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June 2015 A.T. Kearney Energy Transition Institute Gas Hydrates Taking the heat out of the burning-ice debate | Appendix A PATENT ANALYSIS

Taking the heat out of the burning-ice debate | Appendix A ... · June 2015 A.T. Kearney Energy Transition Institute Gas Hydrates Taking the heat out of the burning-ice debate | Appendix

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June 2015

A.T. Kearney Energy Transition Institute

Gas Hydrates

Taking the heat out of the burning-ice debate | Appendix A – PATENT ANALYSIS

Gas Hydrates 1

Compiled by the A.T. Kearney Energy Transition Institute

Acknowledgements

A.T. Kearney Energy Transition Institute wishes to acknowledge Ray Boswell, Technology Manager, Natural Gas Technologies, U.S. DoE / National Energy Technology Laboratory and Robert L. Kleinberg, Schlumberger Fellow, Schlumberger Doll Research for their detailed review of this FactBook. The Institute also wishes to thank the authors of this FactBook for their contribution: Benoit Decourt, Romain Debarre, and Sylvain Alias.

About the FactBook – Gas Hydrates

The role gas hydrates may play as an energy resource is a controversial, polarizing subject. Therefore, a fact-based report has been developed by the A.T. Kearney Energy Transition Institute, presenting: key concepts; the status of exploration and production technologies; the status of research, development and demonstration (R,D&D); and the environmental and safety challenges associated with the potential exploitation of this resource. This publication aims at providing stakeholders with a balanced, unbiased assessment of gas hydrates and the tools to understand them properly.

The Institute performed a literature review and engaged experts in the gas-hydrate field. The Institute also analyzed patents from 50 offices worldwide, using the Thomson Derwent World Patents Index (DWPI) database, and conducted a survey of gas-hydrate stakeholders to present the state of R,D&D and a faithful picture of current thinking among academics and industry players involved in the field. Outcomes of the DWPI analysis and the results from the survey are available in separate documents referred to as Appendix A and Appendix B.

About the A.T. Kearney Energy Transition Institute

The A.T. Kearney Energy Transition Institute is a nonprofit organization. It provides leading insights on global trends in energy transition, technologies, and strategic implications for private sector businesses and public sector institutions. The Institute is dedicated to combining objective technological insights with economical perspectives to define the consequences and opportunities for decision makers in a rapidly changing energy landscape. The independence of the Institute fosters unbiased primary insights and the ability to co-create new ideas with interested sponsors and relevant stakeholders.

Gas Hydrates

Gas Hydrates 2

Natural Gas Series

The FactBook – Gas Hydrates Appendix A – Patent Analysis

About the Patent Analysis

To support the Gas Hydrates FactBook, the A.T. Kearney Energy Transition Institute analyzed patents from 50 offices worldwide based on the Thomson Derwent World Patents Index (DWPI) database. Key outcomes of the analysis were integrated into the FactBook, while this Appendix presents the analysis in full

This report aims to provide a deep understanding of the gas-hydrate research and development (R&D) landscape. It highlights gas-hydrate patent publishing trends over recent decades, and identifies: the technologies that have generated the most interest; the countries most active in patent publishing; and the main stakeholders

Gas Hydrates 3

Executive summary (1/2)

Patent analysis highlights a growing interest in gas hydrates as a resource and the increasing involvement of Chinese research institutions

General overview of the gas-hydrate patenting landscape:

■ The number of patents filed in relation to gas hydrates has been growing at an accelerating pace since 1990. As of December 31th 2013, there were 2,933 patents, thirteen times as many as in 1990. The patenting rate in 2013 was more than seven times higher than in 1990

■ So far, the majority of patents have been published in Japan. However, over the past decade, patent filings has grown rapidlyin China, now the most active country in terms of gas-hydrate patent filing. Patenting in the U.S. – the second-most-important country, after Japan, for cumulative numbers of patents filed – remained relatively stable

■ From a technology standpoint, most patents still relate to chemistry related to natural gas and flow insurance issues caused by the formation of gas hydrates. Nevertheless, patents related to drilling and fluid recovery experienced more robust and steady growth over the past decade, mirroring increasing interest in gas hydrates as a potential energy source

■ Most patents have, so far, been filed by corporate players: chemicals companies and oil and gas firms own the largest gas-hydrate patents portfolios. Japanese conglomerate Mitsui is the world’s leading individual publisher. However, the role of research organizations, including universities and laboratories, has grown over the past decade. Since 2010, new players have become the main drivers for gas-hydrate patenting – notably Chinese research institutions

Gas Hydrates 4

Executive summary (1/2)

Patent analysis highlights a growing interest in gas hydrates as a resource and the increasing involvement of Chinese research institutions

Upstream:

■ The number of patents filed in 2013 in relation to gas-hydrates exploration and production technologies was 22 times higher than in 1990 (1,011 patents on December 31st 2013). Upstream-related patenting increased faster than the average increase in gas-hydrate patenting, mirroring growing interest in gas hydrates as a potential energy source over the past decade. With the exception of 2012, more than 100 gas-hydrate upstream-technology patents have been filed every year since 2010, compared with 10-20 a year in the 1990s

■ Japan is not the leading country in exploration and production patents: with 86 patents to date in this category, Japan is ranked fifth, after China, the U.S., the former Soviet Union and Europe. In 2013, China became the global leader, with 293 patents, ahead of the U.S. (280 patents). Activity in Europe and the former Soviet Union, meanwhile, is in decline

■ Within exploration & production, gas-hydrate patents are mostly filed under three categories: (i) drilling and fluids recovery; and, to a lesser extent, (ii) the measurement of physical and chemical properties, and (iii) equipment or products used for drilling and treating boreholes and wells

■ Research organizations are more involved in upstream gas-hydrate patents than in gas-hydrate patents in other areas, and now account for more than 40% of all upstream patents filed. However, within the upstream segment, oil and gas service companies remain dominant. Two oil and gas service companies and Swiss chemicals company Clariant are the largest patent-holders for gas-hydrate exploration and production technologies

Gas Hydrates 5

Executive summary (2/2)

Patent analysis highlights a growing interest in gas hydrates as a resource and the increasing involvement of Chinese research institutions

Exploration:

■ The number of patents filed in relation to gas-hydrate testing and measurement was negligible until the 2000s. It started to increase in the mid-2000s and has grown strongly since 2010. The bulk of these patents focus on chemical and physical properties (217 as of the end of 2013). Only a few relate to the measurement of electric and magnetic variables (20 patents),and geophysics (53 patents)

■ The vast majority of gas-hydrate testing and measurement patents have been filed in China: 167 compared with 34 in the U.S. and 27 in Japan. However, organizations in the U.S. – in particular, U.S. oil and gas service companies – have the largest patents portfolio relating to geophysics

Production:

■ The number of patents related to gas-hydrate drilling and “obtaining fluids from wells” started to increase significantly in thelate 1990s and the patenting rate accelerated in the 2000s. As of December 31st 2013, there were 536 patents in the category, compared with 33 in 1990

■ Technologies aiming to obtain fluid from wells have generated the most patents (and accounted for 59% of all production patents at the end of 2013). Drilling and well equipment and maintenance technologies come next (with 33% at end-2013), followed by control, surveying and testing technologies (8%). It is interesting to note that in the “obtaining fluids from wells” category, most patents relate to the use of heat and steam (67% of patents at the end of 2013) and to the use of chemicals orbacteria (24%)

■ In terms of gas-hydrate production-related patents, the U.S. is leading the way, with 163 patents, ahead of China (114) and the former Soviet Union (107). The largest patent publishers are U.S. oil and gas services companies, and, to a lesser extent, Chinese research organizations and oil majors

Gas Hydrates 6

Executive summary (2/2)

Patent analysis highlights a growing interest in gas hydrates as a resource and the increasing involvement of Chinese research institutions

Industrial landscape:

■ Oil and gas service companies are the most important patent publishers.

