Oil & Gas Industry
Seven quick wins to lower costs and accelerate revenue
The sharp decline in oil prices from 2014 to early 2015 left oil executives scrambling to control losses as prices fell over 50% in six months. As companies assess their project portfolios and decide which projects to accelerate or cancel, there are seven areas that can help lower costs and accelerate revenue: 1) Analyzing portfolios to prioritize the most profitable projects, 2) Assessing portfolio risk to avoid delays and shutdowns, and 3) Dynamic monitoring and reporting of project data for efficient decision making. After project selection, driving down costs involves 4) Improving collaboration and compliance, 5) Managing changes effectively, 6) Integrating efficient supply chains
Shell gives green light to invest in LNG CanadaShell plc
Jessica Uhl, Chief Financial Officer of Royal Dutch Shell plc and Maarten Wetselaar, Integrated Gas & New Energies Director, will host a live audio webcast on Tuesday October 2, 2018 at 14:00 BST (15:00 CEST / 09:00 EDT / 06:00 PDT) about the final investment decision (FID) on LNG Canada on October 2, 2018.
Royal Dutch Shell plc third quarter 2020 resultsShell plc
On Thursday October 29, 2020 Royal Dutch Shell plc released its third quarter results and third interim dividend announcement for 2020.
Ben van Beurden, (CEO, Royal Dutch Shell plc) and Jessica Uhl (CFO, Royal Dutch Shell plc) host a results analyst webcast of the third quarter 2020 results.
Royal Dutch Shell plc Downstream Open House webcastShell plc
John Abbott, Downstream Director of Royal Dutch Shell plc host s a live analyst video webcast of the Downstream Open House for investors on Wednesday March 21, 2018 10:30 GMT (11:30 CET / 06:30 EST).
The Downstream Open House day has been designed to:
- Gain a better understanding of the Shell Downstream business and what sets us apart
- Hear new disclosures relating to investment, growth and new revenue streams
- Find out why our Downstream business remains resilient to crude prices and economic cycles
- Engage in open and focused dialogue with the Shell Downstream Leadership Team
John Abbott will be joined by: Huibert Vigeveno, EVP Global Commercial; István Kapitány, EVP Retail; Lori Ryerkerk, EVP Manufacturing; Andrew Smith, EVP Trading & Supply; Graham van’t Hoff, EVP Chemicals; Bjorn Fermin, EVP Downstream Finance; and Gerard Penning, EVP Downstream Human Resources.
Royal Dutch Shell plc - Enhanced disclosures webcastShell plc
On Tuesday, May 4 Tjerk Huysinga, Executive Vice President Investor Relations, Sinead Gorman, Executive Vice President Finance Upstream, Brian Eggleston, Executive Vice President Finance Downstream, Frank Lemmink, Executive Vice President Finance Integrated Gas and Renewables and Energy Solutions and Roland Ilube, Senior Vice President Finance Mobility host an enhanced quarterly disclosures webcast.
The Shell LNG Outlook, launched in London on February 20th, is an assessment of the global liquefied natural gas (LNG) market. It finds that China and India were two of the fastest growing buyers, with the number of LNG importers worldwide up to 35, from 10 at the start of the century.
Read the Shell LNG Outlook in full at http://www.shell.com/lngoutlook
Royal Dutch Shell plc capital markets day 2016 Shell plc
Ben van Beurden, Chief Executive Officer of Royal Dutch Shell plc hosted a live analyst video webcast of the Capital Markets Day on Tuesday June 7, 2016, providing an update on the company’s strategy, that sets a clear course for stronger returns and free cash flow.
2012 Management Day London/New York - Global Gas Perspectives and Asia Pacifi...Shell plc
Shell hosted a management day with investors in London (Wednesday 14th November 2012) and New York (Thursday 15th November 2012) focusing on global gas perspectives and Asia Pacific outlook. Presentations were lead by Chief Executive Officer, Peter Voser and Chief Financial Officer, Simon Henry followed by Andrew Brown (Director Upstream International) and Matthias Bichsel (Director Projects & Technology).
