How Technology is Transforming Houston Industries

With oil and gas dominating 55% of Houston industries, the rise of high-tech enterprises has cast a light on the industry’s stone-age approach to technology.

From IoT applications, AI and cloud computing, learn more about how the oil and gas industry is poised for a digital evolution to transform the Houston energy industry and beyond.

With oil, gas and energy representing the majority of the city’s business, the market tends to hum along at a relatively steady pace. In fact, year-over-year, Houston adds nearly 88,000 jobs to their local workforce. Due to its large presence of oil and gas enterprises, the city has long been running off of steam built up from a 2003 oil boom that introduced almost 700,000 new jobs up until 2014 when the industry started to experience a slight slow down. Thanks to this boom, Houston’s economy was able to sustain itself throughout a nationwide downturn in the oil industry. 

It’s no secret that Houston has long dominated the oil industry. Today, there are currently about 175,000 employeesworking in oil and gas in Houston alone. But in recent years, the city has also begun to see pretty hefty growth throughout their high-tech ecosystem—so much growth that the city has acquired the catchy pseudonym ‘Silicon Bayou.’ After being trademarked as a major hub for the oil and gas industry for so long, it may come as a surprise to see an influx of tech companies in Houston. But between the low cost of living and extremely knowledgeable workforce, the city boasts many benefits on the business front. 

As this influx of new technologies and their associated enterprises continue to pick up momentum, it’s become increasingly interesting to look at how this innovation is impacting other Houston industries. With an economy where 55% of business revolves around the oil and gas industry, technological innovation has historically been slow to evolve. 

With so many advancements in smart tech & IoT, the oil and gas industry is often perceived to be a passe sector in a long decline, reliant on defunct technologies. But is that really the case? And if so, what’s driving fossil fuels’ lagging technology adoption? Yes, implementing new technologies can be unpredictable and expensive; but in a multi-billion-dollar industry dependent on efficiency, digital evolution is critical. 

At Skybox Datacenters, we love exploring industry-leading technologies and innovations that can deliver value to our work and our customers. Below, we’re discussing some of today’s technical advancements and the benefits they provide, as well as the impact they may have on the Houston energy industry and beyond.

IoT Applications

In a 2015 report, McKinsey found that the IoT (Internet of Things) could have an economic impact of about $11.1 trillion by 2025. For the oil and gas industry, IoT applications are in a position to offer support in safety, extraction, preventative maintenance, regulation and much more. The extraction process is a time-heavy, resource-intensive process that takes place in extremely remote locations across the state. Likewise, regular maintenance on heavy equipment can be a dangerous process. With IoT, companies can implement automated software strategies that not only reduce time investment, but also troubleshoot potential issues before they get worse. From equipment malfunctions to improper field operations and predictive spill risks, implementing IoT applications can allow for processes to be streamlined, accidents to be prevented and risks to be mitigated. 

Artificial Intelligence

In the context of oil and gas, artificial intelligence is applied primarily via machine learning. Much like IoT, artificial intelligence opens the door for automation to simplify complex processes and cut operational time exponentially. With AI, companies have the ability to implement specific data models that enable computer and machine learning for many different purposes. Whether it’s complex calculations, analytical reporting, or pattern discovery, AI is a great tool for oil and gas enterprises to add to their software infrastructures. Not only is it valuable for integrating data models, but AI is also a scalable software solution allowing companies to add programs, cut programs and alter programs as needed. 

AI has already had an impact in the industry. This past spring, the Oil and Gas Repository launched an AI-driven National Data Repository. Utilizing around 130 terabytes of data collected from geophysical, infrastructure and field research, the NDR analyzes information from more than 12,500 wellbores, 5,000 surveys and 3,000 pipelines. That’s a lot of data—and thanks to AI processing, OGR can easily analyze this information, a nearly impossible task otherwise. 

Colocation & Cloud Computing

Third party colocation, coupled with a strong cloud computing partner, has been dubbed the “next big thing” for the oil and gas industry, and rightfully so. With so much data and information that requires constant processing, energy companies need a solution that allows them to analyze data in an efficient, secure way. Not only are they looking for secure data storage, but energy businesses also require an exceptional level of interconnectivity across systems and platforms. While cloud computing does offer long-term data storage, this massive accumulation of data coupled with a required, consistent interconnectivity requires high levels of expertise and hands-on management—creating a greater need for companies leverage data partners for hosting support. 

While IoT, AI and cloud computing all have their distinct differences, one similarity worth noting is the volume of data each technology can extract, process and analyze. Not only do these technologies enable oil and gas companies to participate in the ongoing digital evolution but open the door to more efficient processes that will ultimately cut time and costs. In an industry that’s older than the dinosaurs and hesitant to adopt technology, there’s massive potential impact lying in the modernization of the oil field for O&G enterprises. 

We often talk about the benefits of data center colocation, but the value and volume of data lying within the oil and gas industry, specifically in our local Houston market, points to the pressing need for qualified proximate data center partners. Not only will it give you peace of mind knowing your data is secured from both internal and external threats, but you also have access to expert IT management to offer additional support as well as full scalability. Whether you have a 3Kw or 15 MW company, partnering with a data center can make a meaningful difference in your business and add unique value to your IT solutions. 

To learn more about Skybox Houston and the services we offer, schedule a call today—we would love to hear from you.