Future Oil & Gas Summer 2024

Unleashing a New Era of Efficiency and Sustainability

Oil Giants Green Dreams

AI and Risk in Petroleum Industry

Transforming Oil and Gas Operations with Digital Twins Digital Transformation

Brings New Cybersecurity Threats

Satellite connectivity for upstream oil and gas

Global Call for Carbon Capture Technology

DIGITAL

DIGITAL TRUST by DNV

CEO

Mark Venables – Editor in Chief mark.venables@cavendishgroup.co.uk

Managing Director

Adam Soroka

Advertising Director

Mike Smith mike.smith@cavendishgroup.co.uk

The energy landscape is undergoing a monumental shift. With the pressing need to address climate change, the world is transitioning from traditional fossil fuels to more sustainable energy sources. At the heart of this transition lies a complex and often contentious debate: the role of oil and gas companies in our energy future.

Oil and gas companies have long been pillars of global energy supply, providing the lifeblood for economies worldwide. However, their role in contributing to greenhouse gas emissions has placed them under intense scrutiny. As the demand for cleaner energy grows, these companies face a pivotal moment. How they respond will significantly shape the trajectory of the energy transition.

Many oil and gas giants are already investing heavily in renewable energy projects. Companies like BP, Shell, and ExxonMobil are not just diversifying their portfolios; they are rebranding themselves as integral players in the green energy revolution. They are pouring billions into wind, solar, and hydrogen technologies, signalling a commitment to reduce their carbon footprint. This shift is not just a response to regulatory pressures but also a strategic move to remain relevant in a rapidly changing market.

Yet, the path forward is fraught with challenges. Critics argue that these efforts are often overshadowed by continued investments in oil and gas exploration and production. The question of whether these companies can genuinely lead the charge toward a sustainable future or if they are merely engaging in greenwashing remains open. Transparency, accountability, and tangible results will be crucial in addressing these concerns.

Moreover, the expertise and resources of oil and gas companies can play a vital role in scaling up renewable energy infrastructure. Their extensive experience in large-scale energy projects, complex logistics, and global supply chains provides a unique advantage in deploying new technologies swiftly and efficiently.

The energy transition is a collective journey. Governments, businesses, and consumers must work together to create a sustainable future. Oil and gas companies, with their vast capabilities and resources, have a critical role to play. By embracing innovation, committing to genuine sustainability goals, and leveraging their strengths, they can help drive the world towards a cleaner, more resilient energy system.

As we navigate this transition, let us hold these companies accountable while recognizing the potential they hold in shaping a sustainable energy future. Together, we can forge a path that balances economic growth, energy security, and environmental stewardship.

Mark Venables Editor-in-Chief

+44 (0)203 675 9530

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Oil and gas companies are shedding their fossil fuel image and investing heavily in renewable energy to lead the charge towards a low-carbon future.

The use of artificial intelligence (AI) is expanding in the oil and gas sector, and the Norwegian Ocean Industry Authority (Havtil) expects continued growth. What will this mean for the risk picture?

Digital twins are revolutionizing the oil and gas sector by enhancing efficiency, safety, and sustainability through real-time insights and predictive capabilities

As the oil and gas sector embraces digitalisation, it faces unprecedented cybersecurity risks that demand robust defensive strategies

Future Digital events create a vibrant space for collaboration, sharing and insights across industry, one where companies can collectively improve their understanding of how digital leads to a more effective, streamlined and value-generating industry.

As AI revolutionises the oil and gas industry, it promises unprecedented efficiency, safety, and environmental benefits while posing new ethical and operational challenges

gas operators must urgently develop and deploy Carbon Capture, Utilization, and Storage (CCUS) technologies to significantly reduce greenhouse gas emissions and combat climate change

industrial metaverse revolutionises the oil and gas sector by enhancing operational efficiency,

and sustainability through advanced

As Mark Venables explains the oil and gas industry faces technological advancements, environmental challenges, and shifting economic dynamics, it must adapt to stay relevant and sustainable.

The future of oil and gas is digital

The oil and gas sector must embrace new digital business models, collaborate with the supply chain, and leverage data to improve performance and achieve its sustainability and decarbonisation goals. At Baringa we help our clients harness the power of data and digitalisation to enable data-driven decision making and unlock speed, efficiency, and agility through digital transformation.

Wood to deliver three-year engineering contract with TotalEnergies in Iraq

Wood has been awarded a new $46 million, three-year contract by TotalEnergies in Iraq.

Wood will provide front-end engineering design (FEED), detailed design, procurement support, and construction and commissioning assistance for the first phase of the Associated Gas Upstream Project, part of the Gas Growth Integrated Project (GGIP) in Southern Iraq. The GGIP includes the recovery of gas currently flared in the Basra region to supply power generation plants, along with the construction of a seawater treatment unit and a 1GW solar power plant.

“We are proud to support TotalEnergies on this project, which aligns with our shared commitment to pursue a secure and sustainable energy supply,” Shaun Dewar, Senior Vice President of Operations, Middle East and Africa at Wood said. “We have a long-standing history of delivering engineering and consulting services in the region and this contract reaffirms our reputation for excellence.

“This project will improve environmental sustainability through emissions reduction efforts. As part of this agreement, Wood will also continue to invest in local employment and skills development in the Basra region.”

The contract will be delivered by Wood’s teams in Basra and Dubai, creating 100 new positions. Wood currently employs over 1,300 people in Iraq and the UAE.

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Easily upload reality capture data from terrestrial scanners, mobiles or drones to the Cintoo platform. Detect, view, share and manage your assets and equipment in their existing conditions and connect them to your Digital Twin, document management or IoT platforms with asset tagging. Compare your as-built conditions to your CAD or BIM models.

Bring your reality capture data, CAD models and GIS information into cloud-based, collaborative workflows and use this single source of trustful information for asset management, predictive maintenance, safety monitoring and quality control.

Discover how oil & gas companies are leveraging their data in Cintoo to improve decision-making and reduce downtime by visiting our website:

Aker Solutions secures long-term brownfield and modification frame agreement

Aker Solutions has secured a sizeable long term frame agreement with Azule Energy to provide engineering, procurement, and construction services (EPC) for brownfield projects and modifications for two FPSOs in Angola. This is a continuation of the current frame agreement Aker Solutions has with the operator Azule Energy. The operator is Angola’s largest independent equity producer of oil and gas and is an incorporated joint venture owned by Eni and bp.

The scope of work is focused on two FPSO (floating production, storage, and offloading) units, namely

Greater Plutonio and PSVM. The work comprises engineering, procurement, and construction services (EPC) of the brownfield maintenance and modifications scopes.

The contract is a frame agreement covering maintenance and modifications activities with a duration of three years plus two one-year options. The contract will be executed and delivered by the Aker Solutions’ team based in Luanda, Angola, and Aberdeen, UK. The project management will be based in Angola to be close to the operation and continue to develop locally.

“We are building on our robust track record in Angola, dating back to 1998,” Paal Eikeseth, executive vice president and head of Life Cycle, Aker Solutions, said. “Aker Solutions is a leading service operator and has a clear ambition to grow internationally. This new contract strengthens our global life cycle operations and is a pivotal project for our offices in Aberdeen and Luanda.”

Throughout the current contract period, there has been substantial growth in terms of in-country execution and the development of Aker Solutions’ local workforce. Currently, over 40 percent of the total scope volume is being executed in Angola, and a significantly increased target has been set for the new contract period.

“We are actively recruiting to enhance the strength and competence of our existing project team,” Eikeseth added. “Moving forward, our local business development efforts will focus on improving and strengthening relationships with local subcontractors, as well as hiring and training local personnel. We are pleased to have received renewed trust from Azule Energy and will continue to ensure the delivery of reliable and safe executions to safeguard the integrity of the FPSOs.”

Mega gas project off the coast of Africa nears final stages before start-up

Seven years in the making, something remarkable is taking shape in the ocean where Mauritania and Senegal meet. A project, which includes a breakwater, subsea, a floating liquefied natural gas facility (FLNG), and floating production, storage and offloading vessel (FPSO) – each an engineering feat in its own right – is now in place as the finish line approaches for the development of the Greater Tortue Ahmeyim Phase 1 mega-project.

GTA Phase 1, as it i known for short, is expected to produce up to 2.3 million tonnes of liquefied natural gas (LNG) per year, helping to meet global demand, and boosting the economies of these two developing economies.

“It’s a massive civil engineering project, two massive shipbuilding projects, and a massive pipelines project all in one – and they all need to be safely and flawlessly integrated,” Alan Edwards, project general manager for GTA subsea, said.

When complete, GTA will be operated by bp on behalf of its partners, including Kosmos Energy, PETROSEN and SMH. Subsea pipelines and infrastructure – the deepest in Africa – will feed into a floating production, storage and offloading vessel (FPSO) that will process gas delivered from wells 2,800 metres underwater, around three times the height of the world’s biggest skyscraper, the Burj Khalifa.

Constructed in China over the course of six years, the FPSO arrived at its GTA home in May 2024, 40 kilometres offshore. With this final major piece of the puzzle in place, the

project can move ahead towards commissioning, start-up and first gas production.

“The scale of the technology and engineering required for this project was in a league of its own,” Anil Senol, project general manager tasked with the transportation and installation of the FPSO, said. “The FPSO alone came with a set of unique challenges – from transporting it to the Atlantic from China, to battling damaging typhoons,”

Connected to the subsea network by flexible pipelines, the FPSO will remove water, other liquids and impurities before the gas is transferred by another pipeline to a floating liquefied natural gas vessel (FLNG), called Gimi, which is owned and operated by Golar LNG.

Located 10 kilometres offshore, Gimi is berthed at a specially-built hub terminal. This includes a 1.25-kilometre-long breakwater made up of 21 giant 16,000-tonne concrete structures, each nearly the size of the Arc de Triomphe. It was constructed to protect both Gimi and visiting LNG carriers from bad weather.

