IBM and the Abu Dhabi National Oil Company (ADNOC) have successfully piloted a blockchain supply chain system to integrate oil and gas production across the full value chain. The system provides a secure platform for the tracking, validating and execution of transactions at every stage, from production well to the end customer.
The technology will reduce the time it takes to execute transactions between ADNOC's operating companies and increase operation efficiencies across its full value chain. The software will also improve the reliability of production data by enabling greater transparency in transactions.
"We believe this could be the first application of blockchain in oil and gas production accounting anywhere in the world. It demonstrates how ADNOC is leveraging innovative partnerships to unleash the power of technology and creative thinking to enhance efficiencies and deliver greater performance," Abdul Nasser Al Mughairbi, ADNOC digital unit manager said. "Blockchain is a game changer. It will substantially reduce our operating costs by eliminating time-consuming and labor-intensive processes, strengthen the marketing and trading of our products and create long-term sustainable value that will ensure that ADNOC delivers on its 2030 smart growth strategy."
The pilot provided a single platform that tracks the quantities and financial values of each bilateral transaction between the ADNOC's operating companies, automating the accounting process.
As the blockchain is expanded, it will be linked to customers and investors, providing seamless integration among stakeholders. By enhancing transparency, the ledger will reduce inherent business risks and consequently enhance the attractiveness of ADNOC Group as an investment partner.