Living on a data island

An IOGP Task Force study has concluded that the oil and gas industry’s digitalization transformation has only just begun, despite having worked with increasingly large volumes of data and applying digital solutions for many years.

“In seeking to identify the most valuable digital opportunities for the industry, we propose two maxims: ‘a digital house needs a data foundation’ and ‘data liberalization requires separation between data and application’,” says Oscar van der Weide, Industry Digitalization Roadmap (IDR) Task Force chair.

A data foundation would provide a common language to enable the frictionless exchange of data between systems. Without this enabler, scaling of data applications is inefficient, expensive, or simply not possible.

“Operators would be stuck with local and often proprietary solutions and the supply chain would have to service a multitude of different client requirements,” he says.  “Operators, organized through IOGP, can take a leading role in selecting standard data models, structures and reference data, and in driving industry-wide adoption.”

The second maxim – separation of data and application to liberate data – enables data access, data exchange at scale, and innovation through new market services. “Without it we continue to live on data islands. IOGP can play an important facilitating role by actively supporting industry initiatives that are geared towards liberating data,” he adds.

“Digitalization is starting to make an impact on capital project delivery today, reducing site safety exposure, greenhouse gas emissions, execution schedules, and cost. There is clearly much more value to be had from digital, which will require standardization and collaboration across the supply chain. IOGP can play a very important role in accelerating the industry’s digital journey.”.

In 2020, IOGP established the IDR Task Force to develop a roadmap for the industry towards a fully digitalized future. Its research revealed broadly consistent messaging on important digitalization opportunities in capital project delivery, which included:

• establishing a single data language
• supply chain automation
• digitally-enabled project controls and work-front management
• project portfolio insights and performance tracking
• next generation Building Information Modeling (BIM)
• advanced analytics of portfolio metrics
• pre-construction analytics

“The prize is substantial,” says Oscar. “Digital enablement of work processes in capital project delivery is estimated to have a reduction potential of 15%[1] in total installed costs. For capital projects in upstream oil and gas (surface facilities only), this would amount to an annual saving of USD 20bln.[2]”

With collaboration agreements with the World Economic Forum (WEF) and the Open Group signed in 2020, the IDR Task Force has already started on implementation.

It is collaborating with WEF on a ‘data exchange’ initiative that seeks to facilitate faster convergence in oil and gas towards a common data language, and, with the Open Group, it is working to develop an ‘open’ energy data platform, and assess the viability of extending the platform functionality to include facilities lifecycle data.

[1] https://www.bcg.com/publications/2019/digital-value-oil-gas
https://www.mckinsey.com/industries/oil-and-gas/our-insights/how-the-oil-and-gas-industry-can-improve-capital-project-performance
https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/consultancy/deloitte-uk-the-capital-project-of-the-futurev4.pdf

[2] https://www.mckinsey.com/industries/oil-and-gas/our-insights/how-the-oil-and-gas-industry-can-improve-capital-project-performance#