Thursday, October 31, 2013

Digital Oilfields: A Sea Change in the Upstream Oil and Gas Sector

A few years ago, remote-controlled oilfields may have sounded like a scene from a sci-fi movie. Today, digital oilfields make old-fashioned methods of taking a chance to strike oil and gas a thing of the past. As such, digital oilfields rely on IT, automation and communication to improve all aspects of operations of the upstream oil and gas sector, from production and drilling to completion and safety. For example, oil services firms, such as Schlumberger, are able to seamlessly link remote drilling operations to command centers of its customers. Real-time monitoring of onshore and offshore drilling is available to geologists and engineers in the company’s multiple operation locations in different countries. According to John Brantley of IBM, incorporation of intelligence and automation into energy operations allows the companies to detect and preempt equipment malfunctions, automatically make changes, and reduce the risk of equipment failure. The petroleum industry can cut the costs of both onshore and offshore operations by 10% to 20% and increase the production of oil by an additional 125 billion barrels of oil, if the potential of digital oilfields is realized.  

Although the oil and gas industry still resists a shift to digitization, the market share of the digital oilfield technology is growing, particularly with the increased complexity of petroleum operations in geologically challenging environments and remote locations. While digital oilfields are currently most active in Western Europe and North America, the Middle East anticipates rapid growth in integrating remote monitoring and control of upstream oil and gas operations in the next ten years. According the oil and gas division of the New York-based International Quality and Productivity Center (IQPC), a web-based oil and gas information portal, “by 2015 the value of digital oilfield services is projected to exceed $200 billion, an increase of more than 405 from the 2012 market size.” At this juncture, there is no point of return to old, uneconomical and precarious methods of petroleum exploration and production.  

Current capabilities and best practices in digital oilfields, information and knowledge sharing, challenges of implementing IT platforms and solutions will be the fulcrum of IQPC's upcoming Digital Oilfields USA Summit in Houston, Texas, on December 10-11, 2013. It is a unique opportunity to learn from industry practitioners on how to capitalize on digital oilfield investments, how to leverage IT, and how reduce operating costs and maximize oil and gas production. Common challenges in implementing IT platforms and protecting information and operations from cyber threats will be also covered in the summit. Speakers at the summit represent market leaders in IT and the oil and gas sector.

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