Latest Oil and Gas News Russia

A networking website, designed by Heriot-Watt Petroleum Learning Centre at Tomsk Polytechnical University graduates to make personal connections, has developing into a popular forum for Oil & Gas Industry professionals.

The idea of website to save links between Heriot-Watt Centre graduates in Russia originally was implemented guestbook by Gennadiy Fedorchenko (PE 2004). Anton Baluev (PE 2004) who became main website administrator together with Almaz Mullagaliev (PE 2003) and Roman Dzema (PE 2004) had developed guestbook into forum - with sections created according subjects and number of questions at forum. Further, as number of registered users was increased Vladimir Volkov (PE 2004) was started to serve as main moderator. Gradually, personal communications between gradutes has developed into discussions about professional subjects which attracted employees of different petroleum companies.

For example, career-related discussions had led to the development of a section at forum about career development in the oil and gas industry. Also, Petroleum companies readily started to post new job openings in "Oil and Gas Vacansies" section, where professionals publish their CV's for review and job search. Technical support for Schlumberger and Roxar software users is also provided through created for that purposes section. A special section was also designed for graduates applying to study at Heriot-Watt's Approved Learning Partner in Tomsk which also delivers Petroleum Engineering and Reservoir Evaluation & Management MSc courses, together with an increasing number of Petroleum Industry short courses.

http://heriot-watt.ru is one of the most popular and well-known forums in the Oil and Gas Industry in Russia, according to forum statistics data. Over 5,000 users are registered currently including about 1,000 users who visit the website each working day. There are now more than 2,000 visitors per day. Alexei Vashkevich, Deputy General Director of Samara-Nafta (Hess Corporation), first year graduate of Heriot-Watt Centre in Tomsk (PE 2002) commented: "Heriot-Watt University and the Petroleum Learning Centre in Tomsk provide a unique chance for Russian technical graduates to get a leading western education, which allows students to get a modern and alternative view on field development, to learn western technologies and management standards and allows them to successfully implement these in Russian or foreign Oil & Gas companies. The growing popularity of Heriot-Watt in Russia is becoming apparent". "Heriot-Watt.ru has already become a popular network source among the broad circle of oil & gas specialists who can publish job vacancies, discuss a wide scope of problems and get answers on questions." The site administrators are considering developing the forum further for use in professional network development in Russia and all over the world. For more information about Tomsk HW Learning Centre visit: http://hw.tpu.ru and for more information about the forum for Oil and Gas Geologists and Engineers or to register, visit: http://heriot-watt.ru

Labels: Heriot-Watt Petroleum, rogtec, Russia

posted by The Rogtec Team @ 11:13  0 Comments

By V.Yu. Andrianov, DATA+ LTD

Any competitive business today just cannot do without computerized systems that have learnt to store and process information on business targets and procedures much better than humans. If accurately configured, an information system may be none the less valuable for a company than its basic production infrastructure assets.

Geoinformational systems (GIS) are one of information technology domains intended to handle spatially referenced information. Even though the technology is more than a dozen years old, it is in the most recent years that a burst-like integration of GIS into a range of industries has occurred. Contributing to the phenomenon are qualitative growth of computer processing power and progressively lower data storage cost, which is critical for handling spatial information, along with emergence of popular mapping internet services, such as Google Maps, personal navigational systems, let alone the simplicity of taking coordinates by means of global satellite systems of GPS type.

Oil and gas industry has long started using GIS as a primary instrument essential for geologists and ecologists. Thus, USGS has nowadays developed into a major consumer of commercial GIS software. A kind of stereotype has even formed with regard to geoinformational systems as of "something to deal with geology".

Yet, spatial information is not entirely confined to mineral resource deposits and geographic maps. In fact, a substantial portion (if not all) information describing oil and gas companies' assets and business prospects is spatially referenced, from core-taking in a specific well to filling stations, from license areas to marketing strategy differentiation. Today, the leading developers of database management systems (DBMS), such as Oracle, IBM, Informix and others realize that spatial data is an important information type that needs to be supported by corporate level systems, which is exactly what their latest products can do.

