Operational Visibility, the Secret Sauce for Oil & Gas Companies
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The pace of technological change is a blessing and a curse. While, in many ways, businesses can capitalize on newfound efficiencies, the blurred lines between physical and digital, and the complexities of integrating new solutions and adopting new processes, are causing a ton of disruption; at least, for now.
For oil and gas companies, the ever-increasing cost of exploration, volatility in commodity pricing, and ongoing push to mitigate safety and environmental risks are leading to a major influx of new information and variables. This callis for new solutions that assure better safety, reliability and resiliency of operations. Plus, as the convergence of information technology (IT) and operational technology (OT) takes shape, we're seeing that more sensors, assets, machines and systems are being connected to the network than ever before and the data collected aren't being properly funneled or utilized.
Like the industry has seen since back in the Standard Oil days, this is another area in which oil and gas companies need to consolidate to scale – utilizing innovations like IoT, AI and automation – to reach digital transformation goals. This all starts with being able to see the actual operational status, be it offshore, pipelines or refineries, and other plant facilities. In other words, visibility is the foundation of the digital journey.
The first oil wells and refineries appeared in the mid-1800s. And while oil and gas companies aren't using wooden pipes any longer, they are still using legacy infrastructure that simply isn't able to produce the data needed in today's digital economy.
When it comes to operational visibility, there is no longer a need for a 'body' to be present for all shifts and operations to provide insights into equipment function and condition. But still, much of the infrastructure that extracts, transports and transforms petroleum-based products is decades old, built largely with no digital capabilities at all. This means much of the industry is still unable to measure how systems are functioning, identify root cause issues proactively and predict failure to avoid catastrophic incidents.
As oil and gas companies move away from manual, analog and physical operations to a more data-centric approach, the legacy infrastructure stands as a major obstacle, as does reluctance of workers who don't have the luxury of taking risks or losing time. But there's a way above it, with operational visibility being the key driver.
At face value, operational visibility may seem like a vague concept. Of course, providing greater visibility would be helpful to anyone, anywhere. But when it comes to oil and gas operations, it means systematically capturing the performance data for major systems used in industrial processes, and providing that data to the right people at the right time in the right medium. This, in turn, will enable more proactive management and increased efficiencies overall.
We can narrow this concept down to three critical capabilities:
To a singular company, this trifecta of visibility means improvements to operational efficiency, health, safety and environment (HSE), and risk management. People's lives and economic situations, along with entire environmental ecosystems, are at stake. At a macro-level, the price of the products created from this industry are foundational to the broader economy. The price of oil fuel products such as gasoline, diesel and AVfuels, as well as feedstocks for plastics, can spark inflation, hurt economies, stem travel and so much more. Driving efficiency and security into this industry is a boon for the whole world.
It goes without saying that implementing operational visibility isn't an easy task for oil and gas companies. These are massive environments we are dealing with – operating on legacy equipment – spread over multiple geographies.
One of the biggest hurdles preventing effective operational visibility is geography. The assets needing visibility are not located where people live, which is where networks that can support digitization exist. In other words, service carriers do not provide services in the barren areas where oil and gas operations take place.
Because pipelines tend to reside in dead spots, a foundational network must be established. Next steps are to add sensors and a pathway for information on the edge of the new network. It doesn't stop there. The data generated needs to be stored, integrated, computed, analyzed and turned into actionable insights.
But operational challenges aren't limited to simply placing sensors and building dashboards. People and processes must be aligned, as well. Rightfully so, folks can be culturally averse to change and frustrated by fruitless hype cycles. They are protective of internal processes and functions, of which integrity must be preserved, so there is little capacity for compromise.
This sure seems like a lot to contend with. But alas, just as operational visibility is the way towards digital transformation, there's also a way towards operational visibility.
WWT's fundamental resolve to attain operational visibility is analogous to the human nervous system, drawing on its three components: receptors (sensors), nerves (networks) and cognition (information architecture, analysis and applications). This is the foundation of how we map and execute an operational visibility strategy, custom to each client's specific requirements.
While this is definitely a move towards technology modernization, operational visibility will also require a cultural shift, which accounts for and impacts people and processes.
Currently, alarm fatigue and the overwhelming amount of data plagues operators. It's important to provide them with transparent, actionable data flows and analytics, whether on or off site. The user experience is the soul of any operation, and making sure operators are given the right data at the right time can make all the difference.
