Why The Office Simply Cannot Go Away: The Compelling Case For The Workplace

Tracy Brower, Contributor, www.forbes.com

We’re in the midst of the most significant reinvention of work in our time. We’ve proven people can work anywhere and the greatest social experiment—sending everyone home to do their work—has decimated barriers to working away from the office.

Some contend people are working with a reasonable level of productivity from home. And this is during arguably the worst-case situation for remote work: Being forced to work from home without choice, experiencing stress about the pandemic, sharing space with spouses or partners who are furloughed or also trying to work from home and finding time to educate children who would normally be at school—all of these create challenging conditions. Even so, people are getting work done—and could probably perform even better from home when the coronavirus abates, children go back to school and employees can return to a more typical way of life.

We can work from home with some level of effectiveness. We can meet using all kinds of technology platforms. We can stay connected to colleagues. We can perform our tasks. We can manage our work.

We can, but it’s just not the best idea.

It’s tempting for companies to conclude the office is irrelevant. Perhaps commutes, conference rooms and coffee bars aren’t really that necessary after all. With billions invested in real estate and maintenance of the workplace, companies would be missing something if they weren’t at least asking questions about its necessity.

But not so fast. The office simply cannot go away. It is necessary on multiple levels—for our effectiveness, for our sanity and for our humanity. It is unlikely work will ever go back to the way it was. In addition, many companies had productive approaches to remote work pre-pandemic, and global work has always required working together from a distance. Working from home offers some wonderful benefits—avoidance of a commute, positive impacts on the environment, more time with family and greater work-life fulfillment. Partly based on these benefits, it is likely companies will continue to encourage some level of work from home, but the best strategies combine working in an office and working from home. It is not an all-or-nothing. It is not an either-or. Deleting the office altogether is not the best option. The workplace offers all kinds of critical value—and it simply cannot—must not—go away. Here are five reasons why:

Humanity And Innovation

Humanity. The office is critical to our humanity. We are social creatures and we crave connections with other people—even at socially-distanced lengths. People may have different preferences for how much they work alone or with others based on their personality, but everyone needs some level of connection. Face-to-face communication contributes to all kinds of wellbeing including physical, cognitive, and emotional. On the flip side, a lack of human connection detracts from mental health and physical wellness. Some of this connection can be effectively facilitated by technology, but not all of it. According to a study by the Society for Human Resource Management (SHRM), 71% of people are struggling to adjust to remote work and according to additional research, people working from home are reporting mental health challenges. In addition, the longer people work from home, the more likely they are to report issues with sadness and fatigue. We need each other, and we understand ourselves based on our relationships with others. We are coworkers, colleagues and team members. Being together in the office feeds this need for togetherness whether we’re working side-by-side creating a new idea at a white board, solving a thorny problem around a conference table or acknowledging a friend across the cafeteria. Our proximity may need to be social distanced pre-vaccine, but hopefully post-vaccine, we can be closer. Either way, our humanity demands human connections and technology only meets part of our need. Being together in a work setting contributes much more significantly.

Innovation. The workplace is also critical to innovation. As humans we are fundamentally creative—and want to contribute what’s new and impactful. In addition, companies live and die on the ability to adapt and respond to customers and the market in new ways. Just three years ago, a who’s who list of companies significantly reduced their telework because the programs were impeding their ability to compete. We can be creative anywhere, but being together physically is so much more effective for stimulating thinking. We can build on each other’s ideas and not have the awkwardness that arises from delays when we’re interacting virtually. Successful ideation depends on rapid exchange of concepts and the flow of dialogue unhampered by fits and starts of never-fast-enough technology. Experimentation occurs based on the opportunity to roll up sleeves—literally—and work together on generating the novel and testing the unproven. Innovation is also facilitated by the unplanned encounters we have at the office. We have a new idea because we chatted with a colleague we don’t normally see, or we were inspired toward a new solution because of information we overheard standing in line to pick up lunch in the cafeteria. Perhaps those who do individual work can be successful working exclusively from home, but teams work better when they can come together in an office to blend their best thinking. Beyond co-creation that happens within teams, organizations require collaboration between and across teams—and nothing offers the same value as an office in achieving this goal.

