Over the last five years, the oil and gas field services industry has hit hard times, as oil prices plummeted and never quite recovered. IBISWorld calculates that oil and gas field service industry revenue has declined by 10 percent in the last five years, and is expected to be approximately $75 billion in 2019. The number of businesses over that time has declined by 2.1 percent and the number of employees is down by three percent, IBISWorld says.
Recent Challenges in Oil and Gas
The Houston Chronicle’s article, “Oilfield services companies face another tough slog,” portrays the dire straits the industry is in. It reports, “Energy services companies are facing another tough slog as they recover from a deep industry downturn that piled up billions of dollars in red ink and cost tens of thousands of jobs…Despite record oil and natural gas production in the United States, the stock prices of Schlumberger, the world’s biggest energy services company, and Halliburton, number two, have fallen to about half of what they were a year ago. The share price of number three Baker Hughes is down by more than one-third.”
All this is happening when the oil and gas field services industry should be booming because of the dramatic increase in oil and gas production in the United States, says Ben Carey, a managing director with the Houston office of energy strategy and consulting firm Accenture. He told the newspaper, “Given increasing production in service-intensive U.S. shale plays, it should be the golden era for service companies. But it’s not.”
The reason? The newspaper reports, “Services companies are particularly sensitive to swings in oil prices. When crude prices fall, one of the first places oil and gas producers turn to cut costs are energy services.”
The Solution? Digital Technology
However, it needn’t be that way. Carey says that a solution is close at hand for the oil and gas field services industry — use digital technology to increase automation, collaborate better, collect massive amounts of drilling information and other data from sensors, and analyze the data. He says that would increase efficiency, cut costs and boost profits.
“A business model change like that will change a zero sum game to a win-win,” he concludes.
The Best Technology for the Oil and Gas Field Services Industry
Oil and gas field services companies need to find a platform that can help them build the tools to do all that. An ideal one is Alpha TransForm. It lets oil and gas services companies build applications that tie the field directly to back office operations, improve logistics, streamline inspections and dramatically improve data capture.
It has the unique ability to rapidly create mobile-optimized forms and field apps that can easily access and integrate with existing databases and web services. It builds offline apps, vital for the oil and gas industry, and excels at mobile apps for field workers.