Keeping with the times

Hasnor Hashim, Principal Engineer at PETRONAS, talks machine learning, pandemic blues, and the future of the energy industry.

What does a typical day in your role look like? What are your biggest challenges and priorities?

I’m currently working with the PETRONAS centralised technical team. Basically, we are supporting all our assets upstream and downstream and most especially on the process modelling site. So what we do is we take all the data available from the plants, we do process models and use that to do a variety of things, for example, troubleshooting, optimization, as well as developing digital applications to help have a better view of the process equipment performance, and also the economics of running the assets.

With the market and world going through such a critical moment, how would you say the current pandemic has affected your role and the digital applications you previously mentioned?

Technology  application is very critical at this juncture, because the oil and gas industry as a whole is  really trying to push a cost down, you know, trying to maximise our production and at same time reduce costs. And the only way we can do that is to really utilise all the data or digital tools that we can and try to find any areas, any potential increment in production that we can find, or anticipate any potential equipment failure that disrupts operations.

And we can also minimise a lot of travelling time to the locations because using digital, we can get data straight from our office, they can do an analysis, and pretty much the result and the turnaround of the analysis will be quite fast as compared to previously where we had to go and search the data manually.

It’s interesting that you mentioned utilising an analysis of data. Can you share an example of how PETRONAS is analysing and utilising data, particularly at this critical moment?

We utilise the data at several levels. For example, at equipment performance level, we are utilising data to predict potential failures and also plan for shutdown and for repairs, because we want to avoid unplanned shutdown. And we’ll also look at the highest level across the enterprise where we track molecules movement from upstream to downstream and we really optimise the molecule movement throughout the value chain of the enterprise. 

One thing the market is saying is that vertical integration is a way that operators are going to streamline business operations in the next normal. What are your views on that and what role do you think vertical integration between downstream midstream and upstream will play in the next normal of the oil and gas industry?

Right now we have to produce whatever the market is required. I think we cannot just push what we are producing to the customers anymore, we need to find which products that the customers really want and we can fetch the highest price. And when we have that across business or enterprise level view, we can push the molecules properly from source to the proper markets. I think because of COVID-19, a lot of people are staying at home and studying or home cooking and things like that. The price of LPG  is now much more than LNG. So based on that we’re trying to push our production and to basically ship the molecules from producing LNG which you know, right now is around two to $3 to LPG, which can fetch a higher price.

So that’s one of the examples of what you can call vertical integration, we can try to  make sure that we can find a better home for the molecules that we extract from the ground.

And, in your opinion, how can new technologies and innovation help with these changes in business models, and this vertical integration that you spoke of?

Right now, we collaborate, for example, on AI or machine learning to really go through our vast amount of data. I think everybody knows that we integrate a lot of data, not only from the plant operations side, but also our business side. And quite rarely, we merge those two data streams together. But now we are trying to combine those two so that wherever the decisions are being made, from the enterprise level, they can be cascaded down and tracked until the operation or asset level. 

So we really need the latest advancement in machine learning and AI to help us to process all that data and find new insights. And also to expedite the way we work. One thing I noticed is you can no longer take three to six months to produce a result, you need to do it in in weeks. So that’s where right now we are trying to leverage as much as possible on the latest technology, digital technology, even in Cloud computing, to make sure that we have the correct amount of firepower to run all the complex calculations. And I think in the future, everything will become online, predictive, and even, you know, prescriptive. We know is going to happen and what steps are needed to prevent it from happening again. So this is the expectation going forward, I think in the next three to five years. 

There’s a huge volume of data now being used in this era of AI, machine learning and agile working. Is cybersecurity and data governance a concern?

Yeah, that’s one of the highest priorities that we need to manage, I think back, to three to five years ago, when we tried to centralise all our data in headquarters, and the issues in security (we faced): when we tap into the plants how can we prevent, for example, viruses or hackers coming from the enterprise network, from going into the plant network? So that’s one thing, Also in terms of governance, and especially if we have facilities that are JV’s with other companies. Previously all the data belongs to that particular asset, and a lot of surprising legal representation needs to be taken for us to transfer the data from the site back to the centre.

So we definitely need to manage that and going forward as a company, we are pushing towards borderless data sharing, and centralised security. Basically, we’re going to Cloud and you’re leveraging on Cloud security to tackle the latest threats and be able to manage under Cloud providers.

How do you empower your workforce to keep up with the rapid pace of digitalization?

In our company, we’ve started a digitalization upskilling programme. Through online learning, and through talks and live streaming, the whole employee population is exposed to the latest digital development. So, I think as a start going forward towards digitalization, everybody needs to be able to converse in the same language. And then those who feel that they are really into becoming data scientists or programmers, they would specialise in different areas. I think it’s typical: when we have engineers, they have basically a general knowledge of operations. And then they start to specialise in certain areas. So I think you have to start with a common background and foundation and then we start to upskill. 

