A vertiginous price drop and unconvincing track record of operational performance made any prospect of recovery seem unlikely. In early 2015, an operator with upstream assets in various life stages found itself with negative cash flows, declining production and escalating costs. Developing a clean-slate vision of your operating model Please email us at: article lays out a concrete logic that any operator might use to develop a continually evolving operating model and illustrates through real examples the success factors of making this change happen. If you would like information about this content we will be happy to work with you. We strive to provide individuals with disabilities equal access to our website. In fact, they build a continually evolving operating model that achieves higher and more predictable production performance, operating costs for a ‘lower forever’ price environment, and smaller, flexible and more diverse teams that are better suited to the industry’s aging pool of skilled labor. Second, having had one go at improving their operating model, these operators are willing to build on what did not work in round one, and take a second, third, or even fourth look. Feed me oil smalls dots oil driver#While each driver will yield some efficiency gains when used alone, in aggregate, they can more than double the value potential of existing operations. Feed me oil smalls dots oil drivers#These drivers are: their asset strategy physical equipment-in-place work required to operate and maintain that equipment workflows and methods used to conduct that work and the competencies required from the team deployed to do it. What distinguishes the success cases from the also-rans? What sustains their improvement momentum? Through our extensive experience of leading asset turnarounds in Petroleum Asset eXcellence, we observe that upstream operators who sustain their improvement momentum do two things well.įirst, they challenge five interlinked drivers of their operating model in an integrated way (Exhibit 1). Shows digital technologies may improve total cash flows by USD 11 per barrel across the offshore oil and gas value chain, adding USD 300 billion a year by 2025. Why oil and gas companies must act on analytics Anders Brun, Monica Trench, and Thijs Vermaat describe the increase in production potential to be captured by deeper advanced analytic methods. 1 1.ĭata from the Energy Insights Global Operations Benchmark.įurthermore, new technologies and ways of working are resetting top quartile performance levels. Similarly, the highest cost asset on the UKCS has twice the unit operating cost as the median and four times that of the top quartile in the basin. On the UK Continental Shelf (UKCS), for instance, over 40 percentage points separate the lowest production efficiency asset from the top quartile. A marked spread in performance remains between bottom and top quartile operators in every basin.
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