Optimizing Upstream Oil and Gas Production Accenture’S Production Management Solutions for High Performance Introduction

Optimizing upstream oil and gas production Accenture’s Production Management Solutions for High Performance Introduction

The energy industry is under constant pressure in all production environments: conventional or unconventional; onshore or offshore; oil or gas. In the face of rising costs and recent widespread production target misses, exploration and production (E&P) companies are looking to grow reserves and maximize production—while ensuring safe operations and avoiding environmental impact. But imprecise or redundant decisions often result in unnecessary downtime, suboptimal production rates, and increased maintenance and safety issues. This is why ‘production management’ has become a crucial step on an oil and gas company’s journey to high performance.

Accenture’s production management This type of enhanced capability Did you know? offerings address issues faced by many ultimately optimizes the whole asset operators in delivering production life cycle. Whether your production Accenture’s Energy industry group results to their stakeholders—be they managers are trying to bring an oil serves more than 150 oil and gas management, partners or contractors—by field up to a plateau rate or to extend clients globally many of which are taking a holistic and end-to-end view of a field’s life, Accenture can help. the processes and tools needed to deliver in the Oil & Gas Journal 100. high-performing production results. To do this, we focus on six critical steps: model the asset, forecast production, measure production, analyze results, act on insights and monitor the impact of those actions.

1 Unconventional gas Unconventional gas—such as coal-bed methane, shale gas and tight gas—is expected to account for almost half of the increase in global gas production by 20351, with most of the increase coming from the United States, Australia and China. The companies that are leading the way with unconventional assets are not the traditional players, but rather the independent oil companies who saw the opportunities before the supermajors were able to act.

Many of these unconventional gas developments are found in unusual locations, including Australia, Argentina, China and the Ukraine. These locations are posing significant new challenges to the industry especially with regard to logistics, modeling of the asset to derive reliable forecasts and water management. Accenture is actively developing solutions and insights to help E&P companies address these challenges and more.

1 IEA World Energy Outlook 2012, IEA, www.worldenergyoutlook.org. 2 Benefits of production management

Improve information quality Improve decisions • Improve accuracy of forecasts • Develop consistent, reliable production forecasts • Measure production more effectively • Increase collaboration with the Decide quicker workforce by sharing information • Reduce the cycle time for making • Develop a core operating group of decisions specialists in a decision support center • Boost production with optimization • Improve risk management Did you know? Accenture releases a quarterly Focus on value-added Energy Industry Trends Review. processes The publication is available on • Transform the way field operators Accenture.com and reviews the last execute their jobs quarter’s industry outlook, including • Focus on analysis, optimization economics, oil, gas, refining and and maintenance rig activity. • Use tools and technology to predict problems

3 4 Production management services

Based on decades of oil field operational experience, Accenture has developed a full suite of production management services that can be combined, or used on a standalone basis to target specific challenges (see Figure 1). Our solutions support safe, reliable and sustainable operations; reduce costs; and increase operating excellence at the primary production bottlenecks. Accenture can define the scope and objectives to align with a company’s business strategy, setting up definable metrics to measure progress.

Figure 1. Transform upstream production.

• Assess the current state of operations, processes and technologies Strategic • Identify gaps and evaluate operational readiness assessment • Build a roadmap to reach strategic goals

• Determine processes critical to delivering value Operations • Design cross-functionally integrated processes excellence • Deploy standard processes enterprise-wide

• Assess production management capability and identify gaps and weaknesses Production • Deliver critical missing components of an end-to-end integrated solution management • Deploy processes and cyclical workflows to optimize performance • Monitor remedial activity to quantify value delivered against predicted benefits

• Assess, select, and deliver “best in class” application portfolios to Application greenfield assets services • Assess existing application portfolios, identify gaps, and deliver improvements

• Assess upstream data management capabilities Data • Design upstream data management architectures and governance models services • Deliver data loading and cleansing solutions and services

• Design and implement upstream-specific enterprise architectures including Technology digital oilfield support Services • Design and deploy collaborative centers for asset operational support

