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Mark: Hey, folks let’s learn something new about the oil and gas industry.
All right. Today we’re at the TIBCO Energy Forum in Houston, Texas and I got two very special guests. I have Michael O’Connell and Ted Brown.
So, gentlemen thank you very much for giving me a little bit of your time. So, let’s just jump right into it. So, one of the things that my audience finds fascinating is what they call the digital oil field and it’s what the rest of the world calls the internet of things. Do you want to talk a little bit about TIBCO’s experience in looking at IOT?
Michael: Sure. So, we work in the energy space, we work with upstream, midstream, and downstream companies and all of those companies have data that’s in motion. And we’ve seen over the last, you know, five years or so, equipment that needs to be running around the clock has started to become instrumented and instrumentation with a variety of sensors.
So, we had a presentation today, a guy I was talking about monitoring their electric submersible pumps as part of their artificial lift systems, you know, when there’s not enough pressure for the oil to come out of the ground on its own, you lift that out. And so, in the more lucrative assets they put these electric submersible pumps down in there to push the oil out, you know, fast. And those pumps these days have become instrumented with sensors to measure things like, you know, the temperature of the motor and the pressure or the intake pressure on the pump and, you know, the load and the current and things like that.
So, this particular customer today was talking about managing about 2,500 of these wells that had these electric submersible pumps and the data were coming out of them on a second by second basis. They’re going to telemetry systems that are then pushing that data into history and data bases and we’re picking up the data from those data bases.
Now, that data when it’s being on the ground for a while, you build up a history and when a pump fails or starts to produce load that you might expect it to or shuts down altogether or intermittently cuts out, these are patterns that the engineers have kept track of. And so, we can mind the historical data to find when there’s a pattern like that we can look back what’s in time to find a leading indicator in the sensor data that predicts that pattern.
Now, we can rigorously test that, you know, through the historical data and find the optimal threshold which the pressure might go above a certain amount while the current goes and drops at a certain rate. And we can find combinations of rules and models that predict those stoppages or events of interests and then we can trap those rules and put them on a real time infrastructure
So, you know, just in a side TIBCO has both analytics and event processing software so the patterns that you identify on historical data can be put into action on the real time data. So now, once you’ve determined these on the historical data in Spotfire, you’ve got these rules now up in stream base at our event processing product as the data starts flowing in out from the telemetry systems for the 2,500, you know, pumps that are in the field, you can push them through these rules that you’ve developed in historical data and when the pressure goes above a certain amount combined with the current going below a certain level, you can send a notification.
So, the notification can goes and e-mail to somebody or an entry into a database or a business process management system. You can – we can even launch a root cause analysis with contextual data about the well and its history and all of a sudden the engineer has got in his fingertips something just happened, it’s an anomalous behavior and they’ve got all the context and they can decide how to intervene and stop that part from going down or burning out or keep the oil production at a high level.
There’s a number of use cases in the case study today that were presented some gnarly pictures of pumps that were burned out and this is a high value problem because, you know, with the margin of oil in production area being so tight now with the low prices of oil, you got to make the most of it, you’ve got to have the pumps operating 24/7 to get, you know, oil production flowing and, you know, keep the – keep the margin up. So, we’re able to kind of combine analytics on historical data with real time data sensor data coming off of these devices that are on the internet and monitor them and keep them up and running 24/7.
Mark: Yeah. And so, make sure I understand this right. So what you’re actually impacting with the science is uptime and operational efficiencies. So, you’re driving real dollars, right?
Ted: Absolutely. So, history that TIBCO has within the oil and gas industry specifically with our analytics offering, you know, TIBCO acquired a company called Spotfire in 2007. And initially we were really focused on analytics for data scientist and, you know, enabling kind of what you would expect for maybe Excel replacement charged graphs, you know, kind of rudimentary analytics.
But now, as we’re enabling companies to climb the analytics maturity curve, we’re getting into really huge dollar impacts. We’re, you know, we might tweak one thing where they can monitor proactively a pump or another device that could impact a company for, you know, $50 million a year just because of that one capability that we add. So, it’s exciting.
Mark: Yeah. So, Ted let me ask you this, are you starting to see more of an interest in oil and gas from the business, not IT not the data scientist, but from the business about increasing – at least in science and technology increase efficiencies?
Ted: I mean there’s no doubt about that. You know before everything was basically done on spreadsheets and now as data has become pervasive, data is everywhere. And, you know, you have the kind of younger crew that’s coming on board to oil and gas company so that, you know, they’re used to the immediacy of things having a smartphone in their hand and being able to get out data immediately from a consumer perspective. They now want that within the companies, you know, these large industrial companies are really adapting a much faster time to market for analyzing data and in turn that has these huge dollar impacts that are just, you know, undeniable.
