Necessity of Digital Transformation of Nigeria’s Oil & Gas Sector for Efficiency

Necessity of Digital Transformation of Nigeria’s Oil & Gas Sector for Efficiency

By Nnamdi Odumody

The Nigerian oil and gas industry which is the livewire of the economy needs to embrace digital transformation to increase operational efficiency across its value chain. This is necessary as advances in technology across the globe is affecting oil and gas exploration, production, distribution and marketing.

The following technologies are transforming hydrocarbons:

Artificial Intelligence and Robotics

Artificial Intelligence can help oil and gas exploration companies to discover and predict oil fields with large reservoirs. Through deep learning, image recognition to identify deep reservoir of hydrocarbons, mining will be more efficient. With sensors, oil wells can be monitored remotely while robots can be deployed to the deepest offshore and onshore fields to engage in exploration, production and even products refining in refineries. Through aggregation of real time data in exploration, production, distribution and marketing, performance will be accessed and friction points will be accessed to get them solved.


Blockchain is a secure transaction ledger database shared by all parties. It is a distributed network which records and stores every transaction that occurs in the network, creating an irrevocable auditable transaction history, and holds the potential for all participants in a network to share a system of record.

It will help Nigerian upstream oil and gas companies to track their value chain, from production to distribution and midstream companies, to monitor their operations while downstream companies like the upcoming Dangote Petroleum Refinery and Petrochemical, Nigerian National Petroleum Corporation can utilize it in monitoring operational efficiency at their refineries, petrochemical plants and supply chain.

Petroleum Marketing Companies can use blockchain to verify the genuineness of imported products at the depots before transporting them to their retail outlets or end users. Smart Contracts will create new business models for oil and gas operators, as it eliminates intermediaries since it is an agreement entered into between the seller and buyer, without the need for a lawyer, as it autonomously executes various terms written in that contract. It is highly secure and transparent, reducing fraud which could occur by the buyer of the product.

FutureTech in oil and gas

3D Printing

3D Printing or Additive Manufacturing will help oil and gas companies replace damaged parts, e.g. ruptured oil and gas distribution pipelines for products distribution. It is cheaper and faster than conventional production which will take time.

Internet of Things and Wearable Computing

IoT will help in monitoring oilfield, pipeline products distribution, refinery and petrochemical plant operations as well as logistics operations to achieve efficiency. It enables predictive maintenance in case of disruption which can occur during operations and can also be deployed at Tank Farms to monitor the importation, loading and evacuation of petroleum products while retail stations can deploy smart pumps which will help to prevent problems of cheating in discharge of petrol by manual attendants to customers.

Smart Wearables will help oil and gas companies in the upstream, midstream and downstream sectors to monitor the operations of their employees, in real time, in order to know those who are delivering the most value to the organization.

Augmented and Virtual Reality

Augmented Reality is a technology which relays a physical thing in a digital format while virtual reality is a computer generated simulation of a three dimensional image or environment that can be interacted within a seemingly real or physical way by a person with wearable technology. These technologies can be used in training oil and gas employees on safety measures while on the field, display live 3D data from oil and gas fields which could yield reserves, and refinery or petrochemical plant production floor that could be used in decision making.

All Together

Nigerian Oil and Gas companies need to embrace digital transformation like their counterparts across the globe to solve some of the common problems which they confront. Efficiency in production systems will surely help the Nigerian economy.


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