How AI will create the digital oilfields of the future in the GCC

The oil industry will require to invest about $11 trillion over the next 20 years to meet the demand for crude worldwide, according to the latest annual outlook issued by the OPEC [Organisation of Petroleum Exporting Countries] this week.

“While investments picked up slightly in 2017 compared to the previous two years, and the expectations are for higher levels again in 2018, it is vital that as an industry we ensure there is timely and adequate investment so as not to lead to a supply shortage in the future,” OPEC secretary general Mohammad Barkindo said in OPEC’s World Oil Outlook 2018.

For the GCC economies, which have traditionally been reliant on the oil and gas sector, low oil prices in the last few years have spurred ambitious diversification agendas, with massive investment allocated to numerous sectors focussing on technology and innovation.

But with huge oil and gas reserves, the region is also continuing to invest heavily in the sector. Energy projects in the Middle East and North Africa (MENA) region alone are anticipated to attract about $1 trillion in investments over the next five years, Arab Petroleum Investments Corporation (Apicorp) said in its annual report in March.

While $345bn has already been committed to projects under execution, $574bn worth of developments are planned in the future, with the region set to see several “critical” energy projects coming up during the period, the report stated.

In line with such substantial investments, the GCC region is also looking to adopt new technologies within its petroleum industry to increase efficiencies, reduce costs and make processes more competent.

Better decision-making and faster time to produce oil and gas topped the list of expected benefits that digital technologies can drive for upstream oil and gas companies, a survey from Accenture and Microsoft found last year.

The global survey showed that the upstream areas most expected to benefit from digital are production (28 per cent), geological and geophysical (27 per cent), and drilling and completion (19 per cent).

Almost two-thirds (62 per cent) of the more than 300 professionals surveyed perceived business value from digital technologies, with 27 per cent totalling it at $50m to $100m or more for their companies.

It also found that in the next three to five years, 70 per cent plan to spend more or significantly more on digital technologies.

The integration of AI in the oil and gas sector has already started taking shape with research underway into creating ‘digital oilfields’ of the future.

The digital oilfield will “radically change how oilfield workers, machines, and the holistic enterprise operate to achieve results and compete in the new digital world”, states a research paper released by the Unconventional Resources Technology Conference last year.

According to the paper, entitled The Rise of the Machines, Analytics, and the Digital Oilfield: AI in the Age of Machine Learning, the new digital oilfield will be a “disruptive technology” that creates new value streams for exploration and production ranging from automated decisions and reactions in real time to massively improved operational efficiencies, connected infrastructure platforms, and much better interaction between machines and humans.

“The days of collecting and storing large volumes of data for later analysis will become a distant memory. The digital oilfield will change expectations for all aspects of our industry ranging from how fast decisions are made to detecting patterns the human eye cannot see in order to take advantage of the insights quicker,” it states.

Data silos will be reduced and information shared across all areas of the oil company.

“At a simple level, artificial intelligence will be used to increase the accuracy of predictions to near-cognitive robotic comprehension in machine learning,” it says.

“In the next 10 years, instantaneous value from digital oilfield systems will dramatically alter the oil and gas landscape as cost and operational efficiencies are attained through the reliance on artificial intelligence,” it adds.

According to Necip Ozyucel, director of Cloud and Enterprise at Microsoft Gulf: “Converging new technologies offer an alternative to traditional routes to development, and make it possible for countries to bring more efficiency and explore new capabilities with relative ease in the oil and gas sector.”

In the oil and gas sector, technologies such as AI, the Internet of Things (IoT), machine learning and big data analytics can serve producers by increasing productivity and streamlining processes, all while helping companies attract and retain talent and remain secure and compliant, he explained.

“From exploration to drilling, from production to transportation, from storage to trading – the intelligent cloud and the intelligent edge come together to deliver industry-specific solutions that can lift petrochemical players into new eras of optimisation, efficiency and profitability,” stated Ozyucel.

“Advanced analytics has already proved itself an effective tool for making actionable sense of the mountains of data generated and logged by IoT sensors. The drilling process can be optimised through deep-dive analysis of such logs, and IoT solutions even allow real-time dashboard intelligence to drive everything from productivity to health and safety.

“The Middle East is witnessing significant traction in the field of AI and local entrepreneurs are working on developing region-specific AI tools,” he added.