MINI PROJECT REPORT

ON

“The Application of Emerging Technologies In The Petroleum

Industry”

Under the Guidance of

MISS BHOOMIKA TREHAN

(Assistant Professor) , ICCMRT

Submitted in Partial fulfilment for the award of

Degree of Master of Business Administration from
Dr. APJ Abdul Kalam Technical University, Lucknow
Submitted By:

Abhinav Singh
Roll no: 2301240700002
MBA SEMESTER 2nd
MBA (Batch 2023-2025)

INSTITUTE OF CO-OPERATIVE & CORPORATE

MANAGEMENT, RESEARCH AND TRAINING
LUCKNOW-226016

Phone: 271631, 2716092

 Fax: (0522) 2716092
E-mail: [email protected]
Website: www.iccmrt.ac.in

Institute of Co-operative & Corporate Management

Research and Training
467, Sector-21, Ring Road, Indira Nagar, Lucknow-226016
सहकारी एवं कॉर्पोरेट प्रबंधन संस्थान, अनुसंधान एवं प्रशिक्षण 467, सेक्टर-21, रिंग रोड, इंदिरा नगर, लखनऊ-226016

Date/ ……………….
CERTIFICATE
This is to certify that Abhinav Singh (Batch 2023-2025), a student of the Master of
Business Administration (MBA) Programme(Batch 2023-2025) At this institute has
conducted a Mini Project titled “The Application of Emerging Technologies In The
Petroleum Industry” under my guidance during 1st semester. The Mini Project has
been prepared towards partial fulfilment for the award of an MBA degree from Dr.
A.P.J. ABDUL KALAM TECHNICAL UNIVERSITY. The Mini Project report is
the original contribution of the student.

The Mini Project report is hereby recommended and forwarded for evolution.

Certified By: Submitted to:

(DR. K. ANBUMANI ) BHOOMIKA TREHAN
PRINCIPAL, ICCMRT AssistanProfessor/
(Faculty Mentor)
 DECLARATION

I Abhinav Singh, a student of the Master of Business Administration (MBA) Programme

(Batch 2023-2025) at the Institute of Co-operative & Corporate Management Research and
Training, Lucknow hereby declare that all the information, facts and figures used in the Mini
Project titled “The Application of Emerging Technologies In The Petroleum Industry”.

All have been collected by me and I also declare that this mini-project report has been
prepared by me and the same has never been submitted by the undersigned either in part or in
full to any other university or institute or published earlier.

This information is true to the best of my knowledge and belief.

Date: ......................

Abhinav Singh
MBA SEMESTER 2nd
Batch (2023-25)
 ACKNOWLEDGMENTS

I owe a great many thanks to a great many people who helped and supported me
during the writing of this project. Thanks and appreciation to the employees of the
organisation for their help and unbiased responses regarding my queries. My deepest
thanks to the director of our institute Mr. Alok Dixit for his continued support. I
express my thanks to the Principal of ICCMRT Lucknow, Dr. K.Anbumani
(Associate Professor, Principal) for extending his support and valuable guidance.
My deepest thanks to MISS BHOOMIKA TREHAN (Associate Professor) the
Faculty Mentor of the project for guiding and correcting various documents of mine
with attention and care, he has taken pain to go through the project and make
necessary corrections as and when needed.

Date: ……………….

Abhinav Singh
MBA Semester 2nd
BATCH ( 2023-25)
 Preface

The project titled “Application of Emerging Technologies in Petroleum Industry” has been

undertaken with the objective of analysing the emerging technologies, economic growth in

the Indian market & its role in the development of the country. It represents India’s energy

needs and is the most valuable public as well as private enterprise.

As a collective result of private sector and public sector refinery investments in the recent

past, India will become known by 2012 as Asia’s largest refined product exporter, surpassing

Singapore. India will remain one of Asia’s two largest refined product exporters for the

anticipated future.

India has suddenly become a global petroleum-producing centre because of increasing the

depth of product flows and strengthening supply chains, especially clean transport fuels and

high-end industrial products. It also has far-reaching implications for regional product

markets.

The business of India’s large-scale export-oriented refining sector marks the increase of the

rate of a basic shift in the design of global refining in which growing economies increasingly

look to production hubs in Asia and the Middle East to supply incremental refined product

