Embracing the communications revolution

While the communication requirements for the oil and gas sector are generally the same as any other industry, there are some intrinsic differences that set it apart. Certainly the environment in which many oil and gas firms operate is a critical consideration. Platforms, pipelines and rigs often function in harsh or remote environments. And not only must the telecom technology be robust enough to survive the inhospitable conditions but it must also be reliable to ensure that those working on-site can operate both successfully and safely.

“In terms of the research and exploration of new fields, there is an increasing tendency to go deeper and deeper into the sea and to more distant areas with harsh environmental conditions,” highlights Alcatel’s Energy Market Director, Stephane Terranova. “This is combined with a shortage of skilled personnel to operate all of the fields. And so we are noticing a trend in these companies ensuring that their remote operations have an inland operation and these obviously need to be based, in both cases, on a reliable communications system.”

“The main thing for a lot of these oil companies is lift cost – how much does it cost to get one barrel of oil out of the ground,” adds Mike Rust, Client Delivery Executive, Telecoms, at EDS. “They are measured against each other in the open market in terms of how good their lift costs are. Communications is an enabler to lowering those lift costs. If communications are strong, they can cut the lift costs by a huge margin.”

But while reliable communication is a prerequisite for efficient operation and health and safety, it is also increasingly important in a broader corporate sense. “The whole path from the flow source through to the actual selling is now inextricably linked in such a way that as soon as the oil comes out of the ground the stock market is informed of what each oil company is producing,” continues Rust. “You still hear a lot of people talking about the reserves that firms have, but the actual flow of the material is now one of the key things that affects the stock price. Communication is the way that they get that information, whether that is by satellite, fibre, wireless of whatever. So communications is also essential in a broader picture that affects revenue.”

Lagging behind

With such a great deal resting on reliable communications from such challenging environments, it would be assumed that the oil and gas sector would have ensured that it had rolled out cutting-edge telecom services to address its needs. However, the sector has earned a reputation for being a slow adopter of new technology outside of its core business. And so it is with communication technologies.

“If you compare the oil and gas industry to other sectors in terms of deployment of technology to drive the business forward and gain benefits and competitive advantages, it is well behind industries such as financial services for instance,” suggests Stuart Robinson, Business Development Manager, Oil and Gas, Cisco Systems EMEA. “Oil and gas firms will potentially innovate to drive some benefits in the enterprise side of business. But when it comes to operations, it is step-by-step. In terms of investment in communications, it is lagging behind other industries.”

However, with rising communication demands, oil and gas companies are increasingly realising that their old legacy communication systems and infrastructures are no longer meeting their requirements. “They are often working with analogue systems, many of which have been installed long ago and which are operating in difficult environments and which are, in most cases, not using very advanced redundancy systems,” highlights Terranova. “This can create reliability problems and when you can’t communicate with the platform or get the information along the pipeline it means that you have to reduce or stop operation. This is costly.” There are also capacity and flexibility limitations.

“The industry needs to send more and more information on the communication pipe but most of the legacy systems are not able to cope with the increased flow of information in real-time,” continues Terranova. “Firms also increasingly want to put different kinds of applications on their communication systems, not only using communication for pure voice or data, but also SCADA and other applications such as video surveillance or leak protection. And for this you need to have a flexible system on which you can plug all these applications, such as a modern IP system.”

Rust has witnessed similar limitations in the sector. “In remote and harsh locations satellite bandwidth has always been a problem,” he explains. “In Russia, hitting some of the satellite providers is quite difficult so the links can be relatively slow. So they are limited by the speed of the link and also the reliability of those links. Even in a lot of the well-developed areas, they are still running on fairly old technology and these analogue systems are hampering their ability to move information around. And not only in standard communications, but also on board the offshore platforms – for example, a lot of the maritime and management systems to contact the Navy and the Coastguard are fairly old now, and a lot of these need to be developed now into new digital and wireless-based systems.”