Once the gas arrives at the FLNG facility, it will be cooled to temperatures below minus 160ᵒC to transform it into liquefied natural gas. In total, Gimi is designed to produce around 2.3 million tonnes of LNG a year. Visiting LNG carriers will then take the LNG to its buyers.

Baker Hughes Awarded Major Integrated Solutions Contract for Petrobras’ Offshore Fields

Baker Hughes has announced a significant order from Petrobras for workover and plug and abandonment (P&A) services in pre-salt and post-salt fields offshore Brazil. The multi-year project, set to start in the first half of 2025, will be managed with Baker Hughes’ integrated solutions portfolio to optimize performance for Petrobras. Baker Hughes’ integrated approach will deploy wireline, coiled tubing, cementing, tubular running, wellbore intervention, fishing, and geosciences services in all of Petrobras’ offshore fields. The agreement also includes Baker Hughes remedial tools, completion fluids and production chemicals.

“Baker Hughes brings to this important project a comprehensive technology portfolio, a deep understanding of localization, and a rich history of working in Brazil,” Maria Claudia Borras, executive vice president, Oilfield Services & Equipment at Baker Hughes, said. “Flawlessly integrating these capabilities will be essential to the success of the project. Our expertise in integrated solutions is the foundation for efficiently taking energy forward in Brazil.”

To support the project and help advance Latin America’s energy landscape, Baker Hughes will expand its Macaé (Rio de Janeiro) facilities to include coiled tubing and tubular running services, contributing to the further growth of Brazilian industry and its workforce.

Platform ship Marechal Duque de Caxias arrives in Brazil on its way to the pre-salt layer

The platform ship Marechal Duque de Caxias has arrived in Brazil from China, heading for the Mero field in the pre-salt Santos Basin. The platform of the FPSO type (floating production, storage, and transfer unit) can produce up to 180,000 barrels of oil and compress up to 12 million cubic meters of gas, all daily. The unit will start operating in the second half of this year.

The FPSO left the shipyard in Yantai, China, in February this year and then made a stop in Mauritius, Africa, to change crew and move cargo. In Brazil, the unit will be installed in the Mero field, where it will be connected to the wells and subsea equipment. Before starting production, the FPSO will undergo legal procedures and final tests of the production equipment.

The Marechal Duque de Caxias FPSO, chartered from MISC, will increase the field’s installed production capacity to 590,000 barrels of oil daily. This production system provides for the interconnection 15 wells to the unit, 8 oil producers, and 7 water and gas injectors through a subsea infrastructure comprising 80 km of rigid production and injection pipelines, 47 km of flexible service pipelines, and 44 km of control umbilicals.

The FPSO is part of the 3rd Mero definitive production system, in which Petrobras intends to implement HISEP technology from

2028, which will separate the oil and gas at the bottom of the ocean, from where it will reinject the CO2-rich gas in a pioneering way. The FPSO Marechal Duque de Caxias has other technologies to reduce emissions, such as CCUS (Carbon Capture, Utilization, and Storage), where CO2-rich gas is reinjected into the reservoir.

tengizchevroil starts WPMP operations at tengiz oil field in Kazakhstan

Chevron Corporation has announced that its 50 per cent owned affiliate Tengizchevroil (TCO) has safely commenced operations at its Wellhead Pressure Management Project (WPMP) at the Tengiz oil field in Kazakhstan.

TCO achieved this milestone by converting its first metering station at Tengiz to low pressure and activating the associated Pressure Boost Facility (PBF). This marks important progress for TCO’s overall expansion project at Tengiz.

The WPMP is designed to maintain the existing processing plants’ full capacity

(approx. 28 million tonnes per annum), by lowering the flowing pressure at the wellheads and then boosting the pressure to the existing plants.

“This is a significant step towards completion of the Future Growth Project (FGP),” Clay Neff, President of Chevron International Exploration and Production, said. “It is also important progress for the modernization of the existing base business at Tengiz and demonstrates TCO’s commitment to safely and reliably manage operations, while maximizing the ultimate recovery of resources critical to global energy security.”

The start-up of additional PBF compressors and the conversion of the remaining metering stations in the oil gathering system at Tengiz, from high pressure to low pressure, is scheduled for completion through the remainder of the year.

The final phase of TCO’s expansion project, FGP, is on track to conclude in the first half of 2025. This will enable TCO to expand Tengiz crude oil production by an incremental 12 million tons per annum (260,000 barrels a day).

“This accomplishment highlights the vital role of partnership,” Derek Magness, Managing Director of Chevron’s Eurasia Business Unit, added. “Together with the Republic of Kazakhstan and our other partners, we have safely started operations at the WPMP, which is a positive development as we continue our focus on the FGP-WPMP expansion project.”

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Fugro relocates Amberjack self-elevating platform to Japan

Fugro has transferred their selfelevating platform (SEP) Amberjack to Japan to meet the country’s growing demand for offshore wind geotechnical services. Under Japanese regulations, vessels registered in Japan follow a more streamlined procedure than foreignflagged vessels when deployed for fieldwork, so this move will speed up mobilisation to project sites and allow faster delivery of Fugro’s

accurate Geo-data to the country’s developing offshore wind industry.

The Amberjack was reflagged in December 2023 and is now based in Tokyo, from where it will be deployed to wind farm projects in Japan and provide clients with geotechnical borehole drilling, high-quality sampling, and a range of in situ tests, such as downhole cone penetration tests (CPTs) and standard penetration tests (SPTs). Fugro’s Amberjack also delivers downhole geophysical logging for preliminary and detailed geotechnical surveys, and cable route surveys. All of the SEP’s capabilities comply with international and Japanese geotechnical standards down to a maximum water depth of 42 m.

“Transferring the Fugro Amberjack to Japan will help us respond faster to our country’s growing demand for geotechnical SEP services,” Junichi Kuwamura, Fugro’s Country Manager for Japan, said. “The Japanese government targets 10 GW of offshore wind developments by 2030 and 30 GW to 45 GW by 2040. Our Geo-data solutions support the energy transition and are helping to make renewable energy the main source of power in Japan, and we’re proud to have this new asset ready to accelerate the development of Japanese offshore wind farms.”

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Digital Transformation in the Oil and Gas Industry Unleashes New Era of Efficiency and Sustainability

The integration of AI, IoT, big data, and cloud computing is revolutionising the oil and gas sector, driving enhanced operational efficiency, improved safety, and environmental sustainability

Traditionally seen as conservative and slow to change, the oil and gas sector is undergoing a significant transformation through digitalisation. This shift, driven by the need to enhance efficiency, improve safety, and minimise environmental impact, reshapes how companies explore, extract, and process hydrocarbons. The integration of advanced technologies such as artificial intelligence (AI), the Internet of Things (IoT), big data analytics, and cloud computing lies at the heart of this revolution, promising to bring about unprecedented changes in the industry.

Several factors are propelling this digital transformation. Firstly, the industry faces mounting pressure to reduce costs and improve operational efficiency amid volatile oil prices. The fluctuations in global oil markets have made companies need to find ways to streamline their operations and cut unnecessary expenses. Secondly, there is a growing need to enhance safety

and minimise environmental impact. Accidents and spills have severe ecological consequences and incur substantial financial and reputational costs. Lastly, technological advancements have made digital solutions more accessible and costeffective, encouraging their adoption across the sector.

A myriad of technologies driving digitalisation

Artificial Intelligence (AI) and Machine Learning (ML) are at the forefront of this transformation, optimising exploration and production activities. For instance, AI algorithms can analyse seismic data to identify potential oil reserves more accurately and quickly than traditional methods. This speeds up the exploration process and reduces the risk of drilling in unproductive areas.

Machine learning models predict equipment failures before they occur, enabling proactive maintenance and reducing downtime. Shell’s use of AI in predictive maintenance is a noteworthy example. By employing machine learning algorithms, Shell can predict when equipment will

likely fail, allowing for timely interventions that prevent costly unplanned outages and improve overall operational efficiency.

The Internet of Things (IoT) is crucial in digitalising the oil and gas sector. IoT devices collect realtime data from equipment and infrastructure, providing insights to enhance operational efficiency and safety. Sensors on drilling rigs, pipelines, and refineries monitor parameters such as temperature, pressure, and vibration, helping operators make informed decisions. BP has implemented IoT technology extensively in its operations. By deploying sensors on its offshore platforms, BP can monitor and analyse data in real time, improving the safety and efficiency of its operations. This real-time monitoring allows for immediate responses to anomalies, thereby preventing accidents and ensuring smoother operations.

Big data analytics is another cornerstone of the digital transformation in the oil and gas sector. The vast amounts of data generated by the industry can be harnessed to drive decision-

making. Analysing geological data helps identify new exploration opportunities while processing operational data, which can optimise production and reduce costs. Chevron’s investment in big data analytics exemplifies this approach. The company processes and analyses terabytes of geological and operational data, leading to more accurate decision-making and improved exploration success rates. By leveraging big data, Chevron can optimise its exploration and production strategies, resulting in significant cost savings and enhanced efficiency.

Cloud computing provides the computational power and storage capacity needed to handle the massive data sets generated by the oil and gas sector. Cloud-based solutions facilitate collaboration and data sharing across different locations and departments, enabling more integrated and efficient operations. ExxonMobil leverages cloud computing to enhance its data management capabilities. By migrating its data to the cloud, ExxonMobil can access and analyse data more efficiently, supporting its global operations. This move to the cloud not only improves data accessibility but also enhances security and scalability, allowing the company to adapt quickly to changing operational needs.

Digital twins, virtual replicas of physical assets, processes, or systems, also make significant inroads in the oil and gas sector. They allow operators to simulate and analyse real-world scenarios in a virtual environment, enabling better planning and decision-making. Equinor, a leading Norwegian energy company, uses digital twins for its offshore platforms. These digital replicas help Equinor optimise production, plan maintenance activities and enhance safety by simulating various operational scenarios. By using digital twins, Equinor can test different strategies and procedures in a virtual environment before implementing them in the real world, reducing risks and improving overall efficiency.

