Setting up a Drilling Management Center produces a nearly immediate effect for companies engaging in large-scale drilling operations
Gazpromneft's multi-disciplinary Drilling Management Center (DMC) became operational at a new site in late 2015. The DMC was established by Gazprom Neft in 2012 to improve and boost the performance of drilling operations, including on high-tech and high-cost wells, before it was revamped. Gazprom Neft contracted Jet Infosystems as a supplier outsourcing some project work to it. DMC Manager Vitaly Koryabkin shares with us a story of how the GeoNavigator Drilling Management Center, once put in place, has impacted the performance of drilling projects.
— Where did the idea of forming the Drilling Management Center come from? What goals and objectives were laid out by the management? Were they brought to completion?
— In 2011, company revised the approach to rating oil reserves available at its fields. The company undertook a dedicated study identifying a group classified as hard-to-recover oil. The study also showed that its development would not be commercially viable unless the company chose to move on to drilling complex-design and high-tech wells on a full-scale basis thus calling for the need to gain in-house competencies to drill such wells in an efficient manner. The Drilling Management Center (DMC) is one of the field development control elements. We also have other tools, such as integrated design, improved organizational performance projects, a knowledge transfer system, etc.
The Drilling Management Center has been tasked to address the following needs: reducing downtime while running drilling projects, as this directly affects the cost of wells; boosting the performance of drilling wells to achieve required functionality. To break it down in a layman's terms, our core mission is to achieve the productivity/injection capacity target for each supported well on time and on budget: if, say, it is planned to drill a well producing 10 tons/day/atm within 30 days and RUB 100 M, it means that upon completion of such well, we must meet all these requirements.
— To put it differently, had it not been for the Drilling Management Center, you would not have reached the production performance the company held you to?
— It is not quite so… The DMC is only one of available options to resolve this issue. Drilling is a complex process involving a wide range of professionals, both employed by Gazprom Neft and service companies. There are two approaches to setting up this type of operations: either working jointly with a prime contractor or opting for the so-called day rate service. Working under a prime contract, you can reach production targets which the company sets for itself, but it is extremely difficult to directly and promptly impact drilling efficiency. The cost of well is fixed for the customer and is not related to the drill rate. If we operate on a day rate service basis, then any operational improvement made by us directly and immediately affects the cost of well for the customer. But here we face another risk – any wrong move while the well is in development and every minute of downtime means higher costs for the customer. If the company is not willing or is not prepared for some reason to take on these risks, it gives preference to prime contracts. Gazprom Neft works with service companies on a day rate service basis and this is why we decided to establish our own competence center to manage high-tech drilling thus saving us money rather than contracting out the drilling of complex wells, especially at such scale.
— You mentioned hard-to-recover oil… What measures the quality of such reserves?
— First, it is technically speaking the reservoir thickness: the thicker a reservoir, the more oil it contains. Second, it is the reservoir permeability, i.e. the measurement of its capability to produce a flow of oil at a pressure drop. To get the point, you might try to pass water through a sponge and a brick, but a brick is unlikely to allow some medium to flow through it under normal conditions, because its permeability is less than that of a sponge. And oil reservoirs below the surface are roughly similar to a brick except that their pores contain oil in a compressed state creating high internal pressure. Therefore, as downhole pressure goes down, oil will flow even out of that brick. What with attractive spots being the first targets to be drilled at oilfields, the thick and permeable reservoirs are getting fewer and fewer in number, which is the case everywhere around the world.
— When the Drilling Management Center project was completed, had the goals and objectives set by the management been fully met?
— Those KPI targets we set when we were assessing the project's cost effectiveness had been reached. The Drilling Management Center project has been completed, and at present we are required to keep up with the times, as tools are constantly evolving. To become more efficient, we are collaborating with companies dealing with cognitive systems and artificial intelligence.
— When you were making plans for the center, did you look at the international experience? Perhaps, some project could be taken as an example?
— Naturally, we studied the international and domestic experience. We visited all the DMC centers that were operational at that time in Russia, and also several operations support centers at foreign companies in Norway and Kuwait. We visited production operations of a Russian producer where a foreign company was responsible for providing a real-time drilling support service.
Initially, in order to make sure that our visions are on the same page with the best world practices, we work jointly with a company being one of the world's top 4 oilfield service providers. At a later stage, we were moving on with this project without the help of external consultants.
Those KPI targets we set when we were assessing the project's cost effectiveness had been reached. The Drilling Management Center project has been completed, and at present we are required to keep up with the times, as tools are constantly evolving.— Such a high-profile project requires significant financial and resource investment. What called for it?
