1 Production SIG and PRODML™ Work Group Meetings Alan Doniger Chief Technology Officer POSC Aberdeen, Scotland 20 September 2006

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Production SIG and Production SIG and PRODML™ Work Group PRODML™ Work Group

MeetingsMeetings

Alan DonigerAlan Doniger

Chief Technology OfficerChief Technology Officer

POSCPOSC

Aberdeen, Scotland20 September 2006

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Today’s Meeting HostToday’s Meeting Host

BP: Rusty Foreman, BP: Rusty Foreman, Julian Pickering, Julian Pickering, Sophie RickmanSophie Rickman

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Board

Economics

ReservoirEngineering

ExplGeology

Petrophysics PetroleumEngineering

Drilling

Engineering

ProductionGeology

Production

Engineering

Facilities

Engineering

ProductionOperationsGeophysics

DrillingOperations

Completion &Workover

In an overall E&P context …In an overall E&P context …

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Production SIG, October 20 AgendaProduction SIG, October 20 Agenda

08:00 Registration and Breakfast08:00 Registration and Breakfast08:30 Meeting Begins08:30 Meeting Begins

Welcome and IntroductionsWelcome and IntroductionsProduction SIG OverviewProduction SIG OverviewNorway’s Integrated Information Platform Project (IIP)Norway’s Integrated Information Platform Project (IIP)WITSML Production Reporting Standards and the Norway WITSML Production Reporting Standards and the Norway

OLF Daily Partner Production Reporting DeploymentOLF Daily Partner Production Reporting DeploymentQuestions & AnswersQuestions & Answers

10:00 Morning Break10:00 Morning Break

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10:30 Meeting Continues10:30 Meeting ContinuesUpdate on PRODML Work Group (Optimization Update on PRODML Work Group (Optimization

Standards)Standards) History and StatusHistory and Status Business CaseBusiness Case Pilot Activities and DemosPilot Activities and Demos

Questions & AnswersQuestions & Answers

12:00 Lunch12:00 Lunch

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Production SIG, October 20 AgendaProduction SIG, October 20 Agenda 13:00 Meeting Continues13:00 Meeting Continues

Update on PRODML Work Group (continues)Update on PRODML Work Group (continues) Public Review ResultsPublic Review Results Plan to Publish Version 1.0Plan to Publish Version 1.0 Transition to POSC and the Production SIGTransition to POSC and the Production SIG

Production SIG ActivitiesProduction SIG Activities 14:30 Adjourn SIG Meeting14:30 Adjourn SIG Meeting

14:30 – 15:00 14:30 – 15:00 PRODML Work Group Steering Committee Meeting (for PRODML Work PRODML Work Group Steering Committee Meeting (for PRODML Work Group members only)Group members only)

15:00 – 15:30 15:00 – 15:30 Production SIG Steering Committee MeetingProduction SIG Steering Committee Meeting(for current and prospective SIG members)(for current and prospective SIG members)

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Coming Attractions…Coming Attractions…

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Houston SIG Meeting Houston SIG Meeting November 7, MorningNovember 7, Morning

This meeting will address these subjects: This meeting will address these subjects: Orientation - Organizing a North America Region:Orientation - Organizing a North America Region:

Purpose, Administration, and Plans Purpose, Administration, and Plans Data Management SIG: Data Management SIG:

Update on Global Unique Well Identifier Initiative Update on Global Unique Well Identifier Initiative A New SIG Being Formed:A New SIG Being Formed:

Products, Services and Equipment Classification Products, Services and Equipment Classification

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Join your E&P colleagues to hear the latest in thought leadership for upstream oil and gas standards. Catch up with exciting changes taking place at POSC: new leadership, new mission and enhanced membership value.

This exciting event will introduce our Energy Standards Resource Centre, new collaborative services on offer and the development of a global open standards user community.

A special hosted reception will follow immediately after the Standards Summit from 5:00 – 8:00 PM, so Register Now!