Reaping the rewards of digitalisation

The digital transformation of the oil and gas sector offers numerous benefits. One of the most significant advantages is enhanced operational efficiency. Digital technologies streamline operations, reduce downtime, and optimise resource utilisation. Predictive maintenance and real-time monitoring minimise equipment failures

and improve productivity, leading to substantial cost reductions.

Digitalisation helps lower operational costs by improving operational efficiency and reducing waste. Automated processes and data-driven decision-making also contribute to cost savings. Improved safety is another critical benefit. Realtime monitoring and predictive analytics enhance safety by identifying potential hazards before they lead to accidents. Digital twins and simulations help operators plan and execute maintenance activities safely, minimising risks to personnel and the environment.

Environmental sustainability is crucial to digital transformation in the oil and gas sector. Digital solutions enable more efficient resource extraction and utilisation, reducing operations’ environmental footprint. Enhanced monitoring and data analysis help detect and mitigate environmental risks, contributing to more sustainable practices. Better decision-making is another significant benefit. Access to real-time data and advanced analytics empowers decisionmakers with actionable insights. This leads to more informed and accurate decisions, improving overall business performance and competitiveness.

Overcoming the hurdles on the path to a digital future

Despite the clear benefits, the digitalisation of the oil and gas sector faces several challenges. Data security and privacy are major concerns. The vast amount of data generated and shared across digital platforms raises the risk of cyber threats. Implementing advanced cybersecurity protocols, such as encryption, access controls, and regular security audits, is essential to protect sensitive information. Collaboration with cybersecurity experts is also crucial to address these challenges effectively.

Integration with legacy systems is another significant hurdle. Many oil and gas companies still rely on legacy systems that may not be compatible with modern digital solutions. Integrating new technologies with existing infrastructure can be complex and costly. Adopting a phased approach to digitalisation, where new technologies are gradually integrated with legacy systems, can minimise disruption. Investing in middleware solutions that facilitate seamless integration is also beneficial.

Workforce readiness is a critical factor in the success of digital transformation. The transition to digital operations requires a workforce with new skills and competencies. Training and reskilling employees to adapt to digital tools and processes is essential. Companies should invest in comprehensive training programs to upskill their workforce. Collaborating with educational institutions and technology providers can also help bridge the skills gap, ensuring employees are wellprepared for the digital future.

Another challenge is the high initial investment. Implementing digital technologies often involves significant upfront costs, which may challenge smaller companies. Exploring financing options, such as partnerships, joint ventures, and government incentives, can help alleviate the financial burden. Demonstrating the long-term return on investment (ROI) of digitalisation projects is also crucial to secure buy-in from stakeholders.

A bright future for digital oil and gas

The future of digitalisation in the oil and gas sector looks promising, with several trends likely to shape its trajectory. Increased automation will become more prevalent, reducing the need for human intervention in hazardous environments. Autonomous drilling rigs and robotic inspection systems are examples of this trend. Advanced AI and analytics will enable deeper insights and

more accurate predictions, enhancing operational efficiency and safety. Integrating AI with other technologies, such as blockchain, could also improve transparency and efficiency in the sector.

Sustainability and green technologies will gain prominence as the industry seeks to reduce its environmental impact. Digitalisation will play a crucial role in advancing sustainability initiatives, enabling more efficient energy use, carbon capture and storage, and the integration of renewable energy sources. Collaboration and ecosystem development will be essential to drive innovation. Developing an ecosystem that fosters knowledge sharing and joint problem-solving will be vital to overcoming challenges and maximising the benefits of digitalisation.

Governments and regulatory bodies will play a crucial role in shaping the digital future of the oil and gas sector. Supportive policies and regulations that encourage investment in digital technologies and address security and privacy concerns will be vital. As technology evolves, the oil and gas sector is poised to enter a new era of innovation and growth driven by digital transformation. The ongoing digitalisation represents a paradigm shift that promises to transform the industry, bringing about unprecedented efficiency, safety, and sustainability levels.

CASE STUDY ARE FIBER CONNECTIONS TO OT SYSTEMS A SECURE CHOICE?

Secure use of third-party fiber connection services in OT production network enabled by Zybersafe’s layer 2 ethernet encryption solution.

The challenge

O -shore and on-shore production plants in the oil & gas industry are hazardous work environments where security is of paramount importance to the safety of sta and the plant. As a result, it’s natural for oil & gas operators to replace on-site support with remote support from centrally placed control centres. However, remote access to industrial systems need to protect the integrity of data transmission in order to prevent ‘man-in-the-middle’ attacks that could compromise the operation of vital systems in the production plants.

In the age of digitalization, OT data integrity has become a cornerstone of secure remote management and a fundamental element in providing secure authentication, control, and feedback data. The challenge is to protect data integrity when transmitted through areas or networks that are not in full control of the operator. Especially when data is transmitted over external fibres or leased lines between the operator’s sites.

Normally, an operator relies on third parties to provide data connections between locations which have established leased lines supplied by various fiber suppliers.

Therefore, the requirement is to protect data integrity during the time where data is outside the operator’s domain, until it reaches its destination. When data is outside of an operators’ control, there is a risk of compromise or an attack, either due to misconfigured or ill-maintained network equipment or due to malicious acts or human error in the hands of third-party sta .

Furthermore, it is essential that remote support can be done with near-zero latency to ensure access to industrial systems can be done in real-time by o -site sta . If a sensor readout requires the remote supporter to react, they must be able to react as swiftly as an on-site supporter would.

“Near zero latency and secure key management in Zybersafe encryption solution enabled us to use third party connection services in our production network”

Quote from Oil and Gas Operator

Oil Giants Green Dreams for the Future of Clean Energy

Oil and gas companies are shedding their fossil fuel image and investing heavily in renewable energy to lead the charge towards a low-carbon future.

The global energy landscape is undergoing a significant transformation as the urgency to address climate change becomes more pronounced. At the heart of this shift are oil and gas companies, historically major contributors to greenhouse gas emissions, now poised to play a pivotal role in the transition to a low-carbon energy future.

For decades, oil and gas companies have been synonymous with fossil fuels, driving industrial growth and economic development worldwide. However, the environmental impact of fossil fuel consumption has led to increasing pressure from governments, investors, and the public to reduce carbon emissions and adopt more sustainable practices. In response, many oil and gas companies are re-evaluating their business models, investing in renewable energy sources, and setting ambitious targets for reducing their carbon footprints.

Investing in clean energy

One of the most significant ways oil and gas companies are contributing to the energy transition is through the diversification of their energy portfolios. Companies such as BP, Shell, and TotalEnergies have announced substantial investments in renewable energy projects, including wind, solar, and biofuels. These investments are not merely token gestures; they represent a strategic shift towards integrating renewable energy into their core operations. For instance, BP has pledged to increase its renewable energy capacity to 50 gigawatts by 2030, a move that underscores its commitment to a lowercarbon future.

In addition to investing in renewable energy, oil and gas companies are also focusing on developing and deploying advanced technologies to reduce emissions. Carbon capture and storage (CCS) is one such technology that has garnered significant attention. CCS involves capturing carbon dioxide emissions from industrial processes and storing them underground to prevent them from entering the atmosphere. Companies like ExxonMobil and Chevron are at the forefront of CCS research and implementation, recognizing its potential to mitigate emissions from both fossil fuel and industrial sources.

The integration of digital technologies is transforming the way oil and gas companies operate, leading to more efficient and environmentally friendly practices. The use of big data, artificial intelligence, and the Internet of Things (IoT) allows for real-time monitoring and optimization of energy production processes, reducing waste and lowering emissions. For example, predictive maintenance enabled by AI can prevent equipment failures and leaks, which are significant sources of methane emissions in the oil and gas industry.

The role of gas in the energy future

Another critical aspect of the energy transition is the shift towards natural gas, which is seen as a bridge fuel due to its lower carbon intensity compared to coal and oil. Many oil and gas companies are increasing their natural gas production and infrastructure to support the transition to a cleaner energy mix. Liquefied natural gas (LNG) projects are expanding globally, with companies like Qatar Petroleum and Royal Dutch Shell leading the way in developing new markets and supply chains. The increased use of natural gas in power generation and transportation can help reduce carbon emissions while renewable energy capacity continues to grow.

Collaboration and partnerships are also playing a crucial role in the energy transition. Oil and gas companies are increasingly partnering with technology firms, renewable energy companies, and academic institutions to drive innovation and develop new solutions for a sustainable future. For instance, the Oil and Gas Climate Initiative (OGCI), a consortium of major oil and gas companies, is working collectively to invest in low-carbon technologies and projects that can significantly reduce greenhouse gas emissions. Such collaborations are essential for pooling resources, sharing knowledge, and accelerating the development and deployment of new technologies.

Driven by targets and investors

There is a recognition from oil and gas companies of the importance of aligning their business strategies with global climate goals, such as the Paris Agreement. Many companies have set targets to achieve net-zero emissions by midcentury, with some aiming to reach this goal even sooner. These targets are often accompanied by detailed plans outlining

how they will reduce emissions across their operations and supply chains, invest in low-carbon technologies, and support policies that promote a sustainable energy transition.

Investor pressure is another driving force behind the oil and gas industry’s pivot towards sustainability. Institutional investors, including pension funds and asset managers, are increasingly prioritizing environmental, social, and governance (ESG) criteria in their investment decisions. This shift is prompting oil and gas companies to enhance their transparency and reporting on climate-related risks and opportunities. By demonstrating a commitment to sustainability, these companies can attract long-term investment and maintain their social license to operate.

The role of oil and gas companies in the energy transition extends beyond their direct operations. These companies

possess extensive expertise in large-scale project management, complex supply chains, and technological innovation, all of which are critical for scaling up renewable energy and lowcarbon technologies. By leveraging their existing capabilities and infrastructure, oil and gas companies can accelerate the deployment of renewable energy projects and contribute to the development of a resilient and diversified energy system.

