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Driving Down Decommissioning Costs with Digital Twins

By FutureOn Today

Decommissioning is an inevitable and expensive part of the lifecycle of every offshore oil and gas asset; however, emerging digital twin technology could not only delay the cost but also save oil and gas companies as much as 15% on the total cost of decommissioning.

At present, there are over 6,000 offshore oil and gas platforms globally, many of them ageing structures that are outdated in terms of design, technology and production. Field depletion, stricter environmental regulations and poor market performance makes their decommissioning both inevitable and imminent.

Rystad Energy estimates that the growing total value of the global decommissioning market could reach £34.5 billion by 2024. Although this is good news for decommissioning services, it represents a massive headache for oil and gas operators.

Decommissioning in the oil and gas industry is typically an arduous undertaking that requires extensive logistical planning and is essentially a capital intense project that diverts cash and human resources away from other areas of the business. Projects can last upwards of 18 months and require that thousands of tons of material be lifted, removed and disposed of on land. This requires a significant amount of heavy equipment and manpower.

Supermajors such as Shell, Total, Repsol and Premier Oil are expected to assign 10% or more of their North Sea spending in the next five years to removal projects. Aside from the high cost of decommissioning, this end-of-life project can be hazardous to offshore workers and the environment if not handled with the utmost care.

According to the Oil and Gas Authority, some of the primary risks to decommissioning cost escalation have been identified as the following:

  • Operator commercial misalignment/lack of collaboration
  • Poor execution performance
  • Delayed activity planning
  • Lack of real-time visibility of decommissioning during execution

A detailed understanding of ageing assets is essential

Poor historical field or asset data is a major factor impacting the successful planning and execution of a decommissioning program. Mistakes, revisions and project delays can significantly increase project costs. Understanding the condition and limitations of assets such as wells and platforms prior to offshore mobilization, is vital to developing a strong execution plan, accurate cost estimates, risk calculations and general project management.

Operators must also ensure they are fully aware of and compliant with regional decommissioning regulations, which can vary significantly from location to location. More mature oil and gas markets such as Mexico, the US and the North Sea, have stringent decommissioning regulations, while in territories like Southeast Asia regulation is still in the development stage and almost non-existent in some places.

Typically, decommissioning an asset in a tightly regulated region takes longer and is more expensive. For example, in the North Sea, operators are responsible for removing and disposing or recycling all asset materials from the ocean. Whereas in locations that allow Rigs-to-Reefs, a controversial practice, operators can leave platforms in the ocean or only partially remove structures thereby cutting their expenses.

Whether lax or strict, decommissioning regulations also require a comprehensive understanding of assets to ensure that operators meet those parameters and avoid hefty fines and further damage to the environment and marine life.

Digital twinning is an all-in-one solution to asset integrity management

Good decisions are made based on good data; digital twin technology with its ability to gather, prioritize, and visualize complex data quickly can support those critical decisions. With a comprehensive and detailed understanding of the asset within the context of its environment, those involved in its decommissioning can better optimize their plans to ensure the program is carried out in the safest and most-cost effective way possible.

Housed on the cloud, the twin acts as a trustworthy source of real-time asset information. Automatically updated, the up-to-date twin mitigates the risk of propagating misinformation and subsequent errors and delays. Easily accessible from a browser, the twin acts as a window for remote stakeholders into detailed project information at every stage of the decommissioning program. This facilitates collaboration across disciplines and speed up decision making, which can ease bottlenecks and avoid delays.

The visualization of risks through simulation and actions taken to mitigate hazards can provide insurers and underwriters with a clearer understanding of the risks and control measures being taken. A greater understanding of the decommissioning project may help in driving down premiums. Insurers have suggested such increased visibility could remove a zero from the cost of premiums.

How FutureOn can help

 Our software is fully cloud-based and can be accessed via Edge, Safari and Google Chrome, making asset data and project designs accessible to all members of the engineering team. This high level of accessibility will help speed up decommissioning projects through enhanced information sharing and collaboration.

With its drop drag capabilities, FutureOn’s FieldTwin Design brings real-time collaboration to all aspects of field projects. With the pertinent data easily available, our platforms can be accessed during online meetings with gate-keeping decision makers, which will support quicker and better decision making.

