Schlumberger launches Enterprise Planning Software
Feature Articles, Sep  29  2009 (Digital Energy Journal)

- Schlumberger has made its Merak Enterprise Planning (MEP) software available on commercial release – which can be used for dynamic oil and gas corporate planning

By Saheed Kenku, global portfolio business manager for Merak, Schlumberger

Creating innovative solutions requires vision and the technology to make them happen.

When Schlumberger first envisioned the “Living Business Plan” - a dynamic, event-driven or evergreen corporate planning methodology - it was clear that technology innovation was still required to make it a reality.

The Living Business Plan is now an accessible reality with the release of Merak* Enterprise Planning (MEP), a complete enterprise planning solution based on standardized, commercially available technology that provides a collaborative platform for oil and gas business applications to generate valuable planning information in context.

Merak Enterprise Planning (MEP) enables the Living Business Plan, a dynamic, event-driven or evergreen corporate planning process that allows companies to quickly adapt to changes and addresses challenges in the traditional corporate planning process.

That information is generated by a robust and efficient calculation engine and is captured in an open, accessible, relational format.

For more than two decades, project evaluation solutions and specialist planning applications have been vital components in oil and gas corporate planning.

However, for the most part, oil and gas corporate planning processes remain lengthy, cumbersome, potentially error prone and often ineffective in responding to market and operational realities.

These issues highlighted the need for a robust enterprise solution to facilitate corporate planning and address the key challenges.

An alliance between Schlumberger and Microsoft is making the difference to deliver the solution that enables oil and gas companies to realize the full benefits of a Living Business Plan.

Though MEP has just been released commercially, the solution has already undergone field tests with three oil and gas companies headquartered in different geographic regions - a large integrated oil company, a national oil company and a mid-size independent oil company.

Traditional Planning

Any oil and gas company executive or senior staff member usually has a horror story about tedious, time-consuming planning, forecasting and budgeting activities.

Typically done annually, the workflow involves a significant slowdown to daily operations as the work force gathers information in different formats, from different tools across different disciplines, from technical staff to planners to finance and the board, which is time consuming and often error prone.

The information is (somehow) analyzed, summarised and rolled up to make significant strategic investment decisions for the coming year.

Resulting documents, plans and data are often outdated before the planning process is over. And if market or operational assumptions change drastically - as they did late in 2008 - this process doesn’t allow for companies to easily regroup and re-evaluate.

Needs evergreen data

The Living Business Plan proposes that corporate planning for oil and gas companies can be an ongoing, evergreen process with better results and minimal impact to daily operations.

The key to enabling the Plan is technology that simplifies capture, update and access to planning data, and leverages planning data for maximum value to the company.

Having evergreen data allows businesses to quickly respond to changing economic and operational circumstances. Capturing actual data consistently with the plan allows benchmarking of performance and making necessary adjustments as required.

Gather data automatically

Key problems with traditional planning include the time required to gather and transmit data for analysis, and the interruption it causes to daily operations.

New synchronization technologies allow data from business units and asset teams around the world to be transmitted and updated - either on demand or at pre-scheduled intervals - and stored in a central planning database.

Automation of data gathering minimizes interruption to the work force and improves data accuracy and reliability.

Powerful computers

With the terabytes of technical and business data required for long-range business planning and multiple scenarios, calculations can be intensive and time-consuming. Traditionally oil and gas companies have had to choose between accuracy and performance.

Do you summarise technical and business data to simplify your corporate roll up? Results come quicker, but valuable details are usually lost which, across an entire organization, can potentially skew results.

Now it is possible to preserve accuracy and calculation rigor from the project to the enterprise level through the efficiencies gained by the parallel calculation engine in MEP.

During field testing, the solution reduced the time for a company’s entire enterprise planning roll up from 16 hours to just a little over three hours.

Integrate data streams

The corporate planning process relies heavily on integrating a wide variety of data from disparate data sources.

MEP addresses integration on several levels.

First is the integration of the myriad of data types required and organizing them into their logical relationships. This data includes production forecasts, reserves, economics, financials, general asset information and more.

Second is the integration and resolution of the same type of data from different sources.

While companies strive to standardize on a single solution for specific processes, in reality, different systems still exist (for example, in the specific case of recent acquisitions) for the same information. MEP has technologies to integrate data from the various sources.

Third is the integration of actuals with plan information in the appropriate context, e.g., production, revenues, operating and capital expenditure etc. This capability allows for continued monitoring and adjustments as required.

During field testing, the solution enabled integration of economics data from multiple third-party systems and general asset information from a proprietary system.

Intelligent data cube

All of the planning data that is being automatically gathered and updated is stored in a central database with a data structure specially designed for fast analysis of data in real time.

The OLAP (online analytical processing) Cube allows data to be stored along multiple dimensions unique to the industry, thereby creating and preserving context.

For example, evaluations may be captured with information about their strategic themes, approval stages and for various commodity price scenarios.

Creating and preserving this context makes it possible to ask and answer subsequent questions without having to go back and collect more data. The efficient use of time periods and organizational levels is also important.

For example, many oil and gas companies would expect the first year of the long-range plan to translate into the budget, albeit at a finer level of detail and specified monthly.

Share information

With MEP, advanced visualization technologies can be utilized to mine valuable business insights in multiple dimensions, securely across the enterprise.

Collaboration technologies can also bring significant efficiencies to various aspects of the process.

For example, evaluation and approval of new project proposals can be greatly simplified - an asset manager can designate standard metrics (e.g., production, capital investment, operating costs, cash flow and government share) and specify quality control or approval criteria.

New project proposals are automatically routed to the manager for approval, appearing in the manager’s dashboard, where their performance against the criteria is visually displayed. The manager can then efficiently approve the project proposals, or identify issues and collaborate further to resolve them.

In field testing MEP demonstrated the potential to halve project process time, increase confidence in results (due to reduced economist workload and enabling a stage gate approval process) and reduce a two-month report generation time by at least 75%.

Saheed Kenku

Saheed Kenku is the global portfolio business manager for Merak at Schlumberger Information Solutions. He has over 12 years of experience in the oil and gas industry focused mainly on petroleum economics and corporate planning solutions. He has held various consulting, marketing, business development and management positions with engagements in virtually every geographic region. He holds a masters degree in petroleum engineering from Imperial College, London.

Schlumberger Merak

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