This week’s Pipeliners Podcast episode features first-time guest Matt Harrison of WellAware discussing how the COVID-19 pandemic, environmental social governance (ESG), and asset integrity have been impacted by the use of technology.
In this episode, you will learn about how the pandemic accelerated the rate of technology adoption to support remote connectivity in pipeline operations, the dramatic shift to cloud management of data, the role of pipeline control rooms in data optimization, the tremendous opportunity for operators to improve their asset integrity programs, how to use technology to support mission-critical ESG initiative, and more topics.
Episode Show Notes, Links, and Insider Terms
- Matt Harrison is the Co-Founder, CEO, member of the Board of Directors of WellAware. Connect with Matt on LinkedIn.
- WellAware empowers organizations to be efficient, safe, and sustainable by streaming mission-critical data to employees, so they can remotely monitor and control physical assets.
- ESG (Environmental, Social, and Governance) refers to the sustainability movement in oil and gas to continue operating safely, in compliance, and in a responsible manner to do no harm while achieving business objectives.
- SCADA (Supervisory Control and Data Acquisition) is a system of software and technology that allows pipeliners to control processes locally or at remote location. SCADA breaks down into two key functions: supervisory control and data acquisition. Included is managing the field, communication, and control room technology components that send and receive valuable data, allowing users to respond to the data.
- Edge Communications is a method of building out the architecture for structured communication from edge devices in the field to a host server using connectivity to transmit the data.
- LTE (Long-Term Evolution) is the cellular wireless technology bridging today’s 3G to 4G to 5G.
- CatM also known as LTE Cat-M1 is Category 1 of the LTE-M IoT network technology.
- LTE (Long-Term Evolution) is the cellular wireless technology bridging today’s 3G to 4G to 5G.
- Cathodic Protection (CP) is a technique used to control the corrosion of a metal surface by making it the cathode of an electrochemical cell.
- RMUs (Remote Monitoring Units) are designed to monitor Cathodic Protection rectifiers. RMUs are used to monitor CP levels at rectifiers and test points along pipelines.
- Data rate is the average number of bits (bitrate), characters, or symbols (baudrate), referenced as bits per second (bit/s) and bytes per second (B/s).
- Data lakes store data in its native format without being subjected to size or formatting constraints. Cloud-based data storage enables operators to store a significant amount of data in their lakes at a lower rate.
- DMZ (Demilitarized Zone) is a physical or logical subnetwork that contains and exposes an organization’s external-facing services to an untrusted network, usually a larger network such as the Internet.
- IoT (Internet of Things) is a system of interrelated computing devices, mechanical and digital machines, objects, animals or people that are provided with unique identifiers and the ability to transfer data over a network without requiring human-to-human or human-to-computer interaction.
- ML (Machine Learning) is an application of AI (artificial intelligence) that provides systems the ability to automatically learn and improve from experience without being explicitly programmed.
- Management By Exception model is a business model or management strategy where managers only intervene in standard processes when there is a significant deviation from planned outcomes.
- Moore’s Law is an accepted observation in the semiconductor industry introduced by former Intel CEO Gordon Moore. According to the observation, the number of transistors in an integrated circuit doubles every two years, leading to advanced technological improvements and innovation.
Full Episode Transcript
Russel Treat: Welcome to the Pipeliners Podcast, episode 177, sponsored by P.I. Confluence, providing software and implementation expertise for pipeline program governance applied to operations, Pipeline Safety Management, and compliance, using process management software to connect program to implementation. Find out more about P.I. Confluence at piconfluence.com.
Announcer: The Pipeliners Podcast, where professionals, Bubba geeks, and industry insiders share their knowledge and experience about technology, projects, and pipeline operations. Now your host, Russel Treat.
Russel: Thanks for listening to the Pipeliners Podcast. I appreciate you taking the time and to show that appreciation, we give away a customized YETI tumbler to one listener each episode. This week, our winner is Kirsten Winters with Burns McDonnell. Congratulations, Kirsten. Your YETI is on its way. To learn how you can win this prize, stick around till the end of the episode.
This week, Matt Harrison joins us to talk about how the pandemic, environmental safety governance, and asset integrity are being impacted by the use of technology. Matt, welcome to the Pipeliners Podcast.
Matt Harrison: Hey. It’s great to be here with you, Russel. Thanks for having us.
