Big Data in Big Oil: How Shell Uses An­a­lyt­ics To Drive Busi­ness Suc­cess

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The oil and gas in­dus­tries are fac­ing ma­jor chal­lenges – the costs of ex­trac­tion are ris­ing and the tur­bu­lent state of in­ter­na­tional pol­i­tics adds to the dif­fi­cul­ties of ex­plo­ration and drilling for new re­serves. In the face of big prob­lems, its key play­ers are turn­ing to Big Data in the hope of find­ing so­lu­tions to th­ese press­ing is­sues.

Big Data is the name used to de­scribe the the­ory and prac­tice of ap­ply­ing ad­vanced com­puter anal­y­sis to the ev­er­grow­ing amount of dig­i­tal in­for­ma­tion that we can col­lect and store from the world around us. Over the last few years busi­nesses in ev­ery in­dus­try have en­thu­si­as­ti­cally de­vel­oped data-led strate­gies for over­com­ing prob­lems and solv­ing chal­lenges, and the oil and gas in­dus­tries are no dif­fer­ent.

Royal Dutch Shell is one of the largest oil and gas com­pa­nies – one of the “su­per­ma­jors” which also in­clude BP, Chevron, To­tal and ExxonMo­bil – and the world’s fourth largest com­pany by rev­enue. For some time now it has been de­vel­op­ing the idea of the “data-driven oil­field” in an at­tempt to bring down the cost of drilling for oil – the in­dus­try’s ma­jor ex­pense.

A re­cent sur­vey by Ac­cen­ture and Mi­crosoft of oil com­pa­nies and those in­volved in the sup­port in­dus­tries found that 86% to 90% of re­spon­dents said that in­creas­ing their an­a­lyt­i­cal, mo­bile and In­ter­net of Things ca­pa­bil­i­ties would in­crease the value of their busi­ness. The search for new hy­dro­car­bon de­posits de­mands a huge amount of ma­te­ri­als, man­power and lo­gis­tics. With drilling a deep wa­ter oil well of­ten cost­ing over $100 mil­lion, no one wants to be look­ing in the wrong place.

Sur­vey­ing of po­ten­tial sites in­volves mon­i­tor­ing the low fre­quency seis­mic waves that move through the earth be­low us due to tec­tonic ac­tiv­ity. Probes are put into the earth at the spot be­ing sur­veyed, which will reg­is­ter if the pat­tern of the waves is dis­torted as they pass through oil or gas.

In the past this would in­volve tak­ing a few thou­sand read­ings dur­ing the typ­i­cal sur­vey of a po­ten­tial drilling site. But in the past few years tech­nol­ogy has ad­vanced to the level where it could in­volve more than a mil­lion – vastly in­creas­ing the amount of data gath­ered dur­ing ex­plo­ration.

Shell uses fi­bre op­tic ca­bles, cre­ated in a spe­cial part­ner­ship with Hewlett-Packard, for th­ese sen­sors, and data is trans­ferred to its pri­vate servers, main­tained by Ama­zon Web Ser­vices. This gives a far more ac­cu­rate im­age of what lies be­neath. Data from any prospec­tive oil field can then be com­pared along­side that from thou­sands of oth­ers around the world, to en­able ge­ol­o­gists to make more ac­cu­rate rec­om­men­da­tions about where to drill.

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