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The Operational and
Economic Benefits of Remote
  Production Monitoring

      Mid Continent Digital
       Oilfield Conference
        August 15, 2012
        Tulsa, Oklahoma


             Jim Taylor
           Wellkeeper, Inc.
Production Data Gathering
Spectrum: Hand Readings
                      Pumper Hand Entry     Field Data Capture   Remote Monitoring   SCADA
                                                  Device
Data Frequency            1 per day

Incremental Benefit       Status Quo

Communication             Call in/fax

Cost                  Base personnel cost
Production Data Gathering
Spectrum: Field Data Capture
                      Pumper Hand Entry     Field Data Capture     Remote Monitoring   SCADA
                                                  Device
Data Frequency             1 per day              1 per day

Incremental Benefit       Status Quo        •Reduce
                                            transcription errors
                                            •Integration with
                                            other systems
Communication             Call in/fax             Upload

Cost                  Base personnel cost    ~$10-15 per month
Production Data Gathering
Spectrum: Remote Monitoring
                      Pumper Hand Entry     Field Data Capture      Remote Monitoring       SCADA
                                                  Device
Data Frequency             1 per day              1 per day          24 to ~300 per day

Incremental Benefit       Status Quo        •Reduce transcription   •Reduce transcription
                                            errors                  errors
                                            •Integration with       •Integration with
                                            other systems           other systems
                                                                    •Alarms/Alerts
                                                                    •Internet access
                                                                    •History/Trends
                                                                    •Some remote
                                                                    control
                                                                    •Field productivity

Communication             Call in/fax              Upload                  Digital
                                                                     cell/satellite/radio
Cost                  Base personnel cost    ~$10-15 per month            Sensor
                                                                      install+approx
                                                                    $100/month (comm
                                                                        & software)
Production Data Gathering
Spectrum: SCADA
                      Pumper Hand Entry     Field Data Capture      Remote Monitoring              SCADA
                                                  Device
Data Frequency             1 per day              1 per day          12 to ~300 per day        Near continuous

Incremental Benefit       Status Quo        •Reduce transcription   •Reduce transcription    •Reduce transcription
                                            errors                  errors                   errors
                                            •Integration with       •Integration with        •Integration with
                                            other systems           other systems            other systems
                                                                    •Alarms/Alerts           •Alarms/Alerts
                                                                    •Internet access         •Internet access
                                                                    •History/Trends          •History/Trends
                                                                    •Some remote control     •Full remote control
                                                                    •Field productivity      •Field staff
                                                                                             reduction

Communication             Call in/fax              Upload                   Digital            Dedicated radio
                                                                      cell/satellite/radio
Cost                  Base personnel cost    ~$10-15 per month      Sensor install+approx     Long range radio
                                                                    $100/month (comm &        systems, high end
                                                                         software)                 software
Remote Monitoring vs.
SCADA


       X
      SCADA
   “We Report, You Decide”
Benefits of Remote Monitoring
Reduce downtime duration; increase
 production
Reduce spill frequency and liability
 through monitoring and alarms
Reduce safety liability (H2S exposure,
 tank climbing)
Optimize field operations
What can you see?
Process Variables                  Production Equipment
  Tank Levels                        Pump Off Controllers
  Pressures                          ESPs
     Tubing, Casing, etc.            EFMs
  Flow Rates                         Plunger Lift
     Gas, Oil, Water
                                     Pumps
  Temperatures                       LACT Units
     Heater Treater, Amine, etc.
                                     Compressors
  H2S Concentration


  “If it can be measured, it can be monitored”
Remote Monitoring Components

            Tank Battery
                           Cell
                           Sat
                           Radio                  Web Interface
Wellheads



                                   Database and
            HUB™RTU
                                   Software



                                                     File Transfer


            Sensors
Sensors and Local
Communication
Sensors
  Industry sensors or proprietary?
  Modbus Devices
Local Communication
  Short range radio or hard wired?
RTU, Long Range
Communication, Database
HUB™ RTU
   Gather and package data
    for transmission to
    database
Communication
   Digital Cellular
   Satellite/Hybrids
   Radio
   Wireless Broadband
Database
   Co-lo Facility
   Cloud
Presentation/Access/HMI
Browser based vs.
  client/server
User Rights
Tables, graphs, history,
  alarms
Reports and export
Pumpers/Field Personnel
“Forewarned is Forearmed”
Plan day and route based on
  data
Pump by exception
Alarms/Callouts
Contract Pumpers
Reduce mileage
Reduce safety exposure
Engineers
Easy access to trends
Identify growing problems
   e.g. paraffin
Monitor production
 equipment
   e.g. rod pumps, ESP’s,
     compressors
Management/Marketing/Admin
Overview of production
  vs. expectations
EFM and LACT data for
  marketing,
  transportation and
  allocation
Direct data entry into
  corporate systems
Economics of Remote
Monitoring
                        Isolated or
                          Remote
                         Location




