Artificial Intelligence in Oil and Gas Industry: Remarkable Transformation

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Artificial Intelligence in Oil and Gas Industry: Remarkable Transformation

Using AI or artificial intelligence in oil and gas industry helps analyze historical and real-time data, run analytics, plan and schedule production, optimize the supply chain, and use resources to increase returns. Let’s learn more about how artificial intelligence impacts the oil and gas industry operations. 

The oil and gas industry falls among the prominent industries in the global market. As enterprises and companies from other sectors adopt new technology, it’s noteworthy to mention that the oil and gas industry is not lagging behind. Artificial intelligence is playing an important role in streamlining the on-field and off-field activities in the oil and gas industry. 

Whether it is using AI tools for oil production, transportation, or improving the safety standards at work, artificial intelligence and machine learning are helping companies solve challenges in various areas. 

The Middle East produces one-third of the world’s oil and is among the biggest suppliers of fossil fuels. This is because the largest oil reserves are found in the Middle East, thanks to the geographic changes that occurred over the centuries. Most of the oil-producing states in the Middle East come under the Organization of the Petroleum Exporting Countries (OPEC). 

Statistics show that around 39% of the crude oil produced by OPEC countries comes only from the Middle East region. In fact, Saudi Arabia is the largest producer, with more than 12.2 barrels of production per day. Moreover, the Middle East region accounts for 48% of proved oil reserves, 40% of proved gas reserves, and 18% of the global gas production. 

What role do AI and ML have in the oil and gas industry, especially in the Middle East? How can the global oil and gas companies use artificial intelligence applications to revamp their systems and increase returns? Let’s read to know the answer. 

How is Artificial Intelligence Used in the Oil And Gas Industry?

Managing capital and investments, attracting shareholders, and increasing operational efficiency are some crucial aspects to consider. The role of artificial intelligence is to help oil and gas companies overcome their problems with exploration, production, processing, logistics, and to streamline backend (or office end) services. In short, AI is used in just about every stage in the energy and utilities industry. 

Uses of AI in the Oil & Gas Industry
Uses of AI in the Oil & Gas Industry

Exploring and Producing 

AI is used to forecast the reserve volumes that can be recovered, analyze the reservoir data, help create well-developed plans on the field, choose production models based on advanced analytics, and make decisions based on market trends and changes. 

Drilling and Refining 

From designing to execution of drilling, artificial intelligence helps oil and gas companies to find ways that optimize the returns. Risk prediction, daily, monthly, and lifetime production forecasting, detecting defects and anomalies, etc., are done using AI and ML systems. 

On-Field Equipment & Services 

Artificial intelligence assists the on-field managers and workers in scheduling drilling activities and optimizing fleet management and supply chain. Equipment maintenance, improving workplace safety, and forecasting consumer demands are done through the latest AI systems and tools. 

Office Software 

AI plays a role in many areas beyond the ones where major action occurs. The backend and corporate offices also use AI and ML to empower employees with automated software to increase productivity. The top management makes decisions based on the reports generated through AI applications. 

How Will Artificial Intelligence Impact Upstream Oil and Gas?

Globally, the oil and gas AI market is valued at $2 billion in 2019. Statistics show that it is estimated to touch $3.81 by 2025 at a CAGR (Compound Annual Growth Rate) of 10.96%. Machine Learning and artificial intelligence in the oil and gas industry are being used for data interpretation and analytics to help forecast future trends, discover new reserves, and increase production in existing reserves. 

While AI, IoT (Internet of Things), and cloud-based technology are gaining acceptance in the oil and gas sector, the lack of professional expertise is slowing down the adoption rate. The oil and gas companies have to hire AI professionals or train their senior employees to use AI and ML tools as a part of their day-to-day work. 

Generally speaking, the focus of global oil and gas companies is on simplifying and streamlining the exploration and production processes using AI. Digitalization, automation, and data analytics can help companies improve their operations while aligning their goals to the market trends. 

Learn how AI can take your oil & gas business to the next level

The Growing Role of Artificial Intelligence in Oil and Gas Industry

The Oil and Gas Authority (OGA) has begun using artificial intelligence in 2019, thanks to the National Data Repository (NDR) in the UK. The pandemic has caused a slump in the industry in 2020 (oil prices decreased by about 50% during the lockdown). However, many companies have been actively investing in artificial intelligence to: 

  • Automate initial stages of exploration & production 
  • Design AI robots for ocean exploration 
  • Enhance natural oil detection capabilities 
  • Increase productivity 
  • Reduce risks 
  • Minimize operations costs 
  • Streamline supply chain 
  • Maximize ROI on drilling activities 
  • AI-based sensors in oil fields 
  • Mobile integrations to share updates with on-field workers 
Benefits of AI in the oil & gas industry
Benefits of AI in the oil & gas industry

It’s no surprise that early adopters have the advantage of protecting their assets and attracting more investors. The early adoption of artificial intelligence in the oil and gas industry is delivering similar results as with other industries, i.e., empowering the companies to retain their market positions and expand their share by gaining a competitive edge over others. 

