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Baker Hughes strategy - energy transition, digital, neurodiversity

Friday, July 23, 2021

Baker Hughes executives outlined aspects of the company's strategy, including energy transition, cutting its own emissions, digital technology, and staff neurodiversity.

For the energy transition, Baker Hughes' business strategy is based around three 'pillars'. These are improving efficiency of the existing business, developing products for gas, and new frontiers like hydrogen and CCUS, explained Michele Fiorentino, Executive Vice President of Strategy & Business Development at Baker Hughes.

For improving efficiency of the existing business, it is expanding use of remote operations, he said.

For gas, it wants to develop products to build the gas 'value chain', including compression and other gas handling technologies.

Services for new frontiers can include technologies like hydrogen, CCUS, energy storage and geothermal, he said.

Baker Hughes also offers consultancy services which cover the transition, through a company 'io oil and gas consulting', a joint venture with Baker Hughes and McDermott.

One service it offers is pre-FEED (early stage planning) for oil and gas energy transition projects. It has a customer in Trinidad and Tobago considering a green hydrogen project, said Uwem Ukpong, Executive Vice President, Regions, Alliances & Enterprise Sales for Baker Hughes.

Carbon capture is already opening up new markets for Baker Hughes beyond oil and gas, Mr Ukpong said. 'Last week I was speaking to a fertiliser company [discussing] how we can help them decarbonise. We are seeing some small start-up companies ready to set up a blue ammonia plant with carbon capture.'

Mr Fiorentino said it is very hard to predict how hydrogen will be rolled out, because it depends on the market situation.

'It is often the case that people fall in love with specific solutions. But it will be very difficult for any low emission technology to take off until there is a higher cost of pollution.'

'As far as hydrogen specifically, even with that incentive, you are probably talking about 10 years before it becomes really mass market.'

Baker Hughes own emissions

Baker Hughes has been working to quantify emissions for products and services, a long and complex task, said Allyson Book, vice president of energy transition for Baker Hughes.

'When you understand the full lifecycle, it gives you more insights.'

'As a manufacturer, scope 3 [supply chain emissions] becomes very material,' she said. 'We work with suppliers, customers and employees.'

Digital strategy

In the realm of digital technology, Mr Ukpong believes that Baker Hughes has a unique advantage in its ability to combine digital capability with oil and gas and engineering domain expertise.

And this domain expertise gives the company a differentiation from the purely digital technology companies who are aiming to build their oil and gas market.

Although it can be useful for Baker Hughes to work together with companies like Microsoft. 'Microsoft is very well connected to a lot of major customers,' he said.

Working with Microsoft can help, for example, when oil and gas engineers want to install a new AI application, and the oil company CIO is reluctant to allow it to run on the corporate servers.

'Going together with Microsoft allows us to explain to the business what we're trying to do, and say it won't disrupt the CIO's ecosystem.'

Often you need domain expertise to work out if the output from an AI system makes sense, or if a domain expert would make a similar recommendation to the one the computer is making, he said. And domain expertise is also required when building the digital tool.

The main advantage digital technology can offer domain experts is the ability to scale up what they can do, said Mr Ukpong, himself a reservoir engineer.

'I've got to look at data and see if that validates with well-established physics models.'

'We've got a customer who is trying to predict when ESPs are going to fail based on physics based models. I can only look at 20 ESPs at one time. When we brought in AI and looked at past behaviours - and built a statistical model, we can look at 800 ESPs a day. That's the beauty of AI where you're bringing in a much higher level of efficiency.'

If people in the industry believe computers can replace the experts, it may lose its experts, Mr Fiorentino added. 'You don't create those experts at the flip of a finger, it takes training, dedication, time. Once they are gone they are gone. You can't go on the street and say, 'I need a turbomachinery expert'".

Staff diversity

Baker Hughes is also looking to hire more neurodivergent people. This is a term Oxford Dictionary says is 'frequently used with reference to autistic spectrum disorders.'

'Neuro-diversity I think provides a cool competitive advantage, when you can embrace that and have a really inclusive workforce,' Ms Book said.

'We're going to try to build an internship program, so people can get a feel for jobs where we may not have placed neurodivergent people before.'

The company has identified 'individuals that are on the spectrum who are uniquely positioned to work in our digital technology teams,' says Deanna Jones, chief human resources officer with Baker Hughes.

'The way they think about these complex problems, a system approach to the work that we're doing, I think it is a fantastic partnership.'

'Not only identify the neutral diverse talent, but prepare the leaders to work with the different talent.'

Ms Jones adds that 75 per cent of the company's employees live and work outside the US, and 35 per cent of the US employees come from 'diverse, under represented minority groups.'



Associated Companies
» Baker Hughes (BHGE)
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