Mission-critical oilfield data

EFFICIENCY AND ECONOMICS ARE CHANGING THE WAY DATA IS COLLECTED, STORED, AND USED THROUGHOUT THE OIL AND GAS SUPPLY CHAIN

BILL BIEWENGA, QV21 TECHNOLOGIES INC., AUSTIN, TEXAS

A WIDE VARIETY of mission-critical data permeates the upstream portion of the oil and gas industry, and it is becoming larger in scope and volume. The data and its delivery are also becoming increasingly accurate and timely. Simultaneously, the rapid and exponential growth in new wells and production of unconventional crude has significantly changed the dynamics of crude oil acquisition, marketing, and transportation, including crude trucking, transloading, terminal operations, and contract management. These factors radically change the way data is collected, stored, redistributed and used to enhance profitability in a number of ways.

In conventional oil fields, prior to the widespread introduction of unconventional drilling, crude gathering, and marketing was often a predictable business with relatively stable production of a known quality product. However, traditional oil and gas logistics data collection, storage, and redistribution were limiting and needlessly expensive. Efficiency and economics are rapidly altering those processes.

Oil companies and the trucking companies that serve them have been utilizing a paper-based system of data collection using paper run tickets for numerous years. Dispatchers organized their tasks either on paper, whiteboards, or sometimes in simple spreadsheets. Drivers deposited copies of their run tickets in a "pickle jar" at a drop-off point.

The system worked in the sense that the majority of the data were collected, but tasks were often repeated at various stages in the supply chain, and data flow was days or weeks behind real-time. Loads were recorded and measurements taken using manual means. Load volumes were based on universal strap sheets, despite the fact that wellhead tanks varied slightly in size and shape. A 400-barrel crude oil tank might, in fact, contain 403.09 barrels. The standard strap sheet using generic volumes immediately introduced inaccuracies at the initial pickup points. Paper run tickets were stored and copies sent to various stakeholders for further data entry and reconciliation.

With relatively new technologies of crude oil production and with multiple new well completions coming on-line daily, bringing with them variable crude qualities and erratic decline curves, crude gatherers and purchasers require improved technologies to ensure they can balance their operational constraints against their commercial obligations. In this environment, manual recording and reconciliation of load data days or weeks after delivery will potentially result in unmet deal obligations, improperly hedged positions, and significant end-of-the-month P&L swings.

By utilizing the latest truck management technologies and properly integrating the newly available real-time field data with terminal operations and ETRM solutions, crude companies can optimize their physical operations, reducing costs and exposures, and improving profitability. Digitizing the oilfield from the wellhead to midstream is the only solution to take advantage of this new marketplace.

While crude oil production has been undergoing radical changes, numerous technological advances have also been taking place in data storage and smartphone technology, creating far-reaching, cost-effective possibilities for the oil and gas industry. Those possibilities are now a reality.

• Big data is evolving into Intelligence - usable, actionable information.
• Fixed information is becoming mobile and available to more stakeholders and end users.
• Batched data is becoming available in real-time.
• Owned computer storage and assets are becoming available as leased Software as a Service (SaaS).
• Internally-operated computer storage, retrieval and protection are drawing upon managed expertise via The Cloud.
• Expensive dedicated resources are becoming highly affordable to companies of all sizes.
• Complex software is becoming more user friendly.
• Big, costly upgrades are giving way to continuous releases and upgrades.

Qv21 Technologies has partnered with transportation and oil companies in the Bakken and elsewhere to change the model. Qv21's business leaders and developers engaged with some of the largest E&P and crude oil marketing companies and oilfield services trucking companies to explore the possibilities of streamlining the entire system. The goal was to improve efficiency, timeliness, and accuracy of the entire process, not only for the trucking companies, but for the oil companies providing data upstream and receiving data downstream.

Use of automated crude logistics solutions and integration throughout the upstream supply chain provides a number of additional benefits on the transportation side of commodity logistics, including optimized routing, maximized driver efficiency, improved equipment operations (i.e.: reduced fuel costs, increased equipment utilization), and reduced back-office workloads by eliminating manual data entry and automating invoice and pay statement generation.

New capabilities have been developed to address the unique needs of oilfield trucking operations, including unique commodity requirements, multiple load cycles per day and hazardous operations. These oilfield capable solutions not only provide the truck tracking and inventory management capabilities necessary to optimize routing, they also provide load management solutions that can automate run ticket generation - reducing data entry errors and automating the communication of load characteristics such as gravity and BS&W (and therefore load value) to the trucking company and potentially to the well operator, transloader, and first purchaser.