Enhanced measurement

But after much deliberation on the part of many operators, an overhaul and upgrading of legacy communication systems is now under way in the industry. A total replacement of analogue with digital is being witnessed across the sector, while fibre backbones are being installed. Wide-band digital radio links and wide-band VSAT links are similarly becoming increasingly commonplace as the industry reacts to the new communication demands being placed upon it. And the benefits are already being felt amongst the earliest adopters.

“There probably would have been some 20-30 different networks inside a typical oil and gas company such as BP – all voice networks, all different PSTNs, utilising multiple sets of providers and carriers as it’s a global business,” says Robinson. “But now the networks are being converged, running multiple different applications over a single unified Ethernet network. So there is a move from PABX to a hybrid PABX to a pure IP converged Ethernet network, and then voice is run right across a global network. And that both takes cost out and delivers significant operational efficiency.”

In recent years, through the applied use of enhanced measurement technologies, there has been an exponential increase in well and pipeline data. To increase productivity, firms are ensuring that engineers, wherever they may be located, have real-time access to this data for analysis and immediate intervention. “Oil and gas companies have wellhead automation systems supported by a wi-fi network, which gathers the SCADA information integrated with a fibre optic backbone which brings the data to the control centre,” says Terranova. “So you are talking about a combination of wireless technology like wi-fi and WiMAX coupled with fibre optic terrestrial or submarine.”

Drawing on the real-time information and gathering it back on shore is being supported by the increasing amounts of fibre optic that is being laid in areas around the world. Transneft has reportedly been looking to upgrade to pure fibre optics from copper over the next ten years, whilst BT has laid 100 Mg fibre all the way around the Caspian Sea, connecting the wells in the Sea, with satellite links as a back-up. The huge bandwidth of fibre optic in particular is driving the emergence of on-shore control rooms or collaboration centres as firms look to reduce the number of workers on platforms. It costs US$600,000 to have one man on one platform for one year according to estimates, and so de-manning platforms will cut costs.

Safety solutions

Of course, fewer workers on installations is a benefit not only to the bottom line, but also in terms of safety. And the latest communications solutions are certainly impacting safety. “The application of CCTV cameras on high-speed links has meant that firms no longer need to send a team member out on a helicopter to check on a potential problem with fire on a platform, for instance,” highlights Rust. “Now they can put CCTV on the main areas and watch it on their behalf and tackle it in a different way. CCTV is also on the pipelines, and a lot of the data is now taken straight from the pressure areas on the pipeline and is transmitted back so that nobody has to go to these locations and take readings any more. So it is keeping the man as much away from the potential sources of danger as possible. There are also new wireless over Ethernet systems that allow ships to communicate better and beaconing systems that are digitised so that if someone goes overboard you don’t necessarily have to see them to know about it as you have automatic beacons that go off as soon as someone hits the water.”

With such modern applications gradually creeping into the sector, there are clear indications that the oil and gas industry is ready to cast aside its reputation as a slow adopter of new technologies and embrace the operational benefits. Modern telecom facilities are providing financial savings, improving quality, increasing quantity, increasing safety, enabling manpower reduction and improving the environment. Reliable telecom has always been critical to the sector, but as more firms adopt the latest and fastest communication technologies, the nearer we are to the tipping point where fully digital, high-speed, wide band services are a must to stay competitive.

Robinson believes we are already there. “I think we have hit the inflection point right now,” he emphasises. “Everybody has been talking about the oilfield of the future, the digital oil field, the e-field and smart operations for years. But we are now in a situation where we can actually provide deliverables.” “Now the oil and gas industry is taking the digital world very seriously,” agrees Terranova. “You only have to go to conferences and show to be convinced of this. And this is a trend that will continue. The main benefit for them will be optimisation of resources and being able to work in all these environments without having to put heavy resources on the spot. So the key words are: productivity, efficiency and security.”