    High fluid                                  Important:
    to tankage                                     High
       ratio            Ideal                    Producer

                         RM
                         Site

           History of                 High Exposure:
                                          H2S or
           problems                   Environmental
Quantify the Benefits
Benefits are probabilistic
  (If you knew which one site would go down,
    you’d just monitor that one!)
Apply across enough sites to get the broader
 benefits
Company-wide deployment
Use your actual downtime and spill history to
 estimate improvements
Production Increase
Distribution Example
                            Average=1.9%




0.0%   0.5%   1.0%   1.5%   2.0%   2.5%     3.0%   3.5%   4.0%   4.5%   More
                             Percentage Increase
Economic Evaluation

                                        WELLKEEPER ECONOMIC ANALYSIS
Customer                                       XYZ Oil and Gas
Case:                                          Single Battery; 50 BPD Oil, 10 MCFD Gas, 200 BPD Water
Date:                                          8/1/2012
Input Summary:                                                              Economic Indicators
Leases, wells, monitoring points (#)                  1                     NPV @           10%              $46,055
Exisiting Production                                                        IRR=                                 76%
   Oil (BPD)                                         50                     Straight Payout Period (years)       1.3
   Gas (MCFD)                                        10
   Water (BPD)                                     200
Assumed Increased Production                       1.0%                     First Year Wellkeeper Annual Benefits
Number of Pumpers                                    0.1                    Increased Production             $12,136   75%
Reduction in # of Spills per 10 years                 2                     Decreased Spill Costs             $3,030   19%
                                                                            Pumper Optimization               $1,028    6%
Economic Sensitivity
Example

             IRR versus Tank Battery Production (BOPD)
      80%
      70%
      60%
      50%
IRR




      40%
      30%
      20%
      10%
       0%
                  10            20            30             40            50
                                            BOPD

      Base: 50 BOPD, 10 MCFD, 200 BWPD, $70/bbl, $2.50/MMBTU, 1% downtime reduction
One Final Analogy…




     “Why settle for only daily data?”
Thank You!

              Jim Taylor
           Wellkeeper, Inc.
     jim.taylor@wellkeeper.com
        www.wellkeeper.com
            888-935-5533

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Benefits Of Remote Monitoring Mid Con Digital Oilfield Conf August 15 2012