•Meet the new leadership •Connect with E&P colleagues •Catch up on new offerings

DATE/TIME:November 8, 20063:00-5:00PM Summit5:00-8:00PM Reception

PLACE:Marriott West Loop1750 West Loop SouthHouston, Texas 77027

Hotel Information:marriottwestloop.com

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What’s in a name?What’s in a name? xField SIG (2003)

xField = { SmartField, i-field, e-field, Digital Oilfield of the Future, Intelligent Field, Field of the Future … }

Integrated Operations SIG (2004) Production SIG (2006)

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Production SIG OverviewProduction SIG Overview January 2003, BostonJanuary 2003, Boston

POSC Board recommends strategic focus on production standards POSC Board recommends strategic focus on production standards to support future digital oilfield operations.to support future digital oilfield operations.

May 2003, Houston and London May 2003, Houston and London ““xField SIG” seminarsxField SIG” seminars Presenters: Presenters: BP, Shell, Halliburton, Invensys, OSIsoft, BP, Shell, Halliburton, Invensys, OSIsoft,

SchlumbergerSchlumberger, SGI, SGI November 2003, Houston, POSC Annual MeetingNovember 2003, Houston, POSC Annual Meeting January 2004, HoustonJanuary 2004, Houston

Joint seminar with U. of HoustonJoint seminar with U. of Houston March 2004, LondonMarch 2004, London

Distributed Temperature Survey work group meetingDistributed Temperature Survey work group meeting

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Production SIG OverviewProduction SIG Overview May 2004, HoustonMay 2004, Houston

OTC Digital Energy Session: Peter Goode (Schlumberger SIS OTC Digital Energy Session: Peter Goode (Schlumberger SIS President), “The key technical components for Version 1 of the President), “The key technical components for Version 1 of the Digital Oilfield are already available.”Digital Oilfield are already available.”

Joint seminar with U. of Houston – attempt to initiate collaborative Joint seminar with U. of Houston – attempt to initiate collaborative activitiesactivities

BP, ExxonMobil, ShellBP, ExxonMobil, Shell, Unocal, Aspentech, , Unocal, Aspentech, Halliburton, Invensys, Halliburton, Invensys, SchlumbergerSchlumberger, SGI, SGI

Integrated versus isolated solutions?Integrated versus isolated solutions? Monitoring, optimization and control?Monitoring, optimization and control?

Multi-scaleMulti-scale Data driven model developmentData driven model development Abnormal situation detectionAbnormal situation detection RT decision-making using large data setsRT decision-making using large data sets Surface facility – reservoir interactionSurface facility – reservoir interaction Data volume explosion Data volume explosion how to handle and find useful data how to handle and find useful data Safety concerns in highly instrumented fieldsSafety concerns in highly instrumented fields

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Production SIG OverviewProduction SIG Overview

June 2004, Stavanger and HoustonJune 2004, Stavanger and Houston ““xField” xField” “Integrated Operations” SIG meeting“Integrated Operations” SIG meetingBP, Chevron, ExxonMobil, Shell, HalliburtonBP, Chevron, ExxonMobil, Shell, Halliburton, ,

Paradigm, Paradigm, SchlumbergerSchlumbergerIntelligent Oilfield Ops – review U. of Houston seminar Intelligent Oilfield Ops – review U. of Houston seminar DTSDTS

November 2004, Houston “Int Ops SIG” November 2004, Houston “Int Ops SIG” DTSDTSDigital Oilfield (Andy Howell, Schlumberger)Digital Oilfield (Andy Howell, Schlumberger)Norway IIP Project UpdateNorway IIP Project Update

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Production SIG OverviewProduction SIG Overview January 2005, New Delhi, “Int Ops” SIGJanuary 2005, New Delhi, “Int Ops” SIG

Integrated OperationsIntegrated Operations DTSDTS

April 2005, Aberdeen and Stavanger,April 2005, Aberdeen and Stavanger,“Int Ops” SIG“Int Ops” SIG DTSDTS Norway Daily Partner Production Reporting (TietoEnator)Norway Daily Partner Production Reporting (TietoEnator)

WITSML for Production ReportingWITSML for Production Reporting RT Operations (Sense Intellifield)RT Operations (Sense Intellifield) Norway IIP Project UpdateNorway IIP Project Update

April 2005, StavangerApril 2005, Stavanger Norway OLF Integration Operations SeminarNorway OLF Integration Operations Seminar

