mix of technology to

help personnel spend less time gathering data and moretime meeting the organizations operational objectives.

The company needed technology that would providereal-time insight into processes and performance to com-bat the uncertainty and inaccuracy that often impede theprocess of bringing new fields onstream. In addition, oilfields are frequently subject to variations in well perform-ance, artificial lift variables, topsides process conditions,and other factors. These, in turn, can cause large fluctua-tions in total production. Also, process data obtained

in these conditions is frequently subject to flat lines,dropouts, and errors that require cleansing for properand accurate data processing.

Well rate estimations require calculations and correla-tions using accepted first-principle methods, and thesemust be adjusted and recalibrated according to fieldconditions. The resulting estimations must then be pre-sented clearly and accurately to decision-makers andin a format that allows them to consult with their peersand respond to situations in a timely manner.

Digital advantages

The Athena oil field required technology that wouldaddress these factors as much as possible while ensuringoptimal production. Ithaca Energy found the answer toits requirements in digital oil field management technol-ogy for the flexibility and control it offered. Central toachieving this was selection of well surveillance softwarefrom Honeywell Well Performance Monitor (WPM)

which provides an easy-to-understand, real-time snap-shot of key operations through one information hub,helping key personnel and decision-makers visualize theperformance of the entire field.

For Ithaca Energy, choosing the Honeywell WPM soft-

ware was the first step in the process toward establishinga digital oil field on Athena. The next stem was theimplementation process, which entailed determiningthe proper approach as well as the appropriate phasesand structure of the system. Working with Honeywell,Ithaca Energy took a vertical (from data sources to end-user visualization) and phased approach to deployment,implementing an adequate amount of functionality at every automation/IT layer to achieve the business objec-tives, but allowing room for growth and adaptationbased on potential new objectives and future levels of functionality.

digitalOIL FIELD

New technology optimizes operationsThe Athena field is powered for performance.

Joel Chacon , Honeywell Process Solutions

Honeywells program allows engineers to monitor ESP perform-

ance to better manage production. (Images courtesy of Honey-

well Process Solutions)


22/110

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From a timing perspective, the phased implemen-tation eliminated costly uncertainty and guessworkduring the ramp-up period of the new field and

ensured Ithaca Energy would have a fully tested sys-tem available when the field came onstream. It alsoleft room for future growth and improvement.

Once the field is on production, the WPM system will enable the engineering team to monitor how the Athena wells are performing compared toexpectations. To complement the WPM system,Ithaca Energy also selected an out-of-the-box mod-ule for Well Test Validation from Honeywell, furthersupporting the objective of establishing optimal wellperformance conditions.

Taking a three-phased approach, the operator first

established system requirements and developed ageneral design for the integrated system. At its core,the Athena field development is producing from

wells in which production is being boosted by electricalsubmersible pumps (ESPs). Engineers sought to auto-mate the well production test capture, analysis, and vali-dation process, so Ithaca Energy formed the projectsmain objectives around the set of functions as applicableto ESP wells, and by modifying WPMs Well Test Valida-tion module, as required, to achieve those objectives.

Honeywell helped extend the Well Test Validationmodules functionality to cover specific model-based val-

idation steps on the well. As part of this activity, the tech-nology provides suggestions of possible well modeladjustments to match recent well tests.

Using the module, production engineers can quickly calculate and recalculate well test results based on stableprocess variable averages to capture valid well tests evenprior to creating the well test record. If the well test isdeemed valid, the system executes a match with the wellmodel and suggests potential adjustments. This providesengineers with the level of detail necessary to accurately determine which parameters actually require modifica-tion. The engineers have the final word on what well

model adjustments require changes or if a new well test is required to validate the results of the analysis.

Visual models will help predict what each well is capableof producing. The WPM technology can extract summary information and key performance indicators from real-time process data historians, production databases, andengineering well models, allowing operators to visualizefield performance data and manage equipment assets.This picture shows where shortfalls in production areoccurring so engineers can take immediate steps to cor-rect them and maximize the production potential of each

well. WPM also helps personnel manage costs associated

with surveillance by enabling engineers to identify abnor-mal situations quickly and react rapidly to disturbances.

