Digitalization evolves from buzzword
to critical business need
‘Intelligent’ approach can reduce engineering, commissioning costs
Oil and gas companies have been col- lecting huge amounts of data for many ears. In 2014 BP spoke of petabytes of data becoming more common. 1 And, the situation since then has only ac-
celerated. This is not surprising, given that a
single drilling rig, for example, can generate
1 terabyte of data per day.
Unfortunately, this data collection has typi-
cally happened via many independent pieces
of equipment and systems – each with its own
data and interfaces. This has made it difficult
for people to take effective, timely decisions
due to a lack of common visualization at a
device, process, plant and enterprise level.
Managers have felt they are drowning in
data but are unable to find the information
they need when they need it. In fact, only
one percent of information collected is be-
ing made available to key decision-makers
and engineers are spending 70% of their time
looking for and manipulating data.
But, when times were good, addressing
such issues, while important, was not seen
as an urgent priority. Companies would get
to it “someday.” That day has now arrived.
This switch in mind-set over the last 18
months is partly driven by the growing realization that promise of a recovery in oil price is
looking less and less likely. In fact, two years
ago some Middle Eastern gas companies still
went ahead with large recruitment drives
thinking the price fall was a short-term blip.
They are shedding many of those same jobs
now that the “new normal” of low oil prices
has become more established.
It is also becoming clearer that traditional
approaches like layoffs and rig shutdowns
are not delivering the scale of cost reductions
required for the current margin squeeze. In-
creasingly, executives realize a new approach
is needed and that digitalization – properly
deployed – can deliver the results required.
Working with early adopters of a widespread
integrated digital approach to facilitate col-
laborative operations, ABB has proven, for
example, that cost reductions of 30% are
achievable, even more in subsea.
The new appetite for digital is evident in the
growing number of conferences, seminars and
journal articles devoted to the topic over the
last two years. Additionally, the make-up of
people actively exploring digital solutions is
evolving. Previously, information technology
(IT) specialists from the oil and gas majors
had been the ones most interested in the
topic. But, while I T managers are an important
element in facilitating the digital dream, they
are not the ones directly affected. Buy-in from
the operational side of the business is key but,
in good times, gaining sufficient engagement
from there was often difficult.
Accompanying this groundswell of change
are very pointed questions about digitalization
which indicate a greater willingness than ever
before to embrace such solutions:
• What is available to address my specific
• What evidence is there that digital works?
• Here are the gaps we have; how can these
Previously questions about digitalization
were more theoretical and conceptual. Now,
more than ever, executives are interested in
the practicalities of change.
Doing it right
With the proper will in place, the issue is how
to effect proper change. The key thing to realize is that, while transformative performance
is possible with digital, investing in technology
is not enough. People and equipment need to
work together more collaboratively and, for
that, processes and habits need to change.
Digitalization has helped Eni Norge’s
Goliat FPSO come online with lower
commissioning and engineering costs.
(All images courtesy ABB)