Thanks for listening to the EKT Interactive Energy Podcast Network.

In this 17 minute episode, Marty Stetzer (EKT Interactive in Houston) talks with Eleanor Cannon who designed a senior level history elective entitled the: History, Geopolitics and Economics of Energy.

As she developed her course, Eleanor was looking for real-world operations content to supplement her extensive academic research. In 2019 we formed a partnership to integrate our digital Oil-101 with her curriculum design.

This podcast describes the benefit she has seen in the students with her somewhat unique course.

About the Expert

Eleanor Cannon

Mrs. Eleanor Cannon currently teaches a senior level history elective and is a field hockey coach at St. John School, in Houston. She has taught for over 20 years in independent schools.

She has used our digital Oil-101 series for a senior elective course that she designed called the “History, Geopolitics and Economics of Energy. To date it has been offered to 200 St. John's School seniors.

A Virginia native, Eleanor graduated with a Bachelor of Arts from Duke University and received a Master of Arts from the University of Houston.

She is married to E. Philip Kenyon Jr. and the proud mother of two sons.

Marty Stetzer – President of EKT Interactive

President of EKT Interactive in Houston; and producer of our mobile-ready energy series describing How the industry works.

It covers Oil & Gas, Power and Renewables.

In parallel with a 25-year energy career, Marty spent 15 years providing custom blended and e-learning training programs to a variety of technical audiences.

He has global upstream and downstream operations management experience with Schlumberger, Superior Oil-Mobil and Exxon, and was a director in the energy consulting practice at PwC.

Marty has his Bachelors Degree in Mechanical Engineering from Kettering Institute and a MBA from Carnegie Mellon.

Relevant Links

Oil-101 Course

Power-101 Course

Energy 101 – eLearning for the Energy Industry

Transcript

Marty:

Hi everyone, and welcome to Drill Down, our podcast channel that today will give you an insight on a really unique application of our Oil 101 series. I’m Marty, president of EKT Interactive in Houston, and I’ll be your host today. I’m speaking with Mrs. Eleanor Cannon. She’s the upper school history teacher at St. John’s School here in Houston. She has closely integrated our Oil 101 videos into a course to help it make it relevant. Eleanor, thanks so much for taking the time today,

Eleanor:

Marty, thank you so much for having me. I’m really looking forward to talking with you about how I’ve been using Oil 101.

Marty:

Can you tell our listeners your background and explain what motivated you to design the course and especially look for digital energy training for your students? Where did this idea come from?

Eleanor:

Well, I’m really fortunate, first of all, to be able to teach history to high school students. I get to talk about my discipline that I love all day long and share my passion for history with smart young people. I’m also fortunate I also get to coach. I coach field hockey, which is a great and entirely gratifying different way to get to know young people. And for the last 12 years, I’ve been teaching US history to juniors in high school at St. John’s School, and I have been asked to consider creating a senior elective. The goal of our senior electives is to expose students to wide variety of disciplines and all sorts of content that your standard US history class doesn’t cover.

And I was fortunate and kind of a coincidence, my son had just begun college in Virginia and he was taking a history class called Tobacco. And in the context of the state of Virginia, tobacco was a foundational commodity. He was enjoying his class so much and it was such a cool way to learn that I began to consider that model for my new course. My husband and I were driving around Houston one day and chatting about that and he said, “Well, what if you did a history of Houston via commodity? What would it be?” And we just looked at each other and simultaneously said oil. So that was the beginning of the idea of the class.

And so as I started to develop it, I talked to as many people as I could in the St. John’s community and in Houston about anything and everything related to the oil industry. I quickly decided that my go-to textbook was going to need to be Daniel Yergin’s “The Prize”. And I built the basic structure for the course that’s reflected in the official name. This is not my choice, but the official name of the course is “the History, Geopolitics and Economics of Energy”. I was hoping for Oil or maybe BTUs or something catchy, but college counselors want colleges to be able to recognize what students are actually doing in class. But I structured the course around those three components. A section of the course was going to be the history, a section was going to be the geopolitics which both of which I’m very comfortable with, and the third was going to be the economics, which was a little bit of a heavier lift for me.

But I was really excited about this concept. I started teaching the class for the first time in the fall of 2019. Some things were great off the bat. We started every single class, we still do, with a student reporting on what the West Texas intermediate price is and sharing some item that explains the change that day. And that has opened up all kinds of conversations. Early on we end up tackling and explaining bears and bulls. My first year in 2019, we spent a lot of time talking about the Aramco IPO.

But what was lacking in the class, obviously, it was very obvious from the beginning, was I really lacked any knowledge of how the oil industry actually worked. So I spent a lot of time sort of looking around for materials for me, for my own education, and fortunately came upon Oil 101 and took the class and found it tremendously helpful. When I started to plan the second go round in the spring of 2020… I can’t remember where this idea came from, but it occurred to me that I might reach out to EKT and find out if I might be able to access some of those materials for my students. And that’s the beginning of our collaboration, which has been incredibly helpful and fruitful for me and my students.

Marty:

Thanks so much, Eleanor, for that compliment. With that in mind, especially your extensive background in researching material, how many students have taken the course?

Eleanor:

So since the spring of 2020, roughly 200 students have used the digital Oil 101 materials, which is a pretty significant number –  given that our class sizes tend to be quite small. And also the course has gone from one section of semester now to two, in part because students enjoy it so much and learn so much. So that’s a not inconsequential number over the last couple of years.

Marty:

So remind me, is that juniors and seniors, or just seniors?

Eleanor:

Actually, this elective is only open to seniors. The juniors take US History.

Marty:

So as you went through this, what made Oil 101 a good fit for your classroom? And is it leading to follow up discussions or projects or people looking for other material?

Eleanor:

Well, from the beginning it really helped my students understand the oil industry, the value chain. For example, this section on LNG was incredibly helpful when we were talking about the geopolitical aspect of the course and thinking the conversation we had in class in the fall when what was going to happen with gas supply coming out of Russia given the war in Ukraine and sort of what’s Europe going to do, we were able to have a really informed conversation about potential of LNG. They also understood though the barriers, the cost of building liquefaction, and transportation.

So every conversation we have is informed. So not only have they gotten this basic understanding of how the oil industry works, but it has really enriched all the conversations we have beyond that. So in the history section of the course, when we’re talking about Titusville, we can begin to understand… They’ve already taken the Oil 101. And the entire upstream, midstream, downstream, there’s this moment of like, “Oh, so that’s where that came from.” And so particularly in the economics component of a class, we’ve been able to use the marketing and information in downstream about margins and capital, the difference between upstream capital risk. That’s just made the class… It’s just taken it and enriched it and taken it to a level of reality in the real world that has been tremendously, tremendously helpful.

Marty:

So what is some of the feedback that students have given you about the course?

Eleanor:

So one of the things that has, I think, struck all of us, including me at the beginning, part of it is the reality that any industry is as complicated. And Oil 101 makes it very simple and very clear although that many moving parts and that many different parts, again different components of the industry, I think really surprises them. They absolutely appreciate feeling knowledgeable. I think a lot of times high school students, particularly seniors, feel like they are being talked down to or they’re being treated as if they don’t know anything. And I think they find it really empowering to be able to say, “No, I really know how the oil industry works.” And there have been two things that students have come back to, alums have come back and talked to me about. One is how many of them have been able to use the information they gained in my course and from Oil 101 in particular, in talking in interviews for jobs, whether they’re internships in energy.

I’ve had a couple of students who’ve gone on and study petroleum engineering. I have one student at Brown University who’s doing some entrepreneurial work in the hydrogen space, all of which was inspired by what they learned in the class. So that is amazing. When a 22-year old can say to me, “I nailed that interview because what I’ve learned,” that’s fantastic, from being a teacher. I mean, what more do you want?

Maybe on a little bit more personal level, I’ve had a lot of students tell me that it’s enriched their conversations at home. A good number of my students have some connection, their families have some connection to the oil or energy industries and my students feel confident now or interested at least even interested in talking to their parents about what they do. And if any of you have ever had a high school student who the report you get back every day, “What did you do at school today?”

Nothing,” which certainly has been my experience often, I found a lot of people said that this class, because it’s practical and it’s real and it’s something that they can talk to in a very concrete way with their families, that it’s sparked a lot of conversations, which is a completely unanticipated benefit. And I think that’s fantastic.

Marty:

That is sure interesting to hear that coming out of a student community. Really enriches what we’ve been trying to do, so that’s just been awesome. I thought of something recently. Did this approach help you prepare for when you shifted to remote training during COVID?

Eleanor:

The timing of this was really interesting. My students actually used this… It was one of the last things we did in the spring of ’20 before everything fell apart. And then actually, I’m fortunate in that our school we were back in person by the time we were using it a second time. So I never really had the opportunity to use this in a fully remote setting. But one of the things I’ve realized is when there’s a kid who’s out sick, we’ve got people traveling through athletics, or also a lot of times seniors in both semesters are traveling to look at colleges and it’s the ideal tool for them to not fall behind and to stay on top of the class. If they miss a day where it’s discussion based or something, an interactive experiment in class, that’s very hard for them to make up. But Oil 101 is the perfect tool when you can’t be there.

And so I certainly hope we never have another situation where we have to teach remotely, but I now know that that can be my go-to tool in dealing with a situation like that, that that’s where I can start and spend… One of the biggest challenges was adapting curriculum to going online. I now know that I’ve got something that could give me kind of soft start where they could do that work and then I would have time to figure out how to change and adapt. So it’s a great gift and a little bit of sense of security that I have that in my back pocket at all times.

Marty:

Let me try another tact. When you discuss the course with other administrators or teachers, what do they think about this partnership and especially your class?

Eleanor:

It is a conversation stopper. I do a lot of professional development now thanks to technologies like Zoom from people from all over the country and I’ll introduce myself by saying I teach US history and a senior energy elective, and I get a lot of very curious follow up questions. And as far as I’ve been able to determine I don’t think there’s another high school class like this, certainly not one that I’ve been able to find. And believe me, I looked. When I had to create the class from scratch, I did a deep dive looking for anything that I might be able to piggyback off of. I have some data on that. When I proposed this class, the college counselors were curious, and so they did a lot of investigating and couldn’t find anything that really was similar to this class.

And one other data point, one of my former students is now in the Cox Business School at SMU. She attended a speaker series that involved Christian Wallace, who wrote the article for Texas Monthly called Boomtown and then turned it into a podcast, which we also use in my class. When she met him, she mentioned that she listened to parts of his podcast in her high school energy class. And here’s a guy who is in that space, thinks about energy, interacts with all kinds of people, and he was stunned. And so I think that piece has been really interesting.

And then as far as administrators, all of my administrative team here at school is incredibly supportive. As I mentioned, I’ve gone from teaching at one section a semester to two sections a semester, effectively doubling the number of students who are taking it. And when I explain to them what a key role Oil 101 has played and the support from EKT, they are just thrilled. It’s very unusual, at least in my world of independent schools, for there to be partnerships with business or people in the “real world.” To be able to have forged this real partnership that supports me as a teacher has just been invaluable.

Marty:

Eleanor, thank you so much for your insights. You’ve been a real innovator in energy education and we are happy you selected us to be part of it. Any other thoughts, stories, ideas you would like to share?

