Here’s some fuel for thought- No matter what technologies are being used right now to improve functions, future growth will always be on the back of the mind- whether it is P2P (i.e procure & pay), spend analytics, data-driven optimization or innovative ways to monitor the rigs. Crude oil prices will continue to dominate the processes and the way business will move forward. In the USA, after the boom more than a decade ago, oil prices have not shown any inclination to rebound. Thus, it makes energy companies re-think about provenance (authenticity) and other strategies to cut costs. The implementation of future growth now lies with oil and gas vendor spend analytics- to target quality data from multiple sources.
If your business needs new fuel to continue and set new ROI targets the following think tank may provide some informative insight for upstream companies.
Have you invested in IT resources?
The first goal is to have a strong IT structure within the company to manipulate data sources. Any new analytical methods that will be required for applications will need constant review to have a significant impact on spending necessities. New insights will continuously be churned out onsite. The provenance of the emerging high-speed data can easily be supported by a strong blockchain profile. This is one of the best ways to ensure that all the well data is updated. For example, when multiple vendors offer services and products to companies in the energy sector, the blockchain ledger is a single point where every information originates. This is the core capability of the block ledger technology which is also being used by many other industries successfully. In the case of oil and gas vendor spend analytics, it enables every follow-up, the action right from the beginning of the supply to the end. It takes care of six essential verticals-procurement, producing, transportation (of all supplies), installations, various trading platform details, resale of energy products in the appropriate markets. The data is reconciled at targeted periods and works easily without any human intervention.
This IT investment is mainly to ensure the provenance quality is authentic as 3rd party vendors are involved in many stages. The advanced use of analytics is veneering towards sensor-based technologies.
Deciphering sophisticated reservoir data via sensors and mobility
As methods of procuring reservoir data get more sophisticated, there is more accuracy in decision making and increasing the rate of production. For instance, if a particular well is not yielding any results, it can be managed in another way or abandoned depending on the information procured by streaming data. Sensor-based technologies are helping decision makers to improve any declining curve that hits the oil well. It allows swift management in dealing with the supplies that are routed to the performing and non-performing assets. Sensors provide details in a more precise manner. Mobility is yet another important part of the infrastructure. Operations can be conducted in an efficient manner once the vendors have delivered the supplies. Mobility allows operators and corporate staff to coordinate data and to remain connected 24 x 7.
Both mobility and sensor-based processes help communications and collaborations. Operational efficiency via automation is helping operators to become an agile workforce.
Dealing with vendors continuously with contract codes
Making contracts with vendors can be a long drawn and a painful exercise. There are several challenges that energy companies face when making contracts with multiple vendors. There is a strong reason why decision makers need to have a practical approach in dealing with the vendors who are a part of the supply chain. The supply may relate to workflow internally, procurement of assets, transactions, and payment schedules. These are all a part of the oil and gas vendor spend analytics that can be measured with specific metrics that matter to the production of crude oil. Invoices related to spending, payments in progress, keeping tabs on service providers and also keeping a check with compliances and quality control of deliveries are all challenges that can be taken head-on with the right data which can be provided by the blockchain ledger. They also verify and take care of the security of the agreements. More than anything else, they also allow the management to know which vendor spends are performing. Those which are not can simplify by re-negotiated or agreements terminated.
Tip: It is not very hard to switch to a driverless vendor supply chain. If the management is able to benefit from cross functions of specialized vendors, they may be able to reduce their departments. Keeping in mind that crude oil prices are volatile, this seems to be a sensible solution to adopt.