Digital Innovations in Oil and Gas with Geoffrey Cann

In case you missed it, WPC24 took place recently in Calgary, Alberta, for the second time in its history. WPC itself was established way back in the 1930s as a forum for the global industry to discuss common themes on a triennial basis. As a global event, it attracts an audience from around the planet.. The voices discussing the global energy industry’s challenges included the Energy  Minister from Saudi Arabia, and the CEOs of Saudi Aramco, ExxonMobil, Repsol, WestJet, Accenture, Pertamina, KNOC, Kuwait Petroleum Corp, ONGC, NNPC (Nigeria), NOCK (Kenya), Oil India, and managing directors, presidents, vice presidents, and board chairs from Cenovus, Petronas, Petrobras, Petronet, Suncor, Deloitte, Brookfield, Platts, S&P, Shell, and many others.  You never know who you’ll meet at such a gathering. As I ascended the escalator to the event floor for the opening ceremonies, I found myself standing beside a trade ambassador from Libya, who shared some personal details of the immense tragedy stemming from the floods from his country. My fellow panelists hailed from Calgary, Houston, and Saudi Arabia. I have a collection of business cards from Tema (Ghana), St. John’s, Midland (Texas), Bogotá (Colombia), Pittsburgh, Berlin, Washington, and Uruguay. Under the broad theme ‘path to net zero’, the range of topics under discussion were in equal parts bracing and confronting, taking in supply and demand, energy transition, decarbonization, industry growth and/or decline, financing strategies, infrastructure challenges, energy security, hydrogen developments, carbon capture and storage, net zero pathways, indigenous engagement, and talent issues. It is impossible for one person to summarize the conference because there are multiple parallel tracks, a full poster and paper show, and dozens of talks and panel discussions. You simply can’t take it all in. Then again, you can always form a point of view based on the dialogue you did take in, so here’s mine.

Markets are starting to show interest in commodity products that are produced more responsibly, notably natural gas. The key is to be able to prove it, and that requires some changes. Customers and markets are starting to demand evidence that energy products such as natural gas are making a positive contribution to buyers’ emission reduction goals. Responsibly sourced gas will experience demand growth, rewarding gas producers for their efforts at reducing emissions in the industry. Digital innovations have unlocked many businesses’ ability to offer variations of tracking and tracing services. Tracking is by far the easier of the two, and Apple, as one example, has created its AirTag product to exploit this opportunity. AirTags connect up with passing iPhones and relay their coordinates via the cloud to the AirTag owner, pinpointing the tag’s location.  Tracing is decidedly more difficult as it requires a date, time, and location log of the events, changes of state, and changes in ownership of the item that is being traced. There are few examples of full item tracing in industry for this reason. Tracing is doubly hard for commodities that are fungible (how dto you tell one organic tomato from another), or blended with other similar products (such as green energy). Tracing of energy is coming to the commodity industry as market participants express greater interest in energy provenance.

Companies working in the energy sector are now prosecuting their own self-defined pathways to achieve carbon zero or carbon neutral business profiles. Digital innovations play a key role. As part of the World Petroleum Congress, September 17-21, 2023 in Calgary, I was on a panel discussion to discuss digital transformation on the route to Net Zero. By now, hopefully, all energy companies will have defined their own pathways to zero carbon (either absolute or net). Our goal on the panel discussion is to peel this problem apart, layer by layer. It’s great that digital innovation is a topic at this event, a once-in-three years affair. The panel agreed that there is some consensus on the need to address climate change at an industrial level, and that the question is no longer “should we”, but “how should we”. The panel discussed the following: The drivers of change that provide the shape and contours of the net zero journey. The various pathways to net zero that could be pursued by the various players in the oil and gas value chain. The digital building blocks that the petroleum industry will leverage to achieve net zero. The panel hopes to reveal the outlines of how digital enables transparent, auditable and cost-effective carbon emission reduction strategies for petroleum companies. This will not be easy.

