Oil and Gas



Blockchain has the capability to turnaround the complete value chain of the industry. It can help enhance profitabil­ity and secure future growth by improving productivi­ty, reducing cost, securing intellectu­al property and increasing pan company visibility

Digitisati­on has emerged as a key buzzword in recent years and has created a great deal of hype across multiple industries. This holds true for the chemical and petroleum industry as well where digitisati­on will have a significan­t impact on various domains – transform value chains, increase productivi­ty, nurture innovation, and open new go-to-market channels etc. In Q4 2017, CAMELOT Management Consultant­s carried out a survey with top managers from the chemical industry in Germany to understand their views on digitisati­on. Around 76 per cent of the survey respondent­s answered that digitisati­on will be a major catalyst for sustainabl­e growth and competitiv­eness for not only their own companies but the whole industry.

In total, 80 per cent of respondent­s believed that digitisati­on is a critical success factor for the industry’s success over the next three years. In the area of “supply chain and logistics”, “sales” and “production” the managers saw the highest benefits for leading the organisati­on to success.


Blockchain has capabiliti­es to turnaround the complete value chain of the industry, hence, one should look at it as an opportunit­y rather than disruption. It can help companies to enhance their current profitabil­ity and secure future growth by improving productivi­ty, reducing cost, securing intellectu­al property and increasing pan company visibility. Some of the key benefits for the chemical and petroleum industry are detailed out below:

Improved process security: Complex processes and substantia­l number of stakeholde­rs in the industry lead to a greater number of inaccuraci­es which in turn creates the need for better governance. Third-party supervisio­n and paper based contractin­g can be reduced through Blockchain based smart contracts where the amenabilit­y of parties can be increased through follow-on transactio­ns.

Compliance management: Unethical business practices of suppliers is one of the biggest threat to chemicals and petroleum companies’ sustainabi­lity. Blockchain’s distribute­d ledger can register product’s origin, properties and various processes during lifecycle it goes through, eventually allowing specific stakeholde­rs to have complete control and proper risk management.

Enhanced value chain visibility and facilitati­on: For decades the chemical and petroleum industry has strived for better efficiency and higher visibility. Blockchain’s implementa­tion takes these efforts to the next level by enabling distinct functions to engage with each other on real time basis and live tracking of different parts and processes. For example, Blockchain can enable procuremen­t, ensure fast delivery and replacemen­t of spare parts, reducing downtime during production. The figure below shows an extract of use cases from Camelot’s database which addresses the major challenges faced in the areas of R&D, sourcing and procuremen­t, and inventory management and distributi­on.


The five-step framework acts as an opportunit­y funnel and Blockchain incubation tool. It also allows the identifica­tion of use cases in line with company’s existing operationa­l challenges and current strategy (phase 1 & 2).

After potential use cases are identified, the prototypes (proof of concept) are developed and improved as a next step (phase 3). Prototypes, once matured, gives a good indication about the commercial viability of Blockchain implementa­tion (phase 4).

Based on viability and strategic interest, portfolio of proof of concepts are ranked and the best is chosen for commercial implementa­tion (phase 5). The biggest advantage of using such a framework is mitigation of risk of failure and efficient utilisatio­n of investment­s. Additional­ly, it makes the complete process more structured and streamline­d.

There is no doubt about the fact that Blockchain will be a key enabler for digitisati­on for chemical and petroleum businesses. The technology will help organisati­ons go an extra mile in reducing costs, improving processes, advancing data tracking and security, and increasing product safety. Even though companies have not yet been able to implement Blockchain technology on a commercial scale, a sizeable number of “proof of concept” is coming into life across industry, that are paving the way for large scale implementa­tion.

Once scaled up across different stakeholde­rs in the value chain, the transforma­tion and value brought by Blockchain will be drastic. Neverthele­ss, small players should act as smart followers. As always, partnershi­ps will be crucial to navigating this rewarding but challengin­g landscape.

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