Data is driving the energy transition
In the last few decades, the Middle East has experienced rapid growth in both population and demand for energy to fuel its own, as well as a global, future. This need must be met by a combination of existing resources in the oil and gas sector and burgeoning renewable energy technologies. To fully realise the energy transition, both the oil and gas and the renewables industries must be supported by digitalisation to drive the efficiencies required to manage assets more responsibly and profitably.
In the complex world of energy asset operations, owners and operators often face a data management challenge in which underutilised information leads to ‘action deficits’—a phenomenon whereby organisations aren’t utilising the data and insights available in their shared ecosystems, thus putting their assets, and the wider sector, at risk.
How are energy firms meant to keep pace with the transition into renewables if they are trapped in stagnated data?
The cost of data gaps
Every day on almost every site in the Middle East, staggering amounts of data are collected for maintenance, integrity, turnarounds, engineering services, and a host of other activities. Where does that data end up? How much captured data is lost or unused, and what is the cost of that lost opportunity? Our research suggests that much of the collected data ends up nowhere.
We suggest ‘nowhere’ because, if there is no attempt to organize the data into information, nor to use that information to drive an insights-driven decision-making chain, that data might as well not have been collected.
A real-world example of the consequences of ‘nowhere’ data is the standard and ubiquitous run-to-failure model (RTF) that still exists even in newer energy endeavours, such as offshore wind. In 2017, WSJ’s Industry Week had calculated that more than $50 billion per year is lost in manufacturing due to the use of this reactive model and the cascading knock-on effects that result. Anywhere this model is found, it is a sure indicator of lack of data-driven operations, overall data immaturity, and an organization on a constant emergency footing—an organization that allows the asset to make its decisions for it rather than intervening when it is optimal for the organization.
"One example of using James Fisher AIS’ digital twin software to get ahead of the planning phase for a turnaround saved the client 10% — equating to over $10 million – for a single project in the Gulf of Mexico and has resulted in $120 million in cost reductions across all our clients since it came on the market."
Sean Huff, James Fisher AIS, 12 May 2022
Addressing the action deficit
‘The action deficit’ is the sum of the things that act as barriers between the decision to act and the execution of the action itself. When it comes to data management and utilisation, the action deficit can range from legitimate organisational barriers to wilful inaction.
Having a transparent data management philosophy in place benefits every level, from executives to contract workers. All parties can become stakeholders in data collection, analysis, and decision activities, and all can answer ‘why’ data is important to the endeavour on a day-to-day basis. Additionally, a clear data management philosophy demonstrates that a company is willing to invest in the tools, processes, and training needed to culturally transform it into a data-driven organisation. Such companies are able to bring all their in-house and contracted teams along the data integration journey and reduce the action deficit for all involved.
Carving out a competitive advantage
Good data management, backed by a clear philosophy that is communicated to all stakeholders, can only produce positive results in driving the efficiencies needed to engage the energy transition. For the Middle East’s national oil companies, their performance in both energy sectors—both traditional and renewable—reflects directly on their nation’s government. Businesses, local workers and communities would benefit from better ROIs, improved safety, decreased unplanned outages and shutdowns, all as a result of increased data maturity, a reduced action deficit, and improved decision transparency.
With major onshore and offshore projects—such as the $20 billion Ruwais Refinery project, or the $15 billion Marjan Field Expansion—even modest savings and carbon reductions through data-driven efforts could make a difference in the industry. Ultimately, this will aid in attracting investors to the Middle East, who understand that how a company performs in its traditional energy industries will be a direct reflection of how it will likely perform in its energy transition, as putting best data practices in place now will help futureproof the Middle East’s energy transition tomorrow.