Eleanor:

I think one of the things that’s been most interesting to me is learning the stories from my students once they learn really what energy in the oil industry is like, where they see the connections with their families and their family history. It’s the knowledge they get from my course and the course materials from EKT has really helped them look at their families in a different way. I have them do a creative writing piece where they talk about… It’s an oil biography. They use the knowledge they’ve gotten in the class to take another look at their family. I’ve had people find old Super 8 movies of their grandparents and working as a roughneck back in the ’50s and ’60s. It’s just been really cool to see the many, many ways and the many levels in which energy and particularly the oil industry impacts people’s lives in this area.

And then also, I’m really looking forward to… I’m going to spend some time this summer, every semester I kind of revamp the course, reevaluate things that are working well and things that I want to add. I’m really looking forward to adding some of the EKT segments on Power, the Power 101. Not surprising, students are really interested in whatever happened to them in February of ’21 and I’d love to bulk up that part of the course with, again, some real substance from EKT. I also have my students, their final project is a oil public policy memo to a leader of a nation trying to comply with the Paris Accords. I’m really looking forward to incorporating some of the units from EKT on renewables that will give, again, more substance and heft to their research. I think that’s going to be a tremendous thing for helping them be better writers and thinkers about the energy transition.

Marty:

The energy transition is, we all know, is a very hot topic. So if there’s any way we can help bring your students into the real new world with Power 101, we will certainly do that.

Eleanor:

No, I’m really looking forward to our continued partnership and opening up new ways to learn from my students. Thank you so much.

Marty:

Well, my thanks to everyone for listening. Our company name, EKT Interactive stands for Energy Knowledge Transfer. We digitally capture the extensive knowledge of industry experts to pass it on to the next generation in a convenient format. If you are a professional or a student that is interested in the oil, gas, power, or renewables industry and want to quickly learn how that industry works, check out our digital on demand training series at www.ektinteractive.com.

© 2023 EKT Interactive.

 

The post Promoting Digital Energy Education in The Classroom with Eleanor Cannon appeared first on EKT Interactive.

Thanks for listening to the EKT Interactive Energy Podcast Network.

In this 18 minute episode, Marty Stetzer (EKT Interactive in Houston) talks with Diane Cherry. Prior to starting her own consulting firm, Diane worked for more than 20 years at senior levels in the energy and environmental fields.

We met virtually through the Energy and Utilities Network. In January 2023, she posted a blog describing new technology developments for long-duration energy storage.

Our Energy Storage Management digital training module was built in 2020. Diane's conversation will help our listeners get an update on this important topic.

About the Expert

Diane Cherry

Diane Cherry is the Principal of Diane Cherry Consulting, a woman-owned small business providing environmental and energy consulting services primarily in the Southeastern United States.

Her firm provides services in business development, policy and regulatory analysis, and communications.

She has extensive experience in public policy and communications around energy markets, technology, education, and finance. She regularly speaks at renewable energy conferences in the Southeast and nationally.

Prior to starting her own consulting firm, Diane worked for more than 20 years in the energy and environmental fields.

Diane holds a Master's Degree in Energy Policy from the Harvard Kennedy School, and a Bachelor's Degree in Economics from the University of Virginia.

Marty Stetzer – President of EKT Interactive

President of EKTinteractive in Houston; and producer of our mobile-ready energy series describing How the industry works.

It covers Power, Renewables and Oil & Gas.

In parallel with a 25-year energy career, Marty spent 15 years providing custom blended and e-learning training programs to a variety of technical audiences.

He has global upstream and downstream operations management experience with Schlumberger, Superior Oil-Mobil and Exxon, and was a director in the energy consulting practice at PwC.

Marty has his Bachelors Degree in Mechanical Engineering from Kettering Institute and a MBA from Carnegie Mellon.

Relevant Links

Diane Cherry Consulting

Energy 101 – eLearning for the Energy Industry

DOE – Long Duration Storage Shot

 

Referenced LDES Companies: 

Form Energy

Highview Power

Energy Dome

Antora Energy

 

Transcript

Marty:  Hi everyone and welcome to Drill Down – our podcast channel that now brings you insights on the clean energy transition.

I'm Marty Stetzer President of EKTinteractive, in Houston, and I will be your host today. And I'll be speaking with DianeCherry in Raleigh, North Carolina.

She has extensive experience in policy and communications on environmental issues, energy markets, clean energy technology, and renewable energy finance throughout the US.

Diane and I met virtually through the Energy and Utilities Network. In January she posted a blog describing new technology developments for long-duration energy storage.

We built a digital training module on Energy Storage Management in 2020. I thought it would be valuable for our listeners to get an update on this important topic.

Marty:

Diane, thanks so much for taking the time today.

Diane:

Thanks Marty good to be here

Marty:

Diane, as a policy and clean energy veteran, can you tell us about your consulting firm, give our listeners your (brief) resume and tell us what got you interested in this specific topic?

Diane:

I have worked in the energy and environmental policy space for more than 25 years as a regulator, at the state, and as an advocate. I have had my own clean energy consulting firm the past five years I work at theintersection of policy and regulation, communications and business development. My clients run the gamut of clean energy developers, advocates, renewable energy finance providers, city government, and higher education.

Marty:

Thanks Diane.. let's get started.

When we put our module together in 2020, the primary battery design for storage to support intermittent wind and solar only had a maximum four hours of duration. What is the business case for longer-duration options?

Diane:

Long  duration  energy  storage defined  by  the U.S. Department of Energy (DOE) as a system that can store energyfor more than 10 hours — is the lynchpin for solving the intermittency issues with renewable energy production. Whileshorter-duration energy storage (usually 1- 4 hours) can support some renewable energy generation intermittency, as more and more renewables are added to the grid, long duration energy storage is needed to store energy to be dispatched duringlong stretches when solar or wind are not producing.

A primary goal of long duration energy storage is to ensure that renewable energy can be stored when it is generated and deployed to meet sustained energy demand later. In this way, it supports the increased penetration of clean energy technologies; it also gives grid operators added flexibility to balance supply and demand, enables grid resilience, and enables costly transmission and distribution infrastructure upgrades to be deferred.

The trick remains storing energy at scale.

Marty:

In 2020, Pumped Storage Hydro was the prevalent long-duration storage option which could provide 10 or more hours of backup.  What is prompting the need for more options?

Diane:

Just to be clear, pumped hydro storage is the only LDES technology deployed on a large scale and will continue to dominate the market until 2030.

Development of a long duration energy storage market has received federal government support through ARPA-E, the research and  investment arm of the Department of Energy (DOE). The DOE also launched the Long Duration Storage Shot in July 2021 to reduce long duration energy storage costs by 90 percent (for systems that deliver energy ten or more hours) by 2030. Long duration energy storage will help the U.S. achieve a net-zero carbon grid a target the Biden administration has set for 2050 by dispatching low carbon power when needed and accelerating the retirement of gas peaker plants.

At the state level, California approved $126 million in incentives to demonstrate new long-duration storage technologies. New York State awarded US $16.6 million to five long-duration energy storage projects.

Marty:

Thanks Diane , Sure is a lot of money being spent!

Can you tell our listeners what the promising LDES options are being considered?

Diane:

Long duration energy technologies can be divided into electrochemical energy storage, thermal energy storage, flow batteries, and mechanical energy storage. And right now there are different commercial scale foreach of these categories. I'll just hit a couple of them.

Electrochemical LDES: Companies in this space are trying to find the sweet spot of lithium-ion batteries for long-duration energy storage. Earlier this year, an eight-hour duration lithium-ion battery project became the first long-duration energy storage resource selected by a group of non-profit energy suppliers in California.

Flow Batteries: Flow batteries are a subcategory of electrochemical energy storage that operate on the idea ofincorporating liquid electrolyte to function as a source of direct current electricity that runs through an inverter forconversion to alternating current power. Flow battery performance does not degrade, which is why there are fewerlimitations on use cases. While this continual performance stands out compared to lithium-ion batteries, which exhibit greater performance degradation if they are cycled multiple times per day or used for different applications, the only current commercial flow batteries are based on vanadium and zinc.

Marty:

A two part question [A] what programs around the world and in the US are relevant, and is the US ahead of, or behind, other countries in long duration storage development? [B] Can you cite specific projects that are under way around the world?

Diane:

Couple of things that are making the U.S. a key place for long duration energy storage right now. First theInflation Reduction Act allows energy project developers to benefit from a broad, bankable, and stable tax incentive scheme e.g. extending these credits out by 10 years to bring long-term certainty; making these credits technology agnostic and including storage.

The long duration energy storage ecosystem has been in labs and research institutes, and they are still at a very earlystage. While the national labs are integral to the U.S. scientific expertise true for energy storage we lag behind China, South Korea, Japan in research funding.

On the whole, the sector has struggled to go from promising ideas to promising businesses and funding has been a keyreason. Technology developers will struggle to scale cost-effectively before 2030.

Clear geographical disparities exist in the development of the LDES market.

• For the Asia Pacific region, the deployment of vanadium redox flow batteries and compressed air energy storage has accelerated rapidly in China, which has been largely driven by strong policy supp The world's largest redox flow battery energy storage system, 100 megawatts (MW)/400 megawatt hours (MWh),connected to the grid in Dalian, China.
• Most European countries have been less enthusiastic. The UK Government has been an exemption, as it explores the role long duration energy technologies have to offer, while actively seeking to support industry players.

Turning now to the US

• One of the biggest LDES electrochemical hopes is Form Energy, an alternative battery player. The company has raised more than $800 million for an iron-air battery that it says can store 100 hours of energy at system costs that are competitive with conventional power plants. Form's first battery manufacturing facility is set forWeirton, West Virginia, with finished batteries expected in 2024. Another is
• Xcel Energy Minnesota that will deploy a 10 MW/1,000 MWh multi-day storage

system at the Sherburne County Generating Station in Becker, Minnesota. Xcel

Energy Colorado will deploy a 10 MW/1,000 MWh multi-day storage system at the Comanche Generating Station in Pueblo, Colorado. Both projects are expected to come online as early as 2025 and are subject toregulatory approvals in their respective states. Finally

• Technology company Third Derivative has backed half a dozen flow battery startups, including new generations of flow chemistry that use organic compounds and alternative materials to vanadium.

Marty:

Diane, with all this happening where do you see storage developments going in the future?

Diane:

While there is no clear LDES favorite yet, the winner will ultimately target different value propositions that puts it in a different league than li-ion. Because li-ion has such a strong hold on the energy storage market, a leadingLDES technology must demonstrate more than just a marginal benefit over li-ion. By targeting a niche application,LDES technology providers will more easily be able to demonstrate its distinct value to the market.

Marty:

Are there any industry leaders in the LDES field that our listeners should start to follow?

• Form Energy is one in the US that I've already discussed.
• Highview Power Storage (UK) Liquid-air energy storage solution that can deliver enough electricity to power over 200,000 homes for 12 hours in two weeks.
• Energy Dome (Italy) Energy Dome is an Italian startup that has developed a new technology for large-scale and long-duration energy storage. Their patented technology is based on a thermodynamic process that uses CO2 to preserve electricity at a low cost and with unparalleled round-trip efficiency.

• Antora Energy- US The startup utilizes zero-carbon heat and electricity to electrify heavy industry. Antora Energy has developed low-cost, long-term energy storage by storing heat energy in extremely cheap raw materials.

Marty:

Diane, thanks so much for your insights! They will sure be valuable to your audience and our own community of 8,500 EKT interactive followers.