  • 1. The Operational and Economic Benefits of Remote Production Monitoring Mid Continent Digital Oilfield Conference August 15, 2012 Tulsa, Oklahoma Jim Taylor Wellkeeper, Inc.
  • 2. Production Data Gathering Spectrum: Hand Readings Pumper Hand Entry Field Data Capture Remote Monitoring SCADA Device Data Frequency 1 per day Incremental Benefit Status Quo Communication Call in/fax Cost Base personnel cost
  • 3. Production Data Gathering Spectrum: Field Data Capture Pumper Hand Entry Field Data Capture Remote Monitoring SCADA Device Data Frequency 1 per day 1 per day Incremental Benefit Status Quo •Reduce transcription errors •Integration with other systems Communication Call in/fax Upload Cost Base personnel cost ~$10-15 per month
  • 4. Production Data Gathering Spectrum: Remote Monitoring Pumper Hand Entry Field Data Capture Remote Monitoring SCADA Device Data Frequency 1 per day 1 per day 24 to ~300 per day Incremental Benefit Status Quo •Reduce transcription •Reduce transcription errors errors •Integration with •Integration with other systems other systems •Alarms/Alerts •Internet access •History/Trends •Some remote control •Field productivity Communication Call in/fax Upload Digital cell/satellite/radio Cost Base personnel cost ~$10-15 per month Sensor install+approx $100/month (comm & software)
  • 5. Production Data Gathering Spectrum: SCADA Pumper Hand Entry Field Data Capture Remote Monitoring SCADA Device Data Frequency 1 per day 1 per day 12 to ~300 per day Near continuous Incremental Benefit Status Quo •Reduce transcription •Reduce transcription •Reduce transcription errors errors errors •Integration with •Integration with •Integration with other systems other systems other systems •Alarms/Alerts •Alarms/Alerts •Internet access •Internet access •History/Trends •History/Trends •Some remote control •Full remote control •Field productivity •Field staff reduction Communication Call in/fax Upload Digital Dedicated radio cell/satellite/radio Cost Base personnel cost ~$10-15 per month Sensor install+approx Long range radio $100/month (comm & systems, high end software) software
  • 6. Remote Monitoring vs. SCADA X SCADA “We Report, You Decide”
  • 7. Benefits of Remote Monitoring Reduce downtime duration; increase production Reduce spill frequency and liability through monitoring and alarms Reduce safety liability (H2S exposure, tank climbing) Optimize field operations
  • 8. What can you see? Process Variables Production Equipment Tank Levels Pump Off Controllers Pressures ESPs Tubing, Casing, etc. EFMs Flow Rates Plunger Lift Gas, Oil, Water Pumps Temperatures LACT Units Heater Treater, Amine, etc. Compressors H2S Concentration “If it can be measured, it can be monitored”
  • 9. Remote Monitoring Components Tank Battery Cell Sat Radio Web Interface Wellheads Database and HUB™RTU Software File Transfer Sensors
  • 10. Sensors and Local Communication Sensors Industry sensors or proprietary? Modbus Devices Local Communication Short range radio or hard wired?
  • 11. RTU, Long Range Communication, Database HUB™ RTU Gather and package data for transmission to database Communication Digital Cellular Satellite/Hybrids Radio Wireless Broadband Database Co-lo Facility Cloud
  • 12. Presentation/Access/HMI Browser based vs. client/server User Rights Tables, graphs, history, alarms Reports and export
  • 13. Pumpers/Field Personnel “Forewarned is Forearmed” Plan day and route based on data Pump by exception Alarms/Callouts Contract Pumpers Reduce mileage Reduce safety exposure
  • 14. Engineers Easy access to trends Identify growing problems e.g. paraffin Monitor production equipment e.g. rod pumps, ESP’s, compressors
  • 15. Management/Marketing/Admin Overview of production vs. expectations EFM and LACT data for marketing, transportation and allocation Direct data entry into corporate systems
  • 16. Economics of Remote Monitoring Isolated or Remote Location High fluid Important: to tankage High ratio Ideal Producer RM Site History of High Exposure: H2S or problems Environmental
  • 17. Quantify the Benefits Benefits are probabilistic (If you knew which one site would go down, you’d just monitor that one!) Apply across enough sites to get the broader benefits Company-wide deployment Use your actual downtime and spill history to estimate improvements
  • 18. Production Increase Distribution Example Average=1.9% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% More Percentage Increase
  • 19. Economic Evaluation WELLKEEPER ECONOMIC ANALYSIS Customer XYZ Oil and Gas Case: Single Battery; 50 BPD Oil, 10 MCFD Gas, 200 BPD Water Date: 8/1/2012 Input Summary: Economic Indicators Leases, wells, monitoring points (#) 1 NPV @ 10% $46,055 Exisiting Production IRR= 76% Oil (BPD) 50 Straight Payout Period (years) 1.3 Gas (MCFD) 10 Water (BPD) 200 Assumed Increased Production 1.0% First Year Wellkeeper Annual Benefits Number of Pumpers 0.1 Increased Production $12,136 75% Reduction in # of Spills per 10 years 2 Decreased Spill Costs $3,030 19% Pumper Optimization $1,028 6%
  • 20. Economic Sensitivity Example IRR versus Tank Battery Production (BOPD) 80% 70% 60% 50% IRR 40% 30% 20% 10% 0% 10 20 30 40 50 BOPD Base: 50 BOPD, 10 MCFD, 200 BWPD, $70/bbl, $2.50/MMBTU, 1% downtime reduction
  • 21. One Final Analogy… “Why settle for only daily data?”
  • 22. Thank You! Jim Taylor Wellkeeper, Inc. jim.taylor@wellkeeper.com www.wellkeeper.com 888-935-5533

