Impact of Edge Analytics in the Oil and Gas Industry

Edge Analytics in the Oil and Gas Industry

The Oil and Gas industry plays a pivotal role in the transformation of any country’s economic system. Today, as digital transformation is rapidly bringing change around the world, the industry has the opportunity to reshape its boundaries through digitalization. This can act as an enabler to deal with challenges oil and gas companies face and help deliver value to industry stakeholders. While downtime can hurt any sector and cost a lot, in the oil and gas industry, it can be particularly expensive.

According to a study by Kimberlite, a market research and analytics firm serving the oil and gas industry, offshore oil and gas operators experience an average of US$49 million annually in financial impacts due to unplanned downtime. Also, an MIT Sloan study shows that a liquefied natural gas (LNG) facility can cost US$25 million for a single day of downtime.

Since disruptive technologies such as AI and IoT, among others have found their way into the field of oil and gas, it generates voluminous amount of data. This poses a new set of challenges when it comes to communications, storage, and analysis. This is where edge analytics comes into the picture, enabling effective monitoring and management of oil and gas equipment. Edge analytics refers to a model of data analysis where incoming data streams are assessed at a non-central point in the system. It has become more viable as the internet connectivity is improving relentlessly. Significantly, its evolution relies on the need for fast response times and quick data analysis for IoT networks.

For oil and gas companies, edge analytics provides a wide range of benefits over conventional methods. It eliminates the need to transfer all the data to the cloud, and after processing the data, it gives ability to organizations to decide whether it should be stored in the cloud. As edge analytics optimizes the process by handling the volume of analysis on-site, it helps companies to monitor their equipment and save costs constantly.

In the latest digital world, oil and gas companies still face problems like low production rates, repeated production halts, and regulatory penalties that result in loss of revenue. This all occur due to improper management. In this case, embracing edge computing can be an effective strategy for oil and gas operators, and can make the business case even more compelling.

Storing, maintaining, and doing backup of large volumes of data on the cloud may be expensive. But with edge technology, storage requirements and maintenance costs can be reduced as it removes irrelevant data and store only the data that value. Edge devices can also assist in constant monitoring of equipment and replace the old equipment before they fail lowering the risks of downtime.

Edge technology helps oil and gas companies in the adverse scenario by identifying potential issues. For instance, oil and gas drilling can have quite adverse effects on the environment as it produces hazardous chemicals and wastes, and if there are leaks in the pipelines can create even worse situation for the environment and workers as well. Here, edge technology can help detect possible corrosion and leaks in pipelines to curtail the health risks for workers. Most manufacturing plants today can use edge analytics to keep better track of machinery health, production output, and can be prepare to deal with any adverse circumstances.