Are there other resources available on this topic that you can recommend to our listeners?

Diane: Sure. At our website, dianecherryconsulting.com, has three blogs that describe the different categories of long duration energy storage and the use case for each category. So, I recommend everyone visit our website. Also, you can email me at [email protected] and I’ll be happy to answer any question.

Marty:  Thanks to everyone for listening Our company name EKT interactive stands for energy knowledge, transfer digitally capturing the extensive knowledge of clean energy industry experts, like Diane.

If you are a professional that is new to the oil, gas, power or renewables industry, and want to quickly learn How that industry works check out our digital on-demand training series at www.ektinteractive.com.

© 2023 EKT Interactive.

 

The post Long Duration Energy Storage with Diane Cherry and Marty Stetzer appeared first on EKT Interactive.

Improving Drilling Scheduling with Owen Plowman of Actenum

In this episode our topic is How improving drilling scheduling can benefit operational performance – more importantly, how not to miss your targets.

We’re really happy to learn more about improving operational performance at this time of unprecedented challenges in our industry – answering questions like:

• What are the challenges as operators manage their drilling program schedules?
• Operationally, this must be particularly applicable to shale plays steep decline curves, multi-pad drilling, huge volumes of water and sand, and the frack crews. True?
• Can you share case studies where operators have seen payoffs by improving schedules?
• Who needs to be involved with this process to achieve some of these efficiencies?
• What are some unique capabilities of the Actenum scheduling software application?

Relevant Links:

Drill Down Oil and Gas Podcast

EKTi Oil-101 Introduction to Upstream

About the Experts

Owen Plowman

Owen Plowman – Vice President of Business Development at Actenum Corporation. His role is to merge his software technical skills and knowledge of the oil and gas industry to advance Actenum's product capabilities and address customer challenges.

Prior to joining Actenum in 2006, he spent 14 years at Oracle Corporation Canada, Inc., managing sales consulting, technical support, marketing, and professional services.

Owen has worked in the IT industry for almost 41 years: he began his career writing commercial software in 1979. After completing degrees in molecular biology and computer science, he joined Meta Systems Canada (a software start-up), where he led development efforts and consulted on projects for Canadian and US government agencies and defense contractors.

Mr. Plowman holds a BS in Biology and an MSc in Computation from McMaster University.

Marty Stetzer

In parallel with his 25-year energy career, Marty has over 15 years experience in providing custom digital training programs to a variety of oil and gas technical audiences – like EKT Interactive Oil 101.

Marty has been a consultant to U.S. and international oil and gas
companies since 1986, including 13 years with PriceWaterhouseCoopers.

He has 18 years management experience with Schlumberger, Superior Oil-Mobil, Wilson Industries and Exxon.

Marty has worked with numerous national and international oil and gas company managements to help improve business performance across upstream, midstream and downstream operations.

Like many of the team, Marty is active in the Society of Petroleum Engineers and often presents at industry forums.

Transcript:

 Marty:

Hi, everyone and welcome to Drill Down, our podcast channel that routinely brings you new insights on oil and gas operations. I’m Marty Stetzer, President of EKT Interactive in Houston, and I will be your host today.

Our topic is How improving drilling scheduling can benefit operational performance, and, more importantly, how not to miss your targets. And I’ll be speaking with Mr. Owen , VP Business Development at Actenum Corporation in Vancouver. Owen has over 40 years of developing software applications for the oil and gas industry.

We’re really happy to have his input on this topic at this time of unprecedented developments in our industry. Owen thanks so much for taking the time today.

Owen:

Hi, Marty. It’s great to be here.

Marty:

Owen, as an industry and IT veteran, can you give our listeners your background as it relates to today’s topic?

Owen:

Sure. As you mentioned, I’ve been in the industry for 40 years, a little over 40 years now actually, and I come from a computer science background that’s what I studied in university. My perspective has been shaped by my experiences. I came out of my master’s degree, and I spent eight years working mostly in the defense sector with a small software company.

And then I went to work for Oracle and I was there for 14 years. And of course, Oracle is a gigantic software corporation and it was a really interesting ride. I spent most of my time working in the finance sector and federal and local government.

And then I went to Actenum, where I’ve been for about 16 years, and I’ve worked with oil and gas customers of all different sizes global customers, national oil companies, super majors, and all the way down to small US independents.

My perspective has been shaped by that experience and, of course, by what my company does, which is scheduling in the upstream world. The thing that I’m always interested in, my major interests, besides my job objectives are, and I’ve done this right from the get-go, why initiatives are successful and why initiatives fail and what lessons may be learned from that.

That’s really what shaped my perspective and led to me getting where I am today.

Marty:

So let’s get started, Owen. What are the challenges as operators manage their drilling program schedules these days?

Owen:

Well, I think that the major challenge is the understanding of what a schedule actually provides to an organization. When you’re an operator, you can think of the schedule as a way of figuring out when a particular rig is going to be spudding a well, or when is a well going to be tied in.

What you’re thinking about there is really just resources, activities, and dates. And what you should be thinking about and what is starting to happen in the industry is that you think about the schedule as an operational model of your organization.

When you start looking at the schedule that way as a model of your operations and the effectiveness of your operations, then you start asking a lot of interesting questions which are material to your performance.

How efficiently are we using our rigs and frack crews? What’s the average cycle time and is there anything we can do to reduce it? That is the time between spudding a well and tying it into production. What is the production that we’re expecting to achieve over a particular period of time, like the next two quarters or the next year? How much is all that going to cost?

And more importantly, questions about how you might change your operations to be more efficient and more effective. What if we added a rig in the fourth quarter? What if we added a frack crew in the second quarter? What if we changed the way that we were drilling and we tried to use more efficient rigs, what would that cost and what would the payoffs be? Those are all really important questions and good questions.

And the challenges that I see right now are that some organizations are not positioned for success in that kind of thinking, because they’re using what I call traditional tools or 1990s technology. They’re working with manual spreadsheets. Microsoft Excel is the one that comes to mind. It’s probably the biggest… When people say, who is your competitor?  I always say it’s usually Microsoft Excel. They use project management tools from the 1990s, like Project and Primavera, and those are not really oriented to really exemplify the model of upstream operations.

It’s very difficult for people to get the answers to questions that they ask, when they’re using those kinds of tools. You need to think about integrating your operations and bringing all of your upstream disciplines together in one schedule application. So that you’re not only thinking about what’s happening in drilling you’re looking at the whole range of operations from pre-spot drilling, completions tie in, or through workovers, even sometimes down to plugging and abandonment. Those kinds of things are quite difficult using traditional tools, but it’s what people are focusing on even more and more as we speak.

It’s been, probably a change has been going on since about 2012, and now we hear about it all the time from companies that contact us. It’s something that they’re really starting to think about, because obviously the industry has gone through some horrific downturns and everybody’s trying to figure out how to be more efficient and do more with less.

Marty:

And again Owen, from an operational standpoint, this must be particularly applicable to the shale plays steep decline curves, multi pad drilling, huge volumes of water and sand, and in the frack crews. I guess that’s another perspective that the operators have.

Owen:

This is exactly what led to the change that I mentioned just now that’s been going on since 2012. I would visit Houston a lot in the late first decade, so 2008-2009, and I would show our software to people. And they would go, “Oh, that’s quite interesting,” but nothing would ever come out of it. They wouldn’t adopt it, because they figured, we’re getting stuff out of the ground. Price is good. Who cares about a little bit of efficiency gain here and there? They weren’t drilling that many wells.

I started visiting Houston again in 2012, basically once a month, and it was crazy because it’s all many more wells, lots of resources, all these moving parts, much higher level of coordination among operations, things to worry about like frack materials, drilling materials, and so on. Everything has to be coordinated. Some things have long lead times, so you really have to have a handle on when you need certain kinds of bits, for example. All that stuff that’s coming out of the unconventional, I think, has been leading to the push for higher efficiency and better scheduling.

Marty:

What have you seen are some of the payoffs for improving schedules? Can you share some case studies with our group?

Owen:

Sure. Without revealing any names, I can tell you about some interesting ones. We had one recently in the last couple of months where I heard that one of our customers was receiving a CIO award. I was kind of intrigued. So I phoned him up and said, “Well, what’s happening? How come you’re getting this award?” The two reasons are that using our software, they were able to save a thousand person hours of scheduler's time over the course of the year. And that’s because our software automates much of the functions that they would do on a day-to-day basis.

Changing the durations of activities and moving activities around in time that saw routine with our software and it takes minutes. We heard that using alternative tools, it might take up to a week to get the schedule in sync because of the changes that occur in the operational world.

These guys saved a thousand person hours of schedulers' time. And because they could use the software to look at the schedule from different perspectives, they weren’t stuck just looking at what the resources were doing. They were able to look at what was actually happening with individual wells and multi-well pads.

They could actually look at the cycle time, and they were able to shave some of the cycle time off and remove the white space from the Gantt chart, so activities move closer in time, and that saved them $30 million.

That’s why they are getting that award.

Other things that we’ve seen, we were working with a US company about four years ago, and they needed a better way to create what if scenarios. They were trying to maximize the drilling budget, and they were running all these scenarios with monthly production forecast to figure out what mix of rigs and frack crews should we really have as we go forward.

That process used to take them five engineers, and two weeks of time, because they were working with manual process, manual tools. And using our software, they were able to get the forecast that they wanted with two engineers in one day. So that was a very significant change for them.

Going back about 15 years, one of the first things that we saw with our software was the problem of optimizing rig scheduling to minimize unnecessary travel. We worked with a very large national oil company. They had a lot of situations in their schedule like this.

You’d have a couple of rigs. They would be about a hundred kilometers apart, and then they would both move and each one would go within about 10 kilometers of the other one’s starting point, right? They would actually pass each other on the road. What they really needed to do was to move one rig 5 or 10 kilometers to the next well site. And instead, they were bringing in this other rig and making it move a hundred kilometers.

The problem there is you’ve got a lot of unnecessary move time that you’re paying for, and you’ve got a lot of time wasted trying to get to first oil, because obviously drilling is delayed because of this gigantic move. So within three months of using our software because we geo-and tag everything, all our locations and all our resources they were able to get $5 million in savings and reduce the average time from spud to first oil.

Those kinds of things are what we’ve seen. Another big area is in what we call schedule conflicts.

We were working with an operator and they had the drilling people use one scheduling tool and the completions people use a completely different tool, have a completely different schedule, and then they tried to keep them in sync.

And they kept running into these what we call schedule conflicts where, for example, the completions team would show up to complete a well and they would discover that it was still being drilled and that the rig was not going to be freed until about four or five days later. So then what do they do? Sit around and do nothing, and that’s costing the company money.

They would also have a situation sometimes where a completion crew would show up and the pad would be totally empty. The pad had been built, but there was nothing actually on it. There wasn’t even any drilling scheduled, and it wasn’t scheduled to occur for some months.

What we were able to do… They were running into this five or six times a year, I think. We were able to get them down to about one time per year. And each occurrence that we were able to eliminate, they estimated it would cost about $1.4 million in people’s time.

That doesn’t count the time for the completion crews or whoever to sit around and do nothing or be redeployed, but just to resolve that kind of conflict was taking $1.4 million in people’s time. So that savings went right to their bottom line. Those are some of the benefits that people have seen.

Marty:

Owen, that is really impressive. But how do you pull this off? I’m hearing drilling. I’m hearing completions. I’m hearing stimulation. Of course, the associated service companies. I’m hearing production Who’s involved with this process to try to achieve some of these efficiencies?

