Property of Reed Esevier Case Study 6 NorTex Petroeum Custer An Industry/Academic Partnership to Deveop the Energy Professionas of the Future Chapter Outine The Motivation 71 The Context 72 The Soution 75 The Impact 79 What Made the Partnership Successfu? 80 The Chaenges 81 The Cost 82 With thanks to Professor Arne Graue, Department of Physics and Technoogy, University of Bergen and Najib Abusabi, Corporate University Reations Manager, Schumberger. THE MOTIVATION Norway is a resource-rich country where the vast majority of their energy comes from hydroeectric power. In 2012, Norway was the third argest natura gas exporter and the ninth argest exporter of crude oi gobay. 1 Its interest in the current and future dynamics of the energy industry is significant. For those invoved directy in the energy industry (incuding energy-reated academics) it is cear that a new energy mix is emerging and the energy andscape is changing fast. This is having a significant impact today on the economy in Norway. Energy exports have historicay been a critica part of Norway s economy. Unti recenty, the country expected to continue to export oi and gas to the USA but because of deveopments within the ast 6 8 years in the production of oi and gas from shae, US imports of hydrocarbons from Norway have diminished. It is vita that the knowedge base in Norway is broad enough to aow for an informed exporation of every aspect of the energy industry so that the economic future for the country is safeguarded regardess of changes to the energy 1. 2012 Key Word Energy Statistics, Internationa Energy Agency. Education and Training for the Oi and Gas Industry: Case Studies in Partnership and Coaboration. http://dx.doi.org/10.1016/b978-0-12-800962-8.00006-7 2014 Getenergy Limited. Pubished by Esevier Inc. A rights reserved. 71
Property of Reed Esevier 72 Case Studies in Partnership and Coaboration andscape. For this to happen, students currenty studying and researching various aspects of the industry need to be equipped to take the right decisions within the industry, they need to understand a aspects of the energy mix gobay and their knowedge must extend beyond the fossi fues that have historicay been the mainstay of the industry in Norway. The energy professionas of the future need to understand renewabes, shae and unconventiona energy sources and shoud be at the forefront of research and thinking in reation to the future of the energy business. This wi pace Norway in a strong position to buid on the existing energy skis base it enjoys. Meeting this chaenge in Norway required an improvement in the communication and coaboration between industry and academia. By forging partnerships between internationa institutions and companies at the forefront of energy production and research, students woud be abe to deveop a deep understanding of goba energy trends as we as understanding oca issues reating to the changing energy mix. In this way, the taent pipeine woud be nurtured and popuated with young peope who were abe to grasp future energy chaenges and become the next generation of energy professionas. The ony way to achieve these objectives was to broaden the circe of experience, expertise and knowedge for those currenty engaged in energy education at postgraduate eve. By putting current industry chaenges in front of these students and engaging peope from industry as teachers and by buiding internationa academic aiances the experience woud transform the knowedge, understanding and competence of the next generation of energy professionas and academics and create a breeding ground for new research, ideas and soutions to the energy chaenges we a face. A further dynamic informed this context. The demand for taent within the energy industry meant that many of those studying energy-reated courses woud eave reativey eary in their education journey as energy companies were abe to offer candidates we-paid positions within the industry. To buid the knowedge and research base for the sector, a country needs a critica mass of students who wi compete studies to PhD eve. If a student can spend 3 years earning good money rather than writing a thesis, it can be difficut for academia to compete. One way of addressing this is to incentivise students to continue their studies by making the experience more dynamic, offering students the chance for internationa exchange and demonstrating to them the quaity and reevance of their studies. This was another driver behind the deveopment of the NorTex initiative. THE CONTEXT The idea of estabishing an industry/academic coaboration between Norway and Texas focused on energy reates back to the Transatantic Science Week 2012, which was hed in Houston, when approximatey 200 Norwegian academics came to Texas to meet with American counterparts to enhance transat-
Property of Reed Esevier Case Study 6 NorTex Petroeum Custer 73 antic cooperation in research, innovation and higher education. The Norwegian deegation incuded rectors from five major universities: University of Oso, University of Bergen, University of Stavanger, University of Tromsø and The Norwegian University of Science and Technoogy (NTNU) in Trondheim. Their participation was driven by a desire to identify common interests and expore academic coaborations. University of Bergen. Photo: Marianne Røsvik; Copyright: University of Bergen. Prof George Hirasaki, Dept. of Chemica and Biomoecuar Engineering, Rice University, Texas, and Prof Arne Graue, Dept. of Physics and Technoogy, University of Bergen. Photo: Ingrid Opda; Copyright: University of Bergen.
