Innovative suppliers in high demand
Julien Truflandier, global product manager for Oil & Gas Downstream and Chemicals at Nexans, says collaboration with innovative suppliers strikes the right balance between cost, performance and sustainability
As the oil and gas industry improves efficiencies and reduces costs, oil and gas projects become increasingly complex. Drilling is moving further offshore, forcing companies to find new solutions for deepwater developments.
The downstream sector is facing challenges processing new, unconventional oil resources. And logistically, supplies have to be delivered quickly, often to remote areas lacking infrastructure.
Another factor: sustainability is increasingly being considered as part of purchasing decisions alongside traditional elements like price, quality and performance. To keep up with trends, companies need to rethink their supply chain and their relationship with suppliers.
Innovation in the industrial DNA
The world’s population continues to grow, and the International Energy Agency predicts that oil demand will continue to grow and natural gas use will rise by 45% to 2040, becoming the second-largest fuel in the global mix after oil. The industrial DNA of any player that aspires to lead in such a competitive market – including both oil and gas companies and their suppliers—needs to have innovation at its core.
For instance, as offshore field developments move to deeper waters in search of new oil sources, companies should be ready to overcome the technical challenges they will face several kilometres subsea. These cabling solutions include umbilicals, direct electrical heating systems (DEH), top-side power, control, instrumentation and telecom solutions.
These products and solutions need to eliminate common challenges faced by the oil and gas industry, such as cable corrosion, strain and stress. As the key physical link to deliver energy, cabling system suppliers ultimately aim to support the industry by increasing operational safety, protecting field assets, handling drilling muds, allowing drilling in challenging conditions, and protecting against extreme environmental conditions.
Looking ahead, digitalisation stands out among the trends that are shaping the future of the oil and gas sector. According to recent research by McKinsey, conducted in the context of the upcoming Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC), a range of interconnected emerging technologies including sensor technology, blockchain and machine learning have the power to unlock a potential $50 billion in savings and increased profit for the sector.
The supply chain has not been immune to the same disruptions. The leading cable suppliers have to keep up with these new trends by adapting their solutions, for example by applying an integrated logistical approach to tracking and ensuring that cabling products are compatible with the latest technologies. This not only reduces costs but makes customers’ lives easier.
Today, transforming the oil and gas sector goes beyond designing and producing innovative products; it is also a way of working with the customer in a truly collaborative and partnership-based approach. Effective planning and meticulous project execution to avoid delays and any potential financial impact of downtime are the industry’s bread-and-butter. This is the reason why global suppliers are pursuing an aggressive delivery-time strategy.
The ability to simultaneously mobilise factories domestically and internationally, as well as to produce tailor-made products in line with international standards and customers’ requirements, allows for the optimisation of production, thus shortening lead times while ensuring consistency of performance.
Producing high-quality products in the shortest periods is just one part of the complex history of supporting the logistics and storage industry within the oil and gas sector. One critical step to ensure operations run smoothly comes during installation. Here, flexibility and adaptability to customers’ demands and needs is paramount.
Sometimes, it is necessary for engineers from the cable manufacturing company to be present on rigs, ensuring smooth installation, safe handling procedures, overseeing the installation of accessories and carrying out operational modifications. Training and supervising the company’s team is also a valid alternative.
Providing logistical support to the upstream and downstream oil and gas industry in the Middle East requires a balanced mix of planning, state-of-the-art products and local knowledge, all alongside advanced technical and engineering skills and services. Looking at the future, with the oil price picking up again, suppliers’ ability to partner with their clients and provide them with a range of high-performance products, services and innovations will make a true difference in many oil and gas projects in the region.