Measuring Information Management in the Oil and Gas E&P Industry The need for change Paul Cleverley [email protected] Flare Solutions October

Measuring Information Management in the Oil and Gas E&P Industry

The need for change

Paul [email protected] SolutionsOctober 2003

Agenda

• Setting the scene

• What areas of IM are being measured today?

• Business drivers for change and the need for improved metrics

• A new approach to measure and manage IM

What is Information Management?

Information Management is a collaborative and integrated approach

to the creation, capture, organisation, preservation, access and use

of knowledge, information and data.

Information Management and Business Management are twisted in a spiral of

inter-dependency

Information Management and Business Management are twisted in a spiral of

inter-dependency

DocumentManagement

Physical RecordsManagement, OffsiteStorage and Library

InformationTechnology/

Systems

Business Process

InformationManagement

Data Management(inc spatial)

IM ServiceProvision by

support departments

IM Activitiesperformed by the

business

Culture and behaviours

IM Framework and standards

Human Resources

Electronic

Improvement

Knowledge Management

Explicit

Tacit

Organisational informationProcesses, best practices

experiences and lessons learnt

Introduction

• What are metrics?• Standard indicators of success• Help us measure the impact of strategies on our business objectives • The second most important thing to a metric is the ability to forecast it

• What Types are there?• Lag and Lead• Quantative, Qualitative• Internal and External Benchmarks

• What can they measure?• Financial/Risk; Process; Learning; Customer

• Why do we need them?• You can’t manage what you can’t measure• Raise the visibility of the important things happening in an organisation from a

number of different perspectives• Enable targets to be set to drive performance improvement• Helps communicate with senior management

What areas of IM are being measured

today?

E&P IM Metrics Industry Survey 2003

BG Group

Canadian Natural Resources (CNR)

ChevronTexaco

ConocoPhillips

Kerr McGee

Maersk Oil & Gas

Marathon Oil

Nexen

PetroCanada

Premier Oil

Santos

Shell

Statoil

Total

43%

50%

7%EuropeanNorth AmericanAustralian

14 International E&P Companies

Survey Results - Summary

• 86% of companies surveyed (12) had no formal process for measuring IM

• 79% of companies surveyed (11) stated there was increased management attention for IM than there was 3 years ago

• There is a lack of consistency within (and between) companies around definitions for collecting metrics

• Only 14% of companies surveyed (2) had a reasonably balanced approach, measuring IM from a number of perspectives. Even this was limited and gained only from user satisfaction questionnaires

• Very simple (or no) tools generally used to collect metrics

• 79% of companies surveyed (11) are going to improve their approach towards measuring IM over the next 12months and are seeking a mandate for change

Current areas of measurement

Number of companies measuring within these areasMeasurement areasIM Perspectives210 543 876 9

IM Support v User Ratio and Cost

Cost of rework/duplication

Total Opex/Capex savings through IM

10

Information quality and completeness

Customer

Info. Accessibility, Manipulation & Retrieval

Information Discovery

Information Sharing and Exchange

Information Integration

Corporate Memory Growth and Usage

Learning & Growth

Flexibility for Change

IM Process Controls (inc security)

Bus Processes

IM Process Efficiency and Effectiveness

IM Process Understanding and Adherence

Risked Exposure Value Mitigated by IM

Financial/Risk/Value

IM Incidents Index

Linking IM to production and Reserve-add

IM RoACE

11

Number of companies measuring within these areasMeasurement areasIM Perspectives210 543 876 9

IM Support v User Ratio and Cost

Cost of rework/duplication

Total Opex/Capex savings through IM

10

Information quality and completeness

Customer

Info. Accessibility, Manipulation & Retrieval

Information Discovery

Information Sharing and Exchange

Information Integration

Corporate Memory Growth and Usage

Learning & Growth

Flexibility for Change

IM Process Controls (inc security)

Bus Processes

IM Process Efficiency and Effectiveness

IM Process Understanding and Adherence

Risked Exposure Value Mitigated by IM

Financial/Risk/Value

IM Incidents Index

Linking IM to production and Reserve-add

IM RoACE

11

General lack of a balanced approach to measuring IMGeneral lack of a balanced approach to measuring IM