Property of Reed Esevier 74 Case Studies in Partnership and Coaboration The reationship between Norway and Texas has both socia and industria roots. Houston the argest city in the state of Texas is considered Norway s most important energy hub outside Norway. There are neary 150 Norwegian companies operating in the Houston area with the majority paying a part in the energy and shipping sectors. 2 Companies active here incude Statoi, DNV, Aker Soutions, Kongsberg, Energy Ventures, DNB and NOV. As a consequence, Houston has become one of Norway s most important economic areas, particuary in the energy sector. The growth of Norwegian business in Texas has driven significant migration over the years. It is estimated that between 8000 and 10,000 Norwegian expats currenty ive in the Greater Houston region, making it the argest Norwegian expat community outside Scandinavia. 3 Houston, which is twinned with Stavanger, has become an important gateway for Norwegian businesses in the US. Athough Texas and Norway may seem very different, the economic and industria context is remarkaby simiar. Both are experiencing economic growth at a time when neighbouring states are strugging. And both have seen huge vaue emerging from the oi, gas and shipping sectors. The evoution of the energy industry is aso driving deveopments in associated sectors with Norwegian companies becoming active in Texas in the fied of environmenta technoogy. The poitica and economic importance of Texas from a Norwegian perspective is refected in the fact that there has been significant dipomatic activity over recent years in support of partnership and coaboration. This has invoved the visit of Norwegian pariamentary deegations, Ministers of Heath and Care Services, Ministers of Education and Research and the Minister of Petroeum and Energy. The University of Austin is a recipient of Statoi s investment programme in academia with the Norwegian energy giant providing the University with US$1 miion doars a year for 5 years to fund the promotion of research. 4 As a consequence of the increased presence of Norwegian companies and the cutura and economic ties this has generated between Norway and Texas, the concept of coaboration and partnership has gained traction and makes sense for both parties. It is within this context that the idea for NorTex was born. The broader poitica agenda is aso reevant here. The Norwegian government beieves that knowedge institutions in Norway shoud pay a roe in heping address the chaenges faced by those beyond their shores. This wi be achieved, in part, through understanding and engaging with the reaities of future energy consumption and exporing the reationship this has to cimate concerns. Furthermore, the taent gap in deveoping economies particuary those with hydrocarbon reserves is growing rapidy as energy consumption 2. Connecting the North Star with the Lone Star: A Piot Study proposing the aunch of NorTex, Norwegian Consuate Genera, Houston. 3. Connecting the North Star with the Lone Star: A Piot Study proposing the aunch of NorTex, Norwegian Consuate Genera, Houston. 4. Statoi.com news story, 19/09/2011.
Property of Reed Esevier Case Study 6 NorTex Petroeum Custer 75 increases and ong-term hydrocarbon reserves diminish. There is a goba chaenge to support the generation of new energy sources through education and research. This is particuary true for Africa where the majority of countries need to find ways of deveoping their own energy resources. With the drive for estabishing NorTex coming initiay from the Norwegian Consuate Genera based in Houston, it is cear that the poitica wi to support this type of coaboration was strong and was critica in making NorTex a reaity. Finding a way of buiding nationa energy knowedge and capacity through education and research has steadiy risen up the poitica agenda. NorTex is a refection of this. THE SOLUTION The NorTex Petroeum Custer was estabished in 2013. The objectives of the Custer are to initiate, strengthen and coordinate coaboration on petroeum-reated education and research cooperation between Norway and Texas. to assist in faciitating industry funding for adjunct and chair positions at the coaborating universities. to create and maintain a PhD exchange programme between universities in Norway and Texas as a way of broadening the knowedge and experience of the next generation of energy professionas. NorTex is a coaboration between three distinct groups: A group of three universities in Norway: University of Bergen; Norwegian University of Science and Technoogy and University of Stavanger. A group of four universities in Texas: Rice University; University of Houston; University of Texas at Austin and Texas A&M University Two industry partners: Statoi and Schumberger. The idea to estabish a petroeum custer consisting of universities and the petroeum industry in Texas and in Norway was first proposed by Professor Arne Graue (Chairman of the Executive Board of the Petroeum Research Schoo of Norway) during Transatantic Science Week (TSW12) in 2012, in part as a response to the ideas for coaboration and partnership on petroeumreated research generated at that event.
