Renewable Energy

Digitalization of the Oil and Gas Industry is deemed both Boon and Bane

Digitalization has taken over across the industrial sphere. Connectivity has shown the potential to empower millions of people while offering businesses with unique opportunities for value creation. Since the industrial transformation, the Oil and Gas industry has played an instrumental role in the strengthening of a country’s economy. One of the crucial commodity – Oil and Gas – is no exception when it comes to the digitalization of industries.


Digitalization of Oil and Gas

The digital concepts, including big data and the internet of things, is not new to the Oil and Gas industry. Digitalization of the oil and gas industry dated back to the early 80s when major industry players such as Saudi Aramco, Royal Dutch Shell, Total started using digital technologies for their operations. Compared to other industries, digital transformation is anticipated to be evolutionary than revolutionary. Advancements in technologies, including big data, analytics, and cloud computing, have brought forth the immense potential for the industry. Cloud computing helps improve business liveliness by breaking down corporate activities. Using big data and analytics, Oil and Gas businesses can analyze quantities of structures as well as unstructured data and decide on future ventures and mobile technologies that enable new business scenarios.
The combined impact of these technologies can augment the business capabilities beyond the imagined limits.

Technologies used for Digitalization of the Oil and Gas Industry

Big Data Analytics
Big Data Analytics

Big Data and Analytics

Cheap sensors and higher computing capacities are pushing the rise in data obtained by Oil and Gas companies. Offshore drilling platforms have more than 90,000 sensors, which generate nearly 15 terabytes of data during an asset’s lifespan. Big data and analytics are helping companies effectively use this massive amount of data available to them.
Today, over 50% of Oil and Gas companies are investing in Big data and analytics. However, merely 20% of them make use of the available data correctly. A full-scale deployment of this technology will have a far-reaching impact on operations and productivity.

Industrial Internet of Things
Industrial Internet of Things

Industrial Internet of things (IIoT)

Industrial Internet of Thing is an application of IoT, which is a mesh of interrelated computer systems. The IIOT has broken down the barriers between operational technology (OT) and information technology (IT) – meaning unstructured machine-generated data can be studied for insights that push improvements in operations and execution. IIot also enables a machine to machine communication remotely. For Oil and Gas companies, IIoT can help with optimization by offering new operational insights of operational data such as drilling parameters and cross-disciplinary data such as geological models. Downstream companies see potential in new revenue opportunities, from improving visibility of the hydrocarbon supply chain using IIoT.

Mobile Devices
Mobile Devices

Mobile Devices

Oil and Gas companies invest systematically in fully integrating mobile devices into day-to-day activities. The key benefits of this integration include workflow improvements from better group communication, worker productivity, and recording of field data. Oil and Gas companies have improved employee safety through smartphones GPS to track workers in danger.

Why Digitalization of the Oil and Gas Industry?

As the World Economic Forum has suggested that the Internet revolution that reformed business-to-consumer industries would dramatically alter industries such as energy, manufacturing, and transportation, the Oil and Gas industry is seen adopting the developments. In recent years, the focus on innovation has given rise to game-changing production technologies that unlocked the oilsands and tight oil and shale gas reserves using horizontal drilling and multistage fracturing. Digitalization of oil production technology is abetted by high prices, and the subsequent plummeting of price after technologies helped create a market supply glut. The digitalization of the Oil and Gas industry helped understand a reservoir’s resource and production capacity, improving the health and safety of employees, and boosting marginal operational efficiencies in oil fields around the world.

Digitalization a threat to Oil and Gas


Digitalization is often viewed in terms of the operational benefits it delivers Lower cost barrels and improved safety. However, for the upstream supply chain, many of the ideas and new operating models disturb their current business. For an industry that is still facing the impact of the worst downturn in a generation, digitalization is an opportunity as well as a treat.
The possible impact of cyberattacks on facilities and the national grids has been making headlines. However, the Oil and Gas companies are also vulnerable to potential cyber threats, whether carried out by hostile governments, militant groups, or private citizens intending to make political statements. Malware and phishing are two usual types of cyber threats that have targeted digital oil.

Malware consists of viruses and several wicked software programs that target IT data assets. The Energetic Bear Virus was launched by a Russian hacking group and attacked oil, gas. Power and energy investment companies. Before its discovery by a cybersecurity agency, the virus enabled the hackers to track energy consumption in real-time and jeopardize physical systems.

Phishing is a social engineering that uses deception and manipulation to attack data systems. Spear phishing uses emails to victimize employees and steal data.

It is necessary that the Oil and Gas companies develop the required capabilities to safeguard against cyberattacks. The industry must also see to implement wide-ranging information sharing and threat intelligence initiatives to maximize knowledge about advanced persistent threats and related solutions.

Future of Digitalization of Oil and Gas Industry

Today the global digitalization of Oil and Gas industry is at $24.1 billion. Out market specialists estimate the global market to be more than $30 billion, at a compound annual growth rate of 4.77%. Increase requirement of oil and gas for many purposes is driving the market to grow exponentially. However, decarbonisation and declining deposition of oil is clouding the growth.

Major Oil Companies

  •  Schlumberger (US)
  • Weatherford (Switzerland)
  •  Halliburton (US)
  •  BHGE (US)
  •  National Oilwell Varco (US)

Key Equipment providers

  • ABB (Switzerland)
  •  Emerson (US)
  • Rockwell (US)
  •  Siemens (Germany)


1. What is digital oil field?

Digital oil field is a concept that combines oil field operations with digital technologies to automate workflows for improving productivity, decreasing cost of production and minimizing overall risks associated with oil and gas business operations.

2. What technologies are applied for digitalization of the Oil and Gas industry?

Digital technologies such as Industrial Internet of things (IIoT), cloud computing, big data and analytics, GPS sensors, and Mobile devices are utilized for several operations, including collecting and analysing data, communications, production, oil drilling, health and safety etc.

3. What gave rise to digitalization of the Oil and Gas industry?

Technological advancements have widespread across all the industries. Oil and gas have various uses across domains. Along with advancements in technological world, current trade battles, dipping oil prices, decarbonisation steps among others are main reasons of digitalization of the Oil and Gas industry.


Lacey Thomas

Lacey is the chief contributing author for the renewable energy column. She is a student of environmental science has acquired quite a lot of knowledge about energy resources. She has written many research papers based on renewable energy sources. She in her articles always tries to show people the positive aspects of using renewable energies.

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