Tough challenges on the road to a low-carbon future

However, the transition to a low-carbon future is not without its challenges. The oil and gas industry must navigate a complex landscape of regulatory changes, market dynamics, and technological advancements. Balancing the need to meet current energy demands with the imperative to reduce emissions requires a delicate and strategic approach. Additionally, the economic implications of the transition, including potential job losses in

traditional oil and gas sectors, must be addressed through policies that support workforce retraining and the creation of new employment opportunities in the renewable energy sector.

Public perception and social responsibility also play a significant role in shaping the future of the oil and gas industry. Companies are increasingly aware that their social license to operate depends on their ability to act responsibly and transparently. Engaging with stakeholders, including local communities, governments, and environmental organizations, is essential for building trust and ensuring that the transition to a low-carbon economy is inclusive and equitable.

Oil and gas companies are at a crossroads as they navigate the energy transition. While they have historically been associated with fossil fuels and carbon emissions, they are now positioned to be key players in the move towards a low-carbon

energy future. Through strategic investments in renewable energy, advanced technologies, and collaborative efforts, these companies are demonstrating a commitment to sustainability and innovation. The expertise and resources they bring to the table are invaluable for accelerating the deployment of clean energy solutions and achieving global climate goals.

As the world continues to grapple with the challenges of climate change, the role of oil and gas companies in the energy transition will remain crucial. By embracing change, leveraging their strengths, and fostering collaboration, they can contribute significantly to a sustainable and resilient energy future. The journey ahead is complex and demanding, but with concerted efforts and a clear vision, the oil and gas industry can help drive the global transition to a low-carbon economy, ensuring a cleaner, healthier, and more sustainable planet for future generations.

AI and Risk in Norway’s Petroleum Industry

The use of artificial intelligence (AI) is expanding in the oil and gas sector, and the Norwegian Ocean Industry Authority (Havtil) expects continued growth. Eileen Brundtland of Havtil asks what will this mean for the risk picture?

“AI can be a resource and help to reduce risk, but this assumes that the companies understand and actively follow up the hazards when new technology is developed and adopted,” Linn Iren Vestly Bergh, a senior adviser at Norwegian Ocean Industry Authority (Havtil), who heads its follow-up of the industry’s work in this field, says. “Many of the risks associated with AI differ from those we have experience of from the petroleum sector and conventional IT systems. Machine Learning is a key component in many AI systems. But how well ML functions depends on both the quality of the data used to train it and the method applied for this process.”

Lack of accurate training data might mean the end results put users on the wrong track, she points out. “It’s not always easy to detect such errors, particularly in complex systems. Weaknesses in data for and training of the ML model could also cause it to fail to recognise rare or unusual circumstances. That can create problems in reacting correctly when an unfamiliar event occurs.

“We see examples of AI being applied in the industry and expect this to rise in coming years. But utilising it in different operations and products is at an early stage, with a high level of testing and product development.”

She cites condition monitoring and maintenance planning, autonomous cranes, automated drilling, and security of ICT systems as areas where AI is being developed and tested as part of solutions. As AI progresses and is adopted in operations with safety significance, securing acceptable data quality and management, maintenance, meaningful human control, openness and transparency will become ever more important. That applies particularly to sectors like petroleum which involve major accident risk.

Havtil is also seeing a desire to use fully developed components or complete products

even when these have often been developed for other industries or purposes. Cutting costs and simplifying integration in existing digital ecosystems are drivers for this approach. “It’s the companies which have to own and control the risk when introducing new systems and technology,” Bergh emphasises. “That also applies when procuring products and solutions. The companies are responsible for following up prudent development and application of AI systems. This calls for a multidisciplinary approach and internal interaction in both companies and the industry.”

AI poses significant risk factors

AI systems also present other risk factors which may be significant for the threat of major accidents. Examples include lack of transparency and weak user interfaces as well as complexity and inadequate documentation giving poor traceability. AI can also be misused, creating possible vulnerabilities to deliberate attack.

Bergh emphasises that good technology development is also about people, and says that AI must be viewed from an integrated perspective. “This will allow factors associated with humans, technology and organisation (HTO) to be incorporated in developing, using and

maintaining the solutions,” she adds. “Handling and assessing vulnerabilities and risk must also take account of human possibilities and limitations.”

The danger of complicated computer models

Offshore workers have largely moved from acquiring information in the field with the aid of eyes, ears, nose, and manual measurements and calculations to evaluating predictions presented on a screen, usually based on an ML system. “Digital solutions can produce good and precise results,” Bergh says. “But the underlying systems may be so complex that people have difficulty understanding them.”

That opens the way to new sources of error – and increased risk. Some computer models are so complicated that decision-makers fail to grasp why particular recommendations are made, an issue often termed the black-box problem. It can also be difficult subsequently to explain the results presented by complex models. Comprehending decision processes in models based on neural networks can be demanding, for example.

“Even though tools to inspect such models are being developed, we believe that devoting enough resources for continued development of tools and methods for inspection and risk management is crucial,” Bergh adds. “We see that the companies use AI solutions as decision support, where people still have a hand on the wheel. But a danger also exists that the supervising person’s attention wanders – partly because the work becomes routine, or the ‘truth’ presented by the AI system clouds their judgement.”

The need for vigilance

Human error often occurs because a gap exists between technological and human traits. Introducing AI will increasingly reduce personnel to a supervisory and passive role. That creates a need for vigilance – in other words, the ability to detect errors and react quickly if abnormal circumstances occur. Experience shows that simple monitoring fails to make optimum use of people’s intrinsic strengths.

“Training and education are key, but the system must be designed with humans at the centre,” Bergh observes. “That’s an important issue which we highlight in our audits, but one which experts are also raising to a great extent as the technology becomes more complex.”

Havtil will be devoting increased attention during coming years to safety-related aspects of AI in the petroleum sector. “Our ambition is to ensure that safe and beneficial operating parameters are established for AI use while actively following up that the industry manages risk factors related to developing and maintaining such solutions,” Bergh explains.

The authority will work in the next few years to increase knowledge about risk factors associated with using AI in operations of significance for offshore safety. A key place will be given in this work to the uncertainty related to the actual AI models and best practice for developing safe and reliable AI solutions.

Lack of guidelines for managing AI systems

Several meetings were held by Havtil with petroleum-sector operators and suppliers

in 2023 to secure information about their work with AI. “These sessions showed that the industry has ambitious goals for applying this technology to improve efficiency and safety,” Bergh continues. “Risk management of AI is an immature field in general, and that’s reflected in our industry. We see the players have started work on this, but that it’s in an early phase.”

It emerged from the meetings that the companies are making efforts to establish appropriate and systematic methods for identifying and managing AI-related risk. However, practice for developing and maintaining such systems is less established. As a result, the guidelines for managing the systems are not in place either.

“Although applying AI is in a start-up phase, we see that it’s already being used in planning and decision-support systems,” Bergh notes. “So it’ll be important to look at how the companies can utilise the technology in the safest possible way. “Another important goal will be to strengthen our enforcement powers through regulation, audits and advice on following-up AI in the industry.”

The crucial role of HSE regulations

The health, safety and environmental regulations for Norway’s petroleum sector are performance-based, technologically neutral and built on risk-management principles. “Regulation can play a key role in innovation by providing stable and predictable operating parameters for companies in the industry with regard to both development and application,” Bergh says.

Havtil is now taking a closer look at the legal challenges posed by using AI in the petroleum sector. These include the relationship between principles and requirements in the HSE regulations and AI’s unique characteristics. “Our assessment so far is that the HSE regulations specify a number of requirements which also apply to the use of AI,” Bergh explains. “However, risk factors could exist which will require further development of the regulations and their associated guidance.

“References to norms and standards for AI can be included in the guidance section as and when required. Over time, such references might cover existing and forthcoming standards, recommendations and compliance assessments, which is in line with the way the regulations already function.”

Utilising AI in a prudent fashion

“The question in the future will be less about whether we’re going to adopt AI and more about how we do this in a prudent way,” Bergh concludes. “It’s important for this work that employers, employees and government collaborate, engage with it, and contribute experience and expertise.”

Transforming Oil and Gas Operations with Digital Twins

Digital twins are revolutionizing the oil and gas sector by enhancing efficiency, safety, and sustainability through real-time insights and predictive capabilities

The oil and gas sector, characterised by its high capital investment, complex operations, and stringent safety requirements, has increasingly embraced digital innovation to enhance efficiency and sustainability. One of the most transformative technologies in this regard is the digital twin. A digital twin is a virtual replica of a physical

asset, system, or process, powered by real-time data and advanced analytics. This technology allows companies to simulate, predict, and optimize their operations in ways previously unimaginable. This article explores the applications, benefits, and challenges of

DIGITAL TWINS

digital twins in the oil and gas industry.

Applications of digital twins in oil and gas

Digital twins are being used extensively across various stages of the oil and gas value chain, from exploration and production to transportation and refining. In the exploration phase, digital twins of geological formations are created using seismic data, well logs, and other geological information. These digital models enable geoscientists to simulate drilling scenarios, assess reservoir characteristics, and optimise well placement, thus reducing the risk of dry wells and maximising resource recovery.

In production, digital twins of offshore platforms, drilling rigs, and other critical infrastructure help monitor and manage operations. By integrating data from sensors, control systems, and historical records, these digital replicas provide a comprehensive view of equipment performance and process efficiency. For instance, operators can simulate various production strategies, predict equipment failures, and schedule maintenance activities proactively, thereby minimising downtime and enhancing productivity.

Transportation of oil and gas via pipelines and tankers also benefits from digital twins. Virtual models of pipelines, for example, allow operators to monitor flow rates, detect leaks, and predict corrosion or other integrity issues. This predictive capability is crucial for maintaining pipeline safety and preventing environmental disasters. Similarly, digital twins of LNG (liquefied natural gas) carriers enable real-time monitoring of voyage conditions, optimising route planning, and ensuring the safe delivery of cargo.

