Tap data and digital technologies to adapt to new realities in oil and gas

Improve operational efficiency with IoT

History shows that the price of oil can spin into volatility mode with little warning, yet it appears cheaper oil prices are here to stay. Against a backdrop of the current “lower for longer” era, energy companies must prioritize operational efficiency to stay afloat. Despite the huge amounts of data that the oil and gas industry produces daily, many processes are simply outdated. Digital transformation of facilities and modern, new technologies for environmental and human monitoring, logistics, and more can turn data into insights. And if tapped effectively, the Internet of Things (IoT) can provide a competitive edge.

Revolutionizing petroleum using data

The task of spotting patterns in data gathered from millions of sensors, and then making actionable sense of it, is a daunting one. It’s estimated that oilfield sensors generate petabytes of production data, though oil and gas companies typically use as little as 1 percent of the data generated. With the potential to connect everything with everything, the IoT makes it possible to monitor and manage objects in the physical world digitally.

IoT integrates sensing, decision-making, and execution capabilities. From enabling self-managing machines in a production environment, tracking ships at sea, and wearable devices that monitor crew health in challenging environments, sensors combined with advanced analytics offer unparalleled depth of digital insights and fact-based action. In terms of improved operational efficiency, enablement of new revenues, and managing risk, IoT has significant benefits.

IoT can be characterized by five major elements. Together, these components can accelerate digital transformation and reinvention:

Sensors for data generation. For every physical quantity, there’s likely a sensor measuring it, from pressure, corrosion or human heart rates, to geophones that convert ground movement into voltage, and Global Positioning System (GPS) devices that track location.

Networks for data transmission. Multiple channels are available, including cable, WIFI, xG networks, low-power wide area networks (LPWAN), and satellite. Location and data size often determines which channel or channels are best. Edge computing–data preprocessing and filtering before integration–is increasingly essential to keep network loads manageable.

Platforms for data integration. Typically, networks bring together data from many sensors spread across many locations. Platforms integrate all this data in a common structure and provide the basic capabilities to process it.

Advanced analytics for insight generation. Without an advanced digital boost, petabytes of data are just data. Data mining, machine learning, and cognitive computing can generate actionable data insights from structured and unstructured data.

Business integration for aligned operations. Insights integrated in business processes and operations can generate insights that result in fact-based actions.

We’ve assessed and positioned 12 selected use cases in terms of the estimated order-of-magnitude value if successfully rolled out on an industry-wide scale. For the oil and gas industry globally, these use cases represent a potential value realization of USD 78 billion annually.