How to achieve timely well servicing and raise the equipment utilization ratio from 34% up to 76%: the “INK” case
Despite the wide range of tasks associated with managing utility vehicles and portable equipment in the oil industry companies, many market participants still rely on pen, paper, and electronic spreadsheets. As a result, various subdivisions within the Utility Vehicles Department and the Wellwork Department face several challenges. These challenges include the complexity of managing equipment orders, planning and monitoring the actual utilization of equipment at sites, non-productive time, low equipment utilization ratio, and a lack of tools for convenient interaction between drivers, dispatchers, and contractors.
Read on, to find out how digital platform Magenta is solving these problems of managing the vehicles and what the results of its implementation in the Irkutsk Oil Company (INK) are.
“INK”LLC is one of the largest independent oil and gas producers in Russia:
- 5800 vehicles at sites
- 3,5 mln in-service hours per year
- 1900 km is the length of the company’s internal service lanes
About the Company
The Irkutsk Oil Company was founded in November 2000. Over the course of 20 years, it has evolved from a local operating company developing three oil fields into a company of federal significance. Currently, “INK” is actively engaged in geological survey, exploration, and production of hydrocarbon materials at 53 oil fields and licensed areas.
Ensuring uninterrupted well performance is of critical importance in oil production, as any suspension of production can result in multimillion-dollar losses. The implementation of well operating procedures relies on the use of various equipment, and the timely and coordinated delivery of this equipment directly impacts the efficiency of the work. To execute these tasks, “INK” utilizes both its own vehicle fleet and rental vehicles.
In 2018, the oil production company initiated the process of digitizing their vehicle management. This decision was driven by the following reasons:
- Unstructured procedure for handling equipment orders
On a daily basis, dispatchers at “INK” process up to 1500 equipment orders. Prior to the launch of the project, these orders originated from various sources such as paperwork, electronic mail, facsimile, and telephone calls, lacking a standardized format. Consequently, the manual processing of such orders and the distribution of equipment were also carried out manually. Dispatchers had to independently prioritize the orders, decipher their specific requirements, and make decisions regarding the appropriate equipment type and duration of use.
In order to facilitate effective planning, dispatchers had to consider multiple parameters, ranging from the current utilization of equipment at other sites and facilities to the interdependence of orders as part of related jobs. Managing such tasks became increasingly challenging, and planning errors could lead to delays in job delivery.
- Need to increase the vehicle utilization ratio
In order to successfully carry out complex technological processes, it is crucial to ensure the availability of the required equipment prior to the implementation of the corresponding tasks. This can be achieved either by having the complete set of equipment present at the worksite throughout the entire duration of the process, or by precisely planning the delivery of equipment to coincide with the specific tasks that require it.
In the first scenario, valuable equipment remains idle for extended periods of time, resulting in low utilization ratios and high costs. In the second scenario, it is necessary to synchronize different types of equipment, ensuring that each piece is delivered to the facility in a timely manner for its designated stage of the job, eliminating the need for equipment to wait idle for its “companion equipment”.
To accomplish this, it is imperative to optimize the delivery of vehicles through effective planning. In cases where there are deviations from the plan, whether ahead or behind schedule, adjustments need to be made to the work plan and promptly communicated to the drivers.
Upon the launch of the project, the vehicle utilization ratio stood at 34%. In order to increase this parameter, it was essential to synchronize equipment, optimize communication between dispatchers and drivers, and ensure that all participants in the process are connected within a unified information space. Furthermore, it was important to enhance the monitoring efficiency of work at various sites and facilities, enabling the timely detection and resolution of any deviations.
- Increasing Quality of Equipment Utilization Monitoring and Driver Performance Record
Prior to the project launch, the information of the job actually performed by contractors was taken from trip tickets. To verify the actual scopes of work one had to manually implement the comparison of the data provided by drivers with the data of the tracking system, which required a considerable amount of time.
- To decrease losses in production level due to reduced time for Wellwork operations;
- To increase the equipment utilization ratio up to 70%;
- To provide complete control over the equipment fleet utilization.
- Mixed vehicle fleet — own vehicles and rented ones. When working with contractors, it is important to achieve equal distribution in scope of works among all performers.
