Energistics Asia South Region Meeting (Production) PRODML SIG Update

1. Energistics Asia South Region Meeting(Production) PRODML SIG Update New Delhi, India Alan Doniger 14 January 2007 Chief Technology Officer Le M▲ridien New Delhi Hotel Energistics

2. Agenda • What is PRODML? • Participants • Status • Next Steps • ’06 Pilots: Scope and Animations

3. Background • In recent years, many energy companies have begun to exploit the benefits of highly instrumented producing fields seeking optimal operation of these assets. • These efforts are known by many names, including Smart Field, Digital Field of the Future, e-Field, i-Field, etc. • A key element in these achievements is making good use of the near real-time data streaming from the field to the office or operations center. • To do this well requires the use of industry standards for data and for the communications and computing infrastructure.

4. The Role of Industry Standards • The PRODML initiative, hosted by Energistics, is being driven by energy companies and vendors who believe the industry needs a freely available, universally applicable set of industry standards. • For data definitions, formats, semantics • For communications and computing infrastructure based on state-of-the-art technologies and standards • To establish a level playing field for vendors • To enable low-risk and low-cost use of proven optimization solutions including interchangeability • To accelerate and encourage innovation in the design, configuration, and deployment of optimization solutions

5. Initial Scope Gas Treating Facilities Gas Export Facilities Gas & Oil Contract Deliverability Gathering Separation & Distribution Oil Treating Facilities Oil Export Facilities Injection (Water, Steam, CO2) Water Handling • From bottom of the well to initial separation Reservoir Management: Scope: Asset View The Production Domain • Decisions we can effect in a day

6. Scope of PRODML Application Software • Operational Modeling • Predictive algorithms to predict future measurements from historical measurements and operational plans • Allocation and Reconciliation • Derives critical values from measurements, as in back-allocation of volumes to wellbores • Surveillance and Monitoring • Continuous comparison of actual to predicted measurements; out of range condition invokes analysis • Simulation and Optimization • Predictive algorithms to predict future measurements and related set points that achieve pre-defined objectives • Advisory and Alert • Invoked when post-analytical predicted and actual performance differ significantly; alerts for remedial control changes

7. Basic PRODML Optimization Use Case Ops Modeling Appl Simul &Optimiz Appl Meas& ModelData Surv &Monitor Appl RTDataCapture Alloc& Recon Appl Advis &Alert Appl

8. PRODML’s Vision • We all talk about “Fields of the Future” • But we want them now. • The task of integrated optimization and other operational application software solutions could be horrendous • What is we had an industry standard that would interface – not necessarily integrate – software applications? • Wouldn’t that be a good thing? • Isn’t this a problem that everyone in the industry faces? • PRODML can help take us there!

9. Now Emergency Shutdown Data Fire & Gas Data Process Data Reservoir Well Surface Pipeline Device Data End elements, DTS data RTU/PLC data SCADA/DCS data What is this data? • Future • Sensor technology will enable the capture of continuous streams of data from every part of the physical environment

10. What is “Optimization?” • Optimization • A word we use often, but rarely understand • An objective often mentioned, but rarely achieved • If achieved, it is rarely sustained • One Definition • Improving the bottom-line results by timely, effective and sustained use of sufficient, good production information.

11. The Business Case • Enable continuous optimization • Artificial Lift • Estimate well/reservoir oil, gas, and water flows • Safeguard integrity • Manage abnormal situations • Get the right information to the right people, at the right time, in the right context and in the right workplace to serve the right work processes. • Examples that illustrate the business case follow.

12. Gas Lift Optimization 1.0 Oil Production . 0.5 0.0 1 7 13 19 25 Time True Production Potential Periodic Manual Optimization No Optimization Activity Real time data To and from wells Real time data To and from SCADA Optimal Set Points From model SCADA or Historian GasLift Optimization Application 2 Phase Flow Model Real time data To model

13. Gas Lift Optimization • When a well is completed, we decide how to set up gas lift parameters using multi-phase flow models. • The initial production, however, declines over time. • After a few years, the well production is analyzed and revised gas lift parameters are put in place. Production increases, but then gradually declines again. • This gives the saw-tooth pattern shown in the diagram. • If we analyze and model continuously, we can achieve production up to the blue line on the diagram. • The space between the saw-tooth and blue lines is the prize from continuous optimization. • Increased recovery, reserves, production • This is a potential benefit from PRODML.

