The savvy CEOs of multinational organizations will accelerate their investment in digital transformation projects in 2022, and beyond, to improve their competitiveness. Every industry leader that is forward-looking will act swiftly to grasp the upside opportunity.
Global oil & gas companies face a myriad of operational, commercial, and existential security threats. According to the latest worldwide market study by ABI Research, oil & gas firms apply digitalization to combat these threats and will spend $15.6 billion on digital technologies by 2030.
Oil & Gas Digital Apps Market Development
Investments in digitalization can help to analyze a supply pipeline’s condition, prepare for fluctuations in the changing prices for oil and gas, as well as aid action plans to create more sustainable operations and transfer to producing renewable energy sources.
"Safety and Security are top priorities for oil & gas operators. Data analytics allied with IoT platforms have become essential to identifying issues ahead of time such as pipeline degradation, wellhead performance, and pollution from gas flares," said Michael Larner, principal analyst at ABI Research.
Increasingly, however, communications network security is rapidly becoming a concern for both the industry's executive C-suite and national government regulators of the oil & gas sector.
The effect of the cyber-attack on the Colonial Pipeline put the subject of securing oil and gas operations in sharp focus. The problem for firms is that even spending unlimited amounts to secure networks and IT assets will not provide 100 percent security as attackers only need one error to cause havoc.
Spending on security services is forecast to increase by a CAGR of 8.1 percent from 2021 to 2030 and reach an annual spend of $640 million at the end of the decade.
Beyond IT security, investment by oil & gas firms in 2030 on Internet of Things (IoT) devices and application platforms are forecast to top $5 billion with data analytics spending approaching $2 billion.
The technology supplier ecosystem looking to help operators meet the challenges includes oil and gas focused suppliers such as Schlumberger, Petro.ai, Kongsberg, Earth Science Analytics, and technology specialists such as ABB, AVEVA, AspenTech, Seeq, and Siemens -- all of whom offer software to support operators’ subject matter experts.
Outlook for Oil & Gas IT Applications Growth
"The role of technology is evolving from helping oil and gas firms monitor their large, complex, and dangerous operations to helping them optimize their facilities to handle the volatility in their operating environments,” Larner concludes.
Oil and gas companies have made use of technology, both industrial and computational, but they have been slower than the leading IT organizations in other industries to adopt the latest practices of digital transformation.
That said, I believe some oil and gas company leaders would value an accelerated digital business growth strategy, new information technology capabilities, and innovative IT deployments. I anticipate more oil and gas industry CIOs and CTOs will seek a structured approach to enable new digital services and define the best course of action that's tailored to their specific market situation.