Paradigm CEO Shares Insight On Surviving The Downturn

As the world’s abundance of available oil and gas resources exceed demand, E&Ps continue searching for ways to operate smarter and more efficiently as lower commodity prices drag down profits.

In addition to negotiating discounts and seeking other cost savings, many have turned to technology and partnerships to better cope with challenging times. Paradigm, an independent developer of software for the oil and gas industry, is among the companies that have formed partnerships while strengthening existing relationships with E&Ps.

Arshad Matin, president and CEO of Paradigm, has been through economic upticks and downturns. Matin recently shared his formula, via email, with Hart Energy for “surviving the lean years with an eye toward the future.” His comments have been edited for length and clarity.

Q: The downturn has caused many oil and gas companies to significantly reduce spending. How can companies like Paradigm help E&Ps optimize their existing portfolios?

A: With global E&P spending still trending downwards, operators cut costs, suppliers discount to maintain market share and the end result is an innovation-starved industry struggling to meet the challenges of complexity, data intensity and long-term skills gaps. Smart players with an eye toward the future must carve out a strategy for short-term survival and long-term success. Here are the principles we’ve embraced as pillars for our sustainability program at Paradigm:

• Maintain an open and interoperable platform, breaking down barriers of proprietary systems and data siloes by developing systems that blend innovation from wherever it comes. In spite of the downturn, we continue to invest in our HD platform with bi-directional connectors to all leading G&G [geological and geophysical] platforms and open to solutions from outside users. The days of proprietary innovation siloes no longer serve individual companies or the industry.
• Secure partners for new capabilities, finding creative ways to leverage our strengths in partnership with other market players—even outside the industry. Paradigm recently joined forces with GE Oil & Gas to deliver new capabilities in reservoir-driven production optimization (RDPO), combining subsurface knowledge with production intelligence to enhance efficiency and reduce costs. We have also partnered with Dassault Systemes to provide reservoir-driven production risk management, a new combined offering that optimizes completion strategies in unconventionals and anticipates fault reactivation. Early results from both alliances are encouraging.
• Engage people to accelerate innovation, building scalable programs to drive new technology development, and staffing those with relevant and capable experts—wherever they are found. Expanding on traditional models of employment, Paradigm is seeking talent from extended teams outside the organization. These range from independent consultants to regional service organizations selectively engaged to bring on-demand expertise and, as a side benefit, provide new roles for today’s large pool of displaced geoscientists.

Q: What are some of the industry’s best practices for open interoperability?

A: Open interoperability is a proven catalyst for creating high-value solutions for oil and gas that optimize production and boost efficiency, innovation, quality and service excellence. Such open sharing affords easy access to technologies for modeling, simulation and analysis built to suit for specific requirements.

At Paradigm, we developed our Epos data management infrastructure to empower geoscientists to collaborate on projects and interact in a common visualization environment. The goal is to securely share data across projects, locations and databases, optimizing storage, backup and data integrity with no need for data duplication.

We focus on staying light and scalable, with a rich set of data management tools suitable for customers of all sizes, from a single user to very large, geographically distributed enterprises.

One of our recent adopters is a large North American operator needing more advanced technical capabilities. The combination of software it used did not allow geoscientists to solve challenges such as time-to-depth conversion using well and seismic data and workflow-driven model building. Geoscientists were using multiple suppliers’ software, working across many offices and supporting growing numbers of assets. This led to fragmented workflows and serious communication challenges, both costly and inefficient.

The operator required minimal disruption to production. It provided source data from one of its assets, and over two weeks, the Paradigm team evaluated the data using the Epos system. All required workflows performed well using integrated petrophysics, geophysics,and geomodeling, and reservoir engineering solutions.

This integrated data was shared by multiple users, reducing data duplication and affording seamless collaboration and data flexibility.

Q: What is the focus of Paradigm’s partnership with GE Oil & Gas? What technological challenges are you tackling?

A: Today’s operators need to maximize the life of existing reservoirs while reducing operating costs. Improving problem detection and treatment design alone can reduce operational costs by 10% to 25% through fewer interventions and more efficient resource utilization. The GE Oil & Gas and Paradigm solution, RDPO, provides a clearer understanding of the reservoir geology, permanent monitoring of wells and predictive analytics so that operators are better equipped to understand risks and act upon them.

With growing instrumentation throughout the oil field, operators have access to real-time production data such as pressures and flow rates. RDPO enables production engineers to make use of all that data, conduct nodal analyses and evaluate diagnostics via links to a 3-D model of the subsurface. The result is a better understanding of the impact of production interventions before taking costly and potentially adverse actions.

Q: Infill drilling optimization seems to be a method operators are using today to increase ultimate oil recovery. What work is Paradigm doing in this area?

A: When we talk about infill drilling, we often refer to mature fields, managed from a production perspective far removed from geological considerations. What Paradigm brings back into the infill location selection process is the understanding of the subsurface. Our ever-evolving technology provides new insights, enabling users to efficiently revisit large numbers of well logs and seismic data, quantify the remaining geological uncertainty and correlate to production data.

Q: Is there anything else you want to add?

A: Simply that, as an industry, oil and gas is well-versed in economic fluctuations. Some, the industry has weathered well. In others we have lost significant ground due to short-sighted decision making. My passion is to bring high science to every player in E&P, and Paradigm can’t do that by cutting corners during tough times.

My hope is that the strides we make as a company will benefit other players as well, and that our industry will emerge from the current downcycle stronger, smarter and more cohesive than ever before—ready to face the mounting energy challenges the next generation demands will bring.

Velda Addison can be reached at vaddison@hartenergy.com.