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BP to go all-in on public cloud to cut datacentre upkeep costs

Oil giant BP uses first day of AWS Re:Invent to outline how it is cushioning itself against falling oil prices by using cloud to cut costs

BP is in the process of moving workloads out of corporate datacentres and into the public cloud, as part of a push to cushion itself against the impact the fall in oil prices is having on its business.

Speaking at the Amazon Web Services (AWS) Re:Invent conference in Las Vegas, Paul Schuster, director of shared services architecture at BP, confirmed the oil and gas giant’s ambition is to go all-in on the public cloud for a mix of business agility and competitive reasons.

“It is an agility play for us, as our business is becoming increasingly competitive with abundant supply [of oil] now keeping prices low,” he said.

“In that context, digital technology innovation is having an important role across many aspects of our operations.”

As an example of this, he cited the way BP uses drones, robots and sensors to keep tabs on the condition and integrity of one of its 28,000 mile long pipelines in the US so it can optimise and improve the efficiency of its maintenance schedule.

The move to the public cloud began for BP in 2013, when the company moved to host its website on AWS, but – following a foray into the private cloud – the company is now working towards a full-scale datacentre exit, said Schuster.

“When we were [initially] working on our datacentre strategy, [we] envisaged a mix of private and public cloud with a service integration function on top,” he said.

“It started to feel very close to managed hosting, [and] didn’t feel evergreen and consumption-based.”

Lift and shift

The move to public cloud will require shifting at least 3,000 line of business applications to the cloud, as well as 7,000 servers, which are currently whirring away in four primary datacentre locations.

“We have a very significant fixed-cost challenge [around datacentres], primarily as a result of a historic bias towards owning assets, and that also means we divert a large portion of our IT budget towards maintaining end of life on that asset base,” said Schuster.

This, in turn, diverts funds away from areas that would allow BP to be more agile and flexible in the face of changing market conditions, he added.

“Digital technology is having a really big impact on our business and opening up opportunities for us. We need to be agile and flexible so we can take advantage of those opportunities as and when they arise, and make the right choices for our business,” he said.

“Cloud really helps us go after that [because] we need an IT cost base that is efficient and responsive to changes in our business cycle.”

Multi-year cloud move

The company’s push to embrace the public cloud will be a multi-year journey for BP, said Schuster, because some of its datacentres still have a few years to go until their leases are up.

“It’s hard for us to really dial-down our fixed costs unless we go for a full datacentre exit which takes time, is costly and so cloud becomes an additive cost until we can get that cost base run down,” he said.

The situation is also complicated further by the fact that parts of its business – such as its commodities trading arm – are regulated, while other bits are constrained by data sovereignty considerations.

Parts of its infrastructure and applications estate are outsourced too, and these arrangements will need to be reengineered as part of its move to the cloud.

“There may be applications we haven’t been able to retire, we can’t practically move them to the cloud, because it’s not economic,” said David Ninnis, senior enterprise architect at BP

“We will look to rehouse those – probably – in a colo [facility] when we come to the point where we’re going to switch off the datacentre. As of the rest, we either need to lift and shift, maybe refactor the architecture slightly or transform,” he added.

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