In the past few decades, the Middle East region has experienced rapid growth in terms of both its population and its demand for energy to fuel its own – as well as a global – future.
This growing need must be met by a combination of existing resources in the oil and gas sector and burgeoning renewable energy technologies.
To fully realise the energy transition, both the oil and gas and the renewables industries must be supported by digitalisation to drive the efficiencies required to manage assets more responsibly and profitably.
In the complex world of energy asset operations, owners and operators often face a data management challenge in which underutilised information leads to action deficits – a phenomenon whereby organisations are not utilising the data and insights available in their shared ecosystems, thus putting their assets, and the wider sector, at risk.
How are energy firms meant to keep pace with the transition into renewables if they are trapped in stagnated data?
The cost of data gaps
Every day, on almost every site in the Middle East, staggering amounts of data are collected for maintenance, integrity, turnarounds, engineering services and a host of other activities. But where does all that data end up? How much captured data is lost or unused, and what is the cost of that lost opportunity?
At James Fisher Asset Information Services (AIS), our research suggests that much of the collected data ends up nowhere.
We say “nowhere” because, if there is no attempt to organise the data into information, nor to use that information to drive an insights-driven decision-making chain, that data might as well not have been collected.
In 2017, the Wall Street Journal’s Industry Week calculated that more than $50bn a year is lost in the manufacturing
sector due to the use of reactive rather than proactive models and the cascading knock-on effects that result.
A real-world example of the consequences of data going nowhere is the standard and ubiquitous run-to-failure model (RTF) that exists even in newer renewable energy endeavours, such as offshore wind farms.
Anywhere this model is found, it is a sure indicator of a lack of data-driven operations, overall data immaturity and an organisation on a constant emergency footing – an organisation that allows the asset to make its decisions for it rather than intervening when it is optimal for the organisation.
In contrast, one example of the use of James Fisher AIS’s digital twin software on a project in the Gulf of Mexico delivered significant cost reductions by getting ahead of the planning phase for turbine replacement and turnaround. The implementation resulted in a saving for the client of about 10 per cent, or $10m.
Digital twin software odelivered significant cost reductions by getting ahead of the planning phase for turbine replacement and turnaround
Across the company’s client base, the digital twin software has delivered about $120m in cost reductions.
Addressing the action deficit
The action deficit is the sum of the things that act as barriers between the decision to act and the execution of the action itself.
When it comes to data management and utilisation, the action deficit can range from legitimate organisational barriers to simple wilful inaction.
Having a transparent data management philosophy in place benefits every level of an organisation, from executives to contract workers. All parties can become stakeholders in data collection, analysis and decision activities, and all can explain why data is important to the endeavour on a day-to-day basis.
Having a transparent data management philosophy in place benefits every level of an organisation
In addition, a clear data management philosophy demonstrates that a company is willing and able to invest in the tools, processes and training that are needed to culturally transform it into a data-driven organisation.
Such companies are able to bring all their in-house and contracted teams along the data-integration journey and reduce the action deficit for all involved.
| Learn more about subscribing to MEED.com|
The #1 platform for business news and intelligence trusted by 1,000+ leading, global brands
Creating competitive advantage
Good data management – backed by a clear philosophy that is communicated to all stakeholders – can only produce positive results in driving the efficiencies needed to engage the energy transition.
For the Middle East’s national oil companies, their performance in both the traditional and renewable energy sectors reflects directly on their nation’s government.
Businesses, local workers and communities would benefit from better returns on investments (ROIs), improved safety, decreased unplanned outages and fewer shutdowns, all as a result of increased data maturity, a reduced action deficit and improved decision transparency.
With major onshore and offshore projects even modest savings and carbon reductions through data-driven efforts could make a difference
With major onshore and offshore projects such as the $20bn Ruwais refinery project in Abu Dhabi, or the $15bn Marjan field expansion scheme in Saudi Arabia, even modest savings and carbon reductions through data-driven efforts could make a difference in the industry.
Ultimately, this will aid in attracting to the Middle East region investors who understand that how a company performs in its traditional energy industries will be a direct reflection of how it is likely to perform in its energy transition, as putting data best practices in place now will help to futureproof the Middle East’s energy transition tomorrow.
You might also like...
A MEED Subscription...
Subscribe or upgrade your current MEED.com package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.