The world of oil and gas in the Middle East, although very lucrative, still operates in a very traditional way. But that’s changing. The Abu Dhabi National Oil Company (ADNOC) is the state-owned oil company of the United Arab Emirates and holds the seventh-largest proven reserves of oil in the world at 97.8 billion barrels.
ADNOC is embracing digitalization and the Fourth Industrial Revolution in a big way. They are calling it Oil & Gas 4.0.
Abdul Nasser Al Mughairbi, Senior Vice President, Digital, ADNOC Group, tells the audience at the Atlantic Council Global Energy Forum in Abu Dhabi that the oil and gas industry must embrace digitalization:
We Have to Embrace Digitalization
ADNOC is a national oil and gas company that has been in business for more than 45 years. We have been a solid and reliable provider of oil in the market, of energy, of refined products, and of petrochemicals. We are also a company that fueled the growth of the UAE. We are so proud of our company that we thought maybe we need to go to the next step. We are looking forward in how we are going to develop ADNOC to meet the challenges of the new and future demands.
Global energy demand is growing and is fueled by a bigger middle class coming on the market with more consumers. To understand this and to become an oil company of the future we have to change. We have to embrace innovation. We have to embrace change. We have to embrace digitalization. We look at this as our way of fueling Future Industry 4.0, the future revolution. We call it Oil & Gas 4.0.
Digitalization Starts With Big Data
We see this as a methodology for us to be agile, to be flexible, and to impact and speed up the decision making process. In this day and age of information superhighways that are changing and social media everything gets impacted by everything. You hear people in the East impacted by people in the West. Where does an oil and gas company fit into this? Do we transform ourselves into just an energy company? Are we a product company?
Regardless of where we go and regardless of our smart growth strategy and how we want to be a reliable supplier, digitalization fits right in the center of this. Where does our digitalization start? Our digitalization starts with our big data. Everybody says it’s culture. Yes, but the foundation is big data.
The Foundation is Connectivity
The foundation is connectivity. We have 14 operating companies that are all connected. In reality, we are operating in one geographical location. On the ground we are connected through pipelines throughout our facilities. We share facilities and products. We supply and give to each other and we do a lot of work together. Yet, our decision making process was not compliant. It was silo-based because we are 14 operating companies. Upstream and downstream.
All of you know the difference in culture between upstream and downstream, between manufacturing and the cowboys of the upstream. They make so much money, and we need them definitely, but digitalization has always been a part of the downstream. Remember, we are the original IoT. We had sensors everywhere. We were operating the plants using sensors in a closed network. We were doing this for such a long time. Now, this has moved out.
Real-Time Data Screen Like the Star Trek Enterprise
What did we do in ADNOC? Based on our big data and our connectivity that was already there, a lot of subsurface activity in data, we collected all this in one location. We did this through a fiber optic network, through 4G wifi, and made this connection is a secure closed network. We brought all the data in real-time to ADNOC’s head office.
We put this screen (below) on one floor as a panorama. It was an exciting journey to build that place. It’s a 50-meter screen and beautiful. The place looks like the Enterprise on Star Trek and it will help ADNOC to go where no other company has gone before!
Oil & Gas 4.0
The way see it is data is there. We collaborate with people in the oil and gas industry but we are looking beyond that. The new technology of artificial intelligence, algorithm, and data analytics, are much more advanced in other industries such as social, marketing, sales, and everywhere else. Yet, we in oil and gas have always been very traditional. In the beginning of the 20th Century and beyond we were the innovators. We drilled where nobody could go. We led the Second and Third Industrial Revolutions. We were fueling it.
Now how do we fuel the Fourth Industrial Revolution, Oil & Gas 4.0? We do this by harnessing our big data and by putting together connectivity. But what’s more important I think is changing our culture. The culture that we have currently is still a very traditional culture. Our decision-making process takes a very long time. A company of the future needs to take decisions very fast. They have to be accurate. They have to de-risk their investment and understand how to de-risk it.
Oil & Gas Coping with Technology Moving at Warp Speed
Things are moving at light speed, at warp speed. We really have to cope with this. To do this we need the information readily available for our management, for our leadership, for our engineers. At the same time, we need to allow these decision processes to go fluidly into the business process. That means we have to reduce costs. We have to look up how we optimize. It’s not oil and gas at any cost. It’s oil and gas at a cost. The cost is very important in the future because that’s sustainability.
Digitalization will help reduce the environmental impact of our facility. At the initial stage, it’s measurement, monitoring, knowing what we are producing, knowing what we are wasting, and knowing how we impact our environment. How do we do it? We do it through measurement, through optimization, reducing our energy footprint, doing a lot more carbon capturing, and doing less with more. Digitalization helps with that.
Easy oil is over. Now we have to go with very difficult to extract oil and gas which are very unsafe. Some of our oil reservoirs have 25 percent H2S. It’s a very poisonous gas that can kill. How do we reduce the impact on the environment and the impact on the people? We do this by going into remote operations, by doing a lot more with robotics, drones, all the new technology that is used everywhere else. We need to start adapting it.