Oilman Magazine Nov/Dec 2018 loading...
Fundamentals in the Oil
Field Matter Even More
with Big Data
p. 28
Safety Practices and Procedures
in the Oil Industry and
Technology’s Inuence
p. 13
U.S. Federal Regulatory
Bodies in the Energy
Sector
p. 12
How Oil and Gas Companies
Can Use AI Technology When
Disasters Occur
p. 6
THE MAGAZINE FOR LEADERS IN AMERICAN ENERGY
November / December 2018
OilmanMagazine.com
BRIDGING THE GAP IN
OIL AND GAS TRAINING
Fundamentals in the Oil
Field Matter Even More
with Big Data
p. 28
Safety Practices and Procedures
in the Oil Industry and
Technology’s Inuence
p. 13
U.S. Federal Regulatory
Bodies in the Energy
Sector
p. 12
How Oil and Gas Companies
Can Use AI Technology When
Disasters Occur
p. 6
THE MAGAZINE FOR LEADERS IN AMERICAN ENERGY
November / December 2018
OilmanMagazine.com
BRIDGING THE GAP IN
OIL AND GAS TRAINING
ONE APP.
ONE TABLET.
The Spotter inspection app is equipped
with every tool you need to record,
capture, and report on the spot.
With the Spotter inspection app you can trade in your pen, paper, and camera
for one tablet. Spotter uses tablet functionalities to create fully-customizable,
accurate, and thorough inspections whether you’re in the Gulf or at the top
of a cracking tower. Upgrade your inspection process and increase safety and
eciency at any facility with Spotter and intrinsically safe tablets.
Work oine with no internet connection required
Take photo, video, and audio directly in the report
Automatically route workows for digital signatures
Implement high accountability by GPS location capture
Create custom inspection forms with a powerful,
user-friendly template builder
Integrate into any internal system, accounting or ERP
Stay safe with Class I, Div II Intrinsically Safe tablet
devices and cases
START YOUR FREE TRIAL
envoc.com/energy
ANY INSPECTION.
ANY LOCATION.
Proudly developed in Louisiana by Louisiana natives at Envoc. Learn more about how we can help your
business run more eciently with custom software solutions that work for you.
envoc.com
by
IN THIS ISSUE
Feature
The Missing Piece: Educating the Oil and Gas
Workforce to Bridge the Skills Gap
By Sarah Skinner - pages 22
24
In Every Issue
Letter from the Publisher – page 2
OILMAN Contributors – page 2
OILMAN Online // Retweets // Social Stream – page 3
Downhole Data – page 3
State Oil & Gas Associations – page 8
Product Showcase: Fox Thermal – page 11
OILMAN Columns
Eric R. Eissler: U.S. Federal Regulatory Bodies in the Energy Sector – page 12
Tonae’ Hamilton: Safety Practices and Procedures in the Oil Industry and Technology’s Inuence – page 13
Eric R. Eissler: Blockchain in Oil and Gas is Not Hype – page 14
Mark A. Stansberry: Forty-Five Years Later… – page 15
Josh Robbins: Oil and Gas Acquisition Market 2019 Outlook – page 15
Tonae’ Hamilton: Interview: Kent Bartley, President, Maviro – page 25
Jason Spiess: The 75K Well Drilling Prots in the Illinois Basin – page 36
Guest Columns
Corrosionpedia: How New Oil & Gas Extraction and Transportation Methods are Inuencing Pipeline Corrosion – page 4
Tim Willis: How Oil and Gas Companies Can Use AI Technology When Disasters Occur – page 6
Rick Pedley: Protective Clothing Buyer’s Guide for the Oil Industry – page 9
Joe Dancy: Drones Making Headway in Advancing E&P – page 10
Aaron Kline: Solving the Capacity Crunch in Today’s Petrochemical Supply Chain – page 16
Joe Saunders: How Runtime Application Self-Protection (RASP) Can Prevent Cyberattacks in Oil & Gas Environments – page 18
Merrick Alpert: Advanced Anti-Corrosion Coating Utilized on Two North Sea Offshore Platforms – page 20
Kent Landrum: Preparing for Digital Downstream Supply Chain Capabilities – page 26
Shiva Rajagopalan: Fundamentals in the Oil Field Matter Even More with Big Data – page 28
Evan Cox: The ROI of Business Continuity Can Be Found in the Cloud – page 30
Shane Randolph: Commodity Hedging: Lessons Learned by Early Adopters of New Hedge Accounting Rules – page 32
Jeff Berkowitz: In The New Age Of Activism, Minimizing Political And Reputational Risk Is Key – page 34
Oilman Magazine / November-December 2018 / OilmanMagazine.com
1
ONE APP.
