Data Management and Improving Production
A few weeks ago, Entrance sponsored the Professional Petroluem Data Management Association’s (PPDM) lunch here in Houston on the topic of, “What is a Well?” The speaker, from Laredo Energy‘s Information Systems group discussed some of the difficulties that his company experienced as they used data management to move from exploiting new plays to focusing on engineering and optimization.
As we’ve discussed in previous posts, this move towards an efficient manufacturing model that is focused on innovation and constant improvement is becoming more and more important for the shale industry. For Laredo, this data issue came to a head because the connection between data management, G&G, software development, and the IT infrastructure was not well integrated.
A lack of integration meant that most departments could not see the data they needed on a daily basis. This prevented any kind of intelligent business intelligence, which led different departments to “take matters into their own hands and maintain their own data and systems.”
Business Intelligence as a Goal
While creating separate systems was a natural reaction to this problem, it also put the company even further from any semblance of a unified system. Many people within the company were not aware that this was such a big problem, so part of the Information System team’s job was to make the case to stakeholders for change. The framing of the issue went something like this:
“What is the goal of our business?: The goal of the business is to profit from the discovery, development, and sale of reserves.
How can we achieve that goal?: By being an intelligent business.
Therefore, what is the goal of IS? : To enable business intelligence.”
The specific focus on business intelligence as a goal was strategic. As Laredo put it, business intelligence “is relatively understandable, [and it] helps non-IT users see value in a partnership with Information Systems.”
Bringing Separate Data Systems Together
Once the key stakeholders were on board, Information Systems worked towards a data management plan that could establish one version of the truth from these fragmented systems. They identified specific “data objects” that were important to generating prospective drilling opportunities. Examples of these objects include 3D seismic, leases, wellbores, and production. Laredo also had to address a common issue across the oil and gas industry of unclear naming conventions.
Specifically, the meaning of the word well has become overloaded, to the point that across a number of departments, several different meanings could be interpreted. Examples of the possible meanings are the well bore itself, completions, or the location. The lack of a common language generated confusion, in addition to presenting a further barrier to communication and good decision making.
As Laredo related, “An organization can have very high quality data, but if the business users can’t access it efficiently and effectively, it loses value. Data needs to be formatted and delivered to appropriate user interface tools in order to have value to the business. Data access involves interaction between data management, software development, and IT Infrastructure.”
making data priorities
Since Laredo can’t make every data management project happen at once, they have now created a data object prioritization list that lines up to their business goal of efficient production. This list contains “over 25 data objects with definitions, sources and uses, business rules, etc. to aid strategic initiative funding decisions.”
Their new system uses master data management best practices that remove a lot of the possibility of error, in addition to making data available on the spot. Multiple versions of well and well location data are automatically synced, eliminating the possibility of duplication. Even better, since information is available much sooner, it is possible to learn from mistakes and make improvements in a time effective manner.
For more on this topic, read this post on how data management can make your information a benefit, not a burden.