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Emerging Upstream Technologies

IT Futures BriefingPresenter: Yogi Schulz

Emerging TechnologiesFor the Upstream

Oil & Gas Industry

29 April 2005 Copyright © 2005 Corvelle Management Consultants


Emerging Upstream TechnologiesManagement Consultants

Yogi SchulzBiography

� President of Corvelle Management Consultants

� Information technology related management consulting

� Project management and systems development

� Computing Canada & Calgary Herald columnist

� PPDM Association board member

� Industry presenter:

– Project World - 4 years

– CIPS Informatics - 7 years

– PMI - Information Systems SIG

– Convergence - 4 years

– PPDM Association - several years



PresentationOutline

� Presentation Objectives

� Quick technology retrospective

� Emerging upstream technologies

� Wild speculation about future technologies

� Conclusions

� Recommendations

� Questions & Answers



PresentationObjectives

� Recognize that most emerging technologies are influencing the oil & gas business

� Appreciate the pivotal contribution that technology makes to the oil & gas business

� Understand business benefits the emerging technologies can deliver in the oil & gas business

Presentation intended to spark an ideayou can explore with your co-workers



Quick Technology Retrospective

Turner ValleyDingman No. 1

Sightseeing at theLeduc Gusher

Leducdrilling

rig



Competitive EnergyTechnologies

� Wind

� Solar

� Hydro

� Nuclear power

� Cogeneration

� Conservation




� Sub-surface imaging technologies

� Geological characterization

� Enhanced oil recovery

� Direct hydrocarbon detection

� Advanced materials

� Computing hardware

� Computing software

Multiple corrosionfatigue cracks in carbon steeldownhole tool



Benefits Common to all Technologies

� Reduced costs/increased return on capital

– Finding, capital & operating costs

� Enhanced finding success

– Number of dry holes & marginal wells

� Enhanced production

– Production rate, total reserves recovered

� Reduced quantity of inputs

– Energy consumption, materials

� Reduced environmental impact

– Air, ground & water pollution

– Facility footprint

Revenue

$

Cost

$



Sub-surfaceImaging

� Description

– 3-D earth model with stereoscopic visualization

� Benefit

– Enhanced understanding of complex sub-surface structures

� Examples

– Reservoir characterization

– Drilling planning

– Reservoir modeling



Geological Characterization

� Description

– Remote sensing, aeromagnetics, seismic or geologic modeling to identify prospects in the targeted formations

� Benefit

– Accelerate prospect identification

– Improve production strategies

� Examples

– Paleochannel mapping forshallow gas exploration

– EOR modeling



Enhanced Oil Recovery

� Description

– Techniques to improve oil displacement or fluid flow in the reservoir

� Benefit

– Produce more of the in-place reserves

� Examples

– chemical flooding - alkaline flooding or micellar-polymer flooding

– miscible displacement - carbon dioxide or hydrocarbon injection

– thermal recovery - steamflood or in-situ combustion

SAGD - steam

VAPEX - hydrocarbon



Direct Hydrocarbon Detection

� Description

– Direct measurement of the volume of hydrocarbons

� Benefit

– Improve reserves estimates prior to drilling

– Avoid drilling interesting structures that contain no hydrocarbons

� Examples

– Multi-channel transient electromagnetics



Advanced Materials

� Description

– Materials with enhanced performance capabilities

� Benefits

– Better performance in adverse environments

– Weight reduction

� Examples

– Plastics

– Composites

– Catalysts

– Specialty steel

– Concrete



ComputingHardware

� Description

– Processor, memory, storage, network

� Benefit

– Improved information accessibility/movement

– Quick/reliable manipulation/integration of large amounts of information

� Examples

– Grid computing, low cost workstations

– Superconductivity in servers for improved performance

– High performance computing for enhanced interpretation models

– Self-healing, self-managing computing for higher availability

– Internet 2, satellite, Wi-Max, cell & sat phones for remote operation



ComputingSoftware

� Description

– Operating systems - Windows, Linux

– Application software

� Benefit

– Enhanced information management & analysis

� Examples

– Linux to reduce cost & improve performance

– Open source software to enable application customization

– Neural networks, intelligent agents



Wild Speculationabout Future Technologies

� Smart dust

� Hydrogen fuel cell

� Laser well drilling

� Nanotechnology for in-situ separation

� In-situ refining

“It’s tough to make predictions,especially about the future.”

