The digital oil field grows up: beyond the hype, the oil industry is working to make IT serve its needs realistically in the office and in the field. (Growing an E&P Company smartly: information technology).(information technology)

Publication: Oil and Gas Investor

Publication Date: 01-MAR-03

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COPYRIGHT 2003 Access Intelligence, LLC.

At an experimental shallow oil well being drilled in a cornfield in Indiana last year, the private operator, Team Energy, and its service partner, Schlumberger, were trying to prove a new downhole technology application.

Two Schlumberger experts sat on location for nearly a week, waiting for the right combination of events in order to test their product. But as often happens, drilling progress occurred differently than expected. The pair had to leave to honor previously scheduled commitments, one in Moscow and the other in Abingdon, the U.K.

This posed no problem.

On their respective laptops in their hotels thousands of miles from that cornfield, they continued to monitor the test well's progress in real time, and communicate with each other and with people at the well site. It was a success.

"Anything that contributes to efficiency is going to win," says Ian Bryant, a Schlumberger marketing director. "The U.S. is going to need to manage more wells with fewer people. The only answer is to leverage IT to the max."

Some call it the smart field. Others call it the digitial oil field or the e-field. Whatever the term, it means using IT in new ways to save money and optimize staffs, wells and ultimately, the bottom line. Now that the easiest cost-saving methods have been used, and used up, in the last two decades, it's time to move to the next level, the experts say.

"A smart field can recover more oil and gas from the reservoir," sums up Ihab Toma, president of Schlumberger Information Solutions.

"If every day at 7:30 a.m., everybody already knows what everybody knows and where the company stands [by virtue of IT tools that deliver real-time field and accounting data], then what are your people going to do for the next two hours? They don't have to scramble to find information and prepare reports, so they can add real value in other ways," adds colleague Bill Baksi.

Finally, the promise of IT, information technology, has gone beyond the hype of 2000 and the subsequent dot-com bust and wave of IT mergers.

It is becoming a realistic tool for oil and gas companies and one with many applications: back-office accounting and payroll, regulatory reporting, land management, well monitoring and control...

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