Russel: If you would, tell the listeners a little about yourself, your background, what you do, and how you got into it.
Matt: You bet. My name’s Matt Harrison. I’m the founder and CEO of a company called WellAware who monitors things. We find really hard to reach machines and give them a voice and try to interpret what they’re saying.
I’m a West Texas product, like as far west as you can get. I grew up in El Paso, went to school at Texas A&M, which I know you’ll be proud of, and got an electrical engineering degree there.
I’m actually a technologist by training through most of my career, and then, about a decade ago, got involved in oil and gas — really with the view to see what we could do to help improve operational efficiency and the role that technology can play. It’s been a heck of a run and a heck of a ride.
Russel: I expect this conversation to get a little geeky because we play in the same domain. That’s awesome. I like geeky. I think the listeners do, too. I asked you to come on. What I want to do is talk about technology.
While you’re certainly a guy that knows about instrumentation and control and all that kind of stuff, some of the interesting things is how technology is beginning to shift and how IT-type disciplines are starting to find their way into the field to add value. That’s what I wanted to have the conversation about.
I think probably the first thing to ask — as we record this it’s late March of 2021 — we’re very hopeful that we’re getting to the end of the pandemic season. How have you seen the pandemic impact how people are using technology?
Matt: Profoundly. When you did the calendar reset, it just really quickly flags in my mind about a year ago, I asked my eighth-grade daughter, “Hey, where do you want to go for spring break?” She said, “Let’s go to New York, dad.”
We went to New York and it was like Indiana Jones. We saw the last Broadway play before it was shut down. We visited the 9/11 Memorial before it was shut down. It is hard to imagine that was just a year ago, but, boy what a trip down memory lane you’ve triggered for me.
Technology is going to play a significant role going forward. I think if anything, the very difficult pandemic that we’ve all endured has created more opportunity for technology.
We’re seeing the need increase for asset management, putting remote monitoring on more things out there because humans have been locked down for the last year. They haven’t gotten out. They haven’t had the chance to do some of the preventative maintenance they might have done. That’s on remote assets. That’s in facilities. That’s even within the supply chains of our customer base. We think that some of that will return back to normal, but some of it won’t. Just like the virtual work we’re all doing now.
Russel: Yeah, that’s exactly where I was going to go, Matt. I haven’t made a trip for business now in over 15 months. I probably have not done that since before I was a teenager. I haven’t been on an airplane since December of 2019. In 2019, I flew 75,000 miles.
It becomes super-reliant on screen-share meetings. Everybody has got way more comfortable with having a camera on their screen-share than not. Certainly, there’s been a lot of change there.
The other thing that’s really interesting. I did an article that I updated several times last year about COVID in the control room and the things people were doing, including they had controllers that were getting set up to operate from their house so that they didn’t have to go into the control room, which is just completely unprecedented. Nobody would have ever thought to do that prior to COVID.
Matt: You’re bringing up some great points. We’re humans. This concept that we have to bifurcate our lives and we can do video chats when we’re talking, or we can work on our smartphones and have complete access to anything anywhere we are, and then we have to walk into the work environment and take a step backward a decade or two decades in terms of time, that continuum is not going to continue to exist a lot longer.
Just like we’ve all become dramatically connected, whether you like it or not, with smartphones, machines are about to go through that same evolution over the next decade or two.
Russel: What do you mean by that? What does that mean for machines to get connected? That sounds like a Skynet to me. What is that really?
Matt: The reality is the industry, particularly oil and gas and other heavy industries, have been doing some connectivity of machines for a long time. We do that under the SCADA telemetry kind of bucket.
I think what we’ll see going forward is just a substantial increase in capability functionality with intelligent edge devices now being placed out in the field — the tremendous investment that’s been made around 4G LTE, Cat-1, Cat-M, just this connectivity layer, the 5G that’s coming.
Russel: Particularly the stuff that gets you the last mile and the gets you there with a lot of connectivity.
Matt: The last mile. Whether it’s cellular or whether it’s satellite, I’m hearing that almost every place on the face of the earth will have one gigabit per second connectivity. Let that sink in. By 2025.
Russel: It’s crazy.
Matt: By 2025. Just the race to space, and, of course, the cellular folks aren’t going to give up the ground that they have. That’s just the connectivity layer. Then you think about what’s happening in terms of cloud storage, and you’ve got these massive investments coming.
