Kongsberg Digital CEO Shane McArdle acknowledges there are risks in adopting artificial intelligence (AI), but he is confident that recent advancements have set the stage for a significant transformation in the workplace.
Speaking last week in Houston at the industrial software developer's annual technology event, McArdle noted that we are standing at the start—or possibly "the end of the beginning”—of a new era in which "AI is absolutely going to shape and change the future of our lives, starting with work."
He said the last time the world was poised for such change came during the Industrial Revolution. And while that transformation took the better part of a century to spread across the globe, McArdle sees the pace of progress moving much faster today.
"Instead of changes happening in decades, we can expect that these changes are to happen just in years, and we're probably already feeling a little bit of the impact of this on our day-to-day lives," he said.
The biggest shift may not be far off and will come, he said, as simulators, machine learning, and traditional AI approaches are integrated with the emerging large language models (LLMs) to form multi-agent frameworks. McArdle said this convergence will create advanced AI programs capable of mimicking human decision-making across a broad range of scenarios.
However, the immediate AI opportunity for Kongsberg Digital lies in integrating LLMs into its recently updated industrial digital twin and operational software platforms that are used by supermajors such as Shell, Chevron, and TotalEnergies. The Norwegian firm's latest innovations are the result of its partnership with Microsoft, granting it access to OpenAI's GPT models, and also open-source LLMs, including Meta’s Llama.
McArdle spoke about some of the potential downsides of AI, particularly the security risks that it poses with more industrial assets becoming connected. Another challenge, which he called “AI solutionism,” is the tendency for some to view AI as a cure-all for every problem.
This mindset, McArdle said, “annoys” him because “it’s not true, and in many cases, we’re forcing this very advanced solution on the problems that just don’t need it.” He argued that many issues come down to user interface preferences and said the industry needs to be "surgical" in how and where it applies AI.
So, how prepared is the workforce for all the coming changes? That question was posed to Patrick Ryan, general manager of digital solutions and analytics at Chevron.
"There's a range of digital fluency at Chevron, from your digital natives—your Gen Z folks who have grown up with technology—to some of our field operators who aren’t necessarily digital natives. And I like to tell a joke about field operators: there are two things that are true about them—they don't like the way things are and they don't want anything to change," Ryan said.
But, like it or not, the shift is happening. Whether they are working at its oil and gas fields in the Permian Basin or in its skyscrapers in downtown Houston, Chevron employees are all on the same path to becoming “more digitally fluent, digitally enabled,” he said.
Ryan said the key to winning over this diverse workforce lies in first explaining the "why" behind the change, followed by taking decisive action to implement it.
“In Chevron, we’ve kind of gone away from the model where you had to go around and convince 20 different business unit leaders that they were going to come along with this technology, to a central platform structure where they no longer have a choice,” he explained.
Ryan added that the approach has helped Chevron standardize its software technology portfolio and “propel the train down the tracks to digitalization.”
But as more people recognize AI’s capabilities, fears about its potential to lead to job losses are mounting. Hema Prapoo, worldwide oil and gas leader for Microsoft, pushed back against this concern, emphasizing at the corporate gathering that AI, in its current state, is being used to enhance, not replace, human output.
Prapoo recalled a recent conversation with an executive that asked how many employees they could lay off after purchasing access to Microsoft’s Copilot program that is built off OpenAI’s ChatGPT LLMs.
“I said, we’re not in the business of telling you how much workforce reduction [will result]; it’s about how you optimize your workforce today so they stop doing mundane tasks and focus on what’s really important,” she explained.
Several executives stressed that while LLMs are new, the use of AI in the oil and gas industry is not.
Judson Jacobs, executive director of energy technology for S&P Global, noted that the adoption of advanced software began about a decade ago, with early adopters seeing improvements in energy efficiency and reduced emissions. However, he pointed out that the broader potential of AI is still untapped.
“The challenge I think for the industry is to realize that potential on an industrywide scale,” Jacobs said. “A lot of the things that we see are still one-off deployments.”
To accelerate progress, Jacobs suggested that putting more AI tools directly into the hands of engineers could speed up adoption, citing digital twins—already used by tens of thousands of oil and gas workers—as a prime example.
If upstream companies can get more out of AI, the potential rewards are enormous.
Richard Spears, vice president of market research firm Spears & Associates, highlighted that the global oilfield services sector—which accounts for drilling, completions, and production—commands $325 billion in annual spending.
He said that if AI could be used to identify and eliminate even a 10% inefficiency in that spending, it could result in savings of over $32 billion each year.
The key, Spears explained, is for AI to create transparency that allows companies to deploy capital far more intelligently than they do today. “To have a perfect view of what happened yesterday has to me a value of X. To have a sort-of-good view of what’s going to happen tomorrow has a value to me of 3X,” he said.