Because of the systems flexibility, Honeywell is help-ing Ithaca Energy use the system to automate as many routine actions as possible to free personnel to focus onmore complex tasks and decision-making. By enablinggreater automation, the system saves engineers time

while providing them with the detailed insight neededto make sound, informed decisions that ultimately affect

well performance.

Fine-tuned performanceThe second stage of implementation entails deployingthe software in a simulated environment, which isenabling operations managers to test the system, trainpersonnel, and fine-tune processes so they can be asfully operational as possible when the wells begin to pro-duce. This is especially critical because the oil field isbeing developed concurrently with the system.

In the third stage, Honeywell will work with IthacaEnergy to ensure a smooth changeover to the produc-

tion environment. This involves working with the systemusers and adjusting the softwares calculation and esti-mation methods to reflect actual field conditions soengineers can access critical real-time information topinpoint underperforming wells and help improve col-laboration throughout the team. When the changeoveroccurs in late 2011 and the wells start producing, Hon-eywell and Ithaca Energy expect the preparations cou-pled with the advanced technology capabilities willensure the Athena oil field is running optimally fromday one and that it continues to perform efficiently longinto its future.

digitalOIL FIELD

WPM will provide the operator with a real-time snapshot of key opera-tions on the Athena field.


24/110

E &P companies today are very knowledgeable about identifying and investigating best-in-class technology resources that support the demanding core tasks that theirbusiness requires. These requirements include some that are unique to the oil and gas industry and thus extend

beyond conventional business IT requirements includingseismic interpretation, wellpath planning, and the trans-fer/availability of extremely large data volumes that sup-port multiple areas of exploration and mapping. Allof these are tied to improved workflow performance, which means reducing the amount of time and resourcesrequired to assess, deploy, and manage projects that deliveroptimal results. Efficiency and productivity are criticalrequirements for the bottom line.

Inherent to optimizing workflow performance is theability to identify and leverage top-tier data environmentsthat not only support but enhance productivity and effi-

ciency while ensuring 24/7 security and reliability. Somecompanies are recognizing the value of scalable, sophisti-cated data center environments.

Petroleum Geo-Services (PGS) is one such company that stands at the leading edge of this trend. It reposi-tioned a significant portion of its IT infrastructure toCyrusOnes Houston West data center several months ago.David Baldwin, service support manager at PGS, notedseveral areas of performance that convinced him and hiscolleagues that a co-located environment was the best option for the company.

Cost efficiency is paramountThe most important factor CyrusOne encounters is cost efficiency, namely reduced power costs. Over the past half-decade, IT teams have experienced a dramatic increase inpower requirements for data and network infrastructures.This is because the core hardware and architecture haveevolved very rapidly toward high-density data environ-ments in which power requirements have moved from

100 kW of power per sq ft to 300 kW/sq ft. Some high-density environments can reach 500 kW/sq ft. Managingpower requirements and projecting budget outlays forever-increasing power needs becomes more difficult andunpredictable as these requirements continue to escalate.

IT teams have three core options build a data center,retrofit an existing center to meet current and futurerequirements, or co-locate with a hosted data provider.Build vs. buy analytics clearly indicate that co-location isthe best option in many cases.

CyrusOne reviews the various scenarios with prospectiveand current customers on a regular basis. The most

underrepresented factor when IT teams conduct theirown analysis is power requirement. As previously men-tioned, it becomes more difficult to execute this analysiscorrectly when confronted with power consumption met-rics that increase rapidly and continuously over a short period of time. This years budget will not be next yearsbudget; that much is certain.

A company that wants to build its own data center must consider the most advanced and scalable power supply architectures to ensure the facility will adapt to futuretechnology, increased space, and growing electricity requirements. This is an expensive undertaking to say the

least a high-density data center built to meet the most advanced and most flexible specifications will exceed US$500/sq ft for a 10,000-sq-ft build. Economies of scalebecome critical at this stage of decision-making. A co-located data center is built to house multiple customersacross a much larger and more dynamic architectural foot-print, thus distributing and mitigating both cost and risk.

Because of the nature of data center business and opera-tional models, top tier co-located data centers are designed

EPmag.com | October 2011 23

digitalOIL FIELD

Data environments prove viablebest option for E&P customersCo-located centers help ease IT headaches.