Owen:

We could do a whole other talk about that, about what I’ve seen in terms of performance improvement initiatives but I think that the process of gaining these efficiencies requires what I would call an integrated well delivery framework, which is structured to provide the entire organization and all of the disciplines involved with data that they need and with measures that they need to understand so that they can determine whether they’re being really effective.

You bring together all the disciplines from G&G, reservoir planning, drilling, completions, workovers, and so on. All the execution, and you can actually use the scheduling platform as a mechanism to have everybody collaborate and gain feedback and pass that feedback between all disciplines. And that leads to enhanced performance.

What you need there is access to the data on demand that is required by each individual across the whole set of disciplines, elimination of the territorial behavior that sometimes we see between the disciplines where people won’t share their data, and sustained involvement of management and a commitment to change things. Now, that can be a lot for an operator to chew on all at once, but you can gain significant value from executing any one of those things.

Of course, I come from a company that sells scheduling software, so my initial reaction would always be, well, buy our software and it’ll make everything better for you. But you don’t have to do that. You really have to think about change management, because the people will make or break the performance improvement initiative, and what you need to do in your organization just to make sure that you’re positioned for success and improvement over the long haul.

Marty:

Speaking of performance improvement, I’ve spent time at Schlumberger and what you’re describing sounds to me like some of the more successful field development planning projects that we executed with the cross-functional, cross-discipline folks finally getting in the same room and working together. Is that another good analogy?

Owen:

Marty, it’s a very, very good analogy. We’ve actually had projects fail, particularly in some national oil companies where disciplines won’t share their data. We were trying to help an organization once improve its whole drilling program and bring better scheduling into place. They were very keen on optimizing their schedule and aligning it with targets, right? One of the targets that they wanted to work on was production. How do we assemble our rig resources and what wells do we drill to achieve a certain production level over a year or over half a year?

Well, they couldn’t get the production data because that was handled by a totally different discipline, and the VP would not allow that data to go outside the discipline. I heard this and I shook my head, and I called my contact up and said, “Well, what do you mean? Why doesn’t your drilling VP talk to that production VP and just say outline the reasons why we need that data?” Tried it. Doesn’t work.

You simply can’t have that behavior in an organization that’s trying to improve performance.

There needs to be some kind of management intervention at a higher level there which says, “This is what we’re doing. Get on the train and let’s all move forward together.” That’s the kind of thing that needs to be in place.

Marty:

Owen, in addition to being a cross-functional application, is there any other special items about your scheduling application that you’d like to talk over with us?

Owen:

I think the traditional tools that I’ve mentioned earlier, like Excel, Project, and Primavera, those are not specific to oil and gas, obviously. I mean, Excel is a general purpose spreadsheet and Project and Primavera are project management tools, but they don’t care whether you’re managing development of a nuclear power plant or building a bridge. There’s no well-based model in those applications. They don’t understand anything about production.

They don’t understand anything about well locations surface hole, bottom hole, geographic orientation, whether the well is vertical, multi-lateral, horizontal.

They don’t know anything about interference that may occur between wells. You’re deciding on fracking a particular well or drilling a particular well and what you find is that you’re in the zone of interference for a producing well. And if you carry on, you’re going to have an impact on the production and what may be even worse is that it’s somebody else’s well and not yours, and then you’re going to have to pay them some kind of penalty.

What our software incorporates is a very comprehensive well model that has been developed over the 16 years that we’ve been doing this, developed in conjunction with customers. It captures all of the relevant data that a customer would want not all of which has to be used. Some small operators won’t care about some of the data items that they could populate, but it’s specifically designed for well delivery operations, so taking a well from concept all the way through to actually putting it online and getting production out of it.

Marty:

With your application and the drive for efficiency, are there some other industry trends that you’re seeing in managing upstream operations?

Owen:

I think besides the increased thinking about efficiency and what can be done operationally to achieve that efficiency, we’re seeing more integration of operations.

We used to show up and customers would say, “Here’s my schedule, and it’s just rigs and completion crews and dates for doing activities, and these are the well names.” What we’re seeing now is increased sophistication on the part of the operators. Even if they’re using traditional tools, they’re trying to align multiple spreadsheets, so they’re tracking production in one spreadsheet and they’ve got the schedule in the other.

We’re seeing much more sophistication and increased appreciation of why that’s important. That’s one thing that we’re seeing.

More integration of different functions, people are bringing together the pre-spud activities, the drilling completions, facilities pipeline, and so on, and workovers.

We’re seeing increased interest in deployment in the cloud. Six or so years ago, I went to all of our customers in the US and I started asking about cloud deployments, and every single organization said, “Not on our radar. We have no use for cloud. Not something we’re interested in.”

Two years ago, I went back and revisited that question and every single customer said, “Cloud is definitely part of our strategy moving forward with our IT applications.” We have the ability to deploy locally or in a cloud. That’s been available for a couple of years now.

I think there is an increased interest in bringing some of the field development planning capabilities into the same tool as the execution scheduling function.

Development planning is looking at aspects of the operations saying, “I’ve got a billion dollars to spend in a year. Where am I going to drill my wells? What do I need to do about my gathering network? What do I need in terms of resources, and so on, and how am I going to spend that billion dollars wisely?”

And what comes out of that plan, it’s the step before you get into the execution scheduling usually. And then the question is, so what resources do I need to mobilize to make that plan a reality and execute it over the next 18 months or whatever?

And currently, the situation is that those functions are generally done by different tools. Sometimes spreadsheets are used for both, but there has to be some sort of linkage between them. One of the things that we’re working on and we’re doing that as a result of some questions being asked by our customers – is how can you bring those two functions together in one application so I have seamless integration between my plan and my schedule? Because, of course, the plan may change.

If you go out and start drilling some wells and you discover certain things that lead to the G&G people thinking about the reservoir and that translating across all the disciplines and changing the plan, you need to be able to put a sort of feedback loop in process between those disciplines that goes very rapidly. Seamless integration across planning and execution scheduling is really important. That’s something we’re working on and we’ve had some initial successes with that. We’ve been working on that for about four or five month.

Marty:

Owen, that was terrific. Thanks so much for your insights. This will surely be valuable to your audience and our own community of 10,000 thousand EKT Interactive followers.

Thanks to everyone for listening. Our company name, EKT Interactive, stands for Energy Knowledge Transfer. We digitally capture the extensive knowledge of industry experts like Owen.

If you are an analytics expert or an IT professional that is new to oil and gas and want to quickly learn how this industry works, check out our digital on-demand oil and gas training series at www.ektinteractive.com.

Thanks again.

Sponsors:

EKT Interactive Oil and Gas Podcast Network

Oil 101 A Free Online Introduction to the Oil and Gas Industry

The post Improving Drilling Scheduling with Owen Plowman of Actenum appeared first on EKT Interactive.

Tips for Attending the 2018 Offshore Technology Conference in Houston, TX.

It’s that time of year again…

In this episode of ‘The Drill Down’, Marty Stetzer sits down with Michael Deleon, long time media producer for EKT Interactive, to discuss ways in which listeners who may be attending the Offshore Technology Conference (OTC) for the first time get the most out of their experience.

Relevant Links:

Offshore Technology Conference

EKTi Oil-101 Introduction to Upstream

About the Experts

Marty Stetzer

In parallel with his 25-year energy career, Marty has over 15 years experience in providing custom digital training programs to a variety of oil and gas technical audiences – like EKT Interactive Oil 101.

Marty has been a consultant to U.S. and international oil and gas
companies since 1986, including 13 years with PriceWaterhouseCoopers.

He has 18 years management experience with Schlumberger, Superior Oil-Mobil, Wilson Industries and Exxon.

Marty has worked with numerous national and international oil and gas company managements to help improve business performance across upstream, midstream and downstream operations.

Like many of the team, Marty is active in the Society of Petroleum Engineers and often presents at industry forums.

Transcript:

Hi everyone, and welcome to the Drill Down with Marty Stetzer. This 12 minute podcast is part of our EKTI Oil and Gas Learning Network, and brought to you by Oil 101, our free introduction to oil and gas. Our subject today is how to get maximum benefit out of visiting the upcoming Offshore Technology Conference OTC in Houston.

This is short notice the 2018 OTC starts Monday, April 30 and runs through Thursday. You can get in for free by using Google. Search on OTC 2018 complementary pass.

Today I'm joined by Michael DeLeon He has been working with EKTInteractive for the last three years designing and developing high-quality interactive audio and visual education products for our 10,000 member community.  

I'm getting Michael help to explain how other graduates and folks the industry can come up the curve on how to leverage their OTC visit.

Michael welcome.

Michael:

Thanks Marty happy to help out..

Marty:

Can you give our audience a little of your background.

Michael:

Certainly! I'm usually the guy behind the console telling others how to speak, so this should be interesting.

My background is in visual communication. I have degrees in both Digital Media and Instructional Design from the University of Houston, which happens to be our hometown. The OTC is a really big deal here; anyone connected to or interested in oil and gas should really check it out. Even for someone like me, it helps to understand the industry better, and let's me think of ways to apply this knowledge in training and education scenarios.

Marty:

Michael, one of the best learning opportunities in Houston the first week in every May is the OTC. As a mechanical engineer, I think it's the world's biggest science fair!

But what was you reaction as more of a visual communication expert

Michael:

My first reaction was, Where do I begin !

The first thing I noticed was how much technology is used at the vendor booths; multi-display videos, interactive screens, VR, augmented reality, even gaming. There are lots of interesting and creative ways being used to capture the audience's attention.

It's awesome, but can also be very overwhelming on first sight.

So Marty, how about some help? If this is the first OTC for our listener, what are some clues to make their first time at the event productive?

Marty:

The first clue is to have an objective. If you go there without one, you're just blown away by the hundreds and hundreds of booths, each one trying harder than the other  to sell you and explain what they're doing.

There's no way that a first-timer can get much out of it without making a list of target companies that you want to see.

There is a free map when you register. Mark out the location of the target company booths on the map. Figure out a inefficient path so you're not zigzagging all over the place.

Michael:

But what do I look for??

Marty:

If you've seen the movie BP Horizon You might want to visit Halliburton to learn what cementing is really all about, Cameron to see a real live BOP or Transocean to learn more about drilling rigs .

Another way is to pick a Houston company name you have seen in the Chronicle or heard on TV or the radio Like Schlumberger, Baker Hughes or GE oil and gas.  

Michael:

Interesting I did see the movie and liked it Might take your advice

Marty:

You can also learn a lot by looking for the Spotlight Award winners  – listed on the OTC website. This award recognizes the best technology inventions of the past year.

Engineering graduates see how their classroom studies get translated into real iron and the latest technologies Even though it's primarily in oil and gas conference, you'll find innovations by mechanical, electrical and chemical engineers and especially IT experts not just petroleum engineers or geologists. There are some things to see and learn, no matter what your interest is.

Your media background is different.  As you visit any of the booths note how they communicate their winning idea (both visually and graphically), how it works, and what the benefit is. A good test is how big the audience is in front of the booth – follow the crowds!

The need for clear and interesting communication of these technical messages is a booming industry in Houston.

Michael:

Marty, for our listeners, what else is available at the OTC.

