In a prolonged period of low oil prices, relatively high-cost oilsands producers are under more pressure than most to bring down costs to remain competitive.
One of the quickest ways available to do that is to digitize the process.
While the promise of the digital oilfield has been around for several years, its implementation has been slow. Technological advances that have brought costs down and simplified the transition, as well as the pressing need to cut costs, are starting to change that.
New digital solutions are emerging from both the major oilfield services and tech giants and organic start-ups leveraging the rapidly evolving Internet of Things (IoT) and associated advances in big data, analytics, cloud computing and ubiquitous connectivity.
The business management and analytics segment in particular, which is seen as a formidable accelerator of products and services in other sectors, offers great potential for the oilsands, according to the Canadian Energy Research Institute.
A recent IHS CERA report found that digitization improves productivity by two to eight per cent, with an operating expense reduction of five to 25 per cent and a capital expenditure reduction from one to 10 per cent depending on site localization.
Here’s a look at six digital technologies that promise to lower costs and improve the efficiency of oilsands operations.
- SAS has developed an asset optimization system for thermal oilsands producers that creates analytical models able to compute optimal steam distribution on a field-wide basis. It is designed to determine, for example, which wells to starve and which wells to feed more steam as availability dictates. Statistical models created by the program—developed from data collected from several SAGD operators—recognize process changes with time for each well pair while analytics evaluate and update models to provide performance predictions. The system is also designed to predict events such as steam breakthrough and process upsets before they occur, thereby minimizing costly unplanned events and maintenance costs.SAS estimates its technology can produce an additional 40 bbls/d per producing well, which on a 100-well-pair facility would translate into a production increase of about 1.4 million barrels annually or $24 million in increased pre-royalty cash flow with oil priced at $46/bbl.
- Calgary-based start-up Veerum is combining several recent advances—from asset tracking to digital twin technology and virtual reality—to enable cheaper, more efficient project delivery.Veerum uses robots and drones, lasers and photogrammetry to capture the layout of a physical site and create a digital twin to within a millimetre’s accuracy, it says. The system allows users to pair the virtual digital twin with the project’s plans in an effort to ensure the design and reality are a perfect match. The company is now adding virtual reality to the mix, allowing users to don headsets and take a virtual stroll through the project’s digital representation.
- GE’s Thermal Production Optimization software uses proprietary machine learning models to create a digital twin of a SAGD project in an effort to optimize operations like steam allocation across the field—which can have a material impact on production and save a company millions of dollars. On a typical SAGD facility, there may be too many dynamic variables at play for any one reservoir engineer or team to solve. Advanced analytic and machine learning, however, can leverage the massive volumes of data the facility produces to provide well models that are used to run what-if scenarios and constraint-based optimizations. That could allow operators to establish ideal operating parameters on individual wells or across an entire field. In one published case study of the Thermal Production Optimization software, GE said it produced a one to 1.5 per cent improvement to steady state operations and a three to five per cent improvement to non-steady state production across a SAGD producing field. Even a one per cent improvement in production can yield millions of dollars in additional revenue annually.
- Calgary-based Stream Systems has also developed a cloud-based software-as-a-service application that allows users to create, customize and test their projects in a virtual environment to extract maximum value from large capital investments. Stream Systems says it can trim the costs of capital projects 20 per cent by using simulations to mimic reality to test innovation in a risk-free, virtual environment.By virtually replicating key elements of a business challenge, Stream Systems says it can run any number of variable inputs and outputs—for example, different economic scenarios, regulatory changes or the effect of equipment breakdowns or different routing options—and allow companies to experiment with design and operational strategies until the best approach to solving a problem is determined.
- While companies in the consumer auto market are racing to perfect driverless vehicle technology, oilsands producers are close to implementing the technology for some of the world’s biggest vehicles—the heavy haulers used in oilsands mining operations.Suncor Energy, which has a fleet of about 100 heavy haulers, is piloting the technology with 400-tonne Komatsu Front Runner autonomous haul trucks as part of a larger shift toward increased automation in mining. The Japanese company producing the Front Runner already uses the technology at large mines in Chile and Australia. Able to be remotely controlled and operated 24/7, GPS-assisted autonomous heavy haulers, which have also been developed by Caterpillar, are expected to cut costs five to 10 per cent.
- Engineering and procurement firm Vista Projects has created an integrated data portal designed to provide an open project database with real-time updating ability that can be shared by all parties participating in a major project. Full digitalization creates a layered and comprehensive online database that can be searched quickly and easily, Vista says. Integrated engineering software is designed so changes made to one part of the design are automatically replicated or flagged in other layers of the database.Vista says it recently completed one of the oilsands industry’s largest and most comprehensive implementations of a digital engineering environment for a new project’s front-end engineering and design (FEED). The technology allowed the operator to reduce costs through process simplification, plot plan compression, fit-for-purpose specifications, increased modularization and optimized execution, Vista says. The result was a collaborative effort with its client that led to FEED coming in 16 per cent under budget.