The oil and gas industry is highly dependent on technology and substantial investments. The smallest of errors, malfunctions or inaccuracies have the potential to cause enormous financial losses. Applying the Internet of Things (IoT) technology to this sector is the key to many problems.
The use of IoT technology is the primary driver of the oil and gas industry’s extraordinary digital transformation. The incorporation of IoT systems into critical processes has allowed the sector to innovate and operate more efficiently than other capital-intensive businesses.
According to a study, IoT technology is currently used extensively by oil and gas corporations. The oil and gas industry’s IoT market is anticipated to reach USD 54.48 billion in 2029 from USD 10.59 billion in 2021, increasing at a CAGR of 23%.
Why Does the Oil and Gas Industry Need IoT?
The oil and gas sector supports vital economic sectors like transportation, electricity production, heating and manufacturing. The sector does, however, face its share of obstacles, such as managing outdated technology and legacy systems, hazardous surroundings, tougher laws and geopolitical events that hamper long-term economic projections.
Industries are implementing innovative technologies, like the IoT, to overcome these obstacles. It connects physical objects to the internet using software, sensors and network connectivity, including wearable tech and construction materials.
IoT enables collecting and exchanging previously unattainable amounts of data with devices or through a central platform without requiring human contact. This data includes aspects like temperature, pressure, flow rates, equipment performance and environmental circumstances.
Real-time communication between the devices enables efficient task completion. Drilling rigs, pipelines, storage facilities and other crucial components all have IoT devices and sensors, allowing industries to closely monitor operations.
By gathering and analyzing data to identify areas for improvement, IoT applications in the oil and gas industry enable organizations to automate operations, increase productivity and lower costs. The production, transportation and distribution operations all use IoT devices and sensors to gather and deliver this data.
Asset Management and Monitoring
For any commercial entity or organization, asset management and monitoring is an organized procedure of tracking and keeping valuable items. It may also include moving assets like cranes and vehicle fleets, as well as non-moving assets like industrial machinery, raw materials and completed items. It may even include human assets.
A simple single gadget or a highly sophisticated structure made up of several sensors might both be considered assets. Operators need to ensure regular maintenance runs with regard to electrical, mechanical and hydraulic processes so that these assets can operate within a suitable regulatory framework.
Every physical device, no matter how big or small, must be tracked as part of asset management in a company. It provides every detail regarding the location, performance, status and condition of the gadget in real-time. It helps in balancing and enhancing output while being highly cost-effective.
IoT-based solutions empower asset management while delivering high-quality company operations. IoT-powered solutions assist in monitoring and identifying specific issues, such as missing components, defective regions and the need for improvement. Organizations can achieve as much as 80% overall equipment effectiveness (OEE) by bringing about these improvements.
Key Trends of IoT in the Oil and Gas Industry
Research suggests implementing IoT can boost income by up to 1.2% in the oil and gas industry, which is a considerable increase. These innovative technologies combine workflows and processes to create new strategic systems.
Real-time data analysis, alerts, dynamic edge control of assets, predictive maintenance, real-time visibility and automated workflows add a layer of sophistication and intelligence to existing processes. Some of the key trends of IoT-powered asset management in the oil and gas industry are:
Asset management in the oil and gas industry offers precise insights into day-to-day operational processes and also helps businesses keep up-to-date status information for secure and effective operations.
IoT devices connected to oil and gas equipment enables timely identification of maintenance requirements, allowing repairs to be arranged well before the equipment malfunctions, avoiding downtime and ensuring worker safety. Predictive asset maintenance has significantly lowered operations and maintenance expenses and has significantly cut the instances of unplanned downtime.
IoT in the oil and gas industry aims to close communication gaps between office workers and field personnel, improving overall safety and worker productivity. Installing IoT devices, sensors and drones allows for secure data collection and ensures seamless operation.
Improved demand management, open material tracking and effective logistics are a few operations that can transform end-to-end logistics and the supply chain via IoT. Monitoring dangerous locations and hazardous conditions of oil exploration sites is difficult. IoT enables remote monitoring of these without human interaction.
Drilling accounts for 20–30% of the entire cost of production in the oil and gas industry, which is the major expense. Using IoT devices simplifies the usage of sand, chemicals and water while increasing operational productivity.
The intelligence-optimized efforts produce a higher labor and time-effective yield. According to a study, using sophisticated analytics can ideally reduce operation time by half. While implementing semi-automated field operations lowers personnel risk and expense of staff onboarding.
Real-time Shipment Tracking
Real-time shipment tracking enables oil and gas industries to keep track of where the cargo is at any given moment and also check on the accuracy of transfers made between supply chain partners. This enables precise scheduling, lowers the possibility of loss and reveals any supply chain delays or constraints.
Remote Site Monitoring
Oil and gas production requires constant monitoring of operations along with the vast array of equipment and manpower that’s been deployed on the field. Maintenance teams become more proactive with the deployment of IoT-enabled remote site monitoring thus ensuring the safety of the personnel by removing them from a potentially dangerous work area.
IoT devices provide routine remote tank monitoring for hazardous materials and industrial liquids without the need for on-site personnel. The devices can also measure water pressure and oil well monitoring. This can be achieved with a control unit, a remote tank monitoring system that incorporates data collection and analysis using accurate sensors.
Exploration of Seismic Oil
Fiber optic cables can be used to connect individual IoT sensors for exploration to map subsurface drilling sites and find new drilling locations that produce the most yield. These seismic sensors convey their readings to a server that maps an image of the possible site when they are linked to the Internet.
The optimal drilling site is then chosen after analysis by a machine-learning system. This method shortens the site selection process and boosts productivity on both new and used sites.
Carbon Emissions Control
IoT solutions in the oil and gas sector benefit the environment since they reduce carbon emissions when a plant operates at a higher efficiency. For instance, leak detection prevents the exposure of dangerous materials into the environment.
Working in oil fields puts the employee’s safety at risk, thus, oil and gas corporations are seeking ways to give their staff members a safe place to work. With the help of IoT, you can improve safety and provide current information on plant operations. The health and safety of employees at work can be greatly enhanced by providing real-time visibility into resources and individuals.