One should not confuse geoinformational systems with computer-aided mapping systems. GIS is not just a map on a PC display, but a means of cartographic imaging a variety of data, as well as a method to analyze data using spatial distribution of objects and processes. Invention of centralized facilities to store spatial data and multi-user access enabled the leading GIS software developers to bring the technology to corporate level offering the opportunity of integrating, based on spatial location of objects accounted and controlled, practically any data and business processes handled by services and subdivisions of major vertically integrated companies.

GIS has a wide spectrum of applications in oil and gas industry. Here are several of its major segments:
- geology, prospecting and management of fields' life cycle
- cadastre, evaluation and management of licenses, land allocations, environmental payments
- monitoring and spatial analysis of production profile to maximize oil recovery
- logistics, freight scheduling and vehicle fleet operations management
- marketing, sales area competitive analysis and distribution system optimization
- evaluation of holding company internal competition, development planning
- integration of aerospace surveys GPS-measurements into corporate business processes
- emergencies: on-line response and environmental damage assessment

One cannot help wondering as to "how in the world can this versatile technology work so well in those multiple applications?". The answer is: just as easily as standard database management systems do. The "geo-" prefix simply indicates that from now on these DBMS will store spatial component of the data, granting to users new opportunities previously out of reach. It should be noted at once that it is more than plain quantitative capacity growth, but a qualitative leap, almost comparable to recovery of eyesight (the dramatic effect is normally dampened as changes are introduced gradually, in a step-by-step manner, and yet exclamations like "Wow! We never imagined such things were possible!" - are not uncommon).

Now let us take a quick look at how geoinformational systems are typically applied in oil and gas industry. Geologists and surveyors have used GIS since long ago, because they have to deal with maps anyway. However, in contrast to conventional maps that may take many days to plot and print out, GIS can instantly produce maps of any kind and nature. More importantly, the maps thus produced can contain not only static topographical data, but also the results of spatial analysis just carried out in the same media where the maps are being created. Armed with digital maps carrying topographical and geological information, aerial shots, geographically reference, seismic profiles etc., and a full-featured GIS, a specialist can make a full-scale analysis of a vast acreage to spot oil and gas occurrence, estimate the reserves and prepare a report constituting a basis for decision-taking. It means that GIS is a facility to generate new information out of the existing database capable of presenting the output data in the form of maps so that it takes several times quicker to search for and evaluate prospects.

Developing a field is not a cheap undertaking, so the operator may substantially profit optimizing the whole business. Geoinformational systems can find the best well locations and compose access road network, calculate the construction cost of such roads and damage compensations payable to the government for land use and landscape development. Noteworthy, GIS can help you not just calculate those variables, but also minimize them taking into account plenty of factors: forested area locations, specially protected preserves, other valuable vegetation, soil types and wetlands, potential vicinity to inhabited areas and the existing service lines, etc. This is the way geoinformational systems help find the best planning solutions for field development and, owing to quick assessment of multiple factors, to promptly update plans if any changes are required.

Practically all commercially available GIS packages today include 3D facilities. The most advanced ones are capable of not just seeing a perspective view of the surface, but can also create a 3D image featuring both surface and subsurface objects. Coupled with wellhead GPS coordinates, deviation survey data can be processed to make a spatial well path image in an ensemble with a map, photo shots and other objects. One can actually see boreholes of many wells running deep underground, crossing specific formations, tapping on oil-bearing horizons etc. Logging data can be used to present a 3D picture of deposits, thus enormously facilitating field development planning and monitoring. When used in combination with geological and other special applications, multipurpose GIS packages can "work wonders" on usual PC's, which is far less expensive than VR-rooms that up till recently used to be the only method of "diving" into the subsoil.

