Technology innovations driving OPEC’s hydrocarbon expansion
Exploration and production operations are facing a growing number of constraints, including increasingly complex fields, volatile crude oil prices, higher demand growth, and the need to factor in climate change.
Technology is crucial for the oil and gas industry to overcome these challenges. Over the years, technological innovations have been the most important element in helping the sector evolve, expand, and clear the various hurdles it has faced in meeting the ever-increasing demand for oil and gas in a climate-friendly manner.
Several factors usually act as enablers for the development and advancement of technology. For example, human talent, focused research and development programs, appropriate investment, and effective commercialization tools.
Technological advances have transformed the industry, but commercializing technology in the oil and gas market has always been costly and time-consuming. An average of 15 years is needed to move a concept into widespread commercial adoption.
A remarkable array of powerful new concepts, technologies, and equipment have been developed and used by oil companies for exploration, development, enhanced oil recovery, production, and processing. Geological modelling and improved sub-surface imaging through the use of advanced 3-D and 4-D seismic acquisition techniques and data processing feature among the newly applied concepts.
Directional, horizontal, and multilateral drilling, the use of high-pressure, high-temperature tools, improved reservoir data acquisition and simulation, stimulation and recovery techniques, as well as more efficient, compact, and reliable processing equipment are some of the other concepts that have been developed, too.
Such technological developments will continue unabated, likely covering the five main areas of remote sensing, visualization, intelligent drilling and completions, automation, and data integration, leading to a new and vastly improved set of tools that will enable the industry to better visualize oil and gas accumulations in the reservoir.
In particular, the integration of information digital technology and robotic innovation have yielded positive results in the percentage recovery and cutting emissions as well as in accessing more difficult fields and reservoirs.
The expansion of hydrocarbon resources and reserves have been supported by a range of new IT systems, including logging techniques, down-hole sensors and control systems, extended-reach and multilateral wells, coiled tubing for well work-over, more effective methods and products for well stimulation and treatment, and better subsea technologies.
Most recently, the emergence of industry 4.0, also known as the Fourth Industrial Revolution or 4IR, is having a huge impact throughout the oil and gas supply chain. One of the main benefits of its implementation in the oil and gas industry is how it is paving the way for a seamless production chain.
For example, one of the most notable uses of 4IR technology in recent years has been the digital twin – a virtual representation of a physical object. Digital twin technology allows oil and gas professionals to simulate design assets in real-time, providing powerful insights that maximize productivity while reducing the need to mobilize offshore and inspect the model.
The applications of these upstream technologies over the past four decades or so have contributed in a large way to a significant expansion of hydrocarbon resources in OPEC member countries. Many OPEC nations are advancing the development and implementation of exploration technologies that are not only increasing the chances of successful finds and reducing exploration costs, but also enabling improved reservoir management during development and production.
Advancements in drilling technology, such as remotely guided multilateral horizontal drilling, and deep-water and seabed drilling, have also enabled OPEC members to reduce costs, improve recovery rates, lower the water cut, and develop more challenging frontiers.
For instance, the application of the aforementioned technologies by OPEC Middle East producers such as Saudi Arabia, who already enjoy the lowest upstream costs in the world, has reduced their upstream costs further. And it also helped improve efficiencies and open up frontier areas across other OPEC countries. Focus is needed, in particular, on the continued development and use of technologies suited to the special characteristics of large oil fields typically found in some OPEC nations.
Offshore, the most advanced deep-water production technologies and development schemes are being undertaken in Angola and Nigeria. In Venezuela, the most sophisticated upgrading technologies to improve the quality of heavy oil are currently in operation and are expected to contribute further to the development of these vast reserves.
In Saudi Arabia, Aramco has been accelerating digital technology innovation to produce more energy with fewer emissions. The Dammam 7 supercomputer is the next step in Aramco’s digital transformation journey, complementing other advanced technologies the company uses.
These include 4IR breakthroughs in analytics, artificial intelligence, sensing, robotics, mobility, modeling, and cloud.
Aramco is also leading oil and gas robotic innovation. Robotics have the potential to transform how oil and gas companies operate – facilitating real-time, data-driven decision-making and prediction abilities.
The world will continue using oil and gas for decades to come. Technology innovations are and will be a major point for the industry to meet this demand in an increasingly climate-friendly and cost-effective manner.
There is little doubt that in the global quest to maximize production from oil and gas reservoirs new technologies will continue to be invented and applied in the coming years.
• Dr. Namat Al-Soof is an Iraqi oil expert with long experience in upstream and market analysis. He held senior analyst positions at OPEC, IEF in Riyadh, and OPEC FUND for International Development. Currently, he is a consultant to a number of companies in the oil industry.