Invest In Information

All of us have big, costly decisions to make. Make the correct decision and you can make your company more profitable. Get it wrong and you cost the company money. Decisions are important, and therefore, having accurate information to work with also becomes important. There is major economic value in good information, and therefore we need to see it as an asset, just like a piece of machinery. Good information is something to be invested in, not an expense to be cut out of the budget.

Let's briefly talk about the difference between expenses and investments. Expenses cost you money, and after the fact you have little or nothing to show for it. The money is gone and it's not coming back. You should do your best to reduce your expenses. Investments on the other hand make you money in the future. Sure, they cost you some money upfront, but (hopefully) that money comes back to you, with profit, in the future. Investments are not something to be eliminated, rather they are something to be carefully and thoughtfully planned out.

Invest in information so that you can make more informed decisions.

Don't Let Yourself Run Out Of Ideas

"We usually find oil in a new place with old ideas. Sometimes, we find oil in an old place with a new idea, but we seldom find much oil in an old place with an old idea. Several times in the past we have thought that we were running out of oil, whereas actually we were running out of ideas.” - Parke A. Dickey, 1958

Mr. Dickey made this quote 64 years ago, but it seems to fit perfectly with the present day. I remember being told in high school that the world was running out of oil and gas and there was no future in this industry. Then some innovative people figured out how to combine horizontal drilling with high-volume hydraulic fracturing, and BOOM, the shale revolution started! As it turns out, we weren't running out of oil and gas, we had just run out of ideas. When we embrace innovative and outside-the-box ideas, it's amazing what we can come up with.

Today’s advice is simple: be creative, think outside-the-box, and never let yourself run out of ideas.

Spend Time On Things That Have a Long-Term Impact

Engineering Tip: Spend time on things that have a long-term impact and endure the test of time.​
I am a Penn State alumni and I bleed blue and white (WE ARE!). I also love wrestling, especially Penn State wrestling. Our coach, Cael Sanderson, produces some of the best wrestlers in the world and some of them go on to wrestle in the Olympics. You can imagine how exciting it is for me to watch these guys wrestler on the world stage, and remember how fun they were to watch back in their college days.

Recently, I had the chance to watch a former Penn State great, David Taylor, wrestle in the gold medal match. David was undefeated going into the finals and had dominated every match up to this point. Now he had to wrestle an Iranian superstar and 2016 gold medalist, Hassan Yazdani. The match was close the entire time, and my boy David Taylor was down 4-3 with about 20 seconds left. Then an amazing thing happened: David Taylor summed up the energy to shoot a brilliant double leg takedown and take a 5-4 lead as time expired, to win the gold! It was awesome.

So what does this have to do with engineering?

David Taylor had endurance. Late in the match, when his opponent was exhausted, David Taylor had the extra strength to push through and make the necessary move to take down the champ. But here's the thing, this endurance didn't happen overnight. What we don't see when we watch Olympic athletes compete, is the countless hours of training and hard work. As they are training, these athletes have a long-term goal that is far more important than any short-term pain they experience. The result is a chance to complete in the Olympics, and for the very best like David Taylor, they win a gold medal. They focus on the long-term and don't let themselves get bogged down with short-term problems.

I think that far too often we get caught up focusing on urgent, short-term problems and we neglect the things that could really have a long-term impact. What if we spent less time putting out small, annoying fires, and more time building systems that help us make more informed decisions, or help us cut costs without sacrificing quality? What if we spent more time training up the next generation of engineers so that they can take some of the small stuff off of our plate, and allow us to focus on bigger issues?

How much more profitable could our organizations be if we focused more time on the things that had a lasting impact, and left the short-term things to someone else (or no one else, perhaps).

If you're interested, you can watch the highlights of the match here. The winning takedown is at the 2:40 mark.

Don't Ignore Production

Engineering Tip: Don't Ignore Production​
In upstream oil and gas, production is the only phase in the life of a well where you actually MAKE money. Every other department spends money. Drilling and Completions spend A LOT of money. Building pipelines costs A LOT of money. And where does the money come from to pay for all of these things? From Production!

It may seem obvious that Production is important but if you look at how many companies operate, they seem to place very little value on production. Why is this? It's because all of the big budgets, and therefore all of the attention and focus, is at the drilling and completion level. This is not to say that we shouldn't put a lot of attention on drilling and completion. We should, because there is a lot of money at stake. However, I've seen many many times where decisions are made in the drilling and completion phase, that have huge impacts on future production, yet there is almost no thought given to the impact on production.

For example, how often do we see new wells get completed with high tubing set points, or packers downhole? These decisions have a major impact on the ability of that well to keep up production over time. And far too often these decisions are made by drilling and completion engineers, with no consideration on how this will limit production over time. Too often the attitude is, "TD the well, complete it, move on and never look back".

Production is the only revenue stream for an E&P company. It is literally the life-blood of the company. We should start to take it a little more seriously and quite treating it as the red-headed step child of oil and gas operations. When the money is getting tight and the budgets get slashed, you'll wish that you had prioritized your revenue stream a little more.