The platform’s intuitive interface enables engineers to quickly create multiple iterations of a project concepts, allowing them to quickly compare and contrast plans to find the optimal and most cost-effective solution to decommissioning.

Contact FutureOn today to find out more about how our digital twin cloud-based platforms can help your company drive down the cost of decommissioning through project optimization.

net zero wind farm

The Role of Digital Twins in Reaching Net Zero Faster

By FutureOn Today

A digital twin raises asset visibility and provides oil and gas offshore operators with the in-depth data insights needed to make evidence-based decisions that will lead to increased efficiency, reduced emissions and accelerate the energy transition.

With the energy transition towards clean energy starting to gain momentum due to mounting global concern over climate change, oil and gas companies are increasingly looking for ways to sustain their revenues whilst getting ahead in the new green energy market.

Poor market performance coupled with much more stringent environmental regulations mean the next few decades aren’t going to be easy for the oil and gas industry unless it starts to rapidly embrace renewable energies and the technologies that will facilitate their decarbonization goals.

Leading oil and gas companies are already demonstrating a strong commitment to moving beyond petroleum, with major oil and gas companies BP, Shell and Total all pledging to meet net zero emissions by 2050. Digitalization will be key for delivering net zero while supporting revenue growth. Digital solutions can vastly improve asset management, data usage, the planning and execution of projects and significantly boost the efficiency of both operations and production.

Digital technologies will be indispensable to delivering cleaner energy

Digital solutions have been around for a while, but they weren’t widely adopted until the oil and gas market started to decline after 2014. This downturn provided the impetus for operators to seek alternative support mechanisms to help keep them afloat. Digital twins have been deployed by oil and gas companies to provide owners/operators with a full picture of their facilities, to help them better understand how each unit is operating.

Now, more advanced digital twin platforms, which are typically cloud-based tools, can offer solutions to digitalize and visualize complex data to create and manage the entire lifecycle of facilities and structures of all complexities for engineering, procurement and construction (EPC) businesses and owners/operators all over the globe.

Digital twin software lets operators see how their facilities are operating in real-time within the context the field and can highlight opportunities for optimization to really get the most value from those assets. Through the use of digital twins, operators can also monitor resource consumption, gauge production efficiency, plan future upgrades or modifications for green energy production, and identify opportunities to lower costs.

Digital twins are destined to become a mainstay of the oil and gas industry, enabling everything from early-stage concept selection through simulation to production optimization and predictive maintenance.

Digitalization will support quicker transitions

 Majors like BP have even shortened their emissions goals to 2030, which means that the investment in and construction of renewable energy assets cannot be delayed. Putting the right digital technologies in place now will not only support today’s existing assets in running cheaper and cleaner but will also support the delivery of future green projects more quickly and efficiently.

Digital twin platforms are a flexible and versatile tool that can be used to deliver a variety of projects. From field planning to asset management, the same digital solution allows users to manage the entire lifecycle of a project from concept through to abandonment and removal.

Whether planning a floating offshore windfarm, deciding well placement or repurposing pipelines for hydrogen gas transportation, digital twins can be applied to number of different scenarios. Companies that are early adopters of digital twins have a competitive advantage over those who are dragging their feet as they will already have the tools and expertise in place to get ahead of their competitors.

Once these new or repurposed assets come online, the digital twin will help drive their operational excellence and support the long-term health of the asset. Greater operational excellence will lead to improved predictive maintenance and scheduling, less downtime, and will enhance the economics and viability of these assets in a low margin environment. Digital twins are no longer a tool for incremental improvement but a transformative technology with huge potential.

To find out more about how FutureOn’s cloud-based digital twin solutions can support your company in achieving its net zero goals or for enquiries about partnership opportunities please contact us or book a demo.

digital twin decision making

Digital Twins Can Drive Efficiency in Decision Making

By FutureOn Today

The oil and gas industry is increasingly deploying digital twin technology to help reduce costs and make operations more sustainable through better decision-making. Gartner predicts that half of major industrial applications will be using digital twins by 2021, potentially increasing their operational effectiveness by 10%.

Over the past decade, the oil and gas market has been on a bit of a white-knuckle and unpredictable rollercoaster ride. The pandemic brought about a demand disruption that no one could have foreseen. Worldwide lockdowns have hastened and exacerbated the downturn in the industry by causing project delays due to supply chain disruptions.