Look, I talked to some of the largest operators six, seven years ago when we were starting the company and thinking through this and said, “Hey look, you know, you can leverage the cloud. The cloud is a great place. It’s secure. It’s infinite storage.”
I had multiple people say, “Listen, there’s no way we’ll have operational data in the cloud.” Those companies all have a lot of operational data in the cloud today. When you get it in the cloud…
Russel: We were talking about the pandemic earlier, if you look at people that needed to evolve their systems very quickly in order to get a new infrastructure in place, the cloud made a huge amount of sense because the speed of deployment in the cloud is a fraction of the speed of deployment, just the lead time, is a big deal.
Matt: It’s exactly right.
Russel: Not to mention getting the phone company out, and the Internet company out, and getting all those physical demarcations established, and just being able to when I get on my computer and I get myself a Google Cloud, next thing you know I could build an infrastructure to run a Fortune 500 company. It’s crazy.
Matt: The cloud offers lots of benefits, security being one of them, backup redundancy being another. The one you mentioned earlier around control rooms is once your data is in the cloud, where you consume data, whether it be on your mobile, or at your home through a secure connection, or in the office, you have a lot more flexibility on how you do this.
The remote worker is absolutely going to continue to endorse more and more cloud architectures going forward. The pandemic has truly had a profound impact on our lives. I think they’ll stay, and also on our jobs.
Russel: Fundamentally what the pandemic has done related to technology is it’s forced us to accelerate our adoption by 5 to 10 years.
Matt: You’re right.
Russel: Maybe more.
Matt: You’re right.
Russel: There’s a lot of things we’re doing now that we just view as normal, and it’s causing us to ask a whole bunch of questions we weren’t even considering a year and a half ago.
Matt: You’re spot on with that. I’ve seen a lot of examples of that, both inside of energy with technology, but in my own personal life as well.
Russel: Sure. I’m sure all of us have. You think about who would have thought that I’m going to have my kid going to school from the kitchen table? We would never even have contemplated that.
We’d have thought that was completely ridiculous, and now, people have done it. It’s not. There’s certainly some big problems with it, but it also opens up a lot of possibilities as well.
It’s interesting. I run a training company and one of the things that we’re looking at is that when we do online training, it means we could train anybody anywhere on the planet.
It’s no longer the issues about getting people to the classroom, and the visas, and the travel. Now, the issue is, how do you get everybody on the same time zone? It’s the new problem.
Matt: You’re right in stating the acceleration that’s happening. The 5 to 10 year acceleration is probably very true. I also want to echo what you said. Part of me is sick about it, because we’re humans at the end of the day. We still need a lot of this human interaction that unfortunately has been constrained over the last year.
Russel: I went to have dinner with some very good friends that I have been in oil and gas business with for decades, and I hadn’t seen any of these guys other than on a Zoom call forever. We had a blast. It was a load of fun. I miss that kind of stuff.
Matt: It makes you appreciate the relationships and people for sure.
Russel: Exactly. The whole video call thing, it’s great for getting things done, it’s horrible for building new relationships, right?
Russel: It’s the challenge. Let’s shift. Let’s talk about asset integrity. What’s going on with asset integrity and how people are applying technology for that benefit?
Matt: You bet. I know a lot of your listeners are folks attached to the midstream or pipeline industry. We’re fortunate to have that industry. It makes oil and gas a much safer place, takes a lot of vehicles off the road, and eliminates spills, and does some amazing things for the industry.
Now that we’ve got that infrastructure in place, we need to protect it. We’re finding that there’s a tremendous opportunity to help our pipeline customers improve their asset integrity programs.
What I’m talking about there, Russel, is primarily in the areas of protecting the inside of the pipe from things that could corrode the pipe, or scale inside the pipe, or even hydrates, and then the ability to protect the outside of the pipe, which is traditionally done with cathodic protection.
Chemical programs are used to treat the inside of the pipes and cathodic protection has historically been used to protect the outside of the pipelines. The challenge is neither one of those technologies work very well, and so we see a tremendous opportunity in technology to come in and offer a better solution.
Russel: Let’s break that down a little bit and be specific. You talk about cathodic protection. I think most people in the pipeline world understand what cathodic protection is and how it’s done. They’re probably familiar with the idea of using telemetry to bring data back so it can be analyzed. How is technology going to change that fundamentally?