demand.
 TABLE OF CONTENT

Introduction..............................................................................................................................................................
Growth and Evolution of the Petroleum Industry in India...........................................................................................
Domestic crude oil production [million tpa]-...............................................................................................................
Product Profile-............................................................................................................................................................
Petrol............................................................................................................................................................................
Liquefied petroleum gas (LPG)....................................................................................................................................
Kerosene......................................................................................................................................................................
Jet fuel..........................................................................................................................................................................
Naphtha........................................................................................................................................................................
Lubricating oil...............................................................................................................................................................
Petroleum coke............................................................................................................................................................
High-speed diesel oil....................................................................................................................................................
Light diesel...................................................................................................................................................................
Furnace oil....................................................................................................................................................................
Demand determination of the Industry.......................................................................................................................
Demand determination factors..................................................................................................................................
Competition...............................................................................................................................................................
Players in the Industry..................................................................................................................................................
Indian Oil Corporation Ltd (IOCL).................................................................................................................................
GAIL India.....................................................................................................................................................................
Reliance Industries.......................................................................................................................................................
Bharat Petroleum Corp. Ltd (BPCL)..............................................................................................................................
Hindustan Petroleum Corp. Ltd (HPCL)........................................................................................................................
ONGC Corporation.......................................................................................................................................................
Distribution channel of the industry...........................................................................................................................
Marketing and Distribution of Petroleum Products in India........................................................................................
Retail outlets in India...................................................................................................................................................
Key issues and current trends....................................................................................................................................
Issues in petroleum industries.....................................................................................................................................
Problems faced by the Indian petrochemical industry................................................................................................
Major Challenges in the Oil and Gas Industry | Quantzig | Business Wire..................................................................
Current trends in the petroleum industry...................................................................................................................
Top 10 Oil & Gas Industry Trends & Innovations in 2021............................................................
Emerging technology to boost productivity................................................................................................................
The fastest "find": edge computing.......................................................................................................................
Troubleshooting from the sky.....................................................................................................................................
Constructing digital models..........................................................................................................................................
Augmented reality........................................................................................................................................................
 Blockchain....................................................................................................................................................................
Quantum computing....................................................................................................................................................
SWOT Analysis:..........................................................................................................................................................
Strengths......................................................................................................................................................................
Weaknesses..................................................................................................................................................................
Opportunities...............................................................................................................................................................
Threats.........................................................................................................................................................................
PESTEL analysis..........................................................................................................................................................
PESTEL Analysis Framework, Template, Exercises, Examples | Map & Fire................................................
Political.........................................................................................................................................................................
Economical...................................................................................................................................................................
Social............................................................................................................................................................................
Technological...............................................................................................................................................................
Environmental..............................................................................................................................................................
Legal.............................................................................................................................................................................
Conclusion.................................................................................................................................................................
Bibliography..............................................................................................................................................................
 Introduction

The petroleum industry, also known as the oil industry or the oil patch, includes the global
processes of exploration, extraction, refining, transporting (often by oil
tankers and pipelines), and marketing of petroleum products. The largest volume products of
the industry are fuel oil and gasoline (petrol). Petroleum is also the raw material for
many chemical products, including pharmaceuticals, solvents, fertilizers, pesticides, synthetic
fragrances, and plastics. The extreme monetary value of oil and its products has led to it
being known as "black gold". The industry is usually divided into three major
components: upstream, midstream, and downstream. Upstream regards exploration and
extraction of crude oil, midstream encompasses transportation and storage of crude, and
downstream concerns refining crude oil into various end products.
The Indian petroleum industry started its journey at a very slow pace from a place called
Digboi, in the state of Assam. The production of petroleum and new extraction locations was
mainly limited to the Northeastern parts of the South Asian country till the 1970s. In the
beginning, complete sponsorship of the industry came through the government. In July 1991,
with economic liberalization and privatization, the Indian government started allowing
industrial control to private hands and entered into joint ventures. This gave the growth in the
sector a tremendous boost. In 2019, the production volume of petroleum products in the
country amounted to more than 262 million metric tons. Since then, the impact of the private
sector on the petroleum industry has been immense. Under the private sector, there was
a refinery capacity addition of almost 90 million metric tons in 2019. India is the second
largest refiner in Asia, second only to China.

Oil & Gas reservoir research and exploration requires the utilization and adaptation of a large
number of different technologies spread over numerous engineering fields. Because of the
intense resources involved in such operations, the Exploration and Production sector (E&P)
results to be a power-demanding field and particular attention should be paid to making it
smarter and more efficient.

In the research of technology updates, upstream, as well as downstream, the Oil & Gas
industry has always been seeking out external innovations even in the field of informatic
technologies and robotics.
In Figure work-class ROV (remote operated vehicle) for subsea exploration is reported
during its assembly phase. ROVs are made from robotic arms, known as manipulators, a
camera, for subsea environment visual analysis, electrical drivers for motion control and
batteries or external cables for communication and power delivery. ROVs for exploration
were introduced during the ‘70s and represented a significant technology update in their field:
thanks to the fact that they can be designed to operate at very high pressure and low-
temperature conditions, with respect to human operators, they allowed discovering a high
number of new oil fields that previously were thought impossible to be investigated,
increasing the opportunities for Oil & Gas companies. The introduction of ROVs also
decreased the cost of exploration operations and, on top of the economic aspect, they
increased safety by substituting and replacing human operators.

