BusinessDay
NigeriaDecides2023

Nigeria’s oil sector looks on as robotics adoption picks up

The world is prepping for an oil and gas industry where completely unmanned assets are operated, inspected and maintained with digitisation and artificial intelligence (AI), a message Africa’s biggest oil-producing country is yet to come to terms with.

Faced with a growing gospel of renewable energy, the oil and gas industry is increasingly embracing digital tools such as machine learning and AI to improve its efficiency in producing, transporting and selling its products, and to help the industry reduce its overall carbon footprint.

Though automation is not really new in the oil and gas industry, BusinessDay’s findings showed investment in robotics for oil platforms increased during the COVID-19 pandemic, when oil firms around the globe were unable to send workers out to rigs, as pandemic restrictions were rolled out.

According to a new report published by GlobalData, a UK-based Data and Analytics Company, Saudi Arabian Oil Co and Royal Dutch Shell Plc are leading the way for artificial intelligence investment among top oil and gas companies.

GlobalData said artificial intelligence has become one of the key themes in the industry of late, with companies hiring for increasingly more roles, making more deals, registering more patents and mentioning it more often in company filings.

The report explained the emergence of Saudi Arabian Oil as one of the artificial intelligence leaders in a list of high-revenue companies in the oil and gas industry, having advertised for 29 positions in artificial intelligence.

In Germany, two oil and gas companies introduced their new robot dogs named Boston Dynamics’ Spot and ANYbotics’ ANYmal at the annual Hannover Messe trade fair held last month.

The two robots were developed to be used for rig inspections, using Norwegian firm Cognite’s AI software-as-a-service (SaaS). The robots gather scans, sensor data, and imaging from remote locations so they can be analysed by workers.

Norway is also using the AI SaaS technology to monitor and analyse its power grid, using drones, and it expects to utilise more inspection robots across energy projects in the future.

“With the emergence of a strong energy tech industry in the US and other parts of the world, developments in robotics are boosting safety standards and efficiency in oil operations and helping firms save money in the long term,” Darryl Willis, corporate vice president of Energy at Microsoft, said in a note published on Forbes.

Read also: Nigeria’s oil sector attracts $61m foreign investment in Q1

“Oil and gas companies are employing machine learning technology across their entire value chains, from wellhead to burner tip,” he added.

Similarly, Royal Dutch Shell has installed software to perform descriptive analytics and predictive maintenance for half a million valves in its operations across the world, deploying about two million machine-learning models in the process, said Tom Siebel founder, chairman and CEO of AI software enterprise company C3.ai.

According to a report from PwC and Microsoft, producers are using AI for well-placement analytics, to determine the best spot to drill a well in order to avoid drilling a dry hole, and for production optimisation to get the most oil or gas out of an oilfield at the most economical time.

“Pipeline companies use AI to analyse pipeline flows and determine the location and size of methane leaks,” the report noted.

It noted that owners of gas processing plants can use AI software to create “digital twins” of equipment, allowing them to conduct predictive and preventive maintenance, analysing when a single component or an entire facility might be likely to require maintenance before it actually needs it.

As the rest of the world moves on with artificial intelligence and innovation, Nigeria remains uncertain about how to proceed with old perennial problems such as with sub-optimal oil production, poor infrastructure, and fuel subsidies.

For instance, data obtained from the Organization of the Petroleum Exporting Countries showed Nigeria’s oil rig count, which depicts the level of oil production activities by operators, was 11 in May.

Still struggling with production challenges, a BusinessDay check showed that the only time in recent history that Nigeria experienced such abysmally low drilling activities was in the heat of the Niger Delta crisis in 2016.

Rather than enact market-friendly policies that unlock billions of dollars investment in the country’s energy sector, the government is seen to be prioritising controversial spending like subsidising petrol, which will gulp N4 trillion in this year’s budget.

Critics say Nigeria’s energy sector focuses solely on revenue generation and does not look at domesticating the value chain of by-products that are needed to boost productivity and more revenue in the long-run, in the process a lot of investments have been discouraged.

“Policies are put in place by people who don’t know how the economy works and what policies are sustainable,” said Muda Yusuf, the immediate past director-general at Lagos Chamber of Commerce and Industry.

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