Matt: You picked the one of the two that we’re just getting into. We’re a little further along on the chemical side, but I’ll talk about what we’re thinking in how we’re planning on applying some technology in that space around cathodic. My understanding at this point is the industry does have some remote monitoring of RMUs, rectifiers, but that’s just looking at the general status of that rectifier.
The challenge I see and the opportunity I see — or we see here at WellAware, and we’d love to work with anyone that wants to further explore it with us — is I’d like to help find a way to get very cost-effective monitoring of test points, test stations, in real-time.
If you think about that and let your mind wander a little bit about how powerful it would be if you knew the impressed current that the rectifier’s putting on the pipeline, and you were able to take a real-time collection of every test station, geo-synchronized down to the millisecond, you would have a true reading of the health of your pipeline. You could do so much with that.
Russel: If you could add to that some other types of sensors — I’m going to get groundwater content, I’m going to get electrical field from overhead power lines and things like that, and I’m going to bring all that into a model, and then I can apply some machine analysis, some advanced algorithms to all that — I can see in real-time what’s going on with my cathodic protection envelope.
Matt: You’re two steps ahead of me, which is not surprising, but you’re 100 percent right. The first major innovation is, every test station — or let’s call it every critical test station — needs to be monitored. I’m not going to submit or believe that we can’t figure out a way, as an industry, to do that cost-effectively.
If there’s one thing technology can do is dramatically reduce the cost of things and dramatically increase our visibility into them, which is what you just shared. The second major opportunity that I see is instead of just having remote monitoring of rectifiers, we should have remote control of rectifiers.
This speaks exactly to what you were talking about, Russel. Why is it that our rectifiers are not changing the current that they’re impressing upon the pipeline based on test station readings? Here’s one of our theses, we believe that a lot of oil and gas, a lot of pipeline companies, are wasting millions of dollars a year just in electricity.
They’re overshooting what they need impressing current across their pipeline, just because they don’t know. It’s pretty blind. The way that closed-circuit surveys are done, they’re so manual, you can’t get a good reading, so you plan for what? Worst-case scenario. Worst-case scenario costs a lot more money than it should.
If you had remote monitoring at test stations in real-time, and you had the ability for rectifiers to be optimized for the exact amount of current that needs to be applied in the condition that that pipeline is in that day, not that quarter, not that year, boy, we believe there’s a lot of potential savings there for our customers.
Those are the areas we’re going to explore further.
Russel: I don’t know enough about the science. I had a guy on the podcast by the name of Bob Franco, who literally wrote the book on cathodic protection. The guy’s absolutely brilliant, and he has the ability to make it simple enough that I can understand it. [laughs] What I would say is you’re probably right.
The other thing that would also be appealing is, if an operator had a situation where they needed to bump the current because they had some coating loss or something like that, or they were able to identify they were getting coating loss because of a change in the way the rectifiers and test stations are behaving. That would have some real value as well. Not only is there the operating value, there’s probably an integrity value there as well.
Matt: 100 percent. You mentioned one great example. We’ve talked to a number of customers who are dealing with over line power current impressing upon their pipeline leakage. They don’t know about it until they get a quarterly survey done out there of a test station that’s close enough, or maybe they can see it in a rectifier.
Russel: They generally know about it. What they don’t know about it is they don’t know about change.
Matt: That’s a good point.
Russel: They don’t know about change. They don’t know that somebody did a dig or some other pipeline in the right-of-way modified their cathodic settings. All those things affect the other. It’s really about being able to see the change. That’s the real value from an integrity standpoint.
Matt: See the change and to see it in a lot more real-time scenario, not monthly, not quarterly.
Russel: And in a lot more resolution so that you have a much better ability to understand the impact of that change.
Matt: That’s what technology should do. That’s what technology should bring to the table.
Russel: You talked about chemical. You said you’ve done more with that. Tell me a little bit about what you’re doing in that domain and how technology is impacting that.
Matt: This is an immediate opportunity for any pipeline operator out there that wants to save a tremendous amount of money. Here’s the reality. Despite everybody having great intentions around chemical management programs helping to protect the inside of pipelines, the results are very poor. I can explain that because we have tremendous amount of data that tells us that.
