The oil and gas industry hardly innovates! They just dig up oil! Who cares?
Actually, I care and I believe that you should, too. I’m so interested in this that I’ve been interviewing innovative professionals in the oil and gas industry. In my last post, I interviewed Wavefront Technology Solutions and RigNet. The more I spoke to these executives, the more impressed I became with the industry.
NeighborOil is changing the end of the energy cycle. As NeighborOil CEO Paul Harkins says, “We are the last mile in the oil business.” NeighborOil sells home heating oil in a very different way. Customers get points (or Neighbor Points as they are called) in several ways, including inviting other people to the NeighborOil web site. This gives NeighborOil a viral effect. “Our customers get Neighbor Points by interacting with the web site. For example, they get points for posting what’s going on in their local area or inviting neighbors in their area to join NeighborOil. Points then convert to a cash credit when a person buys oil no matter where they live,” Harkins explains.
NeighborOil is using social networking to help customers lower their own oil costs. In this way, customers are advertising NeighborOil and getting rewarded for it. NeighborOil is about empowerment. “Our company puts the power to control the price they pay for oil back in the hands of customers,” says Harkins.
One striking difference about the oil and gas industry from other industries is its ability to operate every single day of the year without fail. Everyday we are able to pump gas in our cars and heat our homes. Dale Emanuel, president of Solomon Associates, the global energy consulting firm, told me how increased environmental regulations caused the industry to change their operations without disrupting business:
“Over the last 10 years, the industry has moved from a high sulfur content in gasoline and diesel to literally almost no sulfur. The American public really never knew about it and didn’t realize that the refining business had to spend billions and billions of dollars to do it. It was shipped all over the country effortlessly.”
Sulfur is a known contributor to haze. Reducing it not only provides important public health and environmental benefits but also greatly reduces the maintenance requirements of oil heat equipment.
The oil and gas industry incorporated this change seamlessly without affecting consumers. Operations can’t come to a halt in the oil and gas industry or the American public would suffer. We are dependent upon oil. But even through this intense demand, the industry was able to reduce the amount of sulfur in gasoline and diesel. I asked Emanuel about innovation in the industry and he had this to say:
“Regarding innovation, the most important thing I can highlight is what the oil and gas industry does every day, 365 days a year. To deliver gasoline to so many consumers so safely and economically is really an incredible feat. I think the American public tends to take this for granted.”
We would certainly realize it if things weren’t so reliable, if getting gas in our cars wasn’t always a given. But we know we can drive to the gas station and get gas immediately. I’ve said before that I think the oil and gas industry gets a bad rap. I am hopeful that those with negative opinions can identify the positive aspects of the industry. The industry is striving to be more environmentally conscious everyday. Additionally, it is working hard to make sure the industry doesn’t die out, to comply with increased government regulations, and to keep operations reliable ever single day for consumers.
I’m impressed. Are you?