9/30: Arriving early to get a lay of the land catching a glimpse of workers taking a breath before the launch while exploring spaces first-hand without admonition associated with overstepping boundaries during ritualized activity.
Center for Integrated Operation Conference, September 30- October 1
The event begins with a few introductory comments from Arild Nystad, Chair IO Center/NTNU and a short video depicting graphic design innovations in knowledge communication in the oil and gas industry.
Up now is Unni Steinsmo, President of SINTEF, largest research concern in Norway, talking about technology, generic developments that have daily impacts on oil/gas development and society more generally. Unni points out the diversity of the IO Center as measured by the various academic and industry partners involved, including the number of partners, publications, MA and PhD degrees. Sustainability framed in terms of carbon capture and sequestration but also in terms of IO capacity for introduction organizational and technical innovations.
Plenary I: Intelligent Petroleum Fields and future technology challenges in Oil and Gas
Session chairs: Frans van den Berg, Shell and Arild Nystad, IO Center
Tord Lien, Norwegian Minister of Petroleum and Energy. Introduced as having taken an MA degree in history at NTNU, 2003.
He begins, “I’m happy that you mentioned my MA degree at NTNU even though it isn’t in energy [audience chuckles]”. The future of the Norwegian continental shelf.
Opening of Ekofisk [petroleum well] in 1969, a dramatic event. Today, nevertheless, projects today on hold, rising development costs and declines in production taking place raise concern.
General tendency is that Barents sea will be developed. Goliath [production] opening up next year, licensing rounds increasing, maturity in Nowegian continental shelf being revisited through enhanced production and new licensing.
The Subsea Factory: Solving complex technical challenges. Industry must be initiator of handling developments in industrial sector and government needs to take a back seat or provide funding. Government’s role is to create frameworks of innovation through public funding support, as an example, RCN’s Petromaks and Petrosams research and development.
Helge Lund, CEO, Statoil, speaking now on technology enablers for increased efficiency. “Thank you for the opportunity to address this expert audience [Last week in Trondheim addressing 500 students on how to address challenges of development] – contributing with some reflections on oil and gas environment. Last few months have illustrated how volatile the world is these days, instability in Middle East (Iraq, Syria), Russia and Ukraine, Africa (Nigeria), almost got a new country in Europe (Scotland) which would impact oil and gas companies.”
Three issues that industry needs to deal with communities, climate and competitiveness. Community: Industry needs access to reservoirs, but also dealing with new areas closer to communities, and there are higher expectations than not creating harm, but also to share the benefits of development which is much more than royalty and tax share. Tanzania, last month during a gas discovery, you could grasp the sense of expectation.
Climate: Last week at the UN attending climate meeting, an urgent fight, and could feel the personal pressure to be a part of the solution as a representative of the industry. We need to provide these resources with less CO2 emissions, requiring new policies to stimulate innovation and new innovation, and society should put forth a sufficiently high price on CO2 in order to address the issue. Carbon intensity is an integrated part of how Statoil addresses moving forward, integrating what those figures might be in decision making. [US Dakotas] Bakken off-gassing, has been converted to CNG dramatically reducing flaring and halted field composition on gas; Peregrino, looking for transport solutions and reducing energy consumption.
Competition: build in more production, reduce complexity through innovation (industrial standardization across operators and suppliers, fast-track projects, lower costs) – providing huge potentials through simplifications — achieving plug-in play rationality. Integrated operation “as I see it” is an enabler. A broad set of centralized centers, saving cost and improving possibility of efficient operations and decision making. Technology can make companies, make industries and transform societies. No doubt, technologies will continue to change oil/gas development in the same way geopolitical conditions influence the context.
[Questions by participants] Expectations of a CO2 price of $50-$75 per ton. By 2020, reconfiguring $50 per ton (which is low), in order to keep licenses to operate and continue to move gas to replace coal.
Cristina Pinho, E&P Executive manager, Petrobras commenting on upstream services and its enormous scale. The most challenging aspects of development is the human capital issues, but the most rewarding also is the team implementation.