ONE TABLET.
The Spotter inspection app is equipped
with every tool you need to record,
capture, and report on the spot.
With the Spotter inspection app you can trade in your pen, paper, and camera
for one tablet. Spotter uses tablet functionalities to create fully-customizable,
accurate, and thorough inspections whether you’re in the Gulf or at the top
of a cracking tower. Upgrade your inspection process and increase safety and
eciency at any facility with Spotter and intrinsically safe tablets.
Work oine with no internet connection required
Take photo, video, and audio directly in the report
Automatically route workows for digital signatures
Implement high accountability by GPS location capture
Create custom inspection forms with a powerful,
user-friendly template builder
Integrate into any internal system, accounting or ERP
Stay safe with Class I, Div II Intrinsically Safe tablet
devices and cases
START YOUR FREE TRIAL
envoc.com/energy
ANY INSPECTION.
ANY LOCATION.
Proudly developed in Louisiana by Louisiana natives at Envoc. Learn more about how we can help your
business run more eciently with custom software solutions that work for you.
envoc.com
by
Gifford Briggs
Gifford Briggs joined LOGA in 2007 working
closely with the Louisiana Legislature. After
nearly a decade serving as LOGAs Vice-
President, Gifford was named President in
2018. Briggs rst joined LOGA (formerly
LIOGA) in 1994 while attending college at
LSU. He served as the Membership Coordinator and helped
organize many rsts for LOGA, including the rst annual
meeting, Gulf Coast Prospect & Shale Expo, and board
meetings. He later moved to Atlanta to pursue a career in
restaurant management. He returned to LOGA in 2007.
Mark A. Stansberry
Mark A. Stansberry, Chairman of The
GTD Group, is an award-winning: author,
columnist, lm and music producer, radio
talk show host and 2009 Western Oklahoma
Hall of Fame inductee. Stansberry has written
ve energy-related books. He has been
active in the oil and gas industry for over 41 years having
served as CEO/President of Moore-Stansberry, Inc., and
The Oklahoma Royalty Company. He is currently serving
as Chairman of the Board of Regents of the Regional
University System of Oklahoma, Chairman Emeritus of the
Gaylord-(Boone) Pickens Museum/Oklahoma Hall of Fame
Board of Directors, Lifetime Trustee of Oklahoma Christian
University, and Board Emeritus of the Oklahoma Governor’s
International Team. He has served on several private and
public boards. He is currently Advisory Board Chairman of
IngenuitE, Inc. and Advisor of Skyline Ink.
Thomas G. Ciarlone, Jr.
Tom is a litigation partner in the Houston
ofce of Kane Russell Coleman Logan PC,
where he serves as the head of the rm’s
energy practice group. Tom is also the host of
a weekly podcast on legal news and develop-
ments in the oil-and-gas industry, available at
www.energylawroundup.com, and a video series on effective
legal writing, available at www.theartofthebrief.com.
Jason Spiess
Jason Spiess is an award winning journalist, talk
show host, publisher and executive producer.