Benchmarking IM Measurement practices

Not reallyusing

IM metrics

Collecting &monitoring some

IM metrics

Correct andimprove

Predict andprevent

Business sophistication of reporting and using IM Metrics(which best characterises company approach)

Bal

ance

d n

atu

re o

f IM

met

rics

(ext

ent

to

whi

ch I

M is

me

as

ure

d fr

om

an

um

ber

of

diff

ere

nt p

ers

pect

ive

s)

Me

diu

mH

igh

Lo

w

A

BC

D

G

F

E

HI

JK

M

LN

NorthAmerican E&P

Companies

European andAustralasian

E&P Companies

Key

Huge potential to improve practices in this area to derive business benefitHuge potential to improve practices in this area to derive business benefit

Selected examples from published literature

and surveys

Examples - IM user satisfaction and data quality

According to a survey of 14 international E&P Companies (Flare 2001), 57% (8) performing

some type of IM Survey and 57% (8) performing some type of data quality checking using scripts

According to a survey of 14 international E&P Companies (Flare 2001), 57% (8) performing

some type of IM Survey and 57% (8) performing some type of data quality checking using scripts

Data Management Assessment Form

Customer:

Assessor:

Data Type:

RangeAccuracy 0 = none … 5 = all 3 3 15.00%Clarity 0 = no … 1 = yes 3 0 0.00%Completeness 0 = none … 5 = all 2 2 6.67%Consistency 0 = not … 5 = highly 2 3 10.00%Timeliness 0 = not … 5 = highly 2 3 10.00%

Total Quality 41.67%

Accessibility 0 = no … 5 = highly 3 3 12.86%0 = no … 1 = yes 3 1 21.43%0 = no … 1 = yes 3 1 21.43%

Master Source 0 = no … 1 = yes 2 1 14.29%Recoverability 0 = no … 1 = yes 1 1 7.14%Security 0 = no … 1 = yes 2 1 14.29%

Total Accessibility 91.43%

Communication 0 = no … 1 = yes 3 0 0.00%0 = no … 1 = yes 3 0 0.00%0 = no … 1 = yes 3 0 0.00%0 = no … 1 = yes 3 0 0.00%0 = no … 1 = yes 3 0 0.00%0 = no … 1 = yes 3 0 0.00%0 = no … 1 = yes 3 0 0.00%0 = no … 1 = yes 3 0 0.00%0 = no … 1 = yes 3 0 0.00%

Total DM System 0.00%

Attitudes & Behaviours 0 = poor … 5 = excellent 3 3 11.25%Costs 0 = none … 5 = high 1 2 2.50%Criticality & Relevance 0 = low … 5 = high 3 4 15.00%

0 = no … 1 = yes 2 1 12.50%0 = no … 1 = yes 2 1 12.50%

Resources 0 = none … 5 = sufficient 3 2 7.50%Value 0 = none … 5 = high 2 4 10.00%

Total Miscellaneous 71.25%

The Users

An Assessor

J oined and Calculated Curves (Geoscene/Recall)

What is the value of this data type to your business processes?

Are there sufficient resources in place to manage this data type effectively?

Have data management standards and conventions been defined for this data type?

Are these data management standards and conventions being adhered to?

What are the attitudes and behaviours towards managing this data type?

How much would it cost to purchase /create data values for this type?

Have data management procedures been defined for this data type?

Life Expectancy

How critical or relevant is this data type to your business processes?

I s there a retention schedule in place for this data type?

I s the retention schedule being used?

Are these data management procedures being used?

Have data management roles and responsibilities been defined for this data type?

Have these data management roles and responsibilities been implemented?

I s access to the data values restricted to those who are entitled to use them?

I s there regular communication with customers about this data type?

I s there an agreed system of data management indicators for this data type?

Are these data management indicators being used?

Has a Corporate store been identified for this data type?

I s this Corporate store being used actively to store this data type?

I s there a clearly identified master source or producer for this data type?

Are backup procedures in place for this data type?

Import

ance

Score

Rela

tive

Perc

enta

ge

Corporate Store

Are the data values correct and within the agreed uncertainty boundaries?