■ Chemicals companies are also deeply involved. Clariant, for example, is the largest publisher of gas-hydrate related patents in the “drilling, well equipment and well maintenance” category, and is ahead of oil and gas service companies

■ Other large industrial players in the gas-hydrate patent field include: international oil companies such Chevron, ConocoPhillipsand Shell; national oil companies such as Petrochina and China National Offshore Oil Corporation (CNOOC); and various Japanese conglomerates

Gas Hydrates 7

Summary table

Main figures

1. CAGR for Compounded Averaged Growth Rate; 2. Main patent class for gas-hydrate exploration, hence used as a proxy; 3. Main patent class for gas-hydrate production, hence used as a proxy

General overview Upstream Geophysics2Drilling and obtaining

fluids from wells3

2,993 1,011 53 536

x7.5 x9.3 - x5.7

x13 x22 x13 x16

+12% +14% +13% +13%

China China United States China

Japan China United States United States

Research

organization

Research

organization Corporate Research organization

Corporate Corporate Corporate Corporate

Increase in patenting rate

compared with 1990

Aggregated number of

patents compared with 1990

CAGR1 since 1990

Priority patent-filing office

in 2013

Leading priority office

since 1960

Leading type of publisher

in 2013

Leading type of publisher

since 1960

Number of patents as of

December 31th 2013

Gas Hydrates 8

1. Methodology ……………………………………………………………………………………………………………………………………………………… 9

2. General overview ………………………………………………………………………………………………………………………………………………… 14

2.1 Patenting trend ………………………………………………………………………………………………………………………………………………… 15

2.2 Regional breakdown ………………………………………………………………………………………………………………………………………….. 17

2.3 Technology breakdown ……………………………………………………………………………………………………………………………………….. 19

2.4 Publishers ………………………………………………………………………………………………………………………………………………………. 21

3. Upstream …………………………………………………………………………………………………………………………………………………………… 26

3.1 Patenting trend …………………………………………………………………………………………………………………………………………………. 27

3.2 Regional breakdown …………………………………………………………………………………………………………………………………………… 29

3.3 Technology breakdown ………………………………………………………………………………………………………………………………………... 32

3.4 Publishers ……………………………………………………………………………………………………………………………………………………….. 33

4. Exploration …………………………………………………………………………………………………………………………………………………………. 36

4.1 Patenting trend ………………………………………………………………………………………………………………………………………………….. 37

4.2 Measurements of chemical and physical properties ………………………………………………………………………………………………………… 39

4.3 Measurements of electric and magnetic variables ………………………………………………………………………………………………………….. 42

4.4 Geophysics ………………………………………………………………………………………………………………………………………………………. 43

5. Production ………………………………………………………………………………………………………………………………………………………….. 46

5.1 Patenting trend ………………………………………………………………………………………………………………………………………………….. 47

5.2 Regional breakdown ……………………………………………………………………………………………………………………………………………. 49

5.3 Technology breakdown ………………………………………………………………………………………………………………………………………… 51

5.4 Publishers ……………………………………………………………………………………………………………………………………………………….. 54

6. Industry landscape ………………………………………………………………………………………………………………………………………………… 56

7. Appendix & bibliography ………………………………………………………………………………………………………………………………………… 62

Table of contents

Gas Hydrates 9

1. Methodology

Gas Hydrates 10

Patents were retrieved from the DWPI database, the world's most comprehensive database of enhanced patent documents

Methodology – Thomson DWPI

Derwent world patents index (DWPI) – screen shot from database

1. For more information on the DWPI, please visit http://thomsonreuters.com/derwent-world-patents-index/

Gas Hydrates 11

A.T. Kearney Energy Transition Institute based its analysis on priority year and priority country, including patents granted and patent applications

Methodology – Study methodology

Description of the key steps undertaken in patent analysis

1. These collections includes patents published by US, Canada, Europe, Australia, WIPO, China India, Japan Indonesia, Korea, Malaysia, Singapore, Thai, Vietnam and other authorities, for more information, please visit: Thompson Innovation website; 2. A full list of IPC used is given in appendix.

• A.T. Kearney Energy Transition Institute assignee analysis was conducted based on DWPI patent assignee codeswithout distinguishing patents granted from those still in the approval phase.

• Patents were analyzed according to priority year, which is the first patent application date for a specific invention

• A.T. Kearney Energy Transition Institute analysis was conducted using both the core Derwent Word Patents Index(DWPI) and DWPI’s Asian patent collection1

• Patents were selected if the patent title, abstract or claim contained the words "gas hydrate" or "methane hydrate"

• A.T. Kearney Energy Transition Institute retrieved and assessed families of patents filed between January 1st 1960and December 31st 2013, from International Patent Documentation (INPADOC). This enabled to regroup all thepatents directly or indirectly linked to a priority document and consequently to single count inventions

• Geographical patent analysis was conducted according to priority patent-filing region. The choice of filing region isinfluenced by the geographical origin of the patent filer and by the region in which a publisher intends to protect aninnovation (i.e. innovation hub and potential markets).

• International Patent Classification (IPC), a hierarchical system that classifies patents with language-independentsymbols, was used to determine the technology area of patents and has been used as a proxy for identifyingpatents associated with exploration and production2.

Assignee

analysis

Patenting

rate

Selected

offices

Search

terms

Patent

retrieval

Regional

analysis

Technology

analysis

Gas Hydrates 12

Patents have been grouped in accordance with the International Patent Classification (IPC)

Methodology – Study methodology

How were IPC Classes grouped for exploration & production?1

1. Details of IPC classes used in the analysis are available in appendix on slide 6 For more information, please visit the Word Intellectual Property Organization website; 2. No patents were retrieved under this IPC code

Exploration and production IPCs

G01N: Measurement of chemical or physical properties G01R: Measurement of electric or magnetic variablesG01V: Geophysics and gravitational measurements

G01V 1/00: Seismic or acoustic prospecting or detectingG01V 3/00: Electric or magnetic prospecting or detectingG01V 5/00: Prospecting or detection by the use of nuclear radiationG01V 7/00: Gravimetric prospecting or detection2

G01V 8/00: Prospecting or detection by optical meansG01V 9/00 to G01V 15/00: Other prospecting methods

E21B: Earth or rock drilling; Obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells

E21B 1/00 to E21B 41/00: drilling, well equipment and maintenanceE21B 43/00: Obtaining fluids from wellsE21B 44//00: to E21B 49/00: Well control, surveying and testing

C09K008: Chemical compositions for drilling or treating boreholes or wells

Gas Hydrates 13

Patents have been grouped in accordance with the International Patent Classification (IPC)

Methodology – Study methodology

1. Some observers have also expressed concerns about the quality of patents currently being granted in China, specifically around the distinction between design and utility patents

• It should be noted that patents are commonly filed under several International Patent Classification (IPC) classes and inseveral priority countries. This can explain discrepancies between figures (e.g. while 208 patents were published for gashydrates in 2010, patents listed by country breakdown amount to 212 for the same year)

Discrepancies

between

numbers

• International Patent Classification (IPC), a hierarchical system that classifies patents with language-independent symbols, wasused to determine the technology area of patents. Due to the complexity of IPC categorization, technology breakdowns maynot be exhaustive. For instance, three IPCs (G01V, G01N, and G01R) were used as proxy for “exploration”. However, a fewexploration-related patents may have been filed under other IPCs

Technology

analysis

• Searches were performed in English. These capture the vast majority of commercially relevant patents and patent families(Thomson Derwent World Patents Index translates patents from all national offices). But there may be a time-lag for patentapplications still in the national phase

Language

• It can take up to 18 months for some patent offices to publish patent data. As a result, there is sometimes a significantdiscrepancy between the date an invention was made and the publication of its patent

Lag in patent

publications

• The rise in patent-filings in China can partly be attributed to the backlog of patentable innovations and products developed bothby Chinese companies and foreign firms waiting to enter the Chinese market. As the Chinese patent system strengthens andIP practices mature, companies’ willingness to use its national patent system should increase further1