Purpose And Energy

Purpose. The office also provides a critical sense of common ground. Any company knows that to deliver powerful results, they must ensure people have a sense of shared purpose and aligned objectives. Employees must be rowing in the same direction. The physical experience of place helps foster this sense of being in it together. But we’re currently without it, and the SHRM study demonstrates 65% of companies report they are struggling to maintain morale. From the earliest times, people gathered in places for common purposes—whether it was for celebration, mourning, childcare or learning. People have always come together to inspire a sense of community. In the modern world, the office offers this espirit de corps. We walk in the door with another employee, run into a coworker over (a socially-distanced) lunch or simply connect with someone while waiting for the elevator. We can get some of this through virtual connections, but not as effectively. Being together in a place reminds us we’re unified and are part of something bigger than ourselves.

Energy. The office provides for communication and it energizes. Disseminating and exchanging information can happen anywhere and everywhere and this has never been more true than in this age of social media and technology platforms. But there is something powerful about showing up together for a town hall meeting or an annual gathering—even when we are socially distanced. There is a rush in the feeling that so many people are in one place, sharing an experience. There is the power of laughter or applause or the focus that is demanded by presence. Being together virtually just doesn’t have the same magic—some people are engaged, some are distracted, some are multi-tasking and some are having technical difficulties. This disparity in focus can occur in person as well, but the influence of the crowd makes this less likely and the sociological concept of the bandwagon effect—when we’re swept up by the group—can be helpful to our enthusiasm and engagement in hearing a message.

Health And Wellbeing

Variety. We crave variety and the workplace provides it. We’ve proven to ourselves we can do everything from home. We can shop, eat, exercise, socialize and yes, we can work. But we want the variety that comes from getting out—to browse, enjoy a restaurant, go to the fitness club, gather with friends and go to our workplace. From neuroscience research, we know our brains are easily bored. We want the stimulation that comes from a diversity of experiences and an assortment of atmospheres. The office is one of these.

Movement and thinking. The office also helps us feel better. It allows for movement—across the campus or between conference rooms, and shifting postures throughout the day—something the workplace offers better than home—is best for your physical health. Movement has also been correlated with enhanced memory and learning. The physical workplace itself is also better for your thinking process. Having a place to go gives you a greater sense of time demarcation, reducing the disorientation that so many are reporting based on being (almost) exclusively at home. In addition, you avoid the cognitive challenges that arise from video conferencing (struggles to get in sync and fully read non-verbals). You also remember things better when you have more landmarks around you. The conversation from the atrium or the discussion you had in the hallway on the 4th floor tend to cement in your mind because of the physical markers around you.

Boundaries. We also need some healthy boundaries. Traditionally, we have talked about how to ensure a separation between work and home—how to leave work at the office and ensure a focus on life at home. But through the pandemic, the opposite has become true. People benefit from leaving home at home and coming to the office to focus on work. Work is a part of life and a full life embraces the effort that comes from making a contribution through whatever kind of work we do. Going to an office provides the opportunity to immerse in work with less of the distractions of home.

Talent And Engagement

Talent. The office attracts talent. Much of company culture is intangible. It is norms and values and assumptions, and it is “the way things get done around here.” But the workplace is a powerful way to demonstrate culture in a more tangible way. Place is the most visible artifact of culture. The lobby communicates a sense of a company’s mission. Gathering areas demonstrate the value it places on collaboration and connection. The work café shows employees their experience matters. The windows, daylight and views are a subtle depiction of the company’s emphasis on wellbeing and its ties to the community. All of these are powerful signals about an organization’s values and priorities. These are the beacons that attract talent and the messages that influence people’s engagement over time.

Engagement. Being in a physical workplace also helps reduce brain drain. Research has demonstrated people are more likely to have side hustles when they’re working from home so the chance of losing talent to the gig is greater. In addition, when people are home, they are more distracted and may be more likely to do non-work tasks during the day—from online shopping to surfing social media accounts. People working from home also admit to reduced likelihood of following procedures to protect company data and 84% of IT professionals say data loss is a significant concern with people working from home. Finally, people may be less engaged from home simply because they’re more distracted. Rather than being together in the workplace pitching in on a key project, they may be folding laundry during your meeting or responding to email during a critical work team discussion. The SHRM study finds 35% of organizations are reporting reductions in productivity and a study from the American Journal of Political Science finds women are disproportionately disadvantaged in terms of the ability to devote time to their work—and to be optimally productive. All of these are risks which are mitigated by being together in the office.