Spiess has worked in both the radio and print
industry for over 20 years. All but three years of
his professional experience, Spiess was involved
in the overall operations of the business as a
principal partner. Spiess is a North Dakota native, Fargo North
Alumni and graduate of North Dakota State University. Spiess
moved to the oil patch in 2012 living and operating a food truck
in the parking lot of Macís Hardware. In addition to running a
food truck, Spiess hosted a daily energy lifestyle radio show from
the Rolling Stove food truck. The show was one-of-a-kind in the
Bakken oil elds with diverse guest ranging from U.S. Senator
Mike Enzi (WY) to the traveling roadside merchant selling ags
to the local high school football coach talking about this week’s
big game.
Joshua Robbins
Josh Robbins is currently the Chief Executive
Ofcer of Beachwood Marketing. He has
consulted and provided solutions for several
industries, however the majority of his consulting
solutions have been in manufacturing, energy
and oil and gas. Mr. Robbins has over 15 years
of excellent project leadership in business development and
is experienced in all aspects of oil and gas acquisitions and
divestitures. He has extensive business relationships with a
demonstrated ability to conduct executive level negotiations. He
has developed sustainable solutions, successfully marketing oil
and natural gas properties cost effectively and efciently.
Steve Burnett
Steve Burnett has been working in the oil
industry since the age of 16. He started out
working construction on a pipeline crew and
after retirement, nishes his career as a Pipeline
Safety Compliance Inspector. He has a degree in
art and watched oil and art collide in his career
to form the “Crude Oil Calendars.” He also taught in the same
two elds and believes that while technology has advanced, the
valuable people at the core of the industry and the attributes they
encompass, remain the same.
As we get closer to the end of the year and look back at the activity during the past
several months, it’s easy to say that the industry can be termed as the bounce back
year. Some may say it has been a steady year, with not much to discuss, and yet a few
in the industry felt the pain of further cut backs.
On the nancial side, the price per barrel has remained in a range comfortable for
most producers to earn a prot. This in turn fuels a healthy market for companies
to buy equipment, hire personnel and invest in expansion. Proof of this is clearly
shown in the Permian and Eagle Ford Basin. Operators are doing so well there, they
are producing record amounts of oil and gas, but getting it to the market has been painful. The pipeline
bottleneck and shortage of truckers has slowed down ow for export to the Gulf of Mexico. However, it
has been reported over the past year that several new pipelines will open in 2019 and in turn will improve
the ow to export terminals.
Product and service technology in the oil and gas market is growing and improving at every turn.
The industry now has a taste for machine learning and what IoT can do and there is no turning back.
Blockchain still in its infancy in the crude market, but it will be just as common in years to come.
Innovation and technology are key to improving business efciency so that employees and processes
perform better. If the correct technology is in place and employees are performing well with its use, the
results in many companies are often improved market share and a business that is thriving.
In this issue of OILMAN our feature article is about oil and gas training and continuing education. As
I mentioned, deploying the best technology that is the right t for each employee’s role is key, but not
training or hiring qualied employees ultimately weakens a company’s capital investment in the new
technology. Knowledge transfer is crucial as well. When older employees are set to retire it’s in a company’s
best interest to transfer long held knowledge to younger employees entering the eld. Recent graduates
or entry level employees often come with fresh ideas. Companies benet the most when they merge time-
tested knowledge from seasoned personnel with new processes from recent recruits, when that’s coupled
with emerging technology, the end result is improvement in productivity.
MAGAZINE
NOVEMBER DECEMBER 2018
PUBLISHER
Emmanuel Sullivan
MANAGING EDITOR
Sarah Skinner
ASSOCIATE EDITOR
Tonae’ Hamilton
FEATURES EDITOR
Eric Eissler
GRAPHIC DESIGNER
Kim Fischer
CONTRIBUTING EDITORS
Gifford Briggs
Steve Burnett
Thomas Ciarlone, Jr.
Joshua Robbins
Jason Spiess
Mark Stansberry
SALES
Eric Freer
To subscribe to Oilman Magazine, please
visit our website, www.oilmanmagazine.
com/subscribe. The contents of this
publication are copyright 2018 by Oilman
Magazine, LLC, with all rights restricted.
