A recent survey by management consultancy Accenture offers insight into how oil and gas companies are utilising digital technologies and how these technologies will shape the industry in the near future.
While the Oil & Gas Industry faces unique technological and operational challenges, the survey’s headline findings show that in many ways it is similar to any other trade or service industry. The survey shows that digital technology will be used as a tool to improve productivity, reduce costs, and to provide deeper and more useful analytics enabling businesses to make better, faster and more effective decisions.
Maintaining Revenue with Mobile
Digital investment over the next three to five years is predicted to focus on mobility and the Internet of Things (IoT). Investment in mobile technology – including wearables and the use of unmanned aerial vehicles (drones) – alongside cloud-based enabling technologies and services, will help businesses reduce costs and improve efficiency. This has become ever more important at a time where lower oil prices are increasing financial pressures. The survey shows that oil and gas companies recognise the power of these technologies to make processes more efficient and maintain revenues. Despite the pressure of a reduced oil price, the survey revealed that 80 per cent of respondents intend to spend the same amount, more, or significantly more on digital technology over the next three to five years.
Data Driven Decision Making
The Accenture report highlights the central role of ‘big-data’ and analytics in improving asset management and empowering strategic decision making over the next few years. While this huge area of opportunity is being utilised by some companies, this is clearly an area where there is room for growth; just 36 per cent of respondents said their company is currently investing in big data or analytics and only 13 per cent said they consider their analytics capabilities to be “fully mature”. Two thirds of respondents indicated that they plan on implementing new analytics capabilities at some point within the next three years.
The convergence of mobile, cloud and big data analytics in the Oil & Gas Industry will have profound effects for businesses. Remote monitoring and measurement over the cloud can enable passive monitoring of assets on an ongoing basis until intervention is required, substantially reducing cost. Operations in hostile and hazardous locations can be managed more efficiently and will enable organisations to control risk more effectively.
Gas is flared at oil extraction sites all over the world for safety reasons and as the main method of disposal for Oil & Gas facilities that lack the required infrastructure to capture, store, and sell natural gas. Flared gas makes up 4% of total global gas production – 4% completely wasted – which in financial terms equates to more than $20 billion. While there are a number of reasons oil and gas companies routinely flare gas, the rising level of carbon dioxide (CO2) in the earth’s atmosphere is causing global temperatures to rise and a concerted global effort to reduce emissions and the associated temperature rise is underway and gaining momentum. For gas flaring operations implementing remote and automated data streaming technologies will support the transition from measurement to management of greenhouse gasses, as the industry addresses the issue of emissions.
Real-time data can also be used to create a competitive advantage. Data retrieved from different sites can be compared to more effectively manage processes – site to site, country to country, or process to process – enabling continuous improvement over time. Best practice can be taken from top performing sites and implemented across the entire business operation.
The internet of Everything to Reduce Emissions
Increased investment in IoT alongside other digital technologies will see businesses build a fully interconnected network of people, vehicles, devices and sensors that will combine to provide analytics data which can be used to drive continuous improvement and support effective decision-making. When IoT is fully implemented, decision making will be enhanced at a strategic level, local operational level, or even via automated or artificially intelligent software or hardware solutions that can take immediate action in response to real-time data.
As the Oil & Gas Industry comes under ever-greater pressure to reduce emissions and more specifically routine flaring of gas, the first step to achieving this goal is the ability to monitor and measure flaring volumes. It is easy to see any number of applications these emerging digital technologies might enhance, even transform the management of routine gas flaring operations in the coming years. IoT and related digital tech will allow automated, remote, real-time monitoring of operations via cloud-connected devices or sensors. This will in turn enable businesses to be more responsive and better placed to utilise analytics tools to make informed decisions as the industry increasingly moves from measurement to active management of flaring and CO2 emissions.