I s there an accepted definition for this data type?

How many of the data types that should be present are actually present?

How compatible are data values for this data type from different sources?

Are the data values sufficiently up-to-date and available when needed?

Are the data values available when and where needed?

Performance Indicators

Procedures

Roles & Responsibilities

Standards & Conventions

Quality

Accessib

ilit

yD

ata

Managem

ent

Syste

mM

iscellaneous

Know ledge

Data

Information

FrequencyNever Always

0.0 0.2 0.4 0.6 0.8 1.0

All 36

Harstad 5

Trondheim 11

Bergen 4

Stavanger 16

All 36

Harstad 5

Trondheim 11

Bergen 4

Stavanger 16

58.0%

54.0%

20.9%

78.2%

75.0%

21.3%

27.5%

54.1%

Do you always locate ALL data you need?

How often do you work with incomplete data because you did not have time to carry on looking?

Binomial test, related to size of populationTest of each site is different within 95% confidence level

64.3%

28.5%

Significant different, greater or lessRepresented by “all”

55.0% 73.5%

20.4% 36.5%

95% confidence lever for Mean (actually My – the through population’s mean)

Reference: Shell Expro

Reference: Statoil

IM User Questionnaires

1. Automated database integrity/quality metrics (SQL Type)

2. Monitoring disk space and application usage (Scripts)

Automated Data Quality Tools

Examples - Return on Investment justification models

• Back-office cycle time reductions• Loading seismic/log data• Reducing IM cycle times, accelerating production (increase revenue)

• User focused cycle time reductions• Time users spend looking for/reformatting information• Reducing interpretation cycle time, accelerating production

• Better decisions• Faster more accurate information

• Storage/retrieval cost reduction• Loading into on-line systems• Removal of duplicates

• IT Infrastructure cost reductions• Application Service Provision models

• Resource cost reduction• Moving of staff to higher value activities• Redution in technical staff through better IM

Organisational Culture

Source: Tanner 2003 (30 E&P Companies)

55% of respondents thought their E&P Company had a restrictive culture55% of respondents thought their E&P Company had a restrictive culture

E&P Data Management Maturity Model

1

2

3

4

5

Level

Base - capable people, heroic efforts, IM not treated as a corporate responsibility

Managed - individuals develop and follow processes useful for them. Un-integrated point solutions

Corporate Competency - standard processes, capabilities institutionalised

Predictable Risk - statistically stable processes, ability to routinely reduce risk

Fully optimised - emphasis on risk overshadows pure productivity

According to D’Angelo AAPG Explorer 2000 “Most North American companies are at level 2,

elsewhere in the world companies are mainly level 1”

According to D’Angelo AAPG Explorer 2000 “Most North American companies are at level 2,

elsewhere in the world companies are mainly level 1”

Examples - industry IT and IM surveys

0

20

40

60

80

100

120

140

0 100 200 300 400

Number of Technical Users

Nu

mb

er o

f IM

re

late

d s

taff

Oil Company

Average User/Support ratio = 3:1Average User/Support ratio = 3:1

Flare 2001 (E&P Technical IM Survey)

Ave Time spent looking for info = 20%

Ave Time spent re-working = 13%

Rose (2001) IT E&P Benchmarking Survey

Average $/Desktop in E&P = $14KAverage $/Desktop in E&P = $14K

IT TCO per Technical User = $100K+DM (Pohlman 2000)

IT TCO per Technical User = $100K (Landmark 2003)

Significant evidence from both inside and outside E&P Industry to suggest there

is no linkage between IT and profitability

Significant evidence from both inside and outside E&P Industry to suggest there

is no linkage between IT and profitability

Strassman 1997 - A study of 200 US Industrial Corporations

Current Situation

The measurement of IM is not recognised as

being part of a company’s E&P Business Model

The measurement of IM is not recognised as

being part of a company’s E&P Business Model

Business Management do not understand the

value of their corporate ‘IM system’ seen

primarily as an overhead cost

Business Management do not understand the

value of their corporate ‘IM system’ seen

primarily as an overhead cost

Business and Executive Management do not treat

IM as a corporate risk domain

Business and Executive Management do not treat

IM as a corporate risk domain

User satisfaction surveys and database quality

metrics rule

User satisfaction surveys and database quality

metrics rule

Lack of understanding between IM and IT and

between IM ‘the function’ and IM ‘the department’

