_58686.jpg "Oil & Gas Condition Monitoring Systems Market Forecast")
Heavy duty pumps, compressors, pipelines, storage tanks and other countless components power the flow of oil and gas from underground and undersea reserves to industries, and even our homes and offices. When things are taken care of regularly, everything goes right. But when a single check-up is missed and something goes wrong, potential hazards, be it large-scale explosions or leakages of fluids and gasses, are likely to happen.
Providing a safe and regulated environment at such critical spaces becomes the foremost responsibility of any industrialist. In oil and gas industries, when machinery breaks down or downtime occurs, the industrialists have to face many consequences, including:
Did you know that unplanned downtime each year costs around $35mn-$40mn to an average oil and gas industry?
Monitoring for Oil and gas industries can improve their functioning and serve as a handy tool for the site’s predictive maintenance, saving a huge amount.
Manual monitoring or Condition Monitoring?
Initially, industries relied on manual health checks or scheduled maintenance checks to enhance productivity. Facing a shortage of workers, and life risks, industries started opting for improvised solutions to meet demands with desired results. The focus, thus shifted to automation – Condition Monitoring.
As the name implies, condition monitoring (CM) is a procedure that monitors and predicts any machine's safety and functionality. It uses a variety of techniques, including vibration analysis and thermography, to aid the detection of mechanical issues and provides early warning of flaws and potential damage.
Condition monitoring systems (CMS) help in improving plant operations and decision making, due to which, there is an uprise in their adoption in several industries like aerospace & defense, automotive, oil & gas, marine, metal & mining, and others.
Compared to all other industries, the maintenance expenses are much higher in O&G industries, owing to unplanned shutdowns due to the frequent failures of the associated machines/equipment/system.
In 2021, the global condition monitoring system was valued at US$ 2.7 Billion. Oil & Gas accounted for ~36% of this value in 2021.
Some of the cases where condition monitoring system is leveraged are:
Elements of Condition Monitoring process –
A CM system consists of the following 4 elements: (refer to fig.1)
The mentioned system provides critical alerts which are sent immediately to the respective personnel, and the gathered real-time data is accessed in order to take actionable decisions.
Condition Monitoring Techniques
The most common techniques used for gathering real-time data through a condition monitoring system are listed in the table below.
Condition Monitoring Serves Several Benefits
Here are some of the advantages that ‘oil and gas’ industries can attain from the data collected through condition monitoring systems (CMS)-
Money saved is Money earned
On an average, an oil and gas company goes through an unplanned downtime of at least 25 days each year, costing approx. US$ 35 million.
Estimates suggest that the US refineries lose ~$6.5 billion because of unplanned downtime and poor equipment maintenance. Condition monitoring takes this cost pressure off the oil and gas companies to a good extent.
In the previous section, we talked about the benefits of condition monitoring. The supportive data is equally exciting too.
Owing to such offerings, most companies are investing in condition monitoring systems in order to save downtime or maintenance charges. The more they invest in monitoring process, the more money they will be able to save further.
Condition Monitoring in Well Services
During the production, the oil wells are subject to extreme conditions including high temperatures and pressure. As a result, well servicing is the most critical element not only for safe and continuous operations, but also for extended life of these wells.
Throughout their lifespan, the well equipment faces several issues. One of the main problems is sand production. Sand clogs the performance in the well. It causes erosion damage of the equipment, and even collapse of the reservoir.
Operator closes choke valve (a valve that controls the flow) from 20% to 75% to limit the sand production, that results in reduced oil and gas production and reduced revenue.
Similarly, corrosion in machineries also causes loss to the industry. Due to exposure of metals to certain chemicals during drilling operations, corrosion is common in machineries.
According to the United States Cost of Corrosion Study, produced by NACE International, corrosion costs the US oil and gas exploration and production industry US$1.4 billion a year. Downhole tubing accounts for a third of this amount. Industry experts suggest that 30-40% of this cost can be prevented by taking right measures, including predictive maintenance.
Some of the other common problems which can be addressed through condition monitoring in Well Servicing include –
Why monitor Wells using CMS?
The U.S. Energy Information Administration estimates that the total cost of a well falls around $4.5 to $8.0 million. Now, that is considered as ‘secondary costs’ (not actual cost of the oil well) such as land acquisition and capitalized drilling. But any small or big mishap can cost much more than the amount one has invested in the well construction. The loss can include downtime costs, repair costs, and even shut the entire process down.
Safety and security of the wells and well equipment protects workforce, the equipment, and also the investment. And to maintain safety, one needs to monitor every single machinery used in the entire oil and gas extraction process.
Some of the equipment that need monitoring include:
The Market Condition of Condition Monitoring Systems
The growth in oil rigs indicates the growing demand of oil and gas consumption. From July 2021 to July 2022, there were more than 390 additional rigs globally (>1770 rigs in total). The U.S. owns more than 750 rigs, out of these 1770 rigs, whereas the second largest oil producing region – the middle east owns around 300 rigs.
IEA states that the global oil demand is rising gradually and is expected to rise by 3.3 million barrels/day in the year 2022. With these numbers growing, it is quite obvious that the demand for digital/ real-time condition monitoring systems will also rise. According to Stratview Research, the demand for oil & gas condition monitoring systems will cross a value of US$ 1,300 Million by 2027.
What does the future hold?
The oil and gas industry has taken a path of digitalization of operations and processes to improve efficiency and profitability. Though these systems may demand a big capital outlay, but the returns in terms of savings and efficiency enhancement are even bigger in the long run.
For instance, IoT solutions can improve production by 25%, reduce maintenance costs by 30%, and equipment downtime by 45%. That’s why oil and gas biggies such as ExxonMobil, Shell, BP, and Chevron are already exploring technologies powered by AI and IoT, such as predictive maintenance, to cut costs and improve efficiency.
And it’s just a matter of few years from now, when these next-gen technologies will make their way to the mainstream in oil and gas industry.
Authored by Stratview Research and originally published on OGNnews
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