Russ: This is the BusinessMakers Show, heard here and online at the BusinessMakers.com. And now it's time for the Aflac BusinessMakers Flashback, brought to you by Aflac, ask about it at work. And for this morning's Flashback, we're going to roll back to last year when we had Bill Schrom, CEO of Geotrace - that very interesting company that uses mathematicians to re-look at old data to enhance the production of existing oil wells. We enter the discussion where I had asked Bill to tell us about Geotrace:

Bill: We're a sub-surface imaging company that works for oil companies around the world, we have eight locations, two here in the US, one in London, and then spattered around Norway all the way to Tripoli and Kuala Lumpur. We take a variety of sub-surface data, seismic data, core analysis data, wire line data, and integrate it into a sub-surface picture for oil companies, to help them recover more oil and gas.

Russ: OK. That does not mean that you go out and capture the data, correct?

Bill: That's correct, we don't have, as I like to call it, the big iron kind of tools, vibrator trucks or large boats, to acquire the data. We do that knowledge side of the business, taking the acquired data and putting it into an image with high resolution.

Russ: OK. Now do you go out right after these surface companies go out and capture the seismic data or are we talking about later on?

Bill: We tend to work with oil companies that are already in the process of developing a field, so it's a field that they're going to take a second look at-how can I enhance the recovery, how can I move my decline curve of the field out further? The positive for them is this helps them to either increase their revenues or decrease their costs by pointing out, "Here's an area you can do this is and here's a way to drill it that makes sense for you."

Russ: OK. When you mention the age of the field, this could be a producing oil field that's many year old, the company that owns it has been pulling oil out for quite a few years and then suddenly they might come along and engage Geotrace to come in and say, "How can we enhance the recover of what's there?"

Bill: That's correct. Probably 60 to 70 percent of our business is on what I would consider to be development versus exploration.

Russ: OK, that's interesting. And actually Geotrace does not go out and capture, necessarily, new data.

Bill: No, there are times we may recommend to a client that they go out and acquire some new data if the data is of ancient vintage and there's no possibility of increasing its resolution for the client.

Russ: OK, so generally speaking, we're talking about existing data that they probably used when they first went out and explored this field and you go back and look at it in more detail.

Bill: That's exactly what we do.

Russ: It almost sounds like magic. (laughs)

Bill: (laughs) Sometimes I think it is. No, we have a lot of great scientists and what happens is, as we get a better understanding of the Earth, we develop new algorithms to look at it and examine it and to increase the ability to better resolve a structure under the Earth.

Russ: Ok. Well tell me what kind-you mentioned scientists, how many employees are there at Geotrace today?

Bill: We have 300. They are pretty scattered, we probably have a fourth of them here in the states and the rest are kind of dispersed in remote locations.

Russ: What kinds of scientists are they?

Bill: We have mathematicians, physicists, geologists, geophysicists, and we've actually gone as far as having an astrophysicist on staff.

Russ: (laughs) Goodness gracious, well now you mention mathematicians, are these mathematicians that were just deeply, deeply into that category, not knowinging that someday they might be working for an energy related company?

Bill: Absolutely, it's kind of an interesting career track for people in that if you have a good science background, the Earth part of it can be taught to you and you can take what you've actually learned in school and then apply it to that Earth part.

Russ: Later on in the discussion, I asked Bill to tell us about a project they had done that was a big success.

Bill: A good example is right here in the US, in the Gulf of Mexico, a field that was 15 years old, two wells, and if you looked at the way the data had been interpreted from the first processing, it showed the wells connected by a sand channel and it was very clear and that's the way the company had approached the development. Well, they started to have a problem with one of the wells, it started to water up and had a pressure difference, so they brought us in and we took a look at that same old data, ran the new algorithms on it, improved the resolution of it, and what we found was that the two wells weren't connected and the sand channel did not connect and actually pinched out. So that means it kind of came together in a v-shape and pinched out and was disconnected from the second well. What that enabled our client to do was to put a third well in between and remove what is commonly called "attic pay," which was in this pinched out segment, and increase their production by 35 percent.

Russ: Wow.

Bill: As we gain more and more knowledge about the Earth and about an oil field, our assumptions about what we think is beneath the surface change, and so we have to adjust our mathematics so we can better resolve those structures.

Russ: Ok, I think that is so cool….. and that concludes our review of the interview with Bill Schrom, CEO of Geotrace and that wraps up this morning's AFLAC BusinessMakers Flashback, brought to you by Aflac, ask about it at work. You're listening to The BusinessMakers Show, heard here and online at TheBusinessMakers.com.