Pemex Uses Data Management as a Vital Part of Decision Making in the Oil Patch

The E&P arm of Mexican state oil company Pemex faced the same challenge as many upstream oil and gas companies—large amounts of valuable data, tedious methods for managing it, and employees across the company struggling to access, share, and analyze historical and current data to make timely, well-informed decisions. Pemex E&P also shared the goal most similar companies have to optimize production and reserves from its oil and gas fields. Its objective was to find a solution that included a scalable, secure way to manage and track valuable data; manage systems connected to the data and to each other; and develop effective work processes so that people could use data as needed in their daily work.

Experts at the E&P subsidiary, which manages approximately 70 onshore and offshore rigs in southern Mexico, questioned whether spreadsheets were the most effective way to manage rig activities. Spreadsheets are commonly used to estimate production, track assets, and perform other important oil and gas functions. The spreadsheet is a great tool in many situations—and much more effective than its predecessor, the map. But in situations involving large volumes of data, oil and gas companies are seeking ways to analyze and modify their processes to ensure optimum performance with minimal production and operations interruptions.

As the firm continued to add activities, the spreadsheet also greatly expanded in size and complexity. The company’s planning group, business units, and drilling-services organization jointly maintained a complex 50- to 60-column spreadsheet containing drilling, financial, and technical information and the various geological, engineering, and other information needed to plan and coordinate activities for each rig. Each business unit (asset) used the spreadsheet to add its prospects and compete for scarce and valuable resources. The drilling-services organization used the spreadsheet to schedule, deploy, and organize rig activities, and it was the planning group’s source for allocating funds to create the right balance between internal supply and demand.

A group of engineers and planners from the three groups recreated the spreadsheet approximately every 6 weeks to reflect ongoing activities, maintenance, new requirements, changing budgets and schedules, and various other fluctuations. Recreating each spreadsheet took up to 6 days and required tedious attention to detail to capture the cascading effect each change had on other activities. Printed reports were so large that they filled an entire wall. For a single moment, people had a snapshot of the current view from which to make critical decisions. By the next day it might be obsolete.

Real-Time View of Rig Activities

In late 2005, Pemex implemented a new Web-based software application to schedule and manage all of its drilling-rig activities. Teams used the old spreadsheet in parallel with the new system for 6 months to catch any problems and then retired the spreadsheet. The company has completed a full year of drilling activity using this system, including quarterly and annual programs, and has planned the 2007 program using the new system.

Now, through the system, users check rig availability and assign rigs to specific wells and tasks, creating user-generated scenarios. They now can easily rank and evaluate a variety of scenarios by use of performance indicators such as incremental production and reserves and well profitability. The system is updated in real time, capturing and reflecting prevailing conditions. It also assists with planning, service requirements, and equipment provisioning for drilling rigs, trucks, or other heavy equipment. For instance, if a drilling permit is delayed or funds are reallocated, teams can adjust planning scenarios.

Asset teams enter demand, drilling teams update the supply side, and planners add budget information to give an accurate, synchronized, and complete snapshot of the entire drilling program—whether activities are on, behind, or ahead of targeted budgets and schedules. An interactive Gantt chart further provides the capability to enter and update activities schedules. Information is shared on daily reports, and management can track activity status almost to the hour.

Connected Systems Improve Decisions

While reworking the spreadsheet, the team realized that valuable data could not remain isolated. Over the past 10-plus years, the firm also has focused on integrating more than a dozen separate systems to create a network that connects its drilling supply chain. Systems that track budget, production forecasting, daily drilling reports, permits, and other aspects related to the maintenance, scheduling, and operations of more than 70 rigs are now connected and synchronized, giving real-time access to all of these data.

The company’s three most critical systems are those that handle production forecasting, drilling operations, and budgeting. For example, if a rig is on a well longer because of unforeseen drilling problems or reaches its targeted depth earlier, the forecast and budget are affected. With these systems now connected, updates are available as they occur. With more reliable data, employees have adopted a new workflow that has streamlined and improved decision making and also has had a positive impact on their time availability for critical activities.

The real industry issue consists of having the right systems and processes in place to manage assets effectively and optimize their capacity to meet supply and demand. Upstream companies can realize the strongest impact by integrating systems and processes so that people have real-time insight to make the best and most informed technical and business decisions. Optimizing operations and reacting to unexpected events require good data. Unfortunately, data themselves are not enough, as most companies will attest. Oil and gas companies have spent billions of dollars generating, collecting, storing, and managing data, much of which cannot be found or accessed, much less effectively used. Complicating matters are the real-world issues of disparate computer systems and databases, global operations and remote offices, and data stored in personal files and hard drives. As a result, when decisions are pending and specific data are needed, they often are not there.

Integrating data does not always mean migrating data to a central repository or creating a master data store. It can be achieved by using the most effective technologies available to access and organize data from where they already are stored and managed. Technical data and documents are combined in context with familiar business objects, such as wells, fields, and reservoirs. More importantly, by combining sound information-management practices, processes, and people, the technology creates a framework that ensures data quality and, ultimately, good decisions.

Information provided by Barry Irani, President and Chief Executive Officer of The Information Store.