Chon Fui Chai, General Manger Smart Fields, Shell, sharing a journey to smart fields, stressing Organizational capability through structure, behavior, sustainability; Dealing with big data, collecting and using the right data, algorithms that convert sensing to sense making utilizing industry standards and predictive analytics; Consistent screening and technology deployment in projects through project screening and follow up…
General discussion with the speakers at the panel stage: investment costs up by 75-80 percent, with development profits up only by 4-5 percent. What is going on with this, asks Arild Nystad. Responses: Differentiating where we need standardization and industrialization versus innovation and creativity.
Lunch
Plenary II: Proactive Operations
Session chairs: Jon Staekebye, Kongsberg OGT and Prof. Bjarne Foss, IO Center/NTNU
Up now is TNO’s Ruud van der Linden, talking about mature fields. TNO runs contract applications somewhere between industry and academia, founded by government with industry application, “similar to Norway’s Sintef”. Modeling of flow phenomena which they use for optimization of well extraction.
[Note to self – with Vidar Hepsø, STS scholar and petroleum anthropologist, sitting as my neighbor at the table, I am reminded of one of his articles where he points out how geological mapping of reservoir knowledge does not rely on photography (realism) as a form of truthful knowledge.
Instead, for example, the body of a geologist to determine scale.
I noticed Ruud van der Linden use photographic image of a well-bore to depict reality, versus a previous image on gas extraction represented in the form of a graph which I communicated to Vidar as a data point.]
Prof. Bjarne Foss, Dept. of Engineering Cybernetics, IO Center/NTNU: Transforming mechanical artifacts into intelligence. Downstream increasingly automating complex operational decisions by merging: real-time process data, with mathematical models and mathematical optimization.
Moving this process upstream — capitalizing on shrinking margins (downstream has always attempted to get by on capitalizing on small margins, and market affect that is now moving to the upstream). Looking for a system over time that can assure highly continued optimization.
“party”
“no-party”
Plenary III: R&D and Innovation
Paulo Viana, IO Coordinator, PETROBRAS — A project has to end, because it is a project, but the structure has to provide model for facing the future in an effective way, a transformative layer, so that each function sees the other function and collaborates and integrates.
Up now is Jon Kvalem, Director, IO Center/Institute for Energy Technology, talking about collaborative environments in the oil and gas industry. Thinking about what IO Center has achieved in collaboration and Innovation – utilizing new IO technologies, SOFIO. Structured Observations with Feedback of IO Interaction (SOFIO). There is the IO Map (Risk visualization prototype) and the scenario visualizer. Referring now to Statoil’s Logistics and Emergence of Response Center and ENI capability development and organization development — challenges in the Barents Sea.
“impression management – recognizable logo seen at a distance“
Senior Vice President, Statoil, Lars Høier, speaking on standardization is the new innovation. Moving into an area of cost cutting – we just have to think differently and define the next generation standards. A lot of opportunities if you attack it in the way of standardizing the industry context. The relationship between research and industry in standardization: More complex projects; capital costs increased; high oil price but lower margins (is seen consistently); Research and technology is part of the solution.
Using examples from Norwegian continental shelf. (1) Fast model update first in use 2010 (Grane Snorre, Sverdrup, Peregrino, 8 other committed); Pin Point first use in 2010 – better well placements for well drilling (Asgard, Njord Hyme, Snorre); AICD Valve and iRips (Barents Sea, 8 wells on Troll = 2400 valves).
Fast track, 40% less time to production; US onshore lowering drilling cost; Cat rigs, higher operational efficiency; Floating storage units; Stadardized equipment and modules; Vertical x-mss trees; Standard production weeks; Subsea on slim legs — A lot of innovation to success [uses the word “attack” repeatedly to talk about lowering costs in the context of standardization].