Applications of Artificial Intelligence in Oil and Gas Development

Geological Assessment 

Geological assessment is also known as surface analysis, where AI robots can detect oil seeps and reserves deep inside the earth or the ocean. The Wadia Institute of Himalayan Geology (WIHG) came out with a new AI technique in 2020. This technique helps analyze data from semantic waves and helps discover the presence of hydrocarbons (like oil and gas) with minimum effort and in quick time. AI tools analyze and assess geophysical data to increase accuracy in mapping the natural oil deposits. 

Tracking Assets 

Asset tracking and management include project planning, managing the product lifecycle, and aligning the process to match the market demands. Digital twin technology is being used by the oil and gas companies to deal with the uncertainties in the market (especially due to the pandemic) and to add more flexibility to their system and approach to work. 

Automating Equipment Maintenance

A vital role of artificial intelligence applications in the oil and gas industry is to reduce equipment downtime and reduce the risk of losing millions of dollars due to faulty machinery. A report by the World Economic Forum stated that a whopping 92% of the refineries had to be shut down due to unplanned and improper machinery maintenance. Artificial intelligence applications can automate equipment maintenance and alert the supervisors about any possible defects or malfunctions. Preventive maintenance goes a long way in reducing machinery revival time and ensuring greater operational efficiency. 

Tracking Emissions 

The increasing awareness about climate change and carbon footprints has made many oil companies revamp their processes. The McKinsey report says that various oil and gas companies set net-zero emission targets for themselves. Using artificial intelligence applications to track their carbon emissions and find solutions is the best way forward to deal with climate change. 

Detecting Defects or Quality Assurance 

Defective pipelines, equipment, and processes can push an oil and gas company into losses and closure. The Application of artificial intelligence can be used to resolve defects at the end of the production line (caused by the upstream issue). AI tools can be used to detect defective systems well in advance. Combining this with predictive analytics will give the company enough information to be proactive in managing the pipelines and production cycles. 

Optimizing and Scheduling Production 

Exploration, drilling, production, and refining are interdependent processes. AI tools help plan a comprehensive strategy to streamline the stages to minimize the use of resources and maximize returns. Many oil companies hire offshore AI professionals to assist them with scheduling the activities on the field and implementing their plans to perfection. 

Workplace Decision Making 

Corporate oil and gas offices, including the backend operations, use artificial intelligence to make day-to-day and long-term decisions.

Offshore AI solutions providers integrate the latest AI tools to run advanced analytics and generate reports in real-time. These reports are used to make decisions about the on-field, supply chain, marketing, and financial activities of the company. 

Logistics and Transport Management 

Logistics and transport in the oil and gas sector are complicated. There are too many nodes or decision centers to consider from start to finish. AI helps midstream businesses through planning and executing transportation services. In the upstream business, artificial intelligence helps teams coordinate and align their operations to reduce the time taken for shipping. 

On-Field Worker Safety 

Working in the field amidst heavy machinery is a life-threatening job. However, several workers, supervisors, technicians, managers, etc., spend hours of their time on the field. Artificial intelligence and IoT sensors can help collect and send valuable information to the systems to alert workers and prevent workplace accidents. Deep learning systems help the teams to identify weak areas (or the ones where the safety norms have been violated).

Procurement and Process Optimization 

Artificial intelligence applications help oil and gas companies build interconnected digital supply networks (DNS) and increase flexibility in their processes and systems. From automating the purchase-to-pay process to identifying bottlenecks in the procurement and production lifecycle, AI-based tools can provide an effective solution to complex problems in the company. 


Oil fields with sensors are already proving to be an asset for oil and gas companies. Artificial intelligence will continue to become an integral part of the industry as more companies adopt the latest technology in their offices and field locations. Various oil and gas companies from the Gulf region began stage-wise investments in artificial intelligence to streamline their processes.

Oil and gas companies can easily overcome the lack of technical expertise by hiring the services of offshore AI professionals to integrate AI software with their existing systems. AI in the oil and gas industry can increase production and returns for the company.  

Revamp your oil & gas business with Artificial Intelligence

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