Energy companies need to integrate new functions in order to better utilize data, says this expert

Using APIs, organizations can more easily combine their own internal data. Getty Images

Houston, home to one of Cognite's U.S. headquarters, is the energy capital of the world. But while many oil and gas industry players and partners come together here, much of the data they use — or want to employ — remains siloed.

There's no lack of data. Connected devices are a wellspring of enterprise resource planning data, depth-based trajectories, piping and instrumentation diagrams, and sensor values. But incompatible operational data systems, poor data infrastructure, and restricted data access prevent organizations from easily combining data to solve problems and create solutions.

We understand these challenges because we work alongside some of the biggest operators, OEMs and engineering companies in the oil and gas business. Lundin Petroleum, Aker Energy OMV, and Aker BP are among our customers, for example.

Flexible, open application programming interfaces can address the challenges noted above. APIs enable users to search, filter and do computations on data without downloading full data sets. And they abstract the complexity of underlying storage formats.

As a result, data scientists and process engineers can access data in an efficient manner, spending more time on their use cases and less effort contending with technical details. Using APIs, organizations can more easily combine their own internal data. APIs also simplify the process of using data from industry partners and other sources.

Most companies have slightly different work processes. But common API standards can help a company combine software services and platforms from others in a way that matches its own business logic and internal processes. That can allow the company to differentiate itself from competitors by employing services from the best suppliers to create innovative solutions.

Standardizing APIs across the oil and gas industry would open the door to a community of developers, which could create custom applications and connect existing market solutions. Then more new and exciting applications and services would reach the market faster.

To ensure adoption and success of such a standardization effort, the APIs would need to be well crafted and intuitive to use. These APIs would have to include the business logic required to perform the operations to empower users. In addition, APIs would need to define and allow for the sharing of desired information objects in a consistent way.

Best practices in defining common APIs for sharing data within the industry include:

  • Introducing APIs iteratively, driven by concrete use cases with business value
  • Ensuring all services using the API provide relevant output and insights in a structured machine-readable format, enabling ingestion into the API to ensure continuous enrichment of the data set
  • Making all data searchable
  • Preventing underlying technology from being exposed through the APIs to ensure continuous optimization and allow companies to implement their technology of choice
  • Supporting all external data sharing through an open, well-documented and well-versioned API, using the OpenAPI standard

If oil and gas industry operators define APIs, suppliers will embrace them. That will "grease" the value chain, allowing it to move with less friction and waste.

Operations and maintenance are a natural place for API harmonization to start. Standardized APIs also can enable operators to aggregate and use environmental, equipment and systems, health and safety, and other data. That will accelerate digital transformation in oil and gas and enable companies to leverage innovative solutions coming from the ecosystem, reduce waste, and improve operations, making production more sustainable.

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Francois Laborie is the general manager of Cognite North Americas.

Luther Birdzell, founder and CEO of Houston-based OAG Analytics is on a mission to democratize data for his upstream oil and gas clients. Courtesy of OAG Analytics

Houston entrepreneur is using his analytics company to change the oil and gas industry

Featured Innovator

Luther Birdzell has been on a mission to democratize data for the upstream oil and gas industry since he started his company, OAG Analytics, in 2013.

For him, there's just not enough data scientists for hire to do the same thing internally for different companies. He thought of a way where he can give clients an easy-to-use platform to have access to data that could save oil and gas companies millions of dollars. So, that's exactly what he did.

"Over the past five and a half years, we've built that platform," Birdzell says. "We are currently helping to optimize over $1 billion in capital deployment around drilling and completions."

The company has grown to 25 employees and tripled its revenue last year. The team is forecasting another year of high grow for 2019.

Birdzell spoke with InnovationMap to talk about his start in software, the company's growth, and why nonprofit work has been important to him as a business leader.

InnovationMap: Did you always know you wanted to be an entrepreneur?

Luther Birdzell: When I was about two years old, my grandfather ran a meat business in New York City — in the meatpacking district, back when that area actually had meat packers. It just was in my bones from a really young age that I wanted to start a business.

IM: How did you get into software development?

LB: I studied electrical engineering in college. For my first seven years, I worked within consulting, implementing systems that made data more valuable to subject matter experts. I was primarily supporting management teams and mostly tech teams.

Then, I met the founders of iTKO, who were doing software testing for clients, and I helped them figure out a way that was complementary to what they were doing. We took a capability that can enable software developers that can help companies reduce their data center costs by a lot. It was a capability that was really restricted to specialized programing. Together we figured out how to make that a capability that anyone in an IT company used. That resulted in companies being able to higher fewer people to maintain servers, as well as reduce other costs. Companies were saving of millions of dollars per year per project.

IM: When did the idea for OAG come to you?

