Disruptive technologies are set to accelerate the transformation of the oil and gas sector in the Gulf during the lower price era, according to 77% of respondents to a Gulf Intelligence Industry Survey of 250 energy professionals operating in the Middle East.
Technological innovations have the power to trigger dramatic improvements to companies’ operational productivity and economic efficiency in less than a decade – a blink of an eye in economic terms. A disruptive technology is a tool that has the capability to replace an established technology, such as digitized data sets replacing the use of PDFs at oil fields.
Big data analytics (26%), automation and robotics (23%) and enhanced oil recovery (23%) will emerge as game changing technologies in the energy sector in the Gulf and beyond over the next two decades, according to the GI Industry Survey. Fewer respondents (9%) said nanotechnology will spearhead the energy sector’s transformation, with 19% saying that all aforementioned technologies will be made redundant by even newer technologies that humans have yet to create.
An elongated wave of higher energy prices, especially oil, before June 2014 stalled the development much-needed technological innovations aimed at curbing costs and boosting operational efficiency. Now, with oil prices hovering at a 12-year low around $30/bl, energy companies’ stressed budgets and rising energy demand must herald an era of cutting-edge technologies.
Crossover technologies also fall under the umbrella of disruptive technologies, acting as a shortcut to costly and time-consuming research and development (R&D) that seek to create innovations from scratch. A single technology holds potential for many industries. Automated image analysis that is used by security forces for facial recognition and by doctors for digital pathology could be used to determine drill bit damage in the oil and gas sector.
So far in the GCC, Oman has embraced enhanced oil recovery technologies as it faces challenging and ageing oil fields, while Saudi Arabia, Qatar and the UAE are also making inroads in EOR, automation, robotics and 3D imagery. International oil companies are becoming more eager to use remote-controlled aerial drones with high-resolution cameras to monitor offshore oil rigs, which means human resources can be used for less dangerous roles.
Still, over half (57%) of respondents said international and national oil companies do not need to open innovation centers in innovation hubs, like the US’ Silicon Valley, to tap into the best information and communications technologies. Instead, Gulf countries’ private and public sector must be encouraged to nurture a local culture of innovation to help boost economic and operational efficiency.
Meanwhile, oil prices continue to hover around $30/bl, putting considerable fiscal pressure on energy companies and governments and triggering redundancies worldwide. Half (51%) of respondents to the GI Industry Survey said oil prices are unlikely to rise above an average of $40/bl this year, while nearly a third of respondents (28%) cited $30/bl.