In refining, digital twins of processing units such as distillation columns, reactors, and heat exchangers enable operators to optimise plant performance. By simulating different operating conditions and process adjustments, refiners can maximise throughput, improve energy efficiency, and reduce emissions. Additionally, digital twins facilitate advanced

process control and predictive maintenance, further enhancing operational reliability and profitability.

Benefits of digital twins in oil and gas

The adoption of digital twins in the oil and gas sector offers numerous benefits, driving significant improvements in efficiency, safety, and sustainability. One of the primary advantages is enhanced operational efficiency. Digital twins enable real-time monitoring and optimisation of processes, leading to better resource utilisation and reduced operational costs. For example, by simulating various production scenarios, operators can identify the most efficient strategies, minimising energy consumption and maximising output.

Another significant benefit is improved asset management. Digital twins provide a detailed and dynamic representation of equipment and infrastructure, allowing for predictive maintenance and timely interventions. This proactive approach helps prevent unplanned downtime, extends the lifespan of assets, and reduces maintenance costs. Furthermore, digital twins facilitate better planning and scheduling of maintenance activities, ensuring minimal disruption to operations.

Safety is a critical concern in the oil and gas industry, and digital twins play a vital role in enhancing safety standards. By providing real-time insights into equipment health and process conditions, digital twins enable early detection of potential hazards and anomalies. This early warning system allows operators to take preventive measures, mitigating the risk of accidents and ensuring the safety of personnel and the environment. For instance, digital twins can predict pipeline leaks or equipment failures, enabling timely repairs before catastrophic failures occur.

Environmental sustainability is another area where digital twins offer significant benefits. The ability to optimize operations and reduce energy consumption directly contributes to lower greenhouse gas emissions. Additionally, digital twins help in monitoring and managing environmental compliance by providing accurate data on emissions, effluents, and other environmental parameters. This data-driven approach supports regulatory compliance and promotes sustainable practices in the industry.

Challenges in implementing digital twins in oil and gas

Despite the numerous benefits, the implementation of digital twins in the oil and gas sector is not without challenges. One of the primary challenges is data integration and management. Digital twins rely on vast amounts of data from various sources, including sensors, control systems, and historical records. Integrating and managing this data in real-time requires robust IT infrastructure and advanced analytics capabilities. Moreover, ensuring the

DIGITAL TWINS

accuracy, consistency, and reliability of data is critical for the effectiveness of digital twins.

Another significant challenge is the complexity of creating and maintaining digital twins. Developing accurate and detailed virtual models of complex assets and processes requires specialised expertise and significant investment. The models need to be continuously updated with real-time data to reflect the current state of physical assets accurately. This dynamic nature of digital twins adds to the complexity and demands continuous monitoring and maintenance.

Cybersecurity is a growing concern with the increasing reliance on digital technologies in the oil and gas sector. Digital twins, being connected to critical infrastructure and operations, present potential targets for cyber-attacks. Ensuring the security and integrity of digital twins and the data they rely on is paramount. Implementing robust cybersecurity measures and protocols is essential to safeguard against potential

threats and vulnerabilities.

The adoption of digital twins also requires a cultural and organisational shift within companies. Traditional oil and gas operations have been primarily mechanical and manual, and the transition to digital and automated systems can face resistance. Training and upskilling the workforce to operate and maintain digital twins is crucial. Companies need to invest in developing digital competencies and fostering a culture of innovation and continuous improvement.

The cost of implementing digital twins is another challenge, particularly for smaller companies with limited resources. Developing and deploying digital twins involves significant upfront investment in technology, infrastructure, and expertise. While the long-term benefits are substantial, the initial cost can be a barrier to adoption for some companies. Demonstrating the return on investment and the value proposition of digital twins is essential to justify the expenditure.

Regulatory and compliance issues can also pose challenges to the implementation of digital twins. The oil and gas industry is highly regulated, and any new technology must comply with stringent standards and regulations. Ensuring that digital twins meet these regulatory requirements and obtaining the necessary approvals can be a complex and time-consuming process. Collaboration with regulatory bodies and standardization of digital twin technologies can help address these challenges.

A transformational technology

Digital twins represent a transformative technology for the oil and gas sector, offering significant benefits in terms of efficiency, safety, and sustainability. By providing real-time insights and predictive capabilities, digital twins enable optimized operations, enhanced asset management, and improved safety standards. However, the implementation of digital twins is not without challenges. Data integration and management, complexity, cybersecurity, organizational change, cost, and regulatory compliance are some of the key hurdles that need to be addressed. Overcoming these challenges requires a strategic approach, investment in technology and skills, and a commitment to innovation and continuous improvement. As the industry continues to evolve, digital twins will play an increasingly critical role in driving the future of oil and gas operations, ensuring they are more efficient, safe, and sustainable.

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Digital Transformation Brings New Cybersecurity Threats to the Oil and Gas Industry

As the oil and gas sector embraces digitalisation, it faces unprecedented cybersecurity risks that demand robust defensive strategies

The oil and gas sector has long been a cornerstone of the global economy, providing the energy needed to fuel industries, transportation, and homes. With the advent of digital technologies, this sector has undergone significant transformation. While digitalisation has brought about increased efficiency, operational safety, and data-driven decision-making, it has also introduced a new set of cybersecurity challenges.

The digital transformation of the oil and gas sector Digitalisation in the oil and gas sector encompasses a range of technologies, including

Industrial Internet of Things (IIoT), artificial intelligence (AI), machine learning, cloud computing, and big data analytics. These technologies enable enhanced monitoring, predictive maintenance, and optimisation of operations. For instance, IIoT devices collect real-time data from pipelines, refineries, and rigs, allowing for proactive maintenance and reducing downtime. AI and machine learning algorithms analyse vast amounts of data to optimize drilling operations and predict equipment failures.

Five cybersecurity risks in the digital era

1 - Increased attack surface

The integration of digital technologies into oil and gas operations has expanded the attack surface significantly. IIoT devices, sensors, and control systems are often interconnected, creating numerous entry points for cyber attackers. Each connected device or system is a potential vulnerability that can be exploited.

2 - Sophisticated cyber attacks

Cyber attackers have become more sophisticated, employing advanced tactics to breach systems. Ransomware, phishing, and spear-phishing attacks are increasingly common. In 2020, the ransomware attack on Colonial Pipeline highlighted the sector’s vulnerability, causing widespread disruption of fuel supply in the United States.

3 - Insider threats

Insider threats remain a significant concern in the oil and gas sector. Employees with access to sensitive data or critical systems can inadvertently or maliciously compromise security. The complex nature of operations and the involvement of multiple stakeholders, including contractors and third-party vendors, further complicates the management of insider threats.

4 - Legacy systems

Many oil and gas companies still rely on legacy systems that were not designed with cybersecurity in mind. These outdated systems may lack the necessary security features to defend against modern cyber threats. Integrating these legacy systems with new digital technologies can create security gaps.

5 - Supply chain vulnerabilities

The oil and gas sector relies heavily on a complex supply chain involving numerous third-party vendors and service providers. Each link in this chain presents a potential vulnerability. A breach in a vendor’s system can provide attackers with a pathway to

the primary target.

Case studies of cybersecurity incidents

Saudi Aramco

In 2012, Saudi Aramco, one of the world’s largest oil companies, suffered a devastating cyber-attack. The Shamoon virus wiped out data on approximately 30,000 computers, significantly disrupting operations. This attack highlighted the potential scale and impact of cyber threats on the oil and gas sector.

Colonial Pipeline

The ransomware attack on Colonial Pipeline in May 2021 underscored the vulnerabilities in critical infrastructure. The attack forced the company to shut down its operations, leading to fuel shortages and price spikes across the Eastern United States. The incident demonstrated how cyber-attacks on oil and gas infrastructure could have farreaching economic and societal impacts.

Six strategies to mitigate cybersecurity risks

1 - Implementing robust cybersecurity frameworks

Adopting comprehensive cybersecurity frameworks is crucial. Standards such as the NIST Cybersecurity Framework provide guidelines for managing and reducing cybersecurity risks. These frameworks offer a structured approach to identify, protect, detect, respond, and recover from cyber incidents.

2 - Enhancing employee training and awareness

Human error is often a significant factor in cybersecurity breaches. Regular training and awareness programs for employees can help mitigate this risk. Employees should be educated on identifying phishing attempts, using strong passwords, and adhering to security protocols.

3 - Upgrading legacy systems

Modernising legacy systems is essential to enhance security. This includes patching known vulnerabilities, integrating with modern security solutions, and, where feasible, replacing outdated systems with newer, more secure technologies.

4 - Strengthening supply chain security

Ensuring that third-party vendors and service providers adhere to stringent cybersecurity standards is critical. Conducting regular security audits, establishing clear cybersecurity requirements in contracts, and monitoring third-party access to critical systems can help mitigate supply chain risks.

5 - Implementing advanced security technologies

Leveraging advanced security technologies such as intrusion detection systems (IDS), intrusion prevention systems (IPS), and endpoint detection and response (EDR) can significantly enhance an organization’s security posture. These technologies can detect and mitigate threats in real time, reducing the potential impact of an attack.

6 - Cyber incident response planning

Having a well-defined incident response plan is vital for minimizing the impact of cyberattacks. This plan should outline the steps to

be taken in the event of a breach, including communication protocols, roles and responsibilities, and recovery procedures. Regularly testing and updating the incident response plan ensures its effectiveness.

The role of government and regulation

Governments and regulatory bodies play a crucial role in enhancing the cybersecurity posture of the oil and gas sector. Implementing and enforcing cybersecurity regulations can ensure that companies adhere to best practices. Initiatives such as the European Union’s Network and Information Systems (NIS) Directive and the U.S. Cybersecurity and Infrastructure Security Agency (CISA) guidelines provide frameworks for protecting critical infrastructure.

The future of cybersecurity in the oil and gas sector

As digitalization continues to advance, the oil and gas sector must remain vigilant and proactive in addressing cybersecurity threats. Emerging technologies such as blockchain could offer new solutions for securing data and transactions. Blockchain’s decentralized nature and cryptographic security can enhance the integrity and transparency of supply chain operations.

