1. Reduce costs

• By decreasing the amount of miles a pumper drives, because he has visibility into each well and tank battery before he leaves his home or office
• Allowing field personnel to “pump by exception”, and go first to the sites that require their attention and expertise
• By reducing the number of mechanical failures, because preventative data is always being monitored by the Wellkeeper system, and alarms are sent

2. Increase production

• By knowing when wells go down and getting them back online sooner
• Remotely configuring Pump-off Controllers, EFMs, plungerlifts and PLCs
• Having real-time visibility into the behavior of a well
• Providing engineers the data needed to maximize production
• Identifying up & downstream effects on production, and eliminating problems

3. Prevent spills

• Using Wellkeeper’s Alarm Notification System
• Dispatch personnel to the site before the spill occurs, allowing time to take corrective and preventative action
• Turning pumps on or off when an alarm condition is present

4. Generate accurate measurements

• Using the latest technology to provide sophisticated measurement and real-time data gathering
• Knowing what wells are doing minute by minute

Wellkeeper offers a cost-effective way to have access to well data by being able to sign into the website at your convenience, to view both the current and historical well production information. Wellkeeper has recently unveiled some significant improvements in remote monitoring services, such as remote configuration of equipment, real-time data every few minutes and extended coverage of wireless communications, which lowers the monthly telemetry cost dramatically.

Wellkeeper has helped companies lower their cost of operations, increase their production, and reduce environmental costs associated with spills. During these times of uncertain commodity prices, tighter capital, and increased environmental liability, Wellkeeper’s services can generate an immediate ROI.

So what to do with all that data? The opportunity is to:
1. Do optimal scheduling and dispatching of field personnel
2. Do predictive maintenance allowing minimal maintenance expenses with maximum production
3. Plan for and manage required resources to eliminate waste and ensure timely availability of resources
4. Have more granular data for reservoir modeling

The ability to balance the first three above competing objectives stems from the development of three techniques previously available only for the major oil companies for decision support.
The first is PROBABILISTIC SIMULATIONS that periodically process the incoming data from the remote monitoring system to understand the range of potential future outcomes that may occur for that well/field. The second is INTELLIGENT AGENTS that are embedded in the simulations who react to events according to rules used by the operational process. The third is an OPTIMIZATION ENGINE that can “shape”, under uncertainty and risk, the range of outcomes of a plan so that decisions can be made to move toward the desired results, while minimizing effort.

These concepts have been successfully applied to several major oil and gas field operations. To do it successfully requires not only the remote monitoring data but a commitment to an iterative process where the above tools “learn” over time to fit with the actual field being operated. It also requires integration with the cultural and procedural context of the organization (in other words, what the organization believes is the best way to operate). The result of the interaction between the decision support system and the organization is a continuous learning process for the life of the production field.

So to enable the investment in remote monitoring to be fully realized, a producer has the opportunity to acquire additional tools to avoid being buried in data. Using these techniques, instead of drowning in too much data, the operating company will be able to react more quickly to problems and opportunities and plan better for the future. Data is good, once you pass it to new tools that react to events as they occur in the field.

Co-authors:

Dr. Lester K. Sisemore
President and CEO
VGO Oil and Gas

Dr. Sisemore has over thirty years experience in the Exploration and Production sector of the oil and gas industry as a senior technology executive with Chevron, an executive consultant with IBM Global Services, and an independent consultant. Focus areas have included geophysical research, exploration operations, upstream data management, and technology management. Expertise includes strategy and planning, operational modeling, business process management, project valuation, portfolio decision-making, and technology implementation. Dr. Sisemore has specialized in the implementation of Upstream Petroleum Technology – including the strategy, planning, and change management that are a necessary part of this process. Focused on the improvement and sustainability of oil and gas portfolio and asset performance, is able to help clients create competitive advantage by solving important operational problems.
Contact information: les@vgo-oilandgas.com or 281-344-0351

Greg W. Scoggins
Vice President
Wellkeeper, Inc.

Mr. Scoggins has over 20 years experience in the oil and gas technology solutions business. His focus areas have been remote data monitoring solutions, operations and production process efficiency improvement, reserves and economics software systems and integration of engineering software tools using decision tree analysis. Mr. Scoggins came to Wellkeeper from OGRE Systems, where he also served as Vice President. Previously, Mr. Scoggins was a Vice President at Implicit Monitoring Solutions and Landmark Graphics Corporation. Mr. Scoggins has a Bachelor of Science degree in Engineering Management from Dallas Baptist University, and is a 28 year member of the Society of Petroleum Engineers (SPE), as well as IPAA.