Patents

issued in

China

• Only a limited amount of information is available electronically on patents issued in India. This may have resulted in anunderestimate of Indian innovation in some of the focus areas of this report

Patents

issued in

India

• Despite A.T. Kearney Energy Transition Institute’s efforts to harmonize assignee names, mergers & acquisition (M&A) activityis continually changing the energy and chemicals industries and this may slightly affect the analysis

M&A and

company

identity

1

2

3

4

5

6

7

Gas Hydrates 14

2. General overview

Gas Hydrates 15

Gas-hydrate Patenting rate

The gas-hydrate patenting rate has increased steeply since the 1990s

211

187

252

208

165

194

133

220

158

213

101

119126

7990

45453335

171824

3528

0

20

40

60

80

100

120

140

160

180

200

220

240

260

x7.5

20102005200019951990

General Overview – Patenting trend

# of patents published per year1

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Gas Hydrates 16

The number of gas-hydrate related patents rose 13-fold between 1990 and 2013

0

500

1,000

1,500

2,000

2,500

3,000

x13

20102005200019951990

General Overview – Patenting trend

Gas-hydrate Patenting level

Cumulated # of patents since 1960

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Gas Hydrates 17

Since the 2000s, China’s patent publication rate has been on the rise, while Japan’s has declined

0

20

40

60

80

100

120

140

160

180

200

220

240

260

130

8979

50484234

19951990

170

212

188

252

136

223215

104

123

17

35202429

211198

2000 2005 2010

160

Europe3Former Soviet Union2 Rest of the World4ChinaUnited States KoreaJapan

General Overview – Regional breakdown

1. Some discrepancies may exist between this slide and slide 13. For more information, please refer to slide 5; 2. Includes patents filed in the Russian Federation patent office, the Ukrainian patent office and the former Soviet Union office; 3. Includes patents filed in the European patent office and in specific national patent offices in European countries; 4. Includes patents filed in the patent Cooperation Treaty Office and other national offices not mentioned above.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

# of patents published per region per year1

Gas-hydrate patenting rate by region

Gas Hydrates 18

As of 2014, Japan remains the leading country for gas-hydrate patents filed, followed by China and the U.S.

139

162

275

334

526

730

825

Korea

Rest of the World3

United States

Europe1

Former Soviet Union2

China

Japan

General Overview – Regional breakdown

1. Includes patents filed in the European patent office and national patent offices in European countries; 2. Includes patents filed in the Russian Federation patent office, the Ukrainian patent office and the former Soviet Union office; 3. Includes patents filed in the patent Cooperation Treaty Office and other national offices not mentioned above.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Cumulated # of patents since 1960

Gas-hydrate patent Filings by region

Gas Hydrates 19

Drilling and obtaining fluids from wells is the only gas-hydrate related patent class that has grown continuously since the 1990s

0000

10

20

30

40

50

60

70

80

90

100

1990 2010200520001995

Chemistry for Acyclic or carbocyclic compounds3Chemistry related to natural gas1 Drilling and fluid recovery from wells2

+11%

CAGR

-20%

CAGR

-18%

CAGR

General Overview – Technology breakdown

1. C10L: Fuels not otherwise provided for, natural gas, synthetic natural gas obtained by processes not covered by subclasses C10G or C10K, liquefied petroleum gas, use of additives to fuels or fires; 2. E21B: Earth or rock drilling, obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells; 3. C07C: Acyclic or carbocyclic compounds; CAGR for Compound Annual Average Growth Rate.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

# of patents published per IPC class per year

Patenting rate under the three main International Patent Classification (IPC) classes

Gas Hydrates 20

The bulk of gas-hydrate patents relates to chemical-based technologies

0

100

200

300

400

500

600

700

800

201020051990 1995 2000

Drilling and fluid recovery from wells3 Chemical or physical processes5

Chemistry related to natural gas2 Chemistry for Acyclic or carbocyclic compounds4 Materials for specific applications

(including treating wells or boreholes)6

+12%

+14%

+13%

+14%

+8%

2000-2013

CAGR7

General Overview – Technology breakdown

1. Patents filed under the top 5 International Patent Classification (IPC) Classes since 1960; 2. C10L: Fuels not otherwise provided for; natural gas; synthetic natural gas obtained by processes not covered by subclasses C10G or C10K; liquefied petroleum gas; use of additives to fuels or fires; 3. E21B: Earth or rock drilling; Obtaining oil, gas, water, soluble or meltablematerials or a slurry of minerals from wells; 4. C07C: Acyclic or carbocyclic compounds; 5. B01J: Chemical or physical processes, e.g. catalysis, colloid chemistry; 6. C09K: materials for applications not otherwise provided for, includes compositions for drilling of boreholes or wells; 7. CAGR for compound annual average growth rate.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Cumulated # of patents since 1960

Gas-hydrate patents by technology category1

Gas Hydrates 21

Since the mid 2000s, there has been a significant increase in the number of patents filed by research organizations

0

200

400

600

800

1,000

1,200

1,400

1,600

20102005200019951960 199019851980197519701965

Corporate - consortiumResearch organization - consortium

Research organization(s) together with corporate player(s) Corporate - single companyResearch organization - single institution

General Overview – Publishers

1. CAGR for Compound Annual Average Growth Rate Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Cumulated # of patents since 1960

Gas-hydrate Patents filed by publisher type

2000-2013

CAGR1

+16%

+12%

+13%

+21%

+26%

Gas Hydrates 22

Since 1960, most gas-hydrate patents have been filed by industrial players

58

104

205

679

1,571

Research organization - single institution

Corporate - single company

Corporate - consortium

Research organization(s) together with corporate player(s)

Research organization - consortium

General Overview – Publishers

1. This breakdown accounts for 87% of gas-hydrate patents published since 1960. The remaining 13% were published by individuals or did not contain sufficient information to be included in this graph.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Cumulated # of patents since 1960

Gas-hydrate Patents filed by publisher type

Gas Hydrates 23

The three largest publishers of patents of gas-hydrate technologies since 1960 are Japanese companies

34

40

41

46

49

50

55

65

84

404

JAPAN NAT INST ADVANCED SCIENCE AND TECHNOLOGY

BAKER HUGHES4

UNIVERSITY OF CHINA PETROLEUM3

GUANGZHOU ENERGY INSTITUTE2

CLARIANT

SCHLUMBERGER1

MITSUBISHI

CHUGOKU ELECTRIC POWER COMPANY

ROYAL DUTCH SHELL

MITSUI ENGINEERING & SHIPBUILDING

29%

2,993

71%

General Overview – Publishers

1. Includes patents published by Schlumberger, PRAD Research and Development, and M-I Swaco; 2. Includes assignees referenced under “Guangzhou Energy Inst Conversion Chinese”, and “Guangzhou Energy Res Inst Chinese Acad of Sc”; 3. Includes assignees referenced under “Univ China Petroleum East China” and “Univ China Petroleum Beijing”; 4. Includes patents published by Baker Hughes, and BJ Services.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Share of patents owned by top 10 publishers and # of patents published since 1960

Top 10 gas-hydrate patent publishers

Gas Hydrates 24

New patent publishers, which began to emerge in force in 2005, have dominated gas-hydrate patenting since 2010

