Thread Content
Technological innovation has enabled China to transform from a country lacking oil resources into a major global oil power. There is written record of China’s extraction and utilization of oil and gas dating back over 2,000 years. However, due to the extremely slow development of petroleum technology, China’s exploitation and utilization of oil have been limited to the already discovered crude oil; research on the sources of oil and the geological conditions under which it forms has not been conducted. China’s modern petroleum industry began to take shape in the mid-19th century, and even up until the eve of the founding of the People’s Republic of China, its foundations remained very weak. Records show that between 1904 and 1948, the country produced a total of 2.9 million tons of crude oil, while importing 28 million tons of foreign oil. By 1949, the annual crude oil production was only 120,000 tons, natural gas production was 7 million cubic meters, and the proven oil reserves were 29 million tons. This is closely related to the backward geological research and drilling and production technology equipment in China at that time. After the founding of the People’s Republic of China, China’s petroleum industry began development from a situation of extreme poverty and lack of resources. On one hand, it relied on the spirit of independence, self-reliance, and hard work embodied by the Daqing Spirit and the Iron Man Spirit ； On the other hand, great efforts have been made to strengthen theoretical research in petroleum geology, technological development, and equipment manufacturing. This has led to the creation of an innovative path for oil and gas exploration and development with Chinese characteristics. As a result, China has not only shed its image as a country lacking in oil resources and technologically backward; it has also emerged as one of the world’s major oil powers. Remarkable achievements have been realized, giving rise to a well-developed industrial system encompassing technologies such as exploration, development, gathering and transportation, storage, and processing, along with relatively complete infrastructure. In 2018, China’s crude oil production was 189 million tons, its natural gas production was 161 billion cubic meters, and its crude oil processing volume was 604 million tons. These figures placed China in 4th, 6th, and 2nd place in the world respectively. The share of oil and natural gas in the structure of primary energy consumption rose to 27%. Looking back on the past and reflecting on the present, through a series of major discoveries, breakthroughs, and thrilling moments in battlefields of significance that have occurred in China’s oil industry over the past 70 years, we can see that the power of technological innovation continues to grow. The long-term high and stable production in the Daqing Oil Field, the \"two new and two high\" goals in the Tarim Oil Field, the pursuit of high yields through the use of \"grinding stones\" in the Changqing Oil Field, the shale gas resources in Sichuan and Chongqing, the major discoveries at Mahu in the Xinjiang Oil Field, and the shale oil resources in Jimusaer… The technological innovation in China’s oil and gas industry continues to achieve both incremental breakthroughs and systematic advancements. Over the years, China’s petroleum industry has developed geological theories such as those related to continuous oil and gas accumulations ； It has developed and improved world-leading technology suites for the efficient exploitation of low-permeability and heavy oil, as well as tertiary oil recovery ； Breakthroughs have been made in the localization of core technical equipment, such as large-scale complete fracturing units and near-bit geosteering systems ； The complete set of technologies for exploration and development at depths of 300 meters has been mastered; the capability for independent exploration and development at depths of 1,500 meters, along with the engineering technology equipment and operational capabilities required for depths of 3,000 meters, have also been established. The deep-water semi-submersible drilling platform \"Ocean Oil 981\" has been built and put into operation ； It has overcome the world’s challenges in drilling at extreme depths, ultra-high pressures, and ultra-high temperatures, ranking among the leaders in the field of deep well drilling technology ； Many other technical devices have broken international monopolies and reached or approached the world’s advanced level. Since the establishment of a science and technology award system in the 1960s, PetroChina alone has received 616 such awards. In particular, the “discovery and development of the Daqing Oil Field” is considered, alongside the “Two Bombs, One Satellite” program, one of the major scientific and technological achievements of New China in the 20th century. Currently, the world is undergoing profound changes unseen in a century. A new round of technological, energy, and industrial revolutions is beginning to take shape. China’s oil and gas industry is at a critical stage of transformation and change. In line with the new energy security strategy of \"four revolutions and one cooperation\" proposed by ****, China’s oil and gas industry must, from the perspective of ensuring energy security and promoting high-quality development in the energy sector, proactively adapt to the general trends of shifting from oil to gas, from conventional to unconventional resources, from onshore to offshore operations, and from shallow waters to deep waters. It is even more necessary to rely on technological innovation to drive digital and intelligent transformation, overcome challenges in exploration, address environmental constraints, reduce development costs, and establish new competitive advantages based on technology. At this new historical starting point, as we look ahead to the future development of the oil and gas industry, technological innovation has a long way to go. To achieve sustainable development in the oil and gas industry, it is necessary to rely on technological innovation. Typically, people’s understanding of technological innovation comes from their use of innovative products, while oil and gas are natural resources buried underground, which seem to have nothing to do with innovation. In fact, technological innovation is divided into product innovation and process innovation. The exploration, discovery, development, and production of oil and gas is a highly complex process that relies on technological innovation; however, such innovation does not create oil and gas itself, and its effects are difficult for consumers of oil and gas to perceive. Especially when there is an ample supply of oil and gas and consumers take it for granted, they fail to see the significance of such process innovations. Some even wrongly believe that the value