Property of Reed Esevier 76 Case Studies in Partnership and Coaboration Department of Physics and Technoogy, University of Bergen. Photo: Øystein Osen; Copyright: University of Bergen. The initia idea for NorTex revoved around a series of formaised reationships between different stakehoders. These incuded: a number of MoUs between universities in Texas and Norway; agreements between universities in Texas and the Petroeum Research Schoo of Norway; severa agreements detaiing research coaborations between universities in Norway and universities in Texas and an agreement outining Statoi s support of the University of Texas at Austin. These agreements drew, in part, on existing research coaborations between the University of Bergen, Rice University, Texas A&M and The University of Texas at Austin, which had, to that point, supported 15 individua exchange visits of researchers and students between the US and Norway. This coaboration had aready proved of significant vaue to the partners invoved, having been instrumenta in deveoping a proposa for a CO 2 fied piot test for enhanced oi recovery onshore in Texas at significanty ess cost than offshore in Norway. The resuts of this piot were of great interest to oi companies in Norway and in Texas and the coaboration aso identified severa individua researchers in the US and in Norway who were keen to spend time in the counterpart country to faciitate joint research between the universities. As such, this proved to be the piot for what ater became NorTex, demonstrating both how a petroeum custer coud coordinate research activities between partners in Norway and Texas and proving that such coaboration coud yied significant resuts for both the academic partners and the industry as a whoe. The NorTex Petroeum Custer coud buid on this idea and strengthen and expand educationa and research coaboration between Norway and Texas.
Property of Reed Esevier Case Study 6 NorTex Petroeum Custer 77 Industry partners Statoi Schumberger Industry participants Student exchanges Spin-out companies Research coaborations New patents NorTex Government Norwegian as funder Universities 3 Government Texan Universities as funder 4 Academic partners The concept of the custer was based around the compementarity of those invoved. In this, the bend of partners was critica, as was the depth of their invovement. Industry expertise needed to be brought to the fore. To this end, Statoi was invited to provide the vice president for the Board. Schumberger was aso invited to be part of the Board. Aongside these core partners, other industry representatives were invited to take part on a more informa basis. In future, the ambition is to have industry peope teaching at a participating universities. This way, they can expose students to current industry chaenges. Athough industry partners do have a roe in the funding of the initiative, NorTex is not simpy a mechanism for generating revenue from commercia partners to fund research the purpose is to create an integrated forum so that those from industry can direct and guide researchers towards the areas that are of rea need and concern. The concept is aso rooted in the varied context for the industry in both partner countries. By invoving students in exchange programmes, they are abe to draw on the experience and expertise in Norway (which is mosty offshore) and set that against the context in Texas, which is predominanty onshore. Currenty activities are focused on the exchange of PhD students between the two countries. In Norway, there is a poo of around 300 PhD students who are brought together under the umbrea of the Petroeum Research Schoo of Norway. 5 5. Figures provided by NorTex.