Lack of understanding between IM and IT and

between IM ‘the function’ and IM ‘the department’

Observations

Drivers for change

Globalisation,

distributed teams

working together

Globalisation,

distributed teams

working together

Group standardisation

Minimum standards

Accountability

Compliance

Group standardisation

Minimum standards

Accountability

Compliance

Rise of knowledge as a key economic resource

Rise of knowledge as a key economic resource

Better investment decision

Better investment decision

Cost reductionCost reduction

Drivers for

change

A new approach to measure IM:

Selected examples from industry sponsored project

(combining survey findings, literature review and new thinking)

Introducing the E&P IM Measurement Model

Implement

(2) Q

ua

lity o

f IM F

ram

ew

ork

,c

om

plia

nc

e &

cu

lture

Corporate

Com

plianceC

orporateC

ompliance

IMF

ramew

orkC

ulture andB

ehavioursC

ulture andB

ehaviours

True

Investment in

E&P Information

Management

(1) IM Investmentstake

(3) E

ffec

tive

ne

ss

of th

e IM

sy

ste

mInform

ationQ

uality &C

ompleteness

Information

Quality &

Com

pleteness

User

Satisfaction

User

Satisfaction

IM

Architecture

Information

Overload

Operate

IM cost

savingsV

alue Creation

and Risk R

eduction

Enable

Aspirational

Objectives

(4) R

etu

rn o

n In

ve

stm

en

t (RO

I)

Benefit

Justify

Can industry benchmark at any level in the model - some more appropriate that othersCan industry benchmark at any level in the model - some more appropriate that others

The goal: A balanced IM Scorecard

PoorLevel o f compliance11

Activity based IM costing (Strassman, modified)$52.4 MillionTotal annual cost of IM (Activity based)1

PoorInformation Overload Rating16

Industry Benchmark

Benchmarks exist for IT spent but not for IM value or effectiveness today

50 percentileOveral industry ranking17

$15MillionResidual IM Risk Exposure7

Applies a consistent treatment to al l forms of information, data, documents, records & process

Poor Informa tion Quality & Completeness14

For the first time, explicitly measures how well the IM system is architected ra ther than by perception. Differentiates 2 fundamentally different types of information.

AverageIM Architecture Quality13

Includes finding, accessing, i ntegrating and sharing information. Drill down available for specific score.

AverageEnd-user perception 12

Customer

Value

AverageInforma tion Accessibility15

AverageIM Culture11

ExcellentQuality of IM framework10

IM Processes and culture

Measures the abili ty of an IM system to support corporate aspirational objectives

PoorSupport to aspiration objecti ves Index-learning organisation

9

Promotes the IM System as an IC Item1.245IM Intellectual Capital (IC) Rating8

Treats IM as a corporate risk domain. Drill down to risks in particular functions e.g. exploration

$205MillionIM Risk Exposure being mitigated6

1:3IM Support Staff / No of end-users5

Excludes some technology which is not IM related1.54Cost of IM / Technology IM cost4

22.3%Cost of IM / profit3

$45,000Cost of IM per employee2

Investment cost

Key Approach Differences to traditional methodsScore TrendIM AreaNo

Information Management Scorecard

PoorLevel o f compliance11

Activity based IM costing (Strassman, modified)$52.4 MillionTotal annual cost of IM (Activity based)1

PoorInformation Overload Rating16

Industry Benchmark

Benchmarks exist for IT spent but not for IM value or effectiveness today

50 percentileOveral industry ranking17

$15MillionResidual IM Risk Exposure7

Applies a consistent treatment to al l forms of information, data, documents, records & process

Poor Informa tion Quality & Completeness14

For the first time, explicitly measures how well the IM system is architected ra ther than by perception. Differentiates 2 fundamentally different types of information.

AverageIM Architecture Quality13

Includes finding, accessing, i ntegrating and sharing information. Drill down available for specific score.

