Canadian Natural Resources Limited (CNRL), headquartered in Calgary, Alberta, is a longtime Hexagon client and one of the largest independent crude oil and natural gas producers in the world. Solutions from Hexagon PPM are used extensively at the company’s Horizon Oil Sands and Albian Sands projects. The cornerstone of Canadian Natural’s successful strategy is ensuring that it is an efficient and effective producer. CNRL is proud to support intitiatives that help develop the quality of life and economic health of the communities where it operates.
BK: Canadian Natural Resources Limited, CNRL, headquartered in Calgary, Alberta, is a longtime Hexagon PPM client and one of the largest independent crude oil and natural gas producers in the world. Solutions from Hexagon PPM are used extensively at the companies Horizon Oil Sands and Albian Sands projects. The cornerstone of CNRL’s successful strategy is ensuring that it is an efficient and effective producer. CNRL is proud to support initiatives that help develop the quality of life and economic health of the communities where it operates, which is why CNRL was selected as Hexagon PPM’s 2019 Hexagon Honouree.
Welcome to HxGN Radio. My name is Brian. Today we have Al Chan, control manager for CNRL, with us to discuss how his company utilized Hexagon PPM digital-transformation solutions for its Horizon Oil Sands and Albian Sands projects. Al, thanks for joining us today.
AC: You’re welcome. It’s good to be here.
BK: Really appreciate it. And we are very honored to have you as one of our customers and obviously very excited to have you on the show to talk about innovation in your industry. So, to get started, tell us a little bit about CNRL and what you do there.
AC: Sure thing. I’m the control systems manager, but I’m also the engineering information manager. Canadian Natural Resources Limited is one of the largest oil and gas producers in Canada. We have an oil sands facility that produces 250,000 barrels a day, up north. And we have a second oil sands facility, Albian, that produces about 100,000 barrels a day. And together we’ve been using Hexagon products for quite a while now.
BK: Well, tell me what are some of the biggest challenges that you are facing in your industry right now.
AC: Oil and gas is actually a very, very competitive industry. If you go back to 20 years ago and look at our industry, there’s only about two companies from the 20 that existed in Calgary that are still functioning. It’s a highly competitive industry. Usually, the most efficient producer survives this industry. And technology is one way that we ensure that we are the most efficient producer in our marketplace.
BK: So, technology’s helping you. What kind of a solution is it offering?
AC: First of all, it allows us to be much more productive, whether it’s a control system or whether it’s the Hexagon products. It fundamentally allows us to make decisions faster and much more accurately. It allows us to see what’s in front of us, and it pulls all the data together so we can make the proper solution. But more importantly, it allows us to push our decision making to the lowest level.
BK: Now, is technology making things a little harder, on the other side?
AC: Well, it’s only harder from the point of view that it’s new. And like everything else, you have to teach an old dog new tricks.
AC: I would argue that, by far, the benefits exceed the cost. You have to just be used to being able to change the way you do things.
BK: Mm-hmm. And that can be a challenge, of course. You’ve got people that are saying, “Well, we’ve done it this way for x amount of years, and why should we change now?”
BK: You’re seeing the benefits, you’re seeing the results, and what other benefits are you seeing at this point?
AC: I think for us—now, I’ll focus a bit more on the Hexagon products that we use.
AC: We were able to develop and use your products in a way that we developed our own models at Horizon plant. And, for example, using the Hexagon technology, we built a 3D model of our plant that’s so up to date, no one else has the equivalent in our industry. And to be able to use the information on that and deploy it to everybody’s desktop—and that’s what we’ve done—nobody else has been able to do that. That’s a definite competitive advantage, that somebody sitting at the desk can pull out engineering information instantly in a 3D visualization. And that helps them, for instance, a planner. He can immediately see the obstacles they would face in doing his plan. No one else can do that. So the idea is to be innovative and be the first in your marketplace to do these things.
BK: Now, have you had any trouble keeping up with the new tech?
AC: Oh, yeah. I think everything changes so quickly before we have a chance to actually get it out and deployed to people, it’s like, well, you’ve got the latest version out there. What are we going to do with this? So I think somewhere along the way you put your stake in the ground and say, “Well, we’ll work with this. We’ll optimize it. And then, perhaps, we’ll come back three or four years from now and look at upgrading it.”
BK: Okay. Yeah, that’s a good decision on that one, to say, “Hey, we’re going to go for the three to four years and make it happen.” All right. So, when you’re trying to innovate, though, what are some of these pain points that make it difficult when it comes to technology? I mean, like you said, things change quite a bit, but what’s it doing in a negative way, but also what’s it doing in a real positive way for you in that sense?
AC: Sure. Well, I think you’ve touched on a bit of it, Brian, earlier on. Legacy systems are always difficult to deal with, legacy from the point of view that “we’ve always done it this way” to legacy from the point of view “we’ve invested a lot of money in the systems. Why can’t we use Windows 7.0, or something like that.”
And in the oil and gas industry, of course, we’re a business. We like to say, where’s the proven track record for this? How do you know that we’re going to save and be more productive? And if you’re the first one all the gate, there’s always a certain amount of credibility and trust you have to build up. But I think if you can get on that track and you can build credibility and trust with the people that you work with or the stakeholders, that actually doesn’t become much of a barrier, and slowly, people around you will come up with ideas. In fact, that’s what happens, is the people around you come up with ideas in their job, say, “Look, if you can do this, you’ll help me a lot.” So I think the key to our innovation is not so much my group comes up with the ideas, but we have the ability to listen to the people out there, I’ll say, on the tip of the spear that says, “If you can do this, we’ll do a much better job,” and then we’re able to deliver that.
