Trends Shaping the Oil and Gas Industry
Over the past few years we’ve seen a drastic drop in oil prices, and an equally drastic shift in oil and gas companies’ business models as a result. This has driven a completely different approach to how the production of oil and gas happens throughout the world. In order for producers to remain profitable at the current price per barrel rates, companies are looking for ways to increase their productivity and efficiency by employing innovative new technologies and digital solutions across their operation.
"We are driving transformation change and utilizing technology. But ultimately the under pinning technology is changing as well"
Standardization and simplification is also another key market trend that has emerged from this new economic reality, both as something that can increase efficiencies in our customers’ operations as well decrease the complexity of the supply chain.
Challenges Oil and Gas Sector is Experiencing
There are some big business challenges facing the oil and gas industry. In today’s price environment, companies are focused on efficiency and being able to get the most out of the ground for the least amount of money. At GE O&G, we’re creating and marketing competitive position regardless of the price of oil and looking at new and efficient ways to accelerate the adoption of technology within the industry. This includes using big data and analytics to identify how producers can better optimize their assets and increase productivity and efficiencies.
At GE we emphasize the “digital thread,” looking at how we link people, processes and data across functions to improve our productivity internally with the right information and the right people so they can do their work in new different and more effective ways. I think the time is right for oil and gas companies, through the use of technology, to really transform how they operate.
Oil and Gas Sector Tackling Productivity Concerns
Technologies including Big Data, Cloud, RFIDs, and IoT are revolutionizing industrial industries around the world. The oil and gas industry however has often lagged behind other industrial sectors in adopting these technologies. There is a huge advantage in looking at other industrial industries and how they have applied these technologies within their industry and what oil and gas companies can do to apply and incorporate these technologies into their operations even more rapidly to improve productivity.
At GE we have our “GE Store,” which gives us the unique ability to tap into our global network of knowledge, technology and tools across the company and the industrial sectors we serve—aviation, energy, transportation, and more. Through the use of this network, we’re able to accelerate technology development and adoption for the oil and gas industry providing us with a really great opportunity to bring value to our customers and drive transformative change.
At the moment, technologies deployed within the oil and gas industry can drive value in so many ways, and we’re at this unique time where our focus must be prioritizing where we can achieve the best outcomes with our technology adoption and focusing on those initiatives.
Mitigating Cost and Investment Challenges
Automation and digitization is another area where companies can improve efficiencies. By automating and digitizing systems and functions companies can ensure optimal levels of efficiency and productivity. Implementation of these improvements requires a new level of thinking and a certain amount of openness on information transfers up and down between suppliers and from our customers and our overall value-chain. We are seeing mobility drive that a lot, people want to use these tools and access the information they need anywhere they are. We see technology as a way was going to solve these problems.
Virtualization is Unfolding its Features in O&G
At GE we’re focused on creating enterprise modeling for all our products, from the point of concept all the way through the end use and in production. This process creates a “Digital Twin” which is basically a virtual model of a 3-D product or asset that can be used to understand how it will behave or function under different scenarios. Through this process customers can create a virtual enterprise and in essence build it digitally before they build it physically. We use the data gathered from the sensors to virtualize the asset or product’s performance and do predictive and preventive maintenance–minimizing costly downtime.
Lower Carbon Technology—The Next Transition
The oil and gas industry has been actively adopting the transition to lower carbon technology. They recognize that there is going to continue to be increased demand for carbon-based fuels and products but we also have an obligation to future generations to ensure that these resources are developed in the most efficient and environmentally safe way possible by driving the advancement of lower carbon technology and development of more efficient technologies.
If you look at the GE portfolio of technologies, you can clearly see that we understand there will be non-traditional lower carbon and renewable technologies in the future of energy production. The world’s population is growing and every economic forecast shows, while we will continue to see increased investment in these lower carbon based energy sources, you’re going to see an increase in carbon-based energy as well.
Improving Cyber Risk Management in O&G
Cyber risk management is a huge play between technology and human risk management. The first commitment should be basic protection, protecting people from the most obvious threats within our workplace environments. Companies should also look to train their people how to protect data with protective behavior. The behavior base is often more challenging in companies than the technology side because you can assess the risks associated with that technology. At GE we have thousands of employees, not including our contractors and customers, which can expose us to risk. That is far more alarming and potential aggregate impact than the physical technology. We have to build awareness and give them the right tools and train them how to use them to protect themselves and help educate people to remain vigilant and help their neighbors and co-workers protect themselves.
One of the major challenges that CIOs are facing is the breaking down of organizational silos. This silo thinking can have a deep impact on a company’s bottom line. Insular thinking and decision-making can lead to underperformance, wasted time and increased operational cost. CIOs should look within their organizations to reduce those silos, and apply a systemic and cross-functional approach that prioritizes the end customer. Going back to this “digital thread” concept we have at GE, which allows us to link our people, digital processes and data across functions to improve our productivity internally and develop the products and solutions are customers need to be successful.
Advice as Budding O&G Technologists
We are driving transformation change and utilizing technology, but ultimately the underpinning technology is changing as well. My advice to anyone looking to enter the technology field and those already established moving through their careers, is to get excited about what technology can do for the business, always look to see to drive the adoption of those technologies to drive business value and outcomes.