Any reproduction or use of content without
written consent of Oilman Magazine, LLC
is strictly prohibited.
All information in this publication is
gathered from sources considered to be
reliable, but the accuracy of the information
cannot be guaranteed. Oilman Magazine
reserves the right to edit all contributed
articles. Editorial content does not
necessarily reflect the opinions of the
publisher. Any advice given in editorial
content or advertisements should be
considered information only.
CHANGE OF ADDRESS
Please send address change to
Oilman Magazine
P.O. Box 771872
Houston, TX 77215
(800) 562-2340
Cover image courtesy of
Orlando Rosu – www.123RF.com
LETTER FROM THE PUBLISHER
CONTRIBUTORS — Biographies
Oilman Magazine / November-December 2018 / OilmanMagazine.com
2
Emmanuel Sullivan, Publisher, OILMAN Magazine
Oilman Magazine / November-December 2018 / OilmanMagazine.com
33
For The Week Ending October 26, 2018
DIGITAL DOWNHOLE DATA
Colorado: 32
Last month: 33
Last year: 33
North Dakota: 54
Last month: 53
Last year: 49
Texas: 537
Last month: 529
Last year: 441
Louisiana: 61
Last month: 62
Last year: 65
Oklahoma: 141
Last month: 141
Last year: 125
U.S. Total: 1,068
Last month: 1,054
Last year: 909
OIL RIG COUNTS
*Source: Baker Hughes
Brent Crude: $80.45
Last month: $78.90
Last year: $57.69
WTI: $69.25
Last month: $70.80
Last year: $50.61
CRUDE OIL PRICES
*Source: U.S. Energy Information Association (EIA)
Per Barrel
Colorado: 13,741,000
Last month: 12,736,000
Last year: 10,902,000
North Dakota: 39,073,000
Last month: 36,575,000
Last year: 32,222,000
Texas: 138,548,000
Last month: 132,698,000
Last year: 106,687,000
Louisiana: 3,959,000
Last month: 3,879,000
Last year: 4,353,000
Oklahoma: 16,873,000
Last month: 15,717,000
Last year: 13,734,000
U.S. Total: 339,895,000
Last month: 320,856,000
Last year: 289,132,000
CRUDE OIL PRODUCTION
*Source: U.S. Energy Information Association (EIA) – July 2018
Barrels Per Month
Colorado: 151,332
Last month: 143,773
Last year: 139,706
North Dakota: 63,825
Last month: 59,474
Last year: 51,351
Texas: 679,594
Last month: 648,235
Last year: 621,007
Louisiana: 247,966
Last month: 232,273
Last year: 166,507
Oklahoma: 252,022
Last month: 241,436
Last year: 213,033
U.S. Total: 2,782,895
Last month: 2,642,766
Last year: 2,478,626
NATURAL GAS
MARKETED PRODUCTION
*Source: U.S. Energy Information Association (EIA) – July 2018
Million Cubic Feet
Per Month
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Oilman Magazine / November-December 2018 / OilmanMagazine.com
4
How New Oil & Gas Extraction and
Transportation Methods are
Influencing Pipeline Corrosion
By Corrosionpedia
OILMAN COLUMN
The oil and gas industry has been steadily
increasing production rates to keep up with the
rising global demand for energy. According to
statistics from BP, global oil production has
increased from 63 million barrels per day in 1980
to 92 million barrels per day in 2016. In addition,
global natural gas production has risen from
approximately 1,430 billion cubic meters to over
3,500 billion cubic meters during the same time
period. New technologies have been introduced to
meet the demand, but they create new challenges
in terms of the impact they place on existing
infrastructure. This makes the importance of
protecting pipeline assets all the more important.
Not only are companies less able to afford
delays or mistakes, but more robust pipeline
protection systems typically mean less scheduled
maintenance.
Here, we’ll take a look at some of the oil and gas
extraction methods being used and their impact,
as well as some possible solutions for reducing
that impact.