What’s working is the diagnosis of the problem. Is the problem corrosion? Is the problem scale — if you’re doing a water pipeline system? Is the problem hydrates? Diagnosis of the problem is done really well today.
Treatment of the problem or, let’s say, how we want to prescribe the right chemistry to address those problems, that’s actually done really well today. There’s tremendous science that goes into…
Russel: I’d agree with both of those. I’d agree with both those statements. I think that’s very on point.
Matt: But here’s the problem. If we go to the doctor and he says, “Hey, you’ve got a cold and you need to take this medicine,” and he’s right about that and we don’t take the medicine, we’re still going to be sick.
Russel: Or if he says, “Take this much twice a day,” and we take twice that much every other day.
Matt: We’ve got a problem.
Russel: It’s not the same thing.
Matt: You’ve identified the challenge in the chemical management programs, the asset integrity programs. We see it time and time again. It’s delivery. It’s getting the right amount of chemistry to the right place at the right time.
It’s not necessarily picking the right chemistry. Our chemical service providers out there are wonderful scientists and they’re getting it done. The problem is as an industry we’re not getting the right amount of chemistry to the right place.
With pipelines, in particular, they’re typically very remote. What you might imagine is true, which is over-injection of sites is very common. You can’t get out there. You don’t know exactly what the conditions are going to be.
What do you do? You play for worst-case scenario, which means I’m going to over-inject the amount of chemical that I think I need just to make sure.
Number one, that’s way too much chemistry than you need. Number two, you might actually have to pay for that excess chemistry to be post-processed out downstream. We’ve got a number of customers that have those types of penalties. Those get expensive.
Over-injection is a huge issue, Russel. But an even bigger issue is under-injection. If you’re using corrosion inhibitors, iron sulfide, scale inhibitors.
Russel: What makes all that difficult is the way that chemistry works is sometimes I’m injecting based on how much time I want, sometimes I’m injecting based on how much volume I’m moving. Some of those chemicals, they react over time.
The actual getting the right chemical to the right place is about how you’re injecting it combined with a whole lot of knowledge about how you’re operating the pipe and how much you’re getting in, how much chemical you still have at the other end.
Matt: You’re exactly right. What you just framed up is a perfect place for technology to come in and play a role. What technology should be doing is providing on-demand chemical.
If you’ve got a changing temperature, like for hydrates or when your pigs are arriving, you should increase methanol at that point. You shouldn’t be wasting it if you don’t need it. If you’ve got a flow that you want to treat specific corrosion inhibitor or scale inhibitor, you should treat it based on the actual flow rates, not on just some static, worse-case PPM that you’re trying to hit.
What happens is if you take all of these challenges and you integrate them across hundreds if not thousands of continuous injection sites, you really start to see financial impacts add up.
By the way, I know we’ve talked about over-injection. The industry really suffers from under-injection. Under-injection is much more expensive in the long run because our pipeline infrastructure’s not being adequately protected.
Russel: I end up having to do other mitigations that are way more costly.
Matt: Exactly. This is an area where we’ve seen a lot of success. It’s a low-hanging fruit. It’s one that traditionally hasn’t yet been addressed by the control rooms, the pipeline control centers that are out there.
Russel: That’s not really the role of a pipeline control center.
Matt: That’s right.
Russel: That’s outside of what a pipeline control center’s supposed to be doing. Pipeline control center is about making delivery schedules and doing that without creating harm. That’s basically what a pipeline control center’s all about. All those operational details around efficiency, and chemicals, and all that other stuff is handled by others.
One of the other things that’s really true is that historically we’ve thought that all the data comes up from the field to the SCADA group and through the control room. I think that’s going to change. I think the data’s going to come up and the control room’s going to get what they need, and whatever that data’s coming up to, everybody else is going there for the data.
Matt: You’re exactly right. It works both ways. The control room’s going to contribute real-time data to data lakes’ DMZ zones. The opportunities that we’re bringing in through IOT and other technologies is augmenting what’s already in place out there in the field.
What’s cool about that is we get much better data sets to our customers that become the foundation for advanced analytics, AI, ML over time. This is what I get really excited about. That opportunity to become prescriptive as an industry is 100 percent attached to the underlying quality of the data sets that we capture and store.
