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Integrated Operations Best Practices Needed by Indian Upstream Energy Companies

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Integrated Operations Best Practices Needed by Indian Upstream Energy Companies International Journal of Management (IJM) Volume 11, Issue 9, September 2020, pp. 1223-1232, Article ID: IJM_11_09_118 Available online at http://iaeme.com/Home/issue/IJM?Volume=11&Issue=9 ISSN Print: 0976-6502 and ISSN Online: 0976-6510 DOI: 10.34218/IJM.11.9.2020.118 © IAEME Publication Scopus Indexed INTEGRATED OPERATIONS BEST PRACTICES NEEDED BY INDIAN UPSTREAM ENERGY COMPANIES Rajeev Goyal University of Petroleum and Energy Studies, Dehradun, Uttarakhand, India Dr. S.K. Pokhriyal University of Petroleum and Energy Studies, Dehradun, Uttarakhand, India Dr. Sylesh Nechully Haris Al Afaq LLC, Abudhabi, United Arab Emirates Dr. Sumeet Gupta University of Petroleum and Energy Studies, Dehradun, Uttarakhand, India ABSTRACT The Upstream Energy business, in one sense, is a simple business with every operating company dealing with large amounts of information data confined to various boundaries and thus generating complexity for smarter decision making. Globally for almost a decade, Integrated Operation (IO) has been a known solution to develop an analytics based intelligent online (or near real time) system connecting decision makers to the work processes, existing software applications and the historians. Many global companies have focused very well on IO Enterprise Solution and proved its benefits to the rest of the world. But Indian upstream companies are still not able to reap the real benefits in spite of their plans to adopt IO. In this paper, author is analyzing top India upstream companies at conceptual level for various barriers in such adoption of IO Enterprise Solution as compared to some International Oil Companies (IOC’s). All leading upstream companies in India, which already have a level of instrumentation as compared to other industries without any data sharing across the organization, are highly dependent on human interpretation, making it difficult to optimize various resources in an integrated and timely manner. This paper analyses the specific business areas for data integration and analytics in order to build a smarter organization with focus on multi-billion dollar payoffs over the next decade of operations (Munier et al, 2008). IO Enterprise Solution involves monitoring Energy facilities by having an instrumented, interconnected and intelligent framework across the value chain. By combining workflow information and decision support tools with active near real time dashboards, both planned and unplanned http://iaeme.com/Home/journal/IJM 1223 [email protected] Integrated Operations Best Practices Needed by Indian Upstream Energy Companies shutdowns can be reduced while maximizing money, time and manpower available at hand. The degree to which it can happen will depend on the vision of the Operating Company’s leaders. Enterprise Collaboration is the key for the companies where IT vendors, strategic business partners and academicians shall be able to provide that support to drive more “smartness” into the organization. And this paper shall share that model blueprint. Key words: Integrated Operations, IO Enterprise Solution, Upstream Energy Business, Enterprise Collaboration, Data Integration, Data Analytics. Cite this Article: Rajeev Goyal, S.K. Pokhriyal, Sylesh Nechully and Sumeet Gupta, Integrated Operations Best Practices Needed by Indian Upstream Energy Companies, International Journal of Management, 11(9), 2020, pp. 1223-1232. http://iaeme.com/Home/issue/IJM?Volume=11&Issue=9 1. INTRODUCTION In the digital oilfield era, an end-to-end Integrated Operation (IO) system in which real-time data capture helps to optimize everything from production and drilling to completions and safety, is the ultimate expression of technological advancement. IO Enterprise Solution concept is about employing real time integrated data and new technology to remove barriers between disciplines, expert groups, location and companies with the objective of expediting the time dimension of decision making. But IO term is still used by different companies in different connotations with focus on just one portion of IO Enterprise Solution in reality, e.g. ERP implementation is just one small component of the IO system. The synonym term “Digital Oilfield of the Future (DOFF)” for the end-to-end Integrated Operation (IO) system was coined by Cambridge Energy Research (CERA, now IHS CERA) in 2002. The vision for IO (Crompton et al, 2010) or DOFF emphasizes new ways of working where operators, partners, and service companies could take advantage of improved data and knowledge management, enhanced analytical tools, real-time systems, and more efficient business processes. Figure 1. Integrated Operations layers as per OLF