Gregory D. Len,apartner and registered patent attorney with Troutman Pepper Locke law firm, believes industrial gas firms need to step up in a data-driven digital era
The industrial gases industry shares many of the same digital pressures affecting all industries but is at an earlier stage of addressing the IP and data ownership questions that oil and gas operators have started to confront.
Industrial gas producers and distributors are actively adopting IoT-enabled monitoring systems, AI-driven logistics optimisation, and remote telemetry for plant operations.
Gregory D. Len
The global industrial gases market, valued at $116bn in 2024, is projected to reach $178bn by 2030. Digital technologies are central to that growth story, particularly in managing the complex logistics of gas cylinder distribution, plant efficiency, and predictive maintenance for air separation units and cryogenic storage.
But the contractual frameworks governing data generated by connected gas equipment, smart meters, remote tank monitors, and cylinder tracking sensors, have not kept pace.
Most technology agreements in the industrial gases space were written before these connected devices became standard, and they rarely specify whether the gas supplier, technology vendor, or the end customer owns the operational data those devices generate.
The sector also faces growing standard-essential patent (SEP) exposure that it has not yet had to navigate.
Industrial gas companies are deploying private 5G networks at production facilities and distribution hubs, and embedding cellular modules in field equipment and customer-site monitors.
Each of those deployments implicates the same 5G SEP licensing framework that has already reshaped the automotive and smart metering industries. Unlike oil and gas operators, most industrial gas companies have not yet conducted the kind of systematic SEP exposure assessment that the scale of these deployments warrants.
The 5G patent problem
5G is no longer a future concern for energy infrastructure. More than 66,000 active 5G patent families had been declared globally by October 2025. Any company embedding 5G modules in field equipment is implementing technologies that are subject to those patents, and SEP holders are actively pursuing licenses across industrial verticals.
The pattern is familiar. It started with smartphones, moved into connected vehicles, and is now reaching industrial IoT. When automakers began embedding cellular modules in cars, they found themselves unprepared for licensing demands from patent holders they had never dealt with.
An example of a patent pool that was built partly to address that problem, Avanci, the independent platform, offers automotive IoT licensees a single, fixed-rate license covering multiple SEP holders. Avanci has since expanded into Wi-Fi SEP licensing and launched a dedicated program for EV charging infrastructure, a direct signal that the licensing ecosystem is moving toward energy-adjacent use cases.
Energy companies, including those in the industrial gases space, should treat this as a practical procurement issue, not just a legal one. Before deploying 5G-connected field equipment, it is worth understanding which SEP pools apply, whether the equipment vendor’s license covers the intended use case, and what the realistic royalty cost looks like.
Building a smarter IP strategy
Effective IP management in the digital energy context starts with a straightforward audit: what data does the company generate, how is it protected, who has access to it under existing contracts, and what wireless technologies are embedded in field equipment?
From there, the priorities are practical. Service agreements should address data ownership, use restrictions, and post-termination obligations clearly. Trade secret protections for AI models and proprietary datasets need real access controls behind them.
Patent investment should focus on innovations that are genuinely hard to design around. And for any company deploying 5G or other standardised wireless technologies at scale, an SEP exposure assessment is a reasonable step before signing long-term equipment or service contracts.
Companies that fold IP strategy into their digital investment decisions early will be better positioned to protect what they build, negotiate from a place of strength, and avoid the disputes that tend to arise when rights are left undefined.
The energy sector is undergoing a digital transformation that goes well beyond updating old systems. Operators are now deploying artificial intelligence to optimise production, IoT sensor networks to monitor assets around the clock, autonomous drones for inspections in hazardous environments, and digital twin platforms to simulate entire physical operations before touching a single valve.
Investment in data analytics and AI in oil and gas alone is projected to exceed $7.1bn by 2026. The global IoT market in oil and gas was valued at $2.3bn in 2024 and is expected to reach $5bn by 2034.
That scale of investment brings a less obvious challenge: figuring out who owns what.
The most valuable IP in the industry used to be patents on downhole tools, seismic methods, or refinery chemistry. Today, it might be an AI model that predicts equipment failure with 95% accuracy, a decade’s worth of subsurface sensor readings, or a 5G-connected control algorithm running on a wellhead in a remote field. That tradition of protecting physical innovations continues, but the tools have changed.
Who owns the data?
The legal framework around operational data is still unsettled. Under US law, there is no property right in raw data as such. That leaves most protection to contracts and trade secret law, but only where companies have taken real steps to keep the data confidential.
The typical oilfield digital transaction puts an operator’s equipment in the field, a vendor’s cloud platform in the middle, and a service agreement that may say very little about who owns what.
Does the vendor have the right to train AI models on the operator’s production data and sell the results to a competitor? Can the vendor retain that data after the contract ends? These questions arise constantly, and the answers depend almost entirely on what the service agreement says. Companies that leave those provisions vague are accepting risk that is easy to avoid.
Joint ventures add another layer of complexity. As oil and gas JVs increasingly rely on shared digital platforms and co-developed AI tools, the parties need to agree upfront on how background IP (what each party brings in) is separated from foreground IP (what they build together). Without that structure, disputes over ownership and revenue-sharing tend to follow.
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