Digital Transformation, Innovation Capability, and Institutional Sustainability in the Petroleum Sector: Evidence from RASCO, Libya

Abstract

This study examines the role of digital transformation in enhancing institutional sustainability in the petroleum sector, with specific reference to Ras Lanuf Oil and Gas Processing Company (RASCO), Libya. The study is based on a descriptive-analytical review of previous literature related to digital transformation, innovation capability, employee digital competence, and institutional sustainability. It argues that digital transformation should not be understood merely as the acquisition or installation of digital technologies, but as an integrated organizational and managerial transformation that reshapes operational routines, decision-making processes, maintenance practices, safety governance, and sustainability performance. The findings indicate that digital tools such as monitoring systems, predictive maintenance platforms, dashboards, artificial intelligence, and data analytics can support operational reliability, safety monitoring, environmental control, and evidence-based decision-making. However, these benefits are not automatic; they depend on the extent to which digital technologies are embedded into daily work routines, supported by managerial alignment, and connected to institutional sustainability objectives. The study further concludes that technology adoption alone is insufficient to achieve sustainable institutional performance unless it is supported by innovation capability and employee digital competence.