Kenneth Wolverton , CyrusOne

Having several customers in one facility provides economies of

scale for power consumption. (Images courtesy of CyrusOne)


25/110

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digitalOIL FIELD

with advanced 2N and N+1 architectures that deliver optimal power efficiency and uptime reserve in addition to superior power and ambient environmental

control within the center. Because of this advanced architecture, CyrusOne isoptimally equipped to predict and manage power consumption needs across theentire facility, accommodating power requirements on a per-customer basis fromthe lower end of the scale (150 kW/sq ft) to the upper limit (500 kW/sq ft).

Reduced infrastructure managementOil and gas companies want to focus less on managing data infrastructure,including routine maintenance and iterative processes, and focus more on corecompetency and business-facing workflows. But for many IT teams, a large pro-portion of their workload is spent executing routine tasks in the name of quality control and supervision.

Co-located data centers are able to offload routine maintenance and tasks

without sacrificing peace of mind. In fact, this is another area that PGS cited as aprincipal factor in its decision to migrate to co-location with CyrusOne. Leverag-ing intrinsic on-hand expertise is a fairly easy decision for many customers.

Additionally, many co-location providers offer training to further enhance theefficiency and effectiveness of client work teams. Some clients prefer to manageall or most workflows themselves, while others carefully choose select processpoints at which to directly engage. In either scenario, on-hand training offers

valuable insight and improved techniques for managing and coordinating criti-cal pieces of the data infrastructure puzzle.

Future-proof scalabilityThe third component that all customers appreciate is a forward-designed data

center environment. As requirements and architectures change, and as hardwareand network protocols change, the data center remains ahead of the curve at every stage, and customers can scale their respective infrastructures accordingly.

Co-located customers can adapt and alter their data infrastructures as needed without headaches or bottlenecks. This arrangement aids greatly in planningbecause customers can reliably predict and anticipate next years budget with agreat degree of certainty. Like most top tier co-located data centers, CyrusOneanticipates change based on innovation models and advances in technology andcan thus ensure seamless upgrades and modification of existing systems and com-ponents. The technology curve is an elusive thing in many respects, but throughexpertise and a deterministic approach to future needs, CyrusOne ensures its cus-tomers are empowered to stay well ahead of this ever-shifting curve.

Another important aspect of remaining ahead of the curve is the ability toremain fully compliant with environmental standards and/or mandates, whichcan vary widely between regions. Any top-tier co-location provider should remainfully abreast of all environmental control factors and maintain full compliance at every required stage.

According to Baldwin, this feature of the CyrusOne value proposition gavePGS great confidence in consolidating the bulk of its IT infrastructure within theHouston West data center. You have to be certain that the new environment is a

better and more secure environment and that it can bemanaged and adjusted as needed without complicationand with the full certainty that no interruptions, only improved performance and efficiency, will occur.EPmag .com

READ MORE ONLINE

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O perators in North Americas shale plays are increas-ingly relying on microseismic information to deter-mine fracture length and orientation during hydraulicfracturing operations. This understanding often impactsthe location and orientation of future wells.

In a proposed geothermal project in the UK, informa-tion from the seismic around the first well will determinethe exact location of the second well. Once again, its allabout the fractures.

The Eden Deep Geothermal Energy Project in Corn-

wall is an ambitious attempt to tap into the heat buriedbeneath the granite in the area. The CornubianBatholith, sort of a granite spine in Western Europe,brings geothermal heat closer to the surface and lowersdrilling costs, according to Edens website.

The idea is to drill a 4-km to 5-km (2.4-mile to 3-mile)borehole into the granite, where it will encountertemperatures of about 180C to 190C (356Fto 374F). Water will be pumped into thisborehole to open up natural andinduced fractures in the rock.

Borehole seismic sondes developed

by DJB instruments will be deployedaround the borehole. The sondes canbe buried to 400 m (1,300 ft) deep, donot need a clamping mechanism, andhave large accelerometers and low-noiseamplifiers to provide a very high output and make them sensitive to small signals.

The accelerometers, according to DJB litera-ture, have a larger bandwidth than geophones andseismometers, facilitating additional analytical treatment such as source parameters.

The sensors also have very low power consumption

and can be operated from a car battery. The sondes willbe triangulated to find the exact locations where frac-tures are opened and then slipped by a shear mecha-nism. By imaging this location, the second boreholecan be sited.

