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The Abu Dhabi National Oil Company (ADNOC) and IBM have successfully piloted a blockchain-based automated system to integrate oil and gas production across the full value chain
The system will provide a secure platform for tracking, validating and execution of transactions at every stage, from the production well to the end customer, ADNOC said in a press release.
According to ADNOC, using Blockchain technology will reduce the time it takes to execute transactions between ADNOC’s operating companies and significantly increase operational efficiencies across its full value chain. It will also improve the reliability of production data by enabling greater transparency in transactions.
The project was announced by Abdul Nasser Al Mughairbi, ADNOC Digital Unit Manager, at the World Energy Capital Assembly, in London.
Al Mughairbi said, “We believe this could be the first application of blockchain in oil and gas production accounting anywhere in the world. It demonstrates how ADNOC is leveraging innovative partnerships to unleash the power of technology and creative thinking to enhance efficiencies and deliver greater performance.
“Blockchain is a game-changer. It will substantially reduce our operating costs by eliminating time-consuming and labour-intensive processes, strengthen the marketing and trading of our products, and create long-term sustainable value that will ensure that ADNOC delivers on its 2030 smart growth strategy,” he added.
The pilot provided a single platform that tracks the quantities and financial values of each bilateral transaction between ADNOC’s operating companies, automating the accounting process, the company explained.
Zahid Habib, IBM’s Chemicals and Petroleum Solutions VP, added, “With this pilot, ADNOC takes a massive leap forward in asset provenance and asset financials, which, in its simplest terms, enables the ability to track irrefutably, every molecule of oil, and its value, from well to customer.”
“This unlocks the potential to digitally reinvent ADNOC’s hydrocarbon value chain, adds a unique dimension to their data visualization in their Panorama Digital Command Centre, and accelerates ADNOC towards their 2030 Vision,” he stated.
As the Blockchain application is expanded, it will eventually be linked to customers and investors, providing seamless integration among stakeholders. This enhanced clarity and transparency will reduce inherent business risks and consequently enhance the attractiveness of ADNOC Group as an investment partner, the statement concluded.