With the continuing uncertainty caused by the oil price collapse, many oil companies will have to revise their corporate strategy, focusing on core assets and cost discipline. This is where having an effective data and technology strategy comes in, says Emmanuel Udeh, subsurface data analyst, Beneprojecti Nigeria Ltd.
One key learning from the Big Data Analytics for Oil & Gas conference held in Abu Dhabi in April, was that real time advanced analytics utilizing data and technology will be increasingly important. These analytics are required by the oil and gas industry to maximize efficiencies of existing assets and improve decision-making, as well as reducing cost. According to the Halliburton chief data scientist, Dr. Satyam Priyadarshy, the event had come at the right time to help companies optimize their business value, even with low oil prices.
A clear example is the way todays revolution in computing power is adding value to the analyses of seismic data. BP in 2013 built the worlds largest supercomputer for commercial research, which has the capacity to perform 4,000 trillion calculations a second. This means that seismic imaging work that took a geoscientist months just a few years ago can now be done in days.
According to research by Bain & Company, organizations with better analytics capabilities are twice as likely to be among the top financial performers in their industry. They are also five times more likely to make decisions faster and three times more likely to execute decisions as planned, than their peers. Sadly, the research also revealed that only four per cent of oil and gas companies have the talent and skills they need to draw tangible business value from analytics.
Interestingly, some studies show a significant increase in Big Data and technology investments within the oil and gas sector. Although this increase in investment is a marked departure from current levels, it is important to note that they are far below the levels in other industries such as aviation, healthcare, telecoms and finance. In the current environment of price uncertainty within the oil and gas industry, companies are seeking ways to derive the most value from current assets and innovative ways to mature newer assets at a minimal cost.
With this desire to improve operational efficiencies, companies have to determine which key performance indicators they seek to address using data. Big Data and technology can help organizations make informed decisions faster and more efficiently because of an increased ability to analyze, model and visualize scenarios, even before they unfold. This helps to optimize maintenance, identify opportunities to maximize production and manage project costs. All these together help to drive innovation and improve operational efficiencies.
Technology Alone Is Not Enough
Most executives in the industry agree that successfully harnessing and implementing Big Data initiatives will unlock volumes and add business value by driving efficiency. However, this alone cannot bridge the efficiency gap. There are important factors that play a central role in achieving this promise:
- The business should ensure that technology deployments are targeted and fit for purpose. Even though technology is a key enabler to aid analysis and provide insights, it is important not to get sucked into the technology trap.
- Existing workflows and processes need to be constantly reviewed in order to prove that the application of these initiatives can provide high-value business solutions.
- The oil and gas industry should recognize data management as a discipline in its own right, rather than continue to see it as a function of IT. Competency frameworks and career development roadmaps for educating and recruiting new and current practitioners should be developed to encourage professionalism and accountability.
- Ultimately, the business must identify its critical data and aim to get the right quality out to the right people at the right time. The biggest obstacle to using real time data is often the quality of the data. Companies should invest in better ways to manage their data for optimum performance.
Low oil prices, rising cost profiles and market volatility have created uncertainty in the industry. Integration, standardization and collaboration, driven by a visionary and strong corporate leadership, will be the differentiator between well prepared companies and those playing catch-up.