Empathy And Culture

Empathy. Empathy and trust are enhanced with physical presence. Team members who are regularly together can more easily stay attuned to each other —to share in positive events, offer support during struggles or learn from each other. Trust is built through proximity, and according to MIT, “physical distance can turn into psychological distance.” One study of 1,153 people showed a deterioration of team dynamics when people worked remote. We don’t trust what we don’t understand. More regular interaction can help us make sense of people’s responses, and more greatly appreciate their point of view. When we see each other more frequently we tend to identify with others and give them the benefit of the doubt. Social capital is the goodwill, fellowship, links and shared understanding that allow us to work together most effectively—and this is built more effectively when people are together. The alternative is the depreciation of social capital that can result when people don’t have access to the power of place. Leaders too can more easily focus on employees and their needs. Rather than having to check in formally, they can easily see non-verbal signals and understand when an employee has a question or needs guidance. All of this can happen virtually, but not as easily. When relationships require more effort, there is risk they will erode, a challenge avoided in the shared workplace.  

Culture. Without the chance to be together at the office, the SHRM research demonstrates more than a third of companies are having difficulties with their organizational culture, and a study by Prudential points to cultural decay which may result from an exclusively work-from-home approach. Culture is significantly determined by the worst behavior it will tolerate. Companies aren’t managing culture, they are managing behaviors in terms of what they encourage, discourage or reward. While leaders can still reinforce actions and hold people accountable via technology platforms, it’s more difficult and there is a higher likelihood they will miss opportunities to reinforce and recognize great contributions or to guide and manage actions which may not be aligned with cultural values.

The Bottom Line

Working from home will likely never go away and this is a good thing. It offers plenty of benefits, chief among them, work-life fulfillment. But the workplace must also not go away. It is critical for individuals, teams and organizations. In summary the office provides:

  • Humanity and innovation
  • Purpose and energy
  • Health and wellbeing (including variety, movement and thinking, boundaries)
  • Talent and empowerment
  • Empathy and reinforcement of culture

These benefits hold even in a socially distanced near term office, and especially in post-vaccine workplace.

We can do so much from home—and do so relatively effectively and productively—but it’s just not ideal. We’re better when the office is part of our holistic work experience—in addition to working from home. The workplace had a place in our businesses, our society, our communities and our lives—a place we must maintain.

Technology Speeds Headlong Toward the Edge

Adam Wilson, Special Publications Editor | 24 February 2020

The term “edge computing” may be relatively new, but the concept is not. Even the oil and gas industry, notoriously slow on technological adoption, has been working on the edge for some time, although it only recently started using the term.

“Edge is not new for us,” said Dave Lafferty, president of Scientific Technical Services. “Conventional sensors are actually edge devices.” In fact, “a rig is the ultimate edge device,” added Andrew Bruce, chief executive officer of Data Gumbo, “because you’ve got everything right there.” They were speaking recently at the second annual Edge Computing Technologies in Oil and Gas conference in Houston.

Edge computing is simply the use in the field of a computer that communicates, either wirelessly or through wires, with an enterprise site somewhere else. Connecting devices to these computers provides advantages such as reduced bandwidth and latency. “Rather than mindlessly streaming data up to the enterprise, what you can do is process that data locally and then send refined results back up to the cloud or the enterprise,” Lafferty said. “That can greatly reduce the amount of bandwidth that you need.”

These computers can also perform some autonomous actions. “It can be very simple, maybe just things like a mean or a standard deviation, to very complex analytics,” Lafferty said. Having certain actions performed autonomously, he added, “means you can spend a lot less on your telecommunications.”

Security can also be enhanced at the edge. “Now that you have the horsepower in the field, you can do things like encryption and certificates,” Lafferty said. “Now you have the tools where you can actually have a high degree of integrity.” He added, however, that security should be “built in, not bolted on. What I see is most projects fail because they don’t consider security until the very end, and then they slap a firewall in front of it and call it good. And, of course, it doesn’t pass the audit.” 

One of the greater benefits of edge computing is its ability to facilitate real-time analysis. “Real time is key,” said Hani Elshahawi, digitalization lead for deepwater technologies at Shell, “and, because real time is key, it favors the edge.”