Marty:

There's a daily university R&D showcase  – with details on the OTC.org website

Over 350 technical papers will be presented, often in panels, on the second floor of NRG Center. The papers are peer reviewed and professionally delivered. They are sponsored by technical societies, like SPE, Society of Chemical Engineers, and many others.

In addition to the booth, awards, and tech papers, there's a series of breakfasts and luncheons. They cover quite a wide variety of topics many that you might not think would be at an oil & gas event.  You can learn about process safety management prevalent in the Chemical industry and new offshore wind farms.

In our case EKT interactive has established a solid reputation in podcasts dealing with oilfield digitization technologies like AI, machine learning,  edge and cloud computing. So, I will be attending Monday to listen to two offshore digitization case studies.

Michael:

Marty any clues on logistics?

Marty:

First, wear really strong shoes or your cowboy boots, because no matter how well I lay out a plan I always end up doubling back and tripling back.

Sure As a reminder this year the OTC is at the NRG Complex,  and runs from Monday April 30 to Thursday May 3.

As a student with a university ID your cost to attend is only $25 per day. Or try for one of the free complimentary passes.

Finally, do not drive to the OTC. No matter what they tell you or what time you go. Even if you're there at 7:00 in the morning, you can end up parked in the boondocks. The best way to go to the OTC is to park anywhere near the line and take the Metro train.

Michael:

Awesome I've use the train when I lived on the east side . Works great.

Marty Any more hints, say on scheduling

Marty:

It's a 4 day program. Over the years, I've learned from my buddies that there are good days and not so good days if you're new to the OTC.

Monday once is good because everyone is fresh. They vendors have their best people on the booth and everyone seems pumped! If you're going to see the Spotlight Award booths,  you'll get the sharpest individuals to give any needed explanations on Monday.

Tuesday is really crowded because a lot of the folks come in from Louisiana.  After hitting their office they fly over on Monday evening and show up Tuesday morning. Tuesday is usually a mob scene!

Wednesday's also a good day, but some of the booth presenters seem to run out of gas .like I did when I had a booth at trade shows.

Michael:

What about Thursday?

Marty:

Thursday is interesting.  Part of the event is set aside for what the OTC calls its Energy Education Institute. The Institute conducts two events – one for high school students and another for all grade level teachers.

This student workshop is hands-on and not only a lot of fun for the students, but incredibly educational. Students learn how to interpret data, a fundamental skill for engineers.

The Institute also welcomes science teachers. Attendees receive hands-on training in presentations by qualified facilitators, and tour the OTC hall. Teachers then receive a variety of free instructional materials to take back to their classrooms.

Michael:

 Thanks Marty that was a good summary I hope to make it to OTC.

Marty Stetzer:

If you there on Monday I look forward to seeing you there.

If you're interested go to www.otc.org, and start planning your trip – before you head to the event. Pick out the vendors booths and papers you might want to see or hear. The breakfasts and the luncheons are extra money, but you'll hear firsthand what's going on from industry veterans.

This is the 50th anniversary of the OTC and with the crude prices recovered to the $70 level You could see offshore and deepwater activity come alive over the next couple years.

If you are new to oil and gas, be sure to check out our free Oil-101 series on how the industry works at www.ektinteractive.com

Thanks for listening and thanks for your help Michael.

Sponsors:

EKT Interactive Oil and Gas Podcast Network

Oil 101 A Free Online Introduction to the Oil and Gas Industry

The post Prepare For The OTC With Marty Stetzer appeared first on EKT Interactive.

Thanks for listening to the EKT Interactive Oil and Gas Podcast Network.

What is the 2018 World Oil Drilling Activity Outlook for the US and Internationally?

This Drill Down episode gives a 21 minute executive summary of the annual World Oil breakfast. It was held in Houston on January 26th and covered their outlook for global drilling activity.  We welcome back Joe Perino to this podcast.

We do not cover the extensive amount of data presented at the breakfast.  You can access the details in the February 2018 issue of World Oil, or on their website.

We do present updates since the World Oil breakfast, and some of the recent business changes that can affect the data. The so-called words behind the music!

Topics and Time Stamps:

[00:10]   Introduction to the 2018 World Oil Drilling Activity forecast

[01:50]   Joe Perino summarizes the Key Drivers of Drilling Activity

[04:55]   Marty Stetzer discusses the Positive US Regulatory Outlook

[06:50]   Marty Stetzer summarizes the Global E&P CAPEX Outlook

[09:00]   Joe Perino presents the US state-by-state drilling forecast

[13:05]   Joe Perino presents the International country-by-country drilling forecast

[17:10]   Summary and where to learn more

Relevant Links:

World Oil follow-up A 62-minute webcast

Innovations in the Digital Oilfield with Joe Perino

Related Episodes:

HPI Downstream Investment Outlook 2018 – Executive Summary Podcast

Oil & Gas Journal 2018 Global Outlook Executive Summary Podcast

EKTi Oil-101 Introduction to Upstream

EKTi Oil-101 Introduction to Midstream

About the Experts

Marty Stetzer

In parallel with his 25-year energy career, Marty has over 15 years experience in providing custom digital training programs to a variety of oil and gas technical audiences – like EKT Interactive Oil 101.

Marty has been a consultant to U.S. and international oil and gas
companies since 1986, including 13 years with PriceWaterhouseCoopers.

He has 18 years management experience with Schlumberger, Superior Oil-Mobil, Wilson Industries and Exxon.

Marty has worked with numerous national and international oil and gas company managements to help improve business performance across upstream, midstream and downstream operations.

Like many of the team, Marty is active in the Society of Petroleum Engineers and often presents at industry forums.

Joe Perino

Joe brings over 40 years of experience in upstream, midstream and downstream. He has worked in engineering, maintenance, sales, marketing and business development, and technical, IT and management consulting.

Joe started his career with Diamond Shamrock as a process engineer, then spend 20 years with process automation and supply chain technology suppliers Emerson, Honeywell and i2, before joining the consulting ranks with IBM, Logica North America, KBC Advanced Technologies, and Schlumberger Business Consulting.

Joe was involved early on with the Digital Oilfield concept and has consulted on production efficiency and effectiveness improvements for KOC, Pemex, Petrobras, Sonangol and Statoil, and was a member of the Shell Smart Fields and Chevron iFields teams while at Schlumberger.

Today he focuses on using technology to improve the business as Digital Oilfield (DO) has evolved into technology-enabled Operational Excellence and now sees IoT, Big Data and Analytics as the next step in the evolution in DO. He works with several firms as a content contributor, in business development and as a podcaster on EKT Interactive, Inc. Joe holds an B.S. in Chemical Engineering from the University of Notre Dame and an M.S. in Finance from the University of Houston. He has also completed executive education at Northwestern's Kellogg School of Management and Harvard Business School. He is active in the AIChE, ISA, COS, NOIA, OESI, SPE and Oil Council.

Links:

HPI Downstream Outlook Webinar

Hydrocarbon Processing

3 Publications Oil and Gas Industry Execs Count On

World Oil

Oil & Gas Journal

Fuel Fix Article 

Sponsors:

EKT Interactive Oil and Gas Podcast Network

Oil 101 A Free Online Introduction to the Oil and Gas Industry

The post Executive Summary 2018 World Oil Global Drilling Activity Outlook with Joe Perino appeared first on EKT Interactive.

Thanks for listening to the EKT Interactive Oil and Gas Podcast Network.

What is the 2018 Outlook for Global Crude Supply Demand Balance and Crude Price?

This Drill Down episode gives an executive summary of the February 2nd,2018 Oil & Gas Journal ( The Journal ) webcast discussing the global crude supply-demand outlook, and the impact on crude price. We welcome back Joe Perino to this podcast.

We do not cover the extensive amount of data presented in the webcast. You can access all the details in the January 2018 issue of the Journal, or on their website.

We do present updates to the Journal team observations since the webcast, and some of the business drivers behind the data -The so-called words behind the music!

 

Topics and Time Stamps:

Introduction to the Journal webcast

[01:35] Joe Perino summarizes the Crude Supply outlook, presented by Bob Tippee

[05:00] Joe Perino discusses the potential risks to Crude Supply

[07:25] Marty Stetzer summarizes Market Demand, presented by Dr. Conglin Xu

[09:17] Marty Stetzer presents the Crude Price and Brent WTI Spread history

[11:20] Marty Stetzer presents the 2018 Crude Price Forecast and Models

[13:10] Summary and updates since the webcast – Price Volatility continues

 

Relevant Links:

Oil & Gas Journal Webcast

Innovations in the Digital Oilfield with Joe Perino

 

Related Episodes:

HPI Downstream Investment Outlook 2018 – Executive Summary

EKTi Oil 101: Introduction to Upstream Oil & Gas

 

About the Experts

Marty Stetzer

In parallel with his 25-year energy career, Marty has over 15 years experience in providing custom digital training programs to a variety of oil and gas technical audiences like EKT Interactive Oil 101.

Marty has been a consultant to U.S. and international oil and gas
companies since 1986, including 13 years with PriceWaterhouseCoopers.

He has 18 years management experience with Schlumberger, Superior Oil-Mobil, Wilson Industries and Exxon.

Marty has worked with numerous national and international oil and gas company managements to help improve business performance across upstream, midstream and downstream operations.

Like many of the team, Marty is active in the Society of Petroleum Engineers and often presents at industry forums.

Joe Perino

Joe brings over 40 years of experience in upstream, midstream and downstream. He has worked in engineering, maintenance, sales, marketing and business development, and technical, IT and management consulting.

Joe started his career with Diamond Shamrock as a process engineer, then spend 20 years with process automation and supply chain technology suppliers Emerson, Honeywell and i2, before joining the consulting ranks with IBM, Logica North America, KBC Advanced Technologies, and Schlumberger Business Consulting.

Joe was involved early on with the Digital Oilfield concept and has consulted on production efficiency and effectiveness improvements for KOC, Pemex, Petrobras, Sonangol and Statoil, and was a member of the Shell Smart Fields and Chevron iFields teams while at Schlumberger.

Today he focuses on using technology to improve the business as Digital Oilfield (DO) has evolved into technology-enabled Operational Excellence and now sees IoT, Big Data and Analytics as the next step in the evolution in DO. He works with several firms as a content contributor, in business development and as a podcaster on EKT Interactive, Inc. Joe holds an B.S. in Chemical Engineering from the University of Notre Dame and an M.S. in Finance from the University of Houston. He has also completed executive education at Northwestern's Kellogg School of Management and Harvard Business School. He is active in the AIChE, ISA, COS, NOIA, OESI, SPE and Oil Council.

 

Links:

HPI Downstream Outlook Webinar

Hydrocarbon Processing

3 Publications Oil and Gas Industry Execs Count On

World Oil

Oil & Gas Journal

Fuel Fix Article 

 

Sponsors:

EKT Interactive Oil and Gas Podcast Network

Oil 101 A Free Online Introduction to the Oil and Gas Industry

 

Transcript:

Marty: 

Hi everyone.  Welcome to the Drill Down with Marty Stetzer. This podcast is part of our EKTI oil and gas learning network, brought to you by Oil 101, our free introduction on how the oil and gas industry works.

Today you'll hear our sixteen-minute executive summary of the recent Oil & Gas Journal Forecast and Review webinar, held on February 2nd, 2018. Two editors presented and eighty-minute global outlook for crude oil supply, market demand, and a crude price forecast for 2018.

Note that our Downstream Outlook podcast summary from Hydrocarbon Processing is already published on our website.

