Baker Hughes and C3.ai Form Joint Venture for Oil & Gas Industry
Oilfield services firm Baker Hughes, a GE company, and artificial intelligence startup C3.ai have announced a joint venture to accelerate digital transformation of the oil and gas industry. As part of the deal, Baker Hughes, which is 50 percent owned by GE, has taken a minority equity position in C3.ai and gets a seat on its board.
The joint venture combines Baker Hughes’ full-stream oil and gas domain expertise with C3.ai’s AI platform, which specializes in analyzing the massive amounts of data generated by industrial Internet of Things platforms. The agreement calls for the two firms to immediately market and deploy C3.ai’s C3 AI Suite and applications to oil and gas businesses. They will also work together to build new AI applications specific to the oil and gas industry and offer joint professional services. Baker Hughes will deploy the C3.ai suite across its own business as well.
With this joint venture with Baker Hughes, C3.ai is clearly doubling down on the energy market. The firm’s earliest adopters were oil and gas firms using its platform for asset management and predictive maintenance and most of its reference customers today are in either energy generation or utilities. Shell Energy is a joint customer of both C3.ai and Baker Hughes. Other C3.ai reference customers include BGE, ConEdison, Duke Energy, Endesa, Enel Green Power, Engie, Eversource, Exelon, New York Power Authority, Public Service Company of Oklahoma, and SunPower
C3.ai has attempted to diversify into other industries, including manufacturing, aerospace and defense, banking, healthcare, public sector/cities, retail, telecommunications and transportation. It’s announced some reference customers from these sectors, including 3M, the U.S. Air Force and the U.S. Department of Defense. But the asset-intensive and highly distributed energy industry figures to be the firm’s focus going forward.
Improving safety and efficiency at oil and gas facilities through better predictive maintenance will be a target benefit of the joint agreement. The oil and gas industry continues to struggle with safety, as last week’s massive explosion and fire at the Philadelphia Energy Solutions refinery—the largest oil refinery on the US East Coast—demonstrated. From 2008 through 2017, 1,566 workers were killed in accidents in the US oil-and-gas drilling industry and related fields, according to data from the U.S. Department of Labor’s Bureau of Labor Statistics. The fatality rate is about five times the rate of all other U.S. industries combined.