As with any technological advancement, a few hurdles stand in the way, and most boil down to cost. To begin with, the cost of deployment at scale keeps a lot of edge projects from getting off the ground. Lafferty explained it this way: “Someone in isolation in some lab somewhere does five devices, and the boss says, ‘Great! Now let’s deploy 5,000 of them.’ Well, I can’t do that. It took me 2 years to get all this working.”

The cost and complexity of implementation is just the first hurdle. Once the system is deployed, the hurdle created by the cost of ownership looms. “Now that you have things like Linux out there, it has to be patched,” Lafferty said. “If you’re not patching, you have security issues. You have software-defined controllers that you’re pushing software back and forth and updates. So you have a lot of complexity in the field, and if you’re driving out there with a USB stick to reflash your device, it’s going to cost you between $500 and $1,000 per update times however many devices you have in your operation. You can see how quickly that value proposition goes away. If you’re offshore, it’s closer to $10,000 an update.”

Countering the cost hurdles are strong capabilities, untapped potential, and enabling concepts and technologies. Many edge devices have been around for years, although their contributions have been minimal. “We have a huge amount of embedded systems that we don’t take advantage of,” Lafferty said. “Every motor, every engine that we have has some sort of CAN [controller area network] bus on it, a Cat [Caterpillar] datalink or things like that. And these things take about 300 to 400 readings per second. It’s a whole wealth of information that we’re not utilizing. And, to unlock that potential, you really need edge because you need to 1) get it off the iron, but 2) put it in a form that’s useful.”

What Lafferty calls “software-defined controllers” can increase the usefulness of edge computing. Also called universal well controllers, these are pieces of hardware that can perform different functions, depending on the software that is loaded. “So, now you don’t have specialized pieces of equipment,” he said. Using artificial lift as an example, Lafferty said, “you initially would run the well on gravity drain, so maybe all you’re worried about is a flowmeter. But then, as you go to ESP [electrical submersible pump], you want an ESP controller; you just put software on that same device, and now it operates as an ESP controller. And then you transition to rod lift, you take that software and load the rod-lift controller software. So, one device can follow the asset along.”

Lafferty pointed out that these software-defined controllers tend to consist of commodity hardware using commodity operating systems, rather than proprietary, “which means it’s dirt cheap.”

The concept of “containers” also can boost usefulness at the edge. With this concept, all devices contain their own copy of the operating system, meaning that, if one crashes, it doesn’t take the others down with it. These containers also have their own container input/output, “which means that I can now, very discretely, control who that piece of software talks to,” Lafferty said. “With containers, you can bring in another instance of a container with just one instruction. So, you can actually do an update. Say you’re flying a drone, [you can] update the guidance system while it’s in the air using containers. It’s that quick.”

While some edge devices may already be in place, and vast quantities of data already are being gathered, the ideal amount of edge computing to be used is still being debated. “Many have been hypothesizing that the edge will eat the cloud,” Elshahawi said. “I think it will eat part of it.”

Some say all collected data should be streamed to the cloud to be handled offsite. “Then you had a lot of edge people saying, no, you don’t need any kind of enterprise. We’ll just do everything in the field,” Lafferty said. “But, in fact, the answer is yes to both.” The immediacy and proximity to the data source makes some actions more appropriate for the edge, Lafferty said, while, for other more local trends, sending refined data up to the enterprise site makes more sense.

Another argument for processing data on the edge is the burden of moving large quantities of data to an enterprise site through the cloud and processing it there. Lafferty gave the example of a program that records high-frequency vibration data. “High frequency” here means 360 vibration measurements for every turn of a crankshaft. “If you tried to send that amount of data up through the cloud and process it in the cloud, it just wouldn’t work,” Lafferty said. Instead, the program in Lafferty’s example sends that information to a local controller, where a model is used to compute about 80 parameters. These parameters, which include device health and performance and maintenance indicators, are then sent to the enterprise site to be added to dashboards for workers to review. “This is a really good example where you can leverage both the local edge processing to refine the data but then send that refined data up to the enterprise such that it becomes an actionable form,” he said. “And now you can start to see trends across your operations.”

