Why IoT is the next evolution in oil and gas
Business Insider recently published a report predicting a total of 22.5 billion IoT devices in 2021, (15.9 billion more than the reported 6.6 billion in 2016) and $4.8 trillion in aggregate IoT investments over the next five years. These projections might seem astronomical, but in all reality, they make perfect sense when you note the outstanding benefits these devices deliver to various industries.
To stay competitive in our current climate of lower oil prices, oil and gas companies are being forced to find smarter and more efficient ways to operate.. Exploration and development not only require connectivity, they demand better equipment monitoring and process automation. With the rise of IoT, oilfield companies can take advantage of three areas that will boost their bottom line and bring new life to the industry: more information, smarter equipment, and better field efficiency.
The massive data flow that comes from IoT solutions allows operators to not only self-diagnose but also self-control. The intrinsic value transfers from previously managing your assets to now gaining critical information from them. With real-time analytics, companies can directly drive process improvements and optimize production. With field-to-cloud connectivity, you have the data you need on demand. It is no longer sufficient to just know where your various tanks are; it is now critical for survival to be alerted when one might be close to running dry. In this article, the Houston Chronicle reports that increased data capture can save millions by eliminating as many as half of a company’s unplanned well outages and boosting overall crude output by as much as 10%.
If your asset is a mission-critical part of a job, the ability to talk to and remotely control the device is priceless. Smart sensors paired with two-way communication allows you to remotely turn a pump or generator off, shut a valve or set overflow or air quality alarms. This remote capability lets your equipment do the job with the reassurance that if something goes wrong – your equipment is programmed to act, directly minimizing the risk of hazardous accidents.
If time is money, efficiency is the oilfield’s strongest currency. By combining more data with the intelligence to act, vital processes get streamlined, and companies can do more with less. IoT allows for route optimization, higher utilization, and remote automation. Additionally, it can solve problems such as equipment hoarding and prevent production delays.
In an interview in 2000, former Saudi Arabian oil minister, Sheikh Ahmed Zaki Yamini, commented, “The Stone Age did not end for lack of stone, and the Oil Age will end long before the world runs out of oil.” The Sheikh’s words hit close to those who experienced the tumultuous climate of oil and gas these past few years. Although oil is slowly coming back to life and by no means going anywhere, the Sheikh’s words warn that to survive change, adaption is necessary. With the Internet of Things driving the next generation of oilfield technology, now is the time to plan for a better tomorrow.