NPF conference September 17-18, 2008 Intelligent Fields and Integrated Operation

1. NPF conference September 17-18, 2008 Intelligent Fields and Integrated Operation Integrated Operations beyond 2020 Jon Kleppe and Jon Lippe Center for Integrated Operations in the Petroleum Industry

2. RESEARCH PARTNERS INDUSTRIAL PARTNERS COLLABORATING INTERNATIONAL ACADEMIC PARTNERS Many ideas in this presentation are based on contributions from our partners:

3. What happened the last 15 years? • with relevance to Integrated Operations • Technology (ICT) • The internet and www • email for all • PC revolution • PDA and Cell phones • ISDN, ADSL, WLAN • Microsoft, Linux • High performance computing and visualization • IO specific: Fiber optics on the NCS, operation centers • People and Organizations • Business Process Reengineering (BPR) • Knowledge management • Core competence strategy thinking (Gary Hamel) • Flat organizations • Multidiscipline teams • IO integrated teams in reservoir, production, drilling • Processes • Global outsourcing and production • E-Commerce • Value chain management, Integration of business processes of • customers and suppliers

4. What will happen with the workforce the next 15 years? ROLE IN BUSINESS Radio Lux generation (age 55-70) Veterans, Advisors Hierarchy Color TV generation (age 40-55) Seniors, Top managers Predictability Cell Phone/email generation (age 25-40) Challenges, Entrepreneurs Flexibility, mobility Gaming generation (age 10-25) Recruitment base Virtual Life

5. ROLE IN BUSINESS Color TV generation (age 55-70) Veterans, Advisors Predictability Cell Phone/email generation (age 40-55) Seniors, Top managers Flexibility, mobility Gaming generation (age 25-40) Challenges, Entrepreneurs Virtual Life ? Recruitment base

6. Virtual teams in a “Flat world” "In the future you can collaborate with anyone, anywhere, at anytime, and at almost any level of interaction" David Coleman, Founder and Managing Director of Collaborative Strategies, (www.collaborate.com)

7. Collaboration Collaboration Cave technology 1990 –collaboration Virtual collaboration 2020 Virtual collaboration 2020 Multiple display faces Collaboration technology 2008 Interactive technology 2020 • Collaboration technology • Like Jack Bauer in “24” • Mobile computing and wireless networks will be many times faster than today’s work stations • Extended collaborative services available (visualization, VR, data sharing, communication, virtual meetings) • Seamless and safe data management/exchange through the web, communication standards • “Intelligent” data retrieval, search engines based on semantic web

8. 2008: A NEED FOR INTEGRATION OF INFORMATION Most information systems today are still designed by specialists, for specialists

9. Models in different domains will communicate Interconnection between models

10. Attitudes Collaboration skills Knowledge about other disciplines Specialized knowledge The new petroleum engineer: T-competence New specialist: Team coordinator “Specialist General practioner” Specialists are still needed, but their competence is extended

11. The role of the universities in education of “IO ready” petroleum engineers

12. The Future Workspace Perspectives on Mobile and Collaborative Working MOSAIC project, final report (http://www.ami-communities.eu) “Ad-hoc networks of mobile professionals supported by ubiquitous* collaboration services” Ubiquitous* (Wikipedia): Seeming to appear everywhere at the same time

13. Ormen Lange Operation room Draugen Operation room Nyhamna office Kristiansund office (Råket) Contractors Norske Shell Stavanger office Expert groups Shell Global Shell Draugen and Ormen Lange operationsActors in Production Optimization Source: Camilla Tveiten, NTNU/SINTEF, Courtesy Shell

14. Communication patternShell Draugen and Ormen Lange operationsActors in Production Optimizing Source: Camilla Tveiten, NTNU/SINTEF, Courtesy Shell

15. Consequences for organization and management • Complexity of networks between integrated teams makes traditional hierarchical structures less efficient • Teams will connect “like neurons”, depending on what gives added value. • The networking process is hard to manage directly. • Management is redefined: • What will be words like “control”, “responsibility”, “reporting to…” mean in the new IO environment? • Top level management  building culture • Development of culture, values, goals, KPI’s • Long term strategies and decisions • Middle management Team facilitators/coordinators, network coordinators • Conversion from middle management to team facilitation and coordination • Will it be the same people? Retraining? • Team responsibility • Smart decisions. Quality assurance will have to take place inside the team • - Connect to other teams and specialists, collect information and expert support

16. Integrated operation will expand to the whole value chain from exploration to marketing …giving added value, but also increasing the complexity of communication

17. Technology: Remote operation

18. Sensor and data transmission technologyNano technology/wireless sensors and new signal transmissionsNew opportunities for information from reservoir, downhole, subsea and top site

19. Drilling information

20. Amount of available data  Time The amount of data will increase drastically  need for automatic data processing Workload oil company Total amount of data to be analyzed Workload service/system supplier Amount of data to be analyzed by supplier Courtesy to Trond Lilleng, StatoilHydro

21. CONSEQUENCES • Suppliers will receive a larger and larger portion of data analysis tasks • Suppliers will have deep competence of models and tools, and need to be integrated in the optimization teams

22. Team performance Time MODEL BASED DECISIONS Team integration, communication Model based decision making Total team performance

23. Shift from reality to “virtuality” Practical experience Holistic view Model based thinking Analytical approach Models are simplifications of reality Are we aware of their limitations? Practical experience is hard to represent in mathematical models Will it still be ”valid”?