From modern transportation to financial networks, we rely on digital data every day-whether it be at work, at school, or at play. And now more than ever, this data needs to be carefully managed across different “boundaries” without losing control. Considering how tightly integrated data is in our lives today, how did we ever get by without it?
Throughout Summer 2015, we examined the important role that data plays in various industries (healthcare, media & entertainment, financial services) and the impact of going a day without data. Today, we discuss data’s impact in the Oil & Gas sector.
Skyrocketing gas prices used to be a constant in our daily lives, but have you noticed the dip in gas prices over recent years? According to the U.S. Energy Information Administration, average gas prices were as high as $3.68 per gallon in 2012-almost a dollar more than the average price in July 2015 of $2.87 per gallon. There are several reasons for the decline in price, but here’s one reason that you might not have thought of: data.
The method of finding and processing natural resources has always been a complex and much-debated topic. But behind the scenes, one thing is certain: Data plays an important role in helping things run smoothly. Energy companies use data to improve the discovery and exploration of natural resources and oil for drilling, and, ultimately, data can even help decrease gas prices.
Although data is everywhere, few industries have figured out how to drill into this gold mine to leverage it effectively. However, Bain & Company points out that, compared with most sectors, the oil and gas industry has been historically more successful in finding innovative uses for data. Oil and gas companies find ways to use data to discover the natural resources that power our everyday lives.
Along with recent technological advances, oil and gas companies can leverage powerful analytics tools to collect and examine the growing amount of digital information. This ability in turn can result in the intelligent insights that are required to create efficiencies in the discovery and extraction process.
Data helps oil companies find new hydrocarbon deposits easier. By leveraging big data, the usual process for finding these deposits-which normally requires a lot of materials, personnel, and logistics-can become more streamlined. The use of big data can also help reduce costly mistakes such as drilling in the wrong location. In some cases, a 50-foot deviation in a horizontal well that is thousands of feet below the surface can mean the difference between profit and loss. With improved search procedures, the costs for producers and consumers alike might eventually decrease.
So what does a day without data in the oil and gas industry look like?
Ultimately, a day without data in the oil and gas industry would negatively affect consumers around the world and would take a toll on the global economy. Oil and gas companies would cease to operate efficiently, and millions of dollars would be lost. Without timely information about where oil reserves and other natural resources are, energy and gas companies worldwide would be forced to revert back to a system of trial and error during both production and exploration. This costly process would have a trickle-down effect.
Data plays a significant role in the oil and gas industry for these reasons and more. According to Bain & Company, advanced analytics can continue to improve production by 6% to 8% in three areas: geological interpretation, new well delivery, and well and field optimization. Bain & Company points out that only 4% of companies have the capabilities to use advanced data analytics to deliver tangible business value. An increase in this number can bring about significant changes in our lives-from lower gas prices to an overall improved economy and environment.
NetApp continues to work with oil and gas partners and customers around the world to drive innovation that helps them increase operational effectiveness and lower costs now and into the future.