Looking for BIG Ideas from
SMALL Companies –
Statoil Technology Invest
Venture Showcase
Corporate Venture and
Technology Implementation
Topics to address
• STI – Rationale and business model
• Growing succesful companies – Implementation is key
• Case examples
2
Classification: Internal
Dual business model
The driver is implementation value
Value creation
− 20 x multiple from
implementation in Statoil
Implementation
value
− 2-3 x Exit multiple for STI
and entrepreneur
Exit
value
Invested
BNOK 0
3
Classification: Internal
1
2
3
∫∫
12
Equity and project financing
Equity Investments
LOOP
Intelligent Mud Solutions AS
4
Seed and venture investments
Product development programme
20 portfolio companies
300 projects completed
Actively looking for new deals
3-5 new projects per year
Classification: Internal
What drives success for our portfolio
companies?
Start-ups are a large source of E&P Tech
- relying on pull-through from Majors for commercialisation
Role of various players through the development process *
Non E&P
18
Academic
25
38
Start-ups
40
Big 3 OFSE
Other E&P
43
29
23
Idea
32
Prototype
1st field test
Majors
Commercially
available
50% Penetration
* Mckinsey
* The role is defined as the financial value of resources devoted to the effort (i.e. direct funding, expertise, laboratory time etc.), for phase 2-4.
“intellect contribution” is also assessed and included
Source: Industry journals, interviews
6
Classification:
Internal
For the first
phase
All our companies go through «death valley»
Field test to
commercial
+
Cash
flow
Time
KEY “RULES”
-
R&D funds
available
• Focus on sales from day 1
• IMPLEMENTATION (A tight relationship with an end user that
needs the product.)
The Death
Valley
010731Technology in
E&P-main pack.ppt.ppt
7
Classification: Internal
• Building a commercially oriented board and management
Recognise the incremental nature of
• technology development
• with a paying value proposition for
each step of the way
8
Classification: Internal
Case stories
Implementation on Smørbukk
• Fishbones is a case with an
entrepreneurial founder Rune Freyer
identifying needs with an operator.
• RDI have worked with Fishbones
since 2013
• STI invested in Fishbones in 2014.
• Two technologies – both with
immediate application
• => Aim is succesful pilot and multiple
follow-on applications
10
Classification: Internal
Inflow tracers vs. PLTs
Technical capabilities
Qualitative zonal contribution
Locate water breakthrough
Yes / No
High / Med / Low
Clean up verification
21%
6%
1%
34%
Verify completion functionality
Quantitative zonal contribution
11
Classification: Internal
2014-01-10
38%
RESMAN: a dream case for ventures
Capital light, sales from day 1 and high growth!
Statoil has had an active role in developing the company….
2005
2006
Established as
Spin-off from
SINTEF, IFE
STI Investment
Statoil license
core patent
2007
2009
Validate flow
1st pilot well
Urd - Offshore
Validate water
breakthrough
1st commercial well
Skinfaks - Offshore
2011
2013
2014
Flow Loop demo of
Quantitative model
Longevity of oil
tracers increased
to 5 years
On-site analysis
Unconventional market
R&D financing for development of quantitative zonal contribution
1st Pilot well Kristin
RESMAN used in 35 wells
(80% Subsea)
….And been rewarded
28X (direct) Implementation Return
16X Investment Return
12
Classification: Internal
Direct
Indirect
Cost saving RESMAN vs. PLT
Increase Oil production
Reduce uncertainty for future IOR targets
Reduce water production
20%
DPI profits for 2014
Enhanced Drilling
MPD for floaters - historic development
2001 – Onshore
2005 – Fixed platforms
Floating drilling vessels
MPD technology for floaters is coming.. But why has is taken so long???
13
Classification: Internal
(1) @balance was acquired by Smith International / Schlumberger in February 2010
Finding the incremental value proposition
MPD “Light” : The first step
LRRS HP : The Initial Vision
14
•
Use a high pressure slender riser with a split BOP
•
•
Can drill in ultra-deep water with smaller vessels –
big cost savings
Use the same drilling procedures as with
conventional drilling, minimal new equipment
•
Enables drilling in depleted reservoirs with narrow
operating margins or for ECD management
Classification: Internal
LP: Low pressure marine drilling riser, HP: High pressure slender riser split BOP
Enhanced Drilling’s EC-drill
From investment to first pilot
STI invests in
ORS
2004
Approval of
technology
development
plan
Merger AGR-ORS
TRL4
Rig
Integration
CCB
02.10.2008
July 2012
30.10.2013
4-15 Jan 2014
Feasibility Study
for Troll
completed
Troll MC
approved
Nov 2012
Start drilling
Retrieved SPM
10.03.14
08.05.14
Partner
approval of
additional
founding
Docked SPM
offshore
while running
BOP and riser
Dec 2013
07.02.14
Oct 2010
Success has required massive and consistent support from D&W
15
Classification: Internal
TD Y3
16.04.14
Huge potential value creation
Cost
improvements
MPD from floater
Revenue
improvements
HSE
improvements
•
Reduced # casing strings
•
Reduced NPT
•
Increased ROP
•
Depleted reservoirs
•
Drill HPHT reservoirs
•
Value1.3BUSD in
Norway alone*
Less well control issues due to
better control of bottom hole
pressure
*Rystad Energy study for Statoil
16
Classification: Internal
Result : ED is now a front runner in dual
gradient drilling from floaters
• Troll: Overcoming depletion
• GoM: ECD control
• Worldwide traction
17
Classification: Internal
Integrated Implementation
Automated drilling – Can we land a grand vision?
Intelligent Mud Solutions AS
Drillpipe Auto-tracking, Fatigue analysis
2006
Real time monitoring, diagnostics
and control of the drilling process
2011
Automated fluid measurements
2015
2017
2008
2012
1s well drilled with
minimal human
intervention
Optimize Drilling Operations
Reduce NPT
Autonomous drill floor
18
Classification: Internal
10X data rate wireless
Increase Safety
Breaking News!
LOOP agreement with Intelligent Mud Solutions
«From Lab to Rig project»
Statoil
Funding, instruments and laboratory results
Cybernetic Drilling Technologies
Control systems
Intelligent Mud Solutions
Offshore skid competence
19
Classification: Internal
Prototype
testing
First use
2016
What is next?
Broadening the Scope for STI
New Energy
21
Classification: Internal
Oil and Gas
2015-04-27
Seismic
Drilling
Reservoir
Subsea
Statoil Technology Invest
Richard Erskine
www.statoil.com
22
Classification: Internal