Refiners Set to Increase Spending on Digital Technologies to Drive Down Operational Costs, Though Digital Not a Top Investment Priority, According to Research from Accenture

New efforts will focus on increased cybersecurity, as digital
technologies expose refiners to greater risk

NEW YORK–(BUSINESS WIRE)–Nearly two-thirds of refiners plan to increase their investments in
digital technologies over the next three to five years, although digital
is not one of the top plant investment areas for refiners today,
according to new research from Accenture (NYSE:ACN).

The Accenture
Connected Refinery research – based on a survey of more than 200
executives, functional leaders and engineers at refiners globally –
shows that more than half of respondents (57 percent) said that their
current level of digital investment overall was more or significantly
more than 12 months ago.

While this spending is set to increase, only 19 percent of refiners
rated digital as one of their top three priorities for spending on plant
efficiency and productivity over the next three years.

When asked to identify the most important benefits that digital
technologies will provide, respondents most often cited more-effective
plant management (63 percent of respondents), reducing operational risk
(59 percent) and more-efficient and predictive maintenance (54 percent).

Reducing operational costs appeared most frequently in the top three
business priorities that will drive refiners’ next digital investments,
cited by 39 percent of respondents, yet the most frequently mentioned
barrier to digital implementation was the investment required, cited by
50 percent of respondents.

“Investments in digital technology, when deployed at scale, can generate
operational savings far exceeding the investment costs, even in the
short term,” said Andrew Smart, the managing director who leads
Accenture’s Energy practice. “The fact that refiners plan to spend more
on digital shows that they are cautiously optimistic about the
incremental benefits to operations that new digital technologies can
provide. While there is also concern about the cost of deploying these
new solutions, leveraging big data and analytics for real-time
operational insights could help refiners achieve best-in-class
operational performance.”

Tracey Countryman, managing director, Asset and Operations Services,
Accenture, said, “Now that computing power is cheaper than ever and
mobile and Internet of Things solutions are more viable, refiners must
move beyond simply piloting new digital technologies and into deployment
at scale to see the benefits of digital. They will then recognize the
significant reduction in operating costs and the potential for
fundamental business transformation that these technologies can enable.”

Increase in digital investments prompts data security concerns

When asked to identify the digital technologies that drive the greatest
impact in operational performance, respondents most often cited
analytics (74 percent), cybersecurity (41 percent) and mobility (38
percent). The inclusion of cybersecurity among the top three suggests
that companies are seeking to offset the greater risk of cyberattack
that comes with more-connected refinery operations. Some of the current
and future planned business investment areas that increase this
connectivity include more automation, moving operations to the cloud,
mobile solutions, AI and robotics.

“As the number of connected systems and devices that share data in the
energy value chain continues to grow, so does the scale and impact of
any potential cyberattack risk,” Countryman said. “Historically,
refinery execution and control systems have been on premise, locally
maintained and fairly isolated compared with enterprise systems. With
increases in wireless infrastructures connecting people and connecting
machines, and manufacturing execution system applications moving to
cloud, new operational technology security measures are required.”

Showing the need for new measures, more than one-third (36 percent) of
respondents cited data security as a barrier to adoption of digital
technologies; this figure rose to 50 percent among IT professionals
surveyed.

The concern about cybersecurity is also reflected in Accenture
Technology Vision 2017. When asked how often their organization
updates its security policies and codes, respondents from the downstream
sector said they updated them more frequently than other industries
(yearly or less than yearly).

Methodology

The online survey was conducted in March 2017 by PennEnergy Research in
partnership with the Oil and Gas Journal. The survey was developed with
HSB Solomon Associates LLC, a benchmarking and global advisory services
company for the global energy industry. Respondents are subscribers to
PennWell publications and comprised more than 200 refining industry
professionals, including executive and mid-level management, business
unit heads, engineers and project managers from a cross-segment of the
industry. The countries represented were Australia, Azerbaijan,
Bangladesh, Canada, China, Curacao, Dominican Republic, Finland, Ghana,
Greece, India, Indonesia, Iraq, Malaysia, Norway, Qatar, Singapore,
South Korea, Sri Lanka, Trinidad and Tobago, Turkey, the U.K., the U.S.
and Venezuela.

About Accenture

Accenture is a leading global professional services company, providing a
broad range of services and solutions in strategy, consulting, digital,
technology and operations. Combining unmatched experience and
specialized skills across more than 40 industries and all business
functions – underpinned by the world’s largest delivery network –
Accenture works at the intersection of business and technology to help
clients improve their performance and create sustainable value for their
stakeholders. With more than 401,000 people serving clients in more than
120 countries, Accenture drives innovation to improve the way the world
works and lives. Visit us at www.accenture.com.

Contacts

Accenture
Guy Cantwell, +1 281 900 9089
[email protected]
or
Matt
Corser, +44 755 784 9009
[email protected]