ROVs represent also an example of technology transfer from external sectors (in this case the
military sector) to upstream Oil & Gas operations. Technologies that come into the Oil & Gas
sector often enter into a prolific chain of innovation and become refined and commercialized.
That was also the case for ROVs, which having been incorporated for years in the Upstream
sector, found new applications for scientific research in marine biology and they have been
used over the years to search for famous shipwrecks and discover new marine species.
Growth and Evolution of the Petroleum Industry in India

The petroleum industry includes the global processes of extraction, exploration, refining,
transporting (often by pipelines and oil tankers), and marketing petroleum products. The
largest volume products of the industry are gasoline (petrol) and fuel oil. Petroleum (oil) is
also the raw material for many chemical products, including solvents, pharmaceuticals,
pesticides, fertilizers, and plastics.

The origin of the Indian oil & gas industry can be traced back to the late 19th century when
oil was first struck at Digboi in Assam in 1889.Because of the significance of the gas & oil
sector for overall economic growth, the Government of India announced in 1954 that
petroleum would be the core sector industry.

1954, petroleum exploration & production activity was controlled by the government-owned
National Oil Companies (NOCs), namely Oil India Private Ltd (OIL) and Oil & Natural Gas
Corporation (ONGC). India’s refining capacity has more than trebled in the last 13 years.
Reliance Industry was the first refinery industry in Jamnagar in 1999, India had an installed
capacity of around 193.5 million tpa in April 2011.

The growth is likely to continue with refining capacities expected to touch 255 million tpa by
2012-13 and 302 million tpa by 2017-18, with a slew of projects announced by both the
private and public sectors. Today, the private sector accounts for 76.5 million tpa (around
39.5 per cent) and public sector oil companies account for close to 117 million tpa (around
60.5 per cent).
There has been healthy growth in India’s petroleum refining capacity in the last five years, as
described by the table below
Domestic crude oil production [million tpa]-

Total Products from Indigenous Products Total Import Self-

Provisi consump Indigenous crude from Indigenous dependenc sufficien
onal tion crude processing fractionators production e% cy %
2005-
06 113.2 26.6 28.3 4.2 30.8 72.8 27.2
2006-
07 120.7 28.4 30.2 4.0 32.4 73.2 27.0
2007-
08 128.9 28.2 30.0 4.1 32.3 75.0 25.0
2008-
09 133.6 27.0 28.8 4.2 31.2 76.7 23.3
2009-
10 138.2 27.2 28.9 4.4 31.6 77.2 22.8
The capacity utilization of Indian refiners for the last few years is described in the table.
Indian refiners have also operated at higher operating rates or capacity utilization compared
to their regional/global peers implying efficiency in operations.

However, imports from India’s refining industry are growing, as the domestic crude oil
production has been stable at around 30 million tpa for the last few years.

Generally, GDP growth rates and petroleum product consumption are linked. But, in our
case, factors like the availability of better roads, more fuel-efficient vehicles, improvements
in mass urban transport modes and increased availability of natural gas for the industrial
sector contributed to more moderate growth in recent times. Indian refineries are clocking
higher Gross Refining Margins compared to regional benchmarks a clear sign of
competitiveness in refining operations.

If all the planned projects materialize, India will have an exportable surplus petroleum
product of around 100 million tpa by 2012 and 140 million.
Product Profile-

This section provides a brief description of the technology and production process. An

understanding of these issues is critical as it helps understand industry structure.

Crude oil is a liquid mixture of hydrocarbon chemical compounds consisting roughly of six

parts of carbon and one of hydrogen, both of which are fuels; it generally also carries small

quantities of salts sulphur, oxygen, metals and nitrogen.

The principal products obtained from crude oil are

Petrol

Petrol is used to fuel internal combustion engines, mainly vehicular. It is early used as a killer

of lice and their eggs have completely disappeared.

Liquefied petroleum gas (LPG)

LPG is mostly a combination of propane and butane. It is heavier than air and liquefies under

pressure. It is used as a household cooking fuel, vehicular fuel and refrigerant; 4 million

vehicles are estimated to be powered by LPG in the world.

Kerosene

Kerosene also known as paraffin, is used as an illuminant and cooking fuel in India and other

poor countries, and as a space-heating fuel in industrial countries.

Jet fuel

It is used in jet planes and is closely akin to kerosene.

Naphtha

Naphtha is used to make additives for high-octane petrol and to make polymeric plastics and

urea, a nitrogenous fertilizer.

Lubricating oil

It consists of greases and viscous oils used to lubricate moving parts in automobiles, industry,

railway engines carriages and marine engines.

Petroleum coke

It is mostly used as fuel but is also used to make dry-cell batteries and electrodes.

High-speed diesel oil

It is used in engines running at 750 revolutions per minute (rpm) or more. It is mostly used in

diesel-powered vehicles.

Light Diesel

It is used in diesel engines running at lower speeds – mainly irrigation pumps and generation

sets.

Furnace oil

It is made by diluting residual fuel oil from refining with middle distillates such as diesel oil.

It is used in bunkers, boilers, furnaces, heaters, or as fertilizer feedstock.

Demand determination of the Industry

The petroleum industry in the country has undergone a major transformation in the past

several years. The country is now a net exporter of petroleum products. Globalization of the

Indian economy along with high international oil prices which are a pass-through in the bulk

sector has induced improvement in energy efficiency and a shift of demand from liquid to

natural gas (LNG).

Further, improvement in road infrastructure and better vehicles has had a sobering effect on

the demand for road transportation fuels. Low demand for transport fuels like HSD and MS is

also due to factors like an expansion of city gas distribution networks i.e. CNG.
 Demand determination factors

The Demand determination factors are based on mainly two approaches. Top-down Approach

and Bottom-up Approach.

Top-down Approach: – Overall energy requirements with the share of different fuels in the

primary commercial energy basket by linking GDP with energy elasticity.

Bottom-up Approach: – End-use approach considering the impact of different parameters.

While assessing the requirements factors like impact of Metro rail, CNG expansion, impact

of high oil prices, conservation/efficiency improvement issues, aviation policy of the

Government, Railways freight policy, growth of passenger and cargo traffic, fleet expansion

plan of airlines, National Highways Authority of India (NHAI) road construction projects,

construction of freight corridor, electrification plans of railway tracks vehicle population

growth, impact of gas, technological improvements in engine designs, improved fuel

efficiency, impact of auto LPG etc. have been measured.

The demand for gas continues to be influenced by the cost economics vis-à-vis alternative

fuels pertaining to each of the end-use sectors in India.

Power and fertilizer are also the dynamics of these sectors. Currently, the consumption of

natural gas is shared by the fertilizer and power sector to the tune of 29% and 40%

respectively.

The power sector is one of the continuous major consumers of natural gas. There has set a

target of 70,000 generations forecasted by the Ministry of Power for the next 5-year period

ending 2012.

The industries like Petrochemicals/Refineries and Internal Consumption sectors are estimated

that an annual economic growth rate of about 7%.

Similarly, the iron/steel sector is also estimated same rate for economic growth.
Currently, the demand for petroleum products is 131.8 MMT in 2011-12 which will be

increased by 160.2 in 2016-17.

The demand for petroleum product also depends on the availability of different products like

petrol diesel kerosene naphtha etc.

Their prices are the main factor in determining demand for these products.

The petroleum refineries must consider the price parity and export parity which consider the

change in price of petroleum products which depend on the experience.

Competition

Players in the Industry

 The various competitors are available in the petroleum industry which includes the

government and private sector. most petroleum companies are huge operations with billion-

dollar balance sheets. The oil and gas production and distribution is dominated by

government-owned companies which are heavily regulated except for Reliance Industries.

After liberalizing the operations of companies like Indian Oil Corporation Ltd (IOCL),

Hindustan Petroleum Corp. Ltd (HPCL) and Bharat Petroleum Corp. Ltd (BPCL) run billions

of dollars in losses as they are forced to sell petroleum products at below their cost.

The polices of government are mostly informal compensating these companies through

money transfers and bonds. some government companies like OIL India, ONGC and GAIL

which operate in production and have to bear less of the subsidy burden have grown and

performed very well. In the private sector companies like Aban Great Offshore, Essar and

Reliance have managed to grow rapidly as well with changeable degrees of success.

Here is the list of the major petroleum Companies in India

Indian Oil Corporation Ltd (IOCL)

The IOCL covers the whole hydrocarbon value chain from, pipeline transportation, and

marketing of petroleum products to exploration & production of crude oil & gas, marketing

of natural gas, petrochemicals and refining. The sales turnover of Indian oil was Rs 271,074

corer and profits of Rs. 10,221 corer in 2009-10. Indian oil’s cross-country network of crude

oil and product pipelines across 10,899 km and the largest in the country, meets the crucial

energy needs of the consumers in an economical, environmental and efficient manner.

GAIL India
GAIL (India) Limited, is India’s Natural Gas company, integrating all aspects of the Natural

Gas value chain right from discovery to marketing. It emphasizes clean fuel industrialization,

creating a square of green energy corridors that connect major consumption centres with

major gas fields in India. GAIL is growing its business to become a player in the

International market. The company’s revenue earned in 2009-10 was Rs 24,000 corer with a

net profit of 11%. It is a well-managed fast-growing company with high competitive barriers

in India.

Reliance Industries
It is India’s largest private petroleum company. The company has achieved remarkable

growth in the last decade and is diversifying into Retail. In the market top of more than $30

billion, it is India’s most valued company. It is also a highly petroleum exporting company in

India. The company is one of the largest oil refining and petrochemical complexes in the

world at Jamnagar.
Bharat Petroleum Corp. Ltd (BPCL)

it is the major distributor of petroleum, cooking gas and diesel in the Indian market. The

company’s revenue of Rs 36,000 corer and net profit of 0.5%. due to the government control

The company suffer from low margins and terrible stock price performance. Which forces the

company to sell the product at below the cost? Even after the liberalization with increased

global crude prices increasing the losses very much. The company produces a wide range of

products, from petrochemicals and solvents to aircraft fuel and speciality lubricants and

markets them to several international and domestic airlines and hundreds of industries.
Hindustan Petroleum Corp. Ltd (HPCL)

The company operates the largest refinery in the country producing Oils of international

standards. This Refinery accounts for 40% of India’s total Oil production. The company has

two major refineries producing a large variety of petroleum fuels & specialities. one in

Mumbai and the other in Vishakhapatnam. Its huge marketing network consists of its zonal &

regional offices facilitated by a supply & distribution infrastructure comprising terminals,

aviation service stations, retail outlets, pipeline networks and LPG distributorships. The

company’s market share accounts for about 20% and 10% of the nation’s refining capacity.

