How EPC Firms in Oil and Gas are Digitalizing Operations
Engineering, procurement, and construction (EPC) companies in the oil and gas sector are increasingly digitalizing operating models to thrive amid changing customer demand, shrinking margins and new geopolitical influences amid the pandemic.
Such advancements are already evident in the deployment of visualization over traditional modelling, use of robotics and production using 3D printing.
However, the oil and gas sector presents a plethora of challenges to EPC projects due to the sector’s complex and hard-to-reach environments. Due to complex industry requirements, EPC firms are investing in digital capabilities to attain both cost and schedule optimizations.
Yet, oil and gas EPC companies lag behind other industries in digitalization. Here’s why?
- Disconnected platforms: The systematic collection and aggregation of massive volumes of data from disconnected legacy platforms stand in the way of digitalization. Worries over increased errors, security risks and fragmented decision-making due to data collection from multiple touchpoints are delaying digital transformation plans.
- Lack of standardization: EPC companies face distinct construction-specific challenges in the oil and gas sector, including risky geographies and increased complexities. Thus, standardized platforms are requisite in driving faster adoption of digitalization in the sector.
- Conventional operating models:The EPC sector is largely driven by an aging workforce that prefers deploying conventional operating models.
How is digitalization helping EPC firms overcome challenges in oil and gas?
In the rapidly evolving oil and gas paradigm, the role of EPC companies is expected to emerge as a service wherein traditional offerings will advance into software-based solutions to manage overall project execution. These companies will continue to strengthen efforts to leverage big data, internet of things (IoT), and artificial intelligence (AI) to capitalize on opportunities for digitalization. Technological advancements gaining prominence include:
- Integration of big data: One notable advancement includes the use of building information modeling with big data to effectively design, construct and manage structures with the use of 3D virtual models. Similarly, drones are also being deployed to assess the dimensions of hard-to-reach structures or other risky zones, thereby providing a safe means of inspection. EPC firms are also deploying drones in delivering spares, tools and consumables to personnel on site.
- AI-enabled automation: Artificial Intelligence (AI) systems are critical for EPC firms in the oil and gas industry to improve their production efficiencies and reduce the total cost of ownership (TCO). By deploying AI solutions, EPC firms can carry out integration and analysis of data from engineers, architects and construction specialists in order to accelerate the planning and design phases. AI can also assist project managers in scheduling and demand forecasting during the design and planning lifecycle.
- IoT-based equipment maintenance and monitoring: As EPC firms in the oil and gas sector continue to deal with customers demanding services beyond construction and equipment installation, connected devices are emerging as a critical after-market success tool. For instance, leveraging machine-to-machine intelligence can aid field service personnel in delivering quick error diagnosis and solutions. Furthermore, constant monitoring of equipment in real time can facilitate predictive maintenance approaches in order to avoid equipment failure, streamline spare parts management, and improve equipment and personnel safety.
Digitalization will fortify EPC companies against disruptions
EPC companies in the oil and gas need to embrace the risk of transitioning from legacy and manual environments toward more agile and automated business models. As the COVID-19 disrupted several oil and gas EPC processes and brought site operations to a standstill, these companies must integrate digitalization in their operations to strengthen information sharing and automate operations while being agile in response to disruptions.
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