by the numbers

Houston rises as emerging hub for $6B global AI in oil and gas industry, per new report

The research outfit says North America leads global AI growth in oil and gas, with Houston playing a pivotal role. Image via Shutterstock

Houston is emerging as a hub for the development of artificial intelligence in the oil and gas industry — a global market projected to be worth nearly $6 billion by 2028.

This fresh insight comes from a report recently published by ResearchAndMarkets.com. The research outfit says North America leads global AI growth in oil and gas, with Houston playing a pivotal role.

“With AI-driven innovation at its core, the oil and gas industry is set to undergo a profound transformation, impacting everything from reservoir optimization to asset management and energy consumption strategies — setting a new standard for the future of the sector,” says ResearchAndMarkets.com.

The research company predicts the value of the AI sector in oil and gas will rise from an estimated $3.2 billion in 2023 and $3.62 billion in 2024 to $5.8 billion by 2028. The report divides AI into three categories: software, hardware, and hybrids.

As cited in the report, trends that are sparking the explosion of AI in oil and gas include:

  • Stepped-up use of data
  • Higher demand for energy efficiency and sustainability
  • Automation of repetitive tasks
  • Optimization of exploration and drilling
  • Enhancement of safety

“The oil and gas industry’s ongoing digitization is a significant driver behind … AI in the oil and gas market. Rapid adoption of AI technology among oilfield operators and service providers serves as a catalyst, fostering market growth,” says ResearchAndMarkets.com.

The report mentions the Open AI Energy Initiative as one of the drivers of increased adoption of AI in oil and gas. Baker Hughes, C3 AI, Microsoft, and Shell introduced the initiative in February 2021. The initiative enables energy operators, service providers, and vendors to create sharable AI technology for the oil and gas industry.

Baker Hughes and C3 AI jointly market AI offerings for the oil and gas industry.

Aside from Baker Hughes, Microsoft, and Shell, other companies with a significant Houston presence that are cited in the AI report include:

  • Accenture
  • BP
  • Emerson Electric
  • Google
  • Halliburton
  • Honeywell
  • Saudi Aramco
  • Schlumberger
  • TechnipFMC
  • Weatherford International
  • Wood

Major AI-related trends that the report envisions in the oil and gas sector include the:

  • Digital twins for asset modeling
  • Autonomous robotics
  • Advanced analytics for reservoir management
  • Cognitive computing for decision-making
  • Remote monitoring and control systems

“The digitization trend within the oil and gas sector significantly propels the AI in oil and gas market,” says the report.

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This article originally ran on InnovationMap.

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A View From HETI

The officials say Harris County “has little to no authority” over the construction of data centers. Photo via HARC

Three Harris County officials are pushing for greater local control over the development and operation of data centers.

County Attorney Abby Kamin, County Commissioner Lesley Briones and County Commissioner Adrian Garcia recently called for action to give Harris County more power to regulate data centers.

As it stands now, Harris County “has little to no authority” over the construction of data centers, Briones said at a news conference. Harris County has 55 operating, under-construction, or planned data centers, according to a document filed with the county.

Briones outlined four steps being included in the Harris County commissioners’ exploration of potentially tighter local regulation of data centers:

  • Reviewing what Harris County can and cannot do regarding data centers
  • Creating a Harris County plan for the upcoming state legislative session aimed at granting more local control over data center construction and operations. State lawmakers would need to approve any changes in local control.
  • Establishing community “listening” sessions in Harris County about data centers
  • Notifying Harris County commissioners when a proposed data center seeks permits

Kamin noted Houston and Harris County lack zoning regulations, and the county’s 34 cities set their own zoning rules. Furthermore, she said, Texas Attorney General Ken Paxton has not issued a ruling on whether counties can impose a moratorium on development of data centers.

However, she said, “limited jurisdiction does not mean limited responsibility … New technology is arriving in our communities faster than our laws and institutions can keep up with, whether that’s data centers, AI or even drones.”

The effort by Kamin, Briones, and Garcia follows Gov. Greg Abbott’s recent statewide halt of new environmental and construction permits for data centers. State permitting is frozen until the Electric Reliability Council of Texas (ERCOT) and the Public Utility Commission of Texas complete their review of data centers.

Their initiative also comes amid growing public concern over the amount of electricity and water gobbled up by data centers, as well as residents’ own rising electric and water bills.

Houston-based CenterPoint Energy expects to connect 8 gigawatts of new data-center loads in the Houston area by 2029, with about 4 gigawatts to follow, Kamin said. That, she said, would significantly increase peak power demand.

“No industry should get to monopolize or run roughshod over residents, public safety, and our critical natural resources,” Kamin said.

That being said, Kamin and Briones stressed they take pride in Houston being the Energy Capital of the World and Texas being an economic powerhouse.

“This isn’t about being against technology or new technology, but growth has to go hand in hand with accountability,” Kamin said.

Garcia said he’s open to welcoming data centers as good corporate neighbors, but not without protecting the people who live near these projects.

“I’ll keep an open mind,” he said, “but I want to know what will ultimately be the benefit to the community. And right now, I need tools [to do that].”

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