Speaking of digitalization, how do you think that digitalization and new technologies can help operators reach their sustainability goals?

I think by making the data more transparent. Now, what the operator sees is basically the raw data coming from your various sources in a plant. And a lot of this is relevant to sustainability for example, amount of Co2 equivalents being emitted, and the amount of energy utilisation.. And right now, we are leveraging one of the examples with our simulation models. We take the data and we take all these parameters, for example, how much you do, what are you emitting? How much is energy positive about the product that we are consuming? And we make that available for the operators to see.

So they know each action that has real impact on the emissions or basically the sustainability of the operations to a certain extent. And again, that’s making the data more transparent and also making the calculations more available at your fingertips. That’s the main driver.

A key driver of performance is building good relationships with the right business partners. What are the key qualities that you look for in a business or solutions provider?

Stop just selling the solution. (Solutions providers) should be focused more on addressing our pain points, and helping us to get more value by using your solutions. That’s what we are looking for as our partners, especially technology partners.

It certainly seems as if long term business planning for the future is really key for yourself and for PETRONAS during this current climate. What role do you think hydrogen is going to play in the future of both PETRONAS and in the future of the energy industry?

I think it’s good to be prepared.  We are looking towards hydrogen as a potential future energy source in addition to electricity and other type of renewables. But I think in our position, the infrastructure around it needs to be in place for hydrogen to become really sustainable as a potential source of energy. 

I think, we should develop like a small scale close network community if you want to call it that, and see if we can do a self-sustaining ecosystem, using hydrogen as fuel. And maybe we can convert or generate part of that hydrogen from our current processing plants that have excess hydrogen, and use that to reduce our electricity consumption. Again, with hydrogen, the issue is basically creating hydrogen. You need to create hydrogen from water and it takes a great deal of time to create hydrogen from water, we need a lot of activity for the heterosis process. 

Also, you want to transport hydrogen safely, you want to build a hydrogen refuelling station, and enable a full solution, or partial transition to hydrogen fuel. All that needs to be in place, which, unfortunately, has costs. And right now, I think the government also needs to play a part for them to subsidise, or basically have a strong aim for what we need to implement  hydrogen infrastructure in our country, maybe in five to 10 years. And if you have that mandate, or that goal, I think the private sector can also play a role. At least they know there’s a clear direction from the government, and they will be more inclined to invest in developing that kind of infrastructure, if not, is going to be a bit difficult because of the high cost.

Do you feel that amongst oil and gas operators, sustainability and the shift towards renewables is becoming more of an ESG and CSR concern?

Definitely. Especially in Europe, they’re really pushing towards renewables and people are getting more concerned about global warming and trying to reduce emissions, and like it or not, the whole world will shift towards that. Renewables are becoming more glamourous and the cost is going down. So, the traditional players need to reshape themselves to become a new energy provider, in whatever sense, in whatever any form, in order to survive in this new era. If not, we become like those companies that become dinosaurs. So we don’t want to become that, we need to be innovative, in how we transform.

And also, we need to rebrand. For example, plastics is not evil: we just need to produce simple plastic in a much better way, you know, less waste, less energy, easy to recycle, things like that. So I think you need to evolve, become greener, more concerned with the well-being of the planet, and still provide energy, in a cleaner, interesting and sustainable way.

As you say, oil and gas operators need to evolve in order to survive this next era of the energy transition. And in your opinion, what do you think will be the biggest challenge for operators trying to do that? And what is your top strategy for helping them overcome that challenge?

The oil and gas industries have been there for quite a long time, you know, close to 80 to 100 years. And I think the way we are moving is not as fast as the new digital start-ups or digital companies. I guess we’re very conservative, very cautious, because of the hazardous nature of our business, in trying to adopt new standards, for example, in renewables, in doing hydrogen. (But) we need to do it, we cannot take the same amount of time that we took previously. We need to accelerate that kind of maturity.  So, that’s quite a tough challenge. We need to think as an industry, what is really critical to make sure that we are still safe, we are still responsible, but we also need to make sure that we are able to stay with the wave of the digital movement. 

Finally what would be your one tip for young engineers trying to get into the industry?

You need to have passion. I think in Europe, they are already seeing that being in the oil and gas industry is not that enticing anymore. The risk is people will see this sector as a kind of dinosaur. But moving forward, we need to continue developing or basically transforming the sector to become more greener, more sustainable. So, we need the new people to start seeing this objective: that they need to transform this industry by learning the latest technology, for example, waste management and studying the circular economy. How they can better shape the industry to manage future challenges?

And at the same time, they also need to basically understand the core technology required to run an energy company, so that they’re able to know that what they can do and what they cannot do, and that hopefully will help push the industry towards a much better position to manage the future.