Safety excellence through AI and digitization

Past few months have seen a spike in incidents and causalities in the energy sector, which was otherwise going relatively with a downward trend of incident rates across all the major oil companies. Is this increasing trend of incidents an anomaly or has it to do with any recent developments, such thoughts may be worth investing upon?

The Safety: Cost Equation and the ever reducing CAPEX and OPEX.

Even though not evident it is a fact that improved safety measures have a cost associated to it. Oil and gas since its inception evolved and molded to a much efficient sector and along its way has innovated many safe practices, methods and procedures which are unique and spread across all the phases starting from exploration, oil field construction and to production. Investing in safety is equivalent to investing in efficiency during each phase of the energy cycle. A catastrophe failure harms nature, people and also increases the cost of the project by many folds, and is to be avoided at all times. With the current downturn all prominent oil majors has reduced its CAPEX and OPEX spending to keep themselves profitable.

Rapid changes are ongoing in companies related to oil field construction with major restructuring to match oil barrel price of 40 USD per barrel so that there is sustainability in business. Some may argue that oil has seen such dip in prices in yesteryears. But all trends are not sinusoidal nor in repeating cycles. There has been a sea-change in the economic scenario from last oil price low point to that of now and where technology is in a “front foot”.

The million-dollar question, will these reductions in spending and tight budgets have any impact on the rise in incidents like what is happening now. The first causality of any spending cut will be employees and next in line is the equipment and machinery upkeep. Regular upkeep of machinery and plant of an already ageing facilities of all major old companies will now take a backseat. Decommissioning plans which were made up will now go slow. A plant manager, vessel engineer may keep aside all plans for maintenance under repeated pressure related to economics. Many times the predictive maintenance scenarios employed within the industry are not based on cost-effectiveness or leveraging the actual scenario which a machine/equipment undergoes. The above along with absence of the expert manpower who were well versed with these equipment’s may provide a good recipe for failures and incidents. In such scenario we may have to arrive at the conclusion that these incidents may be just the beginning. If adequate checks or new methods are not put in place, we may see a continuation or a spike in incidents across the spectrum. We can also conclude with surety that the tight spending will continue in the oil sector which is going to see many challenging times ahead.

AI and Digitization — The Redeemer?

It may be hard to conclude that once things come back to normalcy the oil industry will reshape to how it was before. There may not be hiring as before and still the reduced budgets will not facilitate any new improvement or upgrades to existing facilities. Even though there is very high-end usage of technology in the energy sector, for those who are working in this sector will know that there is still plenty of arena for digitization and artificial intelligence in energy sector. Below are a few areas where increased digitization and use of AI and machine learning will bring in good results to reduce such incidents. In energy sector it’s a no brainer that cost of failure of equipment and machinery is much more than the apparent cost.

Its also a good sign that many companies have already started their transition to digitization which will bring in many positive changes in the industry.

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