Digital transformation of the oil, gas and energy value chain

Abstract

This paper looks back at 2014–2017 as a period of extraordinary transition of the international and Australian oil and gas industry, with mounting evidence that the industry and broader energy value chain is entering an era of unprecedented digital transformation. This process is expected to accelerate through 2018–2025, with profound implications for industry stakeholders. The key question is: are organisations and the industry more broadly doing enough, well enough, fast enough? Emerging from the lows of a pronounced industry recession, and subsequent and ongoing consolidation, there is now growing, broad-based acceptance that the industry needs to engage new business models that leverage modern digital technology to reform productivity and broader industry performance. However, the harsh reality is that other industries are delivering superior results, faster, which is driving a need for an elevated and sustainable strategic response. This paper seeks to illustrate the digital links that must be established along the full value chain between data access and management, predictive analytics, visualisation, team collaboration and communication technology. The digital links are enabled by internet connectivity and cloud-based infrastructure, which presents an opportunity for organisations of all sizes to realise benefits along the complete chain. This paper is structured in four parts: • The strategic context – what is driving the need to engage in digital transformation? • The digital transformation value proposition – what value can be achieved? • Case studies – what are examples of digital transformation? • Key learnings – what should we note from thousands of global digital initiatives underway along the energy oil, gas and energy value chain? The main takeaways from this study are: • There is an unprecedented opportunity to transform the oil and gas value chain to deliver new growth and improved productivity, linking real-time data, predictive analytics, interactive visualisation and collaboration. • Digital transformation is affordable, readily implemented and scalable to meet current and changing future needs. • There are many powerful examples of material value add across exploration, development, operations and business management. • Many organisations and the industry as a whole is lagging others – the industry is not doing enough, well enough, fast enough. • The time to act/accelerate is now. • Digital transformation is not about technology alone. Keys to success include vision, leadership, culture and data quality.