A closer look at the future of blockchain in the oil and gas industry.
When looking at blockchain technology within the oil and gas industry, it may appear at first glance that its only applicability stems from its initial purpose within the payment industry and the financial sector. The general concept for blockchain in the oil and gas industry is use in retail, wholesale and trading.
Although we do indeed envision its use in many of these cases, we are now observing a growing number of cases where blockchain is used beyond these more obvious areas. Oil and gas companies begin to use the technology both in upstream and refining, and do so in the areas which at first glance do not relate to blockchain. The examples we see in our work with oil companies vary from well maintenance record management through to geological operations and interaction with safety regulators.
For instance, one of the Russian oil and gas companies has leveraged a KPMG-developed concept when implementing a proof-of-concept implementation of blockchain with IoT for Arctic shelf blockchain-enabled supply chain tracking and logistics monitoring. The technology provides transparency with regard to the responsibility and accountability of each party involved in the process.
Blockchain is already the oil and gas reality. Still, the main issue for the technology in the industry is not the lack of real use-cases within the company perimeter, but rather the absence of technology-driven participants beyond it. In order to fully realize blockchain technology benefits one needs to have its counterparties, recruitment agencies, regulators, etc, within the said blockchain ecosystem.
Our most traditional business, audit, is also not an exemption to this trend. Much like for any other industry, future audits related to oil and gas companies can and likely will be transformed by the technology that redefines the very notion of trust, transparency, and third party review. Blockchain creates many opportunities for the oil and gas industry and the future of the industry will for sure lie with it.
Note: The forecasts/analyst estimates above from Brent & Henry Hub are an indication based on third party sources and information. They do not represent the views of KPMG.