Shell gives green light to invest in LNG CanadaShell plc
Jessica Uhl, Chief Financial Officer of Royal Dutch Shell plc and Maarten Wetselaar, Integrated Gas & New Energies Director, will host a live audio webcast on Tuesday October 2, 2018 at 14:00 BST (15:00 CEST / 09:00 EDT / 06:00 PDT) about the final investment decision (FID) on LNG Canada on October 2, 2018.
Royal Dutch Shell plc third quarter 2020 resultsShell plc
On Thursday October 29, 2020 Royal Dutch Shell plc released its third quarter results and third interim dividend announcement for 2020.
Ben van Beurden, (CEO, Royal Dutch Shell plc) and Jessica Uhl (CFO, Royal Dutch Shell plc) host a results analyst webcast of the third quarter 2020 results.
Royal Dutch Shell plc Downstream Open House webcastShell plc
John Abbott, Downstream Director of Royal Dutch Shell plc host s a live analyst video webcast of the Downstream Open House for investors on Wednesday March 21, 2018 10:30 GMT (11:30 CET / 06:30 EST).
The Downstream Open House day has been designed to:
- Gain a better understanding of the Shell Downstream business and what sets us apart
- Hear new disclosures relating to investment, growth and new revenue streams
- Find out why our Downstream business remains resilient to crude prices and economic cycles
- Engage in open and focused dialogue with the Shell Downstream Leadership Team
John Abbott will be joined by: Huibert Vigeveno, EVP Global Commercial; István Kapitány, EVP Retail; Lori Ryerkerk, EVP Manufacturing; Andrew Smith, EVP Trading & Supply; Graham van’t Hoff, EVP Chemicals; Bjorn Fermin, EVP Downstream Finance; and Gerard Penning, EVP Downstream Human Resources.
Royal Dutch Shell plc - Enhanced disclosures webcastShell plc
On Tuesday, May 4 Tjerk Huysinga, Executive Vice President Investor Relations, Sinead Gorman, Executive Vice President Finance Upstream, Brian Eggleston, Executive Vice President Finance Downstream, Frank Lemmink, Executive Vice President Finance Integrated Gas and Renewables and Energy Solutions and Roland Ilube, Senior Vice President Finance Mobility host an enhanced quarterly disclosures webcast.
The Shell LNG Outlook, launched in London on February 20th, is an assessment of the global liquefied natural gas (LNG) market. It finds that China and India were two of the fastest growing buyers, with the number of LNG importers worldwide up to 35, from 10 at the start of the century.
Read the Shell LNG Outlook in full at http://www.shell.com/lngoutlook
Royal Dutch Shell plc capital markets day 2016 Shell plc
Ben van Beurden, Chief Executive Officer of Royal Dutch Shell plc hosted a live analyst video webcast of the Capital Markets Day on Tuesday June 7, 2016, providing an update on the company’s strategy, that sets a clear course for stronger returns and free cash flow.
2012 Management Day London/New York - Global Gas Perspectives and Asia Pacifi...Shell plc
Shell hosted a management day with investors in London (Wednesday 14th November 2012) and New York (Thursday 15th November 2012) focusing on global gas perspectives and Asia Pacific outlook. Presentations were lead by Chief Executive Officer, Peter Voser and Chief Financial Officer, Simon Henry followed by Andrew Brown (Director Upstream International) and Matthias Bichsel (Director Projects & Technology).
Shell responsible investor briefing in London – April 16, 2018Shell plc
Ben van Beurden, Chief Executive Officer, Hans Wijers, Non-Executive Director and Chair of the Corporate and Social Responsibility Committee, Harry Brekelmans, Projects & Technology Director, Donny Ching, Legal Director, and Maarten Wetselaar, Integrated Gas & New Energies Director, presented in London during the annual responsible investors briefing.
Report: The Crude Downturn for E&Ps: One Situation, Diverse ResponsesMarcellus Drilling News
A report issued by consulting firm Deloitte with bad news for the oil and gas industry. The study reveals that 35% of "pure play" drillers (those who invest in and concentrate all of their efforts in a single shale play) are at "high-risk of slipping into bankruptcy in 2016." That's a total of some 175 companies nationwide.
