Digitalization helps companies thrive in ‘new normal’ of low oil pricesABB shows how digitalization can transform oil, gas and chemical operations, bringing greater profitability in tough times.
ABB today releases a white paper detailing how existing market dynamics and challenges are forcing a massive change in the oil, gas and chemical (OGC) industries’ approach to technology. Quoting from a range of independent sources, ABB believes that the current downturn is a forewarning of a new status quo to which industry players must adapt.
“Despite heavy cost-cutting by way of rig shutdowns and headcount reductions, operational savings have only clawed back a modest amount of losses triggered by the oil price crash,” says Per-Erik Holsten, managing director, oil, gas and chemicals business unit, ABB. “Reports we’ve seen suggest that only 23% of revenue losses have been offset by cuts in OPEX .”
ABB identifies four key tenets which OGC executives are encouraged to embrace in order to optimize performance and ensure long-term viability:
- Deploying enterprise-wide digitalization and connectivity
- Bringing together information and operational technologies
- Pursuing simplification and standardization wherever feasible
- Having CEO leadership and sponsorship of a digitally-focused approach.
“Network-connected assets can significantly reduce costs, shorten schedules and minimize risk,” says Holsten. “Because we embrace all aspects of electrical, instrumentation, control and telecoms, we are the only major player able to help customers achieve a completely integrated and digital performance-enhancing solution. In fact, we’ve demonstrated time and again our ability to deliver 20 to 30 percent CAPEX and OPEX savings while simultaneously improving uptime and extending asset lifetimes by 20 years.”
Continues Holsten, “Our approach to digitalization works, and this white paper shares what works and how it works to a wider audience.”
The implications for each segment –upstream, midstream and downstream– and a roadmap for creating a fully digitalized hydrocarbon value chain is presented for both greenfield and brownfield situations. Case studies are also provided.