May 2005, Houston, “Int Ops” SIG May 2005, Houston, “Int Ops” SIG Same as AprilSame as April Statoil and Hydro on Integration Operations Strategy and VisionStatoil and Hydro on Integration Operations Strategy and Vision Also, Merrick Systems, Sense Intellifield, Roxar, WeatherfordAlso, Merrick Systems, Sense Intellifield, Roxar, Weatherford

May 2005, London, DTS Work Group MeetingMay 2005, London, DTS Work Group Meeting

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Production SIG OverviewProduction SIG Overview August 2005, Houston, PRODML Initiative Kick-Off August 2005, Houston, PRODML Initiative Kick-Off

MeetingMeeting November 2005, POSC Annual MeetingNovember 2005, POSC Annual Meeting

Updates on WITSML Production Reporting and Norway IIP Updates on WITSML Production Reporting and Norway IIP ProjectProject

December 2005, PRODML Work Group formally December 2005, PRODML Work Group formally establishedestablished

December 2005, WITSML V1.3.1 PublishedDecember 2005, WITSML V1.3.1 Published With WITSML Production DTSWith WITSML Production DTS

March 2006, Houston, Production SIGMarch 2006, Houston, Production SIG WITSML Production ReportingWITSML Production Reporting WITSML Production DTSWITSML Production DTS WITSML Production Fluid PropertiesWITSML Production Fluid Properties PRODML Work Group UpdatePRODML Work Group Update

April 2006, WITSML Production Reporting April 2006, WITSML Production Reporting (V1.3.1 Addendum) Published(V1.3.1 Addendum) Published

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Production SIG OverviewProduction SIG Overview May 2006, Houston, Production SIGMay 2006, Houston, Production SIG

Norway IIP Project UpdateNorway IIP Project Update WITSML Production Reporting / Norway Partner WITSML Production Reporting / Norway Partner

ReportingReporting WITSML Production Fluid PropertiesWITSML Production Fluid Properties PRODML Work Group UpdatePRODML Work Group Update WITSML Production DTSWITSML Production DTS

June 2006, Stavanger and AberdeenJune 2006, Stavanger and Aberdeen Same as MaySame as May

September 14 & 28, October 3, 2006, September 14 & 28, October 3, 2006, Production SIG Steering Committee Production SIG Steering Committee Conference CallsConference Calls

October 20, 2006 Today’s eventOctober 20, 2006 Today’s event

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What Was Being SaidWhat Was Being SaidBack in mid-2004?Back in mid-2004?

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Some related activitiesSome related activities

CERA DOFFCERA DOFFSPE Real Time Operations TIGSPE Real Time Operations TIGSPE Digital Energy Study GroupSPE Digital Energy Study Group

API/GCIMT eFields ProjectAPI/GCIMT eFields ProjectReal Time Reservoir Management [TTG Group-OG21]Real Time Reservoir Management [TTG Group-OG21]

WITSML Drilling SIGWITSML Drilling SIGStrategic Decision SciencesStrategic Decision Sciences

UH CIOOUH CIOO……

Many internal / joint projects in oil / service companiesMany internal / joint projects in oil / service companies……

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The Smart FieldThe Smart FieldReal-Time OperationsReal-Time Operations

Capture

Process

Store

Analyze

Simulate

Capture

Capture

Visualization

Web

Facilities

Wells

Reservoir

Real-TimeAutomated Analysis

Real-TimeUnderstanding

Real-Time Operations

Source: Landmark

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Smart SystemsSmart SystemsFrom self-guiding missiles to self-replenishing fridges, the basic From self-guiding missiles to self-replenishing fridges, the basic

approach of all “smart technology” is measure-model-controlapproach of all “smart technology” is measure-model-control

– measure system properties– model actual vs. desired behaviour– derive required correction parameters (adaptive control)– implement control

∆xField

Acquire

Model

Analyze

Control

Source: Shell

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Business Headquarters

Capacity Planning Design [months/years]

Operational Planning [months/years]

Scheduling [days/months]

Supervisory Control [minutes/hours]

Regulatory Control [sec/minutes]

Well & Surface facilities

-Flow, pressure and temperature in wells and separator-Fuel injection to produce heat out of a boiler

-SCADA systems for coordinating flow stations and pipelines-Gas distribution/optimization on a pipeline network-Monitoring wellheads, multiples and flow stations

