What Is Digital Transformation in Oil and Gas?
What Is Digital Oil & Gas Solutions Transformation? Digital transformation will have an impact on the oil and gas industry. This change will come about in many ways. Intelligent automation, eyewear, tablets, and HUDs will change how workers interact with the field. And, they will give operators instant information and data. Here are some of the challenges and opportunities the industry will face. To get ready for the digital transformation, oil and gas companies must understand the future of their industry.
Opportunities
The oil and gas industry is a leading proponent of digital transformation, and the first wave of digital technologies emerged during the 1980s and 1990s. Through these technologies, oil executives could swell wells at depths never before possible, improve their prospecting and production efforts, and reduce operational costs. Digitization is not just about adopting new technologies, though. It's also about bringing new insights and methods into oil and gas operations, enabling companies to increase their agility and make better strategic decisions.
Increasing automation and artificial intelligence have become integral to oil and gas operations. Artificial intelligence can predict leakages in near-real time, and the use of IoT sensors can increase worker safety. Increasingly, automation and AI are driving digital trends in the oil and gas industry. Government mandates for energy sustainability and greenhouse gas reduction policies are also driving these trends. However, the challenges of oil and gas digital transformation are many.
Embracing digital transformation requires a comprehensive and thorough business transformation. Oil and gas companies must embrace technology and create a culture that attracts digitally focused employees. Digital transformation is necessary for oil and gas companies to realize full value from their investments. It will also be necessary to invest in new infrastructure, such as digital hubs and cloud-based solutions. For oil and gas companies to fully benefit from digital transformation, they will need to adopt five key technologies.
Challenges
The EY Oil and Gas Digital Transformation and Workforce Survey 2020 highlights some of the biggest challenges oil and gas companies face when implementing digital transformation. These challenges stem from the fact that oil and gas companies are notoriously process-driven. Every step of the value chain is organized by rules and regulations aimed at creating a routine working environment. These rules and regulations stand in the way of effective transformation of the sector. To overcome these hurdles, oil and gas companies need to embrace digital transformation and develop the right skill sets and mindsets.
As with any industry, oil and gas companies are facing many obstacles. They face a workforce that is aging and a culture of conservatism. They also face the double challenge of being seen as environmentally unfriendly, conservative, and unable to adopt new technologies. Despite these challenges, many oil and gas companies aren't yet aware of the difficulties in embracing digital transformation. Nevertheless, they need to realize that they need to take advantage of this technology if they hope to achieve the expected benefits.
While oil prices are on the rise, oil companies need to optimize operational efficiency at existing facilities. This means reducing the number of wells and optimizing the efficiency of existing facilities. Digital transformation is a great way to achieve this goal. But despite all the challenges, the benefits of digital transformation can be seen across the entire industry. With more efficient operations, oil companies can extract the maximum value from their resources. But managing change is not an easy task, as the resources and manpower required to do so are limited.
Workforce
The oil and gas industry has seen its share of challenges in recent years, including declining production, a lack of new talent, and new regulatory frameworks aimed at limiting emissions. Now, decarbonization is the second most important area of concern for oil and gas executives. Digital transformation presents a new opportunity to be proactive in reducing emissions and energy waste. Advanced analytics can help detect failures and boost energy efficiency.
As oil and gas companies have increased their focus on digitisation, data has become a critical tool for improving business operations. To make the most of data, employees must be equipped with the necessary skill sets. This means upskilling the workforce in new technologies. New roles are emerging as a result of increased reliance on data, which requires the use of analytical and problem-solving skills. This means expanding the workforce to include people with a variety of skills, from engineers to mechanics to software specialists.
New health and safety requirements demonstrate the need for new workplace strategies, and the oil and gas industry is no exception. As the industry has embraced remote operating centers (ROCs), a single petroleum engineer can manage operations in several well sites. Other innovations have included supply chain management, which automates contracting, quality assurance, and accounting. Automation can also lead to redundancies and new skills. However, the panelists noted that there are benefits to both. The oil and gas industry can take advantage of this trend by rethinking their existing roles and engaging their workforce in the digital transformation process.