of oil and gas is primarily reflected in the natural endowments of the resources, with little to do with the technological innovations of producers. Looking back over more than 100 years, the world’s oil industry has more than once found itself trapped in a cycle of \"decline,\" \"doom,\" \"end,\" and \"substitution,\" but it was always technological innovation that saved humanity from despair. Every major breakthrough in oil theory and technological innovation brings about a series of profound changes in production practices, and even alters the global energy landscape. For example, in the 1920s and 1930s, it was the advent of technologies such as reflection seismics, internal combustion engine-driven drilling rigs, and roller cone bits that raised the world’s annual oil production from 100 million tons to 200 million tons. In the 1960s and 1970s, it was thanks to theories and technologies such as plate tectonics, water flooding, and jet drilling that the world’s annual oil production rose from 1 billion tons to 2 billion tons. During the same period, breakthroughs in the understanding and application of China’s continental oil generation theory enabled the discovery of a number of large and medium-sized oil and gas fields such as Daqing, Shengli, North China, and Liaohe, which propelled China into the ranks of major oil-producing countries. In the 1980s and 1990s, with the widespread use of technologies such as basin simulation, 3D seismic exploration, horizontal drilling, and directional drilling, the world’s annual oil production reached 3 billion tons. Entering the new century, advanced technologies in the field of oil and gas exploration and development around the world have continued to emerge in large numbers. In particular, the \"shale oil and gas revolution\" in North America in recent years represents a new technological revolution. The emergence and application of new technologies such as horizontal drilling, multi-stage fracturing, and microseismic monitoring have led to a significant increase in shale oil and gas production, thereby altering the global energy landscape as well as political, economic, and diplomatic dynamics. In the near future, technologies such as drill-free drilling, underwater factories, nanobots, smart oil fields, and Internet+, will undoubtedly bring the oil industry into a new era. We must strive to build a world-class energy enterprise driven by technological innovation. Indeed, all world-class companies possess world-class technologies. Throughout the history of the global oil industry’s development, international oil companies and service companies have always been the main drivers of technological innovation. The reason these companies are able to remain successful over the long term and become \"century-old enterprises\" is closely tied to their consistent focus on using technological innovation as their core competitive advantage; they not only possess world-class technologies but also drive the development of future technologies. An increasing number of **oil companies are also investing more in technological innovation, considering \"technological independence\" as an important means to achieve \"energy independence,\" thereby gaining a unique advantage as latecomers. The technological innovations of international corporations always bring surprises to the world. Among these, efforts to increase the rate of discovery of undiscovered oil and gas resources have led to continuous new breakthroughs in new areas and sectors such as unconventional oil and gas, ultra-deep waters, and polar regions ； A large number of old oil fields have regained new vitality as efforts are made to improve the recovery rate of the resources already discovered ； To improve the conversion rate and efficiency of resource utilization, green, low-carbon, and new energy technologies are emerging and growing rapidly. Over the past decade or so, the investment in research and development by international oil companies, service companies, and certain oil firms has seen a significant increase overall. In terms of the intensity of R&D investment (i.e., R&D expenditure as a percentage of total operating revenue), international oil companies generally maintain this figure between 0.2% and 0.6%, while service companies average 3%. They generally hold a large number of technical patents and have maintained a technological monopoly in certain key areas for a long time. Especially during periods of low oil prices, the intensity of R&D investment by international corporations has not only not decreased significantly but has actually increased. Historically, the emergence of some major revolutionary technologies has coincided with periods of low oil prices and difficulties faced by the industry. Innovative enterprises are always able to rise from the ashes like a phoenix. It is necessary to always build a value chain for technological innovation around the business chain. In recent years, technological innovation in international oil companies has begun to exhibit new characteristics at this stage, with a rapid shift from a \"strategy-driven\" approach to a \"value-driven\" one. While advocating that technological innovation should be aligned with corporate strategy, they place even greater emphasis on value creation and value chain management ； Make full use of the latest advancements in technology to compensate for weaknesses in its own R&D capabilities ； Shorten the R&D cycle more effectively, while reducing R&D costs and risks ； Make better use of limited R&D funds to create greater value for the company ； Focus on technology portfolio management, emphasizing core technical capabilities and platforms ； It is essential to vigorously pursue open innovation; when making decisions regarding various methods of acquiring technology such as independent research, collaborative research, and technology alliances, factors such as technology transaction costs must be taken into full consideration. In practice, these companies emphasize formulating appropriate technology strategies, stressing the alignment of innovation activities with corporate strategy and competitive demands, and deploying R&D project portfolios in line with business development goals ； The company’s leadership is focusing more effort on innovation and creation, aiming to enhance value creation through innovation ； Provide sustained and stable financial support for technological innovation, and allocate funds to appropriate research areas, particularly those where there are advantages and competitiveness ； Create a cultural atmosphere that encourages innovation and tolerates failure, foster employees’ innovative spirit, and motivate them to identify problems and offer relevant opinions or suggestions ； Create a knowledge management system within the company to enable the sharing of information and knowledge across the organization; through