0

50

100

150

1

2000

73

55

2 1

146

38

4

128

18

7 6

1990 1995

27

38

79

2005

71

2010

8376

58

86

35

58

2

MITSUI ENGINEERING & SHIPBUILDING

BAKER HUGHES4

ROYAL DUTCH SHELL

MITSUBISHI

SCHLUMBERGER1

JAPAN NAT INST ADVANCED SCIENCE AND TECHNOLOGY

CHINA NATIONAL OFFSHORE OIL CORPORATION

CLARIANT

GUANGZHOU ENERGY INSTITUTE2

UNIVESITY OF CHINA PETROLEUM3

CHUGOKU ELECTRIC POWER COMPANY

HALLIBURTON

QINGDAO INSTITUTE OF MARINE GEOLOGY

KOREA INSTITUTE OF INDUSTRIAL TECHNOLOGY

DALIAN UNIVERSITY

UNIVERSITY OF CHANGZHOU

PETROCHINA

To

p 1

0 p

ate

nt

ho

lde

rsT

op

7 p

ub

lis

he

rs5

sin

ce

20

10

General Overview – Publishers

1. Includes patents published by Schlumberger, PRAD Research and Development, and M-I Swaco; 2. Includes assignees referenced under “Guangzhou Energy Inst Conversion Chinese”, and “Guangzhou Energy Res Inst Chinese Acad of Sc”; 3. Includes assignees referenced under “Univ China Petroleum East China” and “Univ China Petroleum Beijing”; 4. Includes patents published by Baker Hughes, and BJ Services; 5. Mitsui Engineering and Shipbuilding and University of China Petroleum have been top 10 gas-hydrate patent publishers since 1960 and top 9 patent publishers since 2010.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

# of patents published per publisher per year

Top 10 gas-hydrate patent holders and top 7 publishers since 2010, publishing rate

Gas Hydrates 25

Mitsui Engineering and Shipbuilding was the main publisher of gas-hydrate related patents for ten consecutive years: 2002 to 2012

20001990 20051995 2010

MITSUBISHI

CLARIANT

SCHLUMBERGER1

CHUGOKU ELECTRIC POWER COMPANY

MITSUI ENGINEERING & SHIPBUILDING

UNIVERSITY OF CHINA PETROLEUM3

JAPAN NAT INST ADVANCED SCIENCE AND TECHNOLOGY

ROYAL DUTCH SHELL

BAKER HUGHES4GUANGZHOU ENERGY INSTITUTE2

General Overview – Publishers

1. Includes patents published by Schlumberger, PRAD Research and Development, and M-I Swaco; 2. Includes assignees referenced under “Guangzhou Energy Inst Conversion Chinese”, and “Guangzhou Energy Res Inst Chinese Acad of Sc”; 3. Includes assignees referenced under “Univ China Petroleum East China” and “Univ China Petroleum Beijing”; 4. Includes patents published by Baker Hughes, and BJ Services.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Share of # of patents per publisher per year

Top 10 gas-hydrate patent holders, publishing rate

Gas Hydrates 26

3. Upstream

Gas Hydrates 27

The patenting rate for upstream gas-hydrate technologies has increased 9-fold since 1990

102

68

103103

6366

4946

5862

39

27

38

2026

22

131514

355

17

11

0

10

20

30

40

50

60

70

80

90

100

110

2000 2010200519951990

x9.3

Exploration & Production – Patenting trend

1. Patents associated with upstream technologies were selected according to their International Patent Classification (IPC) class. For more information, please refer to slide 10.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

# of patents published per year

Patenting rate for upstream gas-hydrate technologies1

Gas Hydrates 28

There were 22 times as many gas-hydrate patents related to upstream technologies in 2013 than in 1990

0

100

200

300

400

500

600

700

800

900

1,000

1,100

x22

20102005200019951990

Exploration & Production – Patenting trend

1. Patents associated with upstream technologies were selected according to their International Patent Classification (IPC) class. For more information, please refer to slide 10.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Cumulated # of patents since 1960

Patenting level for upstream gas-hydrate Technologies1

Gas Hydrates 29

Since 2000, exploration & production patent filings have risen in China but remained static in the U.S.

0

10

20

30

40

50

60

70

80

90

100

110

1990 20101995 2000 2005

Korea Former Soviet Union3 Europe4 Rest of the World5ChinaUnited States Japan

Exploration & Production – Regional breakdown

1. Patents associated with upstream technologies were selected according to their International Patent Classification (IPC) class; 2. Some discrepancies may exist between this slide and the preceding one. For more information, please refer to slide 9; 3. Includes patents filed in the Russian Federation patent office, the Ukrainian patent office and the Former Soviet Union office; 4. Includes patents filed in the European patent office, and in specific national patent offices in European countries; 5. Includes patents filed in the patent Cooperation Treaty Office and other national offices not cited above.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

# of patents published per region per year2

Patenting rates for upstream gas-hydrate technologies by region1

Gas Hydrates 30

Since 1960, most patents relating to upstream gas-hydrate technologies have been filed in China, followed closely by the U.S.

24

53

86

125

175

280

291

United States

Japan

Former Soviet Union3

Rest of the World4

Korea

Europe2

China

Exploration & Production – Regional breakdown

1. Patents associated with upstream technologies were selected according to their International Patent Classification (IPC) class. For more information, please refer to slide 10;2. Includes patents filed in the European patent office, and in specific national patent offices in European countries; 3. Includes patents filed in the Russian Federation patent office, the

Ukrainian patent office and the Former Soviet Union office; 4. Includes patents filed in the patent Cooperation Treaty Office and other national offices not cited above.Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Cumulated # of patents since 1960

Patent filings for upstream gas-hydrate technologies by Region1

Gas Hydrates 31

In Japan and Korea, the majority of gas-hydrate-related patents are not focused on exploration and production technologies

40%

53%

52%

45%

10%

33%

17%

60%

47%

48%

55%

90%

67%

83%

United States

China

Korea

Japan

Former Soviet Union3

Rest of the World4

Europe2

Non E&PE&P

Exploration & Production – Regional breakdown

1. Patents associated with upstream technologies were selected according to their International Patent Classification (IPC) class. For more information, please refer to slide 10;2. Includes patents filed in the European patent office, and in specific national patent offices in European countries; 3. Includes patents filed in the Russian Federation patent office, the

Ukrainian patent office and the Former Soviet Union office; 4. Includes patents filed in the patent Cooperation Treaty Office and other national offices not cited above.Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Share of cumulated # of patents since 1960

Share of upstream gas-hydrate technologies by region1

Gas Hydrates 32

Among IPC classes for upstream technologies, a large share of patents have been published under the “drilling and obtaining fluids from wells” class

0

50

100

150

200

250

300

350

400

450

500

550

20102005200019951990

Drilling and obtaining fluids from wells2

Materials for specific applications (including treating boreholes or wells)3

Geophysics5

Investigation of electric or magnetic variables6

Investigation of chemical or physical properties4

Exploration & Production – Technology breakdown

1. Patents associated with upstream technologies were selected according to their International Patent Classification (IPC) class. For more information, please refer to slide 10; 2. E21B: Earth or rock drilling, obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells; 3. C09K008: Compositions for drilling of boreholes or wells, compositions for treating boreholes or wells; 4. G01N: investigating or analyzing materials by determining their chemical or physical properties; 5. From G01V: Geophysics, gravitational measurements, detecting masses or objects, tags; 6. G01R: Measuring electric variables, measuring magnetic variables; 7. CAGR for Compound Annual Growth Rate.Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

+24%

+12%

+8%

+22%

+26%

2000-2013

CAGR7

Cumulated # of patents since 1960

Upstream gas-hydrate patents by technology category1

Gas Hydrates 33

2000-2013

CAGR2

+18%

+12%

+10%

+21%

+2%

The number of upstream gas-hydrate related patents filed by research organizations has risen rapidly since the late 2000s

0

50

100

150

200

250

300

350

400

450

500

20051995 201020001990

Research organization(s) together with corporate player(s) Corporate - single company

Research organization - consortium Corporate - consortium

Research organization - single institution

Exploration & Production – Publishers

1. Patents associated with upstream technologies were selected according to their International Patent Classification (IPC) class. For more information, please refer to slide 10; 2CAGR for Compound Annual Growth Rate.Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Cumulated # of patents since 1960

Upstream gas-hydrate Patents filed by publisher type1

Gas Hydrates 34

Oil and gas service companies are leading the way in upstream gas-hydrate-related patents