LB: Computer Associates bought iTKO from us in 2011. When I resigned from CA in 2013, it was very clear to me that artificial intelligence, big data, machine learning, and the cloud, were all tech ingredients for adding more value to data. Then the oil and gas business came into focus.

When I founded OAG Analytics, our mission then — and still is today — was to build a platform for the upstream oil and gas industry that enables them to manage their data, introduces world-class machine learning in minutes without having to write a single line of code, and allow them to run simulations on the resulting analysis.

IM: What makes OAG successful?

LB: My vision was to create a platform that could be trusted to support billions of dollars of capital optimization through transparency and control. A black box doesn't work for the kind of problems we're helping our customers optimize. They need something that's easy to use, simple, powerful, and also gives them complete control.

IM: What's the barrier of success for your clients?

LB: We have customers who have increased their capital efficiency on drilling programs that are about $500 million by over 25 percent, while still getting the same amount of oil out of the ground.

IM: What was the early reception like?

LB: We found a lot of interest in talking about how it works. In 2013, 2014, 2015, well over half the industry knew enough about this technology from other industries to have high confidence that it would affect the oil and gas industry one day. They were willing to spend an hour or two on what it is and how it works. But the number of companies who were really willing to invest in a meaningful way was really small.

There were companies, like EOG Resources, for example started spending millions of dollars developing this technology in house. Other companies seeing EOG and Anadarko success, raised the bar on the level of proof.

There's an increasing number of companies in the industry who realize that AI isn't a futuristic thing anymore. There are companies using it today, and the companies using it right are making more money. But, they're learning it's hard to do right. It could take years and millions of dollars to develop this yourself, but we're helping companies get up to speed in a matter of months, and our total cost for the first year is well under a million bucks to do this. They want us to train them how to use it, then act as support, rather than run it all for them.

IM: Do you plan to stay in just upstream oil and gas?

LB: We're 100 percent focused on upstream oil and gas, and always have been, but as we continue to grow, we're going to follow the market and what customers want. Repurposing our platform for other applications in oil and gas, energy, and even beyond that. We're evaluating. The vision has always been to democratize AI, and oil and gas is where we started.

IM: Do you have an exit strategy?

LB: As far as exits, I get asked this a lot. I don't believe in exit strategies. I believe in building a great company. I've seen a lot of founders make a lot of mistakes trying to cut corners to get to early exits. Our goal is to be a great company, and that starts with the right vision and then getting the right people and hires.

IM: How has Houston been as a place to have a startup in energy?

LB: Houston is unparalleled in the oil patch or the ability to support day trips. There's two airports and tons of direct flights to other cities in the oil patch. It's the only city you can cover all the other cities from with day trips. The efficiency of being able to be on site with customers is such an advantage.

There are a lot of industry experts in and around Houston, but a startup software company works very differently from an oil company. I think we have a long road ahead of us before we have an ecosystem in place to support startups and give them the best chance of success. Some of that comes from advisers, some from the ecosystem, and some part of it just takes time. But once those pieces come into play, talent follows. I think Houston is a very natural hub for energy tech.

IM: Volunteering is an important part of your business. Why is that something you've focused on?

LB: Something in the DNA of our business is giving back. We do that through direct community action. We've volunteered as a company, and we're always on the lookout for ways we can engage with and make the most contribution to the community. We do this primarily for personal reasons, but the universe has been very generous over my career with reciprocating a professional upside.

You volunteer in high school to get into college, then maybe some in college. And you might think, "oh that's for philanthropists or retired people and I'll get back to that later." But the reality of that is it feels better doing some of that now, so we do.

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Portions of this interview have been edited.

Andrew Bruce had the idea for Data Gumbo when he realized how difficult it was to share data in upstream oil and gas. Courtesy of Data Gumbo

Data Gumbo CEO discusses Houston's startup ecosystem and goals for his company

Featured innovator

For Andrew Bruce, an oil and gas professional and entrepreneur, there's nothing like Houston.

"I've lived in Boston, New York, and London, and I've spent a lot of time in Norway," Bruce says. "They are all wonderful places, but I've never experienced anything quite like Houston."

After a long career in oil and gas, Bruce found himself a victim of the oil downturn. Once laid off, he decided to focus on a new idea for a way to provide access to upstream oil and gas data to companies. He founded Data Gumbo Corp., a blockchain-as-a-service company based in Houston, in 2016. The company closed its seed round last year and is moving toward a series A.

While Bruce credits his trajectory from laid off to startup CEO to a lot of hard work and a bit of blind luck, he says that Houston's people and the help they are willing to provide has been extremely beneficial to the growth of Data Gumbo.