Russel: That’s the part that everybody always misses when they talk about big data, and machinery analysis, and intelligence, and all that. What they always miss is you’ve got to have good data. It’s got to be accurate. It’s got to be relevant. It’s got to be organized. It’s got to be cleaned, and then I can do good things.
Matt: It’s got to be high resolution, which you said before.
Matt: You’re spot on. You’re spot on. Today, the industry has got big analytics engines that are trying to suck data, and it’s like sucking through a straw. The data’s not enough to provide interesting insights.
Russel: Our infrastructure doesn’t really support doing this stuff in a big way. There’s people that are doing projects that are focused on solving specific problems, but it’s a bigger challenge.
That leads me into something else I wanted to talk to you about, Matt, and that is this that there’s a buzz. There’s a new TLA in the world. TLA, for anybody that doesn’t catch that, that’s a three-letter acronym. The new TLA is ESG. What is ESG, and why should I care?
Matt: If you haven’t heard the term ESG yet, it is important to understand exactly what it stands for. Let’s unpack that. It stands for environmental, social, and governance. It also usually is attached to a word that we’ve referred to called sustainability. This actually has roots back in the Geneva Accord, probably about 10, 15 years ago.
What we’re seeing is it’s having a tremendous impact on Wall Street. We should all pay a lot of attention to that because Wall Street is beginning to require companies not just deliver on their financial commitments, but they want to see companies that also have a very specific sustainability and environmental, social, and governance agenda.
If you go in and start pulling websites up of some of the largest operators out there, Energy Transfer, ExxonMobil, Kinder Morgan, etc., you’ll find that they have sustainability reports front and center on their websites.
This is something that we believe is going to be here for the next decade-plus, and it’s something that’s going to drive Wall Street dollars, which means that every boardroom and every executive inside of the energy space is going to pay attention.
Russel: To me, this reminds me a lot of the whole environmental movement when it was in its infancy in the ’70, in early ’70s. At that time, there was a lot of — pollution was self-evident. You just go by any lake or stream pretty much anywhere, and you’d just find all kinds of trash, and pollution, and dumping, and all that. There’s still pockets of that, but nothing like it used to be. There’s whole watersheds that have been cleaned up over the last 50 years because of environmental policies.
The other thing that’s true is in the oil and gas business, 50 years ago we probably weren’t that sensitive to the idea of environmental protection. We are very sensitive to it now. ESG is, we’re on the precipice of something that’s going to have the same kind of impact.
Matt: You’re 100 percent right. Just to echo one of the things you’re saying, it almost feels like the world, at least Wall Street’s saying hey, energy hasn’t been clean or hasn’t been environmentally conscious, and that’s wrong. The industry’s made tremendous steps forward.
What’s changing in the next decade is we’re going to have to prove it. It gives us just a great opportunity to do so, to tell people, to educate.
Russel: It is a huge opportunity for the oil and gas business because when you start looking at oil and gas as a vehicle, and what’s the cost to the environment, and the cost in carbon, and the cost in operations, and the value provided versus so-called renewables, it’s going to be very interesting to see how that war of numbers shapes up.
When you start looking at what it takes to build an electric car, what it takes to recharge an electric car, what it takes to build a windmill, what it takes to support the full life cycle, what it takes to build batteries, what those mining operations look like, it’s not a clean technology.
Matt: You’re spot on, and disposal. What do you do with all that chemistry of those batteries going forward? I drive an F-350 diesel, and I like to have fun discussions with Tesla owners about whose carbon footprint is larger. It’s a fun discussion.
Russel: I’m sure it is. How does what we classically think of as technology and instrumentation, how’s that going to be impacted, or how’s it going to impact people’s ability to do ESG programs?
Matt: Number one, it gives us opportunities to put programs in-place in our field assets that we can quantify the environmental steps, the social steps, the governance steps that we’re taking as an industry.
Let me give you an example. If we use technology to avoid a trip to check a test station like we talked about earlier, that is a safety enhancement for that person. That is a carbon reduction. It’s a reduced truck roll. That is an opportunity to provide a much more rich, regulatory data set that is a governance component.
Through technology, you begin to build these stories and these vignettes that then go directly into sustainability reports and say, hey, we’re doing awesome things.
Russel: Matt, I’m sitting here. You’ve got my brain spinning here. This is really good.
