In Focus: The power of digital collaboration

While project and technology alliances have always been important in oil and gas, these collaboration relationships have often been challenging along the value chain. Fortunately they are transforming into tighter partnerships than ever seen before.

Companies still dealing with low oil prices and digitalisation are seizing the opportunity to share the burden of costs and benefits from new insights. Extracting maximum value, however, requires the close integration of many different systems and technologies that would have traditionally been separate – such as automation, power and telecoms.

Why now? In his report UKCS Maximizing Recovery published in 2014, Sir Ian Wood recommended that industry must commit to and recognise that much better collaboration is needed to increase the opportunities and value for all parties. While industry recognises the need for this, the journey for commercial and culturally competitive organisations to improve collaboration is not without its challenges.

ABB’s response to this has been to roll out a global network of Collaborative Operations Centres to connect people across organisations in a new way. Using a cross-industry agnostic digital platform it gives operators access to systems, solutions and servicesthat help them know more, do more, do better, together with us. Analytics ensure improvement areas are identified, categorised and prioritised so operators at site, working with our experts, can take actions to ensure peak performance.

The digital challenge

For years, companies have been collecting data; some say they are now drowning in it. Unfortunately, the information has been concentrated in silos so it was not  always reaching the person who could make best use of it. Before the price crash there was little incentive to address this. In addition, affordable and secure ways of sharing data had not been sufficiently developed.

Digitalisation – in its current form – addresses both challenges by bringing together previously segregated information, analysing it, directing it and prioritising the issues operators need to address. It also makes it easier than ever to harness, in a timely manner, the expertise of employees and external partners scattered throughout the world, maximising the chances of finding the most optimal solution.

This evolving cultural shift with more intense collaboration between operators, major contractors and suppliers is bringing energy, insight and innovation along with different business models. These new ways of working will be fundamental to securing the industry’s future and competitiveness. Already we have shown that these solutions can cut up to 30% in capital and operational expenditures (capex and opex) while accelerating projects by 25%, without sacrificing safety and security.

Successful collaboration

It is our belief that market-changing innovation can only be realised through collaboration between operators and suppliers. For example, in 2013 a subsea joint industry programme was formed to put a sealed-off ‘factory’ on the seabed, working 24/7 for decades without intervention. Last  November we successfully tested a full-scale prototype of a subsea variable speed drive.

While oil and gas companies have historically worked closely together with suppliers to bring projects online and solve challenges, the potential return from such collaboration has never been greater than today.

Admittedly, there has been some hesitation in the upstream sector about moving the integrity of a plant to a collaboration centre, as the operators want to ensure that the integrity of a plant is on site. But having access to a collaboration centre means more expertise and insight into data can be brought quickly to the table when issues arise.

One of the very key elements of collaboration is data security. The collaboration centre has to offer strong physical security and cybersecurity on the data highway. As mentioned, better collaboration can break down the silos or barriers between different levels in an organisation, and different disciplines, as well as along the value chain.

Digitalisation can help provide better collaboration, for improved productivity and lower capex and opex costs throughout the value chain, with closer dialogue between operators and suppliers to drive work process improvement.

This year we have seen a significant increase in collaboration across the industry – for example, ABB has announced a number of alliances. These partnerships vary in type, each existing for different purposes from project and technology to full value chain integration.

On the project collaboration front, NextDecade will be partnering with us to automate and electrify the second wave of US LNG, to bring online an LNG export facility on the Brownsville Ship Channel in South Texas. We are working with Aker BP on the Valhall Flank West unmanned wellhead platform, aimed at $35/b break-even and 25% reduction in execution time. Likewise, we announced a global agreement with SABIC for technology exchange. Collaboration also makes sense for future, remote and automated intelligent oil and gas operations. An excellent example is Ormen Lange, where we have partnered with Norske Shell since the 1990s.

The key to successful alliances is commitment from day one, with crystal-clear expectations and an effective structure. It is more than signing a piece of paper. Done correctly, collaboration is proven to cut cost, schedule and risk.