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Mar-2021

The intelligent midstream

Oil and gas operations success hinges on digital transformation. Between diverse business models and fluctuating market and regulatory pressures, every midstream company faces a unique set of challenges.

Craig Harclerode
OSIsoft


Article Summary

The PI System™ serves as a foundation for the digital transformation of the oil and gas industry. It enables midstream operators to tackle today’s toughest challenges and reach business and operational goals.

Consistently inconsistent: No two models are the same
In the oil and gas midstream sector, no two business models are the same. The breadth of midstream processes and assets is distinct from the more defined and consistent nature of the upstream and downstream business models. From natural gas to crude oil, natural gas liquids (NGL), liquefied natural gas (LNG), processed water, or any combination of these, every subset of the midstream faces its own operational challenges. In spite of these differences, every midstream company has the same overarching goals of optimising operations, maximising asset value, and delivering differentiated midstream services.

The midstream market is the circulatory system of the oil and gas industry. It caters to both upstream and downstream needs by leveraging a highly distributed and diverse asset base that spans gathering, processing, transportation, storage, disposal, and distribution. Customers include exploration and production companies, refiners, fuel distributors, utilities, and industrials. Just like the human circulatory system, every part of the midstream sector must work in harmony to gather, cleanse, and move oil and gas from origin to destination. Each company has a unique business model to facilitate product transfer, which means there’s no one blueprint for success. But one thing is certain: companies must effectively leverage both assets and people.

Midstream: The circulatory system of the Oil and Gas value chain
Every company in the midstream industry faces unique business-level challenges compounded by industry pressures. Ever changing supply and demand, environmental pressures, and pricing fluctuations are just a few external factors that influence daily operations. The sheer volume of custody- transfer meters, as well as tariff-based fees and margin calculations, further increase complexity. In the midst of these dynamic pressures, midstream companies must also differentiate operations and offerings to demonstrate safe, reliable, cost-competitive, and flexible midstream services.

In response to these industry and internal pressures, many midstream companies are embarking on digital transformation journeys. These efforts focus on real-time insights, contextualised operational intelligence, and remote, self-service enablement across the entire enterprise. With this groundwork, teams can make data-driven decisions around asset performance management, condition-based maintenance, environmental compliance, inventory and commercial accounting, lost and unaccounted system inventory, and more.

Success in digital transformation hinges on a single source of truth for operations data. The PI System lays the foundation for operations data integration, applications, and analytics infrastructure so oil and gas midstream companies can gain valuable insights from a disparate network of systems. From operational digital twins to advanced analytics, the PI System enables midstream companies—regardless of business model— to transform operations and cultures and reap the benefits of digital transformation efforts.

Self-serve, contextualised operations intelligence can empower oil and gas companies to innovate, improve, and drive new efficiencies in every part of the midstream process. Just like upstream and downstream counterparts, the majority of midstream companies gather operations data from various sources. However, operations data does not equal operational intelligence. Collected data is often siloed in disparate systems in a variety of formats and has different tag naming conventions for equipment across sites and systems. Continuing this trend will result in an influx of data, but companies will lack the right insights to drive operational efficiency and change.
Unfortunately, many producers are rushing to layer in new technologies and solutions such as cloud, machine learning, edge, Industrial Internet of Things (IIoT), and predictive analytics before building the right data and analytics foundation. Adopting these new solutions can potentially deliver new and valuable insights, but midstream companies must first enact solid data management and analytics strategies. Deploying an enterprise-level, real-time data management platform lays the foundation for future technology success.

A data management platform unlocks endless insights and paves the path to reaching digital transformation goals.

PI System: one platform, endless insights
Operating in today’s oil and gas midstream services segment calls for agility, not experimentation. It requires a market-proven approach that can drive an immediate business impact yet enable the digital transformation journey. Since 1980, the PI System has delivered operations data into the hands of users so they have the information they need to reduce costs, increase productivity, and transform their business.

The PI System connects process and sensor data to operators and decision-makers throughout an organisation. Acting as a single source of truth, the PI System transforms data into information to monitor and validate the state of physical operations. With real-time data from the PI System, operators, engineers, and managers can quickly diagnose issues and make data-driven decisions to increase output from fixed capital and improve both quality and safety—all in a self-service, no-code environment.

For example, for natural gas gathering and processing, operators can increase viability and optimise NGL recovery in individual plants or across gathering and processing super systems with a resulting increase in effective capacity. Liquid pipeline operators can optimise drag-reducing agent (DRA) costs versus energy and capacity. Liquid terminal operators can perform flow path analytics to help in troubleshooting and support risk-based inspection.

The PI System gives users the tools they need to optimise individual segments of operations or maximise performance across their entire enterprise. With real-time PI

System insights, producers can monitor asset health, enact condition-based maintenance strategies, and gain the visibility needed to move natural gas and liquids efficiently and effectively from input to output. Standardised, contextualised insights using Asset Framework (AF).

Operations data must first be standardised and contextualised before it can be analysed and visualised. An agnostic data management platform combines, abstracts, and normalises disparate data sources from multiple control systems and information silos in one centralised location. This platform becomes an operational system of record, creating the foundation to democratise insights across any midstream business model. A centralised operations data management platform uses standardised and templatised tag-naming conventions, and assets are catalogued in a flexible hierarchy. This structure ultimately enables users to create contextualised views, operational digital twins, and user-configurable, self- service dashboards.


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