Combined with a nosedive in oil prices and an almost overnight shift to remote working, Covid-19 has heightened the need for companies to adopt a leaner and tighter approach to their operations. Poor supply and weakening demand caused by the pandemic, are pushing oil companies to quickly find innovative solutions to reduce OPEX and CAPEX to maintain cash flows.

Integrated solutions such as, digital twins, can help achieve this by improving overall asset visibility and providing operators with the data they need to make more evidence-based decisions that will have the most significant impact on the bottom-line, whilst boosting long-term operational sustainability.

Digital twins provide answers to hard questions

In a market with rapidly thinning margins and almost no room for error, digital twins are becoming a mainstay piece of software for oil and gas operations. Having a digital twin enables operators to build models that allow them to run simulations of various scenarios quickly and more accurately.

Using the digitally replicated asset or field, project engineers can safely test real-world problems and visualize the results in 3D. Problems can be identified early on, which means project teams can make more informed decisions about how to proceed and thereby minimize the need for costly revisions or project downtime.

From selecting asset materials, estimating project parameters to determining what interventions should be taken, the digital twin makes running these calculations easier, faster and more accurate.

Traditionally, these types of decisions would have been both time and labor intensive for teams, but with the tools provided by a digital twin platform these same processes can be reduced to a matter of days rather than weeks or even months, thus minimizing project delays and massively improving accuracy.

By helping improve the project teams overall understanding of the asset – its operational capacity, lifecycle history, reliability and structure –teams are better able to optimize asset performance, extend the shelf life of an asset and generate more value for the business.

A digital twin lets you see the asset in the here and now

The technology surrounding digital twins has advanced rapidly over the years, now thanks to connected IoT sensors, big data, machine learning, cloud-computing and 3D modelling digital twins can do more than ever before.

Today’s digital twins allows users to understand and see what’s happening with the physical asset in the present and make data-based predictions about its operation and maintenance in the future. Automatically updated in real-time, a digital twin acts as a repository for a single source of digital truth that threads through the asset’s lifecycle.

This ongoing archive of project data can help assist in the efficient planning and execution of inspection and maintenance activities, facilitate the safe incorporation of future modifications, reduce the future cost of decommissioning, help ensure that facilities meet new operational standards, and even speed up the handover and sign-off of an asset to another operator.

How FutureOn digital twins improve decision making

FutureOn’s digital twin software speeds up and enhances decision making by enabling operators to unlock the power of their data, which could potentially save their business billions in capital through improved efficiencies and enhanced safety.

Our platforms continuously gather and translate complex project data into highly detailed 3D visual representations of oil and gas assets. Users can upload additional information to the platform e.g. bathymetry data insights directly into their project, allowing them to build a more comprehensive picture of their equipment and its surrounding environment.

This improved visibility allows our customers to create safer and more responsive operating conditions, lower risks and better preserve the integrity of field equipment. It also enables them to present concepts as dynamic data to key decision makers and the proposed modifications can be reviewed in real-time via the platform.

Bringing all project stakeholders together like this via one interactive and easily accessible interface this can help reduce decision making delays and ensures that each department is aligned to overall project goals.

Our technology breaks down data silos, reduces the risk of misunderstandings, improves accessibility and provides universal checkpoints to ensure data validity during the entire project. Early reports show that our software reduces pre-FEED field planning time and investment by at least 60%.

To find out more about how FutureOn’s cloud-based digital twin solutions can help your company use data to power your business decisions or for enquiries about partnership opportunities please contact us or book a demo.

FutureOn

Watch: How To Visualize Your Digital Twin Journey

By FutureOn Today
FutureOn’s VP of EMEA, Andreas Gaarder recently spoke at INFRAWEEK Middle East & Turkey. His talk ‘From concept to operation: How to visualize your Digital Twin journey’ addressed:
  • How FutureOn can drive collaboration by providing an open visual collaboration platform; and
  • How digital field development projects can lead to large gains in project NPV.

Watch the talk here. (Registration required).

Brent Decommissioning Project

Sweating Oil and Gas Assets vs Decommissioning

By FutureOn Today

Advanced visualization software is a powerful tool that can help operators decide whether or not it’s cost effective to continue operating offshore assets or if it’s time to pull the plug.