The energy worker of the future will require a different set of personal attributes than those normally selected for today. Energy companies may well find these attributes in short supply. One of my more interesting roles is the occasional advisory work for educational institutions on the skills requirements for the energy worker of the future. Since I research and write about energy topics, including energy futures, I do have an opinion on the likely skills, particularly those in the digital area. Now energy systems are entering a phase of high uncertainty. Major questions abound on the eventual scale of various energy products, such as the various shades of hydrogen, nuclear energy, battery and energy storage technologies, fusion, fossil fuels, the renewables, geothermal, tidal, and many others. Loyalty seems rather a quaint notion in an aggressive merger and acquisition world. Most schools lack the capacity to place risky bets on possible energy futures that might not play out, and so seek lots of input before making commitments to new educational directions. Digital innovations are evolving even faster. Recently I participated in a working session at SAIT on these questions, and this episode sets out some of the findings.

"Emissions combine all of the activities a company has. It's the tailpipe of the company, but it entails all of the activities that company undertakes." In this episode, I’m in conversation with Oleksiy Golovchenko who is a Senior specialist, EHS Data and Analytics with Ovintiv, a large North American oil and gas producer. Oleksiy has been part of a team delivering a real time emissions inventory management system at a highly granular level of detail across the full measure of the company. This is a hard problem to solve, and a lot of companies will want to simply buy such a solution. But Oleksiy discusses why there are no out of the box solutions in this field, that it requires a committed team and organization, and coding skills (not computer scientists) are needed. "There's no such thing as an out of the box Emission Inventory Management System. And the reason for that is that it needs to be configured to company individual requirements, business processes that you have." Oleksiy Golovchenko is a Senior specialist, Environment Health & Safety Data and Analytics with Ovintiv. He began his career working in environmental labs where he performed a range of chemical analyses for various media, including air, water, and soil. From there, he joined NOVA Chemicals, working variously in Catalysts, Polymers, and  Petrochemicals, earning co-authorship on several patents. At Ovintiv, he deploys automation to minimize regulatory compliance, sustainability, ESG and safety risks, turning data into actionable insights and creating disruptive innovation.  Oleksiy holds a Bachelor of Science in Chemistry from Simon Fraser University (SFU), a Master of Science in Sustainable Energy Development (SEDV) from the University of Calgary (U of C), and an MBA from the Jack Welch Management Institute. "Excel doesn't have the capabilities to handle the sheer amount of data, let alone have the functionality to do things you need to do. And let alone think about doing it all in real time, from a variety of data sources." USEFUL LINKS LinkedIn profiles (personal, business):  Personal: https://www.linkedin.com/in/oleksiygolovchenko/ Business: https://www.linkedin.com/company/ovintiv/  Website: https://www.ovintiv.com/https://www.ovintiv.com/https://www.ovintiv.com/  

For all the talk about energy transition, many aspects about transition remain unexplained. I’m in the midst of a home renovation. The renovation should allow the house last another 20-30 years with minimal upkeep, and may well be our final home as we embrace the ideal to age-in-place. The renovations are extensive—walls are being opened up for the first time in 30 years, the flooring is being upgraded, and we’ve had to move out for the four months it will take to carry out. What’s remarkable is that it falls entirely to me to take the initiative on all new energy ideas for the house. I would have thought that the instant I surface at the local planning office to secure a building permit, someone with knowledge about the national agenda for energy transition would be chasing me to encourage me to do the right thing, and embrace these (and likely other) innovations. Instead, it’s been crickets. In the meantime, I’m curious how many other aspects of modern life are going to cope with the transition. Here are four that puzzle me about how transition will work.

