The Business Value of Using Sensors Atul Arya, BP plc Presented at the 2008 IBM Almaden Institute

2 The Business Value of Using Sensors Context - Scale of Prize A word about BP Field of the Future Refinery of the Future Summary

3 Scale of Global Resource Prize Unrecoverable (3.7tr) Produced (1.0tr) Remaining (1.2tr) Reserves growth (0.7tr) ~7 trillion bbls Original Oil in Place YTF (~0.3tr) 7 trillion bbls conventional oil in place 1 trillion bbls produced, 1.2 trillion bbls remaining 700bn bbls technically recoverable by increasing recovery factor Future advances in technology could enable some recovery of the currently “unrecoverable” 3.7 tr boe Field of the future scope is 1-6% oil in place and 2-8% production (CERA estimates) World oil consumption is 32 billion bbls/year US oil consumption is about 7.5 billion bbls/year

4 BP E&P - Global Operations 26 countries ~4 MMboe/d > 50, 000 oil and gas wells > 40 major projects underway Non-Proved Conventional Oil Deepwater Oil Viscous and Heavy Oil Conventional Gas LNG Gas Tight Gas CBM Proved 18 bn boe 42 bn boe

5 Definition Development and application of integrated real-time reservoir, well and facility work flows to improve operating efficiency and recovery FieldoftheFuture®: Definition & Vision Vision To deliver extraordinary levels of operating efficiency and recovery through the use of real time data and collaboration adding: 100,000 boed production 1 billion boe additional recovery by 2017.

6 Today’s FieldoftheFuture ® Reality The Extent 1.5 million boe/d 700 wells 40+ assets The Infrastructure 1.5million data tags 2000km of fibre >35 assets with collaborative environments The Technology Real time rate and phase data Rapid optimisation of complex systems Real time data feed to reservoir models First down hole fibre in gravel pack completion

7 Complete integration of all real-time data Gulf of Mexico Facilities Real Time DrillingDrilling Visualization Topsides Monitoring One Touch ISIS AWS (Subsea) Process Net Subsea/Well Surveillance Riser/Mooring Data Rotating Equipment Integrated Marine Monitoring Fiber Optic Network

8 Cross discipline collaboration Monitoring real time data Analysis & modeling Rapid Decision making Advanced Collaboration Environment Complete integration of workflows Azerbaijan Offshore Production facilities Onshore terminals & exports Integration

9 Optimisation of Complex Subsea Systems North Sea Reduced process instability Increased gas handling Time (days) Gas Flowrate (km3/hr) Technology Integrated, model based decision making in support of operations Benefits Well and Riser stabilization Gas handling capacity increased by 12% and oil production increased by 5 mbd. Improved oil/water separation

10 Refinery of the Future

11 The Changing Face of Crude Oil Oil Reserves by Region & Type N America C & S America Europe & Eurasia Middle East Africa Asia-Pacific Billion Barrels Conventional Crude OilHeavy OilOil Sands Source: BP Statistical Review ,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90, Sweet Sour NB : Sour >1% sulphur content Sources: BP Statistical Review, IEA, AAPG, EIG, OGJ and CRA analysis Total World Sulphur Content Projection Volume (tbd)

12 Implications of Changing Feedstock Need to improve ability to process a greater range of feeds Need to acquire necessary tools To support rapid decision making about feedstock purchases Growing environmental complexity

13 IMMEDIATE FEEDSTOCK VALUATION Refinery of the Future - Scope of the Programs FEEDSTOCKS SUPPLY & TRADING REFINING PRODUCT SALES PROCESSING HIGH MARGIN FEEDSTOCKS NEXT GENERATION LOGISTICS Theme Name Scope of Themes REFINERY WIDE OPTIMISATION REMOTE PLANT MONITORING Value Chain Programme Theme

14 Next Generation Logistics

15 Remote Plant Monitoring

16 Deployment of MOTE Technology Large scale deployment at Naperville R&D facility 80 device network gathering secondary plant data Added real business value due to –Reduced capital costs –Improved efficiency of manning –Optimised operations from increased data accessibility

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18 Lessons Learned and The Future Lessons Learned Senior Leadership Support Business engagement Focus on value Scalability, from one asset to many Multi-disciplinary Integrated Teams The Future Targeting: across the BP portfolio – more assets Scale: more than80% of production and refinery throughput Impact: short term (production) and long term (ultimate recovery)