- Closed maps and period-to-period roads – The internal technological lanes of “INK” span a distance of 1900 km. These roads are not included in public map services, and some sections are only accessible during specific seasons. This information needs to be considered when planning the routes for equipment transportation.
“As a result of the Magenta platform implementation, the utilization ratio has raised from 34% up to 76% for certain types of equipment. We started processing larger number of wells per day and reduced the equipment operating shifts. The data that we obtained after the system had been launched became a basis for making decision about expanding the mobile network coverage and installing wi-fi spots at sites and facilities. Due to this, the process participants exchange information faster which increases the coordination and efficiency of all the processes”, said Natalya Bagdueva, the lead consultant for introduction of information systems in “The Irkutsk Oil Company” LLC, her speech was held at the “SMART OIL & GAS” conference, September 2022.
Video: the project presentation at the “SMART OIL & GAS” forum
See the speech made by the lead consultant on the introduction of information systems in “The Irkutsk Oil Company” Natalya Bagduyeva. The VIIIth Federal forum on IT and digital technologies in oil and gas industry of Russia, “SMART OIL & GAS”, September 2022.
The order processing procedure has been optimized
- The Magenta portal is for filing and dispatching the orders
To optimize the work of the dispatcher for processing the orders, we had to get rid of the multichannel network and make it possible for the orders to come in a standard format with coordinated priorities. This is what the Magenta portal has been developed for. It can be accessed by employees of each subdivision and is now used for filling the orders.
The Magenta portal introduction made it possible to reduce the number of cases when the equipment order is unjustified; it helped to minimize the hard-copy paperwork.
- Designer tool for technological processes
A designer tool has been developed for the Magenta planning module. Process engineers describe standard scenarios (technological processes) of the work execution in advance, which includes the sequence of operations, their interrelationship, duration, types of equipment involved in that, all the necessary resources etc.
Previously, a foreman had to order all the equipment associated with a work cycle – now it is enough to select a required technological process and the portal would, by default, generate orders for all kinds of equipment required for the whole work cycle.
Examples of technological processes:
- Wellwork crew mobilization
- Well treatment with water, oil, gas-and-condensate, methanol-water solution
- Pressure testing, pipeline oiling, air leak testing
- Transportation of oily and gravity solutions
- Well dewaxing using hot fluids
- Cargo-handling operations
- Drilling oil wells
- Drink water delivery
The equipment utilization ratio has increased up to 76% for certain types of equipment
The equipment delivery planning process has been automated using the logistic platform Magenta. This platform selects the necessary equipment for each order, considering its location, transportation duration, and minimizing non-productive time. The system plans the movement of vehicles to ensure they arrive at the site on time without wasting non-productive time waiting for companion equipment. It also takes into account factors such as seasonal accessibility of transportation roads and queuing for fueling. The planned routes are automatically transmitted to drivers equipped with the Magenta software.
As a result of comprehensive planning, the following outcomes have been achieved:
- Equipment utilization has increased by up to 76% for specific types of equipment.
- The average number of well treatments per day has increased.
- Queues for fuelling at gas stations have been reduced.
- Vehicle work shifts have been shortened.
Number of phone calls between drivers and dispatchers has been halved
The driver’s software is designed to function even in areas without internet access, allowing it to operate seamlessly. It can store and exchange accumulated data when internet connectivity becomes available. The implementation of this software has significantly improved the interaction between dispatchers and drivers, resulting in a 50% reduction in the number of phone calls required for communication. This optimization has streamlined operations and enhanced efficiency in the workflow.
The equipment utilization monitoring has increased
To enhance operational control and obtain accurate data regarding the duration of each stage of work, the Magenta logistic platform has been integrated with GPS-monitoring systems. This integration enables real-time tracking of vehicle movements, ensuring efficient monitoring. The dispatcher can track the progress of work through data received from the drivers’ mobile workstations, allowing for prompt assignment of vehicles for urgent orders and equipment reassignment.
Customers involved in the process can monitor the execution of each stage of work through their Magenta portal dashboards. The electronic journey plans are regularly updated with information on the status and scope of work performed by contractors, and these plans can be printed at the end of each work day. Additionally, the system supports automated data transmission to finance systems, facilitating quick verification of data with the tracking systems and optimizing the verification process’s cost-effectiveness.