IoT in Oil and Gas industry: An Innovative Revolutionary Step

This Image describes the IoT in the oil and gas Industry.
January 29, 2020

Many challenges are faced by the companies extracting and selling oil and gas. To stay competitive in the market and to stay profitable, the companies need to start producing their products at lesser costs. They are working tirelessly to come up with a solution that can help them improve the value of their current products all the while working towards finding new places with oil reserves. They also need to follow the government rules and environmental standards to make sure that the production carries out properly and transparently.


Mitigating the challenges in the oil and gas industry is the first step that these companies need to take to make their business sustainable and profitable. So, let’s follow this post to know more about the same.

Challenges faced by the oil and gas industry

The oil and gas industry is divided into three subsections named upstream, midstream and downstream. Searching new oil and gas reservoirs on the earth is what upstream companies do. The midstream companies are involved in the task of logistics. They are responsible for transporting the different products to refineries, storage facilities, and retailers. Downstream companies deal with the marketing and distribution of the refined end product.

Here we are with some of the main challenges faced by the different sections within the oil and gas industry:

Challenges in upstream

Maintaining equipment that is very expensive and highly complicated, remains as the top challenge in this industry. They need to make use of advanced technologies and heavy machinery to explore the areas where they can effectively extract gas and oil. By the implementation of IoT in the oil and gas sector, it becomes possible for the organizations to track schedules, avert malfunctions, to remotely check even the most effective engineering facilities and in case of any damage, offer automatic alerts.

Challenges in midstream

In order to comply with the already existing regulations, oil and gas technologies have to make physical inspections at the initial level. With the implementation of IoT in the oil and gas sector, it becomes possible for organizations to detect fluctuations in terms of moisture, temperature, and other related parameters. It also helps organizations to keep up with the global standards related to harmful emissions. Moreover, by introducing IoT into the midstream companies, it becomes possible for them to transport the products safely and easily.

Challenges in downstream

Some of the prominent issues faced by downstream oil and gas companies are the treatment of harmful residue, cooling water, recovering solvents, and oily sludge. By the implementation of the Internet of Things, it becomes possible for such downstream companies to boost their operations and efficiently use energy.

Benefits of IoT in the oil and gas industry

The introduction of wireless IoT in the oil and gas sector has helped companies to resolve several issues all the while getting the maximum output. Some of the key benefits of using IoT in the oil and gas industry have been explained below:

• Automation: The oil and gas industry can witness deduced downtime in terms of breakdowns and crashes, and machinery malfunction by the implementation of IoT. IoT can also help you control the instances of accidents at the workplace and boost the security of employees as it removes any involvement of humans.

• Reduce wastage: Making the oil and gas more environment-friendly is also the key focus of IoT in this sector. It does that by avoiding damage of equipment and nullifying the risks associated with leakage.

• Increase safety: The errors caused in this sector due to human involvement can be eliminated to a great extent by the implementation of IoT.

• Boost productivity: The oil and gas industry can make complete use of the technological process to extract oil and gas and, to reduce the expenses involved in such a process. They will be able to boost their production by 6%-8% by opting for data analytics.

• Help with data-driven decisions: IoT can help this industry by offering real-time data that can help the stakeholders to make important decisions regarding the next step in the process i.e. research, extraction, refining, and transportation.

• Decreased carbon footprint: It is possible to reduce carbon emission by efficiently carrying out the operations. The carbon emission coming from drilling and, production of oil and gas can be lowered to a significant level. This way the organizations can fulfill their moral responsibility to not affect the environment negatively while carrying out business operations.

• Increased revenue: It will become possible for organizations to reduce their operational costs by properly investing in IoT. IoT will help the organization to cut down on any unnecessary expenditure as well as reduce human resources that need to be invested otherwise.

• Increase health safety: As per the report of CDC, the O&G industry has been experiencing a lot of causalities. IoT can help such hazardous working environments and make things better for the employees. It can help to predict the equipment which needs maintenance, know which of the employees should be working on a said site, which can be the best way to make evacuation smoother, etc.

Uses cases of IoT in the oil and gas industry

Based on the current scenario and targeted business objectives, the wireless Internet of Things has been implemented at different levels across the companies. Each company is approaching the technology differently and is using the data insights to make meaningful decisions that can help them grow the business.

iot on oil and gas industry

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Remote inspection of machinery

When it comes to preventing accidents in the oil and gas companies, remote inspection is said to play a key role. Say for example, if oil leakage occurs then it can cause environmental issues, lead to monetary losses and even affect the reputation of the company. IoT will help you track down any of such oil leakages and alert the official about the same. Moreover, it will check different types of machinery and prevent damage before happening.