In addition to pure visualization, geoinformational systems include measurement-based analysis facilities capable of designing spatial images though inversion, while the newly invented animation techniques can show a phenomenon as a moving picture. Such techniques are effectively applied to monitor spatially distributed dynamic processes. A good example is water injection typically practiced in oilfields to maintain formation pressure.

To keep producing wells from premature production of pure water, water flooding front movement must be continuously monitored so that timely steps can be taken to adjust water injection points and rates. It is critical that the on-going process is tracked down, which can be best achieved through animation. A spatial image of water flooding is obtained based on well test data and mixed production content readings constantly monitored through interpolation is made in GIS, while animation shows the modifications occurring to that image with time. This is how specialists can have a visual perception of the flooding in progress meaning they can act with utmost accuracy and efficiency. This results in the highest ORF's with minimum oil recovery enhancement costs.

Industrial infrastructure and facilities are generally operated using special information systems (EAM, ERP). As major companies often operate sites scattered around vast areas (including those located abroad), the accounting functions of the above systems in combination with GIS geographic location data give the managers a chance to have a better grasp of both the entire stock of production resources, and its separate pieces. The leading world's software suppliers support their systems' communication modules with the most advanced assents and production management systems (for instance, SAP R/3 and ArcView GIS). Russia's home IT products developed by oil companies are fairly common, too. They integrate access to such systems in client user applications. Access from GIS environment to accounting data makes it possible for specialists to see and assess interrelated effects of industrial (internal) and natural (external) factors. Thus, operations in the North of Russia must monitor permafrost melting caused by industrial activities. Inland plains run a risk of pipelines being flooded because of construction disrupted land runoff. Geoinformational systems can detect problem areas and identify risk-prone objects through use of aerospace shots and information contributed by accounting systems. Known as very productive is a combination with field survey data referenced to the main database by means of coordinates provided by GPS receivers. Thanks to the above opportunities contributed by site GIS site management solutions of better timing and quality become available, with reduced risks of emergencies or accidents.

Sales planning is the activity type for GIS to clearly demonstrate high investment efficiency. Retail sale locations and distribution oil tank farms layout must be based on spatial distribution analysis with regard to current and potential consumers account taken of competitor sale terminals. It is only at random that "Manual" methods can produce the best solution here, for there is a need to analyze several irregularly located factors in parallel. For example, in order to correctly deploy a filling station, one should mind population density, traffic level, taxation regime, land price, remoteness from supplier tank farms and other variables. Each variable will form an individual cost surface, while a weighted combination thereof will constitute a common priority surface, with "hill" peaks indicating locations most suited for new sales points, i.e. locations combining high demand level and low construction and/or operation costs.

Another illustrative example is optimizing tank farm supply zones and petroleum product delivery routes. For example, our company's experience has shown that demand fluctuations are typical of the way many oil tank farms have to operate often leaving them "underloaded". Redistribution of consumers serviced is a method to smooth out the load and reduce the number of oil tank farms required. If combined with optimized delivery routes, it can bring 20-30% savings with the same or even shorter average hauling time. As consumer environment tends to change (new consumers and competitors emerge, road network is upgraded etc.), periodic GIS-aided sales network optimization analysis allows to make timely adjustments to maintain the highest profitability possible.

There is one more interesting challenge resolvable through combined use of GIS and GSP technologies: tracking cargoes and traffic on-line with the purpose of dispatching them. It has been actively used in sea and railroad transportation, by forwarding agencies, in carrying hazardous and valuable loads. In addition to meeting the natural requirement of locating all freights, tracking is typically accompanied with a noticeable economic effect owing to psychological aspect as the drivers prefer to stick to their preset routes and become generally more disciplined. Recording motion paths allows for simulating actual situations in the future, which may be of use for traffic accident or emergency investigations, as well as to analyze and optimize traffic routes and schedules. To implement dispatcher center tracking function, a company has to install on-board computers on their fleet, to include a GPS receiver and coordinate transmitter, plus other optional navigational parameters. Messages can be relayed via cellular, satellite, transponder or other radio communication links to be finally received at the dispatcher center message server. This server receives messages from all carriers, processes them, sorts out and presents them in the form of trajectory and traffic schedule files. By interfacing the message server, GIS application can show transport vehicle movement either on-line or as a record, the image (if necessary) being superimposed onto any map in combination with any other user applied information. Trajectories and traffic parameters themselves may be used analogously with any other data: for spatial analysis, reporting documentation etc.

