Putting the IoT in drilling

The Internet of Things could help transform drilling rig technology, but it isn’t a panacea, warns a Transocean official. Karen Boman reports.

Gutierrez

Though a lagging indicator, the lack of innovation in offshore drilling rig technology can be measured by the number of drilling technology patents filed. From 1945 to 2012, 36,279 offshore drilling technology patents were filed. In the year 2014 alone, the telecommunications industry filed 37,277 patents.

Plenty of technology innovation has occurred downhole. But above the hole, the offshore drilling contractor community has used the same technology for years, said Jose A. Gutierrez, director of Transocean’s technology and innovation group, during a recent presentation at the Internet of Things (IoT) Oil and Gas Conference in Houston.

Six years ago, the company initiated a major innovation effort to remain a technology leader in the industry, Gutierrez tells OE. Transocean’s technology and innovation group has focused over the past three years on how IoT can enhance Transocean’s drilling rig fleet. Transocean’s digital transformation program aims to improve operational efficiency, increase financial efficiency, and boost operating integrity.

Gutierrez attributes the lack of technology innovation to the high barrier of entry. A few product and service providers monopolize most of the technology offering, and until now they had little incentive to improve products their customers would buy anyway. “If we have an idea with a strong value proposition and sufficient funding, it still has low probability of success due to these high barriers to entry,” Gutierrez says.

In the past, the oil and gas industry was wealthy enough that it could just throw money at a problem, Gutierrez says, so the drilling industry didn’t have to worry about innovating existing performance. But, this has changed in the ongoing oil price downturn. Now, drilling rig contractors are being forced to be innovative, creating a renaissance in offshore drilling rig technology.

Transocean is using IoT technology to make decisions based on data, instead of relying solely on worker experience. IoT is allowing the company to capture data, which is then cleaned and modeled by data scientists to gather information. This information enables Transocean to perform predictive maintenance.

More than 50% of the innovation and technology group’s portfolio is comprised of IoT-enabling technologies. While the technology is super-relevant, it is also not a panacea, says Gutierrez, adding that companies should first find the problem they’re trying to solve, and what is relevant.

“Saying IoT can solve a business problem is like saying Microsoft Word or Excel can do the same thing – you can do great things with these programs, if you know how to use them, if they’re deployed right, and what you are writing and modeling. But they’re just programs. You might be trying to solve the wrong problem, or optimizing a machine when you should design a new one,” Gutierrez says.

“Automating chaos is not a good idea,” he adds.

The implementation of IoT technology is not about cutting human workers completely out of the loop. Until today, the oil and gas industry has been very human-centric, but measuring the reliability of a human is impossible.

“It was like the 1950s, when people fixed their own cars,” Gutierrez says. In the 21st century, people take their cars to shops for repairs because the technology powering their vehicles is so complicated.

Using IoT allows firms to retain knowledge as workers leave, giving the next generation reliable information, so they’re not making the same mistakes over the years, Gutierrez says.

The IoT technology is nothing new, and has been used in the processing, automotive, aerospace, biomedical, and downstream side of oil and gas. “These tools have existed for years, but were too expensive and difficult to access in the past,” Gutierrez says.

As companies catch IoT fever, Gutierrez anticipates a bubble forming for IoT technology – similar to the 2001 Internet bubble – and new IoT companies fighting for market share. He also believes that the IoT community is overemphasizing the important of data. Data is nothing – it’s information that’s valuable.

“The oil and gas industry will face a challenge in understanding what IoT can do for them,” says Gutierrez. “Whoever deciphers the value of taking decisions based on data to codify knowledge will be the winner.”

Transocean is following an open innovation model, and partnering with many small and large companies, as well as universities, Gutierrez says. Transocean is also leveraging learnings from the heavy industrial, military and aerospace industries in its pursuit of technological innovation. The company also has relationships with the Oak Ridge and Argonne national labs.