Q&A With Devon Energy It’s Time To Talk About IP Protection

Abstract

Devon Energy considers its development of a new completions technology called Sealed Wellbore Pressure Monitoring (SWPM) to be one of the shale sector’s biggest breakthroughs in subsurface engineering. The approach to fracturing diagnostics represents a class of next-generation tools designed to make on-the-fly stimulation designs more practical than ever. But the innovation has done something else, too. It has raised old questions within a relatively new sector about the role of intellectual property (IP) protection. When SWPM was introduced to petrotechnicals outside of Devon, some initially questioned how or why the technique needed to be patented at all. The ingenuity behind SWPM could be boiled down to solving a math problem: How much fluid is pumped during the hydraulic fracturing treatment of one well before it travels across a known distance and applies pressure to the unperforated casing of a neighboring shut-in well? The ability to answer this question rapidly and with surety holds great value for any developer of multiwell pads. But, as some wondered, was this simply a formula that could be repeated and used as freely as a decade’s old equation found in a textbook? Was Devon being too protective over its discovery? Or was it simply being prudent? Earlier this year, Devon was granted a US patent for SWPM, the end of a process that began on a well pad in 2017. In the meantime, the company shared rights with other operators for field trials before striking a deal last summer with software developer Well Data Labs to market SWPM to the rest of the unconventional business. The drivers behind Devon’s IP strategy, what it learned while patenting SWPM, and what it hopes others in this space will take away from that experience are shared here by Chad Holeman, corporate counsel at Devon, and Kyle Haustveit, a co-inventor of SWPM and a subsurface engineering manager at Devon. JPT: Can you begin by explaining your philosophy around IP protection and how SWPM reflects that? Chad Holeman (CH): We talk about confidential and proprietary information with some degree of frequency. As an organization, I think that we’re further along on the spectrum of maturation as it relates to understanding what that means and safeguarding that information to the very best of our ability. One key is that you need to be able to differentiate trade secrets, or confidential proprietary information that you want to keep close to the vest, from the inventive concepts that you want to protect and can also commercialize, potentially monetize, or gain some other type of competitive advantage from. Inventive concepts such as SWPM fit that mold. Kyle Haustveit (KH): I think the concept of leaving value on the table is one of the biggest reasons we do this. A lot of operators have made massive investments into the digital revolution and multimillion-dollar investments into diagnostic programs to understand how we are breaking and draining the rock with our stimulations. Through all that have come a lot of new ideas.