Using disruption management to increase oil recovery rates in the digital oil field

According to the January 2008 edition of the Energy Insights Insights on Oil & Gas Newsletter, “[The] Pressure is on to increase recovery rates from known reserves given the expense of exploration.” And, “The Digital Oil field will see continued growth with enhanced production optimization.” In response, the authors state, “Oil and gas companies will look to tools for project and portfolio management, especially analytics that are able to support optimization.”

One important aspect of this situation that is not being addressed effectively is the need for E&P organizations to remain agile in the real world of rapidly changing operational conditions. Optimization as a goal is laudable, but not necessarily attainable or even practical when the assumptions you use in developing your optimization models change by the day or even by the hour. We believe that interactive decision support applications that rapidly determine good, feasible and actionable solutions to an optimization problem will trump tools that determine a single mathematically precise “optimal” solution that is static or brittle in the face of disruption. Indeed, from an operational perspective, the practical need to manage disruption is the primary goal, rather than the theoretical need to optimize operations.

So, what does “disruption management” really entail?

In Disruption Management: Framework, Models and Applications”, the authors state in their introduction that “No matter how superior a plan is, in the execution phase, various unanticipated events will disrupt the system and make the plan deviate from its intended course and even make it infeasible. How to cope with disruptions? How to reach our goals while minimizing all the negative impact caused by disruptions? How to get back on track in a timely manner while effectively using our available resources? These are the essential topics investigated in the field of ‘disruption management.’”

We’ll explore this topic further in the context of the digital oilfield in a subsequent post.