Decommissioning is an inevitable part of every oil and gas asset’s life. Operators will start thinking about this end-of-life phase as production plateaus, reservoir pressure drops, operational running costs rise and facilities start to degrade. Other issues such as oil demand, the volume of recoverable oil resources, geo-political tensions and energy market outlook will also impact this decision.

Offshore exploration and production investments have been on the decline year by year since the oil price crash in 2014, as operators both scaled down activity and focused on cutting costs in an effort to make projects more robust and commercial following the crash.

According to Rystad Energy, the recent collapse in crude oil demand and prices due to the Covid-19 pandemic has exacerbated the situation further and led to an increased focus on capital discipline and investment cuts. This marked decline combined with the failure of new discoveries to replace production is pushing many operators to consider “sweating” their existing assists rather than writing them off.

Decommissioning eats into profits and spending on innovation 

Oil and gas facilities are expensive and complex structures, they represent a huge investment for the operator. Naturally, the longer they run and more productive they are, the better the ROI for the operator. Decommissioning is a lengthy and capital intense project that diverts cash and human resources away from revenue growth areas of the business.

Increased spending on decommissioning may limit the room for operators to invest in other segments such as exploration, development and enhanced oil recovery projects. Arne Sigve Nylund, executive vice president for Development and Production Norway at Equinor said: “Field life extension is an excellent way of managing resources as it creates high value from established fields, where we co-operate with our suppliers on safe operation and lower emissions every single day.”

Oil and gas operators are also under additional pressure to reduce their emissions. Prematurely retiring assets and tearing up the seabed for new projects will only increase their carbon footprint and damage their reputation in the eyes of both the public and investors who are increasingly anxious about climate change.

Existing oil and gas facilities are also ripe for repurposing for renewable energy e.g. carbon capture, electrification, hydrogen transportation and storage, if operators remove infrastructures from the ocean they will miss out on this opportunity to capture green revenue.

Converting assets for green energy will not only support the energy transition and decarbonization goals, it will also free up a significant amount of capital that can be redirected more efficiently and help operators get the most value out of their on-going projects.

Operators need to shift their mind-set towards intervention

Traditionally, intervention has been viewed as a costly measure that typically only occurs when problems arise that are severe enough to significantly impact production. By only addressing issues post-failure or after production has massively declined, operators do not get much value from their intervention – deferred production and unplanned costs for remediation can quickly add up. As a result, many operators are slightly jaded when it comes to the concept of intervention.

Oil and gas operators should view life extension intervention as a means to securing optimally consistent performance. To get the most value from life extension and optimization measures, operators should adopt a more proactive approach to asset operation and maintenance.

Proactive intervention should be viewed as a means to securing increased operational excellence, optimal consistent performance and greater predictability. On-going incremental improvements are cheaper than a reactionary response to a disaster. Oil and gas assets are expensive and complicated installations that exist in harsh offshore conditions, so for the sake of health and safety it’s better to nip problems in the bud before they evolve into something much more serious.

Leveraging digital innovation to extend field and asset life

Rystad Energy estimates that of the 3,000 oil and gas fields producing today, 50% could still be producing in 2030 due to improved depletion rates through the use of advanced technology. Innovative technologies, such as IoT sensors and digital twins, can be applied to workflows, data and operations across the value chain to maximize efficiency, which will help drive down overall costs without compromising outcome.

The digital maturation of the oil and gas industry is enabling operators to amplify the results of interventions through the application of advanced technologies. A minor increase in production performance or recovery can yield a significant increase in value generation.

Laser scanning and sophisticated tagging systems enable project engineers to create a clear 3D visualization of a field or asset, accurate-to-the-millimetre as it’s built, no matter how different from the original design. With these models, engineers are then better able to design and test new infrastructure or planned modifications to determine the best course of action whilst onshore.

These detailed and interactive visuals can also help teams to understand the context for their operations and the limits of their equipment e.g. the amount of weight a structure can carry, the support needed to make a structure stable or space restrictions. This will also help determine how suitable assets are for green energy modifications. The digital twin can also be used to test alternative what-if scenarios and support teams in making decisions that will ensure the site works better for longer.

To find out more about how FutureOn can help your company digitalize your operation or for enquiries and partnership opportunities please  contact us or book a demo.