Royal Dutch Shell plc second quarter 2020 resultsShell plc
On Thursday July 30, 2020 Royal Dutch Shell plc released its second quarter results and second interim dividend announcement for 2020.
Ben van Beurden, (CEO, Royal Dutch Shell plc) and Jessica Uhl (CFO, Royal Dutch Shell plc) hosted a teleconference and audio webcast of the second quarter 2020 results on Thursday July 30, 2020.
This is the first edition of the Deloitte Outlook for oilfield services. The forward-looking report is based on in-depth interviews with 12 executives of oilfield services companies. Its purpose is to obtain companies’ views of their current business environment and where they think the market is heading, both in the short and long term.
The global liquefied natural gas (LNG) market has continued to defy expectations, growing by 29 million tonnes in 2017, according to Shell's latest LNG Outlook. Based on current demand projections, Shell sees potential for a supply shortage developing in the mid-2020s, unless new LNG production project commitments are made soon.
Shell Oil has been employing scenario planning practices as a way to analyze its market the impacts that global and regional events and shifts may have for decades. These same principles and practices can be applied to any business and are particularly useful, when scaled appropriate, to business decision-making in energy industries.
New base energy news issue 890 dated 21 july 2016Khaled Al Awadi
Greetings,
Attached FYI (NewBase Special 21 July 2016 ) , from Hawk Energy Services Dubai . Daily energy news covering the MENA area and related worldwide energy news. In today’s issue you will find news about:-
• Third reactor vessel installed at UAE’s Barakah plant
• Saudi Aramco signs contracts for Fadhili gas project
• India continues developing its strategic petroleum reserve as its oil imports grow
• UK: Premier Oil spuds well on the Bagpuss Prospect in UKCS Blocks 13/24 & 25
• Malaysia:Drillship Deepsea Metro I starts drilling ops for Petronas
• Crude oil nudges up after ninth weekly stock drawdown in US
• Oil prices set to peak sooner than expected on supply shortage, Barclays says
• The Risk Oil Drillers Couldn’t Hedge Away
• Chevron inks LNG deal with China’s JOVO
• Chevron’s Gorgon LNG plant nearing restart
we would appreciate your actions to send to all interested parties that you may wish. Also note that if you or your organization wish to include your own article or advert in our circulations, please send it to :-
khdmohd@hotmail.com or khdmohd@hawkenergy.net
Best Regards.
Khaled Al Awadi
Energy Consultant & NewBase Chairman - Senior Chief Editor
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME meme since 1995
Hawk Energy since 2010
Shell responsible investor briefing in London – April 16, 2018Shell plc
Ben van Beurden, Chief Executive Officer, Hans Wijers, Non-Executive Director and Chair of the Corporate and Social Responsibility Committee, Harry Brekelmans, Projects & Technology Director, Donny Ching, Legal Director, and Maarten Wetselaar, Integrated Gas & New Energies Director, presented in London during the annual responsible investors briefing.
Report: The Crude Downturn for E&Ps: One Situation, Diverse ResponsesMarcellus Drilling News
A report issued by consulting firm Deloitte with bad news for the oil and gas industry. The study reveals that 35% of "pure play" drillers (those who invest in and concentrate all of their efforts in a single shale play) are at "high-risk of slipping into bankruptcy in 2016." That's a total of some 175 companies nationwide.
Royal Dutch Shell plc second quarter 2020 resultsShell plc
On Thursday July 30, 2020 Royal Dutch Shell plc released its second quarter results and second interim dividend announcement for 2020.
Ben van Beurden, (CEO, Royal Dutch Shell plc) and Jessica Uhl (CFO, Royal Dutch Shell plc) hosted a teleconference and audio webcast of the second quarter 2020 results on Thursday July 30, 2020.
This is the first edition of the Deloitte Outlook for oilfield services. The forward-looking report is based on in-depth interviews with 12 executives of oilfield services companies. Its purpose is to obtain companies’ views of their current business environment and where they think the market is heading, both in the short and long term.