Contact information: 888-WELLKEEPER (888-935-5533) or Greg@Wellkeeper.com

If the value point delivered by remote data monitoring outweighs the return on investment timeline set by the corporate and operations staff (typically 12-18 months) and the value point benefit is considered important by that organization, then the investment should be seriously considered.

A rather short-sighted argument is to not invest in remote data monitoring during an economic downturn in the oil and gas industry. An economic downturn is typically associated with the requirement of the prospective buyer to limit future spending, cut current field operating costs, and diversify offerings to mitigate losses.

Although the critical value-points are now typically shifted to cost savings, all of the value-points for remote data monitoring still exist. As such, a company evaluating remote data monitoring to address these value-points should, under the same pretext of return-on-investment and corporate prioritization, invest in the underlying system that best supports their needs.

Suffice to say, some companies looking to address economic downturns with an investment in remote data monitoring have accelerated the ROI cycle times and limited their capital budgets. These same companies have an adoption acceptance curve that has shifted to represent their new needs; however, they still have value points that demand remote data monitoring solutions.

In times of economic crisis, vendors must be conscious of the changing corporate and operational priorities of their clients, while buyers must be conscious of not losing sight of the value that remote data monitoring can bring, regardless of their current economic situation.

If the buyer has any hope the industry will eventually rebound, the best time to implement remote data monitoring is when other projects are postponed and more attention can be focused on cost-saving tools. While the breakeven point of an investment in remote data monitoring is usually months, the largest benefits will be realized when the industry returns to a robust state. By increasing production, remote data monitoring is even more valuable when commodity prices are higher. By reducing operating costs, such as spills, pumper fuel costs, pumper truck maintenance and oilfield equipment maintenance, remote data monitoring delivers an even larger impact on profitability when the costs for these things are higher.

In short, the time to invest in remote data monitoring is now. By utilizing remote data monitoring to streamline and better manage field operations today, oil and gas companies set themselves up to cash in on the benefits for years to come.

Critical Value Points for Remote Data Monitoring

There are several critical value points inherent to oil and gas field operations that are addressable through adoption of remote data monitoring technology.

Greater Quality Control to Reduce Wellsite Spills
Faster Quality Control to Reduce Wellsite Spills
Optimized Production Scheduling
Increased Production Throughput
Increase Production Yields
Reduced Production Overhead
Optimized Information Flow to and from Field Worker
Quicker Response to Field Workers
Reduced Need for Routine Wellsite Inspections
Reduced Human Errors during Daily Production Reporting
Enhanced Corporate Decision Making
Scalability to Expand Operations
Scalability to Reduce Operations
Reduced Overhead for Product Storage
Accelerated Auditing
Minimize Shrinkage
Access Real Time Inventory

A more efficient alternative is to use a public network for all or a portion of the data collection. Digital cellular modems are available from a variety of vendors at a price point half or less the dedicated spread spectrum radios mentioned above. They are designed to communicate on the major cell carriers existing networks set up to carry voice and increasingly, data traffic to the oil fields. This approach uses less expensive devices and removes the need to construct and maintain a dedicated tower, freeing that capital for other uses and allowing the network to be deployed anywhere within range of a cell tower.

When the field to be monitored has a high concentration of wells in a limited geography a hybrid approach is even better than either extreme of all private or all public infrastructures. This approach uses a set of digital cellular modems dispersed through the field collecting data from several nearby locations via low power, inexpensive radios. The monthly costs are thus reduced without requiring the private tower’s costs and exposure to a single point of failure.

In summary,

1. Spread spectrum radio systems require a very large upfront cost
2. Building radio towers in the oilfield increases the risk of failure of the entire system, as there is one single point-of-failure. If high winds damage the tower, or a power outage hits the area, all well sites will be unable to report data to the server
3. Digital cellular network technology is exploding, primarily due to consumer demand. This means the major communications companies are rapidly offering the best, cutting-edge technology to even remote areas of the oilfield, and continued innovation will be funded by consumers. This means reliable, consistent and inexpensive data networks for the oilfield.
4. Using a hybrid approach, companies are using digital cellular and low power, inexpensive radios to provide the real-time data they need to improve their operations and manage their assets effectively.