Middle East in race for smarter way to run oilfields

Many of the crude operations in the region are relatively old and were set up long before the age of digital technology. But with the technological landscape now so changed, a new approach is gaining favour among drillers.

Integrating smart technology will help enhance recovery rates for the hydrocarbon sector. But bringing analogue oilfields into the digital age is not easy. Yasser Al Zayyat / AFP

About 85 per cent of oil fields in the Middle East are running on systems using analogue technology for operations and communications.

But the race is on to make fields smarter – more digital.

Think of it in terms of mobile phones. Previously, 3G was all the rage, then came 4G and now we are entering into the era of 5G.

Having such capabilities on mobile phones is common in the GCC but imagine applying that technology to rigs drilling for oil and you have what the ICT (information and communication technologies) solutions provider Huawei, which has branches in Dubai and around the Arabian Gulf, and others such as Honeywell are integrating into the region’s biggest industry.

According to the Shenzhen, China-based firm, integrating smart technology will help enhance recovery rates for the hydrocarbon sector. “The oilfield objective is to analyse in real time to optimise production, which is very important,” says Asfar Zaidi, the principal consultant for Huawei, Enterprise, Middle East. “Data in the oilfield is evolving.”

However, bringing analogue oilfields into the digital age is not a quick and easy process. Most fields are away from cities, meaning there is little to no infrastructure to help easily upgrade technology.

Companies are forced to build the necessities but then have to take into account interference and security. “Once you put [digital] security in place, it brings the performance lower,” Mr Zaidi says. The reason is that security methods take up bandwidth but are necessary to secure and protect the data being transmitted.

He says communication and connectivity is the most important aspect, such as removing narrowband radios and using broadband frequencies for real-time communication. He adds that Huawei has already introduced 4G to projects and is in discussions for 5G deployments. “For areas without 4G capabilities, you have to look into other solutions,” Mr Zaidi says.

And that is what has happened at Iraq’s Halfaya oilfield. The country only recently introduced 3G technology after several delays. Huawei previously worked on a project to help to increase daily output for the Halfaya oilfield via a wireless communications network. It built two base transceiver stations, covering 300 kilometres, by using its 3G technology.

The company says it provided a set of solutions covering terminals and platform devices, which helped create a "one-stop quick delivery". Should Iraq upgrade to 4G, this network could be easily upgraded. For the GCC, the technology is already 4G. Huawei is looking to jump-start a pilot project in the UAE to showcase the efficiency improvements smart applications can provide to the hydrocarbons sector. Mr Zaidi says it is as important to demonstrate the capabilities of the communication network that digitalising oilfields brings. "We're talking about high-performance computing, unified communication and collaboration," he says, adding that Huawei is currently in talks with Adnoc as well as foreign companies.

Norm Gilsdorf, the president of Honeywell’s high growth regions, Russia, central Asia and the Middle East department, says while there is a rise in customers looking to upgrade fields, the GCC lags behind the surge because of their age. He says many of the region’s large oilfields were developed during the analogue era. As digital technology arrived on the scene, it was more applicable to newer fields. “People aren’t necessarily in a position to go back to the oilfields because investments are in the new fields,” Mr Gilsdorf says adding that, usually, automated systems were designed for a lifetime of 20 to 30 years. “You can still get out of that field what you want without spending a lot.”

However, he believes the region is poised to soon take the lead in the digital oil field revolution. “The [GCC], of all regions, is often the first to uptake new technology and install it.” Mr Gilsdorf says if a comparison is done to the US and Europe, “really old technology” is still in use here. “I see this area as one of the biggest tech uptakers globally.”

Some believe smart fields will take off in the UAE due to the need to increase crude oil production to meet local demand. This country plans to hike figures to 3.5 million barrels per day bpd by 2017 from its current 2.3 million bpd.

The Adipec keynote speaker and environmental expert Michio Kaku says technology will dominate the oil and gas sector. With state-owned such as Adnoc looking to achieve recovery rates of as high as 70 per cent to maximise returns on maturing fields, digital oilfields will help the enhanced oil recovery (EOR) process – a method used to extract oil most commonly via gas injection.

Mr Gilsdorf says while digital technology could enable EOR, it is not a critical component. “You need more automation to do injections, but I’m not sure you have to rip and replace what already exists,” he says. “We’ll see it more for new fields wanting to start off with the best, or if they’re doing a major enhancement of a field or upgrade.”

Something Honeywell is trying to bring to field operators is a technology suite that helps to control things from managing alarms to monitoring equipment limitations which help operators to maximise profitability and reliability. Mr Gildorf says it covers an entire enterprise, going across a country to multiple sites.

He says various pumps can be monitored while data is continuously stored detailing when it was last maintained. Combine that with handheld technology such as iPads, and everyone from operations to process engineers are equipped to make better decisions. Integrating or upgrading this smart equipment is not easily priced. Mr Gilsdorf says technology for the wellhead and automation for the field depends on the well, field and location. He did say the cost was not significant compared with the cost of drilling or working a well.

The company is currently working with Al Hosn Gas, a joint venture between Adnoc and Occidental Petroleum, for the UAE’s Shah Gas Development project. The onshore sour gasfield is expected to be operational by early this year producing 1 billion cubic feet per day (Bcf/d), or 500 million cubic feet per day (Mmcf/d) after removal of the sulphur element that fives the gas its name.

Sour gas contains a high amount of hydrogen sulphide (H2S), which makes the processing more difficult. Not only is it expensive, it is also dangerous. Even in small amounts, Hs2 can prove fatal. Honeywell has supplied an integrated solution from automation to security to gas detection. Mr Gilsdorf says Honeywell is equipping workers with a gas detection unit that can be used when doing any maintenance, which alerts employees immediately to gas leaks.

With a large amount of gas supplies in the UAE deemed sour, technology and safety will be a major focus. “Sour gas can be lethal in small concentrations and therefore we need to bring the very best technologies and asset management techniques to make sure we don’t risk any workers,” says Andy Brown, the upstream international director at Royal Dutch Shell.

For Honeywell, the company has seen an overall improvement in efficiency albeit it widely variable depending on the well, which leads to higher production rates.

“We’ve seen from 1 to 4 per cent and in some cases higher improvement in performance by putting this technology in.”

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