Cooperation In Oilfield Brings Value

Bob Peebler
Bob Peebler

It’s a new world for today’s geophysical operations – and the new world seems a lot more cooperative than the old.

Energy officials who traditionally relied on in-house groups to drive research and development are finding themselves much more willing – and ready – to partner with other entities to build innovative technologies, says a Houston energy company executive.

“Today’s digitized, globalized world requires companies to embrace multiple new models to sustain their innovation engines and remain competitive,” said Bob Peebler, chief executive officer of ION Geophysical Corp.

Peebler was the keynote speaker in March at the 16th annual 3-D Seismic Symposium, a one-day conference in Denver sponsored by the Rocky Mountain Association of Geologists and Denver Geophysical Society.

Speaking to a group of about 700 attendees, Peebler said the boundaries in R&D between independent oil and gas companies, state-owned national oil companies and oil field service and equipment companies continue to blur.

In the past, R&D was viewed as proprietary, while information sharing was frowned upon, he said.

But today various entities now compete and cooperate, “often forming technology development partnerships to address asset development challenges that none of them are well suited to do on their own,” Peebler said.

Before the 2008 economic downturn, the energy industry was just buying and selling capacity, he said. There was no real need to invest in new technology when oil prices were increasing.

But now that the country is moving past the financial crisis, “new technology will be much more important, particularly in North America,” he said. “It will become increasingly important to not drill marginal wells. There are tremendous challenges now to apply technology.”

Back in the 1999-2000 period, ION (formerly known as Input/Output) “was … total vertical integration” regarding R&D, he said.

But by the end of this fiscal year the company will spend about $50 million a year, or 7-10 percent of its revenues, on R&D, and much of that will include outside partners for corporate ventures, trans-border joint ventures, E&P company partnerships and collaboration with universities, he said.

“We’re building systems now, not individual products,” Peebler said. “It’s very seldom that you have the solution yourself. You need partners.”

For example, ION worked on the problem of shooting seismic surveys during the extremely short season in the Arctic. “How can you tow streamers under the ice?” Peebler said.

ION partnered with another company to create a streamer technology that has been implemented in Greenland.

“The next step will be to go from 2-D under the ice to 3-D,” he said.

Along with corporate partners, ION also has collaborated with academic partners, including work with the University of Texas on next generation land sources.

It also has developed a virtual trade fair and product development lab to connect with the global customer in cyberspace.

“There’s more merger of the virtual world and the physical world,” he said. “These are in the experimental stage.”

In the arena of trans-border joint ventures, ION is working with a state-owned oil company in China; Peebler said they often use e-mail and video conferencing from its Houston office to confer with Chinese personnel who speak Mandarin.

“How to shape and make it work is a challenge – we’re dealing with cultural differences,” he said. “Engineering styles vary across cultures more than you would expect.”

ION also has formed co-development and co-deployment partnerships with exploration and production operators. In its FireFly cableless acquisition system, the company is partnering to build a new generation of seismic technologies through a cableless recording system.

“We faced a dilemma of building 10,000 stations in this experiment,” Peebler said. Because the cost was so exorbitant, the company invited other energy businesses to invest in this experimental prototype.

When the FireFly cableless system started five years ago, it totaled 8,288 recording points, he said. Now it has expanded to China, Mexico and the United States – and has 89,379 recording points.

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