Information life-cycle management in the upstream oil and gas industry

In this white paper, Rick Nicholson, vice president of IDC consultancy company Energy Insights, highlights the importance of information life-cycle management to optimize the use and value of E&P data. The value of exploration and production (E&P) assets varies over their life cycle. At the beginning of the life cycle, during exploration, the assets have a relatively low actual value but a high potential value. During field development, the value increases as hydrocarbon extraction begins. Asset value peaks during production and declines as the assets reach maturity. Exploration and production is a highly information-intensive process, and like the E&P assets themselves, the information has a distinct life cycle with the value of the information varying throughout the life of the associated assets. During exploration, a wide variety of surface and subsurface data is collected to guide the evaluation of reservoirs and selection of drilling locations. Information value increases throughout the exploration phase, in advance of the increase in asset value. In the field development phase, well data is collected and the value of exploration data peaks as production begins. During production, a new set of operations and maintenance data is collected, which, in turn, varies in value along with the life cycle of the assets. If, when a reservoir is in decline, the assets are sold to another company, the value of information once again rises as the new owner evaluates the assets. Current upstream information management practices are typically not aligned with the needs of the business. E&P data is typically managed using a two-tier storage architecture with active data stored on high-performance, high-availability disks and with inactive data archived to tape storage. Due to the mismatch between the storage architecture and the changing value of information throughout the life of E&P assets, current information management practices do not enable oil and gas companies to get the maximum value from their information at the lowest total cost at every point in the information life cycle. Information life-cycle management (ILM) is a data storage methodology and architecture that aligns IT infrastructure with business needs, based on the changing value of information over time, at the lowest possible total cost of ownership (TCO). More specifically, it is a process by which information is moved between different tiers of storage media to ensure that the service levels required by the business are met at the lowest TCO based on the content of the data. ILM also progressively automates the storage management process over time, minimizing the risk of human error or interference and optimizing the movement of data between the storage tiers. Benefits of ILM can include: ■ Organizational agility (e.g., finding the right data faster and reducing the impact of ‘blindside’ events) ■ Reduced risk (e.g., regulatory compliance, business continuity, and security) ■ Lower storage costs (e.g., better IT asset utilization and lower cost per unit stored) For example, one large independent upstream oil and gas company has estimated that its technical staff spends up to 80% of its time searching for and manipulating data. Reducing that figure to 50% of the staff's time and multiplying it by the number of engineers and geoscientists on staff would equate to over 100,000 staff hours per year. Furthermore, the company predicts that, if for every 100 technical staff members employed, the time spent searching for and manipulating E&P data can be reduced by just 10%, it will realize an effective staffing increase of five to eight people.