Mining value from e-connectivity

The oil and gas industry stands on the threshold of a new way of doing business

The oil and gas industry stands on the threshold of a new way of doing business. Over the last 12-18 months, a dramatic shift in understanding has taken place within the industry; fully embracing the notion that information technologies (IT) must play more than just a supportive role in the enterprise plan. Industry leaders now see IT as a foundational, enabling agent that is opening up the possibility of entirely new business models, relationships, and work flows.

Fundamental to the business role that IT now plays is global networking - the ability to communicate and send data from one location to another, regardless of where the sender and receiver reside around the globe, including offshore, and regardless of the data's bandwidth requirement. Of course, such capability must be reasonably secure, highly reliable worldwide, flexible in design, and cost effective. Although this seems to be a tall order, such functionality exists today.

Global reach

To be valuable, data must be processed and analyzed by various experts and partners, and the quicker and easier it can be shared among them, the faster optimum decisions translate into return on investment. Real-time data exchange, however, does come with a price - it has security implications. How do we know, for sure, with whom we are sharing and communicating on the other end of a digital network?

Yet, today's market is demanding a level of productivity that can only be delivered by a truly digital enterprise. Thus, prudent companies transforming themselves into this type of player are making certain that not only are its own IT systems, digital networks, and employees protected with state-of-art-security technologies, but also its partners and service providers. For example, in the very near future anyone wishing to partner with or provide services to a major oil company will have to have a common, high-grade security system in place.

Various types of networks are being established to provide verifiable security and a global reach, such as virtual private networks, which use private channels over public networks, and secure private networks, which provide dedicated, nonpublic connectivity. Extending these systems may include satellite service to provide connectivity to remote locations, and, increasingly, wireless connections for data transmission to and from handheld devices. Multiple parties, from multiple companies and multiple locations can choose to digitally connect with one another to receive field data in real time or to share information office to office, with privacy intact.

Adaptation of the Public Key Infrastructure (PKI) and Secure Sockets Layer (SSL) technologies are being used to provide cutting-edge information security solutions. Smart card technologies are a perfect example of this. Smart cards look much like a credit card and photo identification combined, but include dual microchip technology for storing vital statistics. They serve as a single, integrated tool to verify entry onto a network or email system, into a building, or onto a vessel, rig, or platform, and can store digital signatures, which are far more secure than traditional signatures. In this way, only approved personnel can enter given systems or locations, and log-in/log-out can be tracked. Event records are automatically stored.

After establishing a secure, global reach, any network that an operating or service company might choose to establish or join must be reliable, fast, flexible and cost-effective. Now that broadband IP (Internet Protocol) transmissions are possible, the technological roadblock has been overcome.

It is now possible to reliably transmit even the largest of oilfield files via a secure global network, so the remaining questions are: is the network available when needed, and is it affordable? This is only achievable with a network and related infrastructure dedicated to the oilfield, and one that serves a sufficiently large customer base to be able to provide connection services on a pay-per-usage basis.

Changing landscape

Setting aside the current technological capabilities of IT and network connectivity, it is the business changes enabled by these technologies that truly define their value. Suddenly able to consider real-time data transmission from offshore and remote locations, as well as the possibility of secure, network-based multiparty collaborations, industry leaders have already begun implementing entirely new business models and relationships. And who knows what new ways of doing business will emerge over the next decade.

Initiatives worth mentioning include Oil Partnering Networks recently established in the North Sea and Gulf of Mexico regions, and offsite data archiving, among others. Oil Partnering Networks are secure, managed, closed TCP/IP (broadband) networks primarily used for critical oilfield operations, engineering reports, and E&P partner reporting. They aim to facilitate secure collaboration among the partners, and thus enhance service efficiency and eliminate redundancies, saving time and expense for everyone involved. Organizations typically involved include oil companies, drilling contractors, engineering contractors, logistics service companies and IT bureau and service companies. All types of secure, digital office-to-field connections are enabled through one central connectivity hub that physically replaces numerous data connection points with one, eliminating the added costs and possible security breaches inherent to the previous multiconnection environment.

Offsite data archives, managed by experts, represent a newly emerging business model facilitated by secure network connectivity, as well. As network security issues are resolved to operators' satisfaction, the notion of reducing the IT overhead required with in-house data archiving and management is attractive. If the data asset is going to travel via a global network anyway, the idea that someone else might be responsible for its long-term health and usability is not so far fetched. Under this plan, the data owner's monetary outlay might be on a pay-per-access basis.

Like these examples, other ways of doing business that significantly improve the bottom line will continue to emerge as e-connectivity and the industry's use of it matures. It is no longer business as usual. Real, real-time is unlocking new doors.

Xavier Flinois
Schlumberger Network Solutions

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