The group managing director of Aiteo Eastern Exploration and Production Company, Victor Okoronkwo has stated that digitisation alongside financial leadership and risk management will remain the key areas of focus for upstream oil and gas companies who intend to survive in a post COVID-19 world.
Speaking at the Society of Petroleum Engineers Oloibiri Lecture Series and Energy Forum (SPEOLEF), Aiteo’s boss observed that the oil and gas industry is still grappling with the aftermath of the crash in global oil price and collapse in demand which were triggered by the COVID 19 pandemic.
He stated, “This phenomenon has accelerated new paradigms in portfolio optimisation and supply chain balance in the industry. With the price volatility, geopolitical tussle between Russia and Saudi Arabia experienced during the first wave of global covid lockdown, financial leadership and liquidity risk management will remain major areas of focus for upstream oil and gas companies.”
“Digitisation and Big Data have also become key tools for success in the industry and will gain even more prominence in a post COVID era,” Okoronkwo said.
In his opinion, the lockdown has demonstrated that, with increasing speed and capacity in connectivity (like 5G), digital tools are no longer just enabling communication.
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He explained that these digital tools are accelerating opportunities for value creation and value capture through enterprise integration, communication across multiple social media, remote monitoring, task automation, all to enhance operational efficiency, integrity, and process safety.
“So today, digitization is no longer an option but a fundamental requirement for companies to go leaner and to remain competitive particularly in this era of energy transition,” Aiteo’s GMD said.
He added that digitisation will bring benefits like improved efficiency, cost reduction, improved quality management, transparency in decision making and so on. Competitive positioning in the upstream oil and gas sector, according to Aiteo’s GMD, is hinged on the delicate tripod of cost, production, and price, however, leveraging digital technologies in the post COVID world will help embed a ‘value-for-money’ mindset.
He maintained that this is even so important as the industry grapples with acceleration in energy transition, reductions in upstream capex, increasing disruptions of cloud-based computing, sustained influence of OPEC+ on the global market, and so on.
He warned that digitisation also comes with some challenges such as data privacy and security, upscaling of existing regulations, standardization across platforms and the need for reskilling by the ageing workforce.
Other speakers at the event, such as Minister of State for Petroleum, Timipre Sylva, the group managing director, NNPC, Mele Kyari, and the CEO Department of Petroleum Resources, Auwalu Sarki emphasized that successful implementation of digitization will require collaboration across multiple industry stakeholders including investors, leaders and even policymakers.
