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Workshop in Kuwait Lifts the Bar in Digital Transformation for Oil and Gas

Cloud platforms, real-time monitoring, and gamification of workflows are not new to the oil and gas sector. A growing number of organizations are adopting digital transformation (DT), seeking innovative strategies, safer operations, and business optimization. In line with the exponentially increasing pace of technology advancement, pressures of change are mounting, and experience shows that not all transitions are successful or straightforward. DT for the upstream and downstream processes of oil and gas is available and ready to be implemented with step and disruptive changes dramatically uplifting the traditional way of conducting business, boosting efficiencies, and empowering cost optimization strategies.

To analyze the current status of DT strategies and the pace of its implementation in the oil sector with a special emphasis on the Middle East, SPE held an Applied Technology Workshop titled, “Transforming Oil and Gas Toward Digital Intelligence” in late April in Mangaf, Kuwait.

The workshop attracted 138 ­attendees, and was held under the patronage of Deputy CEO (Drilling and Technology) of Kuwait Oil Company (KOC), Nayef Al-Anezi, and chaired by Jamal Al‑Humoud, manager of research and technology of KOC and cochaired by Maria Angela Capello, executive advisor in the North Kuwait Directorate of KOC. The ATW also included the SPE course “Digital Oil Field Building Blocks.”

The state-of-the-art as derived from DT journeys highlighted how decades-long operating companies have a real opportunity to transform their operating workflows to become energy ­digital leaders. The organizing committee included representatives of Emerson, Accenture, GOFSCO, Schlumberger, Halliburton, Weatherford, Baker Hughes, Microsoft, IBM, Deloitte, Worley­Parsons, Huawei, KUFPEC, Kuwait University, and Australian College of Kuwait.  

Al-Anezi opened the event highlighting the importance of DT and technology adoption in aging reservoirs. Al‑Humoud shared the step changes with which KOC entered the DT era, which included three digital oil fields pilot projects, applying the most advanced technologies to remotely monitor and control oil fields at West Kuwait, North Kuwait, and South and East Kuwait (Burgan fields). “We need to step up to embrace DT, to expedite our success, to optimize our costs and to enable the excellence in our studies and operations workflows,” he said. “Kuwait is pioneering in many fronts of DT, benefitting the oil sector of the state of Kuwait.”

The workshop included an executive panel and four technical sessions: Disruptive Technologies, Creating Value Though Integration, Embracing the Digital Future with Right Enablers, and The Next Digital Era.

Digital Transformation Discussion

Bart Cornelissen, managing partner of Deloitte Middle East Energy, Resources and Industrials, opened the executive panel, stating, “The oil and gas industry needs to re-imagine how work is conducted across the entire value chain for a successful digital revolution to take place.”

Participants’ questions were centered on how to change the mindsets of teams and individuals to embrace change. There is apprehension in moving staff, especially technical staff, out of their comfort areas. No initiative of change will be successful if it is not accompanied by a change-management strategy. Reem Al-Shammari, KOC team leader of information security, stated that, “It is better to engage in new formats of working and be flexible to learn new workflows and systems than to be immersed in rigid structures of work and data that preclude optimization.”

On the same topic, Rizkallah ­Nicolas Ward, digital consulting manager Middle East and Africa for Schlumberger, stressed this point for DT journeys: “Beyond the savings and value creation promised to the E&P industry, it is important to realize that every company is unique in its transformation journey due to the unique points of departure, destination, and pace of change style.”

The workshop not only included the vision of operating and service companies but also the insights of consulting firms that have worked with both national and international oil companies. James Wimbury, Accenture Kuwait client account lead–resources industry, highlighted that, “Our industry is at a historic pivot point, Industry 4.0. We need to be at the very cutting edge of this change, with a vision beyond digital to organizations.”

Manooj Nimbalakar, Weatherford’s vice president of production automation and software, summarized the three main points for DT journeys to be:

1) Why we are doing this. Understand the technology benefits.
2) Embrace the technology and make it your own.
3) re we ready for the change? Attitude is the major hurdle to overcome.

Software and hardware companies played an important role in the ATW, with IBM, Microsoft, and Huawei as keynotes. Omar Saleh, regional director, manufacturing and resources, Middle East and Africa at Microsoft, said, “Organizations become infinitely more agile when devices, software, and communications technology form a contiguous ecosystem that allows seamless planning, reaction and optimization.”

The following is a summary of lessons learned from the workshop:

  • DT pilots in small areas of oil assets that are submitted to digital oil field transformation are an effective way to initiate change in large organizations. Additionally, they gain the buy-in of all stakeholders.
  • DT requires the endorsement and, most importantly, active involvement of the leadership in a top-down role modeling that activates acceptance from all the staff of what is the most significant change since the industrial revolution.
  • DT needs a new workforce profile to ensure the success of initiatives in oil and gas, one that is agile, flexible, and change-ready, constantly shaping its skills to suit the tasks at hand, and prepped for the unforeseen technology changes. That is going from a legacy business to a new business.  
  • Moving ahead in oil and gas means shifting from traditional organizations with a rigid structure and hierarchy toward new operations grounded in partnerships, domain experts, cross-functional teams, remote/digital monitoring, ad-hoc management teams, and an ever-incremental presence of data scientists in the analysis and decision processes, in expanding and changing ecosystems, which shape the trends.
  • The energy transition will push oil and gas companies to transition from a provider-centric to a customer-centric business model, helping shape future policies for their own survival in the energy market.
  • Data are an asset on its own, more valuable than facilities or other “tangible” assets. Massive data analytics, in particular, are a star asset for oil companies to drive profitability. Data-sharing is a step-change being applied by several majors in oil and gas that is producing breakthroughs when a wiki-approach powers the analysis. Equinor’s data sharing is an example.

Capello, the co-chair of the ATW, summed up the workshop: “This ATW ignited an open and vibrant discussion on the progress, challenges, and opportunities in journeys toward DT in oil and gas. Clearly, we are at the verge of a huge change. I embrace it! Will you?”

Workshop in Kuwait Lifts the Bar in Digital Transformation for Oil and Gas

Maria Angela Capello and Jamal Al-Humoud, Kuwait Oil Company

01 August 2019

Volume: 71 | Issue: 8

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