Enhanced Oil Recovery
To meet rising demand, advanced oil and gas
extraction techniques, called EOR (Enhanced Oil
Recovery), are used to help increase the efciency
of extraction and transportation of oil and gas
from natural reserves. These increased production
rates, combined with the aggressive environments
produced by enhanced oil recovery techniques,
have placed extra burdens on existing wells,
pipelines and their associated components.
Pipeline corrosion is a well-known issue in the oil
and gas industry worldwide. In a study conducted
by NACE, it is estimated that pipeline corrosion
costs anywhere between $5.4 billion and $8.6
billion in the U.S. alone. (For more on this subject,
see 21 Types of Pipe Corrosion & Failure.)
Unfortunately, in the dynamic and fast-paced
oil and gas industry, an increase in production
is not always equally met with a bigger budget.
Often, operators are pressured to ensure the
optimum efciency of pipelines while keeping
costs to a minimum. Furthermore, some critical
components, such as anges, and by extension,
ange isolation components (washers, bolts and
gaskets) used in wells and pipelines have remained
largely unchanged for the past 50 years. Industry
sources estimate the global cost of corrosion in
the oil and gas industry to
be in excess of $1.3 billion.
For offshore facilities, some
operators estimate 60 to
70 percent of maintenance
costs are directly related to
corrosion issues.
Pipeline corrosion in
petrochemical plants and
reneries typically come in
the form of:
Internal corrosion, which
is due to aggressive gases
such as carbon dioxide
(CO2) and hydrogen
sulde (H2S).
Flow-induced corrosion or erosion corrosion,
which are caused by high-velocity, high-pressure
ow rates in the pipeline.
Enhanced oil recovery techniques meant to
increase the extraction volume and efciency can
greatly increase the risk of the types of corrosion
previously mentioned. The three main methods of
EOR commonly used are thermal injection, gas
injection and chemical injection. We’ll have a look
at these in depth here. However, it has become
apparent that new technologies are needed to
match the increased production volumes and
the aggressive physical and chemical properties
of extracted oil and gas. Because, rest assured,
enhanced oil recovery methods are not going
away. In fact, the problem is likely to only become
more prevalent as these methods persist and oil
and gas becomes sourer over time.
Gas Injection
Gas injection, or miscible ooding, is currently
the most common method of EOR. It is typically
used after water ooding to help sweep the
formation for remaining oil deposits that may
have either been missed or trapped due to waning
pressure. A gas, such as CO2, is injected into the
well at its supercritical phase (temperature, 87.9°F
(32°C); pressure, 1070 atm). During this phase,
the CO2 adopts the properties of a liquid that,
despite its low viscosity, is miscible with oil, and
also expands to help boost declining pressure in
the formation.
However, when supercritical CO2 reacts with
water in the oil reserve, carbonic acid (H2CO3) is
produced. This acid lowers the pH in the reserve
to create an environment that is highly corrosive
for metallic components. In addition, hydrogen
sulde gas (H2S) may also be mixed with CO2
before gas injection to improve miscibility
between the petroleum and the injected CO2. H2S
is, however, very toxic and also highly corrosive,
which can further exacerbate the corrosion of
piping and equipment.
Thermal Injection
Thermal injection involves raising the temperature
in the reservoir to reduce the viscosity of the
heavy crude and improve its mobility within
the reservoir. Increasing the temperature in
the formation is most commonly achieved by
pumping steam into the well in a fashion similar to
gas injection.
When the steam moves away from the injection
well and comes into contact with the oil, its
temperature drops and the steam condenses to
hot water. This hot water heats the oil, causing it
to expand and become less viscous.
Because some formations may contain acidic
minerals, the steam may also dissolve some of
these compounds, causing toxic gases to blow
out at the surface. In addition, the intense heat
generated by this process can cause excessive wear
and degradation of pipeline components.
Photo courtesy of Corrosionpedia