Selling Big Data to Big Oil

Oil firms are swimming in data they don’t use by Tom DiChristopher.

From the post:

McKinsey & Company wanted to know how much of the data gathered by sensors on offshore oil rigs is used in decision-making by the energy industry. The answer, it turns out, is not much at all.

After studying sensors on rigs around the world, the management consulting firm found that less than 1 percent of the information gathered from about 30,000 separate data points was being made available to the people in the industry who make decisions.
Technology that can deliver data on virtually every aspect of drilling, production and rig maintenance has spread throughout the industry. But the capability—or, in some cases, the desire—to process that data has spread nowhere near as quickly. As a result, drillers are almost certainly operating below peak performance—leaving money on the table, experts said.

Drilling more efficiently could also help companies achieve the holy grail—reducing the break-even cost of producing a barrel of oil, said Kirk Coburn, founder and managing director at Surge Ventures, a Houston-based energy technology investment firm.

Separately, a report by global business consulting firm Bain & Co. estimated that better data analysis could help oil and gas companies boost production by 6 to 8 percent. The use of so-called analytics has become commonplace in other industries from banking and airlines to telecommunications and manufacturing, but energy firms continue to lag.

Great article although Tom does seem to assume that better data analysis will automatically lead to better results. It can but I would rather under promise and over deliver, particularly in a industry without a lot of confidence in the services being offered.

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