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Digitization Offers High Returns to Emerging Gas Producers Like Mozambique (by Grace Goodrich)

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By Grace Goodrich

The benefits of digital investing in the oil and gas industry are manifold: increased productivity, cost savings, and improved performance all tend to follow investments in big data, the ‘Internet of Things’, intelligence artificial and other digital technologies. Yet, according to the Deloitte Digital Maturity Index released last May, upstream oil and gas lags significantly behind other industries in the pace and degree of digital adoption.

Resistance to digitization in the upstream energy space can be attributed to several factors, some of which apply to hydrocarbon producers regardless of the maturity of their assets or the sophistication of their industry. For example, the oil and gas industry imposes strict health and safety regulations to protect employees from high-risk environments, such as offshore oil rigs, and therefore companies cannot leave – implement automated or robotic technologies without ensuring that new technologies sufficiently take safety precautions into account. The sector also depends on an extensive global supply chain, in which the workforce varies in skills, capabilities, size and cost. Adding to these factors is frequent market volatility, making digital transformations difficult to deploy in light of ever-changing oil prices.

However, one of the main barriers to digital adoption is exclusive to mature producers., in that digital technologies must be integrated into existing systems, as well as the oil and gas personnel who operate them. These markets are often characterized by low exposure and strong resistance to change. As a result, digitization represents a unique opportunity for emerging producers like Mozambique, which discovered significant offshore gas reserves in 2010 and made the final decision to invest $ 20 billion on its LNG development in Mozambique. in Zone 1 as recently as 2019. The relative beginnings of the sector – as the country prepares for the first gas by 2023 – allows Mozambique to integrate the technology into the DNA of its sector as it grows. ‘it evolves in real time, rather than retroactively upgrading technologies and systems.

Oil and gas operations rely on highly technical physical processes, in which digital transformations must be applied to complex and capital-intensive assets, such as offshore platforms, LNG terminals or pipelines. For its part, Mozambique has been at the forefront of large-scale gas developments which are the first of its kind both in the country and on the continent, including the Coral South floating LNG terminal, the first floating newly built deep water. liquefaction plant in the world. Mozambique has also taken advantage of German technological innovation with the supply by Siemens Energy of four centrifugal compressors and six SGT-800 industrial gas turbines to provide on-site power generation to the Mozambique LNG plant. In short, Mozambique has proven to be a worthy beneficiary of foreign expertise and still needs additional technology and knowledge transfer to apply to its range of world-class gas infrastructure projects.

As businesses across industries have had to embrace digital tools for remote working, COVID-19 has accelerated the need for digital deployments, positioning technology as a way to deal with the transformational changes that nearly all industries face. . In the oil and gas sector, in particular, the digitization and optimization of oilfield assets have become the main cost-cutting mechanisms, as energy companies continue to face threats to efficiency, sustainability and efficiency. the profitability. Well integrity, enhanced oil recovery, manufacturing runtime systems, cloud computing – these digital applications are able to unite real-time data with advanced analytics to improve decision making and increase efficiency and sustainability , especially as the need to allocate capital to assets with the highest returns and operational efficiency becomes more urgent.

Now more than ever, Mozambique competes with other border oil and gas markets – both in Africa and outside Africa – to attract foreign direct investment into its nascent energy sector. Digitization represents a strategic competitive advantage, whether by advancing seismic surveys that enable companies to make better drilling decisions, or reducing data interpretation time and associated exploration costs. For Mozambique, digitization represents a billion dollar opportunity that cannot be overlooked.

Africa Oil & Power is working with the Mozambican government to promote investments in energy and various sectors including agriculture, industry, tourism, construction and logistics in 2021. Visit www.MzGasAndPower.com for more details.

On March 8 and 9, AOP will host a Presidential Awards Ceremony (by invitation only) and a day of workshops in Maputo, leading up to the Mozambique Gas & Power 2021 Conference and Exhibition to be held later in 2021. L event is online. If your organization would like to organize a workshop, please send an email to sales@africaoilandpower.com. To register for free, please visit: https://bit.ly/3b3wtkM

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