DIGITAL OILFIELD AND THE CLOUD

Digital Oilfield and the Cloud

By Osama Hasan Khan

With the advent of Digital Oilfields, IT architecture must deal with tremendous volumes of data throughout the oilfield lifecycle. With thousands of sensors, streaming data, the emphasis has shifted from data acquisition and storage, to managing and leveraging the information. Thus, it is not just about how much data you have; it is about what you do with it? The current IT scenario has failed to exploit the benefits of this data volume to the fullest.

In the meanwhile, computing world has seen a revolution by the name of “Cloud Computing”.  This buzzword has been resonating in technology circles for the last two to three years. Some call it the third IT industry revolution after the rise of Personal Computers and the Internet. But what actually is Cloud Computing? Cloud computing refers to the processing and storage of your data on computers and data centers based away from your own premises.  You are utilizing computing power that you do not own, and which is located somewhere else, in “the cloud”. Cloud computing derives its name from the fact that cloud shaped icons are used to depict the internet on network diagrams signifying that the end-user does not need to know the details of what is happening inside the internet (i.e. it is cloudy) but still can be sure that the data transmitted will arrive at its destination.

Imagine a world where software applications are no longer constrained by hardware requirements, where you can consume as much computing power as you need without having to buy a supercomputer. More importantly, imagine a world where you pay only for the computing power that you utilize just like you pay for electricity or any other utility. You do not have to buy a power plant to get electricity; you just pay for the amount that you use. And if you are still not fascinated by this idea, then imagine a world where you can use a reservoir simulator or any other computationally intensive software on your mobile or any other handheld device that has a web browser. Cloud computing is the concept that will be taking us into this world; if it hasn’t done so already.

Cloud computing brings us into the era of web applications banishing the desktop applications. A desktop application is one which is installed on your PC and uses your computer’s resources to run. A desktop application is constrained by your computer’s hardware capability. A web application, on the other hand, is installed and executes on a remote computer (a server) and you can access it through your PC using only a web browser. The advantage lies in the fact that the application is now running on the server, which is a much powerful computer than your PC. Your PC acts as a terminal, just sending the inputs and displaying the outputs. The major processing part is being done on the server. Thus, your PC’s responsibilities are drastically diminished and so are the hardware requirements.

Cloud computing is not an outrageously new idea. In fact, it has been around, since the arrival of the internet. There is good chance that you have already used some form of Cloud Computing. If you have an e-mail account with a web-based e-mail service like Hotmail, Yahoo, Mail or Gmail, you probably know that instead of running an e-mail program on your computer, you log in to a Web e-mail account remotely through your browser. The software and storage for your account doesn't exist on your computer - it's on the service's computer cloud. What’s new is that more and more software are now being written to be used over the internet. There are web-based word processing programs like Google Docs, photo and video editing programs like Pixlr and JayCut and more. In fact, you name a desktop based application and there is good chance that you will find a web-based counterpart, now or in the very-near future.

But, what has Cloud computing got to do with the Oil and Gas Industry? The computing requirements of this industry have always been high and will become increasingly higher with the arrival of Digital Oilfields. The petroleum industry is dominated by demand for data, high performance computing and collaboration tools. This requires servers, networks, bandwidth, data storage, power and a place to house and cool it. Additionally, staff is required for administration, maintenance and support.

Construction of such on-premises IT infrastructure saddles E&P companies with high pfront costs. The maintenance of these facilities is also a concern. Cloud Computing provides a solution for this problem, often called “Infrastructure as a service (IaaS)”. IT industry giants like Microsoft, Google, Amazon, IBM and others have built huge data centers across the globe and offer this infrastructure to clients as a service. This means that an E&P company can store all of its data in these remote data-centers eliminating the need for an on-premises data center. This also makes the data available anywhere, anytime thus facilitating advanced collaborative environments. The client company pays only for the computing resources it utilizes usually on an hourly or monthly basis which drastically reduces the upfront cost.

Another advantage of IaaS is scalability. Suppose that due to some new operation, the computing requirement of the client increases. In a conventional setup, this would require purchase and installation of new equipment which is both expensive and time-consuming. And what if the computing demand decreases later on? The surplus capability will be wasted. But with IaaS, the client can easily increase or decrease the computing resources that it has acquired by merely a few clicks ensuring efficient utilization of resources.

Software as a Service (SaaS) is another attractive aspect of Cloud Computing. This stipulates that you no longer need to buy expensive software and install it on a local machine. Instead, the software is installed on a remote computer (in the cloud) and can be accessed through a browser. The software vendor charges you on a pay-per-use basis i.e. you pay as much as you use the software. If the need for the software is eliminated, you cancel your subscription and stop paying. If a new version of the software is released, you don’t need to buy it again. All you need is to transfer your subscription to the newer version thus ensuring that you have the latest capabilities at hand all the time.

The penetration of Cloud computing in the Petroleum industry is encouraging but not as aggressive when compared with its infiltration in other industries. According to IDC’s 2010 Vertical Group Survey, 10.3% of oil and gas companies are currently using or implementing cloud computing and 7% have cloud computing on their technology road map (Figure 3).

The main reason behind this somewhat lethargic approach is doubts regarding data privacy and security. The protection of trade-secrets and sensitive data such as well-logs needs to be ensured to increase the confidence of upstream companies in investing this technology. This has led to greater adoption by the oil and gas industry of the “private” cloud rather than the “public” cloud. The private cloud is designed for restricted access to a single enterprise. While this might be a viable option for industry giants, the smaller companies must benefit from the public cloud to avoid the high CAPEX associated with setting up a private cloud. A combination of public and private cloud features, referred to as hybrid cloud, is another option.

Software as a service is quickly proving its worth for the E&P industry. iStore (The Information Store) has developed the industry’s first Software as a Service offering by launching its PetroTrek® Digital Oilfield Online solution. Baker Hughes is using Microsoft’s cloud services to conduct complex computations such as well log processing and in one case, has cut simulation times from nine months to less than 30 days, according to Microsoft CEO Steve Ballmer. Cloud Computing has also helped Baker Hughes in its green-IT initiative aimed at reducing the impact of its IT operations on the environment. Advanced Seismic Technologies, a seismic processing software developer, has developed a cloud-based seismic imaging and processing software called Oasis® that will eradicate the need for high-performance computing clusters to be installed on-site. Oasis provides velocity model building, graphical representation of seismic data, creation of seismic data subsets, and other capabilities. Emerson has also tested its reservoir modeling software Roxar RMS on Amazon EC2 (Amazon’s cloud offering). Other high performance computing applications are expected to be deployed in the cloud soon.

Cloud computing has enabled the smaller independent operators to use the same state-of-the-art software technologies utilized by the super-majors thereby leveling the playing field and enabling the benefits of the digital oilfield technology - increased asset performance, reduced cycle time, improved safety and enhanced business decisions - to be exploited across the board.

                                                                                 WRITTEN BY: OSAMA HASAN KHAN

REFERENCES:

1.       “How Cloud Computing works?” howstuffworks.com

2.       “A roadmap for Cloud Computing in Upstream”, by Oscar Teoh and Ben Parker

3.       “Cloud Computing Can Be Applied For Reservoir Modeling” by Tyson Bridger, Emerson Process Management

4.       “Oil and Gas: Into the Cloud?” by Jill Feblowitz, Vice President, IDC Energy Insights

5.       Microsoft Case Study: Windows HPC Server 2008 R2 – Advanced Seismic Technologies.

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