"I'm also a very strong advocate personally of a sort of an all in approach, meaning we aren't going to solve this with one magic silver bullet, right? If that doesn't exist, we need to develop these things over time." This is part two of a two part podcast recording with Tom Sharp, the Director of Permitting Intelligence with Arbo, and Justin Carlson, founder and Chief Commercial Officer of East Daley Analytics on the issues and challenges facing  energy infrastructure projects, and some of the solutions.  "Where we've arrived is a place where agencies are getting sued so much, that the process is getting dragged out and the cost of delays is used to halt projects, regardless of whether or not this is a project for traditional energy or renewables." Tom Sharp is a thought leader on infrastructure permitting and an expert in environmental and energy law and policy. His unique perspective is informed by 12 years of federal experience, most recently as Director for Permitting Excellence at the Federal Permitting Improvement Steering Council (FPISC), and by positions at the White House Council on Environmental Quality (CEQ) including Deputy Director for NEPA, attorney in the Office of the General Council, and Senior Advisor for Infrastructure. Tom also worked for 9 years as an attorney at FERC specializing in natural gas pipeline certificates and hydropower licenses. He graduated with a Certificate in Environmental Law from the Tulane University Law School and enjoys teaching law classes focused on NEPA and permitting reform. "If there's a transmission line that's being built from one state to another, crossing four different states, and those states in the middle aren't necessarily getting benefit from that, you're going to probably see increased opposition there." Justin Carlson is the Co-Founder and Chief Commercial Officer of East Daley Analytics. With a passion for strategy and deep expertise in oil and gas market supply and demand, Justin co-founded East Daley Analytics to creatively transform data and information into market moving knowledge and wisdom to drive client success. He has also authored articles on the energy financial markets for Forbes, Oil and Gas Journal, and Seeking Alpha. Justin has a BS in Mechanical Engineering and an MS in Engineering Management from the Colorado School of Mines.  "You've got all this data that you've actually got to normalize, bring together and that's what really slows the process down. It's not all unified. It is very independent and a bit disorganized and you're not always sure what to trust." USEFUL LINKS LinkedIn profiles (personal, business):  https://www.linkedin.com/in/justin-carlson-b8033b5/ https://www.linkedin.com/in/thomaslsharp/  https://www.linkedin.com/build-relation/newsletter-follow?entityUrn=7075561315259338752  Website: http://www.goarbo.com/  https://www.eastdaley.com/   

Tom Sharp, Director of Permitting Intelligence with Arbo, and Justin Carlson, Founder and Chief Commercial Officer of East Daley Analytics, discuss the permitting challenges for new infrastructure in the oil and gas industry. They explore hurdles in obtaining permits, complexities of value chains, acquiring land, and managing risks. Collaboration between developers and policymakers is emphasized for successful navigation of the changing energy landscape.

"We're creating a significant drawdown on the reservoir so we're able to get every last molecule of what's unrecoverable today that sits in the reservoir." In this episode, I’m in conversation with Herman Artinian who is the CEO of Upwing Energy, a company that has developed a compressor for downhole gas wells. One problem with gas wells is that they depressurize as they produce, which results in much of the gas (40% or more) being stranded in the well.  "We are able to boost incremental production by anywhere from 150 to 250%, which is significant." Upwing has taken a standard gas compressor, reversed it to pull gas out of a well, and packaged it to fit down hole where it is twelve feet long but only 5 inches in diameter. It took innovations from all kinds of places to manage this kind of repackaging. But the results are well worth the investment.  "You imagine how much work and energy and employees and technology is going into commoditizing this valuable asset (oil and gas). People kind of forget how much work it is and how big the supply chain is for this." President and Chief Executive Officer Herman Artinian has 30 years of experience in domestic and international business development and management, specializing in driving business growth by identifying and advancing disruptive energy technologies. Before leading Upwing Energy, Herman increased the profitability of multiple start-ups. At Calnetix companies, he oversaw numerous global licensing deals for Access Energy and played a key role in the growth of Direct Drive Systems (DDS), prior to the acquisition by FMC Technologies. Herman brings his passion for developing new energy technologies to Upwing Energy, driving his team to rapidly grow the natural gas service with industry- leading tools that increase production and recoverability in an economically and environmentally sustainable way. He holds a B.S. in Aerospace Engineering from the University of California, Los Angeles. USEFUL LINKS LinkedIn profiles: Business: https://www.linkedin.com/company/upwing-energy/ Facebook pages: https://www.facebook.com/upwingenergy Website:   https://www.upwingenergy.com/ YouTube: https://www.youtube.com/@upwingenergy Instagram: https://www.instagram.com/upwingenergy/  

If there is one industry that evolves very slowly, it would have to be the liquefied natural gas industry, and yet, digital is even making an impact here. As a digital nerd, I was alert to any digital developments at LNG 2023, but I was also curious what I had written back in 2016. At the time my weekly article series was called Fuel Up LNG, and chronicled Australia’s staggering rise from a gas exporting bit player to global LNG giant. I regret to inform you that not much has changed, really. It takes seven years to move an LNG project from conception to reality, if not longer. There’s not much iterative technology development happening, because the capital project life cycle is so long—a project is effectively just one iteration. Perhaps an expansion project can adopt some innovations, but there will be pressure on the project to stick with the status quo to capture scale economies. However, there were still a few pearls to share. Here are four key takeaways about the impacts that digital is having on the LNG sector.