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Exploring obsolescence management

Published:  13 June, 2016

Jonathan Wilkins, marketing director of industrial automation supplier EU Automation discusses how the oil and gas industry can manage the spiralling issue of equipment obsolescence.

On Earth, it’s hard to imagine a more alien place than the unexplored environment of the deep sea. For the Attenborough enthusiasts among us, bizarre, bioluminescent creatures are what usually come to mind when we consider an ocean’s 3,000 ft depths. But by employing cutting-edge technology, these incredible depths are set to become the locations of large production sites for the subsea oil and gas industry. Rapid technological advancements have the potential to make these innovative sites a reality as early as 2020. With technology racing ahead, it’s unsurprising that obsolescence management in the industry is complicated.

Today, the vast majority of the developed world is heavily reliant on the oil and gas industry. It accounts for a huge percentage of our global energy consumption and as a result, has become a thriving, but incredibly challenging industry. Battling through worldwide economic turmoil, complicated regulations and erratic price swings, organisations in this sector have been forced to innovate in order to survive. In the ongoing fight to compete with untamed competition, companies have needed to find ways to increase efficiency and cost-effectiveness, without breaking the bank.

If there’s one solution that comes out on top for the sector, it’s industrial automation. Estimated to be worth $32.14 billion by 2020, today’s automation solutions for oil and gas are more complex and advanced than ever. Moving beyond simple machine control, modern industrial technology allows organisations to intelligently manage and understand their production processes in a way they have never done before. What’s more, by implementing effective supervisory control and data acquisition (SCADA) systems and programmable logic controllers (PLCs), oil and gas organisations can gain access to real-time production data, providing complete visibility of the manufacturing process.

Despite these advancements, some industrial components have disappointingly short life spans. For the oil and gas industry, an unexpected failure is more than a simple business inconvenience. In an industry where downtime costs more than anywhere else, broken down parts can translate to millions in unplanned business expenditure.

What’s more, many oil and gas manufacturers often find the industrial automation equipment they use is no longer made by the original equipment manufacturer (OEM). The fast paced nature of the automation market means that instead, some OEMs will focus on producing newer models and improved versions, leaving older parts to become obsolete.

Luckily, ‘obsolete’ doesn’t mean a part is unattainable. In fact, although choosing to upgrade to a newer, but undoubtedly more expensive, piece of equipment might seem like the easy option, you might be surprised by the benefits of sourcing obsolete.

Decreasing oil and gas supplies have been pushing the offshore industry deeper underwater and further offshore, meaning the risks associated with disrupting the infrastructure is ever increasing. Opting to source your obsolete component allows for seamless integration into the existing system and ultimately, protects you from the risks associated with integrating new technology or machinery into an existing structure.

In addition, sourcing an obsolete part isn’t as complicated a procedure as it may sound. European Automation can locate can deliver automation parts to anywhere in the world in record time, getting production back up and running with minimal downtime.

Roiled by economic chaos, organisations in the oil and gas industry are under high pressure to keep up with their competitors. Just like they explore the oceans in more and more depth every year, oil and gas companies must be willing to delve into unchartered territory and consider technological innovations that could change the way they operate. While embracing such new technologies, strategies to manage the inevitable obsolescence of current industrial automation systems must develop too: onshore, offshore and on the ocean floor.

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