Culture change key to digital’s success in the oil and gas industry

Digital is hot. It’s not new though, so what has changed that everybody is talking about it now?

A panel convened during CERAWeek by IHS Markit comprising speakers from BP, ADNOC, Siemens and Accenture discussed developments in digitalization, its proven and potential gains and ultimately: how culture change within companies is needed for realizing digital’s full potential.

“First, digitalization was about harnessing data,” said Ahmed Hashmi, Global Head of Upstream Technology, BP. “Then it was about how to get analytics around it.”

“Next, we discovered that the technology was not up to date with the amounts of data and we could not deploy it.” “Now”, Hashmi said, “with the possibilities of artificial intelligence and automation, we can.”

Cultural shift needed

There is a range of challenges associated with digitalization, but today, technology is not among them anymore. The real challenge, all agreed, is for work processes and culture to catch up with technological possibilities. “How you get people to interact with the automation is the biggest challenge,” said Hashmi. “You have to consider this very carefully before you implement digital solutions and not do this on the fly.”

“Turning data into value, is the challenge that we are working on,” said Lisa Davis, CEO Global Energy & Member of the Managing Board of Siemens AG.

“At Siemens we have the advantage of working in different industries, which gives us great opportunity to leverage our experiences in one industry and see what we can use in another…Lessons from health care imaging for example have been useful for the oil and gas industry.”

“Siemens has been pioneering digital solutions for quite some time”, Davis said, “but what’s different now is the receptiveness of people and companies to look for digital solutions.”

To reduce costs – especially in today’s market situation – but also more generally because of a drive for optimization.

“What’s also different, is that the ability to capture data is going on everywhere,” Vivek Chidambaram, Managing Director, Global Digital Lead, Accenture Strategy Energy added.

At BP, digital solutions have led to clear optimization according to Hashmi: “At BP, we have a target to keep decline at 3-5%. The last years, this has been limited to 2.5%, thanks to digital technology.”

Digital oilfield

Qasem Al Kayoumi, Manager, ADNOC Technical Centre told the audience how the concept of digital oilfield is generally accepted and “seen as an enabler for operational excellence within ADNOC.” Also, ADNOC, together with drilling contractors, is looking at the potential of automated rigs.

On collaboration with partners, the panel was clearly convinced of the benefits. The level of collaboration, or lack thereof, is also what clearly sets the oil and gas industry apart from other industries.

“If you look at the ‘digital maturity’ of industries, the automotive industry is an incredible example of how well automation can work and what it can bring”, said Chidambaram. “The culture of sharing processes and collaborating that we see in automotive and aviation should become more customary in oil and gas.”

Davis and Hashmi both cite their companies’ experience with supply chain collaboration. “There is a lot of know-how in the supply chain,” Hashmi said. Siemens collaborates both with their suppliers and with their clients, depending on the objective.

The panel is not convinced that digitalization is going to lead to a reduced workforce.

Davis: “I think we will not need less people, but we will see a need for a different skillset.”

Article by Femke Perlot-Hoogeveen