12/10/2018
ABU DHABI, UAE – The Abu Dhabi National Oil Company (ADNOC) has announced its successful collaboration with IBM, piloting a blockchain-based automated system to integrate oil and gas production across the entire value chain . The revolutionary system provides a secure platform for monitoring, validation and execution of transactions at every stage, from the production well to the final customer.
According to ADNOC, the use of blockchain technology will reduce the time it takes to execute transactions between ADNOC's operating companies and will significantly increase operational efficiency across the entire value chain. Furthermore, it will improve the reliability of production data by allowing greater transparency in transactions.
The industry leader project was announced by Abdul Nasser Al Mughairbi, director of the ADNOC digital unit, at the recent World Energy Capital Assembly in London. At the event, ADNOC shared its ambitions and early successes in incorporating Blockchain and other advanced technologies, including Artificial Intelligence, throughout its business to improve operational efficiency, generate profitability and unlock new value from oil and gas resources to seize the opportunities created by Oil and Gas 4.0.
At Mughairbi he said: "We believe this could be the first application of the blockchain in oil and gas production accounting anywhere in the world, demonstrating how ADNOC is leveraging innovative partnerships to unlock the power of technology and creative thinking for improve efficiency and offer better performance.
"Blockchain is a turning point, it will substantially reduce our operating costs by eliminating time-consuming and labor-intensive processes, by strengthening the marketing and trading of our products and creating long-term sustainable value that will ensure ADNOC on its strategy smart growth 2030 ".
The ADNOC pilot blockchain provided a unique platform that tracks the financial amounts and values of each bilateral transaction between the ADNOC operating companies, automating the accounting process. For example, while crude oil makes its way from the production well to the refinery or export terminal, all quantities are accounted for on a daily basis together with the associated monetary values. Other products included in the blockchain application are gases, condensates, liquids for natural gas (NGL) and sulfur. These products are exchanged between the operating companies of ADNOC and exported to customers abroad.
Zahid Habib, IBM's VP for chemical and petroleum solutions, said: "With this pilot project, ADNOC takes a huge leap forward in asset availability and financial assets, which, in the simplest terms, allows you to trace every irrefutably petroleum molecule, and its value, from good to customer, which unlocks the potential to digitally reinvent the ADNOC hydrocarbon value chain, adds a unique dimension to the visualization of data in the Panorama Digital Command Center and accelerates the # 39; ADNOC towards their 2030 Vision. "
As the Blockchain application is expanded, it will eventually be connected to customers and investors, providing seamless integration between the parties involved. This greater clarity and transparency will reduce the inherent business risks and consequently increase the attractiveness of the ADNOC group as an investment partner.
Blockchain is a shared ledger that can record transactions between a network in an efficient and verifiable and permanent manner. The information is stored in blocks and once registered, the data in a given block can not be changed retroactively without any modification of all subsequent blocks, which requires the consent of the majority of the network. This allows participants to verify and control transactions independently and relatively inexpensively.
At ADIPEC 2018, ADNOC announced that it is focusing its efforts to harness the energy resources needed to enable global economic growth in the 4th industrial era, an era where digital innovation is offering unprecedented levels of prosperity and drives the demand for oil and gas. ADNOC is gearing up to meet this demand and, through creative collaborations, seize the opportunities for Oil and Gas 4.0.
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