Proving the Business Case for the Internet of Things

Chinese petroleum company deploys RFID tags to track downhole pipes

Steve Rogerson
February 16, 2016
Chinese petroleum and chemical corporation Sinopec Shengli Oilfield is using RFID tags in field tests to track the downhole pipes on its onshore oil site, believed to be the first UHF RFID application of its kind in the oil and gas industry.
Leveraging RFID traceable drill pipes, the Shengli Oilfield is able to track 1380 drill pipes at seven well sites using RFID handheld readers and software supplied by Chinese company VictorySoft. The pilot operation took around three months with every well opening a depth of approximately 2500 metres.
For the next stage, a well-centred antenna will be put in place to read the tag as the pipe moves through it while being tripped. With the success of the pilot, the Shengli Oilfield expects to expand the deployment of the Xplorer tags from Hong Kong company Xerafy to additional drill strings and sites in 2016.
Xplorer is a patent-pending, UHF RFID tag that is constructed with high-strength steel and polymer, and is designed to be embedded in a hole milled into the drill joint to track each individual pipe. Using RFID is key to improving the previously impossible task of tracking and capturing data on the individual pipes. Shengli Oilfield did not have an efficient way of managing its drilling pipes. The pipes were counted manually before and after the drilling process, which resulted in inaccurate inventory management, inefficient asset utilisation and potential safety risk.
The ability to track individual joints of drill pipe has opened up possibilities for improved documentation and process efficiency resulting in cost savings and risk reduction. Regulatory requirements, weather and operating conditions make China’s oilfields one of the most challenging asset management environments. During tripping operations, the drill pipes are exposed to high temperature, extreme pressure and vibrations, and chemical corrosion. The RFID tags are constructed to be able to withstand the downhole environment reliably where pressures can reach 2000bar.
The tag links to data including the ID number, steel number, size and weight, production information, last usage information, asset maintenance records and other important information. The stored information is transmitted to VictorySoft’s tracking system.
"Sinopec Shengli Oilfield has been on a look out for many years the implementation of an intelligent solution to identify and manage drill pipes to improve performance and reduce costs," said Xu Haiting, general manager of VictorySoft’s technical development department. "Xerafy’s Xplorer has opened up many important possibilities by allowing the operator to have traceability and advanced information of their processes throughout the tripping operation. The success of this RFID programme validates the readiness and value of Xerafy Xplorer UHF RFID technology for drill pipe tracking."
By using a handheld RFID reader, workers have been able to access key information both before and after scanning all drill pipes and will be able to get real-time visibility when the assets need cleaning and maintenance, including when the drills need to be scrapped. This reduces the risk of leakage and rupture accidents, which can cause the expedition to fail. With timely collection of raw data, management can use the data on-site to make quick and accurate decisions.
"The benefits of RFID tags are indisputable for drilling, sub-sea and surface operations," said Dennis Khoo, CEO of Xerafy. "The more information service and drilling companies can get about the pipe equipment before it goes into the hole, the less likely a costly delay or a catastrophic situation could happen."
Xerafy is headquartered in Hong Kong and maintains US sales and support offices in Dallas, and additional offices in the UK and China. VictorySoft has headquarters in Dongying city of Shandong Province, a research and develop centre in Jinan, branch office in Beijing, and satellite offices in Xinjiang, Sichuan, Central China (Henan).