Artificial intelligence and machine learning will also play a significant role in cybersecurity. These technologies can analyse patterns and anomalies in vast amounts of data, enabling faster detection of potential threats and automated responses to mitigate them.

A myriad of risks

The digitalisation of the oil and gas sector has brought about significant benefits, but it has also introduced a myriad of cybersecurity risks. The increased attack surface, sophisticated cyber-attacks, insider threats, legacy systems, and supply chain vulnerabilities all pose significant challenges. However, by implementing robust cybersecurity frameworks, enhancing employee training, modernizing legacy systems, strengthening supply chain security, leveraging advanced security technologies, and having a well-defined incident response plan, the sector can mitigate these risks.

Government regulations and the adoption of emerging technologies such as blockchain and AI will further bolster the sector’s cybersecurity defences. As the oil and gas sector continues to evolve, a proactive and comprehensive approach to cybersecurity will be essential to safeguarding critical infrastructure and ensuring the continued delivery of energy to the global economy.

Future Conference

In collaboration with Shell

Exploring Open Collaboration, Innovation & Energy Transition

AMSTERDAM | ENERGY TRANSITION CAMPUS

7-8TH OCTOBER, 2024

Why the O&G Industry Needs a Digital Performance Model

Future Digital events create a vibrant space for collaboration, sharing and insights across industry, one where companies can collectively improve their understanding of how digital leads to a more effective, streamlined and value-generating industry. Find Kongsberg Digital at Future Oil and Gas Aberdeen.

At the recent Future Digital event in Houston, an interesting topic surfaced: defining the term ‘digital twin’. With more than 250 definitions, we are pleased to see that discussions are instead moving toward the value that digital twins bring and what elements are required for it to contribute to meaningful energy and digital transformation.

First things first: the data question

Let’s get the data question out of the way. While data remains a foundational ingredient for digital, companies are starting to see that a tactical large data approach is often long-winded, expensive and cost prohibitive. Bottom line, having more data does not lead to higher-quality decision-making but having the right data for decision-making does – especially since decision effectiveness drives 95 percent of company performance

What if the data is already in good shape?

That’s a good start. Maybe a good data architecture is already in place and it’s

possible to add digital applications on top to help users find, manage and apply data through visual interfaces like dashboards. But is that enough? What even progressive digitalised companies lack is the ability to identify opportunities where digital applications – like a digital twin – can connect data to real value.

A strategic digital performance model approach

By evolving to a strategic approach that organises data in a digital twin into explicit performance model frameworks, companies can drive transparency around decision making to link from desired outcomes – like profit and loss factors or throughput capacity – to data patterns that can be analysed to determine the right decisions, actions and subsequent work execution. This way, savings offer hard ROI directly related to profit and loss. When leveraging this performance model, companies can continuously incorporate the latest technologies like generative AI and large language models (LLMs) to fill gaps in the data foundation, address specific use cases and services and provide full traceability into the reasoning behind recommended actions.

What is the digital performance model?

Put simply, a collection of key organisational components that deliver faster, transparent, higher quality decisions and stronger business performance at scale. It ties together processes, organisational structures, technologies and governance in an industrial work surface – a digital twin environment built on physics-based and datadriven models – that provides a digital interface where work can be done.

Value drivers of a digital performance model

The key to driving success with a digital performance model is selecting the right digital services in the coordinating layer of the business where operational decision-making takes place. This layer lies between the top-down strategic management layer and the bottom-up tactical execution layer, and it is where focusing on low-

value, high-frequency events can bring both shortterm savings and long-term sustained, continuous improvement. By connecting these layers with digitally coordinated workflows, both business and operational goals are more transparent and achievable.

Some examples of low-value, high-frequency events in oil and gas:

Filter changes

Maintenance scheduling

• Changing between pumps during operation

Midstream metering

High-frequency events provide enough data to move from patterns to action and output, allowing for decision-making processes throughout the business to be digitalised and de-cluttered. The nature of being high frequency allows for faster automation and training of technologies like AI, ultimately freeing up decision-makers across the organisation to spend more time on key decisions and drive greater impact through the continuously optimised execution of business. When the low-value parts of a business are increasingly pushed towards autonomy and scaled, value drivers include asset support, cost savings and the condensation and automation of activity. Most importantly, a digital performance model approach accelerates faster high-quality decisions in real-time. Better throughput, less unplanned downtime and lower total cost of ownership –exactly what energy companies are after.

Three steps to success

Succeeding with the digital performance model requires three things: designing digitally, deploying optimally and delivering exponentially. First, designing digitally. This goes back to the initial stages of an operational digital twin where companies need to rethink how a digital thread will be embedded into operations – what are those high-frequency use cases and services that matter most? Then, deploying optimally. Making sure that the digital services in that coordination layer are grouped correctly according to resources or responses, and scalable enough that companies can push services towards autonomy across common asset classes. Finally, delivering exponentially by leveraging horizontal and vertical performance visibility for long-term returns on

asset. The transparency of execution is essential for companies to close the gaps on understanding what actions drive the desired results.

The circle of trust

An important part of embedding digital is the explainability of how decisions are made, especially with increased use of Artificial Intelligence. With a digital performance model that deliberately includes data lineage and transparency, users can get a full understanding of 1st principles (the hybrid Machine Learning parts of the digital twin) and instant, updated transparency into the reasoning engine used by AI to provide insights and recommended actions.

Digital ways of working for future generations

When looking at the digital performance model, results from real-world use cases show that it can elevate individual performance for key operational roles and act as an enabler for collective organisation-wide improvement. The expectation for everything to be digital, connected, immediate and trustworthy is possible only with a digital performance model that aligns with the speed and scale required for true energy transition.

A holistic end-to-end digital approach that focuses on highly repeatable quality improvements can increase decision quality, speed and collaboration, resulting in alignment with the industry’s ultimate desire to achieve scalable impact and streamline datasets across operators and suppliers.

How AI is Drilling Up Efficiency and Sustainability

As AI revolutionises the oil and gas industry, it promises unprecedented efficiency, safety, and environmental benefits while posing new ethical and operational challenges

The advent of artificial intelligence (AI) has revolutionised many sectors, and the oil and gas industry is no exception. The integration of AI into this sector promises significant benefits, including enhanced operational efficiency, improved safety, and reduced environmental impact. However, the implementation of AI must be approached responsibly to ensure ethical standards are maintained, risks are managed, and the benefits are maximised for all stakeholders involved.

One of the primary applications of AI in the oil and gas industry is predictive maintenance. By utilizing machine learning algorithms and vast amounts of data generated by sensors, companies can predict equipment failures before they occur. This predictive capability allows for timely maintenance, reducing downtime and operational costs while ensuring safety. For instance, AI can analyse vibration patterns, temperature fluctuations, and pressure variations to detect early signs of equipment deterioration. This

proactive approach not only extends the lifespan of machinery but also prevents accidents that could lead to catastrophic spills or explosions.

AI is also transforming the exploration and production phases of oil and gas operations. Traditionally, the search for new oil and gas reserves involves extensive geological surveys and exploratory drilling, which are both timeconsuming and costly. AI algorithms can process geological data much faster and more accurately than human analysts, identifying potential drilling sites with greater precision. This efficiency reduces the environmental footprint of exploration activities, as fewer unnecessary wells are drilled, and accelerates the time to bring new resources online.

In the realm of production optimisation, AI systems can continuously monitor and adjust the operations of oil rigs and refineries. By analysing real-time data, AI can optimise the performance of various processes, such as adjusting the flow rates of wells or refining temperatures, to maximise output while minimising waste. These optimisations not only improve profitability but also reduce the environmental impact of operations by enhancing energy efficiency and minimizing emissions.

Despite these benefits, the adoption of AI in the oil and gas industry must be approached with caution. One of the primary concerns is the ethical use of AI. As AI systems become more autonomous,

there is a risk of reducing human oversight, which can lead to unethical decision-making or unintended consequences. For example, an AI system might optimise production at the expense of environmental considerations, leading to increased pollution or habitat destruction. To mitigate these risks, companies must establish clear ethical guidelines for AI use, ensuring that AI systems are designed and operated in a manner that prioritises safety, environmental protection, and social responsibility.

Data privacy and security are also critical issues in the responsible use of AI. The oil and gas industry generates vast amounts of data, including sensitive information about reserves, operational processes, and personnel. Ensuring the security of this data is paramount to prevent industrial espionage, cyberattacks, and unauthorised access. AI systems must be equipped with robust cybersecurity measures to protect against these threats. Furthermore, companies must adhere to data privacy regulations, ensuring that data is collected, stored, and processed in a manner that respects the privacy rights of individuals and communities.

Another significant challenge is the potential impact of AI on the workforce. The automation of tasks traditionally performed by humans could lead to job displacement and economic disruption. To address this, companies must invest in retraining and upskilling their workforce, preparing them for new roles in an AI-driven industry. This approach not only supports the ethical use of AI but also fosters a more resilient and adaptable workforce, capable of leveraging AI technologies to their fullest potential.

Transparency and accountability are fundamental to the responsible use of AI. Companies must be transparent about how AI systems are used, the data they rely on, and the decision-making processes they support. This transparency builds trust among stakeholders, including employees, regulators, and the public. Moreover, companies must establish mechanisms for accountability, ensuring that there are clear lines of responsibility for the outcomes of AI-driven decisions. This

accountability can be achieved through regular audits, independent oversight, and the establishment of ethical review boards.

In addition to these internal measures, collaboration with external stakeholders is essential for the responsible use of AI in the oil and gas industry. Engaging with regulators, industry groups, and academic institutions can help companies stay abreast of emerging best practices and regulatory requirements. Collaboration can also foster innovation, as sharing knowledge and expertise across the industry can lead to the development of more effective and ethical AI solutions.

