Table of contents
- Introduction and Opportunities in the Oil and Gas Industry
- Top 7 Challenges in the Oil and Gas Industry
- Suggested 7 Solutions to overcome Challenges
Opportunities in the Oil and Gas Industry
“A reliable and competitive Oil and Gas Industry is critical to a healthy economy.”
Globally, the demand for Oil is increasing and it is expected to grow for many more years to come (see the chart below).
So, as you see there are a lot many opportunities for revenue growth coming up in this sector but few micro and macro challenges affecting the industry.
“Uncertainty is the key characteristic of the Oil & Gas Industry today.”
As people are finding ways to be more dependent on the organic sources of energy, Oil and Gas Industry is coming across a lot of technical, operational as well as organizational challenges.
The Top Seven challenges are listed below:
- To produce crude oil and refined industrial products at the lowest possible cost to remain competitive.
- The industry is facing the challenge to ensure that their plants have no unexpected shutdowns.
- Onboarding and retaining the best talent in the workforce are also part of the critical challenges that the industry is facing where the most experienced workers are about to retire in the coming five to seven years.
The graph presents the labour force survey data specific to the Oil and Gas Industry from Statistics Canada)
- Operational Excellence is about driving value and getting a decision maker’s approval on commitment towards process excellence is also one of the biggest challenges.
- With the government policies limiting carbon emissions, this industry is struggling to find out ways to improve the processes which reduce the environmental impact and meet stringent standards.
- Ensuring workplace safety is a Security challenge in this market which is regulated by strict legislative frameworks.
- Changes in Consumer Preferences and greater competition from alternative energy products pose another threat.
By implementing the right solutions in response to the above-mentioned challenges, the Oil and Gas Industry can continue to prosper.
7 Solutions to overcome challenges
Below are seven suggested solutions for the industry to come over the challenges:
- Work on improving the efficiency of industry operations.
- Improve performance results by maximizing value creation.
- Attract skilled human resources to fill the gap and develop a robust training and development program to retain the workforce and improve its performance.
- Find out ways to fight climate change and reduce environmental impact.
- Return a fair share of the wealth to the society and local communities.
- Usage of best technological solutions like video systems and cybersecurity to overcome security challenges.
- Perform ethical business practices and be regulatory compliance.
In the coming few years, a lot of new technology trends and innovations are expected to flow from the upstream sector (exploration and production) down to the midstream refinery operations, infrastructure, and petrochemical facilities.
Hence, with the development and deployment of technological solutions and practising social responsibility in operations, there is a huge opportunity to boost investments, minimize risks, and reduce costs in the Oil and Gas Industry.