14. Potential Optimization Business Benefits • Improved technical integrity • Improved safety • Increased production • Reduced operating expenses • A Shell engineer working on the PRODML team reported: • Production is about 4 million BBLS oil equivalent daily • Conservatively, optimization can contribute a 5% increase or 200k BBLS daily • To achieve the same increase would require 2 new platforms in the Gulf of Mexico • Cost: 3 Billion USD • Time: 5 years • People: 3,000

15. PRODML is a Key Enabler for These Benefits • PRODML helps get real-time data from the field capture systems to applications • PRODML helps move data among applications Field Data Applications • Abnormal Sit. • HC Accounting • Maintenance • Simulators • Reservoir • Well • Pipeline • Process REAL-TIME Data • ESD • F&G • Processes • Devices • Etc. Set Points andRecommendations

16. What was the PRODML Work Group? • Five oil companies proposed an initial standards development effort with established goals and constraints. • Eight vendor companies and POSC (now Energistics) were invited to join the effort. • The size was kept as small as practical. • All results will be by consensus and will be shared openly. • The duration was limited to one year – Q4 ’05 – Q4 ‘06 • Afterwards, the results went to Energistics for maintenance and further development. • State-of-the-art communications and computing technologies would be put to use. • Internet, Web Services, SOA, W3C, etc.

17. PRODML Work Group Organization

18. PRODML Teams • Steering Committee • Set direction and deliverables; oversight • All members represented • Operational Team • Day-to-day management by funding companies and team leaders • Weekly conference calls • Content Team • Business and data requirements; use cases • Technical Team • Infrastructure requirements; architecture • Communications Team • Pilot Coordination Team • Legal Framework Team

19. PRODML Work Group (’06) Members

20. PRODML Initial Scope • Work Group participants agreed to scope limitations for the initial work effort: • Start from field data already received and stored in Historians • Stop short of closed-loop control changes • Address only optimizations with recommended changes that can be implemented within one day • Reference Use Cases were chosen: • Gas Lift Well (Inlet Gas Changes) • Free Flowing Wells (Surveillance) • Field-wide (Surveillance) • Each pilot testing activity supported one of these use cases

21. Use Case: Gas Lift Well

22. Use Case: Free Flowing Well Surveillance

23. Use Case: Field-wide Surveillance

24. Data Scope • Production Systems in Producing Fields consist of • Flow Network topology (Flow Network XML Schema) • Production and injection wells, equipment, etc. • Flow connections: outlet to inlet • Measurements (Volume Reporting XML Schema) • Production volumes and flow rates • Pressures, temperatures, etc. • Test results (Well Test XML Schema) • Production well test results

25. Application Plug-and-Play • PRODML seeks to enable application software components from different vendors to interact in a consistent way. • As Service Requests • And Service Responses • One vendor’s component may be exchanged for another vendor’s component with comparable functionality • Without damaging the integrity of the optimization loop configuration • Some of the pilot testing activities explicitly demonstrated application Plug-and-Play.

26. PRODML Working Culture • Funding Companies (5) • Vendor Companies (8) • Standards Organization (Energistics) • Teams • Project Management (Full-time) • Team Interactive Web Site • Public Web Site • Shared Computing Facility (“Sandbox”) • Process • Use Case Described and Agreed • Interactions (Cartoons and Spreadsheet) • Pilot Testing Activities (Software) • Public Demonstrations / Seminars

