BUSINESS – ADIPEC looks to new technology

Slide1Neil Ford reports from Abu Dhabi


The global oil sector has always been at the forefront of technological innovation and adoption. It could hardly be otherwise given the presence of huge hydrocarbon reserves that can only be tapped when the oil price reaches a certain level and the necessary technology becomes available. To take one of the biggest examples, the development of deepwater technology, such as floating production storage and offloading (FPSO) vessels, opened up massive reserves in the Atlantic Ocean’s deepwater basins in particular. However, another technological revolution is on the way, according to participants at this year’s Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC).




ADIPEC is the third biggest oil sector event in the world and the biggest outside North America. This year’s event included more than 1,800 exhibitors, attracted more than 60,000 visitors and offered renowned Japanese-US theoretical physicist Michio Kaku as its keynote speaker. With a reputation as one of the world’s most prominent futurologists, he was an ideal guest at an event with the theme ‘Challenges and opportunities for the next 30 years’.

Kaku predicted the digitisation of the oil field, with workers gaining ever more information about the environment within which they work. Perhaps the most widely used innovation will be embedded spectacles that will allow workers access to vast amounts of data while they work. This will include blueprints of oil and gas fields, labelling on objects that they are looking at and even instant translation. Most surprisingly, Kaku said that such tools will be available as soon as 2020, with contact lenses to follow thereafter. Advances in 3D modelling should also help geologists to locate more oil and gas reserves. Malcolm Francis, geology and interpretation manager at Schlumberger, agreed that “new solutions are needed to tackle old problems”, such as the identification of new hydrocarbon reserves.

There are unconventional oil and gas reserves in the Middle East that could be developed in the future using new technology but Gulf oil companies and ministries are content to focus on crude oil and natural gas for the foreseeable future. The Middle East contains about 56% of the world’s remaining oil reserves and production is still increasing in the region.

According to the US Energy Information Administration, the world’s unconventional hydrocarbon resources are almost twice as large as its conventional oil and gas.

Unconventional reserves include tight gas, which is difficult to tap, and coal seam gas, which has revolutionised the North American energy sector. This has led to another development that was widely discussed at ADIPEC: the fall in oil prices from $116/barrel in June to $81/ barrel by the time of the conference. However, speaking on the sidelines of the conference, executives at the Abu Dhabi National Oil Company (ADNOC) and other firms active in the region said that they were basing their investment decisions on long term developments in the industry and not on short term market fluctuations. When and to what extent prices rebound will depend on whether the recent dip in global economic growth is sustained, particularly in China, the United States and Europe.

Undoubtedly the biggest technological challenge will be curtailing carbon emissions. Oil industry executives certainly talk about sustainability and environmental responsibility, and there is some acceptance that climate change needs to be tackled but the phrase “global warming” is rarely uttered at industry events. They do concede that oil’s place in the energy mix may be different in 30 years’ time but there is no recognition that reducing oil consumption is desirable. This is understandable, given that such an eventuality would undermine their own professional but there must be some acceptance that political pressure for lower oil consumption is likely to increase over the next few years.

The big technological challenge will therefore be reducing carbon emissions within the sector itself. ADNOC is already taking carbon from a nearby aluminium smelter and other industrial plants to reject into gas fields to aid production, but it has the added benefit of offsetting its greenhouse gas emissions. Fuel efficiency can also make a contribution, while carbon capture and storage is much talked about but little developed. Technology may yet provide further solutions to mitigate the environmental impact of oil and gas production.


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