knowledge sharing, stimulate the generation of new ideas and foster further innovation ； Place emphasis on recruiting and developing outstanding employees with technological innovation capabilities, and form multi-functional teams composed of individuals with diverse skills ； Establish organizational structures and management processes that effectively support innovation, mitigate risks, and ensure that technological innovation is promoted in an efficient manner. Some companies no longer emphasize being \"completely ahead\" in terms of technology; instead, they determine their technological strategic positioning based on actual needs, adopting a strategy of selective leadership more often. The company will focus its efforts on practical technologies that can increase production capacity, reduce costs and improve efficiency while generating value, as well as on individual or a limited number of technologies that possess its own advantages, and accelerate their industrial and commercial application. To establish a sound and open innovation system in the field of science and technology, oil and gas companies must place innovation at the core of their overall corporate development strategy, ensuring that innovation is integrated into all aspects of the company’s reform and development efforts. Among these, it is crucial to strengthen technological innovation; when planning the company’s business development, project investment, and engineering construction, factors related to technological innovation should be taken into account. Based on their existing systems for technological innovation, enterprises should, in light of the new circumstances and tasks, draw extensively on the successful practices and experiences of outstanding companies both at home and abroad. They should focus on improving these systems in terms of strategy, organization, resources, rules, and culture, thereby enhancing their capabilities in technological innovation, international competitiveness, and value creation. In line with the overall direction of deepening reforms in the oil and gas sector as well as state-owned enterprises, such enterprises must fully implement the various incentive policies issued by the central government to deepen reforms in the science and technology system and promote innovative development. They should be bold enough to break down existing institutional barriers and establish new mechanisms that are dynamic and full of vitality. For example, greater efforts and faster progress can be made in areas such as promoting the transformation and dissemination of scientific and technological achievements, establishing professional technical position systems, and piloting the project leader responsibility system. Today, no company can achieve strategic transformation and technological advancement solely on its own. An increasing number of oil companies are adopting an open approach to technological innovation, making full use of external innovation resources by bringing universities, research institutions, as well as customers, suppliers, and even competitors into the innovation process, thereby creating an open ecosystem for technological innovation. All sorts of technology alliances, innovation and entrepreneurship consortia, technology venture capital, joint industrial projects, and even cross-sectoral and inter-industry cooperation projects are emerging in large numbers. In the past five years, the number of collaborations and alliances among oil companies has more than doubled. The number of innovation industry alliances and venture capital firms has significantly increased in the fields of applied basic research and emerging, cutting-edge technologies, particularly in clean energy and digital technology. It is necessary to accelerate the digital and intelligent transformation of the oil and gas industry; digitalization and intelligence are becoming key areas for technological innovation in this sector. Digital transformation emphasizes knowledge sharing, requiring the establishment of open digital platforms and collaborative development environments to foster industrial innovation and prevent the emergence of new \"digital islands\". The data core of the oil and gas industry consists of exploration and development data, production and operation data, warehousing and logistics data, as well as additional data. Cloud computing technology provides the foundation for analyzing large volumes of data. At present, data security and standardization are the main challenges faced, as well as the primary obstacles to data interoperability. At present, there is a lack of sharing of technological resources, research outcomes, and data resources in the oil and gas industry, as well as a lack of coordination among various business systems. There is an urgent need to improve mechanisms for sharing technological innovation resources, and to promote the open sharing of research infrastructure, large-scale scientific instruments, research outcomes, data resources, and training resources within enterprises. This will enable interconnection between various management and production information systems, allowing data to be transferred and moved seamlessly between different systems. At the same time, it is necessary to improve the mechanism for authorized use of information resources and establish incentive mechanisms such as performance evaluation and subsidy rewards for sharing. For the massive amounts of various types of data, enterprises need to plan in advance and ensure seamless integration between these data and information systems. In the process of digital transformation, cross-sector collaboration is an essential approach. On the one hand, the oil and gas industry has reached a bottleneck in terms of innovation, and there is an urgent need for further cross-sectoral integration. The oil and gas industry’s demand for technology spans almost all technical fields such as mechanics, electronics, and chemistry, facing interdisciplinary technical challenges. On the other hand, the rapid development of high-tech has also provided new opportunities for the deep cross-sectoral integration of the oil industry. The rapid development of advanced technologies such as big data, cloud computing, 3D printing, virtual reality, artificial intelligence, quantum computing, DNA, quantum communication, the Internet of Things, and blockchain will undoubtedly have a revolutionary impact on digital transformation. Conclusion: Great companies are great primarily because of their culture. Truly innovative enterprises must foster a strong innovation culture and develop a healthy innovation ecosystem. If the early world oil industry emphasized \"capital-driven\" models, and later pursued \"resource-driven\" approaches, then looking to the future, a \"technology-driven\" approach is beginning to emerge. Whoever masters the technology owns the future.