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Analytics Magazine

Oil & AG Analytics: Mother Nature meets the Internet of Things

November/December 2015

 

Agriculture

By Atanu Basu (pictured) and Gabe Santos

Atanu BasuWhat does the oil and gas industry have in common with agriculture? More than you think. Both industries are influenced by Mother Nature in complex ways that we understand better every day. Advancements in computational technologies are making it possible to interpret information about nature’s impact on these industries in ways not possible just a few years ago.

It used to be all about understanding your numbers and then making a decision based on that structured data. But now industries, including complex ones like oil and gas, are using sensors to tap into information such as sounds, images, videos and text. That unstructured information can be mined just like numbers to unearth valuable insights that would not have been known otherwise.

In oil and gas, Mother Nature has packed several surprises and challenges hidden underground. She put oil inside rocks deep beneath the land, and though the industry has known this for a long time, it didn’t know how to extract the oil economically. Horizontal drilling and hydraulic fracturing are revolutionizing the industry and helped catapult the United States into the world’s No. 1 producer of oil and gas [1]. But even with these technologies, a lot of oil is being missed. That is where advanced sensors capturing data, i.e., the Internet of Things, is augmenting production capabilities.

For example, fiber optic sensors laid along a horizontal well for miles underground record and report – every foot and every second – the sound, pressure, temperature and more of hydraulic fracturing and energy production. Well operators, equipped with this information, get a new understanding of how a well is performing over time. In other words, the sensors help explain what is happening to Mother Nature during the energy extraction process.

Horizontal drilling and hydraulic fracturing are revolutionizing the oil industry.
Horizontal drilling and hydraulic fracturing are revolutionizing the oil industry.

With these disparate sources of information flooding in to operators, they need a way to connect the dots and take the best actions possible for each well. That next step is the province of prescriptive analytics, a technology that is domain agnostic by design. Prescriptive analytics software takes all of that structured and unstructured data and predicts what’s ahead and prescribes what can be done to achieve the best possible outcome. Working like a central nervous system, prescriptive analytics takes all of that data through numerous mathematical and computational algorithms and creates a recipe that tells operators how to change their settings for such things as water pressure and chemicals to get more oil before moving on to the next well.

The Agriculture Angle

What does all of this have to do with agriculture? The same principles used to maximize profits in the oil and gas industry can be a boon for farming. Like in oil and gas, sensing equipment is greatly empowering farmers by providing real-time analysis of crop condition, crop stress, growth stages, disease pressure, insect pressure and problem areas within fields.

Precision agriculture started with the development and commercial availability of GPS and satellite imagery and allowed for more accurate production areas, soil mapping and soil sampling. As a result, producers, agronomists and other experts could pinpoint the exact location and scope of problems in their fields. But field and yield information is only valuable to farmers if it informs a management decision or agronomic practice.

With the application of prescriptive analytics, farmers are not entirely dependent on nature’s whims. They now have a better way to use the information they’ve derived from a broad spectrum of structured (i.e., soil pH levels) and unstructured data sources (i.e., aerial satellite imagery).

Variable rate application has enabled farmers to target nutrients where they are most needed, rather than blindly broadcasting crop nutrients across the entire farm. Moreover, agronomists are now able to make specific prescriptions for growers based on their goals, and these prescriptions can be made to maximize yields, build and maintain nutrients over time, and reduce costs.

Agriculture represents the next frontier for prescriptive analytics. Precision agriculture is giving way to decision agriculture. It’s a prescription for happy farmers.


Atanu Basu is CEO & president of Ayata, an Austin, Texas-based company that develops prescriptive analytics software solutions. He is a member of INFORMS. Gabe Santos is managing partner of Homestead Capital, a private investment partnership formed exclusively to invest in operating farmland. A version of this article appeared in Global AgInvesting News. Reprinted with permission.

 

REFERENCES

  1. http://www.eia.gov/todayinenergy/detail.cfm?id=20692

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