Property of Reed Esevier 78 Case Studies in Partnership and Coaboration This is a coaboration between the principe higher education institutions in Norway who are invoved in postgraduate petroeum-reated scientific discipines. The approach is to create coordinated, interdiscipinary coaborations between institutions and students, to coordinate ectures offered at different universities and provide intensive courses, seminars and conferences for a PhD students in Norway invoved in research projects reated to petroeum. The Petroeum Research Schoo of Norway is aso invoved in estabishing discussion groups and offers a meeting pace for PhD students and their supervisors. In Texas, there is estimated to be between 200 and 300 students at a simiar stage of educationa deveopment (i.e. invoved in PhD-eve research within petroeum-reated fieds). 6 NorTex is focused on finding ways to connect these PhD students with earning and research opportunities across the Atantic and exporing coaboration on future research between Texas and Norway. Part of the chaenge is to pace these students with the right academic partner. The other chaenge is to frame how industry partners can participate. As the NorTex custer deveops and new partners and coaborators come on board the initiative is becoming a network of resources and expertise that combines and connects the best that the research base has to offer with industry thinking, experience and resources. This is a powerfu environment within which students can earn and deveop. The size of the network and the invovement of industry represent the rea vaue industry partners and coaborators can give students access to equipment and faciities that are simpy not avaiabe within the academic word. In addition, students are given the opportunity to interact and work with individuas who have decades of industry experience. Students are aso attracted by the opportunity to trave internationay and see a different cuture. By making the experience of studying more appeaing, participating institutions are increasing the number of home-grown students who are wiing to continue their academic studies rather than eave for ucrative empoyment within the industry. The NorTex mode in regard to the PhD student exchange programme is to find oi companies who are wiing to sponsor Norwegian students to go and study in the US. This gives the oi companies the opportunity to engage with these students and, so far, the feedback from the oi companies has been very positive. The roe of industry partners can vary according to the specific requirements of the institutions invoved. Schumberger offers significant contributions in kind and bring a great dea to the partnership: They are key members of the Advisory Board that infuences NorTex strategy. They provide adjunct professors who co-teach topics with the university professors. 6. Figures provided by NorTex.
Property of Reed Esevier Case Study 6 NorTex Petroeum Custer 79 They provide experts who deiver dedicated ectures on specific industry topics. They have informed, upon invitation, the deveopment of the curricuum that the participating universities teach to students. The future for NorTex is promising. There are pans to engage in a variety of activities that further the objectives of the custer. These incude Deveoping academic courses through coaboration with NorTex partners. Hoding NorTex conferences to bring together key partners to expore ideas, concepts and coaborations in reation to the future of the energy industry this started in 2013 with a conference dedicated to the chaenge of CO 2 in enhanced oi recovery. Faciitating industry funding for adjunct and chair positions within partner institutions (as of 2014, severa companies have been identified and meetings are panned to expore the possibiities here and take the initiative forward). Promote and support important research projects in Texas and Norway and continue to shed ight on the key industry chaenges to inform the work of the academic science community. Continue to improve communication between industry and academia. Create and fufi industry ecture positions at the coaborating universities. The Executive Board of the NorTex Petroeum Custer consists of representatives from a principe partners. The current Board wi serve for three years and wi ook to demonstrate, within this time frame, the impact NorTex has had. Athough the size of the Board is efficient for the time being, it is possibe that additiona Board members wi be added if required. The number of participating companies beow Board eve is not set and may increase, but the number of university partners wi not increase during the first 3 years. THE IMPACT The first NorTex conference (hed in 2013) on CO 2 in enhanced oi recovery invoved 106 participants from 14 universities and 17 oi companies. There were 43 PhD students in attendance 13 from Norway and 30 from the US with the students paid for by the Petroeum Research Schoo of Norway. 7 The academic exchange programme has so far impacted on around 30 PhD students across the two countries with pans to doube that number in 2014 8 (depending on the eve of support garnered from industry partners). 7. Figures suppied by NorTex. 8. Figures suppied by NorTex.
Property of Reed Esevier 80 Case Studies in Partnership and Coaboration The Petroeum Research Schoo of Norway has, since the aunch of NorTex, signed five MoUs with institutions in USA, two of which are in Texas, for the exchange of students and facuty and to support research coaborations. NorTex partners are hopefu of achieving the foowing in terms of impact over the next 3 years: Participating universities in Norway and Texas exchange best practice on entrepreneurship and innovative strategies within the industry and gain a deeper understanding of how to acceerate the commerciaisation of research and the effective transfer of technoogy. New partnerships and joint ventures are created between industry and academia with the potentia that spin off consortia wi aunch that are successfu and sef-sustaining. These partnerships wi ead to joint pubications, joint patents and perhaps new ventures (in the form of start-up companies) between partners in Norway and Texas. As NorTex is ony in the start-up phase, it is difficut to gauge the impact so far. The intention of the existing Board is to assess the impact of the Custer s activities over the course of 3 years of operation and then, if required, refine the mode. At this stage, the potentia is significant as the participants who are contributing are a experts within their fieds. The partnership has been buit on a sound footing and there is poitica support for the initiative. On this basis, we shoud see positive resuts in the near future. WHAT MADE THE PARTNERSHIP SUCCESSFUL? NorTex has been ambitious in its attempt to engage with a wide range of partners. The achievements so far suggest that the partnership has been effective and we-managed. Here s why: It was decided eary on that for the energy custer to work, it needed to have geographica boundaries that refected and buit on existing socia and economic ties. To this end, the Custer was estabished between Texas and Norway (rather than bringing in other US states or other internationa partners). Strong poitica ties between the two regions were aso critica in this regard. More specificay, reationships between the key industry partners and the academic institutions were in many cases, aready estabished. In this way, NorTex was buiding on existing coaborations rather than trying to forge new partnerships. Furthermore, Statoi and Schumberger the two principe industry partners with positions on the Board aso had an estabished reationship. This mitigated any issues of competition between the two partners.