The sondes monitor whats happening in terms of the water and the movement of the rocks, said PaulHunter, managing director of DJB. Weve supplied sixsondes to the Eden Project, and they will be put aroundthe perimeter and keep monitoring and measuring

whats happening.

Its important to drill into these open fractures

because thats where the magic of geothermal comesto bear. Water pumped down the first borehole will beheated, transferred to the second borehole throughthe fracture network, and sent back to the surface assteam to provide electricity.

Eden Project participants have partnered with ESGEnergy to build the facility to generate both

heat and electricity. The site is located in aparking lot and has been sanctioned by

the Cornwall Council. When complete, it should have a

capacity of 3 MW to 4 MW of elec-

tricity and should be able to gener-ate about 95% of the time. Itsexpected to supply enough elec-tricity to support 3,500 households

as well as some heating capacity.An ESG plant is very efficient when

compared to many other systems, the website states. Around 30% of the power

created by the plant will go back into pumping water around the system, so it can be said to beabout 70% efficient overall.

Covering an area about the size of a rugby pitch,

the plant will run 24 hours a day, more than 345 daysper year, and is expected to come onstream in 2013.DJB, meanwhile, is already developing its next

generation of sondes to operate at greater depthsand temperatures.

Might there be applications to oil and gas opera-tions? Only time will tell.But any device that can soaccurately pinpoint openfractures is certainly wortha look.

Seismic leads the way for geothermalSondes identify exact location of open fractures.


RHONDA DUEYSenior Editor

[email protected]

27

explorationTECHNOLOGY

EPmag.com | October 2011

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m e n t s


29/110

EVO LVE IN EVOLUTIONiI I n I C V n C / T C I 1 \ A / AV C

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wellCONSTRUCTION

I t was no surprise that Offshore Europe this year wasonce again jam-packed with new and trusted tech-nologies being applied in the North Sea and abroad.The Aberdeen, Scotland, event was well-attended,and the options for things to see were many.

One of the more interesting technologies wasexhibited by a hometown company, Aberdeen-basedDeep Casing Tools, which had on display its new Tur-

borunner. The turbine-based tool is designed as ahigh-speed reaming system that enables completionsto be landed at target depths, especially in areas likethe Saxon field in the Central North Sea, where bore-hole stability can be a significant challenge due to theoccurrence of interbedded shale layers.

In addition, horizontal openhole sections often areinterspersed with reactive and collapsing clay layers.These conditions combine to provide a very challeng-ing environment for landing production liner at TD.

In a recent project, there were problems with aplanned well design that involved drilling an 8 -in.

hole from a semisubmersible, then running a 75

8-in.predrilled liner 1,000 m (3,000 ft) horizontally to2,650 m (8,700 ft) TD. This proved difficult, and the

completions team opted to sidetrack the well with alarger 9 -in. horizontal drain to give a new predrilledliner a better chance of reaching TD. String rotation

was not an option due to the limited torsional yieldstrength of the flush joint connections being used. A single-run PDM motor also was not viable due to therisk of a pressure spike on stalling or starting, whichcould set the liner prematurely.

The Turborunner made sense because the stand-pipe pressure actually drops as the tool is loaded orstalls, which proved to be a significant operational

advantage. The tool was used to wash and ream theliner to target depth within a 12-hour period. It recov-ered 1,000 m of open hole, accessing 530 m (1,750 ft)

of net pay. It was operated at circulation rates up to7 BPM, with 400 psi across the tool and a stand-

pipe pressure of 900 psi.The tools unique design combines high-

speed rotational reaming with very low oper-ating pressures. The turbine design allows

RPM to slow and even stall without any reactivemechanical torque, nor does it cause uncontrollablepressure spikes. The reamer shoe is the only part that

rotates, so the completion string and any complexcompletion equipment remain stationary with a needto rotate.

In theory, this tool operates as if there was a drillbit on the end of the completion string. In many cases, it could provide the best technical shot in land-ing difficult completion strings.This tool has been used prima-rily offshore, but it will most likely debut in land develop-ments very soon.

A new twist on an old problemA new turbine-based technology is providing affordable insurance ontroubled wellbores.


TAYVIS DUNNAHOESenior Editor

[email protected]

EPmag.com | October 2011 29

In theory, this tool operatesas if there was a drill bit

on the end of thecompletion

string.In many

cases, it couldprovide the best

technical shotin landing

difficultcompletions

strings.


31/110

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