Mark: Yeah. And we think this will be a game changer starting 2016 moving forward, we’ve talked about that in the past.
So, Michael another question for you. So, you know, when you look at big data in the oil and gas industry historically has had big data everywhere, but is the new thing that you bring to the market and the new thing that’s helping business, is it the analytics part to be able to separate the 1% of the big data that’s actually impactful to my business versus the 99% that’s not?
Michael: Well, sure. We do – we look at historical data and we big data sets and we find the outlies, you know, spot the fire and Spotfire is the name of our analytics product and it helps you find anomalies.
Mark: is that where the name came from?
Mark: That’s funny.
Michael: Well, some fires are good that you want to stoke them up, some fires are bad and you want to put them out. And so, finding the outlies and the anomalies is what Spotfire is really good at. It allows you to bring in multivariate data from a variety of sources, mash it up, and then display it in these visually compelling ways that make things jump out to you and you can see there’s an issue over here, let me go find out what’s going on with this.
And that can like I say can be a from a mash up of different data sources or, you know, quite complex big data sources can be brought to bear in an interactive visual analysis and the more variables the better. You know multivariate analysis I think you mentioned, you know, the more the better because Spotfire allows you to have, you know, slide these filters around and color and shape and throw us and, you know, the more dimensions, bring it on as far as that product is concerned. You find these pockets of hotspots and then you can drill down and find out what’s the root cause underneath that.
Now, once you kind of have historical analysis on the big data and you understand where the anomalies are coming from what’s driving them, then you can put those up onto the real time system and monitor from IOT and sensor data those patterns that you’ve discovered on the history you can now apply in real time.
And I think Ted mentioned the notifications and all the millennials, you know, even I’m old guy, but then I pick up my phone, one of the first things I do is I swipe down and see what are my notifications, what meetings have I got to be at or, you know, what’s – so I look at my notifications. Well, notifications that are analytically driven off this equipment, you know, a guy and a young guy in the field swipes the answers out, pump number 33 in location A or whatever is having an issue. I can go fix that or I can depending on the type of issue, I can leave it or whatever.
So the world of like, you know, hyper connectivity and instantaneous notification and action, that’s kind of where we’re at. And that’s kind of lucky that we’re at that because we kind of got to this oversupply of oil and low prices because we’ve created an oversupply of oil. And now, we’re in this digital age where we can kind of deal with it and margin has become so critical, right?
I mean when oil was above $100 a barrel, some pump goes down, I mean who cares? Go drill another hole or whatever, you know, it’s like because money – money is just flowing, but now at $50 or $40, margin, you know, never used to be much of a consideration in E&P and now it really is. And so, kind of keeping the machines up 24/7 and optimizing the flow of oil, you know, that’s how people are, you know, getting competitive advantage these days.
Mark: Yeah. And tell you one thing TIBCO does really well because we’re at their user forum. You all – your customers don’t look at you as vendor, I see it, I saw on the forum. Your customers look at you as partners that’s fantastic, right? You’re actually helping them solve real business issues and they’re bringing you to the table saying, hey, we need some more help.
Ted: Right. Yeah. And so, the Houston Energy Forum, we’ve done this now for thirteen years running and, you know, it started off with the small group of fervent folks that were using Spotfire really getting a lot of value out of it.
And, you know, we recognize from the beginning that sharing those success stories sharing those use cases that are high value like we talked about before, you know we can stand back and have the customers interact with one another and maybe with folks that aren’t using Spotfire or whatsoever and they can get great ideas. And, you know, at this point, it’s really an ecosystem that’s kind of fed upon itself like for example I think we have twelve or thirteen partners that have signed up for participation in this event over the two days here.
You know they’re here bringing their customers on board and, you know, it’s a whole ecosystem where partners are talking to each other, customers are talking to each other, the use cases get more and more innovative and we can kind of stand back and watch it happen and it’s a beautiful thing. It’s really, you know, from a career perspective, Michael and I have been at this for a long time. This is where, you know, you really get some joy out of, you know, how you are making an impact in the world and how you’re, you know, really leaving a legacy behind of what it is that you do.
Mark: Yeah. It feels good to do good work, doesn’t it?
Michael: Yeah. Yeah. I know.
Mark: All right, folks. Well, Ted and Michael, thank you so much for your time. We hope this helped. We will see you next time.