Property of Reed Esevier Case Study 6 NorTex Petroeum Custer 81 Athough NorTex represents a coaboration between a number of individua organisations, the core activities are based on biatera agreements between institutions and/or industry partners. This has proved easier to hande athough there are sti chaenges around marrying the competing agendas of different universities. The size of the Custer has been imited for the initia 3 years of operation. This wi ensure that the activities and governance of the Custer can be fuy pioted before any new partners are brought on board. The progress made so far by the NorTex Custer has been significanty attributed to the individuas invoved. It s vita that a partnership of this nature is instigated and managed by the right peope those who have a positive and coaborative mindset. As a way of engaging fuy with a partners from the beginning, NorTex estabished an interim Board. The job of this Board was to guide the estabishment of the Custer and to identify the right peope to move things forward unti the initiative was up and running. The Board was responsibe for seecting the chair and there were votes hed on a key strategic decisions with everyone having the same vote. Getting the governance right has heped keep a partners engaged and supportive. There was a degree of fexibiity in reation to the invovement of industry members. They have to be empowered to decide themseves whether they want to be paying partners (with their annua payment meeting the expenses for visiting professors and for exchange students) or whether they want to pay more of an ad hoc roe. There aso need to be opportunities for industry partners to make in-kind contributions rather than simpy providing funds. This fexibiity is ikey to ead to a greater number and range of industry partners paying a positive roe in the Custer. The success of the partnership has been based on the fact that the goas of the Custer are common for a partners. The research agenda that the universities are keen to pursue is of great vaue and interest to the industry partners (and is driven by industry needs) and, on the workforce deveopment side, the universities are keen to see their graduates move into senior industry positions. For the industry partners, they can see the vaue of educating the next generation of energy professionas. THE CHALLENGES Having aunched in 2013, the chaenges around ongoing coaboration and operation are ony now beginning to emerge. However, there were a number of obstaces during the process of estabishing NorTex that needed to be overcome: There were significant issues around the partnership between different universities. In trying to estabish a group of PhD students, you are asking
Property of Reed Esevier 82 Case Studies in Partnership and Coaboration different institutions to agree on aspects of their operation that they typicay define themseves. Questions arise around the nature of the curricuum, what the system of credits wi be and so on. Universities are very cautious about protecting their academic reputation and this can be a stumbing bock to effective coaboration. More broady, it can be difficut to bring together the sense of vaue that individua universities attribute to academic activities. This can mean that agreeing on strategic decisions is chaenging. Internationay, the chaenge is more reated to the competition that typicay exists between institutions, particuary in the US. The concept of muti-university partnerships is sti quite difficut for some, particuary those operating within the same industria sectors. The cost of invovement for smaer industry partners can be prohibitive. Furthermore, it is typicay the arger firms that are abe to take a onger term view of the research agenda. This means that ony certain types of industry partner are ikey to be attracted to NorTex uness new approaches can be deveoped to invove smaer companies. It has been chaenging to keep the size of the Custer manageabe as severa universities have been keen to invove other academic partners as this offers them the opportunity to access additiona sources of funding. It has been necessary to carefuy manage issues around inteectua property. To address this, the focus has been on pre-commercia research to avoid any activities that go into the ream of appied and commercia research. The chaenge is to keep activities at a eve where everyone benefits equay and there are no commercia benefits to specific partners. As the Custer grows, this coud become a greater chaenge. THE COST No specific figures are avaiabe for the costs of estabishing the NorTex Petroeum Custer. Some funding was provided in year one by the contributions from Statoi and this was augmented by pubic funding in Norway. In future, the chaenge is to find industry funding that can support and promote the expansion of the custer. This may work either on a workshop/event basis with an industry partner sponsoring specific activities or wi be on an annua contribution basis as is currenty the case with Statoi. The university partners are not providing direct funding but are committing the time of their staff and of those who sit on the Board. A simiar situation is in pace for industry partners incuding Schumberger who make contributions in-kind rather than financiay.
