The 4thFederal IT Forum of Russian Oil and Gas Industry "Smart Oil & Gas", held on September 19-20, 2018 in St. Petersburg, confirmed the status of the main platform for professional discussion of lines, technologies and solutions for the digital transformation of oil and gas companies.
The forum showed that the Russian oil and gas industry is in the forefront of digital transformation, and industry companies are able to find proportion of foreign and import-substituting products that is close to ideal.
Digital transformation begins with understanding of opportunities and awareness of risks. Many steps along this path require concerted action of oil and gas companies, as well as state bodies and development institutions. The 4thFederal IT Forum of Russian Oil and Gas Industry "Smart Oil & Gas" invited participants to a journey that has not been completed yet by any gas or oil company in the world: from cubic meters and barrels to bytes.
Along with Gazprom Neft, LUKOIL and SIBUR, the plenary sessions, round tables and forum discussions were attended by representatives of such companies as Zarubezhneft, Salym Petroleum Development NV, Gazprom International, Gazprom transgaz St. Petersburg, Surgutneftegaz, Shell, The International Coordination Center (Kuwait), Rosneft, Tatneft. And also the heads of the subsidiaries of the Russian oil and gas market participants were among the speakers, including Gazpromneft STC, Gazpromneft-Snabzhenie, ITSK, Avtomatika-Service, NoyabrskNefteGazSvyaz, LUKOIL-Inform, Sibintek, Zarnestservis, etc.
Speaking at the forum plenary session, Vyacheslav Berzin, Chief of Metrology Control, Automation, Standardization and Information Technologies Department of Zarubezhneft, noted that industry companies have different understandings of what digital transformation is. In his opinion, it consists of two blocks – a technological block (including the new solutions' piloting) and a block of cultural transformations. At the same time, Vyacheslav Berzin accentuated that since digital transformation should lead to changes in business processes, digital initiatives should not focus on piloting. "Pilot implementations do not lead to changing processes," he said. "The project that ended with a pilot is a project that ended with nothing." Zarubezhneft attaches special importance to cultural transformations: according to Vyacheslav Berzin, the company is actively involved in the process of knowledge management and the creation of a system for knowledge' distribution. This, in turn, is associated with increasing the level of business maturity at all levels.
The Forum of 2018 became the largest in the 4-year history of this event: during two days 100 representatives of industry companies, state bodies, international and Russian developers, integrators and analysts spoke in 15 sessions. The total number of forum participants was about 650 people. In 2018, three oil and gas companies became strategic partners of the IT forum: Gazprom Neft, LUKOIL and SIBUR. They sent numerous delegations to this event, including speakers and session's moderators.
In contrast, Alexander Pruzhinin, Head of the Customer Service Center for Information Technology Support, Department of information and technology support, LUKOIL, supports pilot projects. "The oil and gas industry is conservative, and we are a large company, so most of the systems in LUKOIL are being implemented after the pilot projects and the expected effects verification," Alexander Pruzhinin said.
Dmitry Moskovich, Deputy General Director for Automation, Gazprom transgaz Saint-Petersburg, pointed to the obstacle to digital transformation: in many industry companies "ordinary IT specialists whose hands do everything, are poorly versed in production, and the producers are not at all able to think systematically in IT terms." "And while we do not settle the exchange of information between them, it is too early to talk about a full digital transformation of production. Often the IT systems' implementation is "for the sake of IT people". The large flow of information that we send to production workers does not cause them joy or understanding of goals and reasons for filling in different forms," Moskovich complained. At the same time he accentuated that properly organized digital transformation is a huge resource for increasing the enterprise efficiency even within the scope of the available technologies.
According to Alexander Pruzhinin, business units in LUKOIL are involved in making decisions on the use of digital technologies, and most of the projects are carried out with business' direct participation. "Therefore, we are insured against situations when the IT unit does something, and then the business does not use it," he said.
Evgeny Korneyev, Head of Information and Information Technologiesin Salym Petroleum Development N.V., said that his oil company that is small and independent had to decide whether to compete with giants who can afford to invest in expensive pilot projects, or choose a different path to remain competitive. He reminded the forum participants about the change acceptance curve, according to which 60% of employees are not in the forefront. "We need to understand how the whole company will move into the digital age, and we will not go there without these 60%, so our focus is to work with the company as a whole," said Korneyev, adding that this strategy does not exclude point pilot projects.
Acting Head of the Department of Information Technologies, Automation and Telecommunications, Gazprom Neft, Alexey Poperlyukov, who is also General Director of ITSK, said: "At Gazprom Neft, the digital transformation is in high gear: this is no longer a hype, and in some cases it's even a routine. Business units have tasted new technologies – they require them, they invest in them and they want more." He reminded that the chairman of the board of Gazprom Neft, Alexander Dyukov, set the task to turn the company into a global benchmark for efficiency, security, and technological equipment, and it is digital transformation of business that is the key to its solution.
"Our main goal is to manage projects effectively, and to deal with it we need to manage the data, analyze them and make the right decisions. We have prepared for large-scale digitalization, made projects that optimize internal business processes"
Automated Control Systems Department, Management Information Systems and Telecommunication Division of Gazprom International
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Konstantin Tarasevich, Automated Control Systems Department, Management Information Systems and Telecommunication Division of Gazprom International, recalled that his company represents Gazprom interests abroad, participating in upstream projects around the world through 30 joint ventures and subsidiaries. "Our main goal is to manage projects effectively, and to deal with it we need to manage the data, analyze them and make the right decisions. We have prepared for large-scale digitalization, made projects that optimize internal business processes," Tarasevich said. At the next stage, Gazprom International intends to create ecosystems to enhance the effectiveness of interaction with business partners. "Involvement in digital transformation processes for industry companies will soon become a matter of survival," Tarasevich summarized.
The Chief Executive Officer of Gazpromneft STC Mars Khasanov recommended paying special attention to the first stage of deposits development, including the creation of geological hydrodynamic models. "At the first stage, you can increase efficiency by 2-3 times, and if you make a mistake during the deposit development, the subsequent online optimization can increase the efficiency by no more than 15%. In the old days, we were deterred by the lack of computer capacities; now these barriers have been removed," Khasanov stressed. He pointed out that often the emphasis in digital transformation is on exploitation, on making quick decisions, on online optimization, that is good for the deposits that are already equipped ("where all the mistakes are already made, the main capital costs have already been incurred, the deposits have already been drilled"), and called for more active use of digital approaches to create concepts and geological and hydrodynamic modeling, when it is necessary to make decisions in conditions of uncertainty, and to master the entire new regions of the scale of Yamal or Eastern Siberia.