The Oil and Gas industry is going through ‘the Great Crew Change’ which means the dominant experienced generation will pass on the baton to the millennials over the next few years. Premiums are placed on a newer generation to assume increasing job responsibilities without compromising on the safety and quality. However, the traditional approach of classroom sessions and on-the-job training will not be enough to deliver in-sync to the expectation. The training must be amplified with advanced technologies like Augmented Reality (AR) and Virtual Reality (VR) that enhances the workforce's knowledge and confidence.
Visualization is one of the greatest abilities of humankind, and with the advancement of computing technology, this concept has been translated as Augmented and Virtual Reality. In the high-risk setup like construction, military, aviation or energy, the visualization techniques can combat the future risks and can even save lives.
The oil and gas industry has introduced AR/VR Immersive Training Systems, which is a 3D engineering tool that connects control room operators, maintenance, and field personnel in a single realistic simulated learning environment. The system also allows to capture and retain operational knowledge and technical expertise during the replacement of the experienced operators with the new workforce. It ensures safety and unhindered plant operation and performance.
Augmented Reality (AR) in the oil and gas sector provides a visual view of the system along with the digital information. It provides graphics, real-time data, and feedback. Field engineers can also perform maintenance task by using AR informative graphics, resulting in the better assessment of the issues and reduced downtimes. It can also be used in the monitoring of the critical equipment for preventive and corrective maintenance in rigs, exploration and production units. It is a great tool for on-the-job training and keeping your workforce updated with latest learnings.
Virtual reality (VR) simulation mimics the real-world scenario. The user can interact with the elements and can even perform tasks virtually through sensory experience. This is one of the best learning tools for the upcoming generation. It enables them to learn about the oil reservoir, rigs, and other equipment in a life-like setting, without being physically present in the hazardous environment. They can also learn about the possible hiccups and the ways to combat them. By using 3D immersive technology, one can zoom in and zoom out the viewing model and can compare the expected system with the actual to learn more about the deviation. Even the real-life mock-ups can be created to train the workforce better.
Benefits of training
· Fast commissioning and start-up time
With the real-world plant training of the operators, supervisors, managers, field engineers, and maintenance staff the company can minimize the project risk considerably and prevent delays due to plant commissioning and start-up.
· Save cost on Infrastructure
The cost of training your personnel in real setup means a huge expenditure for the company in providing the facility, training staff, and equipment. However, with simulations, the personnel can easily learn to operate, manage and maintain the equipment without any expenses on infrastructure. The technology can also assist in case-study of oil drilling platforms, processing plants, rigs, refineries, which comprises of the most complex machinery and process.
· Fast and efficient training
The real-time training requires long duration due to a mix of the classroom session, on-the-job training, plant or site visit. However, VR offers the same level of training without much movement and expenditure in considerably less time. Thus the simulated learning system makes the training process highly reliable, sustainable, efficient, effective, and pocket-friendly.
· Compliance with safety parameters
3D models simulate the real work conditions and enhance the understanding level of the workers and equip them to deal with any risks or unsafe situations and ensure adherence to the safety compliances.
· Improve first-time fix rates
The upstream segment is usually located in the remote or offshore location which means the cost of installation and maintenance is high due to accessibility issues. The technicians can be trained about the facilities in advance before reaching to perform periodic maintenance and first-time fixes.
· Conduct primary diagnosis
AR/VR platform aided with the integration from the sensor's operating system can provide historical data about the facilities and help to conduct training that enables the technician to make an informed decision. The engineer learns to conduct a first-level diagnostic and ascertain the extent of the problem before reaching the site.
The future of Augmented and Virtual reality is moving beyond the ‘virtual view’ to a more ‘data-oriented virtual view’. The idea is to obtain relevant historical and real-time data via enterprise system or IoT- based system to deal with any system error or failure. When the personnel is trained using the simulation and 3D models they are better equipped to deal with real-time situations and can help in creating innovative solutions at a fraction of cost.
The real time training requires long duration due to a mix of classroom session, on-the-job training, plant or site visit. However, VR offers the same level of training without much movement and expenditure in considerably less time. Thus the simulated learning system makes the training process highly reliable, sustainable, efficient, effective, and pocket-friendly.
3D models simulate the real work conditions and enhances the understanding level of the workers and equips them to deal with any risks or unsafe situations and ensures adherence to the safety compliances.
The upstream segment is usually located in the remote or offshore location which means the cost of installation and maintenance is high due to accessibility issues.The technicians can be trained about the facilities in advance before reaching to perform periodic maintenance and first-time fixes.