Notes de l'éditeur

  1. Good morning. I’d like to start with an overview of the remote production data gathering landscape. First, and still very popular with the small to mid sized independent, is hand gathering by pumpers on a daily basis. It is the tried and true method, with data phoned or faxed in daily after the pumper makes his rounds. The home office then enters the data into their own systems for reporting.
  2. Field data capture, through any number of handheld or portable devices, allows for daily data to be entered on the device and then transmitted. These systems reduce transcription errors and can integrate into the company’s systems directly.
  3. Remote Monitoring replaces the once a day hand entry with multiple readings taken by sensors in the field. That data can be transmitted over 300 times per day, with the frequency determined by the communication method that is used. The readings can be used to generate alarms and callouts throughout the day, they can be stored for easy access to history and trends, and can generally be accessed from the internet.The extra information helps increase field staff effectiveness and productivity.Remote monitoring systems can provide some degree of remote control, but are limited by the digital cell or satellite communication that is used.Costs increase with the need to install sensors and communication devices, and pay for the communication system that is used.
  4. Full SCADA systems require secure and near continuous communication to allow for remote control and confirmation of control changes. Most of the majors and many large independents have installed full SCADA on their production operations, allowing for restructuring of their field staff and maximizing field coverage per person.
  5. A couple of cute ways to differentiate Remote Monitoring from SCADA, is that Remote Monitoring is SCADA without the “C”.Also, I’m indebted to Fox News for their very applicable tag line:With Remote Monitoring, “We Report, You Decide”.
  6. The frequent and easily accessible readings make several benefits possible:Downtime duration can be reduced, since you know when something goes down rather than find out the next day when the pumper returnsSpill frequency can be reduced since levels are read and callouts can be triggered before the tank overflowsYou can minimize the time your field people spend on top of tanks, reducing their safety exposureWith “morning report” data available, field operations can plan their day based on priorities, rather than a set route.
  7. The process variables and production equipment that is visible in a remote monitoring system is really just limited by what you want to see, and what you think is important. As long as there is a sensor made to measure what you want, or a Modbus register available to read it, you can have 24/7 access to what your remote operations are doing.
  8. The components of a typical remote monitoring system are pretty consistent:Field sensors and local communication to get the data to an RTUAn RTU to package the readings and transmit data packets to a database for storage and retrievalAnd then a way to access the data and transfer it to other downstream systems as needed.
  9. There is no one best choice on sensors, with some companies using proprietary designs and others using industry manufactured sensors for their readings. Modern production equipment also use Modbus protocols to allow for direct access to digital data.The choice of using short range radio or hardwired connections from the sensors to the RTU is also an issue for optimum economics, depending upon the distances involved.
  10. The RTU, long range communication and database subsystems complete the delivery and storage of data for later access.Long range communication choices are a balance of cost and communication requirement, with the trend towards higher, low cost bandwidth, is enabling the gathering of ever more data at an acceptable cost.Finally the location of the database can range from a local single server to co-location facilities, and many Remote Monitoring companies are migrating to the cloud.
  11. The effective and intuitive presentation of data to the user is equally important for long term customer satisfaction. Some systems use a client/server structure while others use the local browser. There are issues of user rights administration and the ability to see information in a format that is most useful and exportable to other systems.
  12. Remote monitoring appeals to at least three groups of employees: the field, the engineers and the bosses.Giving your field organization information to start their day means that they know what they are getting into before they ever go out.A pumper may not even have to go to a particular site every day, and the system can reduce mileage and safety exposure without losing access to critical information about the operations.
  13. Engineers really value the easy access to historical trends and the ability to easily monitor production equipment. They can foresee impending problems and work to optimize and maximize production across an entire field with ease.
  14. Management and marketing functions can see the ‘big picture”, and have easy access to production and allocation data. Direct entry of data into downstream systems can reduce clerical errors and minimize administrative costs.
  15. So what would be the ideal Remote monitoring site?Out in the boonies, an important high producer, in an environmentally sensitive location, with a history of problems and a high ratio of fluid production to tankage, just waiting to spill.So why not monitor just those sites?
  16. If you think about it for a second, many of the benefits are probabilistic in nature. You don’t know when or if a single site will have a downtime event. So, like most probabilistic things, the best strategy is to build a portfolio of monitored sites. You want to have enough sites monitored so the economic benefit of the portfolio is likely to occur, even if one site never has a problem. The actual benefits are directly related to the particulars of your operation, and you can estimate the results based on your own company’s history.
  17. This chart represents the spread of production increase experienced by one of our customers, illustrating the wide range of outcomes. Anywhere from 0% to well over 5 to 10% downtime reduction is possible with a remote monitoring system.
  18. Based on an individual operator’s history and judgment, the benefits of remote monitoring can be quantified, and the investment economics can be calculated. In this particular instance, with a $100/month fee, $70/bbl oil, $2.50/MMBTU gas, and a $100/bbl spill clean up cost, this 50 BPD tank battery had a very attractive IRR and a payout in just over 1 year.Economics like these can be run for each site in the portfolio, with an output ready to attach to an AFE
  19. Since the capital investment for remote monitoring is pretty low, it can be economically attractive even to as low as 15 BOPD through a tank battery.The advantages that come with the ability to see your remote operations in near real time should really be explored to improve your production operations.
  20. I’ll close with one final analogy.When my wife and I raised our boys, we kept an eye on them when we could and everything turned out just fine. But in the years since then, the cost of baby monitors came way down. Nowadays, there is hardly a new parent couple that does not buy and use a monitor so they know right away if something is wrong.If something is important to you, like your baby or the far flung revenue stream that is your production operations, you really should keep a close eye on it!Thank you.