Although the oil and gas industry has endured fluctuations in economic cycles, we have continuously innovated. This innovation has happened in all aspects—including exploration, drilling, completion and production—to produce hydrocarbons in the most effective, efficient way.

For example, operators in the past have drilled more wells to increase production. Despite recent methods for efficiency gains, such as pad drilling, this approach is no longer economically viable. Our industry has also devised intelligent completions, which largely drove the production renaissance in the US. Now we must explore different methods in other lifecycle segments to increase production and reduce costs.

Industry 4.0

Digitalisation provides a foundation to improve efficiencies and drive operational performance. For decades, digitalisation has been prevalent in oil and gas, but the paradigm of Industry 4.0 has drastically changed our thinking.

Industry 4.0 entails linking technologies to communicate with each other and make decisions without human involvement. This concept has already reshaped many other technology-driven industries and is now transforming the oil field. In fact, it has opened new avenues of exploiting our most valuable asset—our data. It has also introduced efficiencies in accessibility and computing.

Various components make up Industry 4.0. First, IoT, or the Internet of Things, links groups of physical devices for remote monitoring and control. Second, cloud computing reduces technology infrastructure and enables data to be accessed from anywhere. Edge computing, meanwhile, connects intelligent devices to current and historical data for autonomous decisions at a remote site. And finally, advanced analytics brings these four concepts together to an interconnected, intelligent ecosystem that merges the digital and physical worlds.

How does this relate to our work in the oil field? By now, many companies routinely think about their assets beyond a single well. IoT accelerates that level of thinking to the entire field and enterprise levels by using technologies—such as our ForeSite production optimisation platform—to connect and integrate oil field equipment at scale. The resulting network increases access to data, broadens the scope of viewable data, and drives systematic efficiencies for faster drilling, more barrels and less cost.

Cloud computing helps to connect with data in a fast, direct and meaningful way. Our industry generates vast amounts of data, and the cloud lets us access it, from high-resolution logging-while-drilling measurements to years of archived rod-pumping data.

Edge computing helps us to transfer intelligence and lower-level decision-making directly to the wellsite. As a result, your best engineers have the freedom to work on top-priority projects while autonomous computing handles the day-to-day management of processes.

Advanced analytics is the holy grail. With this component, a single user can see an entire enterprise by function, asset, well or any other level. The user can access and match each job or function to the thousands that preceded it. Oil field machinery, largely limited to mechanical function for the past century, acts as an intelligent machine that learns and teaches itself how to increase efficiency, predict failure and manage assets by exception.

Catching up

Our industry is typically slow to adopt next-generation digital technologies. However, surveys today reveal a significant increase in digital investment to improve revenue and reduce costs, as highlighted by Accenture’s 2017 Upstream Oil and Gas Digital Trends Survey. A recent announcement revealed that Abu Dhabi National Oil Company (Adnoc) has adopted blockchain technology to reduce the time taken to execute transactions between its operating companies, increase operational efficiencies across its full value chain, and improve the reliability of production data. Many national and international oil companies have already started exploring data analytics and artificial intelligence to improve their drilling prospects and improve production.

At Weatherford, we apply artificial intelligence (AI) and automation to different well stages. In well construction, we use AI in place of error-prone human judgment for safer, faster connection makeup operations compared to conventional methods. Vero automated connection integrity helps to reduce makeup issues and the associated annual costs, which could be multimillion-dollars. On the production side, we have started adding IoT features to our next-generation automation controllers to provide autonomous optimisation and control.

The shift to automation and digitalisation will help us to not only advance oil field operations, but also fill holes in our workforce. After going through a series of downturns, we have a huge talent gap. Now we have the opportunity to seek out new talent and create a workforce that strikes the right balance between technical and technological brainpower. While traditional oil and gas disciplines such as engineering are critically important, we also need expertise in digital operations, software engineering and data science.

Digital technology will play a significant role in our future. As an industry, we can turn to digitalisation in research and development, manufacturing and operations to safely produce more barrels for less cost. This path forward will help to drive meaningful results for our customers and productivity in the oil field.

Mark McCollum is the president and CEO of Weatherford International

This article is extracted from a report produced by MEED and Mashreq titled Disrupting Oil & Gas. Click here to download the report

To know more about the MEED Mashreq Partnership, get in touch with us at MEEDMashreqPartnership@meed.com or find more info on www.meedmashreqconstructionhub.com