Keywords: Oil & Gas, Upstream, Midstream, Shale, Onshore, Offshore, Subsea, Automation, Market Study, Market Research, Market Size
Owner-operators and independent exploration & production (E&P) companies in upstream oil & gas face increasingly difficult operational, environmental, and regulatory challenges as they strive to bring natural gas and other hydrocarbons to market safely, efficiently, and profitably. The recent phenomenon of declining oil prices only adds to these challenges. Advances in drilling technology such as fracking, micro seismic imaging, and horizontal wells led to the successful development of onshore unconventionals. Major operating companies expect to drill tens of thousands of new wells in the next decade to reach these unconventional formations. To achieve such large well numbers and cope with the workload and expected future manpower shortages, well production operations will have to automate wherever possible.
“ARC sees the upstream market offering the greatest growth opportunity for automation going forward. There is a lot of room for improvement in automation in this industry, much of which will be driven by a lack of qualified personnel,” according to analyst Alex Chatha, the principal author of ARC’s “Automation and Software Expenditures in the Oil & Gas Upstream & Midstream Industry Global Market Research Study”.
Reducing Cost and Risk
The oil & gas industry places a premium on reducing cost and risk. Here, the Industrial Internet of Things (IIoT) offer substantial potential for performance improvements based on the ability of IIoT-enabled connected devices and big data analytics to predict and avoid equipment failures.
Automation Critical to Subsea Factory of the Future
Offshore upstream operations are moving toward operations on the ocean floor as companies seek to extract hydrocarbons closer to the source and reduce the significant transportation costs and safety and environmental risks associated with fixed or floating exploration and production platforms. Several industry sources forecast global subsea oil & gas expenditures will exceed $100 billion by 2020.
Technology advancements such as subsea control systems, blowout preventer (BOP) control systems, advanced communication networks, multiphase flow metering, and safety instrumented systems (SIS) are providing operators with the tools necessary for near real-time operational visibility, agility, and flexibility while improving recovery. Based on these and other developments, it’s likely that the “subsea factory of the future” will be a reality by 2020. More mature fields and even smaller fields can benefit materially from subsea operations, thereby maximizing recovery economically.
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