Companies make use of IoT sensors to check the filters, pumps and the main components in the pipeline. It also looks into the thickness of the flow. IoT can also help the companies to ensure international standards are met when using different equipment and machinery.

Preventive equipment maintenance

You cannot stop yourself from seeing the key role played by preventive maintenance in the oil and gas companies. One of the main causes of monetary loss in this industry is due to increased unproductive time and, predictive analytics can help you control and reduce it. One of the top challenges faced by the upstream companies is the issue of tracking conditions of machinery.

In the majority of the cases oil and gas industry carry out mining in the areas that are not easy to access. For the same reason, it is important to have some solution in place which can help you know whether any mining machinery needs repair or has something malfunctioned. It is possible to track the conditions of different types of machinery in real-time with IoT and that too without any human interference.

Real-time tracking of tanker fleets

It becomes possible to monitor the areas which are difficult for the fleet to reach and inspect the parts of the ship remotely, which are carrying the items. All these things can be achieved without investing in any human labor. You can even track down any tanker and know about its condition by opting for such IoT sensors. This way IoT helps you carry out the transportation of the products efficiently and securely.

It becomes possible for IoT to offer a real-time update about the equipment by making use of cellular data, GPS and satellites. IoT also updates the important business software in real-time and if changes take place in equipment operation, it responds.

Advanced data analytics

IoT is meant to collect data that can then be used to get valuable insights. Here large volumes of data are collected, stored, filtered and analyzed. By 2025, IoT devices are expected to collect around 90 zettabytes of data. An IoT ecosystem is built of combining oil and gas production sites and sensors. Some of such collected data is time-sensitive.

Earlier, the satellite was used to transfer such large volumes of data and that took more time too. With the introduction of IoT, things have much changed as here LPWAN is used for transmission of data and large data sets are processed through edge computing. This way, meaningful insights can be delivered to users in readable formats quickly and completely.

Security of employees

Oil and gas companies have been responsible for some of the major accidents taking place onsite. The employees of such companies are working in quite dangerous conditions and always have the risk of hurting themselves. Any issues in the equipment can be known quickly with IoT. In the future, IoT will automate the type of machinery that perform dangerous operations and completely stop any kind of human intervention.

Supply chain management

IoT has made the process of extracting oil and gas quite easier for the companies. Moreover, it also helps to manage the supply chain by offering a set of valuable tools. Based on what IoT sensors can offer oil and gas companies in the form of data, they can make crucial business decisions regarding the operations, inventory management, and manufacturing. IoT sensors even alert the companies if the quantity of oil and gas available at the clients goes low. This way they can instantly refill the product in advance thereby saving clients from last-minute trouble.

Offshore monitoring of oil and rig

In the majority of cases, offshore oil and gas production takes place in extreme environmental conditions. Such environments face limitations in the case of communication networks. This means it becomes hard and expensive for the team to check and monitor different factors like flow rates, pressures, temperatures, etc. Making use of cellular networks cannot be considered as an option here and to use a Wi-Fi network, you need to work on it first to make it functional. To overcome such issues, the industry depends on wired networks or satellite communications to collect critical data and this comes at a high cost.

Now you can cost-effectively connect several monitoring points using LPWANs. Here, you can connect several leak detectors to several wells that are present within a said limit of the LPWAN network. Now a central point that is connected to a satellite will collect all such information back. Compared to the traditional method, such a hybrid system helps to collect in more data that can be monitored later. You can even make use of LPWAN to monitor equipment, measure salinity and keep an eye on employees on-site.

Monitoring refinery

You can use IoT in the oil and gas refinery to monitor several things as explained above. In case a person is made accessible to such information then he or she will have the task to log them on their own. However, it can be time-consuming to log in such large volumes of data by hand and the company can end up spending large amounts of money.

Some areas within the refinery need to measure the factors in real-time. In such scenarios, you cannot depend on LPWAN systems as they are not designed for that. So opting for wired systems is the only way to send the data when you need to take readings every fraction of a second.

IoT, on the other hand, can help you get more reading points to collect accurate data. There may be some part of the refinery from where you cannot measure data as you want. This way the said part may not work as expected due to the absence of more data. With IoT you will be able to collect more data and get better insights, letting that part of the refinery work to its maximum capacity. Again, implementing IoT will also help you reduce the human resource that you need to monitor things manually as well as reduce the number of equipment present in there in a wired environment.


Final thoughts

The use of IoT applications in the oil and gas industry will continue to grow and it can be considered as a constantly evolving process. Apart from just helping companies efficiently extract oil and gas, they cover many other operations and processes. No doubt IoT-powered devices will bring in a new sunrise in oil and gas businesses that are focused on maximum profitability and efficiency.

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