The role of AI in environmental sustainability cannot be overstated. The oil and gas industry is under increasing pressure to reduce its carbon footprint and mitigate its environmental impact. AI can play a pivotal role in achieving these goals by optimizing energy use, reducing emissions, and enhancing the efficiency of resource extraction and processing. For example, AI-driven systems can identify opportunities for energy savings in real-time, allowing companies to reduce their greenhouse gas emissions and improve their environmental performance.

The responsible use of AI in the oil and gas industry holds the potential to drive significant advancements in efficiency, safety, and sustainability. However, realizing this potential requires a commitment to ethical principles, robust data security, workforce development, transparency, and collaboration. By adhering to these principles, the oil and gas industry can harness the power of AI to not only enhance its operations but also contribute to a more sustainable and equitable future.

Satellite connectivity for upstream oil and gas –where are we, and what’s next?

Where are we? Moving from the era of increased connectivity to the age of AI

The oil and gas industry has already undergone a significant transformation through technological innovation, along with a requirement to support the growing demands of an increasingly energy-intensive modern world.

As industry has looked for new ways to drive efficiency and productivity to meet the needs of a global society that relies on access to power, electricity and transport 24 hours a day, 365 days a year, the need for reliable and secure connectivity has become more critical than ever, especially given the inherent need of industry to operate in remote and harsh natural environments, whether offshore or on land.

Traditionally, companies relied on terrestrial and cellular networks for their primary communications, supplemented by satellite for GPS augmentation and coverage in areas where terrestrial networks were unavailable. However, as the industry modernised and

technology developed the benefits of more robust and ubiquitous connectivity have become evident.

Already, satellite communications have revolutionised upstream oil and gas exploration and extraction as well as the entire supply chain from production to downstream distribution. Automation of heavy machinery, maintenance plans fuelled by real time data, and enhanced safety processes are just a few areas where satellite technology is making a significant impact.

Now, through the latest technology, when an automated machine is faced with a task it can’t process, instead of shutting down, resulting in significant periods of unproductive downtime, remote operators can reprogramme it, getting it back into operation in

minutes. It’s not only about productivity. Increasingly intelligent automation and always on connectivity means rising industry safety standards and healthier work environments for oil and gas professionals across the world. And, real time data is also enabling companies to minimise their carbon footprint through more efficient operations while enhanced productivity contributes to energy security at a time when geopolitical challenges and global security are once again in the spotlight.

Where are we going? Always on, everywhere, through multi-orbit

While technological innovation has already reshaped the industry, that is nothing compared to what we will see in decades to come. The innovations we have seen over the last twenty years – automation, real time data and advanced telematics – are game changing already. But through next generation multi-orbit satellite networks, we’ll see this progress super-charged with companies able to stay connected all the time, everywhere, and benefit from a much broader range of applications.

Leaders in industrial sectors that rely on heavy machinery and vehicles - like oil and gas - already recognise the need for enhanced connectivity, understanding that this will drive productivity, efficiency and safety. According to recent data, 78% of executives surveyed expressed a willingness to pay a premium for access to consistent and reliable connectivity to support their operations. But, at the same time, 41% of business leaders identify that meeting rapidly rising bandwidth requirements are among their top needs with regards to connectivity solutions and almost two thirds state that unlocking remote connectivity is their main motivator for adopting new satellite connectivity solutions. Enter next generation multi-orbit networks.

For readers who are new to satellites, let me explain the fundamentals. There are a

range of satellites above the earth in different constellations, with very different orbital patterns and elevations. Geostationary satellites (GEO) have the highest orbits, at approx. 36,000 km above the earth’s surface at a fixed position over the equator. The fixed position of GEO along with its high orbit means these satellites are well suited to analysing long term trends like weather patterns, Medium Earth Orbit (MEO) satellites, at around 8,000 km, deliver higher throughput and lower latency, making them suitable for applications like remote vehicle control and real-time video streaming. Finally, LEO satellites, positioned just a few hundred kilometres above Earth, provide ultra-low latency and can operate in constellations on much more flexible orbits, ensuring connectivity even in the most remote locations – the north and south poles, for example.

Combining signals from a multi-orbit network gives companies the best of all worlds, enabling them to dynamically switch between orbits depending on real time requirements, unlocking a broader range of connectivity applications, reducing latency, and crucially increasing bandwidth for businesses operating in an environment where their requirement for data is only going to increase.

At the same time, our ability to provide mobile connectivity solutions embedded into heavy equipment is drastically improving. By integrating satellite antenna tech seamlessly directly into trucks, heavy machinery can consistently access signal on the move.

The applications of such networks combined with next generation mobile hardware on land are vast. They can ensure real time machine performance data is provided no matter how remote the environment, allowing operators to optimise predictive maintenance. That doesn’t just prevent down time, it stops small defects becoming larger, more expensive and time-consuming issues that more dramatically impact productivity.

At the same time, the flexibility of multi-orbit means that oil and gas companies can far more effectively leverage applications like live video to gain situational awareness and see what’s happening around equipment in the field.

And, always on connectivity means greater capacity for automation. As technology advances, we are faced with the exciting prospect of new drilling, excavation and maintenance equipment that can be remotely reprogrammed in real-time and implement machine learning solutions to become increasingly intelligent, learning on the job.

Finally, as we have seen with other technologies, we are finding new ways to apply hardware so it is increasingly portable and ruggedised so that it can be used by individual workers and machines on the move in harsh environments. That ranges from robust and reliable antenna on vehicles to satellite hubs condensed into backpacks for workers in the field.

The future of oil and gas undoubtedly lies in greater adoption of technological solutions to drive efficiency and productivity in a world where our need for energy and natural resources are increasing exponentially. Meeting our global societal need for energy security is only possible if it is underpinned by greater connectivity. That provides an exciting foundation for innovation, enabling the industry to meet the demands of the modern world.

Industrial Metaverse Transforming Oil and Gas Industry

The industrial metaverse revolutionises the oil and gas sector by enhancing operational efficiency, safety, and sustainability through advanced digital technologies

The concept of the metaverse has predominantly been associated with virtual reality environments aimed at social interaction and entertainment. However, an intriguing and transformative branch is emerging known as the industrial metaverse. This digital universe is poised to revolutionise various sectors, including the oil and gas industry, by integrating advanced technologies such as artificial intelligence (AI), Internet of Things (IoT), and digital twins.

Defining the industrial metaverse

The industrial metaverse represents a convergence of physical and digital worlds, creating immersive and interactive environments that enable real-time data sharing, simulation, and collaboration. Unlike the consumer-oriented metaverse, which focuses on social experiences and gaming, the industrial metaverse is tailored to address the needs of industries by enhancing operational efficiencies, safety, and decision-making processes. It leverages technologies like AI, IoT, augmented reality (AR), and virtual reality (VR) to create comprehensive digital replicas of physical assets, known as digital twins.

Digital twins and real-time data

In the oil and gas industry, digital twins play a pivotal role within the industrial metaverse. A digital twin is a virtual replica of a physical asset, process, or system, continuously updated with real-time data. For instance, an offshore drilling rig can have its digital twin that mirrors its every operation, from machinery status to environmental conditions. This allows engineers and managers to monitor, analyse, and optimise performance remotely.

Real-time data integration is crucial for effective decision-making in the oil and gas sector. The industrial metaverse enables the collection and analysis of vast amounts of data from sensors and IoT devices embedded in equipment and infrastructure. By analysing this data in a virtual environment, companies can predict maintenance needs, identify potential issues before they escalate, and optimise production processes. This predictive maintenance approach reduces downtime, extends the lifespan of assets, and ultimately lowers operational costs.

Enhanced collaboration and training

One of the significant advantages of the industrial metaverse is the ability to facilitate

enhanced collaboration and training. In the oil and gas industry, where operations are often spread across remote and hazardous locations, this capability is invaluable. Through VR and AR technologies, teams can collaborate in virtual environments that replicate real-world conditions. Engineers and technicians can conduct virtual inspections, troubleshoot problems, and even perform complex procedures without being physically present at the site.

Additionally, training programs in the industrial metaverse can simulate real-world scenarios, providing hands-on experience without the risks associated with on-site training. New employees can familiarise themselves with equipment and procedures in a safe and controlled virtual environment. This not only accelerates the learning curve but also ensures that personnel are better prepared for real-world challenges.

Safety and risk management

Safety is a paramount concern in the oil and gas industry, where accidents can have catastrophic consequences. The industrial metaverse offers innovative solutions to enhance safety and risk management. By creating accurate digital twins and leveraging real-time data, companies can simulate and analyse potential hazards and emergency scenarios in a virtual environment. This allows for thorough testing of safety protocols and the identification of weaknesses without exposing personnel to actual danger.

For example, in the event of a potential leak or equipment failure, the industrial metaverse can simulate the incident and provide detailed insights into its possible progression. This enables companies to develop more effective emergency response plans, conduct virtual drills, and ensure that all personnel are adequately

trained to handle such situations. Additionally, continuous monitoring through IoT devices and AI analytics can predict unsafe conditions and automatically trigger preventive measures.

Operational efficiency and cost savings

The oil and gas industry is characterised by high operational costs and complex supply chains. The industrial metaverse can significantly enhance operational efficiency and drive cost savings through several mechanisms. Firstly, real-time monitoring and predictive maintenance reduce unplanned downtime, optimise equipment usage, and minimise repair costs. By anticipating maintenance needs and addressing issues proactively, companies can extend the life of their assets and avoid costly disruptions.

Secondly, the ability to simulate various operational scenarios in the industrial metaverse allows for better planning and optimisation of processes. Companies can experiment with different strategies and configurations in a virtual environment, identifying the most efficient and cost-effective approaches before implementing them in the real world. This leads to improved resource allocation, streamlined workflows, and enhanced productivity. Environmental sustainability

The industrial metaverse also contributes to environmental sustainability in the oil and gas industry. By optimising operations and reducing inefficiencies, companies can minimise their carbon footprint and energy consumption. Real-time data analysis and predictive maintenance help to ensure that equipment operates at peak efficiency, reducing emissions and waste.

