Page 5 - NorthAmOil Week 45

NorthAmOil COMMENTARY NorthAmOil
major changes to its operations. “It’s certainly our first partnership of this kind in Western Canada,”Kennedysaid.
Suncor 4.0
The changes Suncor is seeking to make fall under what Little has previously described as “Suncor 4.0” – the company’s fourth major transformation.
The first of these transformations was the establishment of the company’s initial oil sands mine in 1967. This was followed by the imple- mentation of new technology at the mine that drove oil sands growth in the early 1990s, and the third transformation was Suncor’s merger with Petro-Canada in 2010.
The fourth transformation is aimed at bringing about a digital age for the company. Suncor has already taken several other steps in pursuit of this goal. For example, it was the first oil sands producer to announce a move towards fully autonomous trucks at its mines. It also tracks and analyses frontline maintenance work at its Fort Hills and Firebag projects, as well as its oil sands upgraders, through wireless badges worn by employees. The data-gather- ing effort is aimed at improving both safety and productivity.
Now Suncor is hoping to benefit even more from the data it gathers thanks to its access to Microsoft’s cloud technologies. Suncor’s senior vice-president of digital and enterprise technol- ogy, Sandy Martin, told the Financial Post that once gathered and uploaded to the cloud, the company’s data will be subject to new analyses and augmented with artificial intelligence (AI) and machine learning.
According to Martin, the digitalisation of Suncor’s systems is one way the company is try- ing to achieve its goal of generating an additional CAD2bn ($1.5bn) in incremental cash flow by 2023.
If digitalisation is seen to help Suncor achieve this goal, it could encourage other oil producers
– in the oil sands and beyond – to adopt similar technologies. Ever since oil prices collapsed in 2014,producershavebeenunderpressuretocut costs and generate cash flow. Indeed, for some this was an obstacle to the adoption of new tech- nologies. However, the providers of those tech- nologies have argued that there are considerable savings to be made and efficiencies to be gained through digitalisation. The more producers are able to demonstrate this, the more of their peers will likely move in the same direction. For other companies, the adoption of new technologies can be driven by fear for the future as much as by the appetite for savings.
“If you think into the future – and wherever that future is – there isn’t an environment where any company survives without becoming digi- tal,” Martin was quoted as saying. “So we view this as a competitive advantage to be digital before our competition.”
Suncor and other oil sands producers still have a long way to go when it comes to turning around the public image of their industry. How- ever, with Canada ranking as the fourth largest producer of crude globally in 2018, the indus- try is not going anywhere – and indeed, may become an increasingly popular source of sup- ply as heavy oil production elsewhere declines. In 2019, for example, US sanctions against Ven- ezuelan state-owned producer PdVSA came as a further blow to the Latin American country as it was already struggling with declining output. Meanwhile, refiners on the US Gulf Coast and elsewhere are still predominantly geared to pro- cessing heavy crude such as that from Canada’s oil sands. And Canada has been keen to promote itself as a source of stable supply amid volatility elsewhere.
Thus despite the challenges they face, oil sands producers continue to explore new ways of expanding their operations. Suncor now hopes that cloud computing and digital technologies could result in a step change that gives it the edge over its competitors.™
The changes Suncor is seeking to make fall under what Little has previously described as “Suncor 4.0”.
Suncor tracks and analyses frontline maintenance work at its Fort Hills facility, among others, through wireless badges worn by employees.
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