By Sarah Kent and Christopher M. Matthews
Xukai Shen, a geophysicist working at BP Plc, had a hunch he
could solve a riddle that had vexed the company: whether there was
a lot of oil hidden beneath a salt dome 7,000 feet underwater in
the Gulf of Mexico. So he asked to use the company's supercomputer
exclusively for two weeks to check it out.
Using an algorithm, the 33-year-old with a Stanford PhD
harnessed the computer's massive power last year to produce a
clearer seismic image of what lay beneath. The result: a
potentially massive oil find. With a clearer picture of the area,
BP estimated 200 million barrels of crude lay hidden in the
Atlantis oil field, a region the company had been plumbing for
decades.
"Basically we found a field within a field," said Ahmed Hashmi,
BP's head of technology for exploration and production, during a
recent tour of the company's Houston supercomputer, as the machine
hummed nearby.
BP is now in love with beefy computer power -- and it's far from
the only one in the oil patch. Italy's Eni SpA has built a
computing facility the size of a soccer field outside of Milan,
crediting its help in all its most recent oil and gas discoveries.
France's Total SA recently upgraded its Pangea supercomputer,
nearly tripling its computing power.
While big oil companies were early adapters of supercomputers,
some have poured hundreds of millions into upgrades, and now
possess some of the most powerful commercially owned computers on
the planet.
The efforts are part of a larger digital arms race among energy
companies, which are embracing technology in newfound ways to
produce fossil fuels more cheaply and efficiently. Earlier
mechanical advances enabling the boom in U.S. oil and gas
production and lowering prices have added to the pressure on
companies to innovate even further.
The computers are costly, but can reduce the oil exploration
process by months and save companies tens of millions of dollars by
avoiding misplaced wells. To harness their potential, the companies
are increasingly seeking to compete with Silicon Valley firms for
top data and computer scientists.
"We're going all in," said Bernard Looney, BP's head of
exploration and production. "We're only scratching the surface
today of what's possible."
BP is in the middle of a five-year, $100 million investment in
its Houston supercomputer. It's built a 15,000-square-foot room in
a 3-story, flood-proof building to house the titan, which currently
takes up about 50% of the space and has the computing power of
around 50,000 iPhone 7s.
BP claimed it was the most powerful commercial research computer
in the world in December. Within a month, however, it was overtaken
by Eni's supercomputer. BP said it has room to expand its computer
further.
Not everyone can take BP's build-your-own approach. Like
high-cost deepwater oil projects, in-house supercomputing remains
largely the domain of only the world's biggest oil companies. But
smaller players are finding creative ways to take advantage of
technological advances.
Devon Energy Corp., one of the largest U.S. shale oil producers,
is putting its data in the cloud so it can use the virtual
computing power Microsoft Corp.
"It costs me hundreds of thousands of dollars versus tens of
millions," said Benjamin Williams, Devon's chief information
officer. "You have to decide, am I going to use this giant capacity
enough to justify the investment versus the premium I may pay from
a cloud provider."
Mr. Williams said many high performance computing centers are
idle 80% of the time, while Devon only pays for supercomputing when
it needs it. Devon has a small innovation lab in its Oklahoma City
headquarters, where its computer and data scientists can experiment
on high-end computers and virtual reality platforms. The company
developed three-dimensional visualization tools there that its
geologists use to "get inside" Devon's oil reservoirs.
Exxon Mobil Corp., the world's biggest non-state-backed oil
company, also outsources its demand for computing power to analyze
seismic data and map the rocks it's planning to drill. Even BP uses
outside computers for regular seismic analysis, reserving its giant
facility in Texas for cutting-edge research.
How much the digital revolution really changes the century-old
oil and gas industry remains to be seen. Some executives and
analysts are already warning that companies have unrealistic
expectations about the speed of adoption.
John Gibson, who heads the digital innovation team at energy
investment bank Tudor Pickering Holt & Co, said most energy
companies gutted their research and development funding during the
past commodity price crashes, and hasn't recovered.
"Most of the horizontal drilling and fracking techniques we're
using today were from research dollars that were spent in the early
90s," Mr. Gibson said. "There is basic research that the industry
needs and we rely on academia for it right now."
BP says it's already reaping the benefits of experiments with
advanced technology.
In Alaska, the company said it crunched 40 years of data on its
operations, weather patterns and pipeline corrosion and found ways
to maintain its 1,300 miles of pipelines in the state more
efficiently by reducing on-site inspections.
The physical inspections -- as many as 100,000 locations a year
-- only found issues 2.5% of the time, and were difficult to
perform in a state where temperatures can get so cold that workers
can only be in the elements for minutes at a time. With the
analysis, BP has managed to reduce inspections 25% and better
predict corrosion, Mr. Looney said.
Write to Sarah Kent at sarah.kent@wsj.com and Christopher M.
Matthews at christopher.matthews@wsj.com
(END) Dow Jones Newswires
April 10, 2018 07:14 ET (11:14 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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