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How an E&P saved £500k from better scheduling

Tuesday, September 22, 2020

An oil and gas operator added £500k to its annual earnings through better scheduling its drilling program, with the help of software from Actenum.

US oil and gas software company Actenum reports that it enabled an oil and gas company active in the Eagle Ford shale to add £500k to its annual earnings, through being better able to capture all of its program activities and milestones for a drilling program in a single schedule on the software.

The name of the oil and gas company was undisclosed.

Most of the savings came from the automatic optimisation and scenario evaluation capabilities built into the software, Actenum says.

Each separate optimization run is saved as a scenario and compared to other scenarios, enabling the team to evaluate and select the best one at any point.

Problems

In 2015 it became clear to the operator that, as it had grown by acquiring acreage, it had also outgrown its existing spreadsheet-based well delivery scheduling tool.

Besides being cumbersome and unreliable, tracking all of the operational activities and associated timing and costs was taking more and more time as operational changes piled up.

There was no easy way to evaluate schedule scenarios to determine the impact on capital and production of adding or redeploying rigs and frac crews.

Schedulers had to perform multiple iterations of painstaking manual spreadsheet manipulation to analyze outcomes, while trying to synchronize multiple spreadsheets containing all the schedule data.

Master schedules were kept on a central Microsoft SharePoint server. But downloading and opening the spreadsheet-based schedules was very slow, forcing some planners to rely on colleagues for updates. Or worse, they were looking at outdated information, instead of reviewing the latest schedule version.

Because the tool was spreadsheet-based, the schedulers could not rely on automatic quality control over regulatory stipulations or resource allocation.

Frac and drilling schedules were separate from each other, and from construction schedules, so identifying all resource requirements and timing was difficult, leading to schedule conflicts, poor productivity, and overscheduled resources.

Long-term planning presented a significant challenge because considering all constraints, including permit times, material requirements, and facility construction durations, was simply too time-consuming.

Comparing drilling schedule versions was difficult and laborious. And associating important data with schedules, such as type curves for well production, expected vs actual activity costs, and geographic coordinates for wells, pads, and resources, was not feasible.

Scheduling shortcomings didn't just lead to frustration. They were causing serious red ink in the financial department, Actenum says.

Planners determined that when changes were required as a result of a schedule conflict, an average of two extra rig moves were needed, along with other equipment redeployment. At an approximate cost of $60,000 per move, and an average of four major conflicts each year, $480,000 in overruns were adding to expenses annually.

As well as rigs and completion equipment problems, human resources were also not optimally deployed. The team calculated that at least three people per week were wasting time because of poor scheduling, equating to over $30,000 in unnecessary costs annually.

To staunch financial bleeding and make planning and scheduling more reliable, the operator looked for an integrated scheduling solution that would provide scenario capabilities and enable easy collaboration, as well as predict capital and production impacts by accommodating required data items.

Benefits

After an extensive evaluation of potential solutions, the operator determined that Actenum's scheduling and optimization solution provided everything that they were looking for, in a feature-loaded, flexible software tool, Actenum says.

The tool incorporates permitting, approval, construction, facilities, drilling, fracking and production activity timing in one integrated schedule, while honoring resource availability and regulatory constraints.

All data relevant to drilling operations is accommodated, and the easy-to-use interface provides drag-and-drop scheduling features. It provides both optimization and built-in scenario analysis to meet the operator's goals to grow and maximize profitability.

The operator has improved planning by incorporating all relevant pre-drill events into the drilling scheduling process. Scenarios include what is feasible to accomplish over the full well lifecycle, not just drilling.

The team is also able to estimate production forecasts accurately by including type well information.

As well, a companion web-based scheduling visualization and reporting application, DSO/CX, provides semi real-time insight into schedule changes, and ensures that no team member has to wait for updated information or risk looking at an outdated set of data.

Reporting has become self-service. Collaboration across all functional disciplines is now easier since a single source of schedule information is the basis of all drilling program operations.

Looking forward, the software is assisting the planning team in assessing the merits of future acquisitions and new business unit starts. Planners are now able to see in advance whether new business plans are executable and financially advantageous.

Besides the $510,000 earnings improvement, the operator has improved their well delivery scheduling process, and expects to see a reduction in time to first oil as they continue to drill as part of their growth strategy.



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