Today I'm again joined by Joe Perino, a long-time friend and industry veteran. You've heard Joe's popular Sound-off series on our website.

Marty: Joe – Welcome.

Joe: Thanks Marty. Nice to be here.

Marty: 

Note that we will not try to cover or repeat the extensive amount of data presented in the webinar in our podcast today.  You can access all the details in the January 2108 issue of the Journal, or on their website.

We will present updates to the Journal team observations since February 2nd, and some of the business drivers behind the data… The so-called words behind the music!

Joe, why don't you start off

Joe: 

A key webinar presenter was Bob Tippee, now the Chief Editor of the Oil and Gas Journal, and a widely recognized senior industry expert.

In Bob's opinion, supply management by both OPEC and Russia has been crucial to balancing the oil market in 2017. It's really extraordinary in terms of the degree of compliance and the duration of the production agreements, which have already been extended through 2018.

OPEC's historic cartel activity usually dies of its own success. As prices rise, the supply restraint usually gives way to cheating – but not so far. Furthermore, the market knows that there is plenty of crude supply at least through 2020.

Another factor in the supply equation is the explosive level of US shale oil activity. Historically, when OPEC would restrain production, the supply response had to go through a long and costly exploration cycle. Now, US producers respond to higher prices as quickly as it takes to find a rig, drill, and complete a well. As we saw in 2017, when prices neared the $50 per barrel mark, US drilling came back strong. And this is not to mention the backlog of several thousand DUCs (drilled but not completed wells) still remaining.

Today, a big question is whether tight oil production can keep growing. Many experts think the production growth is surprising – but it’s been real.  The US rig count grew 43% in 2017, with the Permian Basin leading US production. Some current Permian wells are economic at pretty low prices. By the way, that's also led to Texas being the number seven oil producer in the world, with somewhere over 3 million barrels.

However, at some point there will be a diminishing supply of what are called sweet spots. Even though continuous shale reservoirs contain enormous amounts of hydrocarbon, some parts may not be as responsive to horizontal drilling and hydraulic fracturing as others.

Be that as it may, on February 6th (just a few days after the webinar!) the EIA (Energy Information Administration) increased their forecast of US crude oil production in 2018 and 2019 to over 11 million barrels a day far exceeding the production rates of both Saudi Arabia and Russia.

As knowledge about the reservoir and know-how about drilling and completion grows, shale supply grows.  Operators are now leveraging that knowledge with new analytical methods using big data concepts. To illustrate, Bob presented a Chesapeake Energy presentation which listed a series of analytic applications that producers now use to increase performance of these technical wells. Supply is now more of a function of knowledge and know-how, and less of geological luck, than it used to be.

See our website for numerous podcasts on the way Big Data and the Internet of Things revolution are changing the upstream industry.

Going back to the Middle East Production compliance is all the more remarkable given new geopolitical challenges. Persian Gulf producers are always in some sort of antagonism, but it’s higher now than it has ever been in a long time — especially between Saudi Arabia and Iran.

Though the Iranian protests seem to have subsided, they could have drastically affected Iranian production.

Additionally, we saw Iraq trying to disrupt pipeline exports from Northern Kurdistan.

Bob highlighted additional potential downside to the crude supply in other production hotspots, including:

• The dire situation in Venezuela with an evolving dictatorship and a collapsed economy.  This has caused serious deterioration in crude oil production.  Venezuela has been unable to stop a six-year-long production decline with the country only producing 1.8 million barrels per day in 2018, down from 2.9 million barrels per day in 2014 – a 28-year low, and down nearly 300,000 barrels per day from 2016 alone. Financial difficulties further limit production, as access to vital diluent imports is needed to produce more heavy bitumen.
• A second hotspot is in Nigeria, where militancy could continue. In 2016, Nigerian production fell 600,000 barrels a day because of coordinated and sophisticated attacks on oil installations, led by the Niger-Delta Avenger militants.
• A third hotspot is Libya's production of approximately 1 million barrels per day, up from a low of 200,000 barrels per day in 2014. But it continues to yoyo with closing of ports and pipeline disruptions as the civil war continues.

Loss of production in any one of these areas will also affect crude price. Remember, for crude oil, like other commodities, small swings in supply demand lead to large swings in price.

Now back to Marty for demand and crude price observations from the webinar….

Marty:

Thanks Joe.

Next I'll cover the presentation made by Dr. Conglin Xu, economics editor of the Oil & Gas Journal since 2012.

She first elaborated on the global oil balance.  Here, her analysis indicated the oil market is tightening as inventories are reduced and consumption is growing.

According to Dr. Xu, global crude oil demand growth is expected to be very strong, because it's so closely related to economic growth. According to the World Bank, the global economy is experiencing a very broad-based cyclical upturn, which is expected to continue over the next couple of years.

But it is a mixed outlook when you look across regions

For example, in the OECD in Europe and Japan economic growth has slowed, but the US is likely to be an exception, thanks to recent government policies.

The primary oil demand growth will come from emerging markets, as this sector continues to experience population growth, industrialization, and urbanization.  High commodity prices also help, because many emerging economies are also commodity exporters.  High commodity prices ultimately improve the funds available for consumption of refined products.

Finally, a word about China China’s oil demand is important to the global oil market supply demand picture. Though oil demand is growing, the Journal experts expect the growth rate to be half in 2018 versus 2017. As many of you may know, the Chinese government is also promoting electric cars that will further restrict the use of diesel and gasoline.

Turning to crude price 2017 reminded us all how volatile the oil market could be. As OPEC implemented their production cuts, the Brent crude price started the year at the mid-$50's per barrel. The US shale producers then profited from the OPEC strategy – with very aggressive capital spending projects, which increased their production rapidly to high levels.  Then the oil price plummeted again to mid-$40's per barrel.

Another important pricing impact in 2017 was the widening of the spread between Brent and WTI. This occurred because Brent went up in response to the global drawdown in supply from the major oil producers, while WTI in the US was depressed because US output continued to outgrow US demand, especially for the light sweet crudes coming from shale plays.

The spread that was $1.72 per barrel in 2016 became almost $4.00 per barrel in 2017.  This wide differential boosted US crude exports to Asia and Europe upsetting some OPEC producers. The Journal experts estimate that US crude oil exports in 2017 reached a record high of 1 million barrels per day. Product exports also exceeded 5 million barrels per day. That’s a very healthy increase, and US exports are expected to continue to surge given high oil production.   

In early 2018, price started moving off in the right direction – with Brent climbing to about $70 per barrel. This was a result of production cut success, some imbalances in the market, and severe decline in stocks.

Dr Xu then covered three major factors used in her short-term 2018 crude price forecast.

The first is the futures market which showed an expectation of between $40 to $85 per barrel at the end of January a wide range.

Because of this, she uses a different model with sophisticated regression techniques to determine her short-term price forecast. Her model uses real oil price which is deflated by the CPI not the futures market data. This real oil price forecast has proven to be more accurate in the past.

Her model runs showed that the oil price should continue to climb through most of 2018, reaching a peak of about $80 per barrel. Her model forecasts some decline in the fourth quarter – that honestly was very tough to explain!

Finally, Dr. Xu looks at the drivers of crude price fluctuations. Her work is based on a methodology developed by Dr. Lutz Kilian, professor of economics at University of Michigan. He has followed oil markets for over 10 years and his model decomposes three items, each with a different impact on oil prices:

• The recent strong crude price performance comes primarily from supply side considerations.
• It's interesting that the demand side is not as important.
• Finally, speculation in the future market actually has a negative effect on current oil price. Seems that the traders act differently when prices are headed up or headed down.

You can learn more from his numerous papers on the topic.

It looks like Dr. Kilian's models could be correct In just the ten days since the February 2nd webinar, crude prices have dropped over 10% to below $60 a barrel for WTI we think primarily as a result of increased US production from shale plays and a new inventory build.  We will need to wait and see if Dr. Xu's forecast of rising crude prices in 2018 turns out to be true

So there you have it

The 2018 crude supply outlook thanks to Bob Tippee, and demand and crude price covered by Dr. Conglin Xu during the Oil and Gas Journal 2018 Outlook webcast of February 2nd. We've just scratched the surface there are many other interesting topics covered in the webinar and the Q and A.

We hope you've enjoyed this executive summary, and we're really happy to have Joe's input during this session.  Joe, anything to add before we wrap up?

Joe:

Yes, Marty. Right now the oil price is being held up artificially by production restraint, but as you pointed out, with the global economy rebounding and oil demand growing, it will be interesting to see when the deal between OPEC, Russia, and others breaks down and the spigots re-open in the race to capture market share and larger revenues If we think volatility is a $10 to $15 per barrel variation, wait and see. All of this bodes for future volatility far ahead of today's relative calm and moderately rising prices.

Marty:

So the more things change, the more they stay the same in the volatile crude oil world

Thanks again, Joe.

Drop me a note to let us know if this podcast was helpful. And again, the Downstream Outlook from Hydrocarbon Processing is already posted on our website.

To learn more about how the oil and gas industry works, be sure to check out our new and improved Oil 101 modules at www.ektinteractive.com.

We now offer a mobile-ready version of our popular 10-part Oil 101 series – and a cost-effective design for your corporate learning systems.  Let us know if you're interested, and thanks again for listening.

The post Executive Summary – Oil & Gas Journal 2018 upstream outlook with Joe Perino appeared first on EKT Interactive.

Thanks for listening to the EKT Interactive Oil and Gas Podcast Network.

Going boldly where others have already gone!

In this episode in our series on the Internet of Things (IoT) in oil and gas, we speak with Jim Claunch, VP of Operational Excellence for Development and Production at Statoil.

Jim will be on the keynote panel at the upcoming IoT in Oil and Gas Conference in Houston.  This podcast gives you some great insight into the quality of speakers this conference has managed to assemble.

Use discount code EKTI10 to get 10% off your registration fee!

 

IoT in Oil and Gas Podcast Series

IoT in Oil and Gas Conference with the Energy Conference Network

Preview of the IoT in Oil and Gas Conference keynote panel with Joe Perino

IoT in Oil and Gas – Digital Oilfield, Now vs Then with Former Chevron and Caterpillar CIO Randy Krotowski

IoT in Oil and Gas – IT/OT Convergence with Statoil VP Jim Claunch

 

About Jim Claunch

Jim Claunch is currently Vice President of Operational Excellence for Development and Production USA/Mexico in Statoil. He joined Statoil in 2009 as Vice President of Global Business Services in the Houston office and subsequently held VP of HR positions in Norway and in Houston. He has over 25 years of experience in the energy sector including 14 years of international experience serving in various financial and shared services roles. Prior to joining Statoil, Jim's roles included:

• Managing Director of Growth Capital Partner's Energy Group in the Merchant Bank's Houston office.
• CFO and CIO of Power Well Services (PWS), a global oilfield services  company controlled by First Reserve. PWS was put together via six acquisitions and later sold to Expro International Group PLC.
• Sr. Vice President of Shared Services and IT at Intercontinental Hotels Group.
• Vice President of Global Shared Services for Halliburton Energy Group, where he had global responsibility for accounting, communications, finance, HR, procurement, quality and IT functions.

Mr. Claunch is a CPA and holds a Bachelor of Arts degree in Business administration from Hardin-Simmons University.

