Asset Management in Oil & Gas Industry: The Complete Guide

Mar 03, 2022
What is Asset Management Process?
Asset management is a complete process that involves handling, developing, operating, maintaining, and sourcing organizational assets by improving productivity and reliability throughout their lifecycle. The asset management team looks into optimizing opportunities, supply, and demand of resources with a collective interest of minimizing costs and performance of assets.
Sanjay Bajaj
Sanjay Bajaj

Former SVP & Global Delivery Leader

Energy & Utilities


Ganesan Karuppanaicker
Ganesan Karuppanaicker

Vice President, Global Delivery Head

Digital Transformation


Asset Management in Oil and Gas Industry
Both Oil and Gas are in-demand and high-functioning assets as they are commonly required across multiple industrial sectors. It is highly exhausting to maintain a steady scale of operations, from procurement to selling. Also, dealing with wide and diverse networks involving disparate facilities and production scale is entirely factual depending on industrial assets.
Market dynamics change with time, and industrial operations infused with asset management allow to predict and overcome problems, effectively increasing operational efficiency and addressing all key issues of oil and gas companies. Market turbulences can also affect the assets; thus, a well-designed asset management plan with all resources in hand along with a supply chain renders important in analyzing exposure and minimizing failure.
Trends in Asset Management in the Oil and Gas Industry
Global markets are in constant turmoil adjusting to regional governance issues and market valuations. A local production oil and gas supply is lucrative and could attract international buyers and boost production to meet the growing demand. The global markets also witness an increased surge in demand for refined products from petrochemical industries.
Intelligent data-driven devices are helping implement smart production and utilization. Now oil and gas industries are extracting data to help understand and improve business operations and improve revenue streams.
Stay Ahead
Visit our Energy & Resources page
What is Asset Management in Oil and Gas?
Asset management plays a pivotal role in the oil and gas industry, ensuring that operational costs are kept marginally low. The entire industry is dependent on a system that connects all blind spots and communication gaps between suppliers and stakeholders. An asset management system helps increase visibility over all operations improving uptime and performance of assets. Moreover, the increased impact of greenhouse gas emissions from active operations has driven the need for implementing asset management solutions.
The industry operates on a complex architecture where strategic investments and project management processes are of paramount significance to maximize the value of oil and gas throughout its lifecycle. A sound asset management solution helps mitigate operational risks by enhancing collaboration and performance of individual and overall assets, generating a much higher outcome from initial investments.
It enhances collaboration across multiple enterprise functions, with intelligent predictive analysis helping to avoid potential failures, in turn reducing downtime, eliminating the possibility of asset wastage, and curtailing additional productional activities.
Asset Management in Oil & Gas Industry: The Complete Guide
The Need for Asset Management in Oil & Gas Industry
The industry is struggling over time based on increasing overhead operational costs and lapses in the supply chain. With an asset management plan in action, the solution can reduce downtime, increase production without exhausting machinery, prolong machine life, improve asset utilization, and, more importantly, help reduce costs.
Lower Equipment Downtime
Predictive maintenance is a key asset management feature, with timed intervals dedicated to repairing and monitoring equipment. Updating maintenance practices driven by digital technology diverts active efforts in reducing unplanned downtime and leading towards better operational efficiency.
Scheduled repair cycles bring down the hidden and labor costs, reducing the impact on industries. Instead of waiting for the equipment to break down, asset management improves predictability by ensuring all assets are proactively taken care of.
Asset Management in Oil & Gas Industry: The Complete Guide
Better Inventory Control
With inventory visibility, industries can handle stock effectively by tracking and controlling it, avoiding a situation where a unit is overstocked or understocked. Spare parts that go into production and drilling operations are expensive and hard to manage; with asset management, part availability is increased with minimum inventory investment.
With serialized tool tracking, mobile storage containers and safety compliances ultimately reinforce a habit of productivity and accountability. Introducing a policy for managing and handling deliverables helps speed up product delivery while maintaining quality and safety.
Asset Management in Oil & Gas Industry: The Complete Guide
Improved Resource Management