— Obviously, the project was going through the feasibility study stage. It yields a return with drilling costing less to the company with our support. Gazprom Neft annually drills more than 1,000 wells and the drilling of each well costs a minimum of USD 1 M at the most conservative estimates. Such operations require a sizable budget, therefore even an increase in well performance by the slightest of margins pays off costs due to economies of scale. The creation of the DMC has delivered substantial results in less than a year.
— Could you tell me, please, how much was your IT team involved in the DMC project? What professionals other than drillers and explorers were required for and involved in the project?
— It stands to reason that the project involved IT team members, information security and other business units.
While working on the DMC project, we focused on the operating environment for personnel employees and ergonomics. Even the tables in our office have one of its kind design, there are no such tables anywhere else in Russia. They can be customized to every individual, which is essential for shift work involving different employees sharing one workplace. It is possible to work in the upright position and manage data output not only one's own display, but also on general use ones. Since our employees work at nighttime, we have provided a recreation room for them – a dedicated area where they can get some rest in relaxed settings during their work breaks.
— What is the DMC currently like? What needs does it help to address?
— The DMC is set to support the drilling of 750 wells in 2017.
The DMC currently employs a team of more than 30, some of them working regular work hours, while 18 employees working in shifts. At present we have four round-the-clock shifts with two shifts providing drilling support on the geological side, i.e. constantly updating geological models and giving guidance as to 'where to drill' and two more shifts are busy updating engineering calculations showing whether a well can be drilled and giving guidance as to 'how to drill'. In the process of drilling, we are constantly getting updates on the rock characteristics from sensors located next to a rock-cutting tool. All data obtained is factored in as the geological model is updated, which enables us to develop operational corrective measures thus minimizing downtime and allowing us to drill a well down to a target oil reservoir.
Other DMC team members are assigned to various areas: there are employees supervising our subsidiaries, coordinating operational shifts; employees providing discipline-specific support, for example, geophysics; directional drilling experts, geologists, and a drilling mud engineer.
— Then, let's talk about personnel training. How do you go about the process of providing your Center with qualified staff: do you develop talents within the company or scour the market?
— In general, the company is trying to develop in-house skills. If we require personnel, we invite people from Gazprom Neft Group and train them on our specific needs. About 80% of job positions are filled more or less in this manner. However, 20% of the staff are procured from the market, using this opportunity to share experience and obtain new knowledge. For example, we hire drillers from outside. It takes field experienced people to efficiently run the drilling process and to handle drilling engineering jobs. Since Gazprom Neft is a producing rather than drilling company, we have no in-house drilling crews.
— Perhaps you are already thinking of signing up a set of Data Scientist professionals to help you introduce advanced automated data analysis methods for green-field/brown-field exploration and development?
— The application of artificial intelligence and machine learning has an enormous potential in our industry – once drilling gets underway, we receive a massive chunk of data, which is Big Data in its pure form. In addition, there are great uncertainties in the drilling process; the number of unknown values always exceeds that of equations linking them, so physics & math models often fail to assure a satisfactory level of accuracy thus requiring another data analysis method.
I think that: it is universities rather than petroleum companies that should work on the problem of training personnel for Data Science centers. As it is a challenge to work and study such profound things in parallel. But for the time being, those units do not form a compulsory element of training for drilling professionals. I believe that in the 21st century Data Science courses should become a fixture in the drilling, geology and field development syllabus. I am following developments on this front: reading publications related to the application of Data Science tools in the industry. The potential of new technologies, including Data Science is immense, both in the drilling segment in particular and in the oil industry in general.
— Let's get back to the DMC… What did its operation start influence in the first place? Did it allow the running of projects that could not be implemented before it was put into operation? And perhaps, implementation has moved on to the next level?
— I have already mentioned one parameter, i.e. uptime. Another one is the effective length of the horizontal well section. When drilling a horizontal well, this parameter points to what extent horizontal well section runs into a thin oil reservoir (with reservoir thickness averaging out at about 3-4 m for most of our fields). Once the DMC was put into operation, the effective length of the horizontal well section has grown from 65% to 92%, i.e. out of 100 drilled meters, 92 m will be drilled through an oil reservoir, as opposed to as little as 65 m. This is achievable by constant analyzing data that is collected while drilling, by predicting and simulating what will happen in the process of drilling the next 100 m. It makes it possible to move away from the reactive effect to the proactive effect.
Many companies still operate without a proactive approach, therefore, if an incident occurs at a well site, a commission is assembled to analyze what has happened and make a plan as to how to eliminate the current situation. We make predictions not only when we see some kind of complication, we are constantly updating models monitoring how steady this or that well is behaving in the process of drilling. If we see that the process is not going as planned, we take preventive measures so that no need to re-drill the well would arise.
