Commentary, 3/4 2014

Published Apr 24, 2014
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Cover, 3/4 2014

Technology Incubator

As this issue reaches our readers, it’s only a short time before the offshore oil and gas industry comes together in Houston for the Offshore Technology Conference. OTC is really about technology, and one of the noteworthy features of the event is the international pavilions – especially those from the North Sea region.

It’s been about a century since the first wells were drilled along the US gulf coast shores of Texas and Louisiana. Yet it was the 1930s that saw the development of the first mobile steel barges for drilling in the coastal areas of the Gulf of Mexico. And decade-by-decade, the industry refined its methods for extracting oil from deeper and deeper waters.

So the industry had already come a long way when pioneering days of oil activities began in the North Sea.

As the industry began to explore the UK and Norwegian Continental Shelf, technologies that had been developed for Gulf of Mexico waters were adapted to the special needs of the North Sea. And this need for adaptation lead to innovations that have since evolved and been applied globally.

It’s not surprising that technology has flowed in both – as well as in all – directions. The nature of engineering is continuous improvement, and “innovation” is engineering shorthand for “I think this would work better if we were to…”. So the North Sea pavilions from Norway, the UK and Scotland serve as proof of this continuous technology refinement.

But while that technology moves forward, it’s often met with some resistance. When billions of dollars are at stake, operators are generally not willing to serve as a guinea pig for unproven technologies. The phrase “the race to be second” is often used as a description of this unwillingness.

Fortunately, here in the North Sea, both the Norwegian and UK governments have done much to encourage the development as well as the implementation of new technologies. Both governments recognise the contribution the oil and gas sector has made to their economies, and both see the benefit of encouraging developments that improve recovery rates. The support has been two-fold. While there are financial incentives, perhaps more important has been the backing of technology development.

Here in Norway, we’ve had two iterations of the Petromaks programme, funded via the Research Council of Norway. The success of Petromaks – RCN’s large-scale programme for the optimal management of petroleum resources – has led to Petromaks 2, which continues to pursue these goals. Both generations of Petromaks have funded and encouraged strategic basic research, knowledge and competence building, applied research, and technology development with the aim of increasing recovery and extending the lifespan of NCS activities.

Likewise, the UK government has a clear oil and gas industrial strategy. The UK’s PILOT programme goals include enhanced and increased oil recovery (EOR and IOR) as well as supporting infrastructure access and exploration success – all with the aim of ensuring that oil and gas activities continue for decades to come.

A key PILOT goal is improved technology uptake, which has also been a concern in Norway. The result of this government encouragement is that many technologies have been given a chance to succeed, mitigating the “race to be second” mind-set.

So North Sea governments have played an active role and have worked as partners to develop innovation that not only increases value in terms of oil and gas production, but as innovation that can be exported to other offshore regions. We now see that technologies developed in the North Sea have found new markets in offshore Asia and Australia – as well as in the Americas.

The successful partnership should not be taken for granted. Continued and increasing support and encouragement must be a priority.

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