Transformational shifts will be required to adjust to the new “digital” normal; the standard approach to downturns is not sufficient – says EY report explaining why it is just right time to invest in digital oil.
New technological developments have consistently pushed oil and gas operators into new frontiers — deeper waters, more remote reservoirs, and unconventional plays — that were once out of reach.
While advances have spanned the value chain, horizontal drilling and hydraulic fracturing unlocking shale resources played a major role in creating the oversupply responsible for the market shift and resulting in low crude prices.
The shift to abundance from the peak oil concerns of the not-too-distant past and the slow demand growth has reset oil and gas prices to lower levels and created a mandate for oil and gas companies to focus aggressively on both capital and operational efficiency to reduce costs.
Transformational shifts will be required to adjust to this new normal; the standard approach to downturns is not sufficient. Dramatic changes in business models, workflows, talent and technology across the hydrocarbon value chain are necessary to improve response to market signals and maximize efficiency.
Digitalizing across an organization can break down silos and build bridges from the islands of excellence to allow digital innovation to permeate the whole organization.
Challenges still abound — how can companies justify the investment, given the constant influx of new digital applications and during a time when companies need to be extremely selective in their spending?
The fundamental driver is simple: leveraging the power of digital technology to transform business operations can deliver real, sustained value to the bottom line. Another reason that the time is right for digital in oil and gas is the robust nature of the latest technology. The consumer internet couldn’t handle the volume of data oil and gas needs for digital to be meaningful.
With the advent of the industrial internet, there is now the infrastructure to handle the vast amounts of data generated along with advanced analytics, cloud storage and increasingly reliable mobile communications. These recent technological advances enable digital technology to transform the oil and gas industry.
Digital solutions that support this new approach are how the oil and gas industry will transform to succeed both today and in the future.
Harnessing the value from the IIoT requires more than adding sensors to machines and assets
The fundamental driver is simple: leveraging the power of digital technology to transform business operations can deliver real, sustained value to the bottom line.
April 17, 2019
April 12, 2019