By The UAE-based Abu Dhabi National Oil Company (ADNOC) recently announced a partnership with tech giant IBM in order to pilot a blockchain-based transaction management system for all their commodities across the value chain, from oil wells right to customers.
This automated, blockchain-based system will include oil & gas production management for all of ADNOC’s value chain and this includes tracking, validating, executing and of course transactional data.
As is the case with many of these blockchain-based pilots that have been implemented across various industries this past year, this one is expected to drastically increase the efficiencies as well as aid in improved stakeholder transparencies. The key difference here, however, is that this pilot’s application will affect the entirety of the oil & gas lifecycle whereas other pilot programs have only focused on specific aspects of supply chains such as trade or post-trade processes with ADNOC also planning to include customers and investors at later stages of the rollout.
IBM’s Vice President of Chemicals and Petroleum Solutions – Zahid Habib had this to say:
“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.”
ADNOC’s pilot will actually track quantities as well as financial values of oil products from the journey from well to refinery all the way to exporting. The application will also include gas, condensates, sulphurs and natural gas liquids.
Introducing The First Blockchain-based Oil & Gas Accounting System:
ADNOC’s project was announced at the recent World Energy Capital Assembly which was held in London. Dubbing blockchain tech as a “game changer”, Abdul Nasser Al Mughairbi, ADNOC’s Digital Unit Manager stated that the tech could:
“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.”
He also believes that their pilot is:
“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.”
As reported by CoinBeat last month, BP & Shell’s blockchain-based oil trading platform “Vakt” went live late November. The consortium tied to Vakt includes Gunvor Group, Equinor, Koch Supply and Trading, and Mercuria Energy Group as well as banking giants Societe Generale, ING, and ABN Amro.
As reported at the time, Vakt focuses on commodity management all the way from trade entry to final settlements. It was launched privately to a handful of key members from the consortium with a wider launch to the general public being opened up as early as January 2019. Vakt has also announced plans to implement a financing management system by joining forces with another development in the industry, this being the “Komgo” blockchain pilot at a later stage.
With all these energy titans investing in blockchain pilots to streamline their processes, could this spark the adoption hype that blockchain technology needs in all industries? Let us know your thoughts.
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