Utilization of The Cloud for data storage enables seamless collection, storage, and redistribution of mission critical data that has an impact throughout the oil and gas supply chain. From upstream to midstream and beyond, data flow is accelerated while discrepancies are minimized, providing a more efficient movement of actionable information.

When the logistics solution is provided as Software as a Service (SaaS), the rapidly improving data flow is no longer restricted by costly and time-delayed periodic updates on proprietary hardware. Smartphones, acting as small, powerful computers with the ability to communicate vast amounts and types of information, provide a ubiquitous, low-cost in-cab solution for truckers running to and from the wellhead. Data is collected and sent wirelessly via Bluetooth or WiFi as well as via cellular networks, enabling automatic collection of vehicle-specific data from the vehicle's J-Bus, onsite printing via small thermal printers and redistribution of load data in real time.

Actual solutions put in place depend on the needs of the stakeholder whether they represent the transportation provider or the E&P company, first purchaser, or terminal operator. Each requires a particular subset of the overall logistics data for their own particular requirements.

As an example, Qv21 utilizes a technology that enables E&P companies or trading companies to place orders to OFS transportation companies electronically, manage those orders and remain informed about the workflow in real-time. Labor costs are reduced while situational awareness is increased for both entities. As awareness is increased, risk is mitigated, problems can be proactively avoided and sudden opportunities can be capitalized upon.

Truck dispatchers receiving the orders communicate digital instructions to drivers' smartphones using store and forward technologies to circumvent potential connectivity issues. As the drivers collect load data on their smartphone at the wellhead or other pickup point, it is automatically sent to the authorized stakeholders such as dispatchers, fleet managers, terminal operators or others. With unique and highly specific tank strappings for each tank provided by the E&P companies and automatic calculations enabled through the smartphone, a higher degree of volumetric accuracy is achieved while data is transmitted to stakeholders in real-time.

Utilizing the geo-location capabilities intrinsic to the smartphones as well as the load data and information from the vehicle's J-Bus, terminal operators are informed about the load details in advance of arrival, saving time and data re-entry when the vehicle arrives at the terminal. Errors are reduced and vehicle turnaround time is minimized. Blue-tooth integration of vehicle J-Bus data provide numerous advantages, not the least of which is Department Of Transportation compliance with Automatic On Board Recording Devices (AOBRD), and electronic Driver Vehicle Inspection Records (DVIR) as well as other vehicle-specific information. Geo-fencing and a wide variety of other features enable driver-initiated loads, decision points to assist in the selection of an optimal destination or route and other labor saving solutions to optimize the efforts of a mobile workforce.

E&P, marketing, and transportation companies all benefit from smoother order management and ticket management. The result is faster, easier, and more accurate run ticket reconciliation and a greater degree of situational awareness.

Outside of the operational benefits derived from these solutions, these midstream operators are finding additional benefit in terms of improving customer communications and relationships. As previously noted, when properly equipped, the truck driver can generate and communicate, via their wireless in-cab device (smartphone or tablet) an electronic run ticket while the crude is being loaded. Should the trucking company not take title to the crude, but are simply providing transport, the electronic run ticket is then used to generate invoices and pay statements. Perhaps more importantly though, is that run ticket information can be electronically delivered to the lease operator, providing them near real-time information as to their physical inventory and value.

If the purchasers at the lease receive the electronic run tickets in real time, or soon after, they can be provided with an accurate accounting of physical positions, enabling optimization of terminal operations, more accurate inventory management and right sizing of hedges. Integrating run ticket information to the company's ETRM system allows physical sales and purchase data to be instantly updated to best available from the field providing the company an opportunity to adjust delivery schedules in order to meet deal obligations. Additionally, the run ticket data that specifies the quality of the crude will further allow the company to identify and specify off-loading points in order to facilitate blending of off-spec crude loads at the terminal, ensuring delivered deal volumes are within contract specifications.

Data surrounds us all. What we collect and how we process and use that actionable information is rapidly changing. Problems that have plagued the oil industry for decades are being discussed, addressed, and resolved with cost-effective solutions that eliminate inefficiencies throughout the supply chain. In turn, profitability rises, and the ROI for data management and utilization accelerates.

This is only the beginning. Changes continue to be made, and improvements are being achieved faster than ever. As data is collected and analysis is made easier, trends begin to appear, laying the groundwork for predictive analytics within the oil and gas logistics field. Positive and proactive changes in the oilfields are now being initiated through analysis based on real-time data collected as far upstream as possible and utilized further downstream and throughout the marketplace.

ABOUT THE AUTHOR