"I'm just brainstorming, but I think a lot of [what makes Houston great for startups] comes from the fact that we all recognize the cyclical nature of the oil and gas industry, we are obligated to look out for each other even when people are laid off," Bruce says. "Maybe it comes from that kind of recognition that we're all in this together and we have to try to work through it."

InnovationMap: Tell me a little bit about your background.

Andrew Bruce: Started out as a programmer, and was transferred from New York City to Houston to build a consulting practice for financial systems. My background originally in London was building systems for the deregulation of banking industry that was happening in the mid 80s.

When I came to houston, I got involved in energy trading systems. I built a small software startup, and eventually got involved in National Oilwell Varco and the drilling business. As part of that, I kicked off a program called NOVOS to build an autonomous drilling rig. Came across the challenge of not having access to data for that rig. Data Gumbo was a direct result of that.

I started Data Gumbo to solve the problem of not being able to get data from industrial installations. Along the way, I came across the opportunity for blockchain because the real problem people were trying to solve was mistrust and inefficiency of the process. I stumbled into blockchain kind of backwards.

IM: How does Data Gumbo work?

AB: The whole idea is to build out the blockchain network, and provide a network that they can subscribe to and start doing business on that network. It's a service, so there's a subscription fee. It gives them access to the savings they already have available within their organizations.

IM: Who are the type of customers you're looking for?

AB: Midstream and upstream oil and gas companies, and the service companies that serve them.

IM: What was the reception like at first?

AB: Difficult. We got a lot of questions and concerns about what blockchain is, why they need it, and whether or not they can trust it. We were introducing a completely new concept to a conservative industry.

IM: What were some challenges and opportunities?

AB: No. 1 is the Operators Blockchain Consortium, which was 19 different oil companies coming together to understand blockchain and its opportunities. That's helped. And 75 percent of our early calls were sort of evangelism of explaining blockchain and how it's different from cryptocurrency. So, it was an educational process. The industry was independently going down the road of understanding the technology. And, to be perfectly honest, it was a bit of blind luck that we chose this technology that the industry was getting behind anyways.

IM: What doors does your recently closed seed round open?

AB: Now we're pursuing a series A equity round. Seed was a bridge to equity funding. It was primarily individuals in town who got behind the company and believed in what we were trying to do. They helped open some doors, but primarily it was financing to get us to series A and prove the concepts from a sales and product market fit perspective.

IM: What are you long-term goals for Data Gumbo?

AB: To take the company public and to remain independent. We believe that we want to provide a service to the customers that is independent from any other offers. We want to stay true to our roots and be a blockchain network infrastructure people can trust and rely on for not just upstream oil and gas, but also getting into trucking and shipping and other adjacent industries so we can satisfy the whole supply chain.

IM: How is it being located in Houston?

AB: Houston's startup community has been amazing. When we started this journey, it had been a while since we had any entrepreneurial contacts, so it was basically like starting from scratch. Organizations like Station Houston and, later on, The Cannon helped provided great contacts. People from those organizations — and the business community as a whole — has been really generous with their time. Houston is probably second to none when it comes to people's willingness to help.

IM: What does Houston still need to work on as an innovation ecosystem?

AB: I don't think it's Houston specifically, but a generalization is that large corporations are set up to buy from large corporations. As a small company or startup to sell to a super major is difficult because the sales cycle is so long and the requirements are set up to buy from other large companies. If there was a way for creating an entrepreneurial division of these companies so that they can experiment with and support startups, that would be tremendous. If you're a startup, you should be focused on sales, but cracking that nut within a large company is really hard.

IM: What keeps you up at night as it pertains to business?

AB: People. I've viewed my roles with a huge responsibility. There are people who make a bet on a company, whether they be investors or employees, and you've got to be able to fund the company. So, whether it be through sales revenue or fundraising, making payroll and building a company that people can get a return on their investment is a huge responsibility. So, that's what keeps me up at night — making sure that I'm repaying people's faith in what we're doing.

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Portions of this interview have been edited.

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TMC lands $3M grant to launch cancer device accelerator

cancer funding

A new business accelerator at Houston’s Texas Medical Center has received a nearly $3 million grant from the Cancer Prevention and Research Institute of Texas.

The CPRIT grant, awarded to the Texas Medical Center Foundation, will help launch the Accelerator for Cancer Medical Devices. The accelerator will support emerging innovators in developing prototypes for cancer-related medical devices and advancing them from prototype to clinical trials.

“The translation of new cancer-focused precision medical devices, often the width of a human hair, creates the opportunity to develop novel treatments for cancer patients,” the accelerator posted on the CPRIT website.

Scientist, consultant, and entrepreneur Jason Sakamoto, associate director of the TMC Center for Device Innovation, will oversee the accelerator. TMC officials say the accelerator builds on the success of TMC Innovation’s Accelerator for Cancer Therapeutics.