All of these edge devices and activities require a fair amount of orchestration, which, in this instance, means automating updates and security. “It’s very important,” Lefferty said, “because doing five is easy, doing 5,000 is hard. And if you don’t have orchestration, if you don’t have a central management of things like your network, your security, your updates, it’s almost impossible to get value out of edge.”

2020 IADC/SPE International Drilling Conference and Exhibition

For more than 30 years, the IADC/SPE International Drilling Conference and Exhibition has brought together industry professionals to share ideas to advance our scientific understanding of drilling in oil and gas E&P.

The event attracts operator companies, contractor firms, and service companies to address challenges and deliver improved performance. Join Ensearch at this conference as we learn, network and help solve the industry’s most intriguing challenges!

IADC/SPE International Drilling Conference and Exhibition 3–5 March 2020 | Galveston Island Convention Center Galveston, Texas, USA www.drillingconference.org hashtagoilandgas hashtagspe hashtagdrilling hashtagenergy hashtagoffshore

Drilling: What Can We Do To Thrive?

January 8, 2019

Editor’s note: This is the first of a series of articles in which SPE’s technical directors comment on the state of their industry sector heading into 2019.

“You can’t beat vendors down for­ever,” said Jeff Moss, SPE’s Technical Director for drill­ing. “Sustainable efficiencies are one of the big drivers now. First it was ‘get it cheap and survive,’ now it is ‘what can we do to thrive?’ ”The cost of drilling services and supplies has finally started rising. After talk­ing about finding ways to build lasting efficiencies into these jobs, it is time to make that happen.

The opportunities for lasting increas­es in efficiency involve people, machines, and digital possibilities.

“For people, I mean training and auto­mation” to increase the capabilities of drillers, Moss said. This will require an understanding of the physics of drilling so that drilling can be done more efficiently.

Digital controls are now possible on most rigs since the deep downturn trig­gered a purge of the rig fleet, eliminat­ing older rigs that did not have modern control systems. As demand increas­es, some of those older rigs are being upgraded to meet the standard.

Still, there are potentially valuable innovations that are stalled by standoffs between buyers that do not want to pay for things unless they know it works and sell­ers who are not willing to invest in devel­oping innovative products without evi­dence that there are buyers.

One possibility for breaking that jam would be for drilling contractors who believe that innovation can yield sig­nificant benefits to begin offering to drill wells for turnkey (fixed-price) con­tracts, Moss said. These contracts would reward efficient drillers. He acknowledg­es that changing the long-accepted status quo would not be a simple transition.

Big data offer promise and prob­lems. “A lot of data are very question­able. Some are good, some not so good, and layered on top of that is an ongo­ing debate about who owns it,” Moss said. The industry will have to work out when it makes sense for an operator to maintain sole ownership—downhole data on the reservoir is one—and when there is value in sharing—a driller needs data related to equipment failures to reduce downtime.

The word automation is associated with machines replacing humans. Moss sees automation as a way to improve operations because machines can do the intensive computation needed to turn a flood of data into constant corrections.

Digital control of the weight on bit can free the driller to focus on managing the crew. Moss said that is an example of “automation to enhance capabilities of people … not to replace people.”

USGS’s Largest-Ever Assessment of Continuous Oil Potential: Permian’s Wolfcamp-Bone Spring

10 December 2018

Production and proved reserves in the Permian Basin’s Wolfcamp Shale and Bone Spring Formation are reaching new heights, and a new assessment from the US Geological Survey (USGS) indicates the industry is just scratching the subsurface when it comes to what may be technically recoverable.

USGS estimates the Wolfcamp-Bone Spring in the Permian’s Delaware Basin of West Texas and southeastern New Mexico holds 46.3 billion bbl of oil—more than double the agency’s 2016 assessment of undiscovered, technically recoverable continuous oil resources in the Wolfcamp Shale of the Permian’s Midland Basin.

The Wolfcamp consists of interbedded, organic-rich shales and carbonates spread across the Permian, but the Wolfcamp is thicker, deeper, and more thermally mature in the Delaware than in the Midland, USGS explains in the assessment. The Bone Spring, which is time-equivalent to the Spraberry Formation in the Midland, is made up of alternating sandstone, carbonate, and shale cycles.

“Changes in technology and industry practices can have significant effects on what resources are technically recoverable, and that’s why we continue to perform resource assessments throughout the United States and the world,” said Walter Guidroz, program coordinator for the USGS Energy Resources Program, in a news release.

