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Inventing Smarter Ways: Oil & Gas in the Energy Era

  • 4 min read
  • Insight

In a time of tremendous change for the oil and gas industry, the call to action at this year’s annual meeting of Baker Hughes, a GE company, was for industry leaders to be more efficient, productive and collaborative. And with economic indicators pointing to a stronger period ahead, the big question on everyone’s mind: How can industrial technology, investments and partnerships help the industry accelerate innovation?

Since the meeting last year, oil prices have jumped and the mood among the more than 1,400 executives who gathered for the BHGE event in Florence, Italy—a city known for its innovators—was notably upbeat. Their interest has shifted from surviving long-term low prices to focusing on the industry's role—and theirs—to looking and adapting for smarter and more sustainable and competitive ways to bring energy to the world.

Among speakers, the tone was urgent. "How do we innovate faster? How do we continue to change? How do we adapt?" asked Lorenzo Simonelli, Chairman and CEO of BHGE. "This industry has been plagued by being viewed as a pollutant, as dirty. We've got to confront that and radically change the view that people have."

Coming off this rallying call to action, there was much talk at the event, reflecting ongoing industrywide discussions, about renewable energy technologies, which have matured to the point that they will play an increasing role in future energy production.

However, the more immediate priority is efficiency. For big companies, moving faster to harness digital technologies from robotics to analytics to cut costs, boost productivity and enhance performance is key. A big takeaway: with better and faster decision-making, streamlined business processes, and more efficient production and delivery, large companies can become as nimble as smaller ones.

Moving forward, how can the industry best evolve to address the macro trends and mega challenges and opportunities? By working together to deliver more sustainable products with better economics and a reduced total cost of ownership. Among the specific solutions discussed:

  • Leveraging technology to reduce the cost of business.  This includes developing and adopting market-leading hardware and software that could cut costs by up to 50 percent by integrating solutions across exploration, development, drilling and production. As an example, timing required for drilling wells was halved during the downturn, while accuracy increased. The use of improved drilling materials and bit designs, and more accurate, real-time control systems were among the factors responsible for the improvement.

  • Supply chain integration to improve productivity. Look to "fullstream" (upstream + midstream + downstream) operations to develop new commercial models and enhance organizational and process designs. The end result: higher-quality products and services—and more of them.

  • Using digitization to increase industrial yield. Digital Twins, artificial intelligence, optimization algorithms and enterprise resource planning (ERP) transformations enable new ways of developing fields and reducing development cycles—from years to months to weeks.

GE Ventures is doing its part by investing in startup companies and creating new businesses like Avitas Systems. Avitas Systems is the first inspection solution offering enhanced robotic autonomous inspection, advanced predictive analytics, digital inspection data warehousing and intelligent inspection planning recommendations in a Web-based, always-on interface. Depending on the application, the Avitas Systems solution has been shown to be up to 10 times faster, 25 percent cheaper, and safer and more accurate in the field with IOCs, NOCs and O&G Independents.

Another GE Ventures portfolio company helping companies improve their results is Maana, whose software platform analyzes vast amounts of data from divergent sources, or "data silos,” to identify relationships within the data so that companies can optimize their processes. Maana helps companies use their knowledge better and faster to reduce costs and increase performance.

The focus will remain on productivity, cost-effectiveness and environmental responsibility as the industry recovers. And as the BHGE meeting in late January confirmed, we remain committed to inventing smarter ways to provide fuel for the world in the years ahead.