Each participant in the Accelerator for Cancer Medical Devices program will graduate with a device prototype, a business plan, and a “solid foundation” in preclinical and clinical strategies, TMC says. Participants will benefit from “robust support” provided by the TMC ecosystem, according to the medical center, and “will foster innovation into impactful and life-changing cancer patient solutions in Texas and beyond.”

In all, CPRIT recently awarded $27 million in grants for cancer research. That includes $18 million to attract top cancer researchers to Texas. Houston institutions received $4 million for recruitment:

  • $2 million to the University of Texas MD Anderson Cancer Center to recruit Rodrigo Romero from Memorial Sloan Kettering Cancer Center in New York City
  • $2 million to MD Anderson to recruit Eric Gardner from Weill Cornell Medicine in New York City

A $1 million grant also went to Baylor College of Medicine researcher Dr. Akiva Diamond. He is an assistant professor at the medical college and is affiliated with Baylor’s Dan L. Duncan Comprehensive Cancer Center.

Musk’s SpaceX spends $17B to acquire spectrum licenses from EchoStar

SpaceX Update

Elon Musk’s SpaceX has reached a deal worth about $17 billion with EchoStar for spectrum licenses that it will use to beef up its Starlink satellite network.

The deal for EchoStar’s AWS-4 and H-block spectrum licenses includes up to $8.5 billion in cash and up to $8.5 billion in SpaceX stock. SpaceX will make approximately $2 billion in cash interest payments on EchoStar debt through November 2027.

SpaceX and EchoStar will enter into a long-term commercial agreement which will allow EchoStar’s Boost Mobile subscribers to access SpaceX’s next generation Starlink Direct to Cell service.

Shares of EchoStar surged 19% before the market opened Monday.

Last month AT&T said that it will spend $23 billion to acquire wireless spectrum licenses from EchoStar, a significant expansion of its low- and mid-band coverage networks.

EchoStar said that it anticipates that the AT&T deal and the SpaceX transaction will resolve recent inquiries from the Federal Communications Commission about the rollout of 5G technology in the U.S. The FCC had been calling for hearings on whether Echostar was properly using the spectrum that it is now selling, and its efforts to make 5G more available to communities.

EchoStar said Monday that it will use the proceeds from the sale partly to pay down debt. Current operations of Dish TV, Sling and Hughes will not be impacted, the company said.

Houston students develop cost-effective glove to treat Parkinson's symptoms

smart glove

Two Rice undergraduate engineering students have developed a non-invasive vibrotactile glove that aims to alleviate the symptoms of Parkinson’s disease through therapeutic vibrations.

Emmie Casey and Tomi Kuye developed the project with support from the Oshman Engineering Design Kitchen (OEDK) and guidance from its director, Maria Oden, and Rice lecturer Heather Bisesti, according to a news release from the university.

The team based the design on research from the Peter Tass Lab at Stanford University, which explored how randomized vibratory stimuli delivered to the fingertips could help rewire misfiring neurons in the brain—a key component of Parkinson’s disease.

Clinical trials from Stanford showed that coordinated reset stimulation from the vibrations helped patients regain motor control and reduced abnormal brain activity. The effects lasted even after users removed the vibrotactile gloves.

Casey and Kuye set out to replicate the breakthrough at a lower cost. Their prototype replaced the expensive motors used in previous designs with motors found in smartphones that create similar tiny vibrations. They then embedded the motors into each fingertip of a wireless glove.

“We wanted to take this breakthrough and make it accessible to people who would never be able to afford an expensive medical device,” Casey said in the release. “We set out to design a glove that delivers the same therapeutic vibrations but at a fraction of the cost.”

Rice’s design also targets the root of the neurological disruption and attempts to retrain the brain. An early prototype was given to a family friend who had an early onset of the disease. According to anecdotal data from Rice, after six months of regularly using the gloves, the user was able to walk unaided.

“We’re not claiming it’s a cure,” Kuye said in the release. “But if it can give people just a little more control, a little more freedom, that’s life-changing.”

Casey and Kuye are working to develop a commercial version of the glove priced at $250. They are taking preorders and hope to release 500 pairs of gloves this fall. They've also published an open-source instruction manual online for others who want to try to build their own glove at home. They have also formed a nonprofit and plan to use a sliding scale price model to help users manage the cost.

“This project exemplifies what we strive for at the OEDK — empowering students to translate cutting-edge research into real-world solutions,” Oden added in the release. “Emmie and Tomi have shown extraordinary initiative and empathy in developing a device that could bring meaningful relief to people living with Parkinson’s, no matter their resources.”

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