 

IoT in Oil and Gas Conference

Whether you're a major operator, contractor or technology solution provider, this is your chance to learn from insightful case studies and benchmark against industry best practice. You will also have plenty of opportunities to exchange ideas and network with peers to pursue commercial opportunities.

Results from a new survey by Deloitte forecasts 2017 as a year of recovery for commodity prices, with companies expected to gradually ramp up operational activity as demand increases. As a result, IoT technologies will play a crucial role in meeting productivity and cost reduction targets.

And the 3rd Annual IoT in Oil and Gas conference promises to be an even more comprehensive forum for IoT innovation. New developments and frameworks will be explored as companies focus on improving efficiency.

The event will explore how organizations can overcome emerging and existing challenges such as cyber security, lack of standardization, legacy installed bases, and liability of current technologies.

 

Show Notes

[1:00] Going boldly where others have already gone!

[4:00] Operators vs services providers

[4:45] How Statoil is getting internal stakeholders on board – Big data starts with small data

[10:00] A major transformation

[10:20] Getting filed production team on board – how dashboards change work processes in the field

[12:45] IT/OT convergence

[15:30] The line needs to own it

[16:45] Learning from others, information sharing in the industry

[18:50] Last thoughts – Importance of getting senior leadership the 30,000 ft view.

 

Relevant Links

IoT in Oil and Gas Conference

Energy Conference Network

 

The post IoT in Oil and Gas – IT/OT Convergence with Jim Claunch, VP at Statoil appeared first on EKT Interactive.

Thanks for listening to the EKT Interactive Oil and Gas Podcast Network.

What Does 2018 Hold for The Downstream?

In this episode of Drill Down, we give you an executive summary of recent Hydrocarbon Processing (HPI) webcast for the downstream industry forecast. We welcome back Joe Perino to the podcast as we discuss the HPI outlook for downstream investments over the next 20 years.

We highlight Hydrocarbon Processing (HPI) industry in three sectors:

• Refining
• Petrochemicals and
• Gas processing and the LNG industry

 

Topics and Time Stamps:

[00:25]  Three publications we recommend

[01:20]  Summary the HPI Downstream Outlook Webinar

[03:05]  Joe Perino discusses Refining & Petrochemical outlook

[07:45]  Marty Stetzer discusses LNG outlook

[12:00]  Final wrap up – Trends looking favorable

 

Relevant Links:

Drill Down Oil and Gas Podcast: Downstream, Refining and Trends

Big Data and Analytics in Refining

 

Related Episodes:

Sound Off – Changing US Refining Landscape

Oil 101 – Introduction to Downstream

 

About the Experts

Marty Stetzer

 

In parallel with his 25-year energy career, Marty has over 15 years experience in providing custom digital training programs to a variety of oil and gas technical audiences – like EKT Interactive Oil 101.

Marty has been a consultant to U.S. and international oil and gas
companies since 1986, including 13 years with PriceWaterhouseCoopers.

He has 18 years management experience with Schlumberger, Superior Oil-Mobil, Wilson Industries and Exxon.

Marty has worked with numerous national and international oil and gas company managements to help improve business performance across upstream, midstream and downstream operations.

Like many of the team, Marty is active in the Society of Petroleum Engineers and often presents at industry forums.

Joe Perino

Joe brings over 40 years of experience in upstream, midstream and downstream. He has worked in engineering, maintenance, sales, marketing and business development, and technical, IT and management consulting.

Joe started his career with Diamond Shamrock as a process engineer, then spend 20 years with process automation and supply chain technology suppliers Emerson, Honeywell and i2, before joining the consulting ranks with IBM, Logica North America, KBC Advanced Technologies, and Schlumberger Business Consulting.

Joe was involved early on with the Digital Oilfield concept and has consulted on production efficiency and effectiveness improvements for KOC, Pemex, Petrobras, Sonangol and Statoil, and was a member of the Shell Smart Fields and Chevron iFields teams while at Schlumberger.

Today he focuses on using technology to improve the business as Digital Oilfield (DO) has evolved into technology-enabled Operational Excellence and now sees IoT, Big Data and Analytics as the next step in the evolution in DO. He works with several firms as a content contributor, in business development and as a podcaster on EKT Interactive, Inc. Joe holds an B.S. in Chemical Engineering from the University of Notre Dame and an M.S. in Finance from the University of Houston. He has also completed executive education at Northwestern's Kellogg School of Management and Harvard Business School. He is active in the AIChE, ISA, COS, NOIA, OESI, SPE and Oil Council.

 

Links:

HPI Downstream Outlook Webinar

Hydrocarbon Processing

3 Publications Oil and Gas Industry Execs Count On

World Oil

Oil & Gas Journal

Fuel Fix Article 

 

Sponsors:

EKT Interactive Oil and Gas Podcast Network

Oil 101 A Free Online Introduction to the Oil and Gas Industry

 

Transcript:

Marty:

Hi everyone! Hope the 2018 is starting off well for you. Welcome to the drill down with Marty Stetzer. This podcast as part of our EKTi Oil and Gas Learning Network, and brought to you by oil 101. Our free introduction to oil and gas.

We often recommend that our community listeners follow three major publications to stay in touch with the industry opportunities and challenges. They are Hydrocarbon Processing or HPI, world oil, and the Oil and Gas Journal. Each publication has a different focus and each one is doing it annual outlook for 2018. As the first in a series today, we’re presenting a 13 minute executive summary of a recent one hour HPI webcast on the positive future outlook for downstream investments. Today I’m joined by Joe Perrin, a longtime friend and industry veteran. You’ve heard Joe’s sound off series on our Website we’re happy to have his help today as we present the global opportunities in the downstream over the next 20 years.

Marty: Joe welcome back.

Joe: Thanks, Marty, It’s really good to be here.

Marty:

Here’s a quick summary of where we’re headed. In December 2017 webcast, two HPI editors presented the State of the global downstream processing industry and the major trends moving into 2018 and beyond. They covered construction and investment in three sectors: refining, petrochemicals, and gas processing and the LNG industry.

HPI has a respected survey that now tracks almost two trillion dollars and seventeen hundred downstream projects through 2030. These numbers represent projects that are either announced or in some phase of the project planning, engineering, or construction cycle.

In summary, Asia Pacific dominates the global trend in total active projects led by projects in China and India. Then the Close’s contenders are the Middle East followed by the United States. In 2018, HPI sees downstream spending at approximately 361 billion dollars. About 46 percent in petrochemicals, 36 percent in refining, and the balance in gas processing and LNG. In the near term capital spending should increase over 2017 with major refining projects in Asia and the Middle East. There is also a massive petrochemical projects spending in Asia and the Middle East and the U.S.. as you’ll hear from Joe. Gas processing and LNG investments are planned for the U.S., Canada, Australia, and gutter.

Let me turn it over to Joe to cover the refining and petrochemical presentation made by Lee Nichols, an editor and associate publisher of HPI.

Joe!

Joe:

Thanks again, Marty! In refining. Some background is first needed.

Depending on the forecast. Below oil demand is expected to increase from 95 million barrels per day of 2015 to somewhere between 99 and 102 to 103 million barrels a day by 2021 or 2022. Within that same timeframe HPI is tracking about seven to eight million barrels a day of new refining capacity that should begin operation.

Now over the past year..well that is 2017, some 70 new refining projects were announced. The majority of these projects about 60 will be located in the Asia Pacific and Middle East regions. There is an increase also in the integration of refining with petrochemical operations, especially in grassroots projects. There are also numerous investments to increase energy efficiency, crude oil processing flexibility, sulfur reduction, and a number of other initiatives basically making refining a more complex. China is continuing to build their refining capacity. Some will be the largest in the world. We’re also seeing a big new trend in China and that is integration of refining and petrochemical operations. I should add also that the major refiners in China are squeezing out these small teapot refiners who have been disrupting the market with non-specs quality products.

Now for petrochemicals, HP I see strong growth in the petrochemical sector to the rest of the decade. In 2017, 50 percent of the announced downstream projects were petrochemicals. HPI now attracts more than 300 and 30 new petrochemical projects announced over the past three years. And they represent well over 100 billion dollars in total capital expenditures in Asia Pacific, the U.S., and the Middle East. Those three regions combined equal about 70 percent of the total active petrochemical projects, roughly 325 projects. There is some concern about overcapacity in the U.S.. However, the growing demand in Asia-Pacific will be met by billions of dollars of new petrochemical capacity one way or the other. About half of the Asia-Pacific petrochemical products are in China. To satisfy demand, China will add nearly 15 million tons a year of ethylene capacity by 2025. The majority of the plants will also produce polyethylene.

There’s also a big surge in demand for polypropylene. To satisfy the polypropylene demand, China has also invested heavily in the construction of unconventional processing units like: coal-to-olefins, methanol-to-olefins, and propane dehydrogenation plants.

The U.S. petrochemical industry is in the midst of one of the largest expansions ever to occur in North America. There will be an incredible amount of ethylene and ethylene derivatives capacity. Most of that product will flow to Central and South America. Continuing the trend that refining has of exporting refined products to Central and South America due to their limited refining capacity. The total announced capital investments have eclipsed $135 billion; in products like capacity expansions, upgrades, plant restarts, and greenfield facilities. A very large percentage of that U.S. investment will be made by foreign firms such as Saudi Armco partnering with Exxon, here in the Gulf Coast. The leader of the Middle East for both refining and petrochemicals will continue to be of course Saudi Arabia. They intend to nearly triple their production of petrochemicals from about 12 million tons per year corruptly 34 million tonnes a year by 2030.

Marty:

Thanks for that summary, Joe.

Now, into the LNG story. It was presented by Adrian Bloom, an executive editor of HPI and the editor of gas processing magazine. According to HP data, current global LNG production capacity is just under 340 million metric tons per year by contrast 2016 LNG demand was measured at only 265 million metric tons. This obviously shows a large oversupply imbalance.

Adrian then covered each major supply point that was considering expansions. Some of the expansions that are on record are equivalent to a new LNG train coming on stream every two or three months over the four year period from 2016 to 2020. For example, in 2017, the U.S. alone announced over 40 LNG export terminal projects. This accounts for an investment of about $200 billion dollars. By 2020, HPI expects about 72 million tons per year of LNG capacity to begin operation in the U.S.

A January 21st, 2018 fuel fix article cited that the U.S. could become a net exporter of natural gas in 2018. This would be for the first time since 1957. Now due to an increased sale of LNG and natural gas to Mexico. Additionally, the U.S. is already shipping LNG to at least 20 foreign markets. This is thanks to the booming U.S. natural gas production unleashed by the so-called shale revolution.

Canada has also announced over two dozen LNG export terminal projects at a cost of more than $170 billion dollars. However only a fraction of that amount could be built. There have been project delays due to stringent government regulations, a lot of public opposition, infrastructure constraints, and the current global glut in LNG supply.

Australia is currently the world’s second largest exporter of LNG after gutter; thanks to the startup of three new large export projects in Queensland. Australia could overtake Gater as the world’s largest exporter of LNG by 2019. However, in July 2017, Australia established a law that allowed the government to limit LNG exports if the domestic power market is not adequately supplied. That law will remain in effect through 2022. If the Export Limitation is ever triggered, it could potentially put an estimated $50 billion dollars of LNG investments at risk.