The Delaware Basin Wolfcamp-Bone Spring are also estimated to contain 281 Tcf of natural gas and 20 billion bbl of NGLs.

In putting together the assessment, USGS reviewed data from IHS Markit’s Enerde and ProdFi databases to glean information on well landing zones, production, and unit depths and thicknesses. It focused on six continuous “assessment units” in the Wolfcamp and five in the Bone Spring, estimating the Wolfcamp A has the most undiscovered, technically recoverable resources at 13.2 billion bbl, followed by the Upper Wolfcamp B at 9.2 billion bbl and Third Bone Spring at 6.7 billion bbl.

Just a week ago, the US Energy Information Administration credited the Wolfcamp-Bone Spring as a primary reason for US proved oil and gas reserves hitting all-time highs in 2017. The combined play earned the distinction of having the most proved oil reserves and highest oil production of any US tight play.

Rice Global E&C Forum

As the crude oil prices fell in 2014 from high above $100/bbl to nearly $30/bbl in early 2016, most of the Exploration & Production (and associated hydrocarbon sectors) capital spending dropped as well. Since early 2017, for most part the prices stayed above $50/bbl and have firmed up above $60/bbl range since late 2017. This in turn has resulted in increased capital spending in the hydrocarbons industry. Engineering & Construction (E&C) businesses saw a contraction of business as oil prices fell. With growth in capital spending, we feel that E&C industry is finally “Turning the Corner”. Crude oil price escalation period from 2006 to 2014 led to significant increase in escalation in cost of capital programs and these programs were justified based on high crude price environment. Post 2016 timeframe, owners and investors are also expecting better capital efficiency for these capital programs and have challenged E&C and services companies as well as suppliers to reduce the costs. We will discuss E&C industry’s responses to these challenges and how industry is preparing and positioning in a highly competitive landscape.

 

PANELISTS:

  • Don Bari, VP, Technology and Analytics Group: Oil Markets, Midstream, Downstream and Chemicals, IHS Markit 
  • David Claggett, Senior Vice President, OGC Markets and Strategy, Kiewit Energy Group
  • Mark Coscio, Vice President – Petrochem Operations, McDermott
  • Frank Dishongh, Vice President and General Manager – Houston Operations, Fluor

ModeratorSanjeev Kapur, Apex PetroConsultants

2018 Deepwater Executive Summit, Nov. 8, 2018

Introducing the Inaugural
Deepwater Executive Summit

We are reaching a critical “Turning of the Tide” in the deepwater industry with Final Investment Decisions under greater scrutiny than ever before. A number of projects are starting to move forward, but the dynamics have changed and not all projects are a given.

Both Operator and Service Company executives involved in the global deepwater industry will be joining us for this unique event, it should represent an ideal opportunity for you to network with your peer group, learn about what others have to say about the evolving deepwater industry, and share your valuable and unique insights.

The goal of the Deepwater Executive Summit is to facilitate moving the industry forward through shared learnings, best practices, and networking amongst industry leaders.

Join us November 8, 2018, at The Westin Houston, Memorial City Hotel for the inaugural Deepwater Executive Summit!

How Will Deepwater Continue to
Attract Investment?

DES is a must attend event where Operators large and small will discuss: the dynamics driving ‘cost’; their drivers & commitments in deepwater; the allocation of capital across their oil & gas portfolios; and insights into how they are shaping their businesses for the future.

Adrian Luckins of BP’s Global Projects Organization will lead our plenary session with Majors and their assessment of the deepwater opportunity from an Integrated Oil Company perspective.

New Speaker Announced

We are pleased to be joined by Tim Duncan, President & CEO of Talos Energy, who will kick-off  “A Perspective from Independents” where he will join Kevin Bourgeois of Kosmos Energy in discussing the value proposition of Deepwater for Independents.

Talos and Kosmos will join BP and Total in our Operator Forum scheduled after lunch where their respective supply chains strategies as well as the sectors’ many challenges and opportunities will be discussed.

