Digital technology has advanced rapidly within the oil and gas sector. What was earlier considered an optional solution has now evolved into a necessary solution for streamlining the operations and asset management practices of energy firms. In recent years, there has been a surge in the uptake of digital twin technology among multinational energy companies across the globe. Stemming from industrial internet of things (IIoT), it is revolutionising the oil and gas sector by enabling real-time monitoring, predictive analytics, and the simulation of infrastructure such as pipelines, storage facilities and processing plants. It is also helping in enhancing performance and mitigating operating expenses and unexpected downtimes.
Mapping growth
The oil and gas industry stands at the cusp of a digital revolution that promises to enhance productivity, safety and sustainability. The increased global adoption of various technology solutions is driven by the industry’s need to improve operational efficiency and asset performance optimisation. Interestingly, the adoption of digital twin in the oil and gas market has witnessed significant growth in recent years. The global digital twin market was valued at around $7,100 million in 2022 and is expected to reach around $307,000 million in 2030, growing at a CAGR of 60 per cent between 2023 and 2030, as per a report by Credence Research. With organisations adopting digital-first strategies, digital twin is increasingly becoming vital for agility and adaptability across industries.
Best global practices
Several multinational energy companies have adopted digital twin technology, showcasing a global commitment to innovation in the oil and gas sector. In recent years, the digital twin market in North America’s oil and gas sector has seen notable expansion. This success stems from its well-established policy and regulatory framework, which governs the oil and gas sector. TC Energy is a major player in the region, with a focus on natural gas transmission and storage. The company has adopted digital twin technology to monitor its vast network of gas pipelines and storage facilities in various gas sector projects to enhance operational efficiency, asset management, and safety. It has utilised the technology to create virtual replicas of the Keystone Pipeline System, which spans across North America, transporting crude oil from Alberta, in Canada, to refineries in the US.
Chevron Corporation, the second-largest direct descendant of Standard Oil, has implemented digital twin technology in its oilfields and refineries; this has helped the company save a significant amount in maintenance costs. It also plans to adopt this technology for its high-value equipment.
In December 2023, Halliburton, a leading US oilfield services company, collaborated with the Libra Consortium spearheaded by Petrobras, to develop a digital twin for the Mero pre-salt field system in Brazil. This digital twin will leverage asset sensors and 4D seismic models to provide real-time insights into the reservoir, wells and other facilities, enabling enhanced asset operations planning, asset characterisation, and reservoir monitoring and optimisation.
Aramco, headquartered in Saudi Arabia, has taken proactive steps by implementing digital twin solutions in its Hasbah field and aims to expand this technology across its engineering and project management domains. Meanwhile, the Abu Dhabi National Oil Company’s (ADNOC) deployment of this technology for predictive maintenance marks a significant milestone in the industry’s technological advancement. Through a partnership with Honeywell, ADNOC has embarked on one of the largest predictive maintenance projects in the sector. By leveraging continuous online monitoring, machine learning (ML) analytics and digital twin models, ADNOC aims to transition from reactive and preventative maintenance practices to a predictive maintenance approach. This initiative showcases ADNOC’s commitment to innovation and underscores the potential of digital twin to revolutionise maintenance strategies within the industry.
In June 2023, China demonstrated technological advancement by unveiling its inaugural smart floating production storage and offloading (FPSO) platform, which is equipped with an integrated operation system leveraging digital twin technology. This system integrates a plethora of cutting-edge technologies, such as artificial intelligence (AI), edge computing, cloud computing, big data, and internet of things (IoT). Demonstrating its commitment to innovation, China also developed a digital twin of the platform onshore in Shenzhen City, situated 1,000 km away from the actual vessel.
Additionally, the Nyhamna gas processing hub in Aukra, Norway, exemplifies the transformative power of digital twin in an industrial setting. In October 2019, in partnership with Kongsberg Digital, it developed the Nyhamna Dynamic digital twin, a virtual representation continuously being updated with real-time data. This twin has empowered Nyhamna staff to leverage big data insights, optimise work processes, and increase resilience. Within a year, the digital twin facilitated cost savings of approximately $3 million, surpassing its investment costs. These savings stemmed from enhanced work processes and helped bring down IT expenses, leading to improved execution efficiency and optimum energy use, demonstrating the tangible benefits of digital twin in industrial operations.
In the North Sea, digital twin has been instrumental in driving cost savings for offshore projects with savings surpassing Euro 2 million for assets featuring topsides of 10,000 tonnes. Studies indicate that the integration of digital twin and smart data systems could reduce 9-15 per cent of the total decommissioning project costs. These diverse examples illustrate the transformative potential of digital twin in enhancing operational efficiency and driving cost savings across the oil and gas industry on a global scale.
Economic efficiency 
The integration of digital twin is emerging as a pivotal strategy with significant economic implications. Backed by compelling statistics, media reports highlight that digital twin plays a crucial role in revolutionising operations, indicating a substantial 20 per cent reduction in unplanned downtime. Moreover, there is evidence of a significant increase of up to 5 per cent in asset utilisation rates. Additionally, studies emphasise the potential for up to a 25 per cent reduction in safety hazards, leading to improved safety standards and regulatory compliance. Furthermore, there is a likelihood of significant cost savings of up to 20 per cent across asset-intensive industries.
Future outlook
As the oil and gas sector continues to grow, the adoption of digital twin technology will also gain momentum. However, it is the advancements in AI/ML, high-performance computing, augmented reality/virtual reality, process automation and other emerging technologies that will fundamentally drive the growth of digital twin technology by enhancing its precision and functionality, and broadening its range of potential applications. Its increasing adoption is thus a pivotal indicator for sustained market expansion, driven by the widespread focus on digitalisation initiatives. Digitalisation of the gas distribution network through the adoption of relevant technology is the only way forward to achieve infrastructure development targets.