Price volatility calls for energy sector innovation

ADHERING to "business as usual" without incorporating technology innovation will hinder professionals in the oil and gas industries from meeting challenges such as oil price volatility, Minister of Energy Pehin Orang Kaya Seri Dewa Major General (Rtd) Dato Seri Pahlawan Hj Mohammad Hj Daud said yesterday.

"We all know that the oil and gas industries are facing many challenges, especially oil price volatility and the fact that higher oil prices have resulted in higher cost of goods and services," the minister said in his opening remarks at the "Asset Revitalisation through Technology Innovations for Economically Valuable Solutions" workshop organised by the Society of Petroleum Engineers (SPE).

"If we keep doing 'business as usual' without technology innovation, we will invariably not be able to meet these challenges and obstacles."

Pehin Dato Hj Mohammad said the workshop hosted by the SPE Brunei chapter at The Empire Hotel & Country Club provided an avenue through which professionals could share innovative ideas to make the petroleum industry more competitive and progressive.

"This will directly assist the industry's ability to increase efficiency, which will enable more oil and gas to be recovered from areas that were once thought to be not easy to produce technically and economically, as well as facilitate the development of challenging deep-water areas," he said.

In a keynote address, the asset director of Brunei Shell Petroleum (BSP) said there was "intensifying pressure" on energy companies to produce more in order to keep up with the world's growing energy demand, which is forecasted by the International Energy Agency to increase by 50 per cent by 2030.

"Unfortunately, the scenario today is very different from past decades, where oil reserves today are found to be at challenging and complex subsurfaces," said Hjh Rosmawatty Hj Abd Mumin.

Dubbing today the "non-easy hydrocarbon era", Hjh Rosmawatty said that these challenges could be overcome by pushing professionals to be "more integrated, more innovative and more strategic".

She highlighted several accomplishments BSP had made where previously it had been not feasible or economical to explore and produce oil, but with the latest technologies, BSP had succeeded in doing so. "Clearly, the integration of new technologies helps change the rules of the game and level the playing field."

However, the advances in technology require people with the adequate competencies and the "right innovative attitude", she added.

"Certainly, the technology we need exists. But with great leaps in developing technology, so much greater the leaps must be in developing our people's ability to innovate," Hjh Rosmawatty said.

Speaking on the issue of standardisation, the asset director touched on the dilemma faced when infrastructure and facilities near the end of their useful life as assets mature: whether to invest in newer infrastructure or extend infrastructure life.

Hjh Rosmawatty highlighted BSP's programme of standardising its offshore platform designs following the success of the Champion West Platform. The company has replicated and enhanced the design to its more recent Mampak and Bugan platforms with "remarkable success", she said.

"This approach not only shortened our whole development project time, but also cut costs significantly. Soon, the Selangkir Iron Duke platform will follow the same successful model of standardisation," she added.

The three-day event brought together over 45 participants from 13 oil companies and government bodies from eight countries, including China, Kuwait, Saudi Arabia and the US.

The Brunei Times