Ladies and gentlemen, it is a pleasure to be back at MEOS.
I'd like to thank not only our organizers and our Bahraini hosts, but also my colleagues, Paal and Lorenzo, for sharing their thoughts on this morning's topic.
And that is: the evolving nature of what “resilience” means to our industry.
Because the enablers of our profitability, adaptability and sustainability – the enablers of “resilience” – are being redefined.
Much like the energy landscape itself.
While renewables and alternative fuel sources continue to make progress, their ability to meet a sizeable portion of growing global energy demand is decades, if not generations, down the road.
We can be confident that oil and gas will continue to play a vital role for the foreseeable future.
But to sustain this industry we must increase our value proposition for society, particularly as alternatives become more affordable.
So what does a successful oil and gas company of the future look like?
In a word, I believe it must be “smarter.”
But I don't mean solely in terms of technology.
Engineering, earth sciences, managing mega-projects – this is our wheelhouse – our “I.Q.” if you will.
But I believe we must also develop stronger emotional intelligence, or “E.Q.”, to better understand and meet society's expectations.
And a renewed focus on cost and competitive advantage is imperative – our “C.Q.”
So let me explore these three measures of a “smarter” energy company.
First, our I.Q.
Our industry has a unique and historic opportunity to be at the epicenter of the Fourth Industrial Revolution.
In fact, I am proud to say Saudi Aramco was working in the Fourth Industrial Revolution years before the World Economic Forum coined the term!
For instance, one of our oldest gas plants, at Uthmaniyah, has become a leader in the use of Advanced Analytics and AI solutions.
This has helped us cut inspection time by 90%, reduce cost, improve safety.
In fact, WEF recently recognized the plant as one of its “Lighthouses” leading the way in Industry 4.0.
And the only one from oil and gas.
I mention this because, as an industry, we have massive amounts of data from seismic, production, mechanical and electrical functions.
A single drilling rig or gas plant can generate terabytes of data every single day.
But we tap into only a very small fraction of it.
By applying new technologies to data we are already generating, we can change the game.
In exploration, for instance, Machine Learning and AI can sift through vast amounts of 3D and 4D seismic data to extract features invisible to the human eye.
Or more ambitiously, in drilling, we should settle for nothing short of fully-automated drilling rigs to increase performance, safety and efficiency.
So as an industry we must reclaim our passion for innovation.
Because there are technologies within our reach that are turning science fiction into science fact.
So what's holding us back?
Certainly, market turbulence has had a chilling effect on investment.
In field development, investments are mostly in short-cycle, smaller projects. While in R&D, they are mostly in incremental improvements with quick payouts.
We must reverse this trend.
Because I believe lagging investment is the greatest single threat to our future success.
Complicating matters, we tend to keep our problems to ourselves.
But that won't cut it in the 4.0 space, where innovation comes from collaboration, not isolation.
Breakthroughs come when we blur the lines.
Whether it's a full-scale test deployment with a leading robotics company, or a simple collaboration with a university on a difficult algorithm, we must transform our industry by working together.
Next, our E.Q. – our emotional intelligence.
A successful energy company of the future must be seen as contributing to human advancement…
A company focused not only on shareholders, but also our broader stakeholders … from consumers and employees, to suppliers, governments, regulators, and communities.
Clearly this applies to climate change, where we must have a healthier and more productive dialogue with the public.
Obviously, that means we must be actively committed as an industry to delivering technologies that reduce the GHG footprint of hydrocarbons.
But as well as a big push on R&D, we must also be better at communicating the actions we are taking and the progress we are making.
That we are as concerned about the world we leave our grandchildren and their grandchildren as anyone.
Doing so can correct the misperception that our industry is simply “part of the problem” on climate change. And help our stakeholders realize we are part of the solution.
A big part – as we are starting to see with the Oil and Gas Climate Initiative, and the efforts that individual companies are making in areas such as engine efficiencies, CCUS, reduced flaring and so on.
Finally, our C.Q. – our focus on cost and value.
A successful energy company will build and exploit a clear competitive advantage.
We know technology is a differentiator.
But it is not the only one.
For a service company, a renewed focus on efficiency and cost leadership, with a higher quality of service, will offer success where others fall behind.
Maximizing areas of competitive advantage and differentiation is critical to increasing the value proposition of both our goods and our services, in relation to alternatives whose costs are on a downward trajectory.
Because, in a more competitive future, only the very best will thrive.
Ladies and gentlemen, redefining resilience will redefine our future.
For me, that means working as smartly on our E.Q. and C.Q. as we have always done with our I.Q.
If we do, then I am confident that this great industry will continue to grow, continue to be profitable, and continue at the heart of human progress for generations to come.
Finally, I must take the opportunity to mention next year's International Petroleum Technology Conference.
Like MEOS, IPTC is a great opportunity to pool our thinking on the technology challenges we face as industry.
And, for the first time ever, IPTC 2020 will take place at the other end of the causeway in Saudi Arabia.
We have extended the deadline for abstracts to the end of this month, and we look forward to seeing you all in Saudi next January for an historic IPTC.