The global liquefied natural gas (LNG) market has continued to defy expectations, growing by 29 million tonnes in 2017, according to Shell's latest LNG Outlook. Based on current demand projections, Shell sees potential for a supply shortage developing in the mid-2020s, unless new LNG production project commitments are made soon.
Shell Oil has been employing scenario planning practices as a way to analyze its market the impacts that global and regional events and shifts may have for decades. These same principles and practices can be applied to any business and are particularly useful, when scaled appropriate, to business decision-making in energy industries.
New base energy news issue 890 dated 21 july 2016Khaled Al Awadi
Greetings,
Attached FYI (NewBase Special 21 July 2016 ) , from Hawk Energy Services Dubai . Daily energy news covering the MENA area and related worldwide energy news. In today’s issue you will find news about:-
• Third reactor vessel installed at UAE’s Barakah plant
• Saudi Aramco signs contracts for Fadhili gas project
• India continues developing its strategic petroleum reserve as its oil imports grow
• UK: Premier Oil spuds well on the Bagpuss Prospect in UKCS Blocks 13/24 & 25
• Malaysia:Drillship Deepsea Metro I starts drilling ops for Petronas
• Crude oil nudges up after ninth weekly stock drawdown in US
• Oil prices set to peak sooner than expected on supply shortage, Barclays says
• The Risk Oil Drillers Couldn’t Hedge Away
• Chevron inks LNG deal with China’s JOVO
• Chevron’s Gorgon LNG plant nearing restart
we would appreciate your actions to send to all interested parties that you may wish. Also note that if you or your organization wish to include your own article or advert in our circulations, please send it to :-
khdmohd@hotmail.com or khdmohd@hawkenergy.net
Best Regards.
Khaled Al Awadi
Energy Consultant & NewBase Chairman - Senior Chief Editor
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME meme since 1995
Hawk Energy since 2010
The Secrets of Succesful Front End Engineering
In this AE Foyer Glenn Dejaeger and Thomas Anciaux will focus on Trends and Aspects of front end engineering. When do you choose a native front end, when should you go web? What is a good front end architecture? How do you cover the design, development, test and lifecycle aspects of a professional front end? How to survive in the jungle of frameworks? What are the current insights and future directions in front end engineering? How do you deal with offline mobile? Do you need front end engineers?
CRUDE OIL AND ITS IMPACT ON SOIL POLLUTION: ENVIRONMENTAL RISK ASSESSMENT IAEME Publication
Environmental risk assessment is a scientific activity that includes a significant review of the information or data for quantifying and identifying the risk linked to prospective risk. Risk management is applied to know the need to compel the measures to control and manage the risk. The working methodology in this paper is based on various research studies that relates to environmental risk for soil pollution with hydrocarbons obtained from accidental crude oil spills. Data is required for the separation of gas oil, which is complex, and its assessment of the environmental risk for industrial sites for drilling is done by various quantitative and qualitative methods.
Introductory paper related to project risk management and written by Professor Marco Sampietro and Professor Maurizio Poli . The paper explains the main project risk management phases (process planning, identification, analysis, response, monitoring&control) and presents both the qualitative and the quantitative approach.
Front End Engineering Design (FEED) Project Control TrainingDEVELOP
DEVELOP Training Center (TM) conducts Front End Engineering Design (FEED) Project Control Training, which is very useful to gain skills on how to plan & control projects, as well as navigate and optimize the Project execution.
