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Geologists Feel the Early Tremors

They Cautiously Eye the e-World

Bill Osten occupies a front-row seat in the Internet revolution.

Osten, principal geologist-Gulf Coast offshore for Phillips Petroleum in Houston, serves as co-chair of AAPG's Geological Computing Committee and webmaster for the Houston Geological Society.

E-commerce?

Call Osten skeptical.

"The negative comment I have is that I still don't like putting my credit card number out on the Internet," he said. "I've done it a couple of times, but I'm not confident about it."

Brent Fossum, senior geological advisor for Conoco in Houston, serves as the AAPG computing committee's other co-chair -- and he has an equally divided view.

"E-commerce can be good or bad," he noted. "It has to be really convenient. It has to be slick-and-quick for everybody. A lot of sites you go to aren't that quick."

Yet Osten and Fossum both agree that the spread of e-commerce will be inevitable -- and, eventually, a very good thing for the petroleum industry.

"Definitely, that's where the future is, e-business," Osten said. "One day you're going to have a palmtop computer in your hand and make your plane reservations on your way to the airport."

And despite his own reservations about companies rushing onto the Web, Fossum thinks the industry has to prepare for an e-commerce world.

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Bill Osten occupies a front-row seat in the Internet revolution.

Osten, principal geologist-Gulf Coast offshore for Phillips Petroleum in Houston, serves as co-chair of AAPG's Geological Computing Committee and webmaster for the Houston Geological Society.

E-commerce?

Call Osten skeptical.

"The negative comment I have is that I still don't like putting my credit card number out on the Internet," he said. "I've done it a couple of times, but I'm not confident about it."

Brent Fossum, senior geological advisor for Conoco in Houston, serves as the AAPG computing committee's other co-chair -- and he has an equally divided view.

"E-commerce can be good or bad," he noted. "It has to be really convenient. It has to be slick-and-quick for everybody. A lot of sites you go to aren't that quick."

Yet Osten and Fossum both agree that the spread of e-commerce will be inevitable -- and, eventually, a very good thing for the petroleum industry.

"Definitely, that's where the future is, e-business," Osten said. "One day you're going to have a palmtop computer in your hand and make your plane reservations on your way to the airport."

And despite his own reservations about companies rushing onto the Web, Fossum thinks the industry has to prepare for an e-commerce world.

"We need to pursue these applications," he said. "There may be some tripping up along the way, but companies have to pick themselves up and go forward
with it."

Wanted: Speed

Osten has bought software on the Web and he likes the ease of electronic comparison-shopping. In his heart, however, he remains a hands-on kind of customer.

"It's an intriguing option to be able to go out on the Internet and compare prices and features," he said, "but I still like to go to a store and hold (a product) in my hand."

At work, Osten can correlate well logs on his computer screen. He prefers to work with paper logs on his desk in the traditional manner. Give him a 50-inch screen, Oston joked, and he'd be much more willing to use the computer in log correlations.

For him, e-commerce provides an improved way to find and buy information.

"You can go on the Internet, outline an area on a map and send a message that says, 'How many wells do you have logs for in that area?' And you get a message back telling you how many well logs are available and how much they cost," he said.

Osten agreed that sites have to be quick-to-load for customers to stay interested. Studies have shown that the typical Internet user will wait no more than eight seconds to connect to a Web site.

"One of the limits on a lot of this Internet stuff is bandwidth," Osten said. "How fast can you connect to the Internet from where you are?

"Personally, I'm a very impatient user," he continued. "If it takes a long time, I won't go there."

Business Connections

B2B - With access to a fast, T1-line Net connection at work, going home and using a slower modem connection "kills me," Osten added. His workplace also offers convenient business-to-business (B2B) applications designed for large companies.

"The individual user can put in an invoice, put in a payment code and anyone who pulls it up later will see that invoice and code," he explained. "The B2B part is that the other company gets paid without anyone having to cut a check."

SAP AG of Germany, one of the largest developers of business software applications, provides powerful programs to many petroleum companies, Osten noted. Their e-business features haven't affected the routine of E&P professionals, however.

"The day-to-day geologists, they don't use that function," he said. "Their job is to find prospects where no one else has ever found one."

Fossum has seen Web e-businesses chasing B2B concepts, so far with limited effect.

"B2B is big techno-fluff jargon," Fossum said. "A lot of companies in the past couple of years have been make-or-break to establish themselves in B2B."

B2C - Development of online capabilities and e-commerce resources inside oil companies will shape the future of B2B in the industry, Fossum believes. For business-to-consumer e-commerce, or B2C, he predicted the question of whether to impose sales taxes on purchases made on the Internet is "going to have a real effect."

As B2B efficiencies and cost-savings emerge, e-commerce will become more widely used, he said.

And the efficiencies won't be limited to the largest companies. AAPG itself, for example, could use e-commerce tools to deliver information "easily, readily and for a fair price" to its membership, according to Fossum.

"What's in it for the members is more easily, more readily accessible technical information," he said.

Online tools play a major part in making e-commerce effective, Fossum noted. B2B works best in companies that have a well-developed computer infrastructure with good support and easy access to Internet resources.

"A lot of independent people don't have that," he said. "It's kind of a double-edged sword. Those people may need the access to information more than anybody else."

Customers In Training?

One of those independents is Randy Ray, a geophysical consultant with his own business, R^3 Exploration, in Denver.

Ray serves as president of the Rocky Mountain Association of Geologists (RMAG) and also as a vice-chairman of AAPG's Geophysical Integration Committee.

"Right now, I haven't seen that e-commerce has affected my business all that much," Ray said. "I am waiting for the ability to preview seismic data for licensing over the Internet.

"Most of these (e-businesses) seem pretty immature."

Ray might be an e-customer waiting to happen, however.

"I think I'm conditioned to start spending money over the Internet," he admitted, and he's seen e-commerce ideas that look intriguing.

He recalled visiting an e-business exhibitor at the AAPG annual meeting in New Orleans earlier this year. The company was gearing up to offer access to seismic interpretation software on a pay-for-use basis.

"As an independent consultant, I think that's really attractive," he said. "I'm not currently using it but I'd certainly be interested. To me, it's a totally new idea.

"And the advantage is, if they keep it up and running and keep all the bugs out of it, they're doing the software maintenance for you."

Denver offers a unique market for e-commerce, for several different reasons, Ray noted:

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