Bridging the Petroleum Technology Transfer Gap

Abstract:Founded in 1993, the Houston-based Petroleum Technology Transfer Council (PTTC) uses regional centers to identify and fill the oilfield technology needs of small to mid-sized producers—the heart and soul of U.S. exploration and production (E&P).

Analysis:For the petroleum industry, the end of 2002 probably won't come any too soon. All told, it was a "rain check" year that, due to all the uncertainties created by international events, saw a marked slowdown in new E&P activity, particularly in the U.S.

With the dawn of the new year only days away, the industry likely looks forward to market improvements in 2003 that will cause drill bits to start "turning to the right" at rates high enough to bring the industry out of its daze.

Expectations aside, however, there is one thing upon which oil men and women can depend with confidence: At no time in its history has the industry—particularly the independent producing sector—had access to as much useful E&P technology as it has today. U.S. independents, though still recognized for their legendary self-reliance and determination, have come to depend more on outside sources for new ways to both improve production and increase reserves. They're cutting finding costs and improving well profitability, much of it due to using all-new technologies, as well as applying existing technologies that have been "tweaked. "

Major U.S. integrated companies no longer carry the new product/service research and development (R&D) load, eventually passing it down through licenses to manufacturing/service companies and hence, to independents. Today, fewer majors mean fewer R&D efforts on their part. So, technology development and ultimate transfer to practical field use has become the full-time job of the manufacturing/service sector, public and private research laboratories, the engineering departments of colleges and universities, and even some larger independents.

But another source of new E&P technology—perhaps even the largest in the mix—exists with the U.S. federal government, mainly under the auspices of the U.S. Department of Energy (DOE) and its highly organized technology development organizations in cooperation with private industry, academic institutions, and the double-handful of DOE National Laboratories located around the country. Strategically applied federal dollars, matched by the collaborators in either greenbacks or "in-kind" contributions, have stimulated scores of new approaches to help independents fill technology needs.

But during the last decade or so these and other technology sources, while all working to provide smaller producers with new products and techniques for finding new reserves and optimizing existing ones, have created a glut of data that far exceeds individual companies' abilities to absorb it, even with the geometric growth of the Internet as an information "clearing house."

Fortunately, however, for most of the same period, independent producers have had the benefit of a major disseminator of information about new and tweaked E&P technologies: The Petroleum Technology Transfer Council.

The PTTC, founded in the nation's capital but based now in Houston, TX, employs a permanent staff that, while small, continues to participate vigorously in all U.S. producing areas. Still other PTTC representatives work on contract as part of their employment with various state geological surveys and other petroleum-oriented bureaus, as well as with academic institutions. Unpaid industry volunteers share their experience and insights to keep efforts focused on industry needs.

Primary PTTC funding comes through the DOE's National Petroleum Technology Office and the Strategic Center for Natural Gas within the National Energy Technology Lab. The organization also enjoys the support of several state governments, universities, and state geological surveys, mainly through the 10 Regional Lead Organizations (RLOs). Industry donations and in-kind contributions play an important role, as well, and are tax-deductible. Together, the cost sharing from all sources provides more than 50 percent of financial support for PTTC, which is a not-for-profit corporation under IRS Code section 501 (c) 3.

To its credit, the PTTC in nine years has grown to become the key source of unbiased information about and access to practical, field-ready upstream oilfield technologies. The PTTC doesn't develop the technology itself, but sees to it that producers are exposed to both the general and technical aspects of technologies developed by others.

The mission of the PTTC is threefold: First, to help identify producers' high-priority technical problems and make them aware of technology opportunities; second, to educate producers about technology options; and third, to connect producers to those options. The ultimate goal is to transfer E&P technologies to help producers reduce costs, improve operating efficiencies, increase ultimate recovery, add new reserves, and enhance environmental compliance.

As Donald F. Duttlinger, PTTC executive director since July 2000, puts it, independents face technology decisions every day, such as whether to address an opportunity or problem with technology, what solution to use, whether it' s cost-effective, and how it's to be used. The PTTC, he notes, serves as a "bridge" to help them reach those decisions more efficiently.