This training will be useful to gain skills on how to plan & control projects, as well as navigate and optimize the FEED Project execution, such as : FEED Work Order-Scope,FEED Stakeholder identification,FEED Project Deliverables,FEED Multidiscipline Man-hour Calculation-productivity,Engineering-Procurement-Construction Project Contract technical issues-investment Cost Estimation ,FEED Review Cycle,EPC Long lead items,FEED Close out Report-Lessons Learnt
Study 2: Front-End Engineering Design and Project DefinitionGerard B. Hawkins
Study 2: Front-End Engineering Design and Project Definition
CONTENTS
2.0 PURPOSE
2.0.1 Team
2.0.2 Timing
2.0.3 Documentation
HAZARD STUDY 2: APPLICATION
2.1 Study of Process and Non-Process Activities
2.2 Study of Programmable Electronic Systems (PES)
2.3 Risk Assessment
2.4 Defining the Basis for Safe Operation
2.5 Review of Hazard Study 2
APPENDICES
Appendix A Hazard Study 2 Method
A.1 Significant Hazards Flowsheet
A.2 Event Guide Diagram
A.3 Consequence Guide Diagram
A.4 Typical Measures to Reduce Consequences
Appendix B Programmable Electronic Systems (PES) Guide Diagram
Appendix C Risk Assessment
C.1 Risk Assessment Procedure
C.2 Risk Matrix
C.3 Risk Matrix Guidance for Consequence Categories – Safety and Health Incidents
C.4 Risk Matrix Guidance for Consequence Categories – Environmental Incidents
Appendix D Key Hazards and Control Measures
Appendix E Content of Hazard Study 2 Report Package.
Q2 – Analyst Themes of Quarterly Oil & Gas EarningsEY
Most companies reported strong earnings growth in the second quarter, but investors were disappointed. Expectations had risen in line with oil prices and profits, but cash flow generation of some companies fell short of consensus estimates.
Sliding Oil Prices: Predicament or ProspectCognizant
Given the steep plunge in crude oil prices and resulting cash crunch, now is the perfect time for oil and gas companies to revisit their value tree and synchronize business and IT strategies.
Oil & Gas ICT Leader 2017 - Day 1 April 19th Ray Bugg
The industry is changing: against a challenging backdrop with a ‘lower for longer’ economic forecast, Oil & Gas companies are turning to technology to modernise and improve their operations. This transformation has seen IT repositioned as a core business technology, drawn from a background support function to a crucial centre of value creation and innovation. This tectonic shift places IT leaders in a vital position within their organisation, ensuring existing assets and emerging technology are effectively harnessed to deliver tangible business outcomes.
Cost reduction is still the primary mandate for most organisations, with ongoing efforts to strip back overheads and address key areas of inefficiency to cope with tightening budgetary restraints. But while the pursuit of ‘more for less’ has become a fundamental necessity, it is important that the strategy employs sufficient safeguards to avoid stifling long term progress. Organisations need to retain the personnel, the skills and the tools to ensure they still have the capacity to innovate.
One of the most prevalent trends of recent years has been a concerted move towards greater automation. Organisations are increasingly incorporating sensors, robotics and live data feeds to enhanced remote operations. But this digitisation of process is not just taking place in far flung fields; across the operation, digital technologies are being applied to enable improved visibility and insight. And data analytics is increasingly being used to evaluate asset performance, and enhance predictability, forecasting and decision making.
Whilst operators have made strides to address inefficiencies and create faster, more agile processes, there are still several barriers to progress. Organisations need to adapt their structure, break down internal silos and allow more cohesive and collaborative engagement. This collaboration also needs to extend to the wider supply chain and external partners across the industry. Skills and leadership is also a key barrier to progress, while cultural inertia still poses a problem for the industry and needs to be tackled head-on if digital transformation ambitions are to be achieved.
This conference will bring together IT leaders from across the world for knowledge exchange, thought leadership and collaboration. Now in its 4th year, the conference has established itself as the must-attend event for IT leaders working in Oil & Gas. The programme will explore the use of Information Technology in driving tangible business benefits, with topics spanning: data analytics, cloud, cyber security, automation, leadership and culture.
Methanex is the world's largest producer and supplier of methanol. We create value through our leadership in the global production, marketing and delivery of methanol to customers. View our latest Investor Presentation for more details.
Analyst themes of quarterly oil and gas earnings Q4 2018EY
The oil and gas industry started the fourth quarter of 2018 with high hopes. Oil prices had risen in the last half of the third quarter and indicators were pointing upward. As is often the case, events took over and oil prices erased all the gains made since the beginning of 2017.