GIS multi-factor analysis facilities are not limited with search of optimum locations for prospective sites - they can also identify optimum trajectories connecting any two spots. This function is widely applied in road and pipeline design. It can account for any spatial distribution factors, such as ground profile, vegetation, soil types, water entities, inhabited areas, roads etc. The system is able to automatically find the best path to bypass restricted areas and/or bring the route through mandatory specified points. Having analyzed all factors, the system will propose one or more options of the best routes plus the corridor where cost fluctuations should remain within acceptable limits.

To conclude this introductory overview of GIS and GPS applied in oil and gas industry, it would be proper to make a mention of Internet and intranet map publication facilities, along with the novel server architecture of geoinformational systems. This technology accommodates GIS applications on the server so that users can interface them with a standard web browser. The advantage of this approach is that no GIS software has to be installed on user PC's (an operating system and a browser are sufficient), while the access is possible from the Internet (intranet) workstation. Information security of such distributed system is achieved through standard access limitation and data coding utilities. As means to configure such systems became available from the leading GIS providers, many oil companies (and not only Russian ones, for that matter) proceeded to actively introduce the technology for their in-house needs. The benefits it offers are evident: system administration as such is considerably simplified (all updates are effected on the server saving the administrators the trouble of visiting departments, branches etc.), a range of users widens up (mainly on account of managers and other employees who are not professional GIS users), a company's management is granted a handy visual cartographic aid to check current work status and the company's business results right on their PC's.

In summary, it should be noted that due to the capacity to integrate a variety of data and specialist systems enhanced by advanced analysis and imaging geoinformational technology carries a good promise to increase the efficiency of business run by oil and gas companies. The reduced time required to prepare informed decisions optimized through multi-factor analysis shortens payback period and, on many occasions, cuts total business owing costs. Similar to any other information technology, GIS is not a panacea: it can be productive enough only in the hands of qualified specialists subject to a comprehensive approach.

Labels: Data+, GIS, GPS, Oil and Gas, Russia, spatial informtion

posted by The Rogtec Team @ 17:54  0 Comments

From Exploration to Production in 12 Months

Often, when exploration is mentioned, it conjures up wells drilled in far-flung and remote parts of Russia, such as Southern Tyumen (Uvat) or regions in the far north (Bolshekhetsky). These Greenfield areas are critical to the Company's mid to long term growth, with limited potential for short term production; meanwhile, around half of TNK-BP's exploration activity occurs in Brownfield areas. These areas are typically within mature oil basins or close to existing fields (within 50 km)

The enabling technologies of cheap, modern, high-quality 3D seismic, its integrated and rapid interpretation and improved sedimentary understanding have allowed smaller oil traps to be identified, at the same time lowering their risk. Once discovered, these fields can be economically developed because they are close to existing fields, reducing tie-in costs and allowing use of existing infrastructure (i.e., roads and power) and facilities (i.e., oil processing and water injection), while the spare export capacity allows easy transport to market for the hydrocarbons.


This means that developments will cost much less than in new Greenfield areas, and their development and subsequent production can be achieved far more rapidly. The combination of advanced technology and available infrastructure allows smaller discoveries to come promptly on line where five years ago this would not have been possible.

In Orenburg, discoveries made over the last four years have been brought into production within 18 months and now contribute around 3 percent of Orenburg's production. This is set to grow significantly in the future.