Property of Reed Esevier Case Study 6 NorTex Petroeum Custer 83 The Getenergy View The NorTex story is sti emerging. What is cear is that partnership and coaboration is at the centre of the initiative and that much has been achieved so far. But what can we earn from NorTex and what makes it unique? NorTex is about moving away from a reiance on oi and gas One of the unique features of the NorTex project is that it is highy futuristic in its thinking. Athough the energy professionas of today are undoubtedy benefitting from the experiences they gain through NorTex, the focus is on ooking at future energy sources and panning for a day when fossi fues run out. This is a chaenge for every country currenty extracting hydrocarbons and, as such, NorTex shoud be of interest across the word. The cutura connections are key The biatera and mutiatera reationships around which NorTex is buit have their roots in a ong history of economic and cutura coaboration. The ties between Norway and Texas go back decades and it is upon this history that NorTex buids. Significant poitica support is key The initia drive to estabish NorTex was part of a wider poitica agenda guided in particuar, by the Norwegian government. This support has been vita in ensuring that the initiative can take fight. MoUs need to be meaningfu The NorTex Custer was estabished, in part, through the signing of a number of MoUs between various parties. The chaenge is to ensure that these agreements carry weight and are not merey statements of intention. Without concerted activity, an MoU can mean very itte. It is currenty ony working at PhD eve The focus for NorTex is to support the deveopment of PhD students within energy-reated fieds. In part, this is because a significant emphasis for the initiative is on supporting research activities at the highest eve. This means that emergent nations woud be unikey to repicate the mode as most do not have PhD students within the fied. It woud be interesting to expore whether the mode woud work at bacheors or masters eve with a greater focus on the exchange of knowedge and experience and ess emphasis on research. It is a reativey oose arrangement which has positives and negatives The mode for NorTex is evoving. The nature of industry invovement varies according to the commitment of the partner and what they hope to get from the partnership. This suggests that the initiative faces a certain degree of uncertainty around financia sustainabiity. That said, such fexibiity aows NorTex to react and respond to what emerges. The pan to review after the first three years of operation seems wise in this regard. This is about buiding a new mode of higher education that brings academics coser to industry The evident enthusiasm of a partners (particuary the industry partners) demonstrates that NorTex is breaking new ground in connecting the academic community (and the energy eaders of tomorrow) with the industry. It wi be fascinating to see the resuts emerge as the initiative matures.
Property of Reed Esevier 84 Case Studies in Partnership and Coaboration A Note on Sustainabiity That NorTex is based on existing ong-term reationships means that it is ikey to be sustainabe. The simpicity of the arrangement and the track record so far are aso strong indicators of a bright future. That said, the activities of the Custer are based on a eve of industry funding that may not endure as the return is ong term and industry typicay thinks short term. The mode is aso ess attractive to smaer companies who may not be abe to afford to invest. A Note on Repicabiity The success of NorTex so far has ceary reied on specific conditions and externaities the poitica backing has been key, as has the existing cutura ties between the two territories. Given the right externa conditions where such reationships exists, the mode coud be repicated. There needs to be a eve of interest from participating universities and a degree of academic equivaence between the two countries. The mode aso has to be based on everaging existing reationships between industry partners and the academic community. A Note on Impact The impact so far is encouraging and the number of universities invoved is genuiney impressive (with others expressing an interest to join). Pans are in pace to doube the number of PhD exchanges in the second year and this is ikey to ead to further coaborations. The ong-term impact is harder to gauge but coud be significant with the sector benefitting from the experience, thinking and knowedge of these graduates.