The company revenue earned was Rs 34,000 corer and the net profit margin of 0.65% in

2010.
ONGC Corporation

The company ranks 3rd in the petroleum Exploration & Production industry. It produces 803

Million Metric Tones of crude and 485 Billion Cubic Meters of Natural Gas from 111 fields.

It is the biggest multinational company with 40 oil and gas projects in 15 countries. The

company earned Rs. 20,000 corer with a net profit margin of 34% in 2010. NGC holds the

largest share of hydrocarbon in India & contributes over 79% of India’s oil and gas

production.
 Distribution channel of the industry

The petroleum distribution segment is rapidly adopting different kinds of supply chain

solutions. From crude oil selection to petroleum product distribution at the retail outlet, it is a

chain with many links. The refining margins, the lead time associated with fundamental

functions like product trading and crude buying unpredictability of oil prices make the entire

process challenging. Implementation of this solution on widespread installations, however, is

what the world is watching, as vast petroleum companies fight to “chain” the business. The

petroleum industry has a vital need for both integration and implementation skills to take the

best value out of the different distribution channels available.

Underground, the gas station is quite modern. The tanks for super unleaded and for regular

(the midgrade fuel) are larger than the normal tanks. Each tank is equipped with an electronic

level check that conveys real-time information about its status through a cable to the station’s

management system and then to the main inventory management system for the oil company

whose products the gas station markets.

The travels from the distribution channel push to demand pull is taking place in the section,

where once the challenge was in getting the best deals on buying crude, the focus is shifting

to giving customers what they want.

The petroleum business is separated into refining and distribution segments. The focus more

on the distribution segment.

There is a specific change to focus in the industry toward the distribution segment. The big

oil companies have started monitoring the inventories of crude oil or any other petroleum

products. The issues at the refining level are: which products to make in what quantity?

Which crude to use? Which units to run? While the issues at the customer-facing end or the

gas station are basic, namely runouts & refines.

The important functions within the distribution channel are optimization across alternative

means of transportation, demand forecasting, replenishment method to avoid retains/runouts

& finally scheduling, which sequences the dispatch.

 Marketing and Distribution of Petroleum Products in India

The public sector oil marketing companies (OMCs) which include Hindustan Petroleum

Corporation Ltd. (HPCL), Indian Oil Corporation Ltd. (IOCL) and Bharat Petroleum

Corporation Ltd. (BPCL) are primarily responsible for the marketing and distribution of

petroleum products in India.

With the opening of the retail sector for the private players, Shell, Essar and Reliance

Industries Ltd. (RIL) have also entered the retail marketing related to petroleum products.

The marketing and distribution infrastructure in the petroleum sector includes – liquefied

petroleum gas (LPG) distributorships, petrol/diesel stations, lubricants and grease outlets

IOCL is the market leader in terms of marketing and distribution of petroleum products.

Retail outlets in India

The number of retail outlets (ROs) in India has increased from 31,650 in April 2006 to

40,819 in January 2011.

IOCL has the widest network of ROs across India with 19,057 ROs as of January 2011.

The number of LPG distributors in India has increased to 9,686 in 2010 from 6,477 in 20011.

India’s Navratna oil marketing companies – Indian Oil, BPCL and HPCL- are set to report

another quarter of heavy losses as they have failed to get compensation from the government

for selling fuels below cost.

The three oil marketing companies (OMCs) sell diesel, LPG for domestic use and kerosene

through public distribution systems at prices that are substantially below their costs, in

accordance with the permission of their majority shareholder.

In return, a small part of their losses is made good by discounts from upstream like ONGC

and Oil India. The larger share of losses is made good by the government. During the June

’12 quarter, the three oil marketers together had posted a unique net loss of.Rs40,536 corer as

the dues from the government did not arrive.

The company expects most of the demand for Piped natural gas to come from the domestic

and commercial consumer sectors. Limitation on subsidized LPG cylinders is expected to be

a boon for its Piped natural gas business.

Consumers might come forward to get a Piped natural gas connection as its rates would be

economical compared to LPG cylinders. “The running cost of Piped natural gas would be

about 10 per cent less than the cost of LPG. Piped natural gas is a safer and more eco-friendly

fuel for the user.

As oil marketing companies advance forcefully to decrease their distribution channels for

LPG cylinders, the next few months will certainly prove trying for consumers.

Currently, oil companies in India are going through a tough task of maintaining positive

margins in a very unstable market of crude prices and increasing distribution costs. Oil

companies also need to be prepared for active pricing scenarios for the coming future.

Hence, the immediate need is to have a complete real-time visibility of sales and inventory

for perfect demand forecasts. Integration of different systems and different data to provide a
single consistent view and information to the oil company management thus forming a strong

foundation for effective decision-making.

 Key issues and current trends

Issues in petroleum industries

The global economy is a dynamic and ever-growing one despite the high cost of energy. This

in turn is forging the demand for petrochemicals. The strong growth in demand is not backed

by a sufficient supply so the cost is still to come down. Operating rates of major

petrochemical product segments are very high presently.

Problems faced by the Indian petrochemical industry

The manufacturing units mostly use the outdated format of technology and are not able to

produce optimally
There is a requirement for the modernization of equipment

Excise duty on synthetic fibre should be rationalized

Anticipation of reservation on Small Scale Units

Plastic waste to be recycled and littering habits to be discouraged

India requires an advantage on feedstock, so the import cost has to be brought down

The industry should have access to the primary amenities of infrastructure

One of the big issues is the difficulty in predicting the advance price, which will succeed in

the market in the future months. Some indications are of course available with the futures

prices prevailing in the exchanges. Some companies hedge their margins or crude prices by

doing paper trading. The forward price is a vital input in the optimization process and can

make the model for a particular product maximization based on its price.
Current trends in the petroleum industry

Petroleum has proven to be the most flexible fuel source ever discovered, situated at the core

of the modern industrial economy. While the industry is strong, it is subject to some very

significant stresses

● Industry consolidation (24 mergers and acquisitions since 1997)

● Global industrial expansion resulting in increased petroleum demand

● Tight supplies of economically extractable oil

● Political instability and terrorism

● The high per-barrel price that accelerates the development of alternative energies

● Safety and the need to protect workers in “hostile” environments

● The speed required to establish a presence in new markets

● Need to spread infrastructure risk among competitors

These stressors are causing oil companies to change the way they do business. From their

cooperation with competitors to their massive investments in technology, from a renewed

focus on safety and the environment to serious investigation of alternative fuels, these firms

are reshaping the industry. How they manage these changes also influences how they view

their real estate holdings and how they house the scientists and engineers who play a vital

role in this transformation.

The challenges oil and gas companies face are having a significant impact on how they view

their real estate holdings and what kind of workplaces they provide their employees. These

are important issues since many companies in this sector have vast real estate holdings. More

and more these companies are managing these holdings from an enterprise-wide perspective,

running their facilities like any other part of the business. They are realizing that facilities and

furnishings can be a strategic tool for achieving the organization’s business goals. That focus

has several implications for the workplace.

Petroleum includes all petroleum-based products, such as gasoline, oil, diesel fuel, kerosene,

refined cleaners, and solvents. Organizations involved in upstream (exploring and extracting)

and downstream activities (refining and marketing) for these petroleum products are among

some of the most profitable companies in the world.

Whether they are involved in upstream or downstream activities, whether they are public

corporations or state-owned companies, players in the oil industry must operate within the

context of significant issues and major trends that are shaping the long-term outlook for oil.

Oil companies public corporations and state and non-state-owned enterprises are faced with

increasing demand for petroleum products due to global industrial expansion.

On the one hand, labour to get the “conservative” oil (produced from underground

hydrocarbon reservoirs by means of production wells) has prompted oil companies to invest

ever more heavily in technology and equipment. On the other, these firms have increased

investments in producing “unusual” oil, including oil sands, shale oil, and extra heavy crude

oil, some of which require additional processing to produce artificial crude.

To spread the risk of investing in costly technology, equipment, and processes firms are

entering into joint-venture relationships designed to spread infrastructure risk among

competitors in order for the entire industry to remain healthy. In some cases, firms have

required mergers or acquisitions in order to expand resources for highly technical exploration

and advanced production.

Other changes on the energy scene, particularly increasing prices for both oil and gas, are

prompting several companies to take a broader view of their business. They are transforming

themselves through investments in alternative energy sources, including solar, wind, biomass,

geothermal energy, and fuel cell technology.

The realization that alternative fuels and renewable energy technologies will play an

increasingly important role as a bridge between the current focus on hydrocarbons and the

clean, cheap promise of hydrogen has prompted many oil companies to invest heavily in

these areas.
 Emerging technology to boost productivity

The technology that oil companies provide their employees is the principal perimeter,

especially where operational efficiencies can be obtained. Management requires solid

standard metrics in order to justify investing in technology.

India has steadily established itself at the core of the international production of

petrochemical and petrochemical-related products in the present state of affairs. With the

economic growth cycle slowing down in the United States, the Asian developing nations,

especially India, would preferably stand in the global petrochemical market as a producer of

these products. This is one of the major challenges facing the Indian petrochemical industry.