Technology of deep dive — subsea factory. Subsea Factories – Brown field factories — that we plan to tie in. technology elements as simplification
Second day
Torstein Sanness, Managing Director, Lundin Norway, focused on organic growth strategy and exploration. Replacing reserves. Around since 2004. New Norway – High North, same size as the Norwegian sector on the continental shelf. Keeping the company focused looking at oil liquids with 60 licenses. If you want to be at the edge and try technology before anyone else, and be in a major discovery every third year, you need innovation. Open culture meeting with workers every week demonstrating growth.
Dinner comments Torstein Sanness
Pieter Kapteijn, Director, Fossil Future – Norway’s capability cluster (government, business, academia). Quotes John Lennon, “Life is what happens to you when you’re making other plans”. Sierra Oil and Gas. Presented the idea of “Smartness”. Fascinated by Helge Lund, what do leaders of IOCs worry about, what IO (innovative operation) really is and what it offers, what we have achieved, the role of leadership in IO. The true belief in leadership that technology can make a difference. Worrying about higher costs that eat into the margins. Not confidence that they will find the resource, moving into more difficult areas, the resources discovered are more challenging, expensive EOR, Arctic, there are new competitors.
Disintermediation– Service companies are becoming exploration and production companies; A defining debate for oil industries is climate change – creating pressures.
Becoming an increasingly competitive company, looking at complexity and wanting to find simplicity — when faced with such challenges what do you do? In the past, simple, low risk –defer projects and investments; quick results –laying off staff, tried and tested; chase cost reduction–sell assets; minimum disruption–no changes to business model. But what if these changes are more fundamental? At what point do you make structural changes to business? Invest in new capabilities: Create new partnerships- creating new ecologies to allow business to move faster; rethinking and redesigning business.
At the core: cybernetics. Looking at systems thinking to look at the organization of your business.
Creating an enabling organization. Creating an environment that works. Business value of IO [smart wells] has been proved in the field: and we have only scratched the surface. Creating a better risk profile. How do we make something that is integrated across disciplines and make it work.
Are you trying to control or enable; are you standardized or organic; do you want hierarchical or flat; is it a tight or loose organization; address all these issues. Bent-Ove Jamtli begins with an anecdote of his early experience in the army with Helge Lund, working in a small Saami town in the High Arctic, and talking about search and rescue.
Vegard Evjen Hovstein, CEO of Maritime Robotics AS. [cybernetics in certain ways became the surprise word over the past two days with a few folks paying homage to its meaning in the context of IO, ed.]
Vegard referred to this interesting automatic versus autonomous systems, referring to the Center for autonomous marine operations and systems in the Arctic.
Up now is Eldor, remote operations in the context of IO presented by Ove Heitmann Hansen, Managing Director, Eldor AS. Moving remote operations to even more remote. Why should pilots be sitting at the front of the plane with the best view? Why not move them back with a computer screen, or off the plane altogether. Similarly, using information technology to change work processes to achieve better decisions – technology enables remote control of equipment and processes. Functions and personnel can be moved from offshore to onshore.
Generation 1 case – BP Valhall, offshore and onshore control room with shared control responsibilities. Level 2 Partial Onshore Control – shared control from a remote location – at Valhall this means offshore & onshore control room with shared responsibilities for operations and surveillance between offshore and onshore. 
Generation 2 case – Total’s Martin Linge – One control center with four control suites —
Final panel: Trond Lilleng, Statoil; Tony Edwards, StepChange Global; Kaare Finback, Knogsberg; Pieter Kapteijn, CEO Sierra; Arne Holhjeim, Norwegian Petroleum Directorate.
Lilleng: IO steps, production to projects, moving gradually stepwise expert stepwise establishments.
Edwards: Managing inherent complexity; value chain integration.
Finback:
Kapteijn: Pervasive sensing, unlimited computing power, plug and play modeling, unlimited data capture, unlimited bandwidth, molecular/nano scale engineering
Holhjeim: Norwegian Petroleum Directorate — good management, efficient, as much resource out of the ground as possible, minimize environmental impact.
Paparazzi Ethnography 
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