Thank You Sponsors

Sponsorships are filling up fast!  Thank you to our valued sponsors for supporting our event:

  • Wood – Diamond Level Lanyard Sponsor
  • Benthic – Gold Level Lunch & Notepad + Pen Sponsor
  • Oceaneering – Gold Level Water Bottle Sponsor

For more details please visit www.DeepwaterExecSummit.com

ExxonMobil, Guyana “Hit the Jackpot”

31 August 2018

ExxonMobil made its ninth discovery offshore Guyana, possibly creating the greatest value of any offshore basin in the Americas.

This is the company’s fifth discovery on the Stabroek Block in the past year and proves a new play concept for potential development. The Hammerhead-1 discovery encountered approximately 197 ft (60m) of high-quality, oil-bearing sandstone reservoir. The well was safely drilled to 13,862 ft (4,225m) depth in 3,373 ft (1150m) of water.

“The Hammerhead-1 discovery reinforces the potential of the Guyana basin, where ExxonMobil is already maximizing value for all stakeholders through rapid phased developments and accelerated exploration plans,” said Steve Greenlee, president of ExxonMobil Exploration Company. “Development options for Hammerhead will take into account ongoing evaluation of reservoir data, including a well test.”

The growing potential of Guyana has not gone unnoticed. “Guyana is set to create the greatest value of any offshore basin since the downturn,” said Maria Cortez, Latin America upstream senior research manager at consultancy Wood Mackenzie. “ExxonMobil’s latest discovery, Hammerhead, is another play-opener and adds to more than 4 billion BOE of reserves through an exploration program with a success rate that now stands at 82%.”

There are 18 prospects left to chase in the Stabroek block, and the project will only get bigger, Wood Mackenzie says. “But this is high-risk exploration and there are development challenges that range from building the required infrastructure to ensuring good natural resource governance, Cortez said.

Guyana’s portion of the basin is set to create the greatest value of any offshore basin in the Americas, Wood Mackenzie says, but the country must overcome several challenges and risks to reap the full benefit of this oil windfall. Priorities include developing the institutional and regulatory framework to manage the emerging sector.

“Guyana has hit the jackpot,” Cortez added. “If this small South American nation, with a population of about 750,000, can properly manage the billions of dollars of revenue about to come its way, it may become the richest corner of the continent.”

Hammerhead-1 is located approximately 13 miles southwest of the Liza-1 well and follows previous discoveries on the Stabroek Block at Liza, Liza Deep, Payara, Snoek, Turbot, Ranger, Pacora, and Longtail. Those previous discoveries have estimated recoverable resources of more than 4 billion BOE discovered to date, and the potential for up to five floating production, storage, and offloading (FPSO) vessels producing more than 750,000 B/D by 2025.

ExxonMobil said there is potential for additional production from significant undrilled targets and plans for rapid exploration and appraisal drilling. A second exploration vessel, the Noble Tom Madden, will arrive in Guyana in October to accelerate exploration of opportunities and begin drilling at the Pluma prospect 17 miles from Turbot.

Liza Phase 1, which is expected to begin producing oil by early 2020, will use the Liza Destiny FPSO vessel to produce up to 120,000 B/D. Construction of the FPSO and subsea equipment is well advanced. Pending government and regulatory approvals, Phase 2 is targeted for sanctioning by the end of this year. It will use a second FPSO designed to produce up to 220,000 B/D and is expected to be producing in 2022. A third development, Payara, will target sanctioning in 2019 and use an FPSO designed to produce approximately 180,000 B/D as early as 2023.

Growth in Offshore Activity Could Lead to Recruitment Boom

Adam Wilson, Special Publications Editor | 

The past years’ negative trend in employment in the oilfield service industry is leveling out. Now, as new offshore projects are approved, the need for offshore workers is expected to grow, which could lead to a large expansion of recruiting efforts, according to the research firm Rystad Energy.

Although the workforce saw a 35% reduction between 2014 and 2016, the overall headcount at the top 50 oilfield service companies remained stable from 2016 to 2017 (Fig. 1).The lack of change in total is a result of increased hiring by companies working in the North American shale combined with continued, if more modest, cuts for companies working offshore.

Companies involved in the North American shale industry faced especially large cuts from 2014 to 2016; however, these companies were the ones adding to their workforce last year. Halliburton and Nabors Industries, both large companies heavily exposed to the North American land market, expanded their workforces by 10 and 5%, respectively (Fig. 2).Among smaller companies with a strong focus on fracturing services, Trican Well Service nearly doubled its workforce and RPC increased its staff by 40%, including rehiring employees who had been let go. Aggregate hours worked within support activities for oil and gas is now back at the same level as in April 2015, which is just 15% lower than the peak in December 2014.

As employment in the oilfield service sector overall remained unchanged, growth within North American shale means that companies exposed to the offshore sector continued to struggle. National Oilwell Varco and Saipem, two companies with larger offshore segments, both reduced their workforce by more than 10%. For 2016–2017, the contraction in employment slowed for the offshore-focused UK oil and gas industry; 2016–2017 saw a 4.2% reduction in total employment, compared with reductions of 15.6% for 2015–2016 and 19.4% for 2014–2015.

However, since the end of 2017, hiring has also been picking up within the offshore sector as rising oil prices encourage more offshore projects to be approved. Rystad Energy said it expects almost 100 projects worth about $95 billion to be sanctioned in 2018 (Fig. 3). This compares with only 45 projects in 2016. With an additional 100 projects expected to be sanctioned in 2019, with higher average costs per project, the required activity levels for these would be 80% of the peak in 2013. This level is found by adjusting for the unit price reductions that have occurred in the offshore space during the downturn and comparing it with the $219 billion that was sanctioned in 2013.

Together with expected continuous growth in the shale market, the overall service sector labor market is expected to grow to the levels seen in 2010. The 20% growth expected toward 2020 could lead to increased recruitment, good news for those looking to get back in to the industry.

Old CaTS Technology Learns a New Trick

Trent Jacobs, JPT Digital Editor | 

Somewhere offshore Norway there is an abandoned appraisal well that is unlike any other. Despite being a non-producer, inside it are pressure gauges meant to reveal clues on how the reservoir will ultimately give up its resources.

Developed by service firm Expro, the technology being discussed here is the cableless telemetry system (CaTS). Instead of running the requisite productivity test and then leaving an appraisal well behind for months or years until a field is ready for development, operators use the CaTS for the long-term collection of transient pressure data that will help them narrow the uncertainties of where to drill next.

It works by sending data from battery-powered pressure and temperature gauges though a well’s metal casing via an electro-magnetic (EM) transmitter, a critical ingredient to Expro’s approach.

“There are many different telemetry systems and technologies, [e.g.] acoustic, mud pulse,” explained Stephen Kelly, a product line manager for Expro’s wireless well solutions group. “But the thing about the EM system is that the signal is unaffected by any barriers in its path. So bridge plugs have no impact, and cement plugs, zero impact.”

Open Hole Hop

As is the norm for an appraisal well, this one was used to run tests that help determine key things such as permeability before being plugged up.

But less normal is the fact that the operation involved installing a sensor within the pilot-hole section of the well before cutting its casing and installing a rock-to-rock cement plug. The upper casing was then also cut some 15 feet below the mudline, per Norwegian regulations that aim to eliminate the risk of a fishing vessel’s trawling net getting snagged onto the wellhead.

Model Capabilities

What kept the engineers unsure of their technology’s capabilities was the model that Kelly described as the “brains of the operation” which is used to predict how the CaTS and all its bespoke components may work in each well scenario.

This model balances out three defining parameters for each job: rate, range, and duration. In other words, the CaTS engineers need to know how many data points does the operator need over a given period, how far can that data be transmitted, and how long does the monitoring system need to stay powered up. Depending on the answer to these questions, a CaTS can be designed to last for 3-7 years before its batteries die, at which point the units can be left in place or retrieved for a battery swap.

But to understand the uncased scenario, the team turned to a different 3D model which suggested that data could be transmitted this way if repeater units were placed close to where the casing was cut.

When the rig pulled off location, success was confirmed when a support vessel was still receiving pressure data from the CaTS. This seemingly small development for a well-proven technology confirmed that the CaTS can work in a wider envelope of abandoned or suspended well designs than was once believed.

Expro is anticipating that this latest example of its telemetry skills will lead to more instrumentation work in wells with casing breaks or longer open-hole sections. The company also has plans to create a new generation of the CaTS, a project that will consider whether to upgrade its pressure rating from 15,000 PSI to 20,000 PSI in order to add to its potential application ultra-high-pressure basins such as the Gulf of Mexico.