8

8

8

9

9

10

10

11

11

12

14

21

23

27

30

37

47

49

CHINA NATIONAL OFFSHORE OIL CORPORATION

HALLIBURTON

BAKER HUGHES3

SCHLUMBERGER2

CLARIANT

OFFSHORE HYDROCARBON MAPPING

MITSUBISHI HEAVY INDUSTRIES

STATOIL

BASF

AIR PROD&CHEM INC

MITSUI ENGINEERING & SHIPBUILDING

ISP INVESTMENTS INC

EXXON MOBIL5

CONOCOPHILLIPS4

CHEVRON

PETROCHINA

ROYAL DUTCH SHELL

BP

34%

1,011

66%

Exploration & Production – Publishers

1. Patents associated with upstream technologies were selected according to their International Patent Classification (IPC) class. For more information, please refer to slide 10;2. Includes patents published by Schlumberger, PRAD Research and Development, and M-I Swaco; 3. Includes patents published by Baker Hughes, and BJ Services; 4. Includes patents published by ConocoPhillips, Conoco, and Phillips Petroleum company; 5. Includes patents published by Exxon Mobil, Exxon, and Mobil.Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Cumulated # of patents since 1960 and breakdown by publisher

Main upstream gas-hydrate patents publishers1

Gas Hydrates 35

The number of patents filed by the top-18 patent publishers varies widely from year to year

0

10

20

30

40

25

28

12

4

20

2000

88

12

6

13

1995

8

19

16

33

2010

30

16

19

2323

2005

3323

1990

2

BASF

AIR PROD&CHEM INC

STATOIL

CHINA NATIONAL OFFSHORE OIL CORPORATION

BP

PETROCHINA

ROYAL DUTCH SHELL

CHEVRONHALLIBURTON

BAKER HUGHES3

SCHLUMBERGER2

CLARIANT

OFFSHORE HYDROCARBON MAPPING

MITSUBISHI HEAVY INDUSTRIES

EXXON MOBIL5

CONOCOPHILLIPS4

MITSUI ENG & SHIPBUILDING

ISP INVESTMENTS INC

Exploration & Production – Publishers

1. Patents associated with upstream technologies were selected according to their International Patent Classification (IPC) class. For more information, please refer to slide 10;2. Includes patents published by Schlumberger, PRAD Research and Development, and M-I Swaco; 3. Includes patents published by Baker Hughes, and BJ Services;4. Includes patents published by ConocoPhillips, Conoco, and Phillips Petroleum company; 5Includes patents published by Exxon Mobil, Exxon, and Mobil.Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

# of patents published per publisher per year

Top-18 Upstream gas-hydrate patenting companies, publishing rate

Gas Hydrates 36

4. Exploration

Gas Hydrates 37

Measurements of chemical and physical properties is the fastest-growing of the three main IPC subclasses for gas-hydrate exploration

0

5

10

15

20

25

30

35

40

45

50

55

2008 2010 2012200620042002200019981996199419921990

Geophysics3Measurement of electric or magnetic variables2Measurement of chemical or physical properties1

Exploration – Patenting trend

Patenting rate under the three main IPC subclasses for Gas-Hydrate exploration

# of patents published per IPC per year

1. G01N IPC subclass: covers investigating or analyzing materials by determining their chemical or physical properties; 2. G01R IPC subclass: covers measuring electric variables, measuring magnetic variables; 3. From G01V IPC subclass: covers geophysics, gravitational measurements, detecting masses or objects, tags. For more information on International Patent Classification (IPC), refer to slide 10.Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Gas Hydrates 38

Since 2007, an increasing number of patents for gas-hydrate exploration have been filed in China

0

5

10

15

20

25

30

35

40

45

50

1990 20051995 2000 2010

Europe4KoreaJapan Former Soviet Union3ChinaUnited States Rest of the World5

Exploration – Patenting trend

Patenting rates for gas-hydrate-exploration patents by region1

# of patents published per region per year2

1. Exploration-related patents include the G01N, G01R and G01V International Patent Classification (IPC) classes. For more information, please refer to slide 9; 2. Data may differ from data in previous slides, as patents published in several countries are counted several times; 3. Includes patents filed in the Russian Federation patent office, the Ukrainian patent office and the former Soviet Union office; 4. Includes patents published in the European patent office, as well as patents published in specific national patent offices of European countries; 5. Includes patents published in the patent Cooperation Treaty Office and other national offices not cited above.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Gas Hydrates 39

The patent-filing rate for measurements of the chemical and physical properties of gas-hydrates has increased rapidly since the 2000s

44

18

3232

13

24

14

1

79

23

5

13

02

00000110

5

10

15

20

25

30

35

40

45

2010

x44

20001995 20051990

Exploration – Measurements of chemical and physical properties

1. Patents associated with chemical and physical properties measurements were selected as those with International Patent Classification (IPC) G01N: Investigating or analyzing materials by determining their chemical or physical properties.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Patenting rate for measurement of chemical and physical properties of gas hydrates1

# of patents published per year

Gas Hydrates 40

Patenting level for gas-hydrate chemical and physical properties measurements1

The number of patents related to the measurement of the chemical and physical properties of gas hydrates has increased 17-fold since 2000

0

20

40

60

80

100

120

140

160

180

200

220

2005200019951990

x17

2010

Exploration – Measurements of chemical and physical properties

Cumulated # of patents since 1960

1. Patents associated with chemical and physical properties measurements were selected as those with International Patent Classification (IPC) G01N: Investigating or analyzing materials by determining their chemical or physical properties.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Gas Hydrates 41

Patenting-rate analysis does not indicate a preference for any particular technology for measuring the chemical and physical properties of gas hydrates

22%

13%

Total

22%

134

20%

12%

10%

Using chemical methods8

Using magnetic resonance measurements5 Using accoustic waves7Using volume or pressure measurements3

Using optical, microwave or radiation measurements4 Using Electro-chemical, or magnetic measurements6

CA2686567A1 - “Determination of pore water content in equilibrium with gas hydrate in dispersed medium including rock, involves drying dispersed medium specimen, measuring weight, processing at preset pressure condition, and measuring final weight”

FR2984504A1 - “Device i.e. crystallization cell, for measuring and detecting presence of gas hydrate in e.g. gas processing system, has adjustment unit for adjusting temperature of end of optical fiber by controlling Peltier effect element”

KR2012099956A - “Method for measuring phase-balance point of gas hydrate, involves putting piezoelectric crystal into pressurization chamber, and measuring conductivity of sensor and resonance of piezoelectric crystal”

CN101718730A - “Method for measuring resistivity of gas hydrate and hydrate-containing deposit in situ, involves measuring resistivity of hydrate or hydrate-containing deposit with resistivity formula”

CN103267802A - “Detection device for detecting fidelity of natural gas hydrate core rock, has sound wave transducer whose one end is arranged on measuring tube wall and other end is connected to spring to realize fastening/loosening of tube wall”

US20090114387A1 - “Chemical compound identifying method for producing heavy oil from steam assisted gravity drainage well, involves determining whether combined property of molecular model is improved relative to molecular model of starting compound”

Exploration – Measurements of chemical and physical properties

1. Patents associated with measurements of chemical and physical properties were selected as those with International Patent Classification (IPC) class G01N: Investigating or analyzing materials by determining their chemical or physical properties. 2Patent titles were improved by Thomson DWPI; 3IPC Subclass G01N 5/00, G01N 7/00, G01N 19/00; 4IPC Subclasses G01N 21/00, G01N 22/00, G01N 23/00; 5IPC Subclass G01N 25/00; 6IPC Subclass G01N 27/00; 7IPC Subclass G01N 29/00; 8IPC Subclasses G01N 30/00, G01N 31/00.Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Technology breakdown for Measurements of chemical and physical properties1

Share of cumulated # of patents since 19602

Gas Hydrates 42

Patent-filing rate for Gas hydrates’ electric and magnetic variables1

The number of patents focused on the measurement of electric and magnetic variables of gas hydrates remains very low

0

5

10

15

20

19951990

x20

2005 20102000

Exploration – Measurements of electric and magnetic variables

Cumulated # of patents since 1960

1. Patents associated with the measurement of electric and magnetic variables were selected as those with International Patent Classification (IPC) class G01R: Measuring electric variables, measuring magnetic variables.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Gas Hydrates 43