TNK-BP's key Brownfield exploration areas are Orenburg / Samara and West Siberia (around Kamennoye (West KhMAO) and Samotlor (East KhMAO) respectively) (Fig. 1).




Application of Appropriate New Technology in Brownfield Areas

The use of new technologies and techniques to unlock the remaining potential of the Brownfield regions is key to their success, as overspending or slow turnaround easily erodes the value of these small projects.

Affordable, high-quality 3D seismic is only now being used within Brownfield areas of Russia for exploration. The quality allows smaller structures to be defined structurally, with significantly improved certainty and correspondingly lower risk. The seismic can be acquired quickly and processing in TNK-BP's Dedicated Processing Center (DPC) ensures clearest focus, quickest turn-around time and highest quality. In addition, it allows a direct link between the client (interpretation team) and the processors. In priority projects, fast-track processing can produce good-quality seismic cubes within three months of data delivery.

3D seismic is not just used to create an exploration well location but can produce 3D geological models even prior to drilling; this helps speed up appraisal and development planning post discovery. Modern interpretation packages (for example, Petrel*) are capable of running on a laptop computer and can be used to rapidly interpret the new seismic. Framework horizons can be produced in an afternoon when five years ago it would have taken a week to produce the same results. This allows the interpreters to easily refine maps and also frees them up to focus on the details around prospects. In addition, the software allows the entire exploration team to work on the data from maps based on seismic and geological studies to build reservoir models. This level of integration allows numerous data sources to be integrated into a single project, shared across the team, and results are modified rapidly.

Multi-disciplinary teams, sharing the same goals and sitting together, allow each team member to interact on the problem, giving their perspective and allowing the free flow of ideas. All this speeds up interpretation work and improves prospect generation and risk. The use of Visual Modeling Center (VMC) style forums to share information and results with regionally based teams in real time has improved communication and built trust.

The need for geological understanding of the entire petroleum system from regional to prospect through Gross Depositional Environment mapping (GDE) has led to refocusing of exploration analysis to include reservoir distribution along with previously overemphasized structural controls. The understanding of why oil is or is not present in certain areas allows better predictions of the sweet spots for exploration and appraisal (E&A) activity and license acquisitions.

Exploration Success in Orenburg

Orenburg region can be taken as an excellent example of Brownfield E&A where exploration discoveries have been fast-tracked into responsible production within about 12 months. Orenburg is an oil-rich region and part of the enormous Volga-Urals basin which has been in production since the 1930s and, prior to the discovery of West Siberia in the early 1960s, was the main oil and gas production area of Russia.

The assumption is that this is a very mature basin with little exploration potential. Nonetheless, since the formation of TNK-BP in 2003, exploration in Orenburg / Samara has added 22 mln t of new recoverable oil reserves (classified as C1+C2). In addition, we currently have 9 exploration license areas, five of which have been purchased since 2004, and we have acquired 4,000 sq. km of 3D seismic. The regional GDE and composite common risk segment (CCRS) descriptions, typical modern exploration tools, were completed in 2006.

TNK-BP's 2007 plan is to drill 11 exploration and appraisal (E&A) wells and acquire 1,200 sq. km seismic. Many more license acquisitions and wells are planned. A simple statistical technique can be used to estimate the number of undiscovered fields. It suggests there could be more than 500 individual traps of between 6 mln t and 60 mln t OOIP (original oil in place) left to find within the Volga-Urals basin, giving a total OOIP of close to 6 bln t (risked).

Within Orenburg, there are a number of exploration discoveries that have either already been fast-tracked to production or are in the early stages of this process. These include the three successful discoveries around the Sorochinsko-Nikolsky license area which are all on their way to production, and the Buzuluk license area which is still in the exploration stage.