27. Tracking PRODML Progress Months 2 4 6 8 11 14 Steering Committee Meetings • Project planning • Team Kick-Off November 15, 2006 V1.0 Release Content • Conduct workshops • Detailed Requirements • Macro Design • Workshop preparation and scheduling • Standards investigation • Develop Scope Technology • Design Communication Plan • Develop Test Bed Scenarios • Process mapping • Technology assessment • Detailed Requirements • Macro Design • Design POC • Build POC Build • Implementation guide outline • Process flow documentation • Plan Pilot Pilot Industry Review Start August 16, 2005 Strong Typing End November 15, 2006 • Project Management • Communication Requirements Build & Communicate Design-Develop-Test Implementation Phase 1 – Scope and Define

28. How has PRODML built on WITSML? • WITSML (Wellsite Information Transfer Standard – Markup Language) is an Energistics family of standards primarily intended to support the movement of drilling data from well-site to office. • Started in early 2001 • Promoted and supported by the WITSML Special Interest Group (WITSML SIG) made up of over 40 industry organizations • Similarities • Initial development organization and process • Data and infrastructure aspects re-used or adapted • Longer-term alignment remains a goal

29. PRODML’s Completion Announcement • PRESS RELEASE (September 28, 2006) coordinated with SPE Conference in San Antonio and a PRODML Hospitality Suite Session • PRODML Version 1.0, open industry standards, completed and released to improve data exchange and work process efficiency in production optimization. • Launch of Work Group in August 2005 • Viability demonstrated with four realistic pilot testing activities led by BP, Chevron, Shell and Statoil • From 1 to 1000 wells • Plug-and-Play multi-vendor applications • Meaningful workflows

30. PRODML’s Completion Announcement (2) • Standards under custody of Energistics for maintenance and further development. • XML-based data exchange solutions are available for adoption and extension • Work Group Participants • BP, Chevron, ExxonMobil, Shell, Statoil • Halliburton, Invensys, OSIsoft, Schlumberger, Sense Intellifield, TietoEnator, Weatherford • Energistics • Further information on www.prodml.org or from Energistics

31. PRODML Documents

32. PRODML Documents: Intended Uses

33. PRODML ’07 Work Group • Repeat Successful Aspects of PRODML Work Group in 2006 • Small but sufficient number of participating companies • Small but sufficiently meaningful scope of new functionality achievable within one year’s effort • Funding from participating companies to pay for full-time project management, collaborative meetings, support facilities, subject experts where needed, etc. • Comprehensive work planning based on well defined teams with strong leadership and frequent communications within and across the teams

34. What’s New for 2007? • Replace remaining hard-coded and proprietary interfaces of optimization application software with PRODML-based solutions • Example: Driving applications from a common Production Flow Network Model description. • Extend the footprint of the types of optimization that PRODML has been demonstrated to support. • Example: Demonstrate support for ESP (Electrical Submersible Pump) Artificial Life Well Optimization • Demonstrate the ability to integrate the previously published Energistics Production Reporting Standards with PRODML-based solutions. • Example: Have back-allocated wellbore volumes reported and/or recorded using PRODML defined Web Services

35. In the Marketplace • Vendors are planning to develop commercial PRODML-based versions of products during 2007. • This work will be enhanced by the additional work planned for ’07, e.g. widening the footprint, as this will strengthen the market for such products. • Without PRODML strength and growth, there are risks: • Point solutions will continue to be developed • Preventing low-cost, low-risk innovative optimization deployments, especially those that mix and match products from multiple vendors • Energy companies will develop solutions themselves • Further fragmenting the market and making conversion to standards-based solutions more difficult

36. Vision for 2007 and Beyond • For end of 2007 • Demonstrate additional PRODML-based functionality through Pilot Testing Activities. • Build on Version 1.0; try to maintain compatibility • Encourage the PRODML SIG Steering Committee to define a multi-year roadmap for PRODML Standards, that increasingly: • Helps reduce cost, time, complexity and risk for production optimization solutions using communications and computing technologies • Enables novel and valuable workflows with integration not conceived or not practical until now • Work with other solutions and standards related to production optimization, wells, reservoirs, processing plants, production accounting, etc.

37. Vision for 2007 and Beyond • Consider similar efforts in associated areas, such as • Well Management • Well Optimization • Reservoir Performance • Opportunity Portfolio Management • Facility Optimization • Etc. The PRODML approach and the PRODML architecture may fit well in some or all of these areas.