AverageEnd-user perception 12

Customer

Value

AverageInforma tion Accessibility15

AverageIM Culture11

ExcellentQuality of IM framework10

IM Processes and culture

Measures the abili ty of an IM system to support corporate aspirational objectives

PoorSupport to aspiration objecti ves Index-learning organisation

9

Promotes the IM System as an IC Item1.245IM Intellectual Capital (IC) Rating8

Treats IM as a corporate risk domain. Drill down to risks in particular functions e.g. exploration

$205MillionIM Risk Exposure being mitigated6

1:3IM Support Staff / No of end-users5

Excludes some technology which is not IM related1.54Cost of IM / Technology IM cost4

22.3%Cost of IM / profit3

$45,000Cost of IM per employee2

Investment cost

Key Approach Differences to traditional methodsScore TrendIM AreaNo

Information Management Scorecard

IM Investment Stake

• Activity Based Costing (ABC) approach, modified from Strassman 97

• Include cost of all IM activities, regardless of where they occur in the business

• Do not associate all IT costs with IM (some are clearly process based e.g. seismic interpretation, reservoir simulation)

• Include ratio’s (IM staff to end users)

(5) Industry benchmarking - how we compare (direct comparison and trends)

Implement

IM co

st sa

vings

Value C

reationand R

isk Reduction

Enab

leA

spirational

Obje

ctives

(4) R

etu

rn o

n In

ve

stm

en

t (RO

I)

(2) Q

ua

lity o

f IM F

ram

ew

ork

,c

om

plia

nc

e &

cu

lture

Corpo

rateC

omplia

nce

Corpo

rateC

omplia

nce

IMF

rame

wo

rkC

ulture and

Beha

viours

Cultu

re andB

ehaviou

rs

(3) E

ffec

tive

ne

ss

of th

e IM

sy

ste

mInform

ationQ

uality &C

omp

leteness

Information

Quality &

Com

pleteness

User

Satis

factionU

serS

atisfaction

IM

Arch

itecture

Information

Overload

Investmentin Data

Management

Investmentin traditionalE&P Data

Management

Investmentin Upstream IT

(pure technology)

Investment inE&P Information

Management


Operate Benefit

Justify

(6) Technologies for automating, collecting, presenting and anal ysing metrics

Does Executive Management understand that by increasing investment in IM services,

there is potential to reduce the overall corporate spend on IM?

Does Executive Management understand that by increasing investment in IM services,

there is potential to reduce the overall corporate spend on IM?

Quality of IM Framework, Compliance & Culture

• Measure against high-level industry best practice IM Framework Model for a points score

• Measure compliance of the Framework Model for a points score

• Use a simple 3-level model for culture (Open, Neutral, Restrictive)

Adopting quantifiable metrics can support consultancy/audit judgements, enable targets to be

set and improvements seen. Traffic lights used to summarise points scores

Adopting quantifiable metrics can support consultancy/audit judgements, enable targets to be

set and improvements seen. Traffic lights used to summarise points scores


Implement

IM cost

savings

Value C

reationand R

isk Reduction

Enable

Aspirational

Objectives

(4) R

etu

rn o

n In

ve

stm

en

t (RO

I)

(2) Q

ua

lity o

f IM F

ram

ew

ork

,c

om

plia

nc

e &

cu

lture

Corpo

rateC

ompliance

Corpo

rateC

ompliance

IMF

rame

wo

rkC

ulture andB

ehaviou

rsC

ulture andB

ehaviou

rs

(3) E

ffec

tive

ne

ss

of th

e IM

sy

ste

mInform

ationQ

uality &C

omp

leteness

Information

Quality &

Com

pleteness

User

Satisfaction

User

Satisfaction

IM

Architecture

Information

Overload

Investmentin Data

Management


Management


(pure technology)


Management


Operate Benefit

Justify


74

87

0

0

IM Framework Quality

IM Compliance

20

IM Culture/Behaviours

2003Indicator

2003Indicator

2003Indicator

2004Target

2004Target

2004Target

Effectiveness of IM System

• Industry Best Practice IM User Questionnaire

• IM Architecture Test

• Information Quality & Completeness• Quality based on US Defense Categorisation

• Information Overload (Based on email)