AR/VR platform aided with the integration from operational system can provide historical data of the facilties and help to conduct training that enable the technician to make informed decision. The engineer learns to conduct a first-level diagnostic and ascertain the extent of problem before reaching the site.
The future of Augmented and Virtual reality is moving beyond the ‘virtual view’ to a more ‘data-oriented virtual view’. The idea is to obtain relevant historical and real-time data via enterprise system or IoT- based system to deal with any system error or failure. When the personnel are trained using the simulation and 3D models they are better equipped to deal with real-time situations and can help in creating innovative solutions at a fraction of cost.
Something interesting to share?
Join NrgEdge and create your own NrgBuzz today
In a few days, the bi-annual OPEC meeting will take place on November 30, leading into a wider OPEC+ meeting on December 30. This is what all the political jostling and negotiations currently taking place is leading up to, as the coalition of major oil producers under the OPEC+ banner decide on the next step of its historic and ambitious supply control plan. Designed to prop up global oil prices by managing supply, a postponement of the next phase in the supply deal is widely expected. But there are many cracks appearing beneath the headline.
A quick recap. After Saudi Arabia and Russia triggered a price war in March 2020 that led to a collapse in oil prices (with US crude prices briefly falling into negative territory due to the technical quirk), OPEC and its non-OPEC allies (known collectively as OPEC+) agreed to a massive supply quota deal that would throttle their production for 2 years. The initial figure was 10 mmb/d, until Mexico’s reticence brought that down to 9.7 mmb/d. This was due to fall to 7.7 mmb/d by July 2020, but soft demand forced a delay, while Saudi Arabia led the charge to ensure full compliance from laggards, which included Iraq, Nigeria and (unusually) the UAE. The next tranche will bring the supply control ceiling down to 5.7 mmb/d. But given that Covid-19 is still raging globally (despite promising vaccine results), this might be too much too soon. Yes, prices have recovered, but at US$40/b crude, this is still not sufficient to cover the oil-dependent budgets of many OPEC+ nations. So a delay is very likely.
But for how long? The OPEC+ Joint Technical Committee panel has suggested that the next step of the plan (which will effectively boost global supply by 2 mmb/d) be postponed by 3-6 months. This move, if adopted, will have been presaged by several public statements by OPEC+ leaders, including a pointed comment from OPEC Secretary General Mohammad Barkindo that producers must be ready to respond to ‘shifts in market fundamentals’.
On the surface, this is a necessary move. Crude prices have rallied recently – to as high as US$45/b – on positive news of Covid-19 vaccines. Treatments from Pfizer, Moderna and the Oxford University/AstraZeneca have touted 90%+ effectiveness in various forms, with countries such as the US, Germany and the UK ordering billions of doses and setting the stage for mass vaccinations beginning December. Life returning to a semblance of normality would lift demand, particularly in key products such as gasoline (as driving rates increase) and jet fuel (allowing a crippled aviation sector to return to life). Underpinning the rally is the understanding that OPEC+ will always act in the market’s favour, carefully supporting the price recovery. But there are already grouses among OPEC members that they are doing ‘too much’. Led by Saudi Arabia, the draconian dictates of meeting full compliance to previous quotas have ruffled feathers, although most members have reluctantly attempt to abide by them. But there is a wider existential issue that OPEC+ is merely allowing its rivals to resuscitate and leapfrog them once again; the US active oil rig count by Baker Hughes has reversed a chronic decline trend, as WTI prices are at levels above breakeven for US shale.
Complaints from Iran, Iraq and Nigeria are to be expected, as is from Libya as it seeks continued exemption from quotas due to the legacy of civil war even though it has recently returned to almost full production following a truce. But grievance is also coming from an unexpected quarter: the UAE. A major supporter in the Saudi Arabia faction of OPEC, reports suggest that the UAE (led by the largest emirate, Abu Dhabi) are privately questioning the benefit of remaining in OPEC. Beset by shrivelling oil revenue, the Emiratis have been grumbling about the fairness of their allocated quota as they seek to rebuild their trade-dependent economy. There has been suggestion that the Emiratis could even leave OPEC if decisions led to a net negative outcome for them. Unlike the Qatar exit, this will not just be a blow to OPEC as a whole, questioning its market relevance but to Saudi Arabia’s lead position, as it loses one of its main allies, reducing its negotiation power. And if the UAE leaves, Kuwait could follow, which would leave the Saudis even more isolated.
