The elephant in the room: Starting difficult conversations in the energy industry
The global landscape of the energy industry is transforming before our eyes. A tense political climate continually threatens to disrupt confidence and prices, from the Middle East to China. But with Canadian interests in mind, perhaps the situation closer to home demands keener inspection, with both U.S. and interprovincial relations acting as potential kingmakers when it comes to the future success of Canadian companies.
The Global Petroleum Show is committed to initiating these difficult, but necessary, conversations – something that Peter Tertzakian, Executive Director of ARC Energy Research Institute, believes is essential if Canada is to achieve its energy potential. We recently spoke to Peter regarding the “elephants in the room” when it comes to the Canadian energy industry and how best to approach these often under-communicated issues.
With the United States increasing their profile for oil & gas production over the last decade, they have effectively transitioned from Canada’s most important customer, to their leading competitor. With this in mind, it is arguably more important than ever for Canada to identify their unique strengths and work collaboratively to best position themselves in the global marketplace. However, as Peter states: “by virtue of our Constitution, our provinces often act like separate countries.” The unsteady dynamic between Alberta and British Columbia acting as the quintessential example, it is becoming increasingly possible to observe the Canadian market as a direct microcosm of the geopolitics evident in the global energy industry.
Peter Tertzakian cites a “lack of human communication between silos of opinion ” as a major cause for interprovincial turbulence, with the Trans Mountain pipeline at the heart of this debate. However, the pipeline itself is by no means an instant solution to these underlying interprovincial tensions, or more widely, Canada’s energy problems; indeed, if built, it may only provide a temporary solution until the next problem arises. Significantly, Peter closes our conversation with a plea for future discussions: “Let’s just pull in people to discuss the real, root issues of all this stuff and go beyond the narrow perspective of the pipeline.”
The Global Petroleum Show aims to do exactly this. To see just where these conversations might take us, be sure to register for the conference, which runs June 12-14. Of particular interest will be the North American Outlook panel, which promises to interact with these interprovincial questions, alongside other “elephants in the room”, such as indigenous issues and how the energy industry can be part of the carbon reduction solution.
Conference tickets can be purchased here and registration for the exhibition is complementary until June 1st.
Blockchain: Redefining business transactions for oil & gas
There’s a new technological kid on the block, literally. But what does it mean for the energy industry? Keep reading for a preview of some of the invaluable information that will be discussed at this year’s Global Petroleum Show.
Blockchain is a digital decentralized ledger which is the foundation for digital coins such as Bitcoin. In cryptocurrency terms, new transactions are recorded in ‘blocks’, which when confirmed, are added to an existing ‘chain’ of previous payments. Effectively, blockchain technology can be used as an alternative form of banking, as it provides a means to freely distribute the data of your digital transactions online. Moving this process away from currency for a moment, the technology can similarly be used to collate large amounts of information and data in the form of databases, or in this case, digital contracts.
The energy industry is recognizing the disruptive potential that blockchain holds. With the help of James Graham, CEO of leading software company GuildOne Inc., here are the top three reasons why you’ll want to learn more about blockchain for the oil & gas industry:
- Blockchain can dramatically reduce the potential size and length of oil and gas disputes. This is done by creating a digital ‘smart contract’ that is reciprocally agreed upon by all parties, then positioning this checklist of agreed facts (whether measurements, geographical borders, royalty costs etc.) before the transaction itself. As Graham states, “You can think about it as all the counter-parties throwing their conditions into the middle and the smart contract executes everybody’s checklist before the transactions happen.”
- Blockchain can help to eliminate errors through creating consensus. Graham suggests one of the key benefits of blockchain for the energy industry is that it allows companies to transact trust, or value, with strangers, in a totally managed and consensual way. The digital contract that is initially agreed to becomes a collaborative document that allows for proposed alterations through a peer-to-peer structure, yet requires all parties to be in agreement before a change can be enacted. Similar processes are used regularly in the financial sector to ensure that all groups remain on the same page throughout the contractual process.
- Blockchain could oversee a reduction in both the time and money that is currently demanded by existing energy processes. This is achieved by creating a shared data and computing infrastructure that can benefit both consumers of energy, by enabling them to trade directly with energy producers, as well as large energy corporations themselves, by sharing workloads and costs. Graham points toward a visible “net gain” that would emerge over time, “because you’re moving people in the same data infrastructure and those infrastructural costs are borne by multiple parties”.
It’s clear that blockchain is primed to redefine the way we think about the oil & gas industry and how business is transacted – and we’ve only just scraped the surface of its potential. To learn more about blockchain and other digital solutions shaping the future of the industry, be sure to register for Global Petroleum Show before June 1, 2018 to take advantage of the early-bird conference rate and free exhibition pass.