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Energy companies look to tech to make oil production easier and cheaper

Travis Bubenik May 26, 2017
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Jack Gregg, senior global marketing director with Honeywell Process Solutions, explains one of his company’s touch-screen control boards, used for a variety of remote operations centers in the oil and gas industry.
Travis Bubenik

Jack Gregg with tech company Honeywell shows me around a sort of new car showroom for companies shopping for “smart” oilfield gear. The energy industry is increasingly investing in ways to make oil production easier and cheaper. Companies are using cloud technologies and mobile devices. The time-consuming work of driving out to a field to check on equipment can now be done from afar.

Honeywell builds high-definition, touch-screen control boards to help make that possible.

“We can actually control processes from inside an office building downtown, and the actual process could be hundreds of miles away in a remote location,” Gregg said.

When your business is subject to the whims of boom-and-bust cycles the way the oil industry is, making money with less effort is very appealing. With that in mind, oil companies are using technology to cut costs ­while still turning a profit in the downturn.

“This is about reshaping the industry,” said Muqsit Ashraf, energy strategy consultant with the firm Accenture. He points out tech advances can keep workers safe. 

But technology changes will also affect the workforce itself. 

A look inside Honeywell’s Customer Experience Center in Houston, a sort of new car showroom for oil and gas companies. 

“The profile of the employees will change,” he said. “There would be a shift in terms of head count on the field to head count that might be sitting in remote operations centers making decisions.”

Technology is replacing energy workers. For example, oilfield services company Schlumberger has estimated one of its newer, more automated drilling rigs could cut the number of work hours needed to finish a well by more than 30 percent. But in the long term, the effect on jobs is hard to predict, according to Rice University’s Mark Agerton.

“It really depends on whether the technology is going to lower the cost of extraction and make us extract more oil and gas, and hire more people to do that, or if the technology is going to allow us to replace people with machines,” he said.

A more digitized industry also means companies will need more educated, higher-skilled workers to operate new technologies.

These advances are helping drillers in Texas make money even with low oil prices. But another boom could slow the innovation. If prices shoot back up, companies might decide to revert back to more time-tested ways of moving oil.

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