Upstream Texas - Fall/Winter 2016 - 8
THE NEXT REVOLUTION FOR
THE OIL AND GAS INDUSTRY
Allen Gilmer, Drillinginfo
CHAIRMAN - TEXAS INDEPENDENT PRODUCERS & ROYALTY OWNERS ASSOCIATION
AS INCOMING CHAIRMAN, I am honored to lead such an important and
enterprising group of operators and royalty owners. It is humbling to know
I am joining a long lineage of dedicated and accomplished board members
and industry leaders. It is the innovative nature of TIPRO members that has
led the U.S. oil and gas industry to become the engine behind disrupting the
status quo in global energy production, bringing energy independence and
increased security to the United States. I look forward to TIPRO's next 70 years
and know we will continue to lead in shaping the future of energy production.
Just as the technological advancements of horizontal drilling and hydraulic
fracturing have been the driving force behind the emergence of the U.S. as
an oil and gas powerhouse, the next revolution depends on harnessing the
predictive power of big data. While low oil prices have introduced serious
obstacles, and in many cases claimed victims, it is those companies that have
used the low-priced environment as an opportunity to innovate and increase
efficiencies that will emerge as leaders and define the next generation of oil
producers. Big data and analytics are the critical ingredient that have served
industry leaders up to this point, and will fuel their growth going forward.
A recent Bain study found that companies with better analytics
* Twice as likely to be in the top quartile of financial performance in their
* Five times more likely to make decisions faster than their peers
* Three times more likely to execute decisions as planned
Increasing the velocity of learning can give companies a huge advantage
over competitors. This is part of the reason why you see big oil companies
lag behind shale pioneers - many of them that are TIPRO members - who
out of necessity have found ways to do more with less.
I am excited to see the industry evolve to more accurately answer
questions like: How do faults affect production in a play? Which rocks
result in the best production, and why? What should I use as a proppant?
How important is vertical or horizontal wellbore tortuosity? What chemicals
should I use for my wellbore conditions? What is the difference between
using brackish water and fresh water?
Despite the promise that big data and analytics present in answering
these questions, there still exists obstacles that hold back E&P companies
from fully realizing its benefits. The problems companies face are twofold:
the ability to properly structure data so that they can analyze it, and organize
their business to operationalize the insights brought out by the analysis.
E&P companies have to merge disparate datasets that do not efficiently
talk to each other, resulting in a process that is so time-consuming it never
gets done. The workflow from data collection to analysis to insight to value
creation is simply too cumbersome and inefficient to implement. The key to
removing these barriers and unlocking the power of analytics is to build an
infrastructure that makes using data easier than not using it. That is when you
create a value engine that increases production and financial performance.
Companies with a successful data and analytics driven strategy rely on three
crucial pillars: people, process, and technology. Each is hugely important and,
like a three-legged stool, the system breaks down when one is not working.
At Drillinginfo, we focus on technology, but consciously design software
around how it complements the other two pillars. For example, the importance
of having a skilled workforce that can interpret and take action on a datadriven insight is important; however, as a consequence, it requires that you
raise the bar for employable candidates, making hiring decisions that much
more difficult. To counteract this, Drillinginfo builds products and features
such as the Decline Curve Analysis tool in Production Workspace which
makes insights easier to uncover and visualize, requiring less specialized
skill sets and increasing the pool of qualified candidates.
The process side of the system usually breaks down due to poor
communication and collaboration between departments and key stakeholders.
Drillinginfo has refocused its development towards combating this common
problem by building tools that facilitate teamwork and cross-discipline
collaboration. Finding ways to increase communication between teams is
crucial to executing on insights.
Ultimately, Drillinginfo focuses on creating the best technology that is
both powerful and easy to use. As we house more and more disparate
datasets under one roof, a synergistic effect is created that takes business
intelligence to the next level providing insights you never thought possible.
I look forward to seeing this group push boundaries further, continue
to contribute to our energy independence, and boldly carve new
It is the innovative nature of TIPRO members that has led
the U.S. oil and gas industry to become the engine behind
disrupting the status quo in global energy production, bringing
energy independence and increased security to the United
States. I look forward to TIPRO's next 70 years and know we
will continue to lead in shaping the future of energy production.
UPSTREAM TEXAS F A L L | W I N T E R 2 0 16 -17