BK: Speaking of innovation, how do you identify ways to be innovative, get your team involved, brainstorm, that kind of thing too because you even just touched on that, but just curious how you pull that all together.
AC: Yeah. Well, there’s two significant sides to it. The first side, and I think that’s where companies like Hexagon come in, is we have good-enough relations that you’ll come and tell us about your technology. But on the other hand, you also ask us about where you think technology needs to go. And we’ve had a two-way exchange with Hexagon around technology development and where it helps us.
I think the other part of the coin that’s really important is you can argue that I’m a vendor within my company, my job is actually to go out and talk to all the stakeholders. And again, I talk about employees at the tip of the spear and say, “Well, tell us about your job. Tell us about your pain points.” And through that exchange of information, I said, “Well, maybe if I supplied a solution to you, will that help you?” And that’s in fact how we’ve grown our uses of Hexagon within the company. In fact, the Smart Review is deployed to about fifteen hundred desktops in our company. They use it as a day-to-day tool, much like you use a spreadsheet.
BK: So, when you ask these questions, do you find that the responses, people know really what they need and want, or do you kind of have to pull that out, because it’s always—the hard part is, how do they know what they really want? But sometimes they really do. So have you found that to be the case for you?
AC: Absolutely. And it’s a given when they don’t know their technology. But what’s amazing is you’ve had that exchange where they said, “Well, can we help you here?” And they go, “How do you help you?” And then you show them the work that you do and the products that you do. You see the light bulb go above their head. That’s when you know you’ve gotten through.
BK: Excellent. Now, you mentioned that Hexagon technology has helped you with your innovation efforts, but share a few more specific examples on how that’s happened.
AC: Certainly. We found, and it was totally unexpected, that people really, really like to think in 3D, whether you talk virtual reality, augmented reality, or, quite frankly, the SmartPlant model that you can display in your desktop. They just naturally work in 3D. So when we start demonstrating the SmartPlant model, [unclear]desktop, you’d say, “Well, this is really pretty. What can you do with it?” I said, “Well, you can pull all your engineering information out of it.” They said, “Show us how.” And we actually slowly worked our way through, people at our facility, our Horizon facilities, and they actually really just took to that. He says, “Wow. Can I use this? Can you get it to our desktop?” So our challenge was overcoming technology to get there. But that’s where traditionally you thought all the box where people said, “Well, the products are really for engineering, engineering groups to use.” We had everybody from operators to technicians to safety specialists using it. And what you did is that you made the technology simple enough that people could use it on their desktop. And I would say eight, nine, ten years ago, you’d need to be almost a piping designer to use it.
BK: Well, great to hear that. That’s good that it’s helping out. Thank you for sharing those examples. So, let’s change to—well, we’ve been talking about innovation in general, but I want to hear what innovation means to CNRL and for you.
AC: Sure. I think I can think of two things. The first one is we talked about earlier. Innovation and technology is one of the means that we use to stay competitive. Oil and gas is very competitive, and there’s no doubt about that. You know, everybody knows what the price of oil per barrel is out there. And, obviously, you want to produce that oil for less than that’s advertised, right?
AC: The second one that’s, I think, just as important is these days, when you hear all the buzzwords of the industrial Internet of Things, digital transformation, machine learning, the public and our shareholders, our stakeholders expect a company like CNRL to understand what the strategy is in that. And if we don’t have an innovation strategy that’s tied into digital transformation and all those other key themes are out there, people lose faith in our company. You know, you start to look like—I’m not sure, perhaps the term isn’t right—Rust Belt company, something like that, a company that can’t innovate and stay competitive.
BK: Sure. That’s absolutely essential.
AC: Yes, it is.
BK: So, how are you, specifically, shaping change in your industry?
AC: Well, I have a lot of passion for what I’ve been doing, especially around using the Hexagon products in operations and making operations manufacturing more efficient. And in terms of the internal development, we have, I’ll say, a very transparent skunkworks. It’s not skunkworks in that it’s secretive; it’s skunkworks in that it can move very flexible, working with your products. And what I try to do is, I’ll say, preach the gospel to all my peers in the industry and share with them, because I think it benefits all of us when I can say, “Look, this is how we use our technology, in a very nontraditional way.” And word of that slowly getting out through certainly my community, my peer community, and the response has been very favorable.
BK: So, it’s helping them helping you helping your customers.
AC: That’s right.
BK: Excellent. All right. Well, last thing I want to ask is, what does it mean for you to win the Hexagon Smart Change recognition?
AC: Well, firstly, it was a large surprise for me. I didn’t expect anything like this at all. And for me, it was a, I’ll say, peer recognition, recognition from my colleagues and peers in the industry of the fact that we were going along the right way. For the longest time, my team and myself—and I would say this has been a 15-year journey from the time that we started building our facility and committing to saying we were going to use the Hexagon products, all the way to how we used it now. We had to have faith that what we’re doing made a lot of sense. And to win the award is just simply a validation to me, because the individuals making the decision—I’m assuming it’s the senior management at Hexagon—see what’s going on in their world, never mind just my industry, and they understand where that places in an industry. So I appreciate that.
BK: Oh, that’s wonderful. Well, thank you for sharing that. Congratulations on 15 years of incredibly hard work to get this far, and congratulations on this award.
AC: Thank you, Brian.
BK: Well, Al, thank you very, very much for your time today. Really appreciate it. Thanks for answering these questions and sharing all of this. Very exciting to hear what’s going on.
AC: You’re welcome.
Thank you very much for joining us here on HxGN Radio. Have a great rest of your day.