Disruptive technologies transforming the GCC energy sector

Benoit Dubarle, President Gulf Countries & Pakistan at Schneider Electric, says billions are required for Gulf power generation

Ehtesham Shahid
Ehtesham Shahid
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What could be common between wearables, drones and 3D printing? Besides being the latest tech-fads, these are also the most important emerging disruptive technologies which are beginning to impact the energy sector.

Wearables, such as terrain-specific glasses, can transmit images real-time, enable group observations and help collective decision-making in oil fields. Drones can survey the pipelines while 3D printing can speed up manufacturing of parts for the energy supply chain. Indeed, all these save time and costs at a time when purses are tightening.

Few understand this transformation better than Benoit Dubarle, President of Schneider Electric in Gulf Countries & Pakistan. Benoit explains how smart oil and gas solutions help make oilfield operations – both upstream and downstream – as efficient as possible. Schneider Electric specializes in energy management and automation.

“These solutions offer operators with real-time data and analytics to enable management, monitoring and informed decision-making. Today, machines are communicating with each other using advanced intelligent platforms,” says Benoit.

This isn’t just an oil and gas phenomenon indeed as machine-to-machine (M2M) network, dubbed the Internet of Things (IoT), will probably permeate through every industry and provide solutions for enhanced safety, sustainability and reliability.

It was only appropriate that Banoit spoke about this transformation on the sidelines of the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC) 2016, recently which showcased IoT-enabled smart oil and gas solutions.

But is the oil price slump impacting the adoption of these technologies? Benoit concedes that, in the resulting economic challenges, some CIOs and CEOs may be reluctant to invest in IoT-based applications and to upgrade their legacy technologies.

“However, given the emphasis on energy management for smarter and more sustainable living, and the awareness surrounding its business benefits, we will see widespread adoption of IoT across enterprises in the coming years,” he says. According to Benoit, energy efficiency solutions are seen as a major value-add in the transition toward renewables and smart energy management.

This transition is evident in many ways. A Schneider report – Industrial Internet if Things (IIoT) Impact on the Oil & Gas Industry Value Chain – indicates that the energy market spent $7 billion on IoT solutions in 2015, and is projected to climb to $22 billion in 2020.

“The O&G industry spend $6 billion on data management with a projected annual compound spending growth rate of 28 percent to $21 billion by 2020. The company thus remains optimistic about growth opportunities for these solutions in the region (and globally),” says Benoit.

Tens of billions worth of investments are required for the Gulf’s power generation, transmission and efficient energy use. A PwC report, Financing the Future of Energy, says the energy demand is expected to increase three times in the next 15 years and will not be met by today’s supply.

In order to address this demand, Benoit says, Gulf states will require massive investments in projects which can increase generation capacity as well as energy efficiency.

Some reports claim that data generated by oil and gas companies exceeds 1.5 terabytes a day, which itself calls for greater efficiency. Benoit says it is critical that industry players are able to extract value and analyze the “raw data” gathered.

According to him, IoT can play a valuable role in this and, in fact, is already beginning to happen. “According to Oxford Economics, industry-wide adoption of IoT can increase the global Generalized System of Preferences (GSP) by 0.8 percent or $816 billion in the next decade”.

While rapid technological advancements are influencing decision-making across oil markets, some countries are at the forefront of this change. Saudi Arabia, which is the region’s largest exporter of crude, with almost 19 percent of global exports in 2013, is also the world’s seventh largest consumer of oil.

According to Benoit, Saudi Arabia is taking several steps toward energy efficiency amid its ambitions to diversify away from a purely-hydrocarbons economy. He also cites King Abdullah City for Atomic and Renewable Energy plans to develop 54 GW of renewable energy by 2040.

Several renewable projects are underway including the KAUST solar power plant and initiatives by Saudi Aramco. The Saudi Electricity Company recently signed a SR4.5 billion contract with General Electric to establish the country’s first fossil fuel and solar power plant near the Red Sea port of Dhuba.

Those are clearly signs of things to come and, Benoit emphasizes, that the Gulf region is up for the challenges that lie ahead.

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