BP to Study Effect of 3D Printing on Supply Chains and Oil Industry

Among the many benefits 3D printing offers, we’ve seen multiple ways in which it impacts the environment, mostly on a positive level. It opens up new avenues for recycling, allows for the development of more efficient and advanced alternative energy sources such as solar panels and wind turbines, and, perhaps most significantly, reduces the need for shipment of goods over long distances by allowing companies and customers to print needed items onsite rather than ordering them from elsewhere.

It’s that last part – reduced need for long-distance shipment – that has some oil companies concerned. BP has announced that they will be conducting a study on the effect of 3D printing on the global supply chains that the oil industry relies on. More than a fifth of total oil consumption results from freight transportation, particularly long-distance shipments across the globe. If 3D printing enables a large-scale shift back to local manufacturing, as many have predicted it will, much of that oil consumption would be eliminated – great news for the environment, but not so good for the oil companies that rely on that business.

In the short term, BP isn’t too concerned – their 2017 BP Energy Outlook predicts that global demand for oil will continue to grow until the 2040s, with freight transport in Asia, particularly, driving the growth. In the long term, however, there are a number of factors the company is keeping an eye on, and 3D printing is one of them, according to BP chief economist Spencer Dale. Other future concerns are electric vehicles and renewable energy.

3D printed parking sensor prototypes

Nothing is set in stone for the future, of course, but there have certainly been plenty of indications that 3D printing is facilitating a gradual shift towards localized and in-house manufacturing, and away from the long-established practice of sourcing products and parts from outside manufacturers and vendors located thousands of miles away. How many case studies have we seen in which companies rave about how 3D printing allows them to prototype parts themselves in a matter of hours, rather than having to wait weeks for an outside contractor to create the parts for them and ship them back? Not only does in-house prototyping save time, it greatly reduces costs by eliminating the need to ship components back and forth.

The greater concern for BP and the oil industry overall appears to be the rise of electric vehicles, and Kingsmill Bond, energy analyst at investment research company Trusted Sources, thinks Dale and BP are being too optimistic about the continued dominance of the oil industry over the next few decades. According to Dale, while the rise of ride-sharing and electric and autonomous vehicles will make a dent in oil consumption, he believes that the continued growth of conventional vehicle manufacturing in Asia will mitigate the potential damage.

Not so fast, says Bond. He believes, conversely, that China will be a leader in clean technology, resulting in the decline of the oil industry as soon as the 2020s.

“People in the oil industry are in denial about what is happening,” he said.

Dale’s confidence in Asia as a reliable source of continual oil consumption may indeed be a bit too optimistic – in the last couple of years, the use of 3D printing in China alone has greatly increased, and some of the country’s major oil and gas producers, such as Sinopec, have expressed their intent to shift away from petrochemical production and towards 3D printing materials. China, which for years was notorious for its pollution, particularly in Beijing, has made a great effort over the last few years to reduce the amount of air pollution through investments in renewable energy.

There may indeed be some denial in the oil industry as it stares down a growing number of threats to its dominance. However, there’s little doubt that advanced manufacturing and alternative energy technologies will continue to grow, so oil companies could benefit from following the example of Sinopec and looking for ways to turn these technologies to their benefit before they are crowded out by them.

BP is also looking toward 3D printing as a technology of the future, as its 2015 Technology Outlook highlights the potential for 3D printing to create “Bespoke custom components in high-value applications.” The report, from November of that year, indicates that BP expects 3D printing to have a significant impact within the next few years. Furthermore, the company notes:

“The oil and gas industry – and many others – see opportunities to use this technology, especially to produce parts on-demand in a specific material. For example, 3D printers on an offshore facility may mean complex components can be manufactured in remote locations, saving time and improving efficiency. Uses of 3D printing is [sic] set to grow over the next 10 years as applications are identified and opportunities arise with new materials and equipment.”

Discuss in the BP forum at 3DPB.com.