Adapt or die? Gen AI in oil and gas

Alright, The oil and gas sector is gearing up to deal with yet another technological revolution. I love all the enthusiasm about AI and energy tech advancing the oil and gas industry. Seems anyone with an idea has already pushed out solutions with "AI inside"... well let's take skip the clickbaiters and hype train engineers and take a deeper dive into what it really takes to achieve the transformative potential of AI in the oil and gas industry.

As usual, this new tech is positioning itself in almost all industries as not just an upgrade but a complete overhaul. Moving from the simplistic, albeit useful, AI based on machine learning algorithms to a vast and vibrant world of generative artificial intelligence (Gen AI). While Gen AI isn’t merely an adopt to step up; true adaption of transforming your company to AI brings capability to leap into a future where every component of the industry could be transformed. Sounds grand, right? Been there done that? I dont believe this is a new boss same as the old. But let’s pump the brakes for a moment and take a closer look.

The Promise of AI: Integration and Intelligence AI promises to not just process but to integrate and interpret data like never before. For instance, consider Shell’s use of AI to not just analyze geological data but to synthesize it with market dynamics and environmental regulations. This isn't about finding more oil faster; it's about smarter, safer, and more sustainable drilling decisions. AI systems can predict market trends, adjust operations in real-time, and even foresee regulatory changes, enabling companies to operate with unprecedented foresight and agility.

Real-time AI for Proactive Operations Traditionally, the industry has been reactive—fixing issues as they arise. With AI, we’re looking at a proactive paradigm. BP, for example, has employed AI-driven systems that utilize vast sensor networks to predict equipment malfunctions weeks before they might occur. This predictive capability isn’t just convenient; it's economically and environmentally crucial, preventing oil spills and equipment failures that could have catastrophic consequences.

Cross-disciplinary Innovation AI’s ability to break down operational silos within the industry is perhaps one of its most revolutionary aspects. Take ExxonMobil, which has integrated AI across its production chain. This holistic approach doesn't just improve individual aspects of operations but enhances overall efficiency, from drilling to distribution. The AI systems coordinate different operations, ensuring that changes in drilling operations are immediately reflected in supply chain adjustments and market strategies.

Future-proofing Through Scalable Innovations The future of oil and gas is not just about adapting to today’s challenges but anticipating tomorrow’s. Companies are now investing in AI that not only fits into current models but is scalable and adaptable to future needs. Consider TotalEnergies’ integration of renewable energies; their AI platforms are being designed to manage traditional oil and gas operations alongside newer, renewable ventures, creating a blended energy approach that could redefine the industry’s future.

A Word of Caution: The Investment in AI While the potential of AI is vast, the path there is fraught with challenges. The adoption of AI in such a complex industry requires significant operational change, investment in technology and personnel. The risks aren't just operational or financial, but ethical and cyber-physical.

This journey toward an Gen AI-driven oil and gas sector is not merely about adopting new fangled technology—it requires a large scale adaptation and a transformative shift in operations, cultural mindset, and revamping of industry standards. Not your typical tech upgrade. Then there is the idea of taking in Gen AI slowly. Baby steps across areas that are broken already. That brings a risk of being left behind by those who adapt faster.

Navigating this complex terrain where billions to trillions are at stake requires leadership to balance between enthusiasm for innovation and a rigorous, critical approach to the challenges ahead for a company and industry as a whole. O&G is not big on diving head first into new tech, yet with Gen AI, O&G stands to benefit greatly by adapting to Gen AI. Don't blink, and keep your eyes (and data) dry.