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Market & Technology Trends

Understanding Cloud and SaaS Growth in the Oil & Gas Industry.

The term “cloud computing” rose to popularity around 2006 as it was adopted by large tech companies such as Google and Amazon. However, it is still an often misunderstood term that encompasses many different service offerings and IT environments. Since the creation of WellEz in 2000, the hosted Software-as-a-Service solution has brought the cost and functionality benefits of the cloud to oil & gas operators.

As of 2015, the IT industry is seeing huge investments in cloud computing. We see many examples of companies, including major players like Oracle and SAP SE, moving their software to online or cloud offerings.  WellEz is unique in this industry transition in that it isn’t making one. From the first line of code, it was already designed to exploit the benefits of the cloud and a SaaS model.

Even as we see the shift in the IT industry, we occasionally find colleagues in oil & gas that are hesitant to adopt the new technology that they do not fully understand.

Understanding the Cloud

Cloud computing – Term that describes a variety of data storage, processing, and application services. They can typically be defined in three levels:

SAAS – Software as a Service: Special purpose applications that perform a business function

PAAS – Platform as a Service: Development platform to build, manage, and utilize cloud-based applications

IAAS – Infrastructure as a Service: Raw processing power, memory, data storage

 

 

True cloud services can be accessed, on demand, using a variety of devices such as a desktop computer, laptop, smartphone, or tablet. Since the computer ‘muscle’ resides in the cloud, the device used to access the application can be relatively inexpensive.

Cloud services are normally provided as a subscription (based on number of users, amount of data, etc.) and can be rapidly scaled so that the resources needed by a customer are always available. However, the customer only pays for the services it uses.

General Benefits of the Cloud

Cost – Cloud data centers are massive and located around the world to guarantee 100% uptime. This allows cloud providers to take advantage of economies of scale. The cost of network access for a typical company’s data center with 1,000 servers is $95/Mbps/month. For a cloud data center, that cost can be around $12/Mbps/month, a 7 to 1 ratio.  Similar savings apply to storage and administration costs.

Convenience – Cloud services are easy to commission, access, and deploy. Once they are deployed, application updates can be rolled out immediately to all users instead of being sent to numerous individual installations. There are no delivery costs and the provider does not carry the overhead of developing for legacy versions of the applications.

Competencies – Cloud services remove overhead from IT and operations departments, allowing them to focus on their expertise. The effort and workforce needed to support and maintain servers can be deployed in other parts of the business.   

Oil and Gas Issues with the Cloud

Even with the overwhelming benefits, we still see a percentage of our industry with apprehension or mistrust for moving their business applications to the cloud. In our experience, the core issue revolves around security. Decision makers are asking themselves the question “How safe is my data?”

All companies who use the cloud are concerned with security. However, depending on the service obtained, expectations should be adjusted. For applications built with a SaaS model, maintaining customer’s data securely while providing easy-to-use functionality is paramount. Applications like WellEz offer a role-based permissions system that allows administrators to partition access to the individual user’s job function. Applications are often fully auditable, allowing administrators to track any changes to the data.

Another question that operating companies pose when evaluating cloud-based solutions is “Who owns my data?” In the case of WellEz, the customer fully owns all rights to their data collected via the application.  We even send customers a copy of their database via a secure feed each night. This allows them always to have the most up-to-date version of their data, and integrate it with other business applications.

With oil & gas operators looking for areas to cut costs and optimize operations, the benefits of cloud-based application and services are becoming more appealing.  Applications like WellEz provide companies, greater operational efficiency, better business agility, and help transition their employees to the modern energy workforce.  To learn more about cloud-based well lifecycle reporting with WellEz, watch our demo!