Later this month, OPEC nations will meet to finalise an agreement to cut production by two per cent which is opposed by Iran and Iraq.
Speaking at the Abu Dhabi International Petroleum Exhibition and Conference (Adipec) Shell’s Vice President for IT, Alisa Choong signalled the company will look to technology to reduce costs and the impact of stagnant prices. Market analysts predict prices will not rise beyond $70 per barrel until 2018.
“Costs can come down quite significantly, but the minimum improvement we’re looking for is 25 per cent,” Ms Choong said.
Shell has announced it is investing US$1 billion a year in research and development and allocating a greater proportion to knowledge and data systems.
“Due to the world that we live in being so connected, there’s so much more data that needs to be analysed and decisions that need to be made at a faster speed,” said Ms Choong.
The market is demanding a change in the way the oil industry is performing, and IT may go some way to meeting that demand.
The McKinsey consultancy group has said that an oil and gas company could save nearly to US$1 billion a year or 20 per cent in capital expenditure through digital technology alone.