Oil is the Last Frontier for Blockchain; IBM, Venezuela

Although crude oil is trading near 2018 lows, it seems black gold companies and organisations are watching the Blockchain technology as a way to upgrade and make more efficient their businesses. IBM, Abu Dhabi, and Venezuela are samples of that.

IBM and Abu Dhabi develop a blockchain supply chain system

The United Arab Emirates-based Abu Dhabi National Oil Company, ADNOC, and IBM have developed a pilot blockchain supply chain system for its oil and gas businesses, according to a press release published by the ADNOC.

The project provides a single platform that tracks the volume and financial values of each transaction, and it applies the information in automated accounting software.

According to ADNOC press release, “using Blockchain technology will reduce the time it takes to execute transactions between ADNOC’s operating companies and significantly increase operational efficiencies across its full value chain.”

“It will also improve the reliability of production data by enabling greater transparency in transactions,” adds the announcement.

ADNOC Digital Unit Manager, Abdul Nasser Al Mughairbi, stated that “this could be the first application of blockchain in oil and gas production,” in the World Energy Capital Assembly in London this weekend.

“Blockchain is a game-changer,” Al Mughairbi also said in the conference. “It will substantially reduce our operating costs by eliminating time-consuming and labour-intensive processes, strengthen the marketing and trading of our products, and create long-term sustainable value.”

It is “a massive leap forward in asset provenance and asset financials,” stated IBM’s Chemicals and Petroleum Solutions VP, Zahid Habib. The system claims to be an irrefutable track for every module of oil, its value, and customers.

“This unlocks the potential to digitally reinvent ADNOC’s hydrocarbon value chain,” concluded Habib.

Last week, VAKT, an oil-trading blockchain platform, was launched to a group of crude oil industry companies such as Equinox, BP, Gunvor, Shell and Mercuria. It will be available for the public in 2019.

VAKT is based on JPMorgan’s Quorum blockchain technology to work in the physically traded BFOET crude oil business.

“VAKT has created a secure, real-time blockchain-based digital platform, working with global software consultancy ThoughtWorks and underpinned by JPMorgan’s Quorum private distributed ledger,” said the press release. “The platform manages physical energy transactions from trade entry to final settlement, eliminating reconciliation and paper-based processes.”

Venezuela to use crypto coin Petro to sell oil and stop Dollar dependence

Nicolas Maduro, Venezuela’s president, said the South American country would start selling oil in its cryptocurrency Petro in 2019 as a measure to build up economic independence, according to state-media Telesur.

Maduro is fighting against the dollar and Washington elites. He said that “in 2019, we have a schedule for oil to be sold in Petros and in this way continue to free us from a currency that the elite of Washington uses.”

Long story short, Maduro is working in a six-year plan to implement the cryptocurrency as a critical token to avoid the economic and financial sanctions the United States has approved against Venezuela’s economy.

President Maduro highlights that Russia is buying and selling oil and gas in Chinese Yuans, “we are going to sell our entire oil production in Petros progressively.”