[Editor's note: This story originally appeared in the January 2020 edition of E&P. Subscribe to the magazine here.]
For software as a solution (SaaS) providers like Arnlea, the discussion has to center on allowing customers to let the SaaS provider host its software systems so those customers can begin to collate anonymized industry data to share with all participants for mutual benefit.
This bold vision would see all major oil and gas operators hosted on the same application to enable discrete data packages collated from a single source to facilitate greater intelligence about parts and product.
Like many other smaller specialist SaaS providers, Arnlea’s software can integrate with enterprise resource programs, such as SAP, and it works most effectively for clients when it does. This means Arnlea’s external software has to be on the same landscape and in the same environment as the client’s own internal SAP program. That is the first challenge, as this is a massive barrier to data sharing. Procurement and project teams may be open to this concept, but IT teams are often risk-averse and concerned this could expose their corporate data. This attitude is preventing the oil and gas industry from taking significant strides forward in the way it handles, manages and profits from its data.
The real irony is that every business, large and small, believes the way it manages its data and data security is unique and that its systems are bespoke, distinctive and provide a powerful commercial advantage. The reality is all businesses are using the same systems, so there are enough significant similarities between companies to derive considerable capex and opex advantages from data sharing across the industry. Companies share kit, fields and people to mutual advantage, but somehow customers think sharing anonymized data would compromise the integrity of their business.
Modern tech applications all specialize in a single function; there is no longer a one-stop shop for everything. Arnlea also partners with other tech companies, sharing best practice and serving shared clients together in a much better way than being separate isolated providers. Integrating partners, services and products gives the end client a far superior service and better value for money. Combining data and clients together is fundamentally desirable, but the mindset has to change. Other industries, such as automotive and aerospace, are much further down the line with this than the oil and gas industry.
Crucially, the creation of predictive failure analysis, best value suppliers, most reliable supply sources and identifying surplus available product or product absence would be possible by combining all inspection and maintenance data and then providing that information back to clients as intelligent, critical information.
The dream scenario is a client that has invested in and is willing to use software entirely as it was intended. A uniform digital landscape across all their own territories would be required so that their total physical business was already working together, sharing data with itself easily and naturally. The client would be able to use data from across the whole business and share best practice across the entire organization. It would transform many operators and improve capex and opex.
Fresh thinking to see true digital transformation on this level across this industry is urgently needed. It will bring about a powerful shift in client operational decision-making; sharing best practice and buying power is just the tip of the data-sharing iceberg.
Daniel Rice, former CEO of Rice Energy who now sits on the EQT board, addressed the elephant in the room earlier this month at Hart Energy’s Energy Capital Conference.
Schlumberger has spent billions of dollars to take over managing customers' oil fields, in some cases becoming an investor in the fields, while seeking to profit from increased oil production.
Technological progress and the threat of climate change are forcing both oil companies and utilities to rethink their strategies, and are pushing them into each other’s territory.