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Why we need Data Analytics in Oil and Gas Industry?

Why we need Data Analytics in Oil and Gas Industry?

Oil and gas industry is as big and humongous as it gets. It has virtually no boundaries and has interference in almost every sphere of life. All domains considered, technology has been at the core of the oil and gas sector; on the back of which this industry has thrived, evolving at a much faster pace. With that being said, data comes complementary with technology. Data from equipment, data from valves, data from wells and data from where not, has flooded the industry. Apparently, all of the organizations operating in the oil and gas framework are now keeping a separate workforce of individuals, involved in data analysis. Their skills of accurately analysing large data sets help derive potential benefits to the company. In fact, an article published by McKinsey & Co says that on an average, offshore platforms are operating at only 77% of maximum production potential. Rigorous use of data analytics in oil and gas industry can improve this figure substantially.

However, more than often, people tend to underestimate data analytics as a skill to have, and give more weightage to other skills, be it in an interview, in industry or in life altogether!

In the subsequent sections, let’s probe into how the use of data analytics in the oil and gas industry can prove to be a blessing in disguise!

Data Speaks Volumes!
Data Speaks Volumes!

Skill and its requirement

The one understanding that we can establish from the above written arguments is that the data analysts are in high demand across all the domains of the oil and gas industry; be it upstream, midstream or downstream, and will remain to be so, for a very long time. The next question we need to face is what specifically those jobs are that require data analysis skills!

To begin with, data comes from numerous sources in different segments. If we are looking towards the upstream sector, data comes from seismic tests, sensors installed in wells, and on drilling equipment and so on. For the midstream segment, data is derived mostly from the SCADA or Supervisory Control and Data Acquisition system. As far as the downstream sector is concerned, the volume of data collected is immense, being collected from distillation columns and another important set of equipment. So, if we are looking at jobs that would require data analysis skills, the number is huge.

Impact of Data Analytics

The article published by SPE International went into detail explaining how US-based oil major, ConocoPhillips solved the big data problem that stood in its way of achieving maximum productivity. Conoco recently connected the whole company divisions with integrated data warehouses (IDWs) that act as centralized data stores for personnel coming from almost all disciplines including geoscience, well construction, operations, production engineering, and others. After the data stores went into operation, improved well up-time, decreased drilling durations, optimized completion designs, and increased comprehension of subsurface characteristics started to appear in results.

In a similar instance, BP, reportedly, saved around $7 billion by deploying big data into its operations. A Financial Times news article quoted Ahmed Hashmi, the Head of Technology for BP’s exploration and production business stating “More than 99 per cent of oil and gas wells operated by BP around the world are equipped with sensors that produce a constant flood of real-time data on production performance as well as the condition of infrastructure. This information is fed into a cloud-based storage system which allows BP engineers anywhere in the world to access the information.”

These might be small examples, but they go onto reflect how the implementation of data analytics can substantially impact the outcomes of processes involved in the oil and gas sector.

What Lies Ahead

The oil and gas industry has a chance to benefit from solutions through data analytics. In the wake of data analytics potential, many jobs will be created for people with sharp data analytics skill. This will lead to the formation of a gateway for new applications and ideas to enter the industry. Through new software and technologies, the oil and gas industry is all set to deploy big data analytics and see the bigger picture. Apart from the implementation of data analytics in the industry, proper attention must be given to the acquisition of the right minds in the industry that can put into motion the ideas speculated for analysis of data.

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