Volume: 4 | Issue: 4

Automated Technology Needed in Wake of Oil Price Downturn

With the drop in oil prices, the industry is looking for ways to stay profitable while still producing at a high level. Some companies have leaned on automated technological systems to help cut costs, but many more are sticking with previously reliable manual methods to run their operations despite an increasingly difficult economic landscape, an expert said.

In a webinar, “Increase Efficiency and Reliability in Oil and Gas,” held by the SPE Gulf Coast Section’s Projects, Facilities, and Construction study group, Jeff Jensen discussed the challenges the industry faces in adapting automated systems and the steps that operators should take to tackle the challenges. He is an oil and gas application engineer at Siemens.

Jensen identified two obstacles: the development of greater operational efficiency and operational visibility. He said that low oil prices have changed the financial break-even point for projects, and operators must become more efficient in order to maintain profitability.

Jensen said process and technology are at the heart of this push toward more efficient systems.

“There is a lot of science behind being operationally efficient, and a lot of that is driven back to, at the core, what you are doing with controlled technology and what you are doing in terms of matching how much a machine is doing a process versus a human being,” he said.

Operational visibility refers to compliance with both government regulations and operational density, which is the amount of resources being used on a given project. Jensen said the goal of operational visibility has become more difficult for operators to achieve as new regulations and the technological processes typically used on site increase in complexity.

“As you make the process more complex, you have people telling you that you have to play within certain (regulatory) boundaries while you’re doing this complex process,” he said.

Operational reliability is another challenge seen with projects. Jensen said that the demanding environments of most onshore and offshore drilling operations cause a high failure rate for the equipment being used at the site, which negatively affects the total cost of ownership.

Jensen presented a four-step plan to help customers learn how to make a system or a process more efficient for industry operations:

  • Eliminate unnecessary steps in technological processes.
  • Simplify context by combining steps.
  • Standardize processes with uniform interfaces.
  • Virtualize hardware functionality by using software.

An effective software lifetime mapping is the key to eliminating unnecessary steps in a process. Jensen said one of the first things that he looks at when working with a customer is the number of software programs being used to accomplish a single task on-site. Fewer programs mean that an operator can spend less time and money on personnel training, which helps streamline the efficiency of a project.

Jensen also said that the emergence of Ethernet protocol implementation on offshore rigs over serial protocol will help simplify data exchange, wiring, and the demand for technology. Serial communication involves the sequential transfer of individual bytes of data over a communication channel, whereas an Ethernet network involves the transfer of data in frames with approximately six times the storage space.

The shift to Ethernet protocol was attributed to an increase in the use of consumer electronics, such as tablets and smartphones. Jensen said the Ethernet is better suited for connecting these devices to other elements of the rig.

“People are now wanting to bring [consumer electronics] on the rigs,” he said. “People want to use an iPad to get drilling data and bring this [data] back to the cloud. People want the ability to take off-the-shelf networking components and hook up the rig. If you’re the one responsible for bringing all these pieces of the rig together, you need to know ahead of time how all of these [pieces] are going to communicate.”

Standardizing processes through uniform interfaces may be a financial issue for operators, as it may require a significant overhaul of the equipment. However, Jensen said operators can standardize in other ways such as by the hiring of people employed in engineering facilities or the purchase of equipment software that can be used on multiple hardware platforms. 

Jensen said virtualization is the most difficult step to achieve primarily because of an old industry mind-set that virtual operating systems, also known as “soft architectures,” cannot be trusted to run a safe process. While he acknowledged the slow adoption of virtual systems, he said the technology has come a long way in the past decade, and it provides enough of an advantage for operators willing to use it.

“What is our fear in moving to a soft architecture? My response is that soft architectures really are our hard architectures now. They are being employed, they are being used, and they have a lot of benefits,” Jensen said.

Ensuring greater performance reliability in an automated system requires components designed to withstand the harsh elements often found in oil and gas operations, he said.

Uptime must be maximized through pre-deployment acceptance testing and post-deployment self-diagnostics, as well as proactive preventive and predictive maintenance. Installing components with plug-and-play modularity and self-configuring replacement parts will help minimize the need for technical troubleshooting.

The webinar is available at



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