The number of patents filed in relation to geophysics has increased since the mid-2000s

0

5

10

15

20

25

30

35

40

45

50

55

2005

x13

20101990 20001995

Exploration – Geophysics

Patents filed in relation to geophysics of gas hydrates1

Cumulated # of patents since 1960

1. Patents associated with geophysics were selected from International Patent Classification (IPC) class G01V: Geophysics, gravitational measurements, detecting masses or objects, tags. For more information on International Patent Classification (IPC), refer to slide 10.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Gas Hydrates 44

Since 1960, most patents related to the geophysics of gas hydrates have been filled in the United States

1

2

6

7

8

8

21

Japan

Rest of the World4

Former Soviet Union2

Korea

China

Europe3

United States

Exploration – Geophysics

Patents filed in relation to geophysics of gas hydrates by region1

Cumulated # of patents since 1960

1. Patents associated with geophysics were selected from International Patent Classification (IPC) class G01V: Geophysics, gravitational measurements, detecting masses or objects, tags. For more information on International Patent Classification (IPC), refer to slide 10; 2. Includes patents filed in the Russian Federation patent office, the Ukrainian patent office and the Former Soviet Union office; 3. Includes patents filed in the European patent office, and in specific national patent offices in European countries; 4Includes patents filed in the patent Cooperation Treaty Office and other national offices not cited above.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Gas Hydrates 45

Patents filed in relation to geophysics of gas hydrates: technology breakdown1

Seismic and acoustic technologies are the main areas of focus within geophysics, according to patenting rates

Total

57

1

29

8

16

3

Electric or magnetic prospecting or detecting4 Prospecting or detecting by optical means6

Prospecting or detecting by the use of nuclear radiation5 Other prospecting methods7Seismic or acoustic prospecting or detecting3

Exploration – Geophysics

Share of cumulated # of patent since 19602

1. Patents associated with geophysics were selected from International Patent Classification (IPC) class G01V: Geophysics, gravitational measurements, detecting masses or objects, tags; 2. Patent titles were improved by Thomson DWPI; 3. IPC Subclass G01V 1/00; 4. IPC Subclass G01V 3/00; 5. IPC Subclass G01V 5/00; 6. IPC Subclass G01V 8/00; 7. IPC

Subclasses G01V 9/00, G01V 11/00, G01V 15/00. For more information on International Patent Classification (IPC), refer to slide 10.Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

JP2003090884A - “Optical-fiber radiation monitor for diastrophism monitoring system, radiates calibration light to scintillator, to detect presence of radon based on excitation of light by scintillator”

GB2438430A - “Results analysis method for the controlled source electromagnetic surveying of e.g. oil reserves involves processing a survey data to model subterranean strata inside the region of interest accounting results in modeling outside the region”

CN101644781A - “Water saturated stratum's longitudinal and transverse waves impedance increment ratio utilizing method for identifying natural gas hydrate, involves containing hydrate in stratum when impedance increment ratio is more than threshold value”

US20040043501A1 - “Monitoring of downhole parameters and tools utilizing fiber optics the chemical parameters are measured in real time and on-line and then used to control the amount and timing of the injection of the chemicals”

CN101441274A - “Submarine seismograph for e.g. exploration of natural gas hydrate, has direct-current motor whose output shaft is connected with end of steel wire, where another end of wire is connected with inner wall of counter-balanced copper plate”

Gas Hydrates 46

5. Production

Gas Hydrates 47

Patenting rate for drilling and obtaining fluids from wells1

The patenting rate for gas-hydrate-related drilling and obtaining fluids has been increasing steadily since the 1990s

51

36

5150

3331

20

25

292828

1720

17

1311

998

012

14

9

0

5

10

15

20

25

30

35

40

45

50

55

x5.7

2010200519951990 2000

Production – Patenting trend

# of patents published per year

1. Patents associated with drilling and obtaining fluids from wells were selected as those in International Patent Classification (IPC) class E21B: Earth or rock drilling, as well as obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Gas Hydrates 48

The number of gas-hydrate related patents for drilling and obtaining fluids from wells has increased 16-folds since 1990

0

50

100

150

200

250

300

350

400

450

500

550

1995 2000

x16

2005 20101990

Production – Patenting trend

Patenting level for drilling and obtaining fluids from wells1

Cumulated # of patents since 1960

1. Patents associated with drilling and obtaining fluids from wells were selected as those with International Patent Classification (IPC) class E21B: Earth or rock drilling, as well as obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Gas Hydrates 49

Since 2002, an increasing number of patents related to drilling and obtaining fluids from wells have been filed in China

0

5

10

15

20

25

30

35

40

45

50

55

1995 2000 201020051990

Rest of the World5Former Soviet Union3 Europe4KoreaUnited States China Japan

Production – Regional breakdown

Patenting rates for drilling and obtaining fluids from wells by region1

# of patents filed per region per year2

1. Patents associated with drilling and obtaining fluids from wells were selected as those with International Patent Classification (IPC) class E21B: Earth or rock drilling, as well as obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells; 2. Some discrepancies may exist between this slide and slide 45. For more information, please refer to slide 9; 3. Includes patents filed in Russian Federation patent office, Ukrainian patent office and Former Soviet Union office; 4. Includes patents filed in European patent office, and in specific national patent offices in European countries; 5. Includes patents filed in the patent Cooperation Treaty Office and other national offices not cited.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Gas Hydrates 50

Patent filings for drilling and obtaining fluids from wells by region1

Since 1960, the majority of gas-hydrate related patents for drilling and obtaining fluids from wells have been filed in the United States

12

30

53

71

107

114

163

Rest of the World4

Europe3

Former Soviet Union2

Japan

China

United States

Korea

Production – Regional breakdown

Cumulated # of patents since 1960

1. Patents associated with drilling and obtaining fluids from wells were selected as those with International Patent Classification (IPC) class E21B: Earth or rock drilling, as well as obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells; 2. Includes patents filed in Russian Federation patent office, Ukrainian patent office and Former Soviet Union office; 3. Includes patents filed in European patent office, and in specific national patent offices in European countries; 4. Includes patents filed in the patent Cooperation Treaty Office and other national offices not cited.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Gas Hydrates 51

Patents filed in relation to drilling and obtaining fluid from wells by technology category1

Within production operations, obtaining fluid from wells has attracted increased attention

78

16

108

44

18

9

2221

16

7

10

6

12

7

4

001

5

2

45

26

43

37

2728

1615

2322

15

11

19

12

9

5445

012

12

867887

13

1

4

11011002

00000000

5

10

15

20

25

30

35

40

45

201220102006 20082004

15

20021998 200019961992 19941990

Drilling, well equipment and maintenance2 Control, surveying and testing3Obtaining fluid from well3

Production – Technology breakdown

1. Patents associated with drilling and obtaining fluids from wells were selected as those with International Patent Classification (IPC) class E21B: Earth or rock drilling, as well as obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells; 2. Drilling, well equipment and well maintenance: IPC Subclasses E21B0001 to E21B0041; 3. Obtaining fluid from wells: IPC Subclass E21B0043; 4. Control surveying and testing: IPC Subclasses E21B0044 to E21B0049.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

# of patents filed per year

Gas Hydrates 52

Most patents published for drilling and obtaining fluids from wells relate to natural-gas recovery

683

Total

8%

59%

33%

US20080135257A1 - “Hydrocarbon gases extracting process for use between sea floor and hydrate base line, involves raising overhead receiver to sea depth where pressure and temperature permit to dissociate accumulated hydrates into hydrocarbon gas”

US20040043501A1 - “Monitoring of downhole parameters and tools utilising fibre optics the chemical parameters are measured in real time and on-line and then used to control the amount and timing of the injection of the chemicals”

Control, surveying and testing5Drilling, well equipment and maintenance3 Obtaining fluids from well4

US20060124302A1 - “Well treatment composite for use in oilfield applications, e.g. treatment of subterranean formation or wellbore, comprises well treatment agent adsorbed onto water-insoluble adsorbent”

