Norwegian oil giants, Equinor, announced that they would be incorporating blockchain technology to drive down costs and promote green practices.
The government owns 70 percent of Equinor, so they need to make oil production complement the Scandanavian country's environmental policy. CEO Anders Opedal aims to make Equinor a carbon-friendly, “net-zero” oil company by 2050.
Equinor's Involvement With Blockchain Technology
Back in 2019, Equinor did a pilot project with blockchain technology. After its success, they decided to invest $6 million in Data Gumbo – a startup based in Houston that runs its own blockchain ledger GumboNet.
Johan Sverdrup, Equinors 300-foot-tall platform, integrates blockchain technology and conducts vital operations, such as tracking the drilling of new wells, measuring the quantity of oil being produced, and many other core functions. The information is all being transmitted to Data Gumbo. Following Johan Sverdrup's success, Equinor will roll out this tech to 10 of their other projects. In its first year of operations, Equinor expects to save $20 million.
Blockchain Picking Up Popularity Among Oil Companies
In 2020, several oil companies already started adopting the technology. The formation of the OOC Oil & Gas Blockchain Consortium is a massive step in this direction. It includes 10 companies, including ConocoPhillips, Equinor, Exxon Mobil Corp, Repsol, and Royal Dutch Shell. The consortium has already tested Data Gumbos ability to automate payments for oilfield water-handling.
As per their findings, the blockchain reduces the overall workflow process from 90-120 days to one to seven days by cutting nine steps in total. Shell, one of the biggest and most well-known oil companies in the world, has committed to become an early adopter of blockchain technology and use it to boost its supply chain.
Blockchain Technology Is The Way Forward For The Oil Sector
Along with boosting the overall supply chain management, the blockchain can easily monitor and evaluate carbon emissions. As per studies, blockchain technology can accurately assess the carbon footprint of an oilfield project. Seeing Equinor's success, 2021 could see several major oil companies follow suit.