Cyient's SVP of Energy & Utilities business, Katie Cook, shares her thoughts with Chemical Engineering World on how COVID19 is impacting power generation, mining, and oil and gas industries and how road to recovery will look.

1. CEWGuest Column
Road to Recovery for Energy Industry
A
t the time of writing this article, WHO
estimates suggest that the COVID-19
pandemic had spread to more than
200 countries worldwide, with the number of
positive cases inching closer to the 2 million
mark.
As the world comes to terms with the “new
normal” of life and way of working in a
lockdown, businesses are charting new paths
to navigate through this unprecedented time.
From shaky commodity prices, mounting
economic pressures, supply chain disruptions,
and unfamiliar work environments, energy
operations as a whole are being significantly
affected. This impact must be addressed on
priority as the energy sector plays a critical
role as an essential service for consumers and
businesses. How are the power generation,
mining, and oil & gas (O&G) industries getting
impacted by this new world?
Power Generation
The power generation industry is witnessing
a significant impact of the pandemic since the
beginning of 2020, with the demand curve
taking a new, unprecedented shape. To
maintain electricity supplies, nuclear reactors,
along with fossil fuels and renewable power
technologies, will play a critical role. The need
to reduce the use of fossil fuels due to climate
change concerns in favor of low-emissions
power sources, continues to be a focus area.
Any breakdown in the supply of power can
lead to widespread disruption, as we have
seen during outages caused by wildfires
and other natural or weather-related factors.
Supply chain disruption is likely to push
power generation companies to focus on
improving reliability and bring operational
efficiencies that could help them tide over
these challenging times.
Oil & Gas
The COVID-19 pandemic, coupled with the
supply-side shock in the form of continued
production by OPEC and Russia, has added
further pressure on the price of crude pushing
it below the critical $40/barrel mark. This
makes offshore exploration and fracking
economically less viable, and forces O&G
companies to look at other avenues such as
onshore oil drilling. We anticipate companies
to adopt a cautious approach toward capital
expenditure in the immediate and short-term
while focusing on asset optimization and
operational efficiency to derive maximum
value in the interim.
Mining
Varying degrees of lockdown in countries
across the globe combined with disrupted
supply chains due to travel and cargo
restrictions and the prevalent economic
sentiment has brought non-essential industrial
production almost to a grinding halt. This
includes automotive, aerospace, engineering,
and construction, as well as infrastructure
development, which is among the biggest
consumers of metals. This blow comes at
a time when the sector was already dealing
with environmental issues and tariff wars in a
slowing global economy. While the industry
balances the fine line between demand and
supply, a key area of focus in the short-term
would be lowering the cost of operations.
The Road to Recovery
As energy companies shake-off the initial
upheaval and set off on the road to recovery,
what are the top priorities for them, and
what role will technology play in doing it
successfully?
Increased Focus on Workforce Safety
Given the health risks associated with the
pandemic, the people-intensive nature of
all three industries and the geographical
distribution of natural resources across the
globe have brought the safety and well-being
of the workforce to the forefront. To ensure
continued supply, companies will need to
innovate remote working models by leveraging
digital tools and emerging technologies across
their value chain.
The Emergence of New Team Structures
A distributed workforce is a relatively lesser-
known concept within the energy sector
because of the critical and sensitive nature
of the business. Worldwide lockdowns have
compelled operators and their extended
teams to take unprecedented measures that
enable teams to work from their respective
locations. This crisis has served as a proof
of concept that a diversified, dispersed, and
flexible team can ensure quality delivery of
engineering and operational services even in
such times.
Process Automation for Service Reliability
As operators look to ensure uninterrupted
service in trying times like now, it is an
excellent opportunity for operators to fast-
track their process automation initiatives.
Applying disruptive technologies to automate
as many processes as possible will be an
accelerated focus to ensure environment
and workforce safety as well as operational
reliability.
Increased Focus on Digital Transformation
and Asset Management
As operators focus on lowering operational
expenses, existing assets and infrastructure
will be under added pressure. Businesses will
be required to do more with less by focusing
on effective infrastructure management and
making their assets smarter and resilient.
The application of disruptive solutions, such
as connected equipment and predictive
maintenance, paired with strong asset
management strategies, could hold the key to
achieve operational efficiency.
The COVID-19 pandemic will transform
industries as we know today. It is critical
that companies embrace access to data and
technology as a key differentiator to drive
safety, automation, and efficiency.
Author Details
Katie Cook
Sr. Vice President
Energy and Utilities, Cyient