Implement

IM cost

savings

Value C

reationand R

isk Reduction

Enable

Aspirational

Objectives

(4) Retu

rn o

n In

vestmen

t (RO

I)

(2) Qu

ality of IM

Fram

ewo

rk,co

mp

lian

ce & cu

lture

Corpo

rateC

ompliance

Corpo

rateC

ompliance

IMF

rame

wo

rkC

ulture andB

ehaviou

rsC

ulture andB

ehaviou

rs

(3) Effectiven

esso

f the IM

systemInform

ationQ

uality &C

omp

leteness

Information

Quality &

Com

pleteness

User

Satisfaction

User

Satisfaction

IM

Architecture

Information

Overload

Investmentin Data

Management


Management


(pure technology)


Management


Operate Benefit

Justify


Assessing user perceptions

A. Average time spent on information activities (%) 1 Looking for information __% Chance not found __% 2 Information Quality Control __% Comment:__________ 3 Loading data __% Comment:__________ 4 Reformatting/Manipulating __% Comment:__________ 5 Ordering/Accessing information once found __% Comment:__________ 6 Publishing/Archiving final interpretations and analyses __% Comment:__________ 7 Reworking information that exists but cannot find it __% Comment:__________ 8 Time spent in meetings __% Unnecessary time _% B. Finding, accessing and integrating information (x in box) 1.V.Easy 2 3 4 5V.Hard 9 How “easy” is it to find information you need? 10 How “easy” is to find knowledge about the data? 11 How “easy” is it to access/order/retrieve info once found? 12 How “easy” is it to access info from a single machine? 13 How “easy” is it to access info at home/other offices? 14 How “easy” is it to transfer data from one application to

another in the same discipline?

15 How “easy” is it to transfer data from one application to another application in different disciplines

16 How “easy” is it to integrate information spatially? 17 How “easy” is it to view what information is available in

context regardless of whether it is digital data, documents, hardcopy or physical or about people, process or app?

C. Knowledge capture, learning and sharing (place x in box) Always 1 2 3 4 5Never 18 Final interpretations (documents, and info in databases)

are always published/archived so others can use them

19 I/We perform peer-assists & lessons learnt processes 20 Lessons learnt are documented and published 21 I/We participate in on-line discussion forums, communities

of practice and publish ad-hoc thoughts and insights into the corporate memory

22 We check the corporate memory (index/data/doc stores etc) for what’s been done, before starting a project

23 We repeat successes and avoid mistakes

24 I feel overloaded with information D. Quality, completeness and currency of information (x in box)

Excellent 80-100%

2 3 4 V. Poor <20%

25 Accuracy of information in our corporate stores is: 26 Completeness of our corporate stores is: 27 Timeliness of information from operations is: 28 The management of multiple versions and duplicates is: E. Project working and collaboration (place x in box) 29 The ease with which I can share project related

information (data, documents, emails) internally is:

30 And the ease with which I can share externally is: F. Impact on the business (successes and risks) 31 How many examples can you give where good IM has

contributed to business improvmt/success in past 1 yr? ____No List examples:

32 How many examples can you give where poor IM has contributed to poor business performance in past 1 year?

____No List examples:

No Rating Definition 1 V. Easy Little knowledge required to operate intuitive systems and structures;

new starters would find it easy with light instruction. Can do it myself quickly, few barriers between myself and information - do not need to

Levels such as ‘Very Easy’ to ‘Very Hard’

can be characterised by a series of statements

to enable people to make an informed assessment.

Similarly to how an essay may be marked by an examiner

they typically have 5 levels and examine a number of

attributes.

Architecture Test - example

Find all the relevant information products for the

following:

No. Of interfaces (A, B, C..)

Time (secs)

Mouse clicks

Type I – routine E&P work products 1 Well Header Data (data) 2 Joined well logs (data and plots) 3 Well deviation and computed well path (data and plot) 4 Formation tops for a well 5 Reconciled Field Production Volumes (data and plot) 6 Current Base-Map 7 RFT information (data and plot) 8 Well-bore schematics (diagram) 9 Core (data, plots, reports, photographