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The big three questions to the Head of Asset and Digital Transformation

January 28, 2020 Jon Allwood, Head of Asset and Digital Transformation

As head of digital transformation within KBC I have the opportunity to speak to many leaders in industry, but in essence there are three questions that define the conversations.

What is the biggest digitalization challenge faced by the refining industry today?

In short it is value sustainment from the Digitalization opportunity.

There is an emerging refinery overcapacity situation which will pressure margins and, in turn, drive an agenda of constant improvement. Digitalization is seen as a big part of the solution and we have active projects around the world, where they are taking the opportunity of digitalization to make better decisions, faster, that can be executed perfectly, every time. In particular, there is one large Asian multi-site refiner that we are helping to deliver margin improvements in the order of $0.50 to $1.00 per barrel.

We are doing this in such a way to preserve the benefits. Since value sustainment from Digitalization is a journey, with this multi-site refiner we are taking a holistic view with several different steps:

  1. Data - getting this ready to be used, such as automated collection and reconciliation. This is always the first step on the Digitalization journey.
  2. The business needs to understand and accept the maturity of its organization. Often they are not yet mature enough to capture and sustain digital benefits. In order to do this, often it takes new strategic vision, skills and agility to move an organization focused on risk minimization and maintaining profitability, to one that is all about business growth.
  3. The digital twin technology is the key to effective decision-making in this new world; individual digital twins are available but don’t capture the full benefits for the entire business. At KBC we have some of the best technology in the industry and our development focus is on integration, so that our clients get the best holistic outcome from the most accurate and agile tools available.
  4. The last aspect is embolden organization to let go of the status quo, get more ambitious and move toward more autonomous operations. Digitalization enables this and KBC, as part of Yokogawa, is working with GazpromNeft to deliver digital transformation by creating the industry’s first production control centre, which will facilitate the transition from managing individual facilities and complexes to the predictive management of entire processing chains.

What do you view as the most disruptive change in the energy and chemical industry?

There are countless changes happening but the largest one I see is decarbonization and the industrial energy transition. Societal mega-trends coupled with transformation of the sector has made the energy transition an executive imperative. We produced a manifesto to highlight the actions that are available to take now and the indicators that will illustrate the scale and pace of the transition. A few key takeaways from the manifesto are:

  1. For the industry in the short-term, the most economic means to reduce carbon intensity is energy efficiency improvement. When KBC is talking to our clients we know that there are 20-30% emissions reductions economically possible, with Digitalization being a key enabler for faster improvements. To this effect last year, we created KBC’s global Energy and Sustainability Co-Pilot Hub in Singapore to enable the Energy and Chemical industry to simultaneously optimize the supply, demand and re-use of energy by providing cloud-based, digitalized energy management services and next generation analytics.
  2. For the medium and long-term, decarbonization means electrification will play a greater role in everyone’s lives. Targeting zero direct emissions as a business would mean electric as the main energy source in new builds and revamps whilst investigating carbon capture, (re)use and storage (CCUS) for the harder to replace sources. The rise of the electric car will continue, but with 99% of cars using internal combustion engines, challenges in scaling the electric car market means that, on the whole, it will be an evolutionary change.

What’s new that I should focus on?

The development between our flagship process simulator, Petro-SIM, and its integration OSIsoft’s PI, which is being used to create asset-wide digital twins. This allows an asset’s lifecycle to be fully designed, built and operated to an aligned optimum. We are also working with companies for AI and ML use cases aimed at wider and greater benefits of full stream value chain optimization. I am also really excited about developing our client’s operational excellence and digital maturity as it is only when People, Assets, Practices and Systems are aligned to the corporate vision that digital transformation can actually happen.

Find out more about our Digitalization solutions.

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