PwC White Paper: Shale Gas - New conventions for unconventional development f...Marcellus Drilling News
A white paper published by PricewaterhouseCoopers with some times for engineering and construction companies involved in the shale drilling industry, purporting to show them how (with PwC's help) they can cut down the time and costs involved with the projects they undertake in the shale drilling industry.
Navigating the Crude Cycle: Opportunities for Midstream Energy Companiesaccenture
Amid volatile oil prices, North American midstream energy companies are being presented with unique opportunities. The challenge: to seize the moment and take purposeful action to build agile organizations that can perform successfully in any cycle.
Mercer Capital's Value Focus: Energy Industry | Q1 2018 | Segment: Explorati...Mercer Capital
Mercer Capital's Energy Industry newsletter provides perspective on valuation issues. Each newsletter also typically includes macroeconomic trends, industry trends, and guideline public company metrics.
OBU – Oxford Brookes University BSc Honours in Applied Accounting.Academic Mania
Topic 8: The Business and Financial Performance of an Organization over a three year period.’
Oxford Brookes (OBU) ACCA Applied Accounting RAP Thesis For
ACCA Oxford Brookes BSc (Hons) in Applied Accounting
Similar to Seven quick wins to lower costs and accelerate revenue (20)
OBU – Oxford Brookes University BSc Honours in Applied Accounting.
Seven quick wins to lower costs and accelerate revenue
1. Oil & Gas Industry
Seven quick wins to lower costs and accelerate revenue
O R A C L E W H I T E P A P E R | A P R I L 2 0 1 5
2. 1 | SEVEN QUICK WINS TO LOWER COSTS AND ACCELERATE REVENUE
Introduction
The sharp decline in oil prices that began in 2014 left oil executives in a free fall with oil prices hitting a
five-year low in early 2015 when the price of Brent crude temporarily fell below $50 per barrel for the
first time since May 2009, marking a 53% drop in just six months.
The stomach-churning fall left oil executives scrambling to control huge losses of more than $100
billion in annualized revenue for U.S. producers.
By the end of April 2015, crude oil prices still hovered in the $50 per barrel range. The freefall had
ended, but the landing was far from reassuring.
As the dust settles, other realities have become apparent. The decline in crude price raises fears that
small exploration and production companies could go out of business. It’s also bad news for the largest
oil companies, which have raced to adjust their production and spending plans. BP announced that it
would spend about $1 billion in restructuring in 2015 and lay off hundreds of workers. They also
reduced spending on development by up to $2 billion. U.S. oil giant ConocoPhillips also announced
that it would cut capital spending by 20%. Many energy companies have already started to cut drilling.1
The forecast has even turned chilly for shale oil drilling. The number of rigs drilling for oil in North
Dakota and parts of Texas has started to edge down. New drilling permits have dropped sharply since
October, and many companies say they are going to focus on their most profitable wells.
Oil companies that have made big bets on shale-rock formation in the U.S., a resource that became
economically feasible to tap with the advent of new drilling technology, have become victims of their
own success. Their shares have been pummeled, too, by the decline in oil prices, which is likely to cut
deeply into their revenues and impact their ability to service their high levels of debt.
Oil field service companies and drillers have been among the hardest hit, owing to the likelihood that
producers will spend less on new projects and ongoing maintenance work.
As recently as March 2014, global energy chiefs at a U.S. conference in Houston were lamenting over
the soaring costs of their oil and gas projects, even as oil hovered above $100 per barrel.2
One CEO
told the crowd that labor and capital costs at his company had doubled over the last decade, and that
to pay for the rising price of extracting fossil fuels, the industry needs triple-digit oil prices.
3. 2 | SEVEN QUICK WINS TO LOWER COSTS AND ACCELERATE REVENUE
Today, oil executives must move toward accepting that this may be the new normal. Oil companies
must consider two broad courses of action. First, executives must be able to quickly determine which
projects will yield the highest long-term revenues and then accelerate time to first oil. This production
imperative involves selecting the most profitable projects, mitigating risk and uncertainty, and
performing ongoing dynamic monitoring.
Second, oil companies must lower costs. This involves improving contractor collaboration, effectively
managing change and aligning costs with schedule – all leading to improved margins. Among other
things, optimizing maintenance via an enhanced supply chain and logistics is key here.