38. PRODML ’07 Work Group Scope: Flow Network Model • Requirements • Basic Flow Network Model content: Units, Ports, Connections, Locations, etc. • Enable applications to respond to configuration changes either of Units/Connections or operational parameters • Address connections with adjacent models, e.g. reservoir • Enable levels of abstractions and subsets • Enable different depths of information about Units • Enable interactions with existing / emerging standards • Proposed Pilot Testing Activities • Support multiple levels of detail and support major/minor configuration changes • Consider Web Services to supply Flow Network information to applications, including information about changes

39. PRODML ’07 Work Group Scope: Well Types • Priorities for ’07 • Fluid-Driven Artificial Lift – Surface Connections only • Consider Time Cycles for intermittent gas lift/plunger lift • Jet and Hydraulic Pump wells • Power-Assisted Artificial Lift • Consider electric motors at the surface • Consider mechanical lift • Consider variable frequency drives in electrical controllers [later] • Down-Hole Sensors • Consider wellbore configuration (WITSML Completion) • Consider multi-zone allocated volumes • Consider further aspects of well description [later] • Down-Hole Equipment [after progress on the above] • Consider down-hole gas lift for surveillance • Consider artificial lift device internals, e.g. motor / pump shaft • Consider flow controller devices

40. PRODML ’07 Work Group TimeLine & Milestones • January – June Cycle • January – Planning, sign-up, initiation of work and Pilots • February – Design, architecture confirmed, Pilot interactions, Paper prototypes • May – Pilot software work progressing, review by participating organizations, plan July-December Cycle • June – Pilot demonstrations ready, Public review period, Accept July-December Cycle plan • July – December Cycle • July – Change Requests from January-June Cycle, Planning, sign-up, initiation of work and Pilots • August – Design, architecture confirmed, Pilot interactions, Paper prototypes • October – Pilot software work progressing, review by participating organizations • November – Pilot demonstrations ready, Public review period, Plan 2008 • December – Change Requests from July-December Cycle.

41. PRODML SIG and PRODML ’07 Work Group SteeringCommittee PRODML ’07 WG Impl. Sup.Team* Spec.Team* ’07 Ops.Team • * Coverage for existing Standards:- optimization stds (PRODML V1) • reporting (WITSML Prod Rptg) • temp surveys (WISML Prod DTS) • fluid properties (WITSML Prod FP) ’07 ContentTeam ’07 Tech.Team Focus on defining, implementing,piloting, demo-ing ’07 capabilitiesin optimization Promoting and supporting useof current Standards andsupporting needs of PRODML ’07 WG

42. Continues Successful Ways of Working • IP and Non-Commercial policies • Value, short-duration, Pilot testing activities • Interaction with PRODML SIG and other Standards/SIGs • Resource commitments • Self-funded • Closed participation of small but adequate number of members • Energy, Service/Software, Technology, Standards [Energistics] • Communications out to Energistics community and the industry • Comprehensive hands-on project management • Agreed Terms of Reference; approved by SIG Steering Committee • Operational Team, Interaction Tools (Web Sites) • Meetings and Conference Calls • Effective Work Group Team structure

43. How to Participate in PRODML in ‘07 • Use PRODML Version 1.0 Standards • Develop (and sell) or license and use PRODML-based products • Join the open PRODML Special Interest Group • The Energistics open user community for all Production industry standards, including PRODML • Also, Fibre Optic Temperature Surveys, Production Reporting, and Laboratory Fluid Sample Analysis Results • Promotes and supports use of PRODML V1.0 Standards Contribute to the long-term roadmap for PRODML Standards • Contact Energistics for details • Join the PRODML ’07 Work Group • A self-funded, closed work effort to push PRODML to a new level of functionality mainly through more Oil Company led, Vendor involved Pilot Testing Activities

