Shale Energy Industry Entering Golden Age

Nancy Bartels is Control's managing editor. You can her at [email protected] or check out her Google+ profile.Frank Whitsura, Honeywell Process Solutions vice president and general manager, predicted that the U.S. oil and gas business is entering "a golden age" in his address, "Automation and the Future of Shale Oil and Gas," today at the Honeywell Users Group Americas 2013 conference in Phoenix, Ariz. Honeywell Process Solutions will also prosper because energy companies are leveraging its process automation technologies to make the most of the boom, Whitsura said.

Whitsura compared the state of the shale energy industry with that of the refining industry in 1980. Back then, the refining industry was comprised of disparate units, had immature control systems and experienced relatively low throughput and yield. Today, both production and yield are up significantly despite the closure of many refineries. "Shale gas is in that same situation today," said Whitsura.

Keeping up with booming demand is only one of the stresses on the industry. The shale oil and gas business is not easy. Although new wells are being drilled at the rate of 13,000 per year, and their initial production is very high, it declines 80% in the first 12 months. "Producers need to get the most they can out of wells in a short amount of time," said Whitsura.

"Honeywell has been here before."  Honeywell's Frank Whitsura on the company's ability to help shale energy companies improve their operational performance.Another challenge is that many of these wells are in remote locations — many with extremely rugged landscapes and harsh environmental conditions. They also are widely spread out — in some cases over hundreds of square miles.

Over time, in order to address the issues that these conditions raise, wells and operations both will have to be consolidated, operations will have to be integrated and control will have to be centralized, Whitsura observed. We will also see more oil and gas operations that are much more integrated with other parts of their supply chains for greater efficiencies, and because of these efficiencies, we will see increased yields from wells.

He showed a slide of an imaginary oil well field where multiple wells are connect wirelessly to a centralized control room, which in turn is wirelessly connected to other parts of the operation. This is how shale oil and gas operations will look in the future, he said.

And Honeywell is on board to help with these initiatives, he added. It has experience and expertise in oil and gas that goes back decades and current technology to address many of the issues facing these energy businesses. Its latest iteration of Experion SCADA 430 and advances in RTU technology will be enablers of this vision.

"We think we have the experience to do this. We think we have the technology," Whitsura concluded. "Honeywell has been here before."