Sorochinsko-Nikolskaya Group of Fields

The license block of Sorochinsko-Nikolsky is located in central Orenburg. The fields have been in production for 40 years or more and are a series of domes, discovered without the aid of seismic tools. A modern seismic survey was acquired and, based on its interpretation, three major new prospects (domes) were identified (Fig.2).

Map of the existing and new domes within the group of fields

The first Borodinovsky dome was drilled in 2004-2005 by well 900, which was put on test production during the first half of 2006, producing 20,000 t of oil. Follow-up appraisal is planned and, once completed, the wells will then be turned to production. Subsequently, Verkhne-Nikolsky dome was drilled by well 901 in 2006, and Novo-Lvovsky by well 910 in 2007, and both plan to be in production this year. Follow-up appraisal is budgeted for 2007-2008 with approved pilot development plans. These discoveries have a total potential of about 10 mln t to 20 mln t of reserves between them.

Buzuluk License Area

This license project is still in the exploration stage; but a 1,100-square-kilometer, 3D seismic survey was completed in 2006 and is still undergoing processing. Numerous new prospects have been identified and wells are planned for late 2007, continuing on for five years, combining both new-play exploration and little "e" exploration and appraisal.

The planned development tie-up time is three to six months following discovery, with full appraisal within two years.

Specialists believe that this rapid turnaround time, coupled with existing capacity within the oil facilities, will allow significant value to be obtained from relatively small reserves. Thus, exploration activity does not deliver just long-term renewal projects, but within specific areas it can deliver near-term production as part of a framework of responsible field developments. Activity in Brownfield areas can deliver high-commercial-value projects that compete very favorably with their larger cousins in the Greenfield areas and help TNK-BP grow short-term production while retaining excellent capital returns.

TNK-BP: Bringing Cutting-Edge Seismic Technology to Russia

Forecasts show that in 2007 almost one-third of all 3D seismic surveys in Russia will be performed on the Company's order. In a five-year outlook, we plan to do at least 5,000 sq. km of 3D surveys per year. This work is expected to cost about $120 mln per year. Such major investments result from the fact that upstream development groups have come to realize the value of 3D seismic data and have committed to cover all major fields of TNK-BP with 3D surveys.

Marketing research annually performed by Seismic Technology Dept. of TNK-BP shows that over the last three years, the Company has been one of the largest customers of 3D seismic survey services in Russia. Modern seismic surveys are the most effective exploration method in the oil and gas industry; they also provide a key tool for optimizing development of current main upstream assets. The priority task for seismic is to reduce risks associated with drilling and add to the Company's reserves.

Among the main tasks currently faced is delivery of an integrated seismic program, which consists of exploration and development surveys. Another priority is collection of high-quality, world-class seismic data at minimal cost. In addition, TNK-BP pays a lot of attention to HSE compliance and introducing latest seismic technology.

To date, 3D surveys have covered about 35 percent of the total area of the Company's major fields. Since 2004, the company have systematically performed 3D seismic surveys on all major producing assets of TNK-BP, Samotlor, Vostochno-Urengoyskoye, Talinskoye, and Kamennoye fields. Last year, we started to actively implement 3D seismic in exploration for the first time. Prior to this, in most cases we used 2D survey methods that failed to properly delineate reservoirs and provide a good understanding of the relationship between the adjacent field and prospective structures.

Work to Obtain Quality Data

To ensure that the TNK-BP seismic program is successful, the Seismic Technology department has implemented an effective project management process. We have introduced a reporting system that uses the latest Internet based communications. Contractors use the system to report on work progress on a daily basis. Every day, the information on all projects is recorded in a single database for Seismic Technology. This allows us to trace any change and make appropriate balanced and effective decisions.

In addition to managing seismic operations, the Company controls the quality of seismic data to ensure that it complies with our high standards. Over the last three years, we have implemented a number of projects that substantially improved the quality of data:

Only the best contractors have been pre-qualified for seismic projects (Bashneftegeofizika, TNG-Group, Tyumenneftegeofizika, Petroalliance). These contractors have sufficient experience as well as equipment, financial resources and HSE performance.

