Managing Energy Assets and Operations for the Long Term

As we move into the mid-2020s, the energy field faces pressures to meet the demand for energy resources and reduce emissions to comply with emerging regulations. Increasing oversight requires firms to find ways to maximize traditional output while planning to shift to an energy mix with lower carbon emissions. This challenge affects all stakeholders, from energy companies themselves to investors or finance professionals in energy markets: How can energy assets and operations be managed for long-term gains?

An Ecosystem Approach

As companies approach energy asset management, they should determine their intended place in the energy ecosystem. Who are the key participants, and what are their pain points? Who are their competitors, and what are their strengths and weaknesses? What are their value propositions? And where does their firm want to exist within that ecosystem? Based on this ecosystem mapping, companies can design a long-term strategy, test it, and then work toward execution.

A Digital Era

Despite the widespread embrace of digital technologies like cloud computing, AI, digital modeling, blockchain, and the Internet of Things (IoT), some energy firms are the last ones on the table. However, this reluctance to partner with emerging digital technology represents a tactical mistake for the energy sector. Here are some ways that these technologies can add long-term value:

Cloud computing. Using remote servers to collect, process, and analyze information, or cloud computing, presents numerous opportunities for energy firms. Cloud-based solutions' relatively low cost and scalability can make them preferable to legacy infrastructure.Artificial Intelligence (AI) and large language models are more than novelties. A recent study showed that 92% of oil and gas companies are leveraging AI or implementing it in the next two years to assist in key strategic decisions, and a full 50% of oil and gas executives are already using it to make decisions.Digital twins. Virtual models of assets can allow a firm to make changes and then study possible outcomes, from optimizing equipment and processes to troubleshooting, thus reducing the risk of losing productivity in real conditions.When most people think of blockchain, they think of cryptocurrency. However, blockchain is, at its core, a system of accountability, and accountability is critical in this era of greater environmental oversight. Blockchain can help energy companies to trace emissions back to individual wellheads for reporting.If you have bought an appliance that syncs to your smartphone in the last few months, you have probably already encountered the Internet of Things, a network of smart objects that share information with others. The applications of IoT in the energy sector are vast. Sensors deployed in wells or other assets can share data that can be uploaded to the cloud, analyzed by AI, modeled as digital twins, and tracked by blockchain.

Enterprise Resource Planning for the Long Haul

The key to long-term asset and operations management for energy firms is a strong Enterprise Resource Planning (ERP) partner. Energy professionals involved in strategic planning must consider factors ranging from shifting regulations and geopolitical events to prices and market conditions while monitoring the state of their energy assets. A good oil and gas ERP partner leverages deep industry knowledge and powerful tech stacks involving cloud computing, AI, blockchain, and IoT to simplify decision-making. State-of-the-art information gathering, analysis, reporting, and recommendations will ensure that energy companies remain competitive for years.