Oil and gas industry: new ways to capitalize before drilling
One of the largest challenges in the oil and gas sector is generating the financing for exploration and production campaigns. The time between a discovery being made, quantified and finally extracted can be significant, and if natural resources can only really be capitalized on once they are extracted and moving towards the downstream, managing supply efficiently become a challenge.
PermianChain is proposing a change to the way that things are done today. Using the blockchain, we want to make it possible for exploration and production firms to monetize or capitalize on reserves that have been confirmed but not yet to be produced. This will generate early revenues for suppliers and provide higher discounts to buyers.
This is going to be achieved by using the tokenized asset mechanism and data mining infrastructure, which establishes an open, secure, transparent and direct oil and gas investment and trading platform that harnesses by blockchain technology. It will increase the efficiency of oil and gas trading, making ownership more transparent and help the entire sector move faster.
Reducing complexity, attracting investment
Trading oil and gas is currently complex, slow and fundamentally inefficient. Agreements are cumbersome and difficult to transfer without adding costs and there are so many different steps involved in the process of getting oil and gas from the ground to the consumer, that the knock-on effect of delays at any point can be significant and costly.
Using a tamper-resistant blockchain with global information that is updated in real time, the PermianChain platform will be a massive step forwards for the industry. It comes at a time when there is significant investor and regulatory scrutiny as well as a rising challenge for alternative sources of energy. While oil and gas are likely to retain their central role in the global energy mix for the foreseeable future, the industry needs to adapt and show that it is embracing efficiency. If it doesn’t, there is a risk that it will become less attractive to investment. This could have an impact on production and increase the speed of alternative energy adoption.
The PermianChain approach will make it possible for a far broader range of investors to become involved in the oil and gas sector at a far earlier stage. The current investment model favours larger institutional investors because generally it is easier for organisations to manage a limited number of large investments rather than juggle potentially dozens of smaller investments.
By moving the investment process onto a blockchain, it becomes far easier and more efficient for firms to manage investment from multiple sources without adding to the administrative burden. Potential investors will be able to look at the opportunities listed on the PermianChain platform and make investments directly via a tokenized security; serving as a digital representation of their equity in oil & gas assets that are registered on the platform.
There are an estimated 1.6 trillion barrels of proven oil reserves globally. By creating a platform that will allow investors of all sizes the opportunity to own a share of the world’s natural resource reserves, PermianChain is creating an exciting new market, helping ensure that the sector retains its relevance and taking a large step towards solving one of the sector’s most significant challenges.
PermianChain Technologies is investigating ways to harness the power of blockchain technology, data science and artificial intelligence to monetise potential but unproduced oil and gas reserves. The PermianChain, which already has secured 250 million barrels of oil equivalent in potential reserves to be listed on its platform, intends to revolutionise the way that potential reserves are bought and sold on a permissioned-access trust-protocol. The firm is in the process of applying to become a regulated trading and investment platform.
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