IBM’s track record in recent wins with the petroleum industry can be attributed to its formidable track record in high –performance computing capabilities plus that most magic of all word, Linux. To figure out how seriously the IBM Linux portfolio has won the hearts and minds of petroleum industry computing buyers, start with Shell.

As executives like David Gelardi, director, IBM eServer benchmarking, told Open magazine last July, Royal Dutch Shell is a kind of Chapter One of how supercomputing clustering began moving out of the labs and into big business.

The oil exploration unit of Royal Dutch Shell announced it was working with IBM to build a Linux based supercomputer linking 1,024 servers. The announcement described how Shell was to use the clustered system to analyze seismic data and other geophysical information as part of its efforts to find new supplies of oil.

Another key industry player attracted to the IBM Linux sales message of high performance computing at an economical price was WesternGeco, an aggressive player competing in the business of seismic imaging. WesternGeco came into being after a morphing of Geco-Prakla and Western Geophysical companies. In May last year, IBM chortled off the announcement of its win: WesternGeco, looking for a cheaper way to do its intense computations than with high-priced supercomputing boxes, went for a cluster of 256 IBM eServer xSeries systems running Linux.

Commitments of this size and scope are hardly one-off sales: They are “pacts” and once the vendor is in the enterprise door, the relationships, and sales, continue. Beyond the clustered system, the Royal Dutch Shell group of companies and IBM have a five-year alliance, signed last July, supporting Shell’s creation of three worldwide hubs to standardize and consolidate its IT applications infrastructure as it revs up its deployment of e-business applications. The estimated value of that agreement exceeds $100 million—all this on the heels of their earlier announcement that the two, IBM and Shell, were collaborating on Linux deployment for seismic research.

What Shell gets in the five-year deal: IBM eServer systems, Enterprise Storage Server, tape drives, tape libraries, SAN switches, Tivoli’s storage management software, among other technologies, and options for technical support services and maintenance.

This June, WesternGeco and IBM put fresh ink on a deal for more xSeries machines to power the company’s seismic imaging efforts: two clusters of xSeries 330 machines powered by Intel Pentium III processors running Linux and Microsoft NT, with the latest clusters to run WesternGeco’s EDS (Exploration Design Software).

Continuing its hot pursuit of the oil industry with its ability to deliver on the Linux advantage, IBM has scored another high point for Linux spread in oil and gas: Landmark Graphics. Landmark, a business unit of Halliburton,  is the leading supplier of software software and services for what is known as the ‘upstream’ oil and gas industry— exploration, development, and production. This is a three-year deal where IBM will help bring their products over to Linux systems via IBM’s service and support. At Landmark Graphics, the arrangement is a story that involves not only Linux for supercomputing in the form of servers joined in a cluster to run supercomputing applications but also Linux for 3D desktop and mobile graphics programs. Landmark, according to Landmark sources, in 1984 introduced the first commercial workstation for 3D seismic interpretation. Landmark is to take its data-management, seismic processing, and interpretation software over to IBM’s eServer  systems, including Linux clusters and Intellistations, which are workstations optimized for the demands of engineers, developers, and media.

In dealing with a key industry such as petroleum, however, any computing vendor needs to demonstrate smarts in business strategy as well as technology competency. Digital Equipment Corp. is a historic case in point where sound business strategy did not always accompany technology excellence. IBM, at least in its petroleum industry performance, demonstrates another story altogether.

Enter Dr. Eric Leon, who has a postgraduate degree from the Institut Francais du Petrole. and a Doctorate in Economics from Paris and Dijon Universities. Before joining IBM in late 1994, Leon's career included serving as corporate vice president of Arthur D. Little, and as managing director of ADL’s Energy Group. Joining IBM, he already was versed in formulating technology and commercial strategies for petroleum and petrochemical complexes throughout the world. 

But Leon says he is not a rare bird when it comes to the IBM executives who address this industry. In talking to Open, Leon referred to his “colleague,” his marketing manager for petroleum, for example, who spent many years in the petroleum industry. The muscle that IBM gains in being able to work with the petroleum sector as entrusted knowledge partners, says Leon, can be attributed to Lou Gerstner, the profitability- flipping legend who served as IBM’s CEO from 1993 until March of this year.

“I have been in the petroleum industry roles for the last 25 years,” he says, "and Gerstner recruited a lot of people like me. He was looking for industry people who could show a real understanding of this industry’s needs. And our role was to attract even more people. I recruited a lot of industry people to IBM. This is understandable. Customers in this industry need to feel they’re talking to a company that not only understands their needs but understands their future.”

Leon says his key responsibility in his present role as general manager of IBM’s Global Chemical and Petroleum Industry is to be customer solution focused: “I need to look at IBM’s services and IBM’s research to ensure that what we do is applicable to clients. I need to understand the key issues the industry is facing and how IBM can help them resolve those issues.”

One of the key issues? Principally, drilling smarter in a competitive race for time: those managing the rigs wait out the days until data analysis is returned to them, and place decisions about stopping the drilling activity and moving on hold. With rigs costing millions of dollars per day, even one day saved, he says, is significant.

“Today, companies need to be more efficient in finding and producing oil. They need to process enormous quantities of data; and up to now the effort has not been very well done.”

Last year, Trevor Gatus, a WesternGeco manager in Houston, told Open magazine that the victory in choosing Linux cluster arrangement was turnaround. Using IBM systems running Linux, he said, expanded WesterGeco’s ability to evaluate drill sites. And with better price-performance, the company was completing jobs that once took eight weeks in three weeks.

 ‘Our Strategy Is To Migrate All Cluster Configurations to Linux'

Among the strategists in the front lines of the petroleum businesses ready and willing to bet on Linux is WesternGeco, a major seismic acquisition, processing, and reservoir imaging firm, headquartered in London. WesternGeco last month announced it was expanding its use of Linux for powering up its imaging system. John Close, the manager of seismic data processing operations for Europe, CIS, and Africa at WesternGeco, tells Open why Linux ranks highly at his company.

Why are you choosing IBM as your solution vendor?

CLOSE: WesternGeco’s relationship with IBM is a longstanding one where we have worked together to mutual advantage. IBM has a sound understanding of the seismic processing business and has provided equipment at the right price/performance to address our needs. Cluster technology is the current manifestation of that relationship.

Why IBM systems running Linux?

CLOSE: The use of IBM systems running Linux expands our ability to provide oil companies with detailed images or to assist oil companies in imaging potential drill sites.

Are this year's newer clusters primarily for seismic imaging?

CLOSE: All cluster hardware acquired by WesternGeco is employed primarily for seismic data processing. Our strategy is to migrate all cluster configurations to Linux. Windows is installed on legacy platforms and will be phased out in due course.

Last year, it was announced that WesternGeco bought clusters  in the form of IBM servers running Linux . Why the additional clusters?

CLOSE: General acceptance and demand for more prestack processing dictated a requirement for a substantial increase in computing power. Most specifically the industry wide demand for pre stack time migration is particularly driving the cluster adoption.

Meaning what?

“Usng the IBM hardware cluster design, of xSeries servers running Linux, they found they could process and improve the price performance of their application by a factor of 30.”

Will Linux be the operating system platform that by and large the oil and gas industry will migrate to? “If you had asked me six months ago,” answers Leon, “ I might not have been as certain. The answer is Yes. We are nearly there. It will be the standard for seismic applications in the industry.”

Leon says that over the past six months, he has been truly amazed at how fast the adoption of Linux has been. “We expected excellent price performance but this is better than what was expected.”