Thanks to the rise in applications of advanced analytics, the oil & gas industry has seen tremendous growth in recent years. Various business dynamics in the oil & gas industry such as Increased reliance on advanced analytics, ongoing exploration of new fields, escalating drilling and production activities, and shift in focus from conventional to unconventional gas resources are characterised with digitalization, todayl.
Moreover, diminishing the impact of changing regulations and building growth strategies to tackle uncertainty are factors that are further influencing the oil & gas industry’s growth. Nevertheless, oil & gas companies are resorting to advanced data analytics to combat these challenges in the coming future. As a result, the oil & gas industry, with a year-on-year growth of 16.2% in revenue generation, emerged as the top sector in Forbes 2019 list in terms of revenue growth rates.
The oil & gas industry has undergone a massive transformation in recent years with the advent of advanced analytics. On the other hand, companies have also had to face certain challenges like changing regulations that have hindered the growth of the oil & gas landscape.
A combined effort of capitalising on the growth drivers while finding solutions to work through the growth inhibitors is becoming possible for the oil & gas industry, mainly due to the recent advancements in business intelligence technologies including data analytics and Artificial Intelligence (AI).
This article explains how the oil & gas industry is likely to deal with various business dynamics with the help of advanced analytics.
Advanced Analytics Uncover Opportunities to Bolster Exploration and Production Activities
The world is continually triggering the demand for energy, despite the recent decline in socioeconomic growth of the world, and this has been influencing growth of the global oil & gas market. By 2050, the global consumption of energy is expected to increase by 50%, according to a recent report of the U.S. Energy Information Administration. As a result, the exploration of new fields has become one of the main objectives for oil & gas companies today.
This has led to a rise in the number of exploration activities carried out by oil & gas companies and is certainly adding to the large chunks of data generated daily. Implementing advanced analytics could be the perfect strategy to efficiently manage and assess this data.
With the rise of digitalization in the oil & gas industry, reliance on technology has grown immensely, with the ultimate motive of efficiently managing massive archives of data and improving its business processes. The adoption of advanced analytics tools is emerging as the prime solution for the oil & gas industry in devising data-driven strategies and also, in increasing the productivity in drilling, exploration, production activities.
Changing Regulations are Triggering Need for Advanced Analytics for Better Decision Making
Keeping up with the changing regulations is one of the major restraints in the growth of the oil & gas industry, today.
Among the various other challenges that oil & gas enterprises are facing today, complying to ever-changing regulations and boosting energy transition are pushing them to become digitally smarter than ever. Leading oil & gas companies are adopting advanced analytics to comply with various regulations that are primarily associated with the safe logistics of petroleum products and with ensuring environmental safety.
As these regulations differ with geographies, it becomes quite difficult for oil & gas companies to keep up with them and it ultimately affects their operations and productivity. However, many companies across the globe have now started implementing business intelligence technologies and advanced analytics to cut their carbon footprint and optimize their decision making processes.
Analytics features like carbon capture and storage technology are also being adopted to reduce emissions which are helping companies to align their strategies in line with the environmental regulations.
Connecting the Dots in Supply Chain Efficiency with Advanced Analytics
Gaining intelligent business insights and finding gaps in the operations are the predominant areas where advanced analytics are helping oil & gas companies to dig out new opportunities for growth.
The massive datasets generated are assessed and analyzed to optimize drilling, exploration and production processes, and enhance overall productivity. Thus, the adoption of advanced analytics has resulted in improving both the frequency and efficiency of operations, which has strongly assisted in the industry’s market growth.
Another major trend seen in the oil & gas industry is the preference for building growth strategies on shifting sands. Factors such as indeterminate fluctuations in commodity prices, ambiguity regarding the future of fossil fuels, worsening trade negotiations around the world, etc are constantly hosting new challenges for the oil & gas industry.
At such times, it is essential to create strategies based on your strengths while also focusing on new growth areas with the adoption of advanced data analytics and business intelligence technologies. This is how the oil & gas industry is likely to eliminate the problem of unpredictable nature by planning strategies that help in adapting to changes and assist in enhancing existing capabilities.
Advanced Data Analytics can Offer Real-Time Tracking of Operations
Attaining a real-time awareness of business operations is one of the major opportunities that can help boost growth for oil & gas companies. The power of keeping a real-time track of operations can be achieved by performing advanced analytics in a more efficient manner. Leading players are also leveraging advanced analytics tools to get instant insights that can be acted upon for managing operations throughout the supply chain.
Furthermore, real-time decision making would also help in cutting down on costs and save a lot of time. Adoption of advanced analytics can also be seen directed towards speeding up logistics and operations while also enhancing the management of assets for oil & gas enterprises.
Thus, by attaining real-time awareness with data analytics and business intelligence tools, the oil & gas industry can easily reduce the cost of operations and asset downtimes, and accelerate workflows, which would ultimately result in astounding growth of the industry.
Future of Oil & Gas Industry Looks Promising with Advanced Analytics
While the need for empowering the oil & gas industry with renewable energy sources has been ever-increasing, it is also true that life without oil today is almost impossible. However, with the industry transitioning towards a digitally operated landscape, business intelligence and advanced analytics are soon likely to emerge as the new workhorses for the oil & gas industry in the coming years.