$224 million Aberdeen oil technology center opens

A new, US$224 million (£180 million) center aimed at making Aberdeen a center of oil and gas technology has been launched today.

The launch of The Oil & Gas Technology Centre (OGTC), which is to include a number of thematic "solutions centers," included the announcement that a multi-million pound field life extension and decommissioning research and development facility is to be created, in partnership between the OGTC, Robert Gordon University and the University of Aberdeen. 

Funding for the center is coming from a $311 million Aberdeen City Region Deal fund. But, cash for the OGTC will need to be match funded - with cash or work in kind - by the industry, as part of the funding deal. 

Executives leading the center have set goals including doubling UK oil industry technology exports, halving the cost of drilling wells, reducing maintenance costs and solving issues like corrosion under insulation monitoring and management and the high cost and complexity of well plugging and abandonment. Small pools/marginal fields and digital technologies are also within the scope of the OGTC, whose focus is being led by the guidance of the Technology Leadership Board, an industry-regulator joint body.  

Initial projects will focus on rigless plugging and abandonment, improving the speed and performance of drilling wells, augmented decision making to drill more efficiently, asset integrity, said Colette Cohen, a former Centrica senior exec, and now the OGTC's CEO.

Within asset integrity, the focus will particularly be around corrosion under insulation and vessel entry. "We want zero vessel entry by 2025," said Cohen. "We are looking for technology to identify and detect corrosion under insulation without going into vessels. Corrosion right now is a hugely time consuming activity."

The North Sea's so-called small pools - some 210 small fields that are currently uneconomic to develop - will also come under focus. 

Sir Ian Wood, whose land mark 2014 Maximizing Economic Recovery report drove the creation of the Oil and Gas Authority and who has been key to the formation of the OGTC, said: "The truth is, we haven't developed new technology new technology for a number of years." He said at $100/bbl, it was too easy, the industry was doing what it had done in the past. The industry is also conservative, he says. There is a frustration in the supply chain that's keen to differentiate itself but in many cases is unable to get new technology deployed." If new technology isn't developed the industry will struggle to unlock the 10-20 billion boe remaining in the basin, he said. "This [the OGTC] will only succeed with operators, the supply chain and others involved," he added.

"The challenges are still out there, technology and innovation can unlock some opportunities and sustainability," said Deirdre Michie, CEO of industry body Oil & Gas UK. "The industry is building on a legacy we can tap in to. There is more to do, but when people start to see the benefit it will build momentum."

Sir Ian also pointed out that for the last 20 years, the oil and gas industry had less than 1% of the national research and development spending budget. The OGTC would look to help increase that in the long-term, with a view to developing next generation solutions. 

Cohen says the body has aligned goals with other technology focused organizations, including the Industry Technology Facilitator, the Oil and Gas Innovation Centre and the National Subsea Research Initiative. 

Cohen says the center has already screened hundreds of opportunities and many projects are underway. These include a field trial in 2017, which could create a step change in how wells are plugged and abandoned with the potential to save hundreds of millions of pounds.

Sir Ian added: "I'm never sure about events like this. There is a lot of expectation on the center. We do realize the challenges. We have got a good team. With your help we will deliver." 

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