Get a demand forecast based on the current utilization of resources and assets. With the current inventory allocation, the system prepares a list of required assets that must be prepared to fulfill future orders. Asset management also organizes the onboarding process of assets to ensure it complies with policies and practices. It helps create an analysis based on the demand and supply gap and identify assets that are easy to allocate regularly with low costs.
Cost Savings
Against the backdrop of streamlining operations, maintenance, and asset allocation, the main motive is to enhance operational efficiency. These solutions improve the overall uptime and performance of assets, also improving the life expectancy of equipment. Asset management strategy insulates industries from market volatility by optimizing operations and reflecting long-term profitability.
Efficient product usage, theft prevention, easy identification, and asset condition monitoring helps bring down additional costs and refine processes.
Regulatory Compliance
Any oil and gas industry must comply with relevant laws and regulations to ensure a smooth business operation. As operations increase, the compliance demands catch up with the regulatory changes that one incurs from streamlining their processes.
An asset management system helps keep track of workflows with regular audits, databases, compliance documentation by automating these tasks and offering ease in monitoring. Centralize your regulatory compliance efforts with an asset management system as the space is constantly evolving to modify strategies based on requirements.
Improved Production
Using an asset management system with predictive maintenance solutions gives companies the ability to intelligently interact with all their resources in the supply chain, access and analyze gaps, and prevent problems or failures before they interfere with production.
Asset management allows you to effectively address all key priorities of oil and gas companies, increasing operational efficiency. It contributes to continuous improvement if the performance of an asset is optimized, and if it performs correctly without any problems, the performance will increase and lead to better production.
Asset Management System in Oil and Gas Industry
Oil and gas companies own or lease various physical assets such as pipes, crossings, downhole equipment, pressure control equipment, logging equipment, storage containers, and other field equipment. Consequently, resources are very important not only for day-to-day operations but also for business.
This is a major challenge for moving industries such as oil and gas, where real-time monitoring of the location, performance, and safety of all assets is critical to streamline processes, eliminate downtime, reduce costs and minimize environmental impact. With the help of a system, one can track asset maintenance history, asset movements, etc. It becomes a complete control system that ensures safe and reliable operation over the asset's entire life cycle.
How to select the right system?
To identify the right system, it is important to understand the objectives and expectations derived from the current outcome of the industry. Managing such diverse resources in many places is a tedious task. The processes used to manage resources must be coordinated to find the optimal process with cost, risk, and performance throughout the life cycle. Oil and gas companies need to use proactive methods to streamline the system and check compatibility that has the best outcome with the product vertical.
Examples of Asset Management in the Oil & Gas Industry
Fleet Management
Oil and gas companies in diverse and demanding conditions require fleet management and regular maintenance to minimize breakdowns. With vehicle tracking, optimization, scheduling, and overall effective utilization of resources, automated reports and insights over fleet operations and increased labor safety.
Process Optimization Through Maintenance Data
Based on historical data and performance metrics, the analytics collected can identify the root causes and failure-causing parameters. Based on the framework asset management system builds a foundation and works to deliver an end-to-end solution that is completely accurate and simplifies process management.
Predictive Maintenance
The key element of asset management lies in increasing asset shelf life while minimizing expenditures that involve downtime and spare parts replacement. It improves product reliability and increases plant efficiency increasing revenue and avoiding unplanned shutdowns. Predictive maintenance is beneficial in reducing environmental impact; it also helps maintain an operational focus for maintenance staff to stay aligned and integrated into the system.
When introduced in the oil and gas industry, asset management strategies can potentially bring down operational costs to around 20-30% marginally, which can further be streamlined to yield better results. The evolution of technology has framed an optimum positioning for oil and gas companies to upgrade and incentivize their operations with automated systems. With time, it will be an integral part of the system to ensure each asset and operation is accounted for and reliable throughout its lifecycle.
Was this article helpful?