5 Strategic assessment Our suite of integrated upstream Among our application offerings is the solutions includes production forecasting, innovative greenfield platform. This fast- Before embarking on any optimization hydrocarbon accounting, asset surveillance track program uses Accenture’s extensive journey, an assessment of the current and optimization, loss management, and software tools to quickly work through the state of operations typically provides a much more. Our solutions are based on ‘assess and select’ phases of introducing strong foundation for change. Drawing more than 12 years of oil field operations an application portfolio for a new on interviews with key stakeholders, experience, including the design and upstream asset, and deploying the core we combine company insights with our deployment of digital oil field and applications in an accelerated timeframe. knowledge of leading practices from integrated operations programs. across the industry. Whether challenges Technology services are known or there is a need to identify The solution also covers the full range gaps, our assessment of the company’s of solution development services— Making sure that upstream E&P assets capabilities will result in a roadmap to from a proven delivery methodology; operate as efficiently and effectively help reach strategic goals. to process and technology design, as possible is crucial to driving superior build and implementation; to software business performance. Accenture can We look at process excellence, technology selection and procurement; to help upstream companies improve readiness, skill levels and delivery change management services. operational performance by providing a capability— from a single asset all the way new approach to technology architecture. through to a complete asset portfolio. Data services This approach sweeps away the traditional A strategic assessment brings structure, barriers between siloed vertical Our upstream data management solution external analysis, alignment and business disciplines working in isolation from one is designed to help companies achieve justification to upstream operators, and another. The fragmented structure is more order and reliability in managing provides confidence around investing in replaced with an integrated and holistic the increasingly complex upstream data appropriate solutions. approach to enterprise architecture environment, and then to transform the based on IT solutions that facilitate data into timely and valuable information. Operational excellence common data, standards and processes, This service is based on the Accenture and real-time information flows. Operational excellence is a state in which data management and architecture an upstream company achieves targeted framework, and leverages the upstream Important offerings include an approach business performance from world-class high performance business process model. to enterprise architecture designed operations. Ideally, this performance is specifically for upstream companies–the We work with companies to assess critical achieved within a continuous improvement Accenture integrated oil and gas solutions data gaps, design programs and develop a environment based on the foundation of a platform which is based on a Microsoft systematic implementation. Our approach clearly defined operating model. Upstream Reference Architecture is aligned with the organization, workflows (MURA)-compliant technology platform, At the core of Accenture’s operational and technical landscape. Upstream data originally designed for digital oil field and excellence services are our business process types include both structured (seismic, integrated operations deployments. libraries, leading practice benchmarks well, production, spatial, land and asset) and key performance indicators. Our and unstructured (well/log files, images, global team of experienced practitioners records, sensors and contracts). in upstream operations uses this toolset to define gaps in our clients’ process Application services performance, and develop programs to close gaps effectively and sustainably. Accenture has a broad range of offerings for the development and support Production management of applications: Accenture works with upstream • Application development companies to define the scope, • Application maintenance objectives and metrics for the company's production management processes • Application outsourcing. aligned with the business strategy. This technology consulting offering is We develop innovative solutions that based on our deep understanding of the enable high-performing production applications landscape for the upstream management and support operational industry. The offering includes assets excellence efforts—thereby reducing we have developed from our years of operating costs and increasing production experience helping companies with their while improving safety standards. application portfolios.

6 7 Energy industry experience

The Accenture energy industry group Accenture also has created energy hubs Did you know? serves a wide range of companies in located in energy-centric locations the oil and gas industry, including around the world (see Figure 2). Accenture has created Energy hubs international oil companies (IOCs), The purpose of the hubs is to serve located in energy-centric locations national oil companies (NOCs), as a network to quickly respond to around the world. The purpose of independent oil companies and oil field account team needs, package local service companies. We collaborate with thought leadership, to highlight the hubs is to serve as a network our clients to help them meet competitive emerging trends and test Accenture’s to quickly respond to client needs, challenges and shape solutions to support industry assets for client relevance. package local thought leadership high performance. With experience to highlight emerging trends spanning the entire energy value chain, and test Accenture’s industry including upstream, downstream, oil field services and pipelines, we assets for client relevance. work in more than 20 countries and serve more than 150 clients.

Figure 2. Accenture Energy Hub Network.

Stavanger Amsterdam Copenhagen Aberdeen Munich

Calgary London Paris Rome Lisbon Beijing Tokyo Madrid

Houston Hyderabad Monterrey Manila Abu Dhabi

Bogota Bangalore Kuala Lumpur Lagos

Luanda

Jakarta

Rio de Janeiro Maputo Brisbane

Perth Santiago Buenos Aires Johannesburg

8 Case study: Optimizing production

A North American oil and gas company The oil and gas company’s transformation Did you know? operates thousands of wells in a mature, has been a success. Based on Accenture’s onshore field. The company also has an services and solutions, the company Accenture’s Energy industry active drilling program in mature fields realized the following benefits: group is investing extensively and develops several unconventional fields. in Accenture’s business process • A five percent increase in production The company’s onshore US business initiative. This initiative focuses • A transformed workforce operating unit was a key contributor to the on leading industry processes with a different mindset company’s overall growth strategy. But and a comprehensive model for it had several challenges in the areas • The ability to handle attrition due to the energy industry across all aging demographics of wells and facilities; environment, segments, including industry- health and safety (EH&S) risks; • Significantly reduced EH&S risks. information delivery; workforce; and specific business processes, process unconventional well development. flowcharts, key performance indicator (KPI) frameworks and Accenture helped the company implement capability assessment models. The predictive analytics to move toward a more proactive state, optimize business logical operating model has been processes, and manage communications developed not only for oil and gas, among stakeholders and the workforce but also biofuels, oilfield services, to enable change. oil sands and capital projects.

9 Optimizing production for high performance Many companies are finding it challenging to meet production targets in their base business. Accenture is helping oil and gas clients all over the world to improve their ability to model, forecast, and deliver on their targets by building a faster, coordinated response—across people, processes and technology—and to facilitate optimal production for high performance.

10 Contact us About Accenture Upstream Production Management - Accenture is a global management Global consulting, technology services and outsourcing company, with approximately Martin Leach 261,000 people serving clients in more Managing Director, Upstream Energy than 120 countries. Combining unparalleled +1 713 231 7839 experience, comprehensive capabilities [email protected] across all industries and business functions, North America and extensive research on the world’s Dean Forrester most successful companies, Accenture Managing Director, Upstream Energy collaborates with clients to help them +1 713 751 1028 become high-performance businesses and [email protected] governments. The company generated net revenues of US$27.9 billion for the Europe, Middle East, Africa fiscal year ended Aug. 31, 2012. Its Christophe Bourdeau home page is www.accenture.com. Senior Manager, Upstream Energy +44 0 203 335 2635 [email protected] Asia-Pacific Paul Carthy Managing Director, Upstream Energy +61 408 849 829 [email protected]

Accenture, its logo, and High Performance Delivered are trademarks of Accenture. 13-0709