Harnessing the power of technology

In order to gain a better insight into this area of operations O&G’s Julian Rogers speaks exclusively to Dr Matthias Bischel, VP of Exploration and Production Technology, at Shell.

O&G. Firstly, can you outline how technology has changed the landscape of upstream operations since you joined Shell back in the early 1980s?

MB. Shell has always been at the forefront of developing and applying new technologies. Having joined Shell after receiving a PhD in earth sciences, I spent my formative years in technical capacities, mainly related to exploration. During this time I came to appreciate that having proprietary technology is a key differentiator in the upstream operations, and that this creates huge value through its application. Technology has changed the upstream landscape in every discipline and has enabled us to be successful in many difficult environments, as we search, develop and produce hydrocarbons.

Technology has allowed us to push the geological and geographic frontiers, such as deepwater or finding hydrocarbons in ever more complex structural configurations. New drilling techniques coupled with solid expandable tubular technology for instance is allowing us to drill into pressure settings, that, when I joined Shell, we could only dream of. Some of the recent technical highlights for Shell are the improvement of seismic imaging and electro magnetic imaging (seabed logging), swellable elastomers to reduce water inflow, expandable tubulars, smart wells and smart fields, reservoir management and not to forget our state of the art drilling capability.

O&G. In your view, what piece of technology has made the biggest impact in the upstream sector in recent years and are there any future developments that you are exited about?

MB. First of all, there is no silver bullet in technology; it is all in the way we apply the many innovative technologies and link them to the experience and competence of people to bring it all together. It is about capturing and applying the right technologies in an integrated way to find and unlock hydrocarbons. Personally I am very excited about the developments with respect to maximising hydrocarbon recovery, where we combine EOR technologies with our Smart Fields approach. Furthermore I am impressed by technical solutions that push the boundaries further. For instance, our Perdido project in the Gulf of Mexico, where we are developing the world’s deepest spar in combination with novel lifting technologies. This follows the Na Kika cluster development in the Gulf of Mexico, where we also set many world firsts.

O&G. What are the key challenges that you face in terms of R&D and implementing new technologies into Shell’s E&P activities? How do you overcome these obstacles?

MB. R&D is well integrated into our company and closely works together with the different disciplines in the field to get new technologies from trial to implementation. The biggest challenge I see so far, is that it often takes a long time to bring a new technology from idea to commercial status. It might take up to ten years, with notable exceptions such as our swellable elastomers, which we commercialised in only four years from inception. One of the reasons is the considerable investment needed to take technologies to the market. For this reason we formed Shell Technology Ventures, a company that invests in new technologies and accelerates market uptake across the industry.

O&G. Your company is at the forefront of implementing Smart Fields technology with major projects in Brunei (Champion West field) and in West Africa (Nigeria and Gabon). Can you describe Shell’s vision of “smart fields” and explain why this concept has become so popular with E&P companies in recent years?

MB. The total value realised from an asset depends on how well it is managed throughout its lifecycle, from exploration to early development to maturity. The process of developing and producing a field creates vast amounts of data and information and, as information and technologies continue to improve, our ability to collect these data is steadily increasing. A major challenge facing the industry is how to use these data to optimise field development, reservoir management, and production, and to provide field managers with a degree of control that allows them to transform this knowledge into maximum value.

Smart Fields is Shell EP’s response to this challenge. In a nutshell, Smart Fields represents the move from periodic to continuous optimisation, and a shift in focus from point answers to integrated ‘big picture’ solutions. Smart Fields is not a standalone technology, which has been developed by a single team; rather, it is based on the integration of dozens of tools, skills, and workflows to improve the performance of core Shell assets in a structural and sustainable way.

O&G. From Shell experience of implementing and running smart fields what particular benefits can these high-tech infrastructures bring to an oil and gas company today? Can these so called “fields of the future” ultimately increase production on existing assets and reduce costs on new ones?

