Energy Companies Well Suited To Adapt to Industry 4.0
Industry 4.0, the latest industrial revolution, has hit the manufacturing sector, building upon the adoption of computers and automation into industrial processes and adding smart, autonomous systems powered by data and machine learning algorithms.
The oil and gas industry is well suited to take advantage of Industry 4.0, so long as it can understand the drivers of this change, the convergence of new hyperconnected technologies, and the effects it may have on the existing workforce. A group of industry executives sat down on the first day of this year’s International Petroleum Technology Conference (IPTC) in Dhahran, Saudi Arabia, to discuss how that might work.
Nabil Al-Nuaim, chief digital officer at Saudi Aramco, said the industry was going through an “extreme revolution,” primarily in the connection between artificial intelligence (AI) and manufacturing. He called AI a game changer for the industry because of the possibilities it offers for companies such as Aramco, with massive amounts of data it needs to process. The question, he said, is whether companies are ready to scale up to a level needed to properly incorporate AI platforms into their operations.
“How do you integrate all of this data into our platform? Which parts of the value chain will be most impacted in order for us to achieve our business objectives? You need the data and the AI to answer these questions,” Al-Nuaim said.
Al-Nuaim discussed Aramco’s work in this space during the panel. Last March, the company unveiled a 4IR Center at its premises in Dhahran that it said would play a pivotal role in uplifting the technical skills of its workforce. An AI Hub, focused on developing advanced analytics and machine learning solutions in hydrocarbon related applications, is at the heart of the center.
“We must improve the market,” Al-Nuaim said. “It’s all about value-driven digital transformation programs. It’s all about how much value you can derive by implementing these programs, and what are the hidden costs? Aramco has a big volume of data, so there is potential to commercialize some of the applications and the IP [intellectual property] that we have created for our own operations.”
Al-Nuaim said artificial intelligence gives industry a golden opportunity to leverage business units operating in different organizational siloes. Uma Sandiya, general manager of oil and gas at C3.ai, said the breakdown of those siloes—one of the biggest hurdles to full-scale implementation of digital platforms—starts at the executive level.
“The technology solutions exist today, but there is still the people aspect that has to be resolved. People still believe they own data sets, and that’s where the executive oversight of the transformation comes in. You can have the CEO come in and say that all data is strategically enterprised within our platform. That’s how you solve the siloed data problem,” Sandiya said.
Ronald Raffensperger, chief technology officer at Huawei Data Center Solutions, said that companies must transform digitally to meet rapidly changing customer needs. Like Al-Nuaim, Raffensperger said this transformation requires them to utilize artificial intelligence with cloud computing platforms and their data to make the production, distribution, and utilization of their products more efficient processes, to the point where those processes may be automated.
One key to making Industry 4.0 a reality, Raffensperger said, is taking advantage of the amount of data that companies are able to gather. Cloud platforms may play a significant role in this regard.
“A few years ago we were talking about disks on our PCs that maybe had 100 GB of storage, and now we have more than that by far inside of our phones. So, the amount of information that our industrial processes generate has grown in leaps and bounds. How can we flexibly apply our scarce resources in computing and analysis to take advantage of that? That’s really around the cloud. The cloud is about technologies that also automate. It’s about being able to have your computing, your storage capabilities, and your networks that are pools of resources being flexibly applied to whatever problem you’re trying to solve at the moment, and having something that can do that automatically,” he said.
The word “automation” might induce anxiety for some in industry, but Raffensberger said that it should be a net positive for workers.
“As we move from the automation into intelligence, what we hope will happen for the workers is that their jobs will stop being completely, repetitively mindless. I’m not going to spend 4 hours going to a remote site, writing down a bunch of numbers that I got off of a bunch of analog meters, and then getting back into the office to spend another 4 hours logging it. There’s not a lot of value in that as a person. The opportunity with AI is to really unlock the human potential, to allow people to have a much better feeling that they’re actually controlling things,” Raffensperger said.
Derek Mathieson, chief marketing and technology officer at Baker Hughes, said that, while the push to Industry 4.0 requires the buy-in from the workers who will be affected, it also dovetails with the crew change the industry has undergone in recent years. He said the demand for data scientists from university graduate and recruitment programs has gone from “almost nothing” to a fairly significant percentage. As a different type of worker enters the business, he said companies may have to “retool on the innovation side” and reconfigure how these people fit into the design and creation of their businesses.
“We need to rethink how we think about the creation of real value,” Mathieson said. “The whole nature of competition is starting to change. For the first time in as long as I can remember, as many of our customers are working with Microsoft and Amazon as they are with Baker Hughes and Schlumberger. We’re living through the industrial revolution today. We’re seeing some of the ordering in the supply chain. We’re seeing the arrangement of partnerships with a range of tech suppliers.
Also speaking at the panel were Omar Saleh, head of energy and manufacturing for the Middle East and Africa at Microsoft, and Arja Talakar, CFO of Siemens Oil and Gas.
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