Production – Technology breakdown

Patents filed for drilling and obtaining fluids from wells by technology category1

Share of cumulated # of patents since 19602

1. Patents associated with drilling and obtaining fluids from wells were selected as those with International Patent Classification (IPC) class E21B: Earth or rock drilling, as well as obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells; 2. Patent titles were improved by Thomson DWPI; 3. Drilling, well equipment and well maintenance: IPC Subclasses E21B0001 to E21B0041; 4. Obtaining fluid from wells: IPC Subclass E21B0043; 5. Control, surveying and testing: IPC Subclasses E21B0044 to E21B0049.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Gas Hydrates 53

Technology breakdown for obtaining fluids from wells1

Among the IPC class “obtaining fluids from wells”, most patents relate to the use of chemicals and heat

Total

150

67%

24%

5%

CN102704902A - “Method for exploiting natural gas hydrate, involves selecting hydrate decomposition-promoting agent i.e. methanol, from group

consisting of salt water, where mass concentration of methanol is in specific range”

WO2007117167A1 - “Method of extracting hydrocarbon gases from hydrates in underground porous rocks, involves injecting hot water at

pulsatory high pressure from ground surface facility on porous rock formation”

CN103015959A - “Machine-thermal hydrate exploiting method, involves converting hydrate sediments to hydrate sediment particles, decomposing

mixture in decomposing chamber, and collecting gas generated from sediments in mining well”

Using heat, e.g. steam injection5Repressuring or vacuum method3 Displacing by water4 Use of chemicals or bacterial activity5

CN101818635A - “Natural gas hydrate extracting method, involves drilling extraction well on geologic body, sending liquid to water injection pipe

via high-pressure pump after liquid is heated again, and executing next extraction circulation”

EP1412615B1 - “Exploiting desired geo-productive resources from boreholes comprises placing compression plate within casing, applying

pressure in parts of flow-through chamber, and applying pressure in lower borehole chamber”

Production – Technology breakdown

1. Patents associated with obtaining fluids from wells were selected as those with International Patent Classification (IPC) class E21B 43: Methods or apparatus for obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells; 2. Patent titles were improved by Thomson DWPI; 3. IPC Subclass E21B 43/18; 4. IPC Subclass E21B 43/20; 5. IPC Subclasses E21B 43/22 E21B 43/25 E21B 43/27; 6. IPC Subclasses E21B 43/24, E21B 43/24, E21B 43/247, E21B 43/243, E21B 43/28.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Share of cumulated # of patents since 19602

Gas Hydrates 54

Since 1960, corporate players have published 43% of gas-hydrate patents relating to technologies for drilling and obtaining fluids from wells

12

19

24

165

230

Research organization - consortium

Research organization(s) together with corporate player(s)

Corporate - consortium

Research organization - single institution

Corporate - single company

Production – Publishers

1. Patents associated with drilling and obtaining fluids from wells were selected as those with International Patent Classification (IPC) class E21B: Earth or rock drilling, as well as obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells; This breakdown accounts for 84% of gas-hydrate patents published since 1960. The remaining 16% were published by individuals or did not contain sufficient information to be included in this graph.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Patent filed for drilling and obtaining fluids from wells by Publisher type1

Cumulated # of patents since 1960

Gas Hydrates 55

Schlumberger, Halliburton and Clariant are the three main patent-publishing companies for gas-hydrate drilling and recovering technologies

6

8

8

9

9

11

13

15

18

19

24

STATOIL

BP

CONOCOPHILLIPS4

PETROCHINA

CHEVRON

CHINA NATIONAL OFFSHORE OIL CORPORATION

ROYAL DUTCH SHELL

BAKER HUGHES3

SCHLUMBERGER2

CLARIANT

HALLIBURTON

536

26%

74%

Production – Publishers

1. Patents associated with drilling and obtaining fluids from wells were selected as those with International Patent Classification (IPC) class E21B: Earth or rock drilling, as well as obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells; 2. Includes patents published by Schlumberger, PRAD Research and Development, and M-I Swaco;

3. Includes patents published by Baker Hughes, and BJ Services; 4. Includes patents published by ConocoPhillips, Conoco, and Phillips Petroleum company.Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Main companies in patent publication in drilling and obtaining fluids from wells1

Cumulated # of patents since 1960 and breakdown by company

Gas Hydrates 56

6. Industry landscape

Gas Hydrates 57

Most publishers of gas-hydrate patents specialize either in exploration or in production, but seldom both

Drilling and obtaining fluids from wells1

Cumulated # of patents since 1960Geophysics2

Cumulated # of patents since 1960

1. Patents associated with drilling and obtaining fluids from wells were selected as those with International Patent Classification (IPC) class E21B: Earth or rock drilling, as well as obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells; 2. Patents associated with geophysics were selected from IPC class G01V: Geophysics, gravitational measurements, detecting masses or objects, tags. For more information on International Patent Classification (IPC), refer to slide 10; 3. Includes patents published by Schlumberger, PRAD Research and Development, and M-I Swaco; 4. Includes patents published by Baker Hughes, and BJ Services; 5. Includes patents published by ConocoPhillips, Conoco, andPhillips Petroleum company.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

68

89

9

1113

15

18

19

24

ROCK SOLID IMAGES

CHEVRON

HALLIBURTONBAKER HUGHES4

MITSUI ENG & SHIPBUILDING

OFFSHORE HYDROCARBON MAPPING

HITACHI

CLARIANT

STATOIL

CHINA NATIONAL OFFSHORE OIL CORPORATION

ROYAL DUTCH SHELL

PETROCHINA

CONOCOPHILLIPS5

BP

SCHLUMBERGER3

FUGRO

1

1

22

23

58

11

Industry landscape

Gas Hydrates 58

Schlumberger, Offshore Hydrocarbon Mapping and Rock Solid Image have strong portfolios of patents relating to geophysics technologies

1

1

2

3

4BAKER HUGHES4

MITSUI ENG & SHIPBUILDING

MITSUBISHI HEAVY INDUSTRIES

CONOCOPHILLIPS5

FUGRO

2HALLIBURTON

3HITACHI

OFFSHORE HYDROCARBON MAPPING 11

8

11

ROCK SOLID IMAGES

SCHLUMBERGER3

Seismic or acoustic prospecting or detecting6 Electric or magnetic prospecting or detecting7 Other8

Gas-Hydrate patents for geophysics by company and technology1

Cumulated # of patents since 1960

1. Patents associated with geophysics were selected from International Patent Classification (IPC) class G01V: Geophysics, gravitational measurements, detecting masses or objects, tags;2. Some discrepancies may exist between this slide and slides 41 and 55. For more information, please refer to slide 10; 3. Includes patents published by Schlumberger, PRAD Research and

Development, and M-I Swaco; 4. Includes patents published by Baker Hughes, and BJ Services; 5. Includes patents published by ConocoPhillips, Conoco, and Phillips Petroleum company; 6. IPC Subclass G01V1; 7. IPC Subclass G01V3; 8. IPC Subclasses G01V5 to G01V15.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Industry landscape

Gas Hydrates 59

Clariant is the main publisher for patents related to gas-hydrate drilling, well equipment and well maintenance, followed by Halliburton

Industry landscape

Leading publishers of patents for gas-hydrate drilling, well equipment and well maintenance1

Cumulated # of patents since 1960

1. E21B1 to E21B7 International Patent Classification (IPC) subclasses: Methods or apparatus for drilling, E21B10 to E21B12 IPC subclasses: drilling tools, E21B15 to E21B41 IPC subclasses: Other equipment or details for drilling, well equipment or well maintenance; 2. Includes patents published by Baker Hughes, and BJ Services; 3. Includes patents published by Schlumberger, PRAD Research and Development, and M-I Swaco;

