The oil and gas sector is facing pressure from every direction. Greenhouse gas (GHG) emissions, renewable energy mandates, and the push for low-carbon alternatives are reshaping how companies explore and produce energy.
What worked five years ago doesn’t necessarily work today.
Here’s where the industry stands right now, how it’s changing, and what operations leaders need to watch as they develop an oil and gas strategy that balances traditional production with environmental demands.
Understanding the Challenges
Oil and gas operations face pressures on multiple fronts, from stricter environmental regulations to a shrinking workforce. Leaders must navigate these challenges while keeping production efficient, safe, and compliant.
Economic and Geopolitical Instability
The oil and gas industry has been significantly impacted by macroeconomic and geopolitical factors. The COVID-19 pandemic severely disrupted fuel demand and transportation, while ongoing conflicts, such as the war in Ukraine, continue to affect supply chains.
The International Energy Agency has reported disruptions in crude oil production capacity across countries within and out of the Organization of the Petroleum Exporting Countries (OPEC), driving price instability and tightening global supply.
These changes have highlighted the vulnerability of the industry to external shocks and the need for more resilient operational strategies.
Environmental and Regulatory Pressures
As global awareness of climate change grows, oil and gas companies are under increasing pressure to reduce their environmental footprint.
The industry is highly regulated, with constantly evolving policies aimed at achieving carbon neutrality and limiting global warming. Compliance with these regulations adds another layer of complexity to operations.
Talent and Workforce Challenges
The oil and gas sector is also grappling with a talent shortage. U.S. oil production has hit record highs, yet employment in extraction is still down nearly 20% from pre-pandemic levels, underscoring the sector’s workforce challenges.
Additionally, the industry struggles to attract younger generations, who are increasingly seeking remote work opportunities and careers focused on mental health and wellness.
Need more insights?
Download our State of the Market 2024: Oil & Gas Field Service Report
Infrastructure and Asset Aging
Pipelines, rigs, and refineries often operate for decades beyond their intended lifespan. The older they get, the higher the risk of failures, accidents, and costly unplanned downtime.
Regular inspections and maintenance are critical. Many assets are located in remote areas, making it a logistical challenge to track activities and coordinate teams.
Mobile data collection platforms standardize inspection workflows, flag potential failures before they happen, and work offline where connectivity drops. This helps teams catch problems early, keep assets running, and prevent downtime.
Data Fragmentation and Lack of Real-Time Visibility
Many oil and gas companies still run on fragmented data systems, siloed departments, and paper-based field reports. Information gets stuck between the field and the office. Technicians fill out forms that take days to process.
Managers make decisions based on outdated data. When markets shift or equipment fails, response times lag because leaders don’t have the complete picture in real time.
Digital platforms can unify field data the moment it’s captured, giving operations leaders visibility into what’s happening across remote sites. Real-time reporting means faster decisions, better resource allocation, and fewer surprises.
What’s at Stake for Operations Leaders
Operations leaders in oil and gas are watching costs rise. Aging assets demand more maintenance, but inefficient cycles waste resources and still lead to unexpected failures. The workforce keeps shrinking while regulatory scrutiny intensifies.
One safety incident or compliance failure can trigger hefty fines and cause reputational damage. Supply chains remain unpredictable, making it harder to maintain service levels customers expect.
Modern operations leaders need digital transformation for basic continuity, cost control, and scalability. Companies that delay digitization will find themselves managing crises instead of preventing them.
The question isn’t whether to invest in operational technology, but how quickly you can implement systems that give you real-time control over remote assets and distributed teams.
Operational KPIs for the Energy Transition
Operations leaders need to track environmental performance the same way they track production metrics. Sustainability requires new key performance indicators (KPIs) that connect decarbonization efforts to operational results.
Key metrics include:
- GHG emissions per barrel produced.
- Maintenance backlog reduction rates.
- Asset uptime improvements.
- Safety incident frequency.
- Energy efficiency gains.
Digital platforms can make tracking Scope 1, 2, and 3 emissions more manageable. Instead of quarterly estimates, operations teams can monitor real-time data from field activities. Mobile workflows capture energy consumption, waste generation, and resource usage as work happens.
When maintenance reduces leaks or equipment upgrades cut power consumption, the environmental impact shows up immediately in dashboards alongside traditional performance data.
Balancing Energy Transition and Core Oil and Gas Business
Oil and gas strategy now requires running two approaches simultaneously: Maximize profits from current operations while preparing for a cleaner energy future. Most companies aren’t walking away from oil and gas production. They’re making it more efficient and less polluting.
