Automating Operations: Oil and gas companies derive cost benefits from technology use

Oil and gas companies derive cost benefits from technology use

The process of extracting crude oil and gas has undergone a sea change. From time to time, technological advancements have been incorporated into the sector, a trend that has gradually brought these processes to their current state – a high-level of technological sophistication as well as predictability. The growth trajectory of the hydrocarbon industry, thus, has showcased an inherent dependence on technological progression.

The trend is consistent in the current times too. Given the intense competition, complex macro settings and climate change concerns, oil and gas players across the globe are looking to protect their margins while keeping business viability intact. In fact, many are turning to technology-driven solutions. In this pursuit, automation is making major inroads into the oil and gas business. In broad terms, automation means replacing human labour with advanced machinery in a given process. With a move towards Industry 4.0, the petroleum industry, like many other sectors, is placing its bets on the automation of operations to shave off operating costs.

The need for automation

With upstream operations becoming more automated, concepts such as digital/automated oil fields, integrated operations, smart fields, intelligent oil fields, and artificially intelligent operations are emerging as the new normal in the oil and gas circles. Implemented with the objective of trimming down the cost per barrel of oil produced, automation involves the deployment of real-time monitoring, surveillance, and analytics solutions at oil and gas wells.

The obvious need for automated solutions arises from the increasing difficulty in hydrocarbon extraction from ageing fields as well as the increasing depth of reserve deposits (most of the shallow reserves have already been extracted). Greater depths also present geological challenges, thereby rendering the operations more complex and risky.

Key applications in oil and gas field operations

Some of the key automation solutions that are increasingly finding use in the oil and gas industry are:

  • Digital oil field (production data management system or PDMS): The deployment of PDMS provides key performance indicators for a business. It also presents data in easy-to-understand visualisations and dashboard displays. The system has drill down and diagnostic capabilities, and ensures transparency across the organisation by enabling the viewing of real-time operations’ data vis-a-vis historical data. The key benefits of PDMS are automated data capture, allocation of wells, reporting and plant parameter monitoring, zero dependency on personnel, accurate and authenticated data reporting, and performance monitoring of critical equipment.
  • Corrosion monitoring system: Usually, the inspection of pipelines is carried out manually thus requiring costly scaffolding set-ups. The approach is cost intensive as well as unsafe for workers, as has been seen in many cases. Guided ultrasonic monitoring of pipeline system (GUMPS) is an automated solution to this problem and assists in the real-time corrosion monitoring of pipeline networks. A single unit of GUMPS acquires data from about 60 m of pipeline and aids better decision-making (based on the corrosion growth recorded). The benefits of GUMPS include a reduction in inspection and resource costs, a reduction in accidents, improved pipeline surveillance and a general increase in the shelf life of pipelines.
  • Satellite fields production optimisation: There is a need to monitor the parameters of wells and plants of a satellite field at regular intervals for better decision making. For this purpose, edge devices are deployed at key locations to help in data acquisition and transmission to the cloud server. Through edge devices, sucker rod pump operations can also be monitored and analysed for optimising production.
  • Seismic data on cloud: The prevalent practice of storing seismic data in tape drives is proving inefficient, as these drives are becoming obsolete. This has given rise to the practice of uploading seismic data on the cloud for automated cataloguing, geomapping, georeferencing, and conducting quality checks. It does away with the need for maintaining tape copies/drives, while enabling efficient data cataloguing free from human error.
  • Integrated exploration and production (discovery) platform: The deployment of this platform reduces the operational costs through the integration of diverse technical data sources on a web-based geospatial destination providing single point of access, smart search, and visualisation of multi-source data. The platform increases the quality and transparency of data as well as facilitates a collaborative business process.
  • Drone-enabled surveillance: The safety and protection of the pipeline networks is important both from the perspective of the organisation and the surrounding environment. Usually, the pipeline networks are spread over large areas. In some cases, the areas they cross are hard to reach due to several challenges. This makes the inspections (even if only visual inspections) extremely difficult, costly and time-consuming. The use of emerging technologies in unmanned aerial vehicles (UAVs) helps to improve survey and monitoring of pipeline operations by reducing costs and increasing safety, efficiency and the speed of process. Drone-enabled surveillance technology comprises UAV, artificial intelligence, internet of things, analytics, and other hardware and software tools.
  • Fuel monitoring of production support vessels: Often, there are problems associated with tracking/monitoring the consumption of fuel in production support vessels (PSV) deployed for offshore platforms. Data acquisition hardware is usually deployed on the PSV, which gathers data from digital flow meters and uploads it on the cloud-based web server. This helps in GPS tracking, as well in monitoring engine fuel consumption, speed, the distance travelled, etc.

The way forward

A number of oil and gas companies in India such as Oil and Natural Gas Corporation Limited, Oil India Limited, Bharat Petroleum Corporation Limited and Hindustan Petroleum Corporation Limited are increasingly opting for automated solutions to reduce costs. However, this trend comes with its inherent challenge of increased threat to asset integrity, as seen in the recent drone-guided attacks in Saudi Arabia’s oil producing facility. While technology-driven solutions have benefits, it makes sense for companies to also invest in research and development to devise solutions that guard against threats. From the investment point of view too, there is a strong case for this, as automation is an investment-heavy decision, even though it pares operational cost in the long run.