http://iaeme.com/Home/journal/IJM 1224 [email protected] Rajeev Goyal, S.K. Pokhriyal, Sylesh Nechully and Sumeet Gupta 2. LITERATURE REVIEW OF IO BEST PRACTICES The first attempt of designing any IO Enterprise Solution system was performed by Superior Oil for Real Time Drilling Operations Centre (RTOC) (Hobert et al, 20023). But the upstream leader in this space was Statoil with the first implementation of Operations Service Centre (OSC) in 2000 to support five offshore rigs. Conoco Phillips had also established an onshore drilling centre (Booth et al 1989) in 1999 though at a smaller scale. All the major global players had since been taking some IO initiative. BP, Shell, Petrobras, Chevron, ENI, BG Group, Saudi Aramco, and ConocoPhillips, IBM is members of the Smart field Consortium at Stanford University and many other standards groups and industry forums. The aim of the Smartfields (Best et al, 2011) Consortium is to develop efficient software tools for the optimization of oil field development and operations (Kjell et al, 2010), including data assimilation, fast simulation, model updating, and optimal control. However, efforts on complete IO solution implementation started in reality from 2006 by major IOC’s in developed countries. Some of the global IO success examples are highlighted below. Chevron’s IO program called “i-field” (Hauser, 2010) running since 2002 boasts of a suite of 20 advanced “tools” for Chevron operating companies worldwide. Chevron is on track to save up to a billion dollars a year when the i-field and a broader operational overhaul are fully implemented in 2016. The Norwegian Oil Industry and North Sea operators pioneered the development (Ringstad et al, 2007) of IO Enterprise Solution with a high degree of collaboration between Government, Industry, and Academia. Statoil, along with the Norwegian Government, the Norwegian Oil Industry Association (OLF), The Norwegian University of Science & Technology (NTNU), and a consortium of 20 other suppliers and institutions established IO in the High North (IOHN) in 2009, to drive further progress in IO. In early 2010, Statoil began an enterprise program to deploy their IO solution across their North Sea and international assets. As per OLF, the value of IO for Statoil represented a potential of USD 50 Billion (NVP) over an eight years period for the estimates at 7% discount rate at 2007 crude oil prices. Shell has the most successful IO program in part implementation of various IO Enterprise Solution components, with successful Smart Field implementations in the US, Canada, Europe, the Middle East and Africa. Shell has developed a holistic and comprehensive approach with sustained investment in programs such as Smart Wells, New Fields “born Smart”, Advanced Collaborative Environments (Hobert et al, 2003), and Enhanced Oil Recovery through Integrated Reservoir Management. Shell estimates that the Smart Fields program has created over $5 Billion for Shell and its partners until 2009. BP’s Field of the Future (FoF) program (Dickens et al, 2010) is one of the largest IO programs in the industry. BP has implemented its FoF technology on 80% of their Top 100 wells worldwide, they have established 35 so-called Advanced Collaboration Centers around the world, and they credit FoF with contributing over 50 mboed (million barrels of oil equivalent) gross production per year with hard dollar benefits. http://iaeme.com/Home/journal/IJM 1225 [email protected] Integrated Operations Best Practices Needed by Indian Upstream Energy Companies Figure 2 BP Field of the Future Overview Except Cairn India, no other Indian upstream company (Modi, 2012) has published papers on the implementation of IO. Cairn India also started presenting Digital Oil Field (Venkat et al, 2006)in some forums in the last two years but it reflects only about implementation of the selective components of IO. Figure 3. IO infrastructure of 2nd largest Indian upstream company BG is taking some initiative globally but India assets are still limited to Maximo, ERP and niche software solutions. ONGC has spent heavily on SCADA and other instrumentation in field apart from ERP and point software solutions. http://iaeme.com/Home/journal/IJM 1226 [email protected] Rajeev Goyal, S.K. Pokhriyal, Sylesh Nechully and Sumeet Gupta Figure 4. IO infrastructure of 3rd largest Indian upstream company From a general observation of Indian upstream industry, it can be concluded that IO in India is still limited to few niche solution components like ERP, Real time well flow information, reservoir simulators (Cambridge Energy Research Associates, 2003), G&G softwares, RTOC, Asset Management system, DCS and other point solutions covering Finance and Logistics. There is a lack of understanding of a meaningful IO solution. Figure 5. IO infrastructure of 4th largest Indian upstream company Just a few experts tried to present
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