Natural gas serves as a “bridge fuel” because it burns cleaner than coal or oil. Companies are building gas infrastructure while testing carbon capture and hydrogen projects. This keeps revenue flowing from traditional sources while companies develop new capabilities.
Different emission types require different approaches. Companies target operational efficiency to cut direct emissions, switch to renewable electricity for facilities, and work with suppliers on broader value chain impacts.
Digital platforms track performance across oil, gas, and renewable projects, helping leaders see where to allocate resources and show progress to investors.
Strategic Priorities for a Changing Oil & Gas Landscape
To address current challenges, embrace a forward-thinking oil and gas strategy centered on innovation and digital transformation. Here are the key components of this approach.
1. Leveraging Predictive Maintenance
Predictive maintenance in oil and gas is crucial for minimizing unplanned downtime and extending the lifespan of assets. By utilizing data analytics and machine learning, companies can predict when equipment failures are likely to occur and address issues proactively.
This approach not only reduces unexpected failures but also optimizes maintenance schedules and improves operational efficiency.
2. Implementing Digital Twins
Digital twins, virtual replicas of physical assets, enable real-time monitoring and simulation. By creating digital twins of critical equipment, companies can simulate different scenarios and predict the impact of various factors on asset performance.
This helps in making informed decisions and implementing preventive measures to avoid potential issues.
3. Enhancing Workforce Efficiency with Mobile Apps & Workflows
Mobile technology empowers field service engineers (FSEs) with real-time access to data, tools, and resources, regardless of their location. Mobile apps can provide engineers with step-by-step guidance, remote diagnostics, and instant access to technical support.
This enhances their ability to address issues promptly and accurately, reducing downtime and improving service quality.
4. Investing in Automation and IoT
Automation and the Internet of Things (IoT) can streamline routine tasks and enhance data collection. Automated systems can monitor equipment continuously, send alerts when anomalies are detected, and even perform corrective actions automatically.
This reduces the burden on engineers and ensures potential issues are addressed swiftly.
5. Focusing on Safety and Compliance
A modern oil and gas strategy must prioritize safety and regulatory compliance.
Automation technology can harness the power of existing field intelligence in the form of guided workflows, which not only help onboard new FSEs but also reduce the burden on veteran workers to support newcomers.
Guided mobile workflows provide well-defined compliance processes, regulatory guidance, and audit trails, ensuring accuracy and minimizing the risk of human error.
6. Reducing Friction and Enhancing Employee Engagement
Employee engagement is crucial for attracting and retaining quality talent. Friction in field service, such as inefficient processes and inadequate access to knowledge, tools, or equipment, is a significant contributor to low employee engagement.
By leveraging automation technology to eliminate administrative tasks and streamline the intelligence needed for engineers to do what they enjoy — helping customers and fixing things — companies can enhance employee satisfaction and reduce turnover.
7. Transitioning to Proactive Service Delivery
Proactive service delivery is essential for meeting the evolving demands of customers and ensuring operational efficiency. Preventive and predictive delivery models reduce reliance on talent, as emergency cases become fewer and farther between.
Intelligent data capture technology provides the contextual data needed to minimize asset downtime and power proactive maintenance, ensuring service quality and customer satisfaction.
8. Driving Environmental Performance and Decarbonization
Oil producers are integrating sustainability into operations without abandoning traditional oil production. They’re investing in renewable energy projects while making current fossil fuel operations cleaner and more efficient.
Decarbonization became a strategic priority because of investor and regulatory pressure. Environmental, social, and governance (ESG) targets and net-zero goals create financial incentives for environmental performance.
Companies that can’t show progress face higher borrowing costs and limited capital access.
Mobile platforms help track environmental performance in real time. Technicians monitor emissions, energy use, and waste during routine work. The data feeds sustainability reports and helps teams find improvement opportunities.
Environmental gains often lead to operational savings.
Need more insights?
Download our State of the Market 2024: Oil & Gas Field Service Report
Future-Proofing Strategy in the Energy Industry
Oil and gas operations are under pressure from multiple directions. Digital tools and mobile workflows have become essential for managing aging infrastructure, shrinking workforces, and increasing environmental demands while keeping operations profitable.
Oil and gas companies must balance two priorities: driving economic growth from existing assets while investing in green energy and future-ready infrastructure. The companies that succeed will optimize traditional operations while building capabilities for the energy transition.
Mobile platforms help manage both sides of this equation by providing real-time visibility into field operations, environmental performance, and asset health.Book a demo to see how TrueContext can support your business and operational strategy.
