Oil and gas companies are investing in new technologies to reduce carbon emissions, optimize sprawling asset networks, ISG Provider Lens report says
Oil and gas companies in the U.K., bolstered by high demand and rising prices, are increasing investments in new technologies for improved operations, sustainable energy sources and other objectives, according to a new research report published today by Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.
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“Service providers are helping them adopt digital tools for identifying and managing their carbon emissions.”
The 2022 ISG Provider Lens™ Oil and Gas Industry — Services and Solutions report for the U.K. finds the country’s oil and gas industry has been rocked by the Russia-Ukraine war, the European energy crisis and new regulations, in addition to the ongoing effects of the COVID-19 pandemic. Companies, the report says, need to become more capable in many areas to navigate these challenges and prepare for the future.
“The most competitive and sustainable oil and gas companies in the U.K. will be those that are building a strong digital foundation,” said Ola Chowning, partner, North Europe, with ISG. “Service providers are helping clients transform their operations and digital infrastructure.”
Oil and gas producers operate complex, expanding networks of connected assets that generate huge amounts of data, ISG says. Companies in the U.K. are investing in new solutions and services to both optimally manage these networks and make the best use of the data for decision making. They face these challenges amid an ongoing shortage of skilled labor, made worse by the uncertainty caused by decarbonization efforts. New technologies such as industrial IoT and AI are helping to ease the skills shortage.
The oil and gas industry is growing rapidly as the U.K. works to reduce fossil fuel imports and become self-reliant, opening up new areas of the North Sea for exploration and production, the report says. At the same time, the U.K. government is pushing the industry to achieve net-zero emissions. This energy transition has become a focus for many oil and gas companies in the U.K., where the industry is under more pressure for sustainability than in North America, ISG says.
“Oil and gas companies have a role to play in the U.K. reaching its overall environmental goals,” said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. “Service providers are helping them adopt digital tools for identifying and managing their carbon emissions.”
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Rising prices, driven in part by the Russia-Ukraine war, have increased profits, leading the government to impose a 25 percent windfall tax on profits made from extracting oil and gas in the region. The new levy adds pressure on companies to become more efficient through digital transformation, and it is helping to shift new investments toward sustainability.
The report also examines other trends affecting the U.K. oil and gas industry, including the growing demand for strong cybersecurity protections and improved capital projects management.
The 2022 ISG Provider Lens™ Oil and Gas Industry — Services and Solutions report for the U.K. evaluates the capabilities of 34 providers across five quadrants: Enterprise Asset Management, Next-Gen IT/OT Services, Capital Projects Management, Data Management and Cloud Computing, and Energy Transition Services.
The report names Accenture, Deloitte, IBM, Infosys, KPMG, PwC, TCS and Wipro as Leaders in all five quadrants. It names Capgemini as a Leader in four quadrants and EY as a Leader in two quadrants. Atos, LTIMindtree and Prolifics UK are named as Leaders in one quadrant each.
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