N. Sea slump drives oil and gas sector to dump ‘risk-averse’ approach to innovation

decommissioning oil rigsThe current North Sea slump should result in the industry being more open to change and adopting new technology faster, according to the head of the Oil and Gas Innovation Centre (OGIC).

Businesses of all sizes in the oil and gas industry are still prioritising technology development despite the market pressures resulting from the lower for longer oil price environment, according to Ian Phillips.

With almost 100 projects in various stages of development, the centre sees a ‘strong appetite’ within the industry for research and development and near-to-market technologies – particularly amongst small- and micro-companies based in Scotland.

OGIC provides a single access point to the knowledge and capabilities of Scottish universities for the oil and gas industry. It takes company requirements and seeks expressions of interest from Scottish universities to support each project.

It also part-funds and provides management support to projects with the potential to deliver technology solutions to the exploration, production and decommissioning challenges facing the North Sea sector.

Phillips said: “In the past 18 months, we have supported six projects to completion and has a further 11 – involving collaborations between companies and Scottish universities – are underway

“These projects total £1 million of investment by OGIC and the companies.  A further 80-plus projects are in development with a minimum of non-disclosure agreements already signed.  If these projects come to fruition a further £2.5 million of investment will be made in research and development.”

Completed OGIC-supported projects have seen the development of near-to–market technologies which will impact a number of challenges facing the UKCS, including a new insulating product for subsea pipelines and the testing of a new well-intervention product. 

Current projects include Aberdeen-based Xodus working with Dundee University to explore the best approach to the decommissioning of subsea structures and Badger ASA working with Glasgow University on the development of a novel well-drilling tool.

Phillips added: “Technology innovation will play a key role in maximising economic recovery in the UKCS and in driving export growth in our supply chain. While R&D budgets have been impacted over the past two years, we see a continuing commitment to innovation in products and services all across the supply chain.

“This recession has focussed minds on costs and efficiency and – irrespective of where oil prices move –  this has been a necessary recalibration for the industry. Hopefully positives will come out of in what has historically been a risk-averse sector.

“We find it inspiring that – even in a downturn – so many individuals are willing to take significant personal risk to turn great ideas into deployable technology products.”


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