Is rig automation just a fancy word?

Rig automation is not a new subject, especially in the offshore environment. The automation is delivered by rigs in different forms: manless rig floor, dynamic positioning, drill pipe handling, case running, control of directional drilling tools, etc. Many offshore facilities will need fewer people and, in some cases, none at all. By reducing the number of people on the platform, it will be possible to also reduce the size of the facility, the accommodation and other supporting assets. This would also reduce human errors and number of incidents, thus, help operators and rig companies improve their safety statistics.

Rise of rig automation

During the downturn, automation became a key subject in the offshore drilling as companies looked to reduce costs and headcounts. It was already underway, but downturn accelerated it. In its latest Technology Outlook report, risk management company DNV GL highlighted fully autonomous drilling as a technology it expects oil and gas companies to implement by 2025. The technology has well-known safety and cost benefits, so why is not already an established industry standard? As the commodity price finally recovers, will the industry continue investing in rig automation?

Why and why not automation?

In order to answer the above questions, we need to dig a bit more into the advantages and disadvantages of rig automation, and factors the automation depends on.

Experts are divided by their views on the future of automated systems: some see a generation of mostly autonomous rigs while others say that, in the near future, rigs will most likely be controlled remotely by drillers, geologists, and engineers working in office buildings rather than in the field, and on several wells at once. 

While downturn became a catalyst to increase automation-related investment, it is also a reason for the reduction of investment into this, as capital is limited and not many new rigs are built today. So, one would argue that automation is not attractive when capital exists and not feasible without funding. There is a middle ground, though. Systems are currently evolving to turn drillers and rigs into partially automated systems, giving drillers the ability to take control if they need to. In this scenario, new fleets of rigs do not need to be created, but existing fleets will be retrofitted. Automation is also a key to successful drilling of more complex wells: longer laterals, higher pressures. As seen on the graph below, the well complexity is driving to squeeze all the rig and drilling tool capabilities’ out.

Source: IHS, 2019

Also, it’s not only about the cost to drill but also about the reduced impact on rig personnel. Less personnel means reduced number of incidents and human errors.

Improved ROP, lower NPT, reduced to no people on rig floor are some benefits of integration and automation. 

While expensive deepwater rigs have advanced automation features, there are still challenges to designing such a system for land rigs. A land system must be compact, readily portable, relatively low cost to build and operate, and sufficiently rugged to withstand frequent transport. Nabors has acquired directional drilling, MPD and casing running service companies to integrate them into their rig services and automate where possible, and they are doing a pretty good job in this integration. PD, among others, is also making an effort to add more services to their rig services with the intention to integrate and automate services. Improved ROP, lower non-productive time, reduced to no people on rig floor are some benefits of this integration and automation. 

While the automation of onshore rigs is mainly led by rig companies, in the offshore space, supermajors make a bigger progress. Shell, BP, Chevron, all are big investors in automated offshore systems. While, they are also impacted by downturn, they will likely continue leading the effort. It’s not only cost, performance, safety but also the reputation of a leader that drives automation for these companies.

Who are the winners?

Companies, that are developing technologies in alignment with software capabilities and other market trends, are the winners.

The oil and gas drilling industry is currently led by advanced physical technologies but the change towards implementation of software as a success enabler has already started. Machine learning, artificial intelligence are being slowly introduced into the industry. This trend will continue and the role of software in the industry will increase. Those companies that are developing technologies in alignment with software capabilities and other market trends are the winners. Being aware of market needs, trends, ability to reach out to customer to collect info and market their innovations are the vital pre-requisites for success in this competitive industry. 

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