Upstream Companies Expect Shorter Time to Produce Oil & Gas Due to Digital Technology Investments, Finds New Research from Ac...
October 25 2017 - 7:59AM
Business Wire
Almost two-thirds of upstream firms see the
value digital technologies deliver as low oil prices linger, and
the top risk of a lack of digital investment is becoming
uncompetitive
Faster and better decision-making and shorter time to first oil
and gas top the list of expected benefits that digital technologies
can drive for upstream oil and gas companies, a new survey from
Accenture (NYSE: ACN) and Microsoft Corp. (NASDAQ: MSFT) reports.
Respondents to the “Accenture and Microsoft 2017 Upstream Oil and
Gas Digital Trends Survey” also estimated the monetary value of
digital technologies and noted the next wave’s potential to further
transform their business, despite ongoing low oil prices.
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Asked to identify the top ways digital benefits their companies,
faster and better decision-making (30 percent) remained foremost,
as in the 2016 edition of the survey. Faster time to produce oil
and gas, however, jumped to second place from fifth last year (19
percent). Reduced risk enabled by real-time decision support was
the third most important (12 percent).
Now in its sixth edition, the global survey showed the upstream
areas most expected to benefit today from digital are production
(28 percent), geological and geophysical (27 percent), and drilling
and completion (19 percent).
Almost two-thirds (62 percent) of the more than 300
professionals surveyed perceive business value from digital
technologies, with 27 percent totalling it at $50 million to $100
million or more for their companies. However, 14 percent of
upstream respondents don’t know how much monetary value digital is
delivering, 20 percent don’t measure it, and 4 percent believe
digital is adding no value to their businesses today.
Most of the respondents expect their companies to realize value
from digital technologies and 73 percent said most of their oil and
gas fields will become fully automated using these technologies in
three to five years.
On the other hand, 39 percent of respondents said the greatest
risk from a lack of digital investment is becoming uncompetitive;
more than double the next group at 19 percent who cited the
inability to transition to a new energy landscape. Surprisingly,
despite the rise of connected devices on oilfields further exposing
upstream companies to cybersecurity risks, the fear of increased
cyberattacks came in at a distant third (18 percent).
“Upstream oil and gas companies are evolving from only using
digital technologies in siloes to using these digital technologies
and the related new ways of working to transform entire business
areas,” said Rich Holsman, who leads Digital in Accenture’s Energy
industry group. “Our survey respondents see big data and analytics,
cloud, the Internet of Things (IoT), mobility, high-performance
computing (HPC) and cybersecurity as having the greatest potential
to transform their businesses. In the next three to five years, 70
percent plan to spend more or significantly more on digital
technologies, and the next wave includes HPC, wearables, robotics,
artificial intelligence and blockchain.”
Digital technologies that upstream companies are investing in
today include mobile devices (56 percent), cloud (45 percent), big
data and analytics (43 percent) and IoT (42 percent). Priority
investment areas for these technologies are asset management and
maintenance, capital project management and production
optimization.
“It’s not always about petabytes of data. It’s about a set of
solutions and technologies that could not have been achieved even
five years ago,” said Egbert Schroeer, Worldwide Managing Director,
Process Manufacturing, Microsoft Corp. “Digital is doing more than
helping reduce operational costs through increased worker
productivity with mobility. The cloud, better asset management and
remote monitoring through analytics and artificial intelligence
(AI) are driving operational excellence and subsurface data
management for the oil and gas industry. However, it will be
essential for upstream companies to quickly develop in-house
capabilities and add external talent for data analytics and other
leading technologies, to stay ahead in the digital revolution.”
Upstream companies are also now adding digital workforce
challenges to their ongoing talent concerns. Recruitment is their
biggest challenge in this regard, especially skill-building for
contingent labor, freelancers and onboarding new hires. Most said
it will take three to five years to build the necessary digital
skill base. For example, the great majority of respondents (85
percent) felt their companies lacked fully mature analytics
capabilities. While they plan to develop that area, the expected
three-to-five-year time frame in which they aim to do that might be
too extended - competitively speaking - as technologies advance
rapidly. This is especially relevant, as an Accenture Strategy
study, The Talent Well Has Run Dry,
notes the oil and gas industry could experience a shortage of
10,000 to 40,000 petro-technical professionals by 2025.
About the survey
The Upstream Oil and Gas Digital Trends Survey, sponsored by
Accenture and Microsoft and conducted by PennEnergy Research in
partnership with the Oil & Gas Journal, surveyed over 300
upstream leaders across 18 countries. Respondents included
executive and mid-level management, business unit heads, engineers
and project managers from a cross section of National Oil
Companies, International Oil Companies and Independent Oil
Companies.
About Microsoft
Microsoft (Nasdaq “MSFT” @microsoft) is the leading platform and
productivity company for the mobile-first, cloud-first world, and
its mission is to empower every person and every organization on
the planet to achieve more.
About Accenture
Accenture is a leading global professional services company,
providing a broad range of services and solutions in strategy,
consulting, digital, technology and operations. Combining unmatched
experience and specialized skills across more than 40 industries
and all business functions – underpinned by the world’s largest
delivery network – Accenture works at the intersection of business
and technology to help clients improve their performance and create
sustainable value for their stakeholders. With approximately
425,000 people serving clients in more than 120 countries,
Accenture drives innovation to improve the way the world works and
lives. Visit us at www.accenture.com.
Accenture Digital, comprised of Accenture Analytics, Accenture
Interactive and Accenture Mobility, offers a comprehensive
portfolio of business and technology services across digital
marketing, mobility and analytics. Learn more about Accenture
Digital at www.accenture.com/digital.
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version on businesswire.com: http://www.businesswire.com/news/home/20171025005096/en/
AccentureGuy Cantwell,
+1-281-900-9089guy.cantwell@accenture.comorAccentureMatt Corser,
+44 755 784 9009matthew.corser@accenture.com
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