Moreover, digital twins and virtual simulations enable companies to explore and implement greener technologies and practices. For instance, they can model the impact of integrating renewable energy sources, optimising energy use, and reducing flaring and venting of gases. These efforts align with global sustainability goals and help the industry transition towards a more environmentally responsible future.

Challenges and future outlook

While the industrial metaverse holds immense potential, its implementation in the oil and gas industry is not without challenges. The integration of advanced technologies requires

significant investment in infrastructure, training, and cybersecurity measures. Ensuring data accuracy and reliability is crucial, as inaccurate data can lead to erroneous decisions and compromised safety.

Furthermore, the adoption of the industrial metaverse necessitates a cultural shift within organisations. Employees must embrace digital transformation and be willing to adapt to new ways of working. This requires comprehensive training programs and a commitment to fostering a culture of innovation and continuous improvement.

Despite these challenges, the future outlook for the industrial metaverse in the oil and gas industry is promising. As technology continues to advance and become more accessible, the barriers to adoption will diminish. Companies that successfully integrate the industrial metaverse into their operations stand to gain a competitive edge through enhanced efficiency, safety, and sustainability.

A transformative shift

The industrial metaverse represents a transformative shift in how the oil and gas industry operates. By harnessing the power of digital twins, real-time data, and immersive technologies, companies can achieve unprecedented levels of operational efficiency, safety, and collaboration. The industrial metaverse enables predictive maintenance, enhances training programs, improves safety protocols, and drives environmental sustainability. While challenges exist, the potential benefits far outweigh the obstacles, making the industrial metaverse a crucial component of the future oil and gas industry. As the sector continues to evolve, embracing the industrial metaverse will be key to unlocking new opportunities and navigating the complexities of the modern energy landscape.

Global Call for Carbon Capture Technology by Oil and Gas Industry

Oil and gas operators must urgently develop and deploy Carbon Capture, Utilization, and Storage (CCUS) technologies to significantly reduce greenhouse gas emissions and combat climate change

The necessity for Carbon Capture, Utilisation, and Storage (CCUS) technologies to be developed and deployed by oil and gas operators has become increasingly apparent in recent years. The global consensus on the urgency of addressing climate change underscores the

critical role that these technologies must play. CCUS represents one of the most viable pathways to reducing greenhouse gas emissions from fossil fuel sources, thereby contributing significantly to the global effort to achieve net-zero emissions by mid-century.

The oil and gas industry is a major contributor to global carbon dioxide (CO2) emissions, which is a principal driver of climate change. This industry not only produces and refines fossil fuels but also releases significant amounts of CO2 during various stages of its operations. As the world continues to grapple with the devastating impacts of climate change, there is a growing imperative for this sector to transition towards more sustainable practices. CCUS technologies offer a practical and effective means of achieving substantial emission reductions while still meeting the world’s energy demands.

CCUS involves three primary processes: capturing CO2 emissions at their source, transporting the captured CO2 to a storage site, and securely storing it underground. This technology can be applied across various sectors, but it is particularly pertinent to the oil and gas industry. By integrating CCUS into their operations, oil and gas companies can capture CO2 from sources such as power plants, refineries, and chemical plants. This captured CO2 can then be transported via pipelines to geological formations such as depleted oil and gas fields or

deep saline aquifers, where it can be stored permanently.

The deployment of CCUS technology presents a myriad of benefits. Firstly, it significantly reduces the carbon footprint of fossil fuel production and consumption. This is particularly crucial as the world continues to rely on fossil fuels for a considerable portion of its energy needs. By capturing and storing CO2 emissions, CCUS can help mitigate the environmental impact of these fuels, thereby enabling a more sustainable energy transition. Furthermore, CCUS can be integrated with enhanced oil recovery (EOR) techniques, wherein the injected CO2 helps to extract additional oil from existing reservoirs. This not only boosts oil production but also offsets some of the costs associated with CCUS deployment, making it a more economically attractive option for oil and gas operators.

Moreover, CCUS can play a pivotal role in the decarbonization of hard-to-abate industrial sectors. Industries such as cement, steel, and chemicals are inherently carbon-intensive, and reducing their emissions is a significant challenge. By capturing CO2 emissions from these sectors, CCUS can contribute to a broader strategy for achieving net-zero emissions. This is especially important given that these industries are essential to the global economy and are unlikely to be completely phased out in the near future.

Another critical advantage of CCUS is its potential to generate new economic opportunities. The development and deployment of CCUS technologies require significant investment, research, and innovation. This can stimulate job creation and economic growth in regions where the oil and gas industry operates. Additionally, the infrastructure required for CCUS, such as pipelines and storage facilities, represents a substantial capital investment, further driving economic activity.

Despite these advantages, the widespread adoption of CCUS faces several challenges. One of the primary barriers is the high cost associated with capturing and storing CO2. Developing and deploying

CCUS technology requires significant upfront investment, and the current market conditions may not always favour such expenditures. However, with appropriate policy frameworks and incentives, governments can help mitigate these costs and encourage investment in CCUS. For instance, carbon pricing mechanisms, tax credits, and subsidies can make CCUS more economically viable for oil and gas operators.

Furthermore, the regulatory and legal frameworks surrounding CCUS need to be robust and clearly defined. This includes ensuring the safety and security of CO2 storage sites to prevent leaks and environmental contamination. Regulatory certainty is essential to build public confidence and attract investment in CCUS projects. Governments and industry stakeholders must work collaboratively to develop comprehensive regulations that address these concerns while facilitating the deployment of CCUS technologies.

Public perception and acceptance of CCUS also play a crucial role in its deployment. There is a need for increased awareness and understanding of the benefits of CCUS among the general public and policymakers. Effective communication strategies can help address misconceptions and highlight the role of CCUS in achieving climate goals. Building public trust through transparency and demonstrating the safety and efficacy of CCUS projects are essential steps in gaining broader acceptance.

In conclusion, the development and deployment of CCUS technologies by oil and gas operators are imperative for achieving significant reductions in global CO2 emissions. CCUS offers a practical solution to the dual challenge of meeting the world’s energy needs while addressing climate change. By integrating CCUS into their operations, oil and gas companies can significantly reduce their carbon footprint, contribute to the decarbonization of industrial sectors, and unlock new economic opportunities. However, overcoming the challenges associated with CCUS deployment requires concerted efforts from governments, industry stakeholders, and the public. With the right policy frameworks, regulatory measures, and public support, CCUS can become a cornerstone of a sustainable energy future.

CARBON CAPTURE AND STORAGE

The Future of Oil and Gas: Navigating a Transformative Landscape

As Mark Venables explains the oil and gas industry faces technological advancements, environmental challenges, and shifting economic dynamics, it must adapt to stay relevant and sustainable.

The oil and gas industry has been the backbone of global energy production for over a century, fuelling industrial growth, transportation, and domestic needs. However, the future of oil and gas is undergoing a profound transformation driven by technological advancements, environmental concerns, and shifting economic dynamics. As the world grapples with the dual challenges of meeting growing energy demands and combating climate change, the oil and gas sector must adapt to stay relevant and sustainable.

Technological innovation is a critical factor shaping the future of oil and gas. Advanced drilling techniques, such as hydraulic fracturing and horizontal drilling, have unlocked vast reserves of unconventional oil and gas, particularly in the United States. These technologies have led to a resurgence in domestic production, reducing reliance on imports and reshaping global energy markets.

Moreover, digital technologies, including artificial intelligence (AI), machine learning, and the Internet of Things (IoT), are revolutionizing the industry. These tools enable more efficient exploration, production, and maintenance processes, reducing costs and minimizing environmental impact. Predictive maintenance, for example, can foresee equipment failures before they occur, enhancing safety and reducing downtime.

Environmental concerns are exerting immense pressure on the oil and gas industry. The Paris Agreement and increasing global awareness of climate change have catalysed a shift towards cleaner energy sources. Governments and regulatory bodies worldwide are implementing stricter emissions standards and promoting renewable energy adoption. In response, many oil and gas companies are diversifying their portfolios to include renewable energy projects, such as wind, solar, and biofuels.

Carbon capture and storage (CCS) technologies are also gaining traction as a means to mitigate the environmental impact of fossil fuel consumption. By capturing carbon dioxide emissions from industrial processes and storing them underground, CCS can play a pivotal role in reducing greenhouse gas emissions while allowing continued use of fossil fuels during the transition to a low-carbon economy.

The economic landscape of oil and gas is becoming increasingly complex. Volatile oil prices, influenced by geopolitical tensions, supply-demand imbalances, and economic cycles, pose significant challenges for the industry. Companies must navigate these fluctuations while managing capital expenditures and ensuring long-term profitability.

The rise of electric vehicles (EVs) and advancements in battery technology are also reshaping the demand for oil. As EV adoption accelerates, the demand for gasoline and diesel is expected to decline, prompting oil companies to explore new markets and business models. For instance, some companies

are investing in EV charging infrastructure and exploring opportunities in the hydrogen economy.

The transition to renewable energy is a central theme in the future of oil and gas. While fossil fuels will likely remain a significant energy source for decades, the shift towards renewables is inevitable. Many oil and gas giants are rebranding themselves as “energy companies” and setting ambitious targets to reduce carbon emissions and invest in clean energy.

Renewable energy projects, such as offshore wind farms and solar power plants, are becoming integral to the strategies of traditional oil and gas companies. By leveraging their expertise in large-scale energy projects and infrastructure, these companies can play a crucial role in the global energy transition.

The future of oil and gas is at a crossroads, marked by transformative changes and unprecedented challenges. Technological advancements, environmental imperatives, and evolving market dynamics are driving the industry towards a more sustainable and diversified energy future. As oil and gas companies navigate this complex landscape, their ability to innovate, adapt, and embrace new energy paradigms will determine their longterm success and relevance in a rapidly changing world. While the road ahead is uncertain, the industry’s commitment to transformation and sustainability offers a promising pathway to a cleaner, more resilient energy future.