This could be a tactic to increase the volume of the UAE’s voice in OPEC+, which has been dominated by Saudi Arabia and Russia. But it could also be a genuine policy shift. Either way, it throws even more conundrums onto a delicate situation that could undermine an already fragile market. Despite the positive market news led by Covid-19 vaccines and demand recovery in Asia, American crude oil inventories in Cushing are now approaching similar high levels last seen in April (just before the WTI crash) while OPEC itself has lowered its global demand forecast for 2020 by 300,000 b/d. That’s dangerous territory to be treading in, especially if members of the OPEC+ club are threatening to exit and undermine the pack. A postponement of the plan seems inevitable on December 1 at this point, but it is what lies beyond the immediate horizon that is the true threat to OPEC+.
Submit Your Details to Download Your Copy Today!
In the U.S. Energy Information Administration’s (EIA) November Short-Term Energy Outlook (STEO), EIA forecasts that U.S. crude oil production will remain near its current level through the end of 2021.
A record 12.9 million barrels per day (b/d) of crude oil was produced in the United States in November 2019 and was at 12.7 million b/d in March 2020, when the President declared a national emergency concerning the COVID-19 outbreak. Crude oil production then fell to 10.0 million b/d in May 2020, the lowest level since January 2018.
By August, the latest monthly data available in EIA’s series, production of crude oil had risen to 10.6 million b/d in the United States, and the U.S. benchmark price of West Texas Intermediate (WTI) crude oil had increased from a monthly average of $17 per barrel (b) in April to $42/b in August. EIA forecasts that the WTI price will average $43/b in the first half of 2021, up from our forecast of $40/b during the second half of 2020.
The U.S. crude oil production forecast reflects EIA’s expectations that annual global petroleum demand will not recover to pre-pandemic levels (101.5 million b/d in 2019) through at least 2021. EIA forecasts that global consumption of petroleum will average 92.9 million b/d in 2020 and 98.8 million b/d in 2021.
The gradual recovery in global demand for petroleum contributes to EIA’s forecast of higher crude oil prices in 2021. EIA expects that the Brent crude oil price will increase from its 2020 average of $41/b to $47/b in 2021.
EIA’s crude oil price forecast depends on many factors, especially changes in global production of crude oil. As of early November, members of the Organization of the Petroleum Exporting Countries (OPEC) and partner countries (OPEC+) were considering plans to keep production at current levels, which could result in higher crude oil prices. OPEC+ had previously planned to ease production cuts in January 2021.
Other factors could result in lower-than-forecast prices, especially a slower recovery in global petroleum demand. As COVID-19 cases continue to increase, some parts of the United States are adding restrictions such as curfews and limitations on gatherings and some European countries are re-instituting lockdown measures.
EIA recently published a more detailed discussion of U.S. crude oil production in This Week in Petroleum.
The U.S. Energy Information Administration (EIA) forecasts that members of the Organization of the Petroleum Exporting Countries (OPEC) will earn about $323 billion in net oil export revenues in 2020. If realized, this forecast revenue would be the lowest in 18 years. Lower crude oil prices and lower export volumes drive this expected decrease in export revenues.
Crude oil prices have fallen as a result of lower global demand for petroleum products because of responses to COVID-19. Export volumes have also decreased under OPEC agreements limiting crude oil output that were made in response to low crude oil prices and record-high production disruptions in Libya, Iran, and to a lesser extent, Venezuela.
OPEC earned an estimated $595 billion in net oil export revenues in 2019, less than half of the estimated record high of $1.2 trillion, which was earned in 2012. Continued declines in revenue in 2020 could be detrimental to member countries’ fiscal budgets, which rely heavily on revenues from oil sales to import goods, fund social programs, and support public services. EIA expects a decline in net oil export revenue for OPEC in 2020 because of continued voluntary curtailments and low crude oil prices.
The benchmark Brent crude oil spot price fell from an annual average of $71 per barrel (b) in 2018 to $64/b in 2019. EIA expects Brent to average $41/b in 2020, based on forecasts in EIA’s October 2020 Short-Term Energy Outlook (STEO). OPEC petroleum production averaged 36.6 million barrels per day (b/d) in 2018 and fell to 34.5 million b/d in 2019; EIA expects OPEC production to decline a further 3.9 million b/d to average 30.7 million b/d in 2020.
EIA based its OPEC revenues estimate on forecast petroleum liquids production—including crude oil, condensate, and natural gas plant liquids—and forecast values of OPEC petroleum consumption and crude oil prices.
EIA recently published a more detailed discussion of OPEC revenue in This Week in Petroleum.