And while newly developed technologies are an important PTTC information asset base, the organization doesn't necessarily pass on detailed data about untested "blue sky" services that have no realistic current field application, and many times steer clear of providing details about Serial No. 1-type hardware unless there's a high degree of certainty that it will perform as asserted. And the technologies made available aren't all of the leading-edge type, either. PTTC officials have discovered that it's often technologies about which the industry has known for years, but for whatever reason has not applied, that can open up new avenues for producers, particularly when applied in new geographical areas or under different geological conditions.

To achieve its goals, the PTTC operates through its RLOs to offer expert assistance, information resources, interdisciplinary referrals, and demonstrations of E&P services and products, including computer software. Informal, one-day technology workshops, averaging about 150 each year around the country, cover the full spectrum of PTTC's goals. And while such workshops are numerous enough to keep attendants few in number but all deeply involved, the technology messages are reinforced through one-on-one conversations and referrals to appropriate literature.

A major activity for PTTC is problem identification, said Duttlinger. This takes many forms, including ongoing interaction with producers, both regionally and nationally. Even more benefits can accrue from helping producers clarify their own understanding of their needs and then communicating those needs to companies that develop and provide the necessary technology, he added.

In addition to meeting its regional and national educational and problem identification goals, the PTTC today maintains what is probably the most extensive multi-level national communications program in the U.S. petroleum industry.

Starting with its website, which holds wide sets of new technology information from many sources and draws an average of 12,000 user sessions per month (with some 45,000 page views per month on average), the PTTC has opened avenues to producers on a number of other fronts. Among these are the following:

-- PTTC's 16-page quarterly newsletter, PTTC Network News, which now reaches about 11,000 individuals, nearly 60 percent of them working in the E&P sector, with more than 60 percent of those employed by independent producing companies. This publication also is available online. -- PTTC's twice-per-month Technology Alerts via email. Introduced last April, this broadcast email "down and dirty" news sheet has grown in circulation from 3,500 to about 8,150 by the middle of this month, with additional growth expected in the coming year. -- Seven of PTTC's 10 RLOs publish a regional newsletter, either in hard copy or online. Combined circulation is about 21,000.

The PTTC also has striven to leverage its outreach through the primary petroleum E&P trade publications. In addition to providing articles from time to time for a number of these journals, PTTC arranged in 1999 to take the lead in providing case studies of technology applications for the Petroleum Technology Digest, a joint monthly effort with Gulf Publishing Co., Houston, and distributed as part of World Oil magazine, which reaches more than 39,000 readers worldwide. The PTTC also contributes monthly Tech Connections columns for the American Oil and Gas Reporter, based in Derby, KS. The organization is planning to add further communications outlets as opportunities are identified, Duttlinger said.

Praising the initial contributions made by his predecessor, Deborah Rowell, who now manages new program development for the American Petroleum Institute, Duttlinger said the PTTC hopes to expand its capabilities even more in the coming years. For example, he noted, PTTC has begun working with a number of major petroleum industry trade organizations on cooperative efforts to make technology transfer awareness more available to their members.

But bringing information about new and improved upstream technologies to the fore remains PTTC's foremost goal, he said, singling out the contributions made by Lance Cole, national project manager, and other support staff members in helping to oversee the distribution to the industry of high-quality data on practical, ready-to-use technology. He also recognized the efforts of RLO professionals and staff in bringing region-specific technical information to producers throughout the country, as well as the hard work and attention to detail offered by the regularly elected PTTC national and regional leadership.

In short, this is a successful outfit, and promises to be so for many years to come. Also, in the unlikely event that a U.S. independent producer or oilfield manufacturer/service provider reading this might not know about the PTTC and its programs, their website address is

Editor's note: In this column dated December 16th and titled: "Automated Rig Leaves Soon for North Slope," an account of the newest version of the so-called "automatic" drilling rig failed to state that due to cost overruns and long delays, the contract between the stated customer, BP, and the rig's designer, Phoenix Alaska Resources, was recently cancelled. The machine remains, apparently idle, at the Texas fabrication yard where it was assembled.