How tech is laying the foundation for future LNG success and compliance
The energy industry is presently dealing with immense disruption. With traditional oil markets still volatile in the wake of the Russian war in Ukraine, demand has continued to soar for LNG. In turn, the LNG industry—which was still navigating the challenges of the COVID-19 pandemic when the war broke out—has had to determine how to manage this surge in demand.
With more economies in the developing world coming online and all nations needing access to reliable and affordable energies that can help them meet sustainability regulations, LNG—as a lower carbon alternative to coal and diesel—has long been viewed as a leading candidate in helping to meet tomorrow’s diverse energy needs. However, meeting this demand has been an ongoing challenge for LNG businesses, particularly over the last decade.
Yet, while the production stresses facing the LNG industry have been widely reported, LNG businesses face a daunting question: How can they balance surging demand in a way that does not compromise safety and reliability?
The market potential for LNG operators cannot be ignored; however, this is a double-edged sword. While demand for LNG continues to climb, the potential for the industry to make costly operational safety and reliability missteps has also increased.
As the global focus on companies’ environmental, social and governance (ESG) performance grows, LNG operators are facing increased scrutiny of their risk management and regulatory compliance efforts. With LNG operators increasing production to meet demand, they need greater visibility into their production networks to avoid the environmental, reputational and financial tolls of ESG compliance oversights.
To combat this, the following are some of the ways LNG operators are embracing and deploying technology to close the gaps that exist in their ESG compliance infrastructures and emerging operational needs.
Documenting safety and reliability. Daily operations at LNG facilities can vary greatly depending on demand. The operational complexity facing LNG facilities combined with the growing importance of ESG performance means that documentation ease of use and agility have never been more important.
To create the dynamic workflow required to meet these needs, LNG operators have engaged in widespread digital transformation efforts throughout their business processes. For example, some LNG operators have eliminated paper-based permitting and replaced it with digital permitting tools to allow for seamless visibility and accountability.
In addition, LNG operators are deploying technology to get assurance that proper safety procedures (e.g., lockout/tagout processes) have been followed before any maintenance activity has taken place through real-time data inputs and reporting to ensure compliance, among other benefits.
Enabling better communication and decision-making. Digital permitting is critical for LNG facilities that use LNG trains. LNG trains operate independently and can be switched on/off as demand fluctuates. By eliminating physical permitting and digitalizing permitting best practices, LNG operators can enhance their information-sharing and decision-making, cutting down on confusion and downtime that can undermine success.
Due to the complexity of LNG facilities, LNG operators need a comprehensive system of intelligence to ensure greater safety and reliability. Adding to these challenges are the inherent risks involved with the midstream oil and gas industry, with accidents having implications for the environment and the operator’s reputation. However, many operators still rely on paper permits to work, which makes it difficult to ensure proper safety procedures are being followed.
To provide workers with the information they need when they need it and help operators ensure best practices are being followed as LNG production scales up or down depending on demand, a solution with robust online and offline mobile capabilities is extremely beneficial.
By embracing a digital-first experience, LNG operators enable their entire organization to access a single source of truth whereby real-time information on permits, isolations, hazards, simultaneous operations (SIMOPs) and more can be easily accessed. This allows for LNG businesses to make better decisions and set clear priorities vs. having to rely on guesswork. It also creates the foundation for operational ESG, leading to increased productivity and greater regulatory compliance.
Ensuring dynamic regulatory compliance and risk avoidance. As LNG production increases to meet demand, the regulatory spotlight will only become more intense. In addition, as calls for greater accountability and enforcement continue to hit a fever pitch, more responsibility is going to be placed on LNG operators to have dynamic and proactive solutions in place to maintain safety, reliability and compliance. This means making sure that documentation is auditable and gap-free.
Using digital tools allows LNG companies to back up their operations and decision-making with a clear trail of documentation that is easily accessible, auditable and accurate. Transparency is going to be a foremost feature to drive safety and a foundational element in ESG compliance moving forward. Therefore, LNG operators must establish a living record of operational practices that are clearly defined and are built on an established set of standardized policies.
Scott Lehmann
Scott Lehmann is Vice President of Product Management at Sphera. He has responsibility for defining the market-driven direction, roadmap, vertical segmentation and delivery of products. He has more than 30 years of enterprise software experience in the U.S. and Europe with small, mid-size and large companies. His focus is on empowering organizations to unlock the potential of digital transformation through forward-thinking software solutions to enable the journey to digital operations. Lehmann earned degrees from Tufts University and Georgetown University.
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