Finally, Gutter is also planning Brownfield LNG expansions that could shut down Australia’s ambition to become the number one LNG supplier. Gutter produces about 86 million metric tons per year of LNG today, but the planned expansions could take its output to 100 million metric tons. New types of projects are being considered to take advantage of the stranded gas reserves offshore Australia and elsewhere such as small scale, floating, LNG vessels, and small scale development of onshore LNG terminals. These would be built from modular components and they offer a much quicker time to market.

So there you have it.

Thanks to HPI Annual Investment survey there is a very positive outlook for capital investment and related job opportunities in refining petrochemicals and LNG.

We’re really happy to have Joe’s input and help as we presented this executive summary.

Joe, anything to add before we wrap up?

Joe:

Yes, Marty as you pointed out earlier things are looking up for the HPI. We have relatively low natural gas prices here in North America, which is fueling petrochemical investment and LNG plant construction. We have a relatively healthy oil price now in the low 60s. We have surging petrochemical investment not only in the Middle East and in Asia Pacific but we see it right here in our own backyard in the Gulf Coast from the likes of Phillips 66, LyondellBasell, and Exxonmobil. But not only here but for the first time up north in your old hometown of Pittsford where Shell is building in ethylene cracker. So things have indeed changed and things are looking up certainly in the near term.

Marty:

If you would like the link to the actual HPI webcast, just drop me a note.

We were also let you know when our 2018 upstream outlook from world oil is scheduled.

To learn more about the breadth of the oil and gas industry, be sure to check out our new and improved oil 101 modules at www.EKTinteractive.com.

We’re now offering a mobile ready version of our popular 10 part oil 101 series and a cost effective design for your corporate Elam’s system.

 

Let us know if you’re interested and thanks again for listening.

 

The post Executive Summary – HPI Outlook for Downstream Investment with Joe Perino appeared first on EKT Interactive.

Thanks for listening to the EKT Interactive Oil and Gas Podcast Network.

What is IoT in the context of Oil and Gas?

In this episode of Drill Down, we speak with EKT Interactive Sr. Associate and host of the Sound Off podcast Joe Perino. Joe will be moderating the keynote panel at the upcoming IoT in Oil and Gas Conference in Houston.

Joe offers some insight on whats to come including:

• How is IoT empowering oil and gas to do more with less
• How do we evaluate the benefits and setbacks during IoT implementations
• What is the C-Suite perspective on the IoT value proposition

Joe also introduces the keynote panel, which will include:

• Jim Claunch
• Richard Ward
• Randy Krotowski
• Dr. Mike Biddle
• Linda Salinas

 

IoT in Oil and Gas Podcast Series

IoT in Oil and Gas Conference with the Energy Conference Network

Preview of the IoT in Oil and Gas Conference keynote panel with Joe Perino

IoT in Oil and Gas – Digital Oilfield, Now vs Then with Former Chevron and Caterpillar CIO Randy Krotowski

IoT in Oil and Gas – IT/OT Convergence with Statoil VP Jim Claunch

 

IoT in Oil and Gas Conference

Whether you're a major operator, contractor or technology solution provider, this is your chance to learn from insightful case studies and benchmark against industry best practice. You will also have plenty of opportunities to exchange ideas and network with peers to pursue commercial opportunities.

Results from a new survey by Deloitte forecasts 2017 as a year of recovery for commodity prices, with companies expected to gradually ramp up operational activity as demand increases. As a result, IoT technologies will play a crucial role in meeting productivity and cost reduction targets.

And the 3rd Annual IoT in Oil and Gas conference promises to be an even more comprehensive forum for IoT innovation. New developments and frameworks will be explored as companies focus on improving efficiency.

The event will explore how organizations can overcome emerging and existing challenges such as cyber security, lack of standardization, legacy installed bases, and liability of current technologies.

 

About Joe Perino

Joe brings over 40 years of experience in upstream, midstream and downstream. He has worked in engineering, maintenance, sales, marketing and business development, and technical, IT and management consulting.

Joe started his career with Diamond Shamrock as a process engineer, then spend 20 years with process automation and supply chain technology suppliers Emerson, Honeywell and i2, before joining the consulting ranks with IBM, Logica North America, KBC Advanced Technologies, and Schlumberger Business Consulting.

Joe was involved early on with the Digital Oilfield concept and has consulted on production efficiency and effectiveness improvements for KOC, Pemex, Petrobras, Sonangol and Statoil, and was a member of the Shell Smart Fields and Chevron iFields teams while at Schlumberger.

Today he focuses on using technology to improve the business as Digital Oilfield (DO) has evolved into technology-enabled Operational Excellence and now sees IoT, Big Data and Analytics as the next step in the evolution in DO. He works with several firms as a content contributor, in business development and as a podcaster on EKT Interactive, Inc. Joe holds an B.S. in Chemical Engineering from the University of Notre Dame and an M.S. in Finance from the University of Houston. He has also completed executive education at Northwestern's Kellogg School of Management and Harvard Business School. He is active in the AIChE, ISA, COS, NOIA, OESI, SPE and Oil Council.

 

Relevant Links

IoT in Oil and Gas Conference

Energy Conference Network

The post Preview of the IoT in Oil and Gas Conference Keynote Panel with Joe Perino appeared first on EKT Interactive.

Thanks for listening to the EKT Interactive Oil and Gas Podcast Network.

In this episode in our series on the Internet of Things (IoT) in oil and gas, we speak with Randy Krotowski, former CIO at Chevron and Caterpillar and a lifelong digital advocate.

Randy will be on the keynote panel at the upcoming IoT in Oil and Gas Conference in Houston.  This podcast gives you some great insight into the quality of speakers this conference has managed to assemble.

Use discount code EKTI10 to get 10% off your registration fee!

 

IoT in Oil and Gas Podcast Series

IoT in Oil and Gas Conference with the Energy Conference Network

Preview of the IoT in Oil and Gas Conference keynote panel with Joe Perino

IoT in Oil and Gas – Digital Oilfield, Now vs Then with Former Chevron and Caterpillar CIO Randy Krotowski

IoT in Oil and Gas – IT/OT Convergence with Statoil VP Jim Claunch

 

About Randy Krotowski – Former CIO at Chevron and Caterpillar

Randy Krotowski has 35 of experience at the intersection of business and technology, including serving as CIO for two Fortune 100 companies, Chevron and Caterpillar. He now works as an advisor with C3 IoT, helping companies apply IoT and AI to transform their products and operations.

As CIO for Chevron Global Upstream, he drove a multiyear digital oilfield transformation, accelerating Chevron's use of big data and analytics to improve oil and gas exploration, drilling, reservoir management and production operations. As CIO for Caterpillar, Krotowski delivered Caterpillar's first generation of predictive technology solutions for mine and construction sites.

Earlier in his career, Krotowski spent 15 years in engineering and operations Chevron's U.S., Canadian and Latin American business units.

Randy holds an MBA from Golden Gate University and a BASc in Chemical Engineering from the University of Toronto.

 

IoT in Oil and Gas Conference

Whether you're a major operator, contractor or technology solution provider, this is your chance to learn from insightful case studies and benchmark against industry best practice. You will also have plenty of opportunities to exchange ideas and network with peers to pursue commercial opportunities.

Results from a new survey by Deloitte forecasts 2017 as a year of recovery for commodity prices, with companies expected to gradually ramp up operational activity as demand increases. As a result, IoT technologies will play a crucial role in meeting productivity and cost reduction targets.

And the 3rd Annual IoT in Oil and Gas conference promises to be an even more comprehensive forum for IoT innovation. New developments and frameworks will be explored as companies focus on improving efficiency.

The event will explore how organizations can overcome emerging and existing challenges such as cyber security, lack of standardization, legacy installed bases, and liability of current technologies.

 

Show Notes

[2:00] Randy’s background as a career digital advocate

[3:30] Oil and gas vs. Manufacturing – a unique perspective

[5:45] How oil and gas’ geographic spread affects technology implementation

[8:30] Digital oilfield – now vs then (then is the early 2,000’s)

[12:00] How the business organizational model affects IT roll out

[13:15] Silicon Valley perspective

[17:15] Last thoughts – Encourage operators to think about how new platforms can change operations

 

Relevant Links

IoT in Oil and Gas Conference

Energy Conference Network

Oil 101 – A Free Introduction to Oil and Gas

 

 

The post IoT in Oil and Gas – Digital Oilfield, Now vs. Then with former Chevron and Caterpillar CIO Randy Krotowski appeared first on EKT Interactive.

Thanks for listening to the EKT Interactive Oil and Gas Podcast Network.

A Conversation with Melissa Zerber of the Energy Conference Network

We had a chance to talk with Melissa Zerber, ECN’s project director for the upcoming IoT in Oil and Gas Conference.

Melissa offers a quick run down of what you can expect from this timely event.

ECN has also offered our listeners a special discount!  Use the code EKTI10 at checkout for 10% off the registration price!

 

IoT in Oil and Gas Podcast Series

IoT in Oil and Gas Conference with the Energy Conference Network

Preview of the IoT in Oil and Gas Conference keynote panel with Joe Perino

IoT in Oil and Gas – Digital Oilfield, Now vs Then with Former Chevron and Caterpillar CIO Randy Krotowski

IoT in Oil and Gas – IT/OT Convergence with Statoil VP Jim Claunch

 

IoT in Oil and Gas Conference

Whether you're a major operator, contractor or technology solution provider, this is your chance to learn from insightful case studies and benchmark against industry best practice. You will also have plenty of opportunities to exchange ideas and network with peers to pursue commercial opportunities.

Results from a new survey by Deloitte forecast 2017 as a year of recovery for commodity prices, with companies expected to gradually ramp up operational activity as demand increases. As a result, IoT technologies will play a crucial role in meeting productivity and cost reduction targets.

And the 3rd Annual IoT in Oil and Gas conference promises to be an even more comprehensive forum for IoT innovation. New developments and frameworks will be explored as companies focus on improving efficiency.

The event will explore how organizations can overcome emerging and existing challenges such as cyber security, lack of standardization, legacy installed bases, and liability of current technologies.

 

About ECN – Energy Conference Network

The Energy Conference Network was established in response to a growing disenchantment with traditional conferences.

Why settle for events that have too many sales pitches, make it difficult to meet the right people and focus on shallow industry topics?

Conferences need to be better than this. And that's where our team comes in. We're committed to in-depth research for our conference programs, and ensuring you have the best experience possible in the lead-up, onsite and post-event.

Whether it is resource efficiency, supply chain optimization, technology implementation or production enhancement, our conferences have the relevant content you're looking for.

The Energy Conference Network will organize and execute the most timely, insightful and respected conferences in the energy sector, providing executives with the edge they need to overcome the challenges of today's operating environment.

 

About Melisa Zerber

Melissa Zerber brings twelve years of experience to her role at the Energy Conference Network. After college, Melissa began her career in the entertainment industry, first as an intern and ultimately working her way to a paid position as artist manager.

In 2006 she made the move to television where she served in various production roles, including Associate Producer for an Emmy award winning daytime program. In 2008, Melissa worked as Conference Coordinator and Project Manager for a legal services start-up, and in 2010 she became the Director of Sales and Special Events for a large non-profit events center, regularly hosting groups in excess of 7000 guests.

 

Show Notes

[1:00] About the IoT in Oil and Gas Conference

[1:35] The keynote speakers

[2:45] Where to learn more

[3:10] Discount code!

 

Relevant Links

IoT in Oil and Gas Conference

Energy Conference Network

 

The post IoT in Oil and Gas Conference by Energy Conference Network appeared first on EKT Interactive.