-Scheduling of injection/production plan and resources-Opening and closing wells or partial completions-Adjusting well operating parameters

-Planning of injection/production plan and resources-Planning drilling and workover resources-Supply Chain Management & Market and customer demands

-Asset life cycle and installed based maintenance or growth-Supply Chain Management & Market and customer demands

Aut

omat

ion

leve

l

Tim

e-scale

Fast cycle

Slower cycle

Source: Saputelli SPE 83978

Time Scales (106 range)

xField

Acquire

Model

Analyze

Control

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CERA DOFF: Stated Industry benefits

Enhanced recovery: 125 billion BOELower operating costs: $4-8 billion/year/company

Increased production rates: increase utilization 2-6%Lower facilities cost: 5-10% (3-5 years)

Decreased drilling costs: 5-15%But

Benefits are not independent, and they requireIntegration of higher quality data

Significant change in organizations and work processes

Source: CERA DOFF executive summary

Total asset awarenessActing on awareness

Increased use of full asset awareness

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Comments from OperatorsComments from Operators

Better decisions fasterBetter decisions faster

$250 million USD / year cost savings$250 million USD / year cost savings

It’s not about the technologyIt’s not about the technology

Integrate facilities, wells, subsurfaceIntegrate facilities, wells, subsurface

Find right level of ‘smartness’ for each assetFind right level of ‘smartness’ for each asset

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POSC xField: suggested work

XML standards for collaborationextending footprint of WITSML to include all data types required for

Production System Surveillance and Reservoir SurveillanceSmart Sensors

what is needed for plug-and-play at each level of OSI modelAPI’s for downhole intelligent devices, protocols (SOAP?), metadata

and metadata managementMarket Studies

smart surveillancefor “shared services” in data acquisition and management,

value-added services (pre-processing, analysis, interpretation) publishing,…

potential business models, and implementation technologies: web services.

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POSC xField Approaches

Understanding / problem identification

- pursue problems with clear (shared) business purposes

Adopt / adapt WITSML

-new Data Types to focus on Production Operations-production volumes, production tests, temperature, pressures

Focus = Architectures + Data

Develop standards via Pilot Projects

Players = oil + service + regulators

Incremental, rapid results

Catalogues of related work / relevant standards

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An oil company perspective on StandardsAn oil company perspective on Standards

Standards save money!Standards save money!uniform hardware, applications, data save $100 uniform hardware, applications, data save $100

Million/yearMillion/year

Standards lead to better science, which increases Standards lead to better science, which increases valuevalue

Use standards to address interface issuesUse standards to address interface issues

It’s better to get common than to be bestIt’s better to get common than to be best

Industry standards provide cost effective bridge to Industry standards provide cost effective bridge to the digital oil fieldthe digital oil field

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10:30 Meeting Continues10:30 Meeting ContinuesUpdate on PRODML Work Group (Optimization Update on PRODML Work Group (Optimization

Standards)Standards) History and StatusHistory and Status Business CaseBusiness Case Pilot Activities and DemosPilot Activities and Demos

Questions & AnswersQuestions & Answers

12:00 Lunch12:00 Lunch

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Production SIG, October 20 AgendaProduction SIG, October 20 Agenda 13:00 Meeting Continues13:00 Meeting Continues

Update on PRODML Work Group (continues)Update on PRODML Work Group (continues) Public Review ResultsPublic Review Results Plan to Publish Version 1.0Plan to Publish Version 1.0 Transition to POSC and the Production SIGTransition to POSC and the Production SIG

Production SIG ActivitiesProduction SIG Activities 14:30 Adjourn SIG Meeting14:30 Adjourn SIG Meeting

14:30 – 15:00 14:30 – 15:00 PRODML Work Group Steering Committee Meeting (for PRODML Work PRODML Work Group Steering Committee Meeting (for PRODML Work Group members only)Group members only)

15:00 – 15:30 15:00 – 15:30 Production SIG Steering Committee MeetingProduction SIG Steering Committee Meeting(for current and prospective SIG members)(for current and prospective SIG members)

Documents

1 Production SIG and PRODML™ Work Group Meetings Alan Doniger Chief Technology Officer POSC Aberdeen, Scotland 20 September 2006