If I take the idea of I’m going to put a geolocation device on my truck — and most operators have those now — and I’m going to monitor how many truck rolls I have to do, and if I change my operating philosophy such that I spend money so that I can operate these facilities without trips, and I take that back to a control room that can monitor to operate without hitting the trips, that’s a big change in operating philosophy for a lot of operators.
If I’m not having trips, I’m not having releases. I’m not venting. If I’m not having trips, I’m not rolling operators to do restarts. Those things change my carbon footprint. I might be able to get to an ROI on that to do the better or the enhanced level of automation. Then I can do big data analysis, and I can compare trips to miles, and I can look at just a straight operating cost.
The cost of a mile of driving in the oil field the last time I looked at the numbers, it was $5 a mile. When you take the operator’s time, the wear and tear on the vehicle, all those kinds of things, five bucks a mile for the miles I drive to operate my facilities — that starts to become pretty compelling.
Matt: It’s immensely compelling on many fronts. It’s a Management By Exception model. It’s a know-before-you-go.
It’s requiring companies like WellAware to give you much better visibility into your assets so that when you do roll a truck, which is still going to happen, you know before you go. You know what you’re going to see. You know what you’re going to address. You know what you need to maintain. You know what you need to service.
Russel: I did a project many years ago where we put automation on very small compressors — this company operated a fleet of compressors — and when a compressor would go down, they’d get a cry out that the compressor’s down, and they had to roll somebody out there to figure out why it went down.
They had to come back, fill out a work order, and then somebody else had to go to fix the problem. About a third of the time, there was another problem they needed to fix as well.
Matt: That’s right.
Russel: They put data collection, and we did some fancy stuff on it, but the bottom line is they were able to minimize the communications cost and yet still get rich data so they could look at first-in, first-out with trips and some history of critical information that would tell them that’s a mechanical problem, or we just need to top off fluids, or whatever.
They reduced their drive costs by half and their response time by fivefold.
Matt: The return on investment of these technologies, Russel, is off the charts. Just being a guy that loves looking at the data, I’ll tell you that the data is just a treasure trove of value. You can get to the multiple ROI on the cost of the technology implementation in almost day one.
What people fail to recognize is that there is an enormous mine that you can continue to extract gold from over months, years, and decades as you have that technology, and learn more. It’s a multiplicative. It’s a compounding opportunity.
Russel: It’s actually a capability that companies need to build because every wave of improvement drives additional waves that you’re going to get to or need to get to.
Matt: What we’re seeing is technology costs have been driven down so low that if you get technology into a form factor that can last in the harsh and hazardous remote conditions of oil and gas, you’re going to have something that’s very cost-effective.
One more thing we need to address around this topic, in my opinion, is what happens to the people, the people that were driving those trucks out there. The opportunity that I see for those folks is a tremendous upscale in their pay and in their responsibilities.
Instead of just driving out, looking at something, and writing it down on a sheet of paper, those very, very valuable technicians that understand our industry at the field level, at the asset level, they can now look at multiple data sets coming back and say, “Oh yeah. I understand what’s going on with that signature. I understand what’s going on with that waveform.”
They then can use their knowledge base across a much, much broader set. That windshield time is not valuable to anybody unless you just love country music and singing.
Russel: Or listening to the Pipeliners Podcast.
Matt: Yes. I missed that one.
Matt: It was right there. I whiffed it, but yes.
Russel: Thanks for that. That was a nice tee-up. I appreciate that. You’re absolutely right. I don’t think the jobs go away. I just think the nature of the job changes. It becomes less about driving around to see what’s running or driving around to turn things back on. It becomes more about analyzing what’s happening and determining how to make it better.
Matt: You got it. Spot on.
Russel: Here’s the last question I want to ask you, Matt. What do you think is going to be the most impactful thing to happen in technology in the next five years? I have my opinions. I’d like to hear yours. Then I’ll share mine. We’ll wrap this conversation up because I’m sure you and I could go on on this for hours. [laughs]
Matt: We could. It’s fun. Hopefully, folks are still with us. We’ve probably down to the folks that are technology geeks like we are. I think the biggest thing that’s happening is just Moore’s Law, the race to zero, basically the natural technology cost curve acceleration.
Compute is coming down so fast. You’re increasing compute in everything that’s technology. You’re dropping cost at the same time, which is mind-boggling. That’s why technology has infiltrated every aspect of our lives the way it has.