It's also important to figure out how to collect and use data on fixed assets to optimize processes and generate revenue. Integrating visibility across operations to inform decision-making with real time information reduces the need for the rounds and resources required to predictively and proactively address maintenance issues before they become real problems.
Most important of all, is human safety. Attaining operational visibility the manual way has been and will forever be a risky endeavor. Take remote ocean rigs, for example; where there is no help for miles, a tiny accident can become catastrophic. What about unknown toxicity levels in a chemical plant? Unseen to the naked eye, noxious gas can be life threatening, but sensors that monitor network assets and unplanned outages can also monitor leaks and measure exposure levels to alert people on the floor, potentially saving the lives of people on the ground.
This must all be taken into account when surveying an operational visibility strategy.
Operational visibility fosters data-driven decision-making on factors such as production scheduling, resource allocation, capacity planning, lending to improved market analysis, pricing strategies and investment decisions on the business end.
The improved efficiencies, reduced downtime and optimized resource utilization all contribute to cost reduction, putting oil and gas companies in better position to cut operating costs and increase profitability.
So, as it seems, the benefits of operational visibility are many. But in order to really make the most of this investment, a wise first step for business leaders is to prioritize areas that solve problems, drive change and appeal to the end users. Here are some key use cases to consider:
Predictive analytics and maintenance: By analyzing data from sensors and equipment, companies can employ predictive analytics to anticipate potential issues and optimize their operations, and can anticipate when equipment is likely to fail and schedule maintenance before costly breakdowns occur.
Improved asset management: Oil and gas companies have a vast array of assets and systems including refineries, gas processing plants, pipelines and drilling, and production assets. Operational visibility provides insights into the condition and performance of these assets; it enables teams to schedule maintenance and repairs proactively, extending the lifespan of assets and reducing downtime.
Enhanced customer service: Operational visibility allows teams to respond more effectively to customer inquiries and complaints. When teams can quickly identify the source of a problem and provide accurate information on when it will be resolved, internal and external customer satisfaction increases.
Energy efficiency: Operational visibility can help in monitoring and operational efficiencies within all segments of oil and gas as well as assisting in meeting ESG goals and compliance. This leads to improved energy efficiency, reduced waste and cost savings.
Compliance and reporting: Oil and gas companies are subject to various regulations and industry-specific standards related to safety, environmental impact and service quality. Operational visibility helps ensure compliance by providing the data and insights needed for reporting and audits.
Disaster preparedness: Oil and gas companies need to be prepared for natural disasters, such as hurricanes, earthquakes and extreme weather events. Operational visibility helps to assess the potential impact of such events on their infrastructure and plan accordingly, including deploying resources for disaster response and recovery.
Safety and security: Monitoring the security of critical infrastructure is essential to protect against physical and cyber threats. Operational visibility enables teams to detect anomalies and security breaches, allowing for swift response and mitigation.
Sustainability and environmental impact: Oil and gas companies are under increasing pressure to reduce their environmental footprint. Operational visibility can help track environmental impact and implement strategies to reduce it, such as minimizing leaks or decreasing emission.
The top concerns are efficiency, safety and security, with the objective of establishing better practices for improving competitiveness in commodity markets and delivering better products at a lower cost with higher customer satisfaction. Operational visibility is essential for oil and gas companies to ensure the reliable, efficient and safe delivery of services while meeting regulatory requirements and reducing costs. It empowers teams to make data-driven decisions, respond to issues in real time and plan for the long-term sustainability of their operations.
Even with ready solutions on the horizon, there are some complexities to hurdle over. Before a solution can go into production, pre-production is necessary to vet and test architecture viability, which is challenging with so many stakeholders needing to get on board: network, end point, cyber, business suite, etc.
Within WWT's Advanced Technology Center (ATC) is an Industry Solution Center (WISC) that focuses on industrial technology solutions, so we can demonstrate how various control systems would work, how they can be monitored to provide visibility and how it can all be secured. We can show your teams how end points will work with different types of networks on a production site, and how full systems hold up against, or fail, when faced with a range of cyber attacks. Here, we also perform proof of concepts to show whether and how solutions work, which builds confidence in your decisions, because there's not room nor time to do it all over.
As paramount as operational visibility is, it's only the tip of the iceberg. Right now, you can't automate what you can't see, so the ability to establish these sensors and monitoring systems will enable an entire new level of digitization, connecting all workers with clear, accessible and insightful data.
This is the first step towards driving AI-powered automation. The visibility of the machines, the inventory, and the workers allow for automation to unfold, and the result is delivering cheaper, better-made products, produced by safer systems.