Yogi Berra



SmartDust

� Description

– Autonomous sensing and communication in a cubic millimeter

� Benefits:

– Low capital cost

– Simple implementation

– Improved measurement and control



Hydrogen Fuel Cell

� Description

– Consume hydrogen as a fuel

– Fuel cells produce electricity

� Benefits:

– Clean burning

– No fuel shortage

– Quiet running

– High efficiency

– Compact



Laser Well Drilling

� Description

– Scale up laser drilling

– Heat fuses rock

� Benefits:

– No steel casing

– No formation damage



Nanotechnologyfor In-situ Separation

� Description

– Separate oil and gas from water and sediment using nanotubes

� Benefits:

– Produce only oil and gas

– No water disposal

– Small surface facilities

4 nanometers

1/10,000th of a hair



In-situ Refining

� Description

– Make shorter molecules

� Alternatives:

– Split with high-energy sound

– Metabolize with bacteria

� Benefits:

– Avoid high cost of steam, propellants

– Avoid high cost of refineries

– Increase ultimate reserves produced

Asphaltenes



Conclusions

� Emerging technologies are constantly changing and improving the oil & gas business

� Many technologies are under-exploited

� Example emerging technologies include:

– Sub-surface imaging technologies

– Geologic characterization

– Enhanced oil recovery

– Direct hydrocarbon detection

– Advanced materials

– Computing hardware

– Computing software



Recommendations

� Appreciate the pivotal role that emerging technologies play in the oil & gas business

� Maintain awareness of emerging technologies relevant to your position and career goals

� Adapt to the changes



Questions &Discussion



What’s next?Potential Future Topics

� Upstream Business Themes

– How much exploration & production software is enough?

– Linking IT investments in exploration & production to business value.

� Upstream Technology Themes

– Windows vs. Linux vs. UNIX – Desktop and server

– Convergence of voice, data, videoconferencing to IP

– Document and content management trends

– How much security is enough?

– Identity management

– GIS



1800, 250 - 6th Ave. S.W.Calgary, Alberta Canada T2P 3H7

Phone/Fax: (403) 249-5255E-mail: [email protected]

Web: www.corvelle.com

Information technology related management consulting

Project management and systems development

Computing Canada & Calgary Herald columnist

PPDM Association board member

Emerging TechnologiesFor the Upstream Oil & Gas Industry

Management Consultants



Short Course inPetroleum Chemistry and Refining

Road paving30 - 50Asphaltenes

Candles10 - 20Paraffin

Lubrication10 - 20Lubricating oil

Heating oil15 - 22Fuel oil

Fuel for trucks14 - 20Diesel

Fuel for airplanes10 - 14Kerosene

Base for petrochemicals5 - 12Naphtha

Fuel for cars5 - 9Gasoline

Electrical power generation1 - 4Methane to butane

UseNumber of carbon atoms

Fraction of petroleum



Bibliography- 1

� ABCs of Hydrogen and Fuel Cells

– www.eere.energy.gov/hydrogenandfuelcells/education/abcs.html

� Bacteria Eat Up Oil in Antarctica

– By Marcela Valente

– Argentine scientists are developing a biological process for combating oil spills in the extremely cold temperatures of the immense ice-covered continent

– www.tierramerica.net/2003/1215/iarticulo.shtml

� Bacteria, Underground Fires to Unlock Oil Reserves

– www.planetark.com/dailynewsstory.cfm/newsid/26247/story.htm

� Battelle Memorial Institute – Energy & Environment

– www.battelle.org/environment/whatwedo.stm

� Cornell researchers to kick-start fuel cell development with $2.25 million federal award to find new materials for cheap, efficient technology

