If there is one setback that creeps in the back of every operator’s mind, it’s equipment failure. All other conditions aside, such as rig scheduling, weather delays, market dynamics, etc., equipment failures can be the most time-consuming and cost-intensive interruptions to well profitability by far. In fact, the estimated cost of an ESP failure in the Permian basin can add up to $180,000 regardless of the root cause.1 While run time expectations have always been top of mind for ESP operators, the complex production environments of horizontal plays have raised the stakes. Not only is equipment running in harsher, more dynamic conditions, but the pressure is also on for producers as stakeholder expectations and CAPEX budgets push for higher returns in shorter timeframes.
Fortunately, new applications and appreciation for data have expanded the ways that operators and service companies can overcome these barriers. Traditionally, the onus of optimization has been on the service company, and this has been very effective for several reasons. If the service company has the right experience and technical knowledge, they can monitor SCADA and analyze real-time performance trending to raise a red flag if trips or faults signal “DANGER” ahead, delivering proactive recommendations to the operator before a piece of equipment fails (case in point). This takes some of the pressure off the production engineer and requires less oversight from the operator, allowing them to dedicate resources elsewhere.
Why You Can’t Rely On Equipment Data Alone
However, in order to predict and make preemptive decisions based on how the system will perform 2 weeks, 3 months, or 1 year from now, equipment data alone isn’t enough. Without understanding what’s really going on below the surface, operators and service companies are working blind in one eye.
By coupling data from downhole monitoring equipment with production rates, gas content, and water cuts, operators and service companies can see both sides of the picture. This dual visibility can result in longer uptime and fewer equipment failures by helping production engineers make smarter, more informed decisions and intervene well before any signs of failure take place. While optimization strategies are often unique to each operator’s cash flow requirements and production philosophies, those who do choose to share real-time data with their service companies are empowered to capitalize on opportunities to reduce their cost of ownership.
Building The Bridge
If the cost-saving potential of collaborative data-sharing comes at no additional expense to the operator, why is this practice not business-as-usual? For one, production data is immensely valuable and private for many producers, especially in today’s competitive landscape. However, it’s also true that a service company’s ability to optimize performance and save money for their customers will always be capped at the equipment level if the discussion around well data is never addressed. While it may never truly be second-nature, service companies and operators can work together to understand both sides of the data and lay the groundwork for more transparent partnership. Maybe, just maybe, we can break through the data ceiling together.
Interested in reading more about this? Check out our article from the November issue of EIA Magazine: Critical Data Sharing Unlocks Cost-Saving Potential
- Ortega, M. and Williams, J. (2019, June). Extending ESP Service Life in Unconventional Wells. World Oil. Retrieved from:https://www.worldoil.com/magazine/2019/june-2019/special-focus/extending-esp-service-life-in-unconventional-wells