The computers in the offices of the average big oil company can find an additional $1 billion in value, if you let them. Modern advanced-analytics programs are able to diagnose, sort, compare, and identify cost savings, or opportunities for increased production, in a manner beyond the capabilities of the average employee. The tools have been available for several years, but adoption has been slow. This is partly the result of the recent crash in oil prices, but competing internal IT projects and reluctance to put in the effort required are also factors…
A super-major drilling horizontal shale wells in North America found that its costs, as well as those of its competitors, varied highly across plays. The company assembled a data team and collected information from finance, operations, competitor investor presentations, and industry news stories. A software program did bottom-up analysis, churning through millions of records. At the end of this multiweek process, the team could confidently propose critical changes to casing design, procurement, and casing crew selection. The savings came to $700,000 per well. As this company had about 1,300 future wells to drill, the total potential was $910 million—not quite a billion, but awfully close.
From: ‘A billion-dollar digital opportunity for oil companies’