From an engineering perspective, our core mission is to ensure timely updated and highly accurate predictions while drilling. This is critical as nothing can directly be seen below the surface.
Once the DMC was put into operation, the effective length of the horizontal well section has grown from 65% to 92%, i.e. out of 100 drilled meters, 92 m will be drilled through an oil reservoir, as opposed to as little as 65 m.Those methods, primarily seismic ones that are used to predict the subsurface geological structure allow planning with a very wide error margin. For example, those methods enable us to determine that an oil reservoir lies at a depth of 5,000 m ± 10 m, and such accuracy for a 3-4 m thick reservoir does give us a picture of structural changes in the formation at the planning stage prior to drilling, thus calling for the need of constantly updating our predictions while drilling. The DMC relies on software to create and update geological 3D models, and to run engineering calculations of well drillability. To see whether a well can be drilled, requisite calculations are run through software, specifically, calculations of loads developing in the drilling process. A vertical well is drilled, it is a textbook case with the gravity force just pulling downward, but when it comes to horizontal drilling, it is necessary to weigh up which method of operation will ensure the way forward allowing for gravity and friction. Hydraulic calculations show how efficiently cuttings are removed from a well and also assess the likelihood of wellbore collapse or rupture while drilling. Also, calculations are run to measure the risk of the well trajectory intersecting with those of other wells existing in this field. The accuracy of engineering calculations directly affects downtime, as well as occupational safety performance. So, for DMC supported wells the accident rate is equal to zero.
— Where does the data you acquire come from and what equipment collects it?
— There are two sources from where we can obtain data. First, from the wellhead at the surface – there are scale sensors, and cuttings analyzers; measurements of drilling fluid properties, etc. are made. The second source of data is located next to the drill bit – there are sensors that show what type of rock currently surrounds the bit. This information comes through the hydraulic channel in nearly real time, to be further collected at the wellhead and sent via satellite communication to the central server linked to our offices.
— How many wells are supported by the DMC and what is their geographical distribution?
— For the time being, we are giving support to about 25-30 wells that are in drilling, and overall it involves about 70 drilling crews. Those wells that are not currently getting our attention may in a couple of weeks' time come to a point where we will take them in for support.
Russia features a wide geographic span with our easternmost supported site being located on the Sakhalin shelf and the westernmost one in Russia – in the Orenburg region. We also support wells that are being drilled in Serbia with a subsidiary of Gazprom Neft – NIS (the Petroleum Industry of Serbia) taking charge there.
— How does the system of communications between employees operate? Do you need to have any fast communication links with those rigs and with fields?
— This is no longer a problem in the modern world. Normally conventional means of communication fit the bill. At those locations where there may be difficulties, for example, in the Arctic, mobile communications stations sometimes need to be set up and running. Such projects are coordinated by the IT and communications unit.
From the communication perspective, it is necessary to create systems that would consolidate the entire array of our calculations plus geological models and project them on a single screen in a form that is understandable for both managers and discipline-specific experts. We are working on creating a single interface that would allow users anywhere around the world to see the current situation and to be remotely involved in the process. At the moment, communications are limited to individuals involved in drilling projects – these are the DMC team and employees located on drilling rigs. They can at all times see and share entire information and communicate with one another. Our job is to create an interactive communication platform taking into account our work specifics to the maximum extent possible and enabling this process to be brought to the next level.
— The similarity between the DMC and the Mission Control Center comes into mind. Do you often receive visits from groups and delegations to learn from your experience?
— We deliberately engineered a certain element of space into the conceptual design of our office, so that it would be along similar lines with the Mission Control Center. So, we wanted to accentuate the importance of work done by the Drilling Management Center, not only in terms of commercial value, but also in terms of occupational safety. It is impossible to take in everything at the planning stage, sometimes drilling crews are confronted with unforeseen contingencies. To be in a position to adequately respond to such contingencies, it is necessary to identify root causes giving rise to them and to that end you need analysis on an ongoing basis. Here the DMC makes its essential contribution. I am proud to say that the wells supported by us are free from serious incidents, never mind, accidents.
I would like to add one thing. We deal with uncertainties this is why the DMC was set up at the Gazpromneft Science & Technology Center. What is the difference between the scientific and the non-scientific? When using a scientific approach and techniques to answer one question you always end up with having two new ones. When we make an improvement on something, we immediately see the room for further improvement. We are aware that we should not sit tight – we should always improve our approaches, algorithms, software, etc. And from the science-intensive perspective, we are also akin to the Mission Control Center.