The Future of Oilfield Logistics

MIDLAND, Texas - July 31, 2015 - PRLog -- In 2013, the oil industry brought in 17.5 billion in revenue and was the fourth most valuable industry in the United States. The industry can continue to contribute its success through the implementation of new technologies in the field.  Drillers are using automated rig equipment to drill wells faster such as the Iron Roughneck.  Directional drilling companies are competing to provide the most durable mud motors to increase the Rate Of Penetration.  Exploration and Production companies are using advanced technology to extract oil and gas from extreme depths with success.  SCADA systems are capable of processing more data while providing solutions at the wellhead. All in all, E&P, contractors, and service companies are adopting advanced technologies to improve the state of the industry.  However, there is one particular sector that is suffering from the lack of innovation.

Upstream oilfield logistics is in a stagnant state and it is affecting the industries bottom line.  Now, I may add that the transportation advancements are being utilized in the oil industry.  For instance, drivers are using digital logs, top-of-the-line GPS trackers are providing location data every second, and dispatching software is becoming more integrative.  While these products may be helping companies on a vertical scale, they are not making major impacts on transportation efficiencies.  Optimizing oilfield logistics has to be conducted on a horizontal scale while integrating each supply chain.

We have seen dozens of companies develop proprietary software to innovate scheduling and dispatching processes.  Their whole platform is digital, which means their drivers and coordinators are using digital shipping tickets and real-time tracking software.  These advancements create great transparency of their operations for their customers to monitor.  However, the software is only available for those companies who can afford it. The software is only benefiting the trucking company and its customer even though there are several suppliers in between that lack knowledge of the operation.  This results in repeated failure in the oil industry.

Transportation of supply chains to and from job sites account for over a billion dollars in revenue per year.  It is an integral process that propels the industry.  Properly executed oilfield logistics can save operators and service companies valuable operating costs.  Revenues will rise and downtime will diminish.  It is astounding that logistics have not been a primary focus to optimize workflows in the oilfield.

There will be a company that leads the way to accomplish complete logistical efficiency in the oil industry.  The company must innovate horizontally instead of vertically.  Proprietary software catered to one company will not transform the industry.  In order to drastically change operations, every company must be using the same technology.  Their employees must be integrated into the platform to control and manage their assets being delivered to their customers.  There will be full transparency of operations in which operators and suppliers will track shipments in real-time.  Each load will be streamlined and automated so drivers simply have to drive and handle equipment.  Locating wells and rigs will no longer be a complicated task.  All of which will be conducted on users phone and computer devices.

Like any other industry, improving operational efficiencies is critical to the health of oilfield. With the volatility of oil prices it is imperative that operational tasks be executed swiftly.  There is no reason this advanced industry cannot improve its logistical processes.