MB. Cambridge Energy Research Associates, Inc. (CERA), estimate that oil recovery and production rates could increase by, respectively, eight percent and 10 percent, ultimately and smart field technology is likely to bring down costs for a variety of reasons such as:

• Constant monitoring and being able to adjust e.g. injection rates, in much quicker ways than in the past.
• Faster decision making in collaborative work environments, where different disciplines work together real time in a seamless fashion.
• Smart Fields also offers remote operating models that are safer and more cost efficient.
  

However, Smart Fields is not a one-size-fits-all method. Each field and asset has its own unique features and challenges, and the appropriate level of smartness to apply will therefore vary depending on the specific situation. In green fields, elements of smartness can be built in from the start, and are designed to deliver maximum value on full life cycle basis. For brown fields, on the other hand, smart capabilities ought to be selectively applied according to their economic viability, and any Smart Fields implementation plan should balance costs with the expected remaining field life.

O&G. What are the key digital enablers that are used by Shell to make possible smart field operations? Are there any operational or technical challenges in implementing these solutions?

MB. Smart Fields has been a leader in applying and integrating new technologies in communication, sensing, control and automation, reservoir imaging, directional drilling and advanced modelling. To effectively operate a Smart Field means integrating these different technologies and establishing a collaborative work environment, where engineers from different disciplines work together to make the most appropriate decisions quickly. The advent of Smart Fields technologies means the end of the functional and discipline silos enabling the professionals in our industry to work seamlessly together. Seeing decisions being turned into fast and safe actions, which result in higher production and lower unit costs is extremely satisfying for all oil field professionals.

O&G. How does Shell achieve effective E&P data management and what future trends do you foresee in this area?

MB. With today's advanced computing power, telecommunications and our proprietary algorithms we can perform highly complex, precise and continuous measurements and interpretations. These advanced tools lead of course to enormous amounts of data. By managing this carefully we can achieve productivity and performance yields. This is particularly the case for subsurface matters, where we make aggressive use of advanced seismic and imaging techniques, and in the production arena where, as I mentioned before, we are applying Smart Fields technology for continuous measurement, data capture and optimization. The tools we use for data management are not particularly proprietary but what is indeed special in Shell is the way we use them, for example:

• The way we use standard data platforms to integrate across all disciplines.
• The way we use it to collaborate real time to optimize performance.
• The way we can rapidly locate all data for a particular geographical point on the map and be assured of its data quality and completeness.
  

To achieve this, our Information Management (IM) professionals use very decisive data management procedures and methods developed over time to a point where IM is today an essential technical and professional discipline.
Going forward, I see the explosion in data further expanding rapidly. I see more automated sifting and monitoring of data and intelligent optimizations on a real time continuous basis. And I see the IM profession becoming increasingly technical and deeper.

O&G. Shell’s E&P work is focused in varying environments both on- and offshore. What kinds of cutting-edge technologies is your company currently developing to handle the complexity of different conditions?

MB. There is a need for technological solutions to find and recover more hydrocarbons whilst shifting towards increasingly more challenging environments such as ultra deep water. The development and application of our technology needs to be focused on improved efficiency – both increasing the amount of hydrocarbons we access as well as the amount we recover- and on effectiveness – the need to reduce costs without cutting standards and technical integrity.

Within our R&D programme we currently have a number of very exciting and promising projects, which will position our EP business for future growth.

Besides the development of technologies to unlock unconventional hydrocarbons such as heavy oil, tight gas and oil sands, Enhanced Oil Recovery (EOR) is one area where technology development is strongly positioned in our portfolio.

Over the last 30 years we have gained a lot of experience in gas (CO2) flooding, thermal and chemical EOR which has proved very helpful in applying it in different fields around the world, such as steam injection in the South Belridge field in California, which led to world class recovery rates of up to 80 percent. We are currently developing EOR projects in the Middle East that cover all major EOR technologies; miscible gas, thermal and chemical. These are exciting projects that allow us to recover more hydrocarbons, extending the field life and generating additional income for the resource owners.

Smart Fields is a registered trademark of Shell