44. Shell Pilot Testing Activities • Free-Flowing Well Surveillance • Purpose • Notify operator whenever measured and projected production volumes differ beyond a defined threshold • Uses three sources of information • Actual and two sets of simulation results (Plug-and-Play) • Data Validator Application [Invensys: InFusion] • Triggered according to a schedule • Historian [OSIsoft: PI] • Simulation #1 [Petex: Prosper] • Simulation #2 [Weatherford: WellFlo] • Notification [Invensys]

45. 1 Get measured data every X minutes 7 AddToStore GetFromStore Response 8 5 6 3 Determine well type Simulate well performance Assess Results Assess Results 5 5 GetDataInvoke 2 4 7 Get operational conditions Notify alarm Get simulated data 2a 2a Response 2b 2b Response 4b 4b GetFromStore 4a 4a 3 3 1b 1a models models Shell Pilot Invensys Notification Invensys InFusion App Env 6 8 Weatherford WellFlo PETEX Prosper OSISoft PI Historian

46. BP Pilot Testing Activities • Gas Lift Optimization • Purpose: • Optimize Gas Lift by recommending revised lift gas rate changes • Plug-and-Play demonstrated by 2 Monitor applications • Data Consolidator #1 (Monitor) [OSIsoft: ACE] • Data Consolidator #2 (Monitor) [Intellifield: SITECOM] • Historian [OSIsoft: PI] • Optimizer [Weatherford: GL Optimizer] • Notification [Intellifield: Portal]

47. 2 5 8 6 1 9 Trigger optimiser Request gas lift rate every X minutes Send optimiser results 6b 6a AddToStore Response 8 7 2 5 Assess results Optimise Consolidate data Distribute results 9 GetFromStore GetFromStore GetDataInvoke 3 Get measured data Response Response 3a 3b 1a 1b Response 4b 4a 4 Get manual input data GetFromStore 6b 6a 7 3a 3b 1a 1b Response Response Response models GetDataInvoke 9 GetFromStore GetFromStore AddToStore 2 5 8 BP Pilot Sense Intellifield SITECOM Consolidator Weatherford GL Optimiser Sense Intellifield Portal OSISoft PI Historian OSISoft ACE Consolidator

48. Chevron Pilot Testing Activities • Field-wide Water Management • Purpose • Notify user when water tanks will reach high level, and prescribe rates for highest impact wells • 1000 wells (of 10,000 in the field) • Production Accounting [TietoEnator: EC] • Monitor Application [Invensys: InFusion] • Historian [Invensys: InSQL] • Simulator [Weatherford: LOWIS] • Forecasting [Landmark: DSS] • Data Integrator [Schlumberger] • Notification [Invensys]

49. AddToStore 25 GetDataInvoke AddToStore 16b 16a 19b 19a GetDataInvoke 15 18a 18b 25 Send instruction data GetDataInvoke 2 8 7 17 1 3 20 10 24 Determine well type Develop prioritised list Get simulated sales & status data Determine well type Simulate data sets Determine well type Determine tank type Determine well type Surveil tanks every X days GetDataInvokee 21 23 4 19 16 18 Get allocations Trigger optimisation Get well forecasts Get rig on/off dates Get operational conditions Get well statuses GetDataInvoke 6b 6a GetDataInvoke 21a 21b 4a 4b 13 5 14 12 22 11 Forecast wells Consolidate data Allocate flows Get simulated tank level data Forecast tank level Get simulated well data GetFromStore 23a 23b 9 15 6 Notify Alarm Get water allocations Get well test data 3 7 20 17 10 9a 9b models models models models models GetDataInvoke 8a 8b 11a 11b 5a 5b Chevron Pilot Schlumberger Data Integrator 24 Invensys Notification 2 Invensys InFusion Landmark DSS 22 14 Energy Components 13 Invensys InSQL Weatherford LOWIS 12 Data Set Simulator 1

50. Statoil Pilot Testing Activities • Optimize smart wells • Purpose • Optimize smart wells and report recommended operational parameters • Data Consolidator (Monitor) [Schlumberger: DECIDE] • Historian [Out of Scope] • Production Accounting and Operational Parameters [TietoEnator, PROSTY] • Optimizer [Schlumberger: IAM] • Simulator [Petex: PROSPER]