The oil and gas industry is shedding its yesteryear image and becoming a major adopter

of IoT, data analytics and other digital technologies. As technologies to exploit

previously unrecoverable assets mature, companies are also exploring ways to make

their businesses more efficient and effective, too.

Oil and gas companies are adopting digital technologies at an increasing pace because they

help streamline operations by making new resources more economical to recover while

improving existing processes.

Successes to date with operational digitization are improving margins, optimizing worker

safety and ensuring regulatory compliance in a dynamic marketplace. But what promise do

the technologies of the future hold?

Quantum computing, blockchain, augmented reality…we're starting to see them pop up in

other vertical sectors, but how will they help build positive outcomes in the digital oil and gas

field?
The fastest "find": edge computing

IoT is one of the two most important technological developments in oil and gas in the last

few decades: being able to granularly monitor people, equipment, vehicles and machinery is

essential to optimizing operations and is ushering in cost-saving automation, too. The second

is data analytics: collecting, aggregating and analyzing data from IoT devices goes hand in

hand.

But the newest development here is edge computing, which takes analytic power right to the

edge of the network out in the field, where the data itself is being collected. The advantage is

that when applied to detecting – or even predicting – anomalies, edge computing will "find

and communicate" the issue in near real-time versus waiting for the data to be sent to the

cloud or on-premise before it can be analyzed.

Troubleshooting from the sky

Drones are being flown by some early-adopter companies to proactively spot leaks in

pipelines or be first on the scene when there's an incident - eyes-in-the-sky for on-the-spot

emergencies where leakage, pollution or worker safety are risks. Not only can weaknesses in

the delivery chain be visualized – without the expense of sending maintenance crews out to

diagnose them – but crews can use drone footage to ensure they're properly equipped to

handle the exact issue before they arrive to fix it. This can save millions of dollars and make

inspections far safer than before.

Constructing digital models

When used in conjunction with data analysis, digital modelling helps "predict the future" by

constructing a virtual picture of field operations and using data points to assess what the

likely outcome of a specific activity may be.

For example, video footage can be used to spot potential safety issues in drilling before the

drill spins, using artificial intelligence to "spot" where a mistake may be made based on

visual markers from previous video footage. Or, 3D digital models can be developed to

visualize a new energy resource that is undeveloped and therefore under exploration. The

model uses data from similar sites that have already been exploited in order to predict likely

outcomes and focus effort where it's needed most for new ones.

Augmented reality

Augmented Reality (AR) has broken out of the "blue sky" consumer sector and is becoming

an ideal work companion for field workers. This enables workers to visualize the job ahead of

them, "see" inside equipment, streamline tasks to meet best practices, and help with

troubleshooting guidance in novel situations.

AR will have concrete benefits because it can reduce the risk of worker injury, quicken the

time to successfully troubleshoot an issue, and also help teach proper procedure in the field as

workers learn complex manual operations.

Blockchain

Blockchain is growing in popularity as the distributed digital ledger of choice for many

vertical sectors, but its inherent data security is about to be applied in the energy industry to

several different solutions.

For example, the combination of plant processing equipment, pipeline sensors and blockchain

can be used to revolutionize invoicing for products: the sensors gather the data on production

volumes, and blockchain is used to record, track and execute contracts, meanwhile detecting

fraud instances. As soon as sensors alert the fulfilment of contract terms and a contractually

agreed amount has been produced, the system executes payment.

Or, when it comes to trading energy commodities, blockchain is there, too: the amount of

time spent reconciling price and volume differences among trade participants can be reduced

by making the same data available to all parties at the same time.

Quantum computing

Quantum computing will be a big deal for the oil and gas industry as almost anywhere else: it

promises to not just improve today's classic computing performance, but blow it away,

enabling computational speeds up to 100 million times faster.

The ramifications for, say, the average oil rig where there are 30,000 sensors generating

about 1.5 Terabits of data per day, are huge. Current computing is only able to analyze about

one per cent of that information, potentially leaving assets in the ground and the rig

effectively blind to building a big data picture that could revolutionize asset recovery, worker

safety and the ongoing improvement to become more efficient.

The oil and gas industry is embarking on digital transformation to exploit new onshore and

offshore oil and gas assets, paving the way to streamlining existing extraction, refining and

distribution operations. Find out how new data, technologies and processes can help you

navigate the volatile economics of the oil and gas industry as it undergoes this change

SWOT Analysis:

The Application of Emerging Technologies in the Petroleum Industry

The application of emerging technologies in the petroleum industry is transforming the

landscape of energy production and distribution. This SWOT analysis outlines the strengths,

weaknesses, opportunities, and threats associated with these advancements.

Strengths

1. Increased Efficiency: Technologies such as AI, IoT, and blockchain enhance

operational efficiency, reducing downtime and increasing productivity.

 2. Cost Reduction: Automation and predictive maintenance lower operational costs and

minimize equipment failures.

3. Enhanced Safety: Advanced monitoring systems and robotics improve safety

standards, reducing the risk of accidents and environmental hazards.

