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How to innovate from core energy expertise

Perspectives

How to innovate from core energy expertise

April 12, 2021

Uwem Ukpong knows that transforming the future of energy means new approaches to technology – from incubation of promising ideas, to pivotal partnerships and industry collaborations. The Executive Vice President of Regions, Alliances & Enterprise Sales says, “innovators identify the industrial reach of Baker Hughes as the reason they want to partner with us, along with our ability to take technology into the market.” On the Baker Hughes side, building new partnerships and alliances have long been identified as the fast lane for accelerating into industry change.

 

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Uwem Ukpong, Executive Vice President of Regions, Alliances and Enterprise Sales, Baker Hughes

 

Take a project Baker Hughes is already working on with a North Sea carbon tech start-up. It’s looking to leverage an offshore carbon storage facility - the first global and full-scale carbon neutral “blue” ammonia production plant – to explore the development and integration of technologies to minimize the carbon footprint, cost and delivery time of carbon capture, transport and storage (CCTS). It’s the kind of relatively small-scale, integrated undertaking that both companies can immediately learn from and build on to help pivot others in the industry toward decarbonization and supply of a potentially highly desirable new fuel.

“The industry focus has all been about hydrogen, which will play a critical role,” says Ukpong, “but ammonia, the product of combining hydrogen and nitrogen, is easier to handle, easier to liquefy, and there’s a strong sense that it will be the fuel of the future for applications like marine propulsion.”

‘’First, you have to deal with the fact that ammonia production is one of the most heat- and pressure-intensive processes on the planet. It uses around 2 percent of the world’s energy, and in the process releases 1 percent of the global CO2 burden. The Baker Hughes Norwegian alliance with Horisont Energi has potential to bring innovation in carbon capture and offshore storage to clients in 120 markets, in a way that neither company could themselves achieve within an industry-leading timeframe.’’

Ukpong says one mistake that large legacy companies like Baker Hughes can make when transforming the extraction of hydrocarbons for a low-emissions world, is trying to change everything at once. “After you acknowledge that the industry is changing, you want to go into bite-sized projects that will help you understand how to commercially structure extraction plus carbon capture, for example, or oil extraction plus co-located blue-hydrogen and ammonia plants, in order to be successful.”

 

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Evolution of energy

Partnerships are becoming more common in today’s industry. Ukpong says, “if you want to build and deploy at the speed needed to address new opportunities, you have to recognize there is not one single player and find new ways of working.”

Raised in “an oil and gas town” by parents who both worked for an industry major, Ukpong visited offshore platforms before landing summer jobs with large-scale service providers. An engineer by training and a technologist at heart, he has navigated immense industry shifts over the past 30 years.

If you’re in the energy industry, major shifts in the market have typically forced fast change. Today’s realities are different, however, as the industry was already undergoing major change. In 2020, a downturn and global pandemic put emphasis on productivity and efficiency but also clean energy and decarbonization. A volatile market increases willingness to adopt new technologies to meet these goals.”

Although implementing efficiencies — think supply chain optimization and leveraging remote-operating capabilities — has an important place in the immediate response to the current market volatility and conditions imposed by the COVID-19 pandemic, Ukpong says decarbonization has become by far the most important strategic factor for oil and gas companies to consider. He says, “You may not want to become a renewables company or a hydrogen company, but you’re not going to be given a pass on not having a clear decarbonization roadmap for your operations.”

 

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Even before COVID-19 became the context for industry decision making, the new era of decarbonization had begun to favor collaboration over blunt “don’t call us, we’ll call you” tender processes, says Ukpong. Oil and gas companies from the majors down to the smaller operators now regularly request meetings with Baker Hughes to understand the technology options before planning their next moves. This early-engagement process favors better integration of solutions, and investments can therefore be seen to deliver greater enterprise-wide positive impact.

 

Digital remains a priority

Digital transformation, a longtime goal of the energy industry which has so far developed in fits and starts rather than leaps and bounds, remains a priority. Ukpong is confident that digital technologies will help meet both near-term efficiency requirements and decarbonization mandates.

Drones enabled by advanced analytics, for instance, are increasingly used for a variety of tasks, including predicting pipeline corrosion and monitoring of emissions from methane plumes. In the latter instance, the airborne observer captures images of the almost invisible leaks, which when subject to pattern recognition software reveal how much methane is being discharged into the atmosphere.

“Energy management is also a big topic from an AI perspective,” says Ukpong.

''Energy management is also a big topic from an AI perspective''

Uwem Ukpong, Baker Hughes

The Baker Hughes strategic alliance with C3 AI, announced in June 2019, is expanding such capabilities. A focus for Ukpong as he delivers on the promise of technology alliances, BHC3 brings together the domain expertise of Baker Hughes with AI software from C3 AI to drive previously unidentifiable pathways to greater productivity and create new opportunities for the oil and gas sector. He says, “As companies look to do more with less, it’s essential that we can provide a solid digital framework to be able to help our customers get more out of our equipment and their operations."

“Rather than trying to build a hardened AI platform in-house,” he adds, “we’ve partnered with the best in the industry.”

 

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The opportunities in adversity

In a world characterized by an abundance of energy resources, millions of people for whom access to electricity has not yet been realized, a legacy global reliance on petroleum products and the constraining threat of global warming, the challenge is to get the mix right.

By redefining itself as an energy technology company, Baker Hughes has grasped the license to apply innovation and new ways of thinking to its long heritage of industry experience. Our strategy, says Ukpong, is “to transform our core operations, invest in growth, and position for new energy frontiers.” There is enormous potential in the energy transition, he says, as the company’s executive leadership team aims to place the right bets and facilitate moves that ensure the ongoing success of Baker Hughes and its clients.

''Our strategy is to transform our core operations, invest in growth, and position for new energy frontiers.''

Uwem Ukpong, Baker Hughes

Ukpong adds that it is incumbent on all energy leaders to acknowledge and embrace the imperative to change, and to “put in place the mechanisms to be able to adapt in a smart way.”

 

 

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