State of the Industry 2019
by Pumps & Systems staff
January 1, 2019

The Pumps & Systems staff reached out to industry experts Doug Keith, Large Drives Business Unit Lead, Siemens Process Industries & Drives Division, U.S.; Paul Limpitlaw, Director of Process Instrumentation in O&G, and Doug Duncan, Director of Digitalization in Process Automation, from Siemens to talk about the state of the industry entering 2019. Here are the company's responses.

For more state of the industry coverage, click here.

Do you expect the oil and gas market to continue to grow in 2019?

In 2019, we believe that the oil and gas market will grow modestly. We are seeing that activity is picking up in the upstream market and expect to see an increase in development and exploration spend and rig deployment. As for the midstream market, we are highly optimistic regarding investment in infrastructure; the focus shifting from natural gas to Oil and NGLs due to the outlook in commodity pricing. Finally, we predict that there will be an increase in capex spending for the downstream market. Our customers’ priorities continue to focus on increasing operational efficiency, reliability and matching future capacity to future demand.
--Doug Keith

The oil and gas market is expected to continue growing in 2019, based on our market models and industry expertise. We should anticipate 3% of growth in the equivalent market and 7% growth in the actual & forecast.
--Paul Limpitlaw

What are the biggest roadblocks to IIoT adoption?

Some manufacturers may resist change because of the unknown; sometimes it is easier to think “if it isn’t broken, why fix it.” Those manufacturers may be afraid of new technologies that could cause more downtime or problems in the value chain. Additionally, new unprotected connected devices could open up vulnerabilities within a plant’s network.

Today, manufacturers have the opportunity to aggregate and analyze data from their machines, but it is hard for the manufacturer to understand what the massive amount of data means for them and how it can help them with their business.

Lastly, it is difficult and costly for manufacturers to replace and connect all of their equipment at once. Instead, companies are gradually updating equipment when the time is right, when budgets allow, or when something must be replaced. By doing so in pieces, it can be difficult to see the full benefit of a connected plant.
--Keith

The biggest roadblock to IIoT adoption that I see on regular basis is the trust of cyber security measures and fear of creating a weakness that might be exploited by bad actors. The consumer market is much further ahead in the adoption of IoT devices and convince it offer us in our daily life. Personally I have many home devices connected to my personal network and do so with little worry. After all, the data we transfer is of little value. For industrial customer however the risk could be much higher. The worry that data security could be compromised or that hackers might exploit an IIoT connection for nefarious purposes is a strong demotivation.
--Doug Duncan, Director of Digitalization in Process Automation

What are the biggest benefits to organizations that are embracing IIoT technologies?

In order for an organization to remain competitive, it must embrace digitalization and IIoT technologies. Manufacturers that digitalize their plants are more efficient, have reduced downtime, and have increased flexibility. Plant operators have the ability to monitor equipment in remote location, even unmanned stations, in a cost effective way. They can now use predictive maintenance rather than solely relying on preventative maintenance.
--Keith

The biggest benefits are numerous and picking the best is difficult. The top few would include:

  • Compression of the product development cycle by using design and engineering tools connected across an entire enterprise via a common data hub
  • Being able to test new processes, train operators, and trouble shoot process bottlenecks by utilizing digital twins of the physical processes
  • Having process knowledge at the right time from anywhere in the world
  • Being able to maintain a digital thread from the first step in a process through to the final quality control checks
  • Having the ability to utilize cloud based AI tools, eliminating the need to invest in dedicated and expensive, single owner, IT resources

--Duncan

When it comes to automation, how do you expect it to affect the process industries workforce in the next 5 years?

The fact that many people in the current manufacturing workforce will be retiring in the next 5-10 years is not new. It remains a critical management topic that manufacturers attract early career talent into the manufacturing workforce. The next generation of workers are digital natives and expect to work with the most modern tools and platforms. In order to attract and retain talent, chemical companies will need to apply the most modern automation technology, engineering tools and data analytics.

As for current workers that will remain in the workforce, companies must be more inclusive and facilitate training for these employees. As companies continue their digital transformation, it is important for those companies to provide continuous industrial reskilling to keep employees successful in the digital age.

Training and educating workers is foundational and second nature to Siemens. We see it as a business and as a societal need. For example, over the last 10 years through the Siemens Foundation, Siemens has invested more than $115 million in STEM education and workforce development initiatives.
--Keith

Employees in the process industries are going to become much more connected via digital tools and services. Workers can expect changes that will allow them to visualize processes while moving around the plant using tools such as hardened tablets wirelessly connected to process data. We can also expect enhanced safety due to the use of robots performing the more dangerous jobs such as confined entry inspections. Newer technologies like Real Time Location Services will also enhance safety by making it possible to know exactly where an employee is located in a plant if an emergency should occur. Ultimately, process industry employees should embrace digitalization and help their organizations shape how its utilized to make us all more productive and safe. The change is inevitable, but how it is implemented can and should be influenced by those who are affected by it.
--Duncan

With chemical processing as the industry that uses the most energy, what are professionals from designers to end users doing to control those costs?

Chemical processors should review the total cost of ownership of their equipment. According to the US Energy Information Administration, motors consume up to two-thirds of a facility’s energy usage. For an industry that uses the most energy, it is important for chemical manufacturers to take into account the entire electromechanical system and avoid selecting components individually, especially selecting a component based on initial-capital-cost only. The decision regarding the drive train purchase should start with designing the drive, motor, and driven-equipment as an integrated system that meets processing needs now and in the future.

Designing the system this way, in the beginning, allows manufacturers to optimize efficiency that results in increased productivity, improved mean time between failures, reduced waste, and often bottom line savings of millions of dollars in energy costs over the life of the system.
--Keith