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It is no exaggeration that the energy sector is facing massive upheaval and challenges. The oil and gas industry needs to grapple with social and economic pressures to both maintain their competitive position and additionally be seen as good global citizens.
The three main challenges that the resources sector faces include:
Reducing costs to remain competitive – resources extraction and production continues to become more expensive, as environmental, regulatory, and operational costs escalate. Optimizing production systems and site management is a renewed priority for these businesses.
Improving performance to promote the valorization of assets – resources companies need to develop ways to extend the life of mature sites and seek new sources for extraction in an efficient and cost-effective way.
Improving the environmental footprint – social pressure demands that resources companies become leaders in sustainability and renewable energy investment. What’s more, resources companies are major consumers of water and energy resources themselves and need to be seen as doing the right thing to be good corporate citizens in the application of those resources.
As noted in a McKinsey report on the state of the oil and gas industry, “This is a moment for oil and gas companies to make thoughtful choices, both to improve their economic and reputational resilience and to consider whether and how to reposition themselves to take advantage of the accelerating low-carbon winds of change.”
For resources companies, the answer to these challenges is in technology and transformation.
“Oil and gas companies need to leverage ICT technologies and management processes to increase reserves and production, and reduce operating costs while improving security,” said Robin Lu, Executive Vice President, Global Energy Business Unit, Huawei EBG. “Huawei believes that the technologies that have the greatest impact in the oil and gas industry will be AI and big data. Huawei has started to carry out practical cooperation and research with key oil and gas companies and has achieved preliminary results. We are confident that in the future, more AI and big data technologies will be integrated into edge hardware, application software, and cloud to support intelligent operations in all oil and gas scenarios.”
The three steps to sustainable resources
As Huawei’s Executive Vice President, Global Energy Business Unit noted, the data challenge that organizations face needs to be approached in a three-stage process. “Due to the complexity of service scenarios, the oil and gas industry needs to implement intelligence by cloud, edge, and devices in a hierarchical and layered way,” Lu said.
“First, we need to build digital twins for business scenarios to achieve comprehensive digitalization. Second, data needs to be aggregated and consolidated to achieve hierarchical intelligence. Finally, we need to eliminate system and data silos and build basic industry application capabilities based on digital platforms in order to support rapid service reconstruction and achieve comprehensive intelligence. For example, in the exploration and production field, Huawei and partners have built cognitive computing AI platforms for Chinese oil and gas companies and applied AI and big data analytics to improve oil and gas reserves and production, seismic data processing, oil and gas reservoir identification, and diagnosis of pumping well conditions. This way, we can release more value from data that was once ‘silent and useless.’”
An example of this in action can be seen in Daqing Oilfield, China’s largest oilfield. After 60 years of operation, the business was facing enormous challenges in terms of reserve replacement, stable production pressure, and the need to reduce costs and find new efficiencies.
To help it address these challenges, Huawei built a dedicated oil and gas exploration cloud. The cloud data center improves computing power by eight times and has similarly improved pre-stack seismic data processing capability by five times, from 400 square km to 2,000 square km, matching work area requirements. Elsewhere, AI and big data capabilities have been used to re-analyze 10 PB of Daqing Oilfield’s historical exploration data, to mine new value from it and support extraction decision-making, bringing huge additional value to the oilfield (read more about this case study here).
Sustainable development must meet current development needs as well as being future-oriented. Huawei works with global ecosystem partners to continue to explore digital transformation in the energy field. At the Huawei Global Oil & Gas Summit held during ADIPEC 2021 from November 14 to 18, we released Huawei’s smart oil and gas field safe production solution. The solution includes campus, vehicle inspection, safety and environmental protection, production inspection, and predictive maintenance modules, providing multi-scenario intelligent applications for oil and gas operations.
Huawei focuses on all scenarios in the oil and gas industry and provides mature scenario-based solutions such as exploration and development cloud, oil and gas field IoT, optical fiber vibration pipeline monitoring, and gas station interconnection for oil exploration, development and production, pipeline asset management, and refining and chemicals sales in the oil and gas industry, accelerating the industry’s digital transformation. (To read more about this summit, click here.)
In addition, as Lu said, Huawei is actively assisting its customers towards carbon neutrality.
“For example, Huawei is developing the zero-carbon smart campus solution,” Lu said. “It is also incubating capabilities and solutions for energy efficiency management, multi-energy complementation, and carbon management while ensuring secure and efficient operations of campus networks. The solution can be widely applied in oil and gas fields, refineries, and campuses in the future. In short, Huawei uses digital technologies to support all aspects of energy supply and consumption, enabling the energy transformation, digital transformation, and net-zero transformation of the energy industry.”
What impacts on oil and gas companies has a flow-on effect to the entire economy. It is important, both for the development of a carbon-neutral society and continuing to improve the quality of life of people, that oil and gas companies find ways to leverage technology to drive better efficiencies and greater sustainability.
For more information on Huawei’s solutions for the oil & gas industry, click here.