Many oil companies have already pulled back capital spending by 20%-25%. But cuts across the
board without a judicious, programmatic approach to their portfolio and modeling out future scenarios
can jeopardize profitability and productivity from a development standpoint in the long run.
A comprehensive enterprise project portfolio management (EPPM) solution is critical for oil companies
to help them gain a clearer picture of the current situation and identify areas of opportunity, lower risk
and spot opportunities for innovation to improve their current situation and portfolio outlook for both the
short and long term.
Companies can potentially lower costs and accelerate revenue in seven key areas.
Accelerating Revenue
As companies assess their portfolio, these areas should be considered:
1. Modeling & analyzing portfolios
Oil companies need to plan capital expenditure carefully and prioritize projects that will deliver. Just as “easy oil” is
a thing of the past, “easy capital” no longer exists, and investments in production and exploration are receiving
heightened scrutiny. Oil and gas companies need to demonstrate that the opportunities they pursue will deliver the
greatest possible returns.
Savings of 10% can be made on capital projects budgets by adopting up-front strategic planning. - McKinsey 2013
A powerful enterprise project portfolio management (EPPM) analytics tool provides the forecasting capabilities oil
and gas companies need to identify, prioritize and select the right upstream, midstream and downstream projects.
Scenario analysis and decision optimization deliver the information required to predict likely outcomes and
determine the probability of success. The result: Companies make investments that make sense, and production
and exploration projects pay off.
Conversely, when deciding which projects to temporarily or permanently halt, an EPPM solution can analyze the
portfolio impact that the shutdowns or turnarounds might have, as well as planned decommissioning projects.
4. 3 | SEVEN QUICK WINS TO LOWER COSTS AND ACCELERATE REVENUE
Only 22% of oil and gas companies have a plan in place for the retirement phase of their assets, according to
Aberdeen Group.3
Decommissioning projects are often long and complex. One small change or event can have a
ripple effect across the entire organization. An asset-decommissioning plan should also focus on risk and financial
management, operational excellence and innovation.
With scares resources, it becomes even more important to have real-time visibility into the project so project leaders
can look for potential problems before they become issues.
Decommissioning is also an opportunity to invite innovation. Continuous improvement has become the cornerstone
for transforming the oil and gas industry. Companies should focus on applying previous lessons learned to the
permitting and regulatory compliance process of decommissioning, according to Aberdeen. Execution plans from
previous projects can serve as guidelines or templates to secure permits from the federal, state or local agencies for
future projects.
It’s also important to keep decommissioning projects on time and within budget. While there are no production
losses by not finishing a decommissioning project on time – it can lead to additional resources being needed to
complete the project, according to Aberdeen.4
These resources could have been used to invest further in the
business. Companies that have plans in place ahead of time to decommission assets reap the benefits that get
carried over to future projects.
2. Assessing portfolio risk
Most companies experience an average 15% decline in share price after publicly announcing a capital project delay
or shutdown. – PwC 2013
Companies in the top 20% of risk management maturity delivered three times the level of EBITDA when compared
to companies in the bottom 20%. – EY 2011
Whether investing in new projects or shutting down others, risk management is a key factor, often driven by a clear
view of every aspect of a project and its dependencies.
For instance, how do you know where to drill with the least amount of risk? Some companies will be able to keep
pumping even at lower prices, depending on the location and quality of their wells.5
Enterprise Products Partners LP,
which operates pipelines and oil storage terminals across the U.S., says its analysis shows that the average well in
many shale formations aren’t profitable at $60 oil. But wells considered high grade can withstand much lower prices,
such as some wells in South Texas, which are profitable at prices of $30 a barrel.
Oil companies need an EPPM system that helps identify these opportunities and avoid risk.
3. Dynamic monitoring & reporting
50% of oil and gas companies will have advanced analytics capabilities in place by 2016. – IDC 2014
Oil companies must take note of the way their organizations have adopted big data and detailed analytics to assist
them with the management of their project portfolio. Capturing project delivery data has never been easier.