Since 2003, the density of seismic data collected has tripled and is currently 115,200 traces per sq. km. This parameter quantifies the quality of data. Fig. 3 shows a sample of high-density 3D data.

New 3D seismic map from the top Tournaisian within the Buzuluk license area

Thanks to broad-band Internet connection between the contractor's office and TNK-BP, we were able to set up a continuous quality control of field operations and seismic data processing.
We have established a dedicated Data Processing Center (DPC) managed by global leader WesternGeco. This allowed us to consolidate and implement the best Western and Russian practices in seismic data processing. Good results from the DPC work have led to extension of the contract with WesternGeco for another three years in 2007.

In 2006, the Company implemented a practice of signing long-term contracts for seismic projects. TNK-BP has long realized the advantages provided by long-term contracting but started using this approach only last year. By using this approach, we can attract the best contractors in a very tight seismic services market, keep control over cost inflation, foster development of the seismic services market and manage and mitigate HSE operational risks. Other advantages of long-term contracting include detailed planning of the entire seismic survey cycle a year prior to the beginning of data collection (project feasibility study, scouting, seismic modeling). All this in the end helps to reduce the time between a first seismic shot and the start of drilling and hence reducing seismic cycle time.

Other Initiatives in 3D Seismic

Regardless of achievements, Seismic Technology continues to develop in terms of both project management and introduction of new technology. For more detailed planning of seismic projects, we use modern topographic data such as aerial photography images and LiDAR data (Light-Imaging Detection and Ranging). LiDAR is a technology that can produce extremely accurate 3D elevation models overlapped with aerial photography images in actual coordinated system).

We continuously work with our contractors on improving HSE performance. In 2006, for the first time in Russia, we have tested summer-season collection of 3D seismic data. This technology is no different from the winter method, but there are higher requirements to data acquisition systems and special vehicles are used that minimize the impact on environment. If application of this method proves to be successful, the Company will be able to increase the annual volume collected seismic data and therefore speed up the exploration and development progress.

Nicholas Whiteley, Team Leader, Brownfield E&A, Exploration, Technology
Dmitry Zolotarev, Chief Specialist, Brownfield E&A, Exploration Technology
Maria Konstantinova, Specialist, Brownfield E&A, Exploration Technology
Alexander Fokin, Chief Specialist, Brownfield E&A, Exploration Technology
Artem Zhukov, Chief Specialist, Seismic Technology, Exploration, Technology

Labels: 3D seismic, gas, oil, Orenburg, Russia, TNK BP

posted by The Rogtec Team @ 17:25  0 Comments

1. Operators are under increasing governmental pressure regarding environmental and tax compliance. What effect, if any, is this having on Baker Hughes's strategy for the region?

Baker Hughes has a global program that we have labeled "Completely Compliant", or we train 100% of our employees in Russia and around the globe what "Completely Compliant" means. It means complete compliance with all laws, both laws of the Russian Federation and other jurisdictions that apply, as well as compliance with our Health, Safety & Environmental Management System, and our Core Values. We work hard to ensure the health and safety of our employees and to be a responsible corporate citizen, not harming the environment.

We conduct regular and meticulous environmental and safety audits of our facilities. We pay our taxes promptly and properly declare the value of any imported goods or equipment.

From a business standpoint our Fluids Environmental Service (FES) provides safe handling and disposal of drilling fluids and waste cuttings.

2. At present there is a shortage of qualified personnel within the OFS market in Russia. Is recruitment of the relevant talent proving challenging?

This is a top issue for the industry in general and one which we face daily. Baker Hughes is growing very rapidly in Russia. Our number of employees, 98% Russian-speaking, has more than tripled in the past 18 months. This places a huge strain on the organization's ability to maintain our corporate culture and impart the level of skill needed to provide the excellent execution at the well-site that Baker Hughes is known for worldwide.