Russel: It’s getting so cheap to have a huge amount of processing power and a huge amount of data and long-life batteries and a whole bunch of stuff that we couldn’t really even contemplate even five years ago.
Matt: Exactly. It’s all those trends that are happening that need to make their way into the energy space, into harsh and hazardous remote environments that haven’t quite gotten here yet.
For folks that are used to having to pay thousands and thousands of dollars for art to use and sensors, that’s ridiculous. You’re not going to have to do that much longer.
Those technologies are going to be available at a much lower CAPEX or you may not even have to pay for them. You may just have to pay for the service attached to them, which is going to be much, much more affordable going forward. I think we’re going to see dramatic innovations in technology. Just the ability to collect better data sets that we can then get better insights from.
We’re also going to see business models change, where vendors are going to align themselves with data outcomes, which is all our customers really care about. They just want that data outcome. They don’t want to go buy another widget that they’ve got to go maintain out there. That’s costly and a pain when it doesn’t work.
I think aligning incentives around outcomes and improvements in operational and financial results and sustainability results, that’s where we’re heading as an industry and I think technology is going to play a big role in it.
Russel: I agree with all of that. I think my take would be that there’s a couple of forces that when we get to critical mass, we’re going to see a real rapid shift. The first is when we get edge devices that are low power and they meet the environmental protection requirements.
I’m talking about the div classifications, explosion-proof, that sort of thing. We get those out to the market. We don’t have them yet. That’s going to be a transformation. It’s going to be a huge acceleration. That’s number one.
The next thing is there are a number of companies that I’m aware of that are working on tools that allow you to create an enterprise model for your real-time data that looks more like a relational database that you can actually build a schema and manage a schema around your real-time data so you can create some consistency around your data. That’s really important. Once that happens, there’s one last piece that has to happen.
Third is that we have some tools that will clean the data. Historians kind of do that now, but the need is going to be to do that. Historians do that as they go into the lake, if you will. There’s going to be a need for that to be happening in real-time on the fly. Once you get there, that’s when we’re really going to see a whole other round of acceleration I expect to see within a relatively short period of time.
We’ll just leave a teaser for the listeners that Matt has some technology in this domain he’d love to talk to you about. If you want to know more, you can go to the website and look up this episode and look up Matt.
Anyways, that’s my take. I think that we’re already there in terms of the capability of edge devices. We’re already there in terms of cost and capability getting data from and to the edge. We just don’t have these other pieces of infrastructure. Once they happen, the whole way that we think about field automation and control is going to shift.
Matt: Yeah, I totally agree with you. It starts with great data from the edge. Being able to store data at much higher resolution, that’s where the cloud comes in. AWS and Azure and even Google are playing huge roles in both storing and cleaning that data.
Russel: They’re way out in front in some of the things they’re doing in their big partnerships with folks like PTC and Rockwell and others. They all see this coming and they’re spending big dollars to get ready.
Matt: You bet. Then the last one you said about data normalization and cleaning is huge. The cost of bad data is worth an entire podcast on its own. We could talk about that another time.
You’re right. If you can’t get high-quality, normalized, clean data sets from the field, it makes it really difficult to extract the valuable insights that lie within that data. That’s what’s happening.
I think everyone that’s listening to this job that’s responsible for moving hydrocarbons around, your job should get a lot easier over the next decade. At least technologists owe it to you to make that the case.
Russel: I think it’s going to get a lot more interesting as well. That’s my take.
Matt: I think you’re right.
Russel: I think it’s going to get a lot more interesting. Hey, this has been awesome. I’ve enjoyed it. We need to do it again. Probably next time though we’ll dig into a specific project and really get into the nitty-gritty of the tech.
Matt: Love to do that. Thanks for having me, Russel. This has been wonderful. I’ve enjoyed it.
Russel: I as well. I hope you enjoyed this week’s episode of the Pipeliners Podcast and our conversation with Matt. Just a reminder before you go, you should register to win our customized Pipeliners Podcast YETI tumbler. Simply visit pipelinepodcastnetwork.com/win to enter yourself in the drawing.
Russel: If you have ideas, questions, or topics you’d be interested in, please let me know on the Contact Us page at pipelinepodcastnetwork.com or reach out to me on LinkedIn. Thanks for listening. I’ll talk to you next week.
Transcription by CastingWords