Deep water, gas, and 'digitalization' emphasized at OTC

The 33rd annual Offshore Technology Conference in Houston this week focused on the industry's movement into ultradeepwater operations beyond 5,000 ft, its growing emphasis on natural gas, and the accelerated "digitalization" of upstream operations through computer interconnections, said Wolfgang E. Schollnberger, chairman.


Sam Fletcher
OGJ Online

HOUSTON, May 3 -- The 33rd annual Offshore Technology Conference in Houston this week emphasized the industry's movement into ultradeepwater operations beyond 5,000 ft., its growing emphasis on natural gas, and the accelerated "digitalization" of upstream operations through computer interconnections, said Wolfgang E. Schollnberger, chairman.

The trend toward deeper exploration and development was evident in the evolution of wellheads, blowout preventers, risers, and other equipment displayed at the oil and gas industry's biggest conference and exhibition. Much of that equipment is designed to address the problems of drilling in water depths where the weight of the mud column in a 10,000-ft riser could cause a formation to fracture.

The software systems that now control and connect much of that equipment are "about as important as the hardware itself," said Schollnberger, who also is vice-president of technology for BP PLC.

The industry's growing emphasis on natural gas over oil isn't evident in the hardware displays at OTC, because much of the same equipment is used to drill for and produce either oil or gas. However, Schollnberger said he heard more talk of gas in the hallways and on the exhibition floors as well as in the technical papers presented at this year's OTC.

Much of that discussion centered on new gas-to-liquids conversion technology as a means of dealing with gas produced in association with oil from ultradeep water and other remote sites beyond natural gas pipeline infrastructure or local markets "now that flaring is not acceptable," he said.

There also was more discussion of how the industry might develop deposits of gas hydrates found on the ocean floor in many areas of the world. "If we learn how to produce those hydrates, it could be a major energy source," said Schollnberger.

OTC attracted 47,649 participants this year, up from 43,785 in 2000. It's the largest turnout for the annual industry conference since 1998, when 49,641 attended. "That proves that this industry remains very vital," Schollnberger said.

Probably the most surprising visitor was the social activist Rev. Jesse Jackson, who made a quick stop Wednesday to call for inclusion of African-Americans, Hispanics, and women among the industry's executive ranks. "The energy industry should look like the world from where the energy (resources) come," Jackson said.

"I'm glad that Rev. Jackson came because it shows he recognizes OTC as a platform for dialogue," said Schollnberger.

OTC has become more and more international in recent years, with industry participants from 28 countries.

Faced now with a shortage of workers as it tries to ramp up exploration and production to meet a growing global demand for oil and gas, international producers and service companies are recruiting workers from a diversity of cultures worldwide.

"I was extremely encouraged by Dr. Rilwanu Lukman, energy adviser to the president of Nigeria, who talked in his (OTC) keynote address Wednesday of concrete plans to promote democracy in Nigeria and to make that bidding process (for oil and gas concessions) more transparent," Schollnberger said. "If they can manage to do that in Nigeria, other areas would follow."

That should prove the presence of international energy companies, working in a lawful manner, can help improve government and economic operations within a developing country, he said.

Such countries usually insist that energy companies employ mostly local workers and buy goods and services from local providers. But in order for companies to do that, Schollnberger said, a healthy and educated workforce must be available.

"So the host country must have the necessary infrastructure to do that," he said. "That means that the income from its oil and gas resources must be reinvested in ways that help the people.

"It's one of the loops that can work in bringing the wealth from those resources to the people of various countries," Schollnberger said.

Contact Sam Fletcher at samf@ogjonline.com

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