- August 10, 2015
By Bill Lydon, Editor
A major theme of the recent Siemens Oil & Gas Innovations Summit was the need to apply automation to lower operations and production cost. More automation will enable producers to deal more easily with the cost pressures of the oil and gas industry.
By Bill Lydon, Editor
I attended the Siemens Oil & Gas Innovations Summit at Minute Maid Park in Houston in April, 2015. This third annual Summit focused on automation, set attendance records, and hosted a number of great speakers. A major theme of the summit was the need to apply automation to lower operations and production cost. More automation will enable producers to deal more easily with the cost pressures of the oil and gas industry.
The day before the Summit, I toured Siemens’ new Houston, Texas Analytical Products & Solutions Business Segment facility. The building is 73,000 square foot and includes 30,000 square feet of climate controlled production space. The new facility provides systems integration capacity increase of approximately 50% in order to meet increase in market demand. The Analytical Products and Solutions business provides a total solution from front-end engineering study and design to world class gas chromatographs (GC), continuous gas analyzers (CGA), sample conditioning systems (SCS), shelters, cabinets, and system integration (SI) production through plant commissioning and post-sale support services.
Raj Batra President, Digital Factory Division opened the event emphasizing Siemens long term commitment to the oil & gas industry.
Oil industry status
Donald A. Norman, Ph.D., Director of Economic Studies at the Manufacturers Alliance for Productivity and Innovation, discussed the turmoil in the oil and gas industry. Norman noted the price of oil has fluctuated over the years based on world conflicts and OPEC policy. Currently there is an oversupply of crude oil that has driven prices down. As always the long term prices are determined by supply and demand. Short-term price volatility is driven by inventories, worldwide spare capacity (primarily Saudi Arabia dominant), unplanned supply disruptions, U.S. Dollar value, terrorist activity, geopolitical instability, and speculation. Net United States imports of crude oil and petroleum products have sharply declined since 2006 due to local production. Interestingly, Bakken oil production continues to increase even as rig counts decline reflecting increased operating efficiency. The new oil being produced is light crude that sells for a premium on the world market but sells at a discount in the United States because the majority of refineries are configured to handle the heavier crude oils from counties such as Venezuela. Norman agrees with other economists. “Banning the export of United States crude oil makes no sense at all, we might as well ban the export of corn, timber, and other commodities,” said Norman.
Donald A. Norman, Ph.D., Director of Economic Studies at the Manufacturers Alliance for Productivity and Innovation discussed the turmoil and future in the oil & gas industry.
Oil Industry needs more automation
Erlend Agøy Engum, Senior Product Line Manager of National Oilwell Varco (NOV), gave an impressive presentation about their implementation of offshore drill floor automation. NOV Rig Systems make and support some of the world’s most advanced drilling solutions with the application of technology. NOV claims to have invented integrated rig control systems, starting with the first systems in 1990. Engum said that rigs must operate during demanding conditions including extreme heat and cold, gasses, and heaving ocean waters. Those conditions create many engineering challenges.
Erlend Agøy Engum, Senior Product Line Manager of National Oilwell Varco (NOV) described implementation of advanced automation on oil rigs.
NOV is using simulator testing and onsite automation to safeguard machines and processes. Engum showed videos of automation on an offshore drill floor rig that uses sophisticated controls, sensors, automated pipe handling and robotics. Pipe handling automation reduces the amount of personnel on the rig floor and driller’s cabin, improves operational speed, maintains consistency, and ensures that machines are run within operational limits. This has improved productivity and safety while minimizing risk, and increases uptime and improves performance of drilling operations around the globe.
NOV is collecting big data and using it to learn, optimize, and improve. In addition, operations are recorded similar to a flight recorder to capture everything that happens for post analysis to improve operational efficiency and incident analysis. Remote monitoring is also being used for management, diagnostics, and remote troubleshooting which allows them to leverage off-site subject matter experts.
NOV has implemented Hardware-in-the-Loop (HIL) simulation to improve training outcomes. They have eight of these trainers worldwide that can be configured to simulate the exact design of a customer. They test to the “100 year rare event” possibility. These systems are also used to virtually commission a rig. They can detect things such as potential collisions of equipment and poorly designed interlocks. In addition, the simulation models are being used on the rigs for onsite commissioning. NOV continues to use the installed technology to improve operations and to support condition-based maintenance.
The level of production automation illustrated by Engum rivals systems in automotive plants that are essentially fully automated and mechanized.
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