4. Data-Driven Decisions: Big data analytics enable better decision-making through

accurate forecasting and real-time data analysis.

Weaknesses

1. High Initial Investment: Implementing new technologies requires significant capital

expenditure, which can be a barrier for smaller companies.

2. Complex Integration: Integrating new technologies with existing infrastructure can be

challenging and time-consuming.

3. Skilled Workforce Requirement: There is a need for a highly skilled workforce to

manage and maintain advanced technological systems.

4. Cybersecurity Risks: Increased reliance on digital technologies raises concerns about

data security and vulnerability to cyber-attacks.

Opportunities

1. Innovation and Development: Emerging technologies drive innovation, leading to the

development of new products and services.

 2. Environmental Sustainability: Technologies such as carbon capture and storage (CCS)

and renewable energy integration contribute to reducing the industry's environmental

footprint.

3. Market Expansion: Enhanced productivity and efficiency can lead to the expansion of

markets and increased competitiveness.

4. Regulatory Compliance: Advanced technologies can help in adhering to stricter

environmental regulations and standards.

Threats

1. Economic Uncertainty: Fluctuations in oil prices and global economic instability can

impact the investment in and adoption of new technologies.

2. Regulatory Changes: Changes in government policies and regulations can pose

challenges to the deployment of certain technologies.

3. Technological Obsolescence: Rapid technological advancements can render existing

systems obsolete, requiring continuous investment in upgrades.

4. Environmental and Social Concerns: Public perception and environmental activism

against fossil fuels can affect the industry's reputation and operations.
 PESTEL analysis

PESTEL analysis stands for ” Political, Economic, Social, Technological, Environmental and
Legal analysis and describes a framework of macro-environmental factors used in the
environmental component of strategic management. It is a part of the external analysis when
conducting strategic analysis and gives an overview of the different macro-environmental
factors that the company has to take into consideration.

Political
Political factors are the degree to which government intervention in the economy.
Specifically, political factors include areas such as tax policy, labour law, law, trade, tariffs,
and political stability. Political factors may also consist of goods and services that the
government wants to provide or be provided and those that the government does not want to
be provided. Besides, governments have great authority over the health education, and
infrastructure of a nation.
Economical

Economic factors include growth, interest, exchange and inflation. These factors have major
impacts on how businesses run and make decisions. For example, interest rates affect a
firm’s cost of capital and therefore to what degree a business grows and expands. Exchange
rates affect the costs of exporting goods and the supply and price of imported goods in an
economy.

Social

Social factors include cultural aspects and include health consciousness, population growth
rate, age distribution, career attitudes and emphasis on safety. Trends in social factors affect
the demand for a company’s products and how that company operates. For example, an old
population may imply a smaller and less willing workforce (thus increasing the cost of
labour). Moreover; companies may change a variety of management strategies to adapt to
these social trends (such as recruiting older workers).

Technological

Technological factors include ecological and environmental aspects, such as R&D activity,
automation, technology incentives and the rate of technological change. They can find
out barriers to entry, minimum efficient production level and influence outsourcing decisions.
In addition, technological shifts can affect costs, and quality, and lead to innovation.

Environmental

Environmental factors include weather, and climate. Additionally, increasing awareness of

climate change is affecting how companies operate and the products they offer it is both
creating new markets and diminishing or destroying existing ones.
Legal

Legal factors include discrimination, consumer, antitrust, employment law, and health. These
factors can affect how a company operates, its costs, and the demand for its products.
 Conclusion

The application of emerging technologies in the petroleum industry is reshaping its future,

offering significant improvements in efficiency, safety, and sustainability. Innovations such

as AI, IoT, blockchain, and advanced data analytics are transforming traditional operations,

enabling more precise and cost-effective production processes. These technologies not only

enhance productivity but also contribute to better environmental practices, aligning the

industry with global sustainability goals.

Key Points:

● Enhanced Efficiency and Safety: Technologies improve operational efficiency and

safety standards.

● Cost and Investment Challenges: High costs and integration complexities are

significant barriers.

● Environmental and Regulatory Benefits: Technologies support sustainability and

compliance with regulations.

● Economic and Technological Risks: Economic fluctuations and rapid technological

changes present risks.

However, the transition to these advanced technologies comes with challenges, including the

need for substantial investment, the integration of new systems with existing infrastructure,

and addressing cybersecurity concerns. Furthermore, the industry must stay agile to adapt to

rapid technological changes and evolving regulatory landscapes.

Overall, while the petroleum industry faces hurdles in adopting these emerging technologies,

the potential benefits far outweigh the drawbacks. By embracing innovation, the industry can
not only optimize its operations and reduce costs but also meet environmental standards and

improve safety measures. This strategic adoption of technology will ensure the petroleum

industry's resilience and competitiveness in a dynamic global market.

 Bibliography

Media Reports, Press Releases, Press Information Bureau, Ministry of Petroleum and Natural
Gas, Petroleum Planning and Analysis Cell, News Articles, International Energy Agency, BP
Statistical Review 2020

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