5. 4 | SEVEN QUICK WINS TO LOWER COSTS AND ACCELERATE REVENUE
Companies now have the ability to capture information from the global supply chain through SaaS-based project
management solutions, and the field is now enabled to deliver up-to-the-minute data via mobile solutions specifically
designed to work on tablets and smart phones. Capturing that data and then translating it into meaningful analytics
that can be provided to stakeholders -- both internal and external -- will enable faster, more efficient and therefore
cost-effective decision-making.
Driving Down Costs
After oil companies decide which projects to go forward with, those projects must be executed efficiently and in a
low-cost way. The following aspects should be considered to make this happen.
4. Improving collaboration and compliance
The most innovative 20% of organizations grew at a rate 16% higher than the least innovative. – PwC
Operational excellence helps to drive down costs and improve efficiencies. Although most of the attention is on
capital projects, as it should be, maintenance and operations are areas with significant cost savings potential. Oil
and gas companies need to improve productivity while improving quality. They also need to ensure that well-defined
standard operating procedures are supported, automated and complied with by both the owner organization and the
supply chain. Standardizing processes and ensuring parties are alerted to actions, including non-compliance, are
important factors in driving efficiencies throughout projects.
5. Managing change
Project-intensive industries report that an average of 15% of their major capital projects experience change orders. –
McGraw-Hill Construction 2011
Oil and gas stakeholders – whether they are owners, services organizations or part of the supply chain -- are well
aware that projects change from the day they are approved. Yet they still struggle with the ability to capture change
and manage all the subsequent documentation that can help them maneuver through these curves in the road.
Standard processes and tools found in EPPM solutions can help organizations account for the impact of both
financial and scheduling changes across the portfolio of projects.
6. Integrating supply chains
Improved supplier collaboration reduces rig downtime costs by 12% for project-driven supply chains. – Booz &
Company 2010 (now Strategy@)
Oil and gas companies need to find and capture best practices and extend them wherever they can add value.
Continuous improvement in all areas of the organization, including back-office functions, is critical to enhancing
processes to make them more efficient. Companies that can manage all resources, including labor, equipment
6. 5 | SEVEN QUICK WINS TO LOWER COSTS AND ACCELERATE REVENUE
and materials, across an organization’s integrated portfolio plan – capital projects, ongoing operations, etc. -- can
also help drive strategy in determining procurement, human capital and contracting approaches. What’s more,
incorporating the integrated project plan with the supply chain ensures that resources are provisioned and
delivered to meet the needs of the project.
7. Improving operations and maintenance
Improved planning of maintenance activities delivers 10% savings. – McKinsey 2013
Oil and gas companies must maximize online availability of their assets to deliver oil and gas or refined products,
while minimizing operating expenses. Companies that can effectively plan and execute shutdowns and routine
maintenance also improve the operational efficiency of their assets and can better meet the goals of the
organization.
To this end, enterprises are looking at a number of areas to enhance efficiencies and drive down costs, including
long-range planning, scope refinement, resource and risk optimization, efficient field execution and change control.
Typically, the focus in these areas is to automate the very manual processes that exist in most operations and
maintenance organizations, since this further enhances efficiencies and also provides a heightened level of
governance over all operations and maintenance activities.
The Solution
Oracle’s Primavera oil and gas industry team approaches EPPM as a strategic issue that demands board-level
engagement, rather than a niche or specialist operational function. Our oil and gas clients get a single version of the
truth for their organization, real-time visibility of all relevant information from start to finish, and integration of project
and program resources.
Additionally, oil and gas companies get immediate access to key performance indicators, cost and budget
alignment, and detailed audit trails of all transactions. As a result, project issues are easy to identify, corrections can
be made mid-course and resources can be quickly allocated effectively and efficiently.
Conclusion
Enterprise project portfolio management is mission critical to the oil and gas industry, which is driven by billions of
dollars in capital investments. These large-scale exploration and production projects, if they fail, have an impact on
the company and their share price. EPPM provides that full end-to-end capability to support the capital asset
lifecycle – from planning, building & construction, operation & maintenance, to decommissioning.