Love it or hate it, the oil and gas industry still provides most of the fuel for industrial and consumer usage. Demand comes from end users who want cheap, clean fuel for heating and driving. Industry wants the same for its manufacturing and supply chains, but on a larger scale.
But how can the energy industry do it all? Especially in a low/flat price environment? Providing cheap oil and gas to customers compromises the profit margins of drillers, refiners and marketers, as does offering the most environmentally friendly qualities.
The answer lies in technology, using it for transforming oil and gas companies into efficient, transparent and sustainable entities. And that’s what we believe will happen in 2020.
Here are my top three predictions:
- Well-oiled Efficiency
The forecast for the next five-year trading range of a barrel of oil is between $50-$80. At this price range, the mandate for operational efficiency is key and its maniacal pursuit will be the primary focus.
The efficient oil company will run like a well-oiled machine:
At home: Operational efficiencies in enterprise support functions will be a key focus area for 2020. Most of the projects slated to deliver on these goals are concentrated in cloud migration efforts and process optimization across support functions.
And away: One of the most critical exercises facing the energy industry is digitalizing field processes. For a sustainable path of year-over-year efficiency gains, the adoption of digital twin and process optimization capabilities will be critical enablers.
- Crystal Clear Visibility
Traditionally, the energy industry is largely defined by siloed operating business units pursuing field practices that lack a coordinated approach across the enterprise. The resultant siloed data leads to performance and optimization gaps, lack of cross-team collaboration and the inability to leverage the right/best resource for specific field events. Digital technologies can flip this script.
- Barrelling into Sustainability
In a world of accelerating climate change, the management of a sustainable operating plan has never been more important. Key to this operating plan will be the utilization of IoT and process optimization enablers to deliver on their compliance pathways.
These are my top three, but there are many more trends to investigate – from oil and gas companies taking a laser-like focus on the customer experience and analytics moving to the foreground, to increased automation and Board level interest in IT/OT efficiencies. I’ll be back with more soon.
Meanwhile, take a look below at how Software AG can help you manage these burgeoning trends in the future.