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

3

4

4

8

8

9

10

15

26

STATOIL

BP

ROYAL DUTCH SHELL

BAKER HUGHES2

BASF

CLARIANT

HALLIBURTON

CHEVRON

SCHLUMBERGER3

Gas Hydrates 60

Oilfield services companies are the largest publishers of patents relating to technologies designed to obtain fluid from wells containing hydrates

3

3

3

3

3

3

3

4

4

5

5

7

8

9

9

11

11

13

16

CLARIANT

SCHLUMBERGER2

TOTAL

MITSUBISHI HEAVY INDUSTRIES

SHIMIZU CORPORATION

TAISEI CORPORATION

WORLD ENERGY SYSTEMS

BAKER HUGHES3

HALLIBURTON

PETROCHINA

CHEVRON

CHINA NATIONAL OFFSHORE OIL CORPORATION

CONOCOPHILLIPS4

ROYAL DUTCH SHELL

ATLANTIC RICHFIELD COMPANY

KAJIMA CORPORATION

BP

EXXON MOBIL3

STATOIL

Industry landscape

1. Patents associated with obtaining fluids from wells were selected as those with International Patent Classification (IPC) class E21B 43: Methods or apparatus for obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells; 2. Includes patents published by Schlumberger, PRAD Research and Development, and M-I Swaco; 3Includes patents published by Baker Hughes, and BJ Services; 4Includes patents published by ConocoPhillips, Conoco, and Phillips Petroleum company.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Companies with more than two gas-hydrate patents for obtaining fluid from wells1

Cumulated # of patents since 1960

Gas Hydrates 61

Schlumberger and Shell are the main publishers of patents relating to wellbore surveying

Industry landscape

1. Patents associated with wellbore surveying were selected as those with International Patent Classification (IPC) class E21B47: Survey of boreholes or wells; 2. Includes patents published by Schlumberger, PRAD Research and Development, and M-I Swaco; 3. Includes patents published by Baker Hughes, and BJ Services; 4Includes patents published by ConocoPhillips, Conoco, and Phillips Petroleum company.

Source: A.T. Kearney Energy Transition Institute analysis, based on Thomson DWPI (accessed October 2014)

Selected Companies with wellbore surveying gas-hydrate patents1

Cumulated # of patents since 1960

1

1

1

1

1

1

3

5

CHEVRON

PETROCHINA

HALLIBURTON

ROYAL DUTCH SHELL

CONOCOPHILLIPS4

BAKER HUGHES3

AMERICAN AUGERS

SCHLUMBERGER2

Gas Hydrates 62

Appendix

Gas Hydrates 63

International patent classification (IPC) classes used and definitions

B01J: Chemical or physical processes, e.g. catalysis, colloid chemistry; their relevant apparatus.

C07C: Acyclic or carbocyclic compounds.

C09K: Materials for applications not otherwise provided for; applications of materials not otherwise provided for.

C09K008: Compositions for drilling of boreholes or wells; Compositions for treating boreholes or wells.

C10L: Fuels not otherwise provided for; Natural gas; Synthetic natural gas obtained by processes not covered by subclasses C10G or C10K; Liquefied petroleum gas; Use of additives to fuels or fires; Fire-lighters.

E21B: Earth or rock drilling; Obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells.

E21B 1/00 to E21B 12/00: Percussion drilling; Rotary drilling; Drives for drilling, used in the borehole; Drives for drilling with combined rotary andpercussive action; Special methods or apparatus for drilling.

E21B 15/00 to E21B 41/00: Drill bits; Other drilling tools; Accessories for drilling tools.

E21B 43/00: Methods or apparatus for obtaining oil, gas, water, soluble or meltable materials or a slurry of minerals from wells.

E21B 44//00: Automatic control systems specially adapted for drilling operations, i.e. self-operating systems which function to carry out or modify a drilling operation without intervention of a human operator, e.g. computer-controlled drilling systems; Systems specially adapted for monitoring a plurality of drilling variables or conditions.

E21B 45/00 to E21B 49/00: Measuring the drilling time or rate of penetration; Survey of boreholes or wells; Testing the nature of borehole walls; Formation testing; Methods or apparatus for obtaining samples of soil or well fluids, specially adapted to earth drilling or wells.

G01N: Investigating or analyzing materials by determining their chemical or physical properties.

G01R: Measuring electric variables; Measuring magnetic variables.

G01V: Geophysics; gravitational measurements; Detecting masses or objects; Tags.

G01V 1/00: Seismology; Seismic or acoustic prospecting or detecting.

G01V 3/00: Electric or magnetic prospecting or detecting; Measuring magnetic field characteristics of the earth, e.g. declination or deviation.

G01V 5/00: Prospecting or detecting by the use of nuclear radiation, e.g. of natural or induced radioactivity.

G01V 7/00: Measuring gravitational fields or waves; Gravimetric prospecting or detecting. - No patents were retrieved under this IPC code

G01V 8/00: Prospecting or detecting by optical means.

G01 9/00 to G01 15/00: Prospecting or detecting by methods not provided for in groups G01V 1/00-G01V 8/00; Prospecting or detecting by methods combining techniques covered by two or more of main groups G01V 1/00-G01V 9/00; Manufacturing, calibrating, cleaning, or repairing instruments or devices covered by groups G01V 1/00-G01V 11/00; Tags attached to, or associated with, an object, in order to enable detection of the object.

For more information, please visit the World Intellectual Property Organization Website.

Appendix

Gas Hydrates 64

Acronyms

Acad: Academy

CNOOC: China National Offshore Oil Corporation

CSEM: Controlled source electromagnetic methods

DWPI: Derwent World Patents Index

E&P: Exploration & production

EPO: European Patent Office

FSU: Former Soviet Union

GH: Gas Hydrate

Inst: Institution

INPADOC: International Patent Documentation

IODP: Integrated Ocean Drilling Program

IP: Intellectual property

IPC: International patent classification

JAMSTEC: Japan Agency for Marine-Earth Science and Technology

NOAA: National Oceanic and Atmospheric Administration

NASA: National Aeronautics and Space Administration

OECD: Organisation for Economic Co-operation and Development

ROV: Remotely operated vehicle

Sc: Science

A.T. Kearney Energy Transition Institute: A.T. Kearney Energy Transition Institute

Univ: University

US: United States of America

USGS: U.S. Geological Survey

WIPO: World Intellectual Property Organization

Appendix

Gas Hydrates 65

Picture credits

Slide 9: Ocean Floor Geophysics performing a CSEM gas-hydrate survey in Japan in 2014, using the Scripps Institution of Oceanography Vulcan system from the deck of Fukada Shin Nichi Maru vessel, courtesy of Ocean Floor Geophysics

Slide 14: Close-up of methane hydrates, at a depth of 1,055 meters, near bubble plumes detected in previous sonar data. Observed in the U.S. North Atlantic Margin by National Oceanic and Atmospheric Administration (NOAA) during the Okeanos Explorer Program, courtesy of NOAA

Slide 26: Aerial photo of the temporary ice pad built in Alaska (U.S) for the ConocoPhillips Ignik Sikumiproduction test using CO2-CH4 exchange methodology and in the background the permanent operating gravel pads within the Prudhoe Bay Unit, courtesy of ConocoPhillips

Slide 36: View of the remotely operated vehicle (ROV) Deep Discoverer investigating Block Canyon in the U.S. North Atlantic Margin during Okeanos Explorer Program, courtesy of NOAA

Slide 46: View of Gas-hydrate stratigraphic test well, Mount Elbert, North Slope of Alaska for Ignik Sikumiproduction test, courtesy of the Mount Elbert gas hydrate stratigraphic test well project

Slide 56: Japanese deep-sea scientific drilling vessel Chikyu, built for the Integrated Ocean Drilling Program, used during Nankai Trough production test in 2014 and operated by Japan Agency for Marine-Earth Science and Technology (JAMSTEC), courtesy of JOGMEC

Slide 62: View of a test-well for collecting gas hydrates in Mallik, in the Mackenzie Delta-Beaufort Sea in Northern Canada, courtesy of the U.S. Geological Survey (USGS)

Appendix

Gas Hydrates 66

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