– Oct. 31, 2003

– www.news.cornell.edu/releases/Nov03/Fuelcell.institute.deb.html

� The Digital future of Oil and Gas in a Life Cycle Perspective

– www.teknologiforlaget.no/ files/digital_future_-_dnv_software.pdf



Bibliography- 2

� Direct Hydrocarbon Detection

– Anton Ziolkowski, Bruce Hobbs and David Wright

– www.geos.ed.ac.uk/glg/research/cameos/petgsc01/

� Dust Networks

– www.dustnetworks.com/flash-index.shtml

� Emerging Technology

– Hart’s E&P, December 2004

� Emerging Technology News

– www.topix.net/business/emerging-tech

� Europe's Energy Future

– Copenhagen Institute for Futures Studies

– www.cifs.dk/scripts/artikel.asp?lng=2&id=1178

� ExxonMobil bets on high-tech approach

– Jeffrey Tomich, Bloomberg

– 4 April 2005, Calgary Herald, p. E5

� First Direct Hydrocarbon Detection and Reservoir Monitoring Using Transient Electromagnetics

– ior.rml.co.uk/issue2/articles/art-3.htm



Bibliography- 3

� The Folkecenter Wind-Hydrogen-Automobile Concept

– Poul Erik Bak, June 14, 2003

– www.h2cars.biz/artman/publish/article_179.shtml

� The Future of the Energy Industry

– www.globalchange.com/ppt2/energyforum5/

– www.globalchange.com/ppt/exxonmobil3

� Future of the Oil and Gas Industry: Past Approaches, New Challenges

– Harry J. Longwell, Executive Vice President ExxonMobil,World Energy, Vol 5, No. 3, p. 100

� Imaging Technologies Reduce Risks

– www.westerngeco.com/media/resources/articles/reduce_risk_ong.pdf

� In nanotechnology big things come from little things

– www.exxonmobil.com/corporate/newsroom/publications/TheLampSpr2004/story3.asp

� In Situ Recovery Methods for Heavy Oil and Bitumen

– Ron Sawatzky, Alberta Research Council, Edmonton, Canada

– www.cseg.ca/conferences/2004/2004abstracts/115S0217-Sawatzky_R_Heavy_Oil_and_Bituimen_Recovery.pdf

� JIVE - Joint Implementation of Vapour Extraction

– www.ptrc.ca



Bibliography- 4

� Molecular Manufacturing vs. Peak Oil

– crnano.typepad.com/crnblog/2004/11/molecular_manuf.html

� Nanoscience - a small-scale revolution

– www.npd.no/English/Emner/Ressursforvaltning/nano_teknologi.htm

� The Nanotube Site

– www.pa.msu.edu/cmp/csc/nanotube.html

� Offshore Technology Conference Recognizes Top Technologies

– May 2004, JPT Online

– www.spe.org/spe/jpt/jsp/jptmonthlysection/0,2440,1104_11038_2431164_2450251,00.html

� Oil [Price] Spike's Tech Impact

– Rising gas prices might convince Americans to stop buying SUVs, and give the clean energy sector a boost.

– March 31, 2005

– www.redherring.com/Article.aspx?a=11650&hed=Oil+Spike's+Tech+Impact&sector=Industries&subsector=Energy

� Our Energy Challenge

– Richard Smalley

– http://smalley.rice.edu/smalley.cfm?doc_id=4862

� The Open Group

– www.opengroup.org



Bibliography- 5

� Oil & gas photo gallery

– www.canadian-wellsite.com/ Gallery/gallery.htm

� The Oil Field of the Future, Now

– Calvin Cobb, Invensys' Hydrocarbons Consulting Group

– http://www.spe.org/spe/jpt/jsp/jptmonthlysection/0,2440,1104_11038_2431164_2450243,00.html

� Paleochannel Mapping for Shallow Gas Exploration

– www.fugroairborne.com.au/CaseStudies/paleoch_mapping.shtml

� Potent Pipe – World’s strongest transmission linepipe

– June 2004, New Technology Magazine, p. 20

� QNEXT – collaboration/communication software

– www.qnext.com

� Scientists Awarded Patent For Coal-Purifying Bacteria

– www.upwardquest.com/02-helpful-bacteria/07-purifying.html

� Smart Dust

– Mighty motes for medicine, manufacturing, the military and more.

