Nigeria’s oil and gas industry was a story of a boom in the 1970s, but times are changing with the increase in oil prices and government expenditure. The world is now in an era of major social, technological, and political trends that could reshape the environment in which oil and gas companies operate. While consumer-driven sectors such as media, food, tourism, fashion, and retail banking are far along the path toward technological transformation, oil and gas remains ranked as one of the least technologically-mature sectors of the economy.
Emerging technological innovations have the potential to lead to sustained lower oil prices, efficiency, and speed. Whereas the Federal Ministry of Petroleum Resources is waking slowly waking up to this reality, as evidenced by the introduction of technological transformation initiatives, most are still in their early stages.
Crude Oil Prices: 2020
Making the Culture Case
The cultural aspect of technological transformation in Nigeria’s oil and gas industry has perhaps been often overlooked in favour of hype around new technologies. But as those with experience of institutional transformation will attest, the integration of new technologies will have a limited impact within any organization whose processes do not shift to accommodate them.
At this point, a change of mindset that is driven by the availability of more data requires investment in workforce upskilling and training. There is also the need to structure oil and gas companies such that decisions are made based on data and characterized by a shift from being reactive to being proactive. This may be easier said than done but adopting new technologies is crucial if the oil and gas industry must attract talent among millennials and generation Z, who think of oil and gas as outdated in comparison to businesses perceived as real ‘tech companies’.
Stages of Technology Qualification Process
The Business Side of Things
When all is said and done, technological transformation is, ultimately, about driving better business outcomes for the oil and gas industry. Given the demands placed upon oil and gas enterprises to meet criteria for environmental sustainability as well as the uncertainty of global demand for oil and gas, companies must find ways to sustain profitability.
The exponential advancement in technologies, reduced digitalization costs and the increase of connected devices promise a competitive opportunity to the upstream supply chain of Nigeria’s oil and gas sector. With the 5G era, technological transformation offers a ready solution, for oil and gas enterprises willing to make the journey.
Early Engagements Hold the Key
One of the most effective themes to enhance technological advancement and build autonomous operations in Nigeria’s oil and gas industry is early engagement in oil and gas companies. This allows the possibility to drive standardization, reduce costs, meet demands, project development, and ultimately, the integration of technology.
According to the World Economic Forum, these recommendations for digital transformation are expected to support oil and gas companies:
- Make digital transformation a priority for senior executives.
- Support a culture of innovation and technology adoption.
- Invest in human capital and development programmes that promote new and digital thinking.
- Introduce a methodical approach for developing or industrializing new capabilities.
- Reform data architecture of the company.
- Identify opportunities to enhance collaboration and understanding of sharing-economy platforms.