Digitalisation is affecting every sector, creating challenges and offering the opportunity to evolve and improve. It has particularly been a step forward for the oil and gas industry, where a decline in oil prices in 2014 and 2015, although with a recent growth again, has led to the need to find more efficient solutions that will generate a higher return on investment.
Digital technology could cut costs
Research into the use of digital technologies in the oil and gas industry has shown that digitalisation could cut operating costs by 3-5% in the upstream sector, and 1.5-2.5% in the downstream sector. In fact, capital expenditure as a whole could be cut by up to 20% if digital technology is embraced over the next few years.
The Internet of Things in the downstream sector
The Internet of Things (IoT) has grown over the past 5 years and has been found to show ways that real economic value can be created by using data from sensors and actuators connected by computer networks. It highlights areas that could be improved for greater working efficiency and save time and money. This is particularly true in the areas of operations management within the oil and gas sector.
How could Artificial Intelligence (AI) boost profits?
Although many new technologies are being introduced into the oil and gas sector, there is still a long way to go to reach optimum efficiency. Practices such as hydraulic fracturing and directional drilling have improved yields but AI could help to further lower costs and facilitate more accurate decision-making processes. AI processes large volumes of data and makes predictions and forecasts based on fast calculations. Alongside the IoT and data gathered by more than a trillion sensors, data can be shared and processes such as distribution, refining and operations can be improved based on this data.
Improved profitability and operability
The future for the oil and gas sector looks increasingly digitalised – and with that comes a wealth of opportunities for achieving more in terms of development and growth. Digitalisation is a topic covered in Euro Petroleum Consultants various oil, gas and petrochemicals events across the globe as well as part of ongoing and future consultancy projects.