– MARCH 24, 2003 COMPUTERWORLD

– www.computerworld.com/mobiletopics/mobile/story/0,10801,79572,00.html



Bibliography- 6

� The Top 10 Emerging Technologies

– Dr. Terry J. van der Werff, CMC

– www.globalfuture.com/gwu-top10-00.htm

� Trends Driving Advancements In High-Performance Computing, Visualization

– www.sgi.com/pdfs/3303.pdf

� Tutorial on the Phase Behavior of Asphaltenes and Heavy Oils

– www.solublesolutions.com/petmacTutorial.html

� University of North Dakota Energy & Environmental Research Center

– www.undeerc.org/default.asp

� Visualizing the Future: The Upstream Industry Unleashed by Technology

– Tony Wood, IBM

– September 2004, CSEG Recorder, File: chemical_visualizing.pdf

� What Is A Fuel Cell?

– www.fuelcellstore.com/information/what_is_fuel_cell.html



The Ten Most Important Emerging Technologies for Humanity

� #1 The Global Electronic Library Coupled With Information Search and Retrieval

– www.newstarget.com/001331.html

� #2 Hydrogen Economy Enablers


� #3 Augmented Reality


� #4 Practical Robots


� #5 High-Density Portable Power


� #6 Fuel Cell Vehicles


� #7 Genetic Engineering of Humans


� #8 Computer / Human Interface Systems


� #9 Vibrational Medicine


� #10 Superlearning Systems


� Where is Nanotechnology?




Top 10 Emerging Technologies Dr. Terry J. van der Werff

� Portable information devices: the post-PC world

– wireless portable information devices will combine the computing power of the personal computer, the networking of the Internet, the vivid images of television, and the convenience of the telephone

� Fuel-cell powered automobiles

– Fuel cells can replace the internal combustion engine to power our cars

� Precision farming

– Farmers will routinely use satellite imaging and a tractor's computer to deliver "varying amounts of of



£100M BOOST FOR GREAT BRITISH IDEASTuesday, March 15, 2005

www.scandoil.com/moxie/news/world_news/100m-boost-for-great-brit.shtml

� Advanced Materials

– high performance materials in extreme and hostile environments. Materials that are reliable and effective under severe operational conditions, such as aggressive or safety critical environments

� Biopharmaceutical bioprocessing

– a wide range of techniques in the development and manufacturing of bioscience-based medicines

� Advanced Manufacturing

– Direct writing - a technology used to produce or deposit materials on complex two or three-dimensional structures

– Next generation lasers aimed at the manufacturing, healthcare and security industries

� Emerging Energy Technologies

– technologies that can help the sustainable development of new and renewable energy sources;

� Zero Emission Enterprise

– developing new technologies to reduce or eliminate creation of wastes, find new ways to re-use and recover waste products, treatment of hazardous wastes, and finding new alternatives to landfill;

� Validation of Complex Systems

– aims to maximize the exploitation of complex assembly systems, especially useful in sectors such as automotive, aerospace and energy; and

� Micro & Nanotechnology: Nano-structured materials technology

– nanostructured materials that address security and crime prevention



Current Research Areasof ExxonMobil

� Proprietary technologies that have the potential to deliver breakthrough capabilities in direct hydrocarbon detection

– technology could significantly improve the chance of success in finding new resources prior to drilling

� Liquefied natural gas (LNG) and other gas-commercialization technology to improve the efficiency of liquefaction, transportation and regasification

– to help satisfy the world’s increasing gas needs at affordable economic levels

� Research on hydrogen production

– for use in fuel cells with strategic partners for potential new power systems in automobiles

� More-efficient, cleaner-burning internal combustion engines and engine systems

– Lower exhaust pollution quantities

� Advanced lubricant formulations to meet stringent emission standards

– Lower exhaust pollution quantities

� $100 million in groundbreaking research at Stanford University's Global Climate and Energy Project (GCEP)

– address future energy needs with approaches that lead to lower greenhouse gas emissions



Standards

� Oil & gas

– API, POSC, PPDM Association

� W3C

– HMTL, XML, XSLT

� IETF

– RFC

� Information Technology

– SOAP, .NET, Java

– Ethernet, GSM, CDMA

– Graphics, video

� UDDI

� Cross-industry

– IEEE

– ISO

– ANSI

– ASTM

– CSA

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