The year 2022 has been promising for the U.S. oil and gas industry. It has experienced record growth, and the outlook toward 2023 is quite positive. In addition, the sector has sufficient funds to execute its planned strategies. However, 2023 is going to have challenges.
The coming year may involve challenges with respect to price volatility and supply disruptions. Of course, the industry has always faced these challenges. However, the present situation is quite exceptional as several aspects, including financial, geopolitical, economic, and trade, get involved, and trigger a readjustment in the broader energy market.
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The other constant challenges include reducing expenditure on operations, ensuring workplace safety, and making sure that the industry, as a whole, adheres to regulatory compliance.
The incorporation of technology is going to be critical for the 2023 oil and gas industry to stay ahead of the challenges and tackle them in the most possible way.
Incorporating technology into the critical features of the industry requires exceptional technical knowledge. However, surveys indicate that the industry’s top leadership often lacks technical expertise. (EY GISS Sep 2021).
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This holds true for a significant part of the top leadership in the current oil and gas industry. It is not a total absence of technical expertise but the presumed inability to interpret technical challenges with respect to the new or non-traditional scenario.
Top executives are typically seasoned professionals with years of experience in the conventional oil and gas sector. They clearly understand the risks and challenges across the traditional chain of values. What is absent here is information security with respect to non-conventional markets.
The IT security options that the current oil and gas industry requires are beyond basic IT requirements and much more complex and technical. While entering into new domains, the knowledge gap turns evident. Also, they need to get accustomed to everyday changes in how businesses operate at a digital level.
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There are instances wherein oil and gas businesses have to roll out innovative technologies to timescales. Often, there needs to be more time to assess the technology suitably. Without upgrading themselves, industry experts will face adverse consequences in supporting technology-oriented initiatives.
The nature of technological investments has altered considerably in recent years. Earlier, IT investments were constrained to a centralized and enterprise setting. However, with the merger of OT and IT, effective governance becomes arduous as the network is much more extensive and there is a vast network of partners.
A cyberattack can cause severe consequences as the safety of humans, and the environment is not assured. The probable threats could be of minor or severe impact. There could be ruptures, spills, the release of chemicals, and so on. Therefore, cyber security turns critically essential for the oil and gas sector. Lack of adequate exposure to new technologies and their implementation in such a way that maximum benefits are derived can negatively impact the management’s approach, and the expected yield can be less than what it could be.