SUSTAINABILITY
Journey to a more sustainable future How can digitalisation and the digital twin help the oil and gas industry?
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espite attention largely turning to green and sustainable forms of energy to help benefit the planet, BP’s Energy Outlook 2020 states that oil and gas will continue to remain the primary source until 2035. However, the sector now faces a number of significant challenges, from meeting carbon goals associated with the production of energy at lower costs to making drastic reductions in carbon emissions in the wake of net zero targets. Alongside this, oil and gas exploration targets are now becoming increasingly difficult to achieve. “It’s a set of challenges that are creating growing concerns among oil and gas companies in terms of their future relevance,” Stuart Querns, Director for Enterprise Asset Management (EAM), Delaware says. “This is why it is becoming critical to explore methods that help boost production, save costs, and reduce carbon emissions during a period of unprecedented scrutiny to be more sustainable.”
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Sustainability in the sector In the face of increasing focus on renewables, the oil and gas industry rebounded strongly throughout the course of 2021, with oil prices also reaching their highest levels in six years. In its findings, Deloitte also discovered that many oil and gas companies are focussing on reinventing their operations by analysing financial health, practicing capital discipline, transforming their business models, and making clear commitments to battling climate change. “This is opening up two areas of focus where a critical balance needs to be struck,” Querns continues. “As is the case of most businesses, ensuring profitability is still king for many of these companies in the sector and will remain so. In the third quarter of 2021 alone, 24 top oil and gas companies made more than $74bn in net income. From January to September of last year, the combined profits of Exxon, Chevron, Shell and BP was $174bn alone. “Despite strong figures, these numbers aren’t detracting from the growing drive among oil and gas businesses to become more sustainable. Much of the cause of this is both from investors prioritising firms with strong ESG credentials and the trend for customers to seek