In response to this challenge we have taken several actions. First, we have geared up our graduate recruitment and cooperation programs with oil and gas faculties at leading Russian universities. Second, we have or will be commissioning training facilities in Noyabrsk and Tyumen to conduct both technical and non-technical training. Third, we have formal Employee Development and Succession Planning processes that identify areas of needed skill development and help develop actionable plans to fill the gaps. Fourth, this year we are sending some of our future leaders on foreign assignments to develop broader skills, learn new technologies and network into the global Baker Hughes organization. And fifth, we have begun looking outside the Russian Federation for Russian-speaking service technicians to help support our business growth.

3. Which product/technology line offered by Baker Hughes Russia do you feel will have the biggest impact in the region during the course of the next year to eighteen months?

There are many opportunities for Baker Hughes technologies to add value. A few of the more significant ones include:

• AutoTrak rotary steerable systems, which are now enabling Exxon-Mobil to drill 12,000 meter horizontal sections (a world record) on Sakhalin. Most of the world's longest horizontal wells have been drilled with AutoTrak technology. Likewise, our CoilTrak technology for Coiled-tubing drilling is being used very successfully to side-track in slim-holes in the Russian Federation, including under-balanced applications.
• Equalizer, an inflow control device that delays coning and subsequent water production, is currently being installed in Russian oilfields. Given that water-cut is common in produced fluids, this technology has a short payback time for our customers.
• Beacon Centers, now being established in Moscow and Noyabrsk, will make a significant contribution to our performance optimization efforts. They allow our experts to monitor well and job operations thousands of miles away. As many of our customers projects are in isolated locations and, as we have stated, the number of experts is limited, Beacon Centers allow our best engineers and technicians real-time data and the ability to intervene to optimize operations. Ultimately, their potential is far greater. For example, imagine a directional driller geo-steering a well in Eastern Siberia from a Beacon Center located in Moscow. We are already doing this in other parts of the world.
• And there are many, many more that are either being trialed right now in Russia, or are soon to be introduced to the market.

4. Russian Service companies are investing more and more into R&D in an attempt to compete with Western companies such as Baker Hughes. Do you feel the competition is hotting up?

We see the increased competition as a positive sign for the industry. Baker Hughes intends to build for the long-term in Russia. We have established a research center in Novosibirsk, where we do basic geoscientific research. We are evaluating expanding the scope of our own local R&D efforts. We feel there is opportunity for Baker Hughes to develop products specifically for the local markets here. That has been a critical strength of Baker Hughes' over our 100-year history, and we plan to apply that same approach in Russia. Ultimately, this approach gives our customers the best solutions at the most efficient cost.

5. How do you see the OFS market developing in Russia over the next decade?

The forthcoming decade will continue to be an exciting one for the oilfield service industry in Russia. We believe that the consolidation within our industry will continue. Some of the VIOC's have reiterated their plans to divest their in-house OFS units via trade sales or IPO's. Interest in acquiring smaller, and regionally based service providers will remain high, and Baker Hughes will consider such acquisitions seriously.

At the same time, our clients will place increasing emphasis on green field developments, featuring complex geologies and remote locations. Given the higher spread costs compared to the brownfields of Western Siberia, we expect the focus of evaluation to shift more to cost-in-use rather than tendered price. Service providers will continue to find ways to effectively apply both new and existing technologies to help contain the escalating cost per ton of production.

6. What role do you see Baker Hughes Russia taking?

Baker Hughes Russia will continue to develop as a major service and technology provider to our clients in the Russian Federation. We expect to be among the industry consolidators. We continue to invest in the infrastructure needed to support world-class operations. We will compete in all market tiers.

Labels: Baker Hughes, Interview, Mike Davies, Oil and Gas, Russia

posted by The Rogtec Team @ 15:13  0 Comments