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Interview

Jan-Erik Nordtvedt, President & CEO, Epsis, Norway

10.06.2013 / Energyboardroom

For some executives, the vision of Integrated Operations (IO) involves NASA-style control rooms dotted around the world, remotely controlling offshore drilling operations. When you look at the reality of oil production in the world today, this appears like science fiction. How big is the market for IO today?

IO can already be seen as an industrial market as well as being one for the future. It all depends on how you look at IO. Oftentimes, we talk about IO in terms of imaginative production concepts that we would like to achieve years down the line and the reality today is very different. I recently revisited the ambitions and aspirations that the Norwegian industry laid down for IO ten years ago. In some aspects we have achieved quite a lot, but in the majority of cases we are working in practically the same way to a decade ago. On the other hand, oil companies have definitely become more efficient in their production methods. Companies now have better communication technologies from sea to land and for uploading data – the first generation of IO. It is the second stage of IO, with a clearer focus on workflow integration and implementation, as well as involving extensive cross-company collaboration, which is yet to really appear.

Frequently the industry talks of the “end state” and the pseudo NASA-style control rooms, directing offshore drilling and production. Personally, I am more concerned with how to work more effectively in today’s industry.

Implementing the transition towards IO is no easy task in Norway today. It is a catch-22 situation, where organizations are so preoccupied with their present challenges that they are not able to implement efficient methods, which could ultimately save them time. The expansion of the industry involves a lot of time getting people up to speed with existing methods and it is therefore a huge challenge to look past these methods to the future.

I think that the “end-state” is a valuable way of looking at the type of solutions that we can bring to integrated operations, but the “here and now” is much more relevant when applying this to the market. We must move incrementally in changing the industry given its current level of activity.

Other than the time constraints for implementing change, what are the other challenges facing the transition to the second generation of IO?

The operators today have been moving toward integrating service companies into their operations, as an extension of their existing network. However, they are reluctant to outsource business segments, which may jeopardize their intellectual property. Working out a way to minimize these security concerns is a major challenge for the proponents of IO. We are far behind where we should be in resolving this issue.

I believe that the present lack of movement towards these more interesting production paradigms is also a barrier to the employment of young professionals, who might themselves be the best instrument in taking IO to the next level. Fortunately the global phenomenon known as the Great Crew change, in which a significant portion of the oil and gas industry will be retiring over the next decade, should create the impetus to generate a new way of thinking about data and collaboration. This change of personnel in itself may bring huge changes to the industry.

How do you see Epsis’ role in defining integrated operations?

Epsis is a developer and supplier of Software products focused on enterprise collaboration and teamwork. We are working with companies, which are implementing IO. Within this picture, our philosophy is that content should drive collaboration, rather than collaboration driving content. We also believe in an incremental approach to developing integrated operations, focusing on generating efficiency today, rather than trying to persuade the industry to revolutionize their production paradigms.

The challenge for us is working out the right amount of change to suggest to the industry. If you bring in too large a change then companies will simply not be able to implement it; if the change is too small then it is not interesting for the industry. Finding this balance is very important, in creating change.

There have been companies, which have produced some phenomenal business cases where they have been able to completely change the mode of operation. Others have been much more timid. One of the challenges that we have experienced as an industry is that we have often been declaring success far too early. Norway is certainly not done introducing this concept. We should be more humble about what we have achieved and what is ahead of us. Norway is very good at mentioning its successes and relatively weak at discussing its failures.

There is a long way to go both within companies and between companies regarding integrated operations. For integrated operations to truly make a difference to the industry, there needs to be a much greater integration across service companies, operators and principal contractors. We are a long way off that particular end game.

You mention that Epsis takes the approach of letting content drive collaboration, what do you mean by this?

We have often been focusing on the way that technology can be used to display data, creating elaborate data portals, focusing on video-conferencing and real-time data transfers. This focus on the technology, which enables the transfer of information, is the opposite of our idea, which is to let content drive the collaboration. We want companies to identify challenges and data assets and let those assets drive the collaborative process, rather than establishing partnerships and then looking at how data can be shared. The industry needs to move towards a more flexible mode, whereby the workflows drive the collaboration.

Epsis began as a company 12 years ago and at that time we visited numerous facilities in Norway and in the rest of the world. We fond many commonalities between the companies regarding the way they were working and organizing their data across different disciplines. Although the data itself is changes and the real-time aspect can vary – there is much more information in Norway compared to the rest of the world – the way that data is gathered and shared is very similar.

We are trying to facilitate a process where all the information that you need to see is available at the click of a button. The larger companies involved in this work are working on data integration and aggregating data streams, putting everything into a portal and making a one-stop-shop for all the information. We want the integration to happen in the minds of people rather than in a central data bank and put the data in its own relevant context.

If you look at the way that people consume information today, this is already independent from the device that you consume that information on. When you make a decision you really do not care what type of device you are using, as long as you are making the right decision based on contextually accurate data.

Epsis has worked extensively with Statoil in pioneering this concept. How do you see the importance of this partnership today?

The partnership was particularly important in the early days, working on projects like Oseberg East and Brage. However, we have recently been working more closely with Chevron in IO across their international operations. We are rapidly accumulating experience in many important E&P regions. On the service sector side we have been working a lot with FMC technologies and Halliburton. We are therefore working with numerous international and American partners in developing this concept. There are many similarities between Norway and the US in the ways that companies are collaborating. There is a big difference regarding onshore data where less real-time data is available for making decisions but in terms of work processes the industry thinks very much alike.

What do you see as the future of integrated operations beyond Norway and the USA over the coming decade?

Integrated Operations have the potential to change the global market. The major oil companies in Brazil, in the Far East, West Africa and in Australia will take these concepts forward. We are trying to identify markets where these concepts can be taken forward more rapidly and markets like Australia are ideal in this regard. Some global markets may have a type of cultural resistance to the introduction of this concept, but we will focus on the early adopters.

Our ambition is to put the content front and center of our efforts to advance the integrated operations concept, rather than the technology. We are ultimately aiming to improve the decision-making process. IO is still at the early stages of its journey. We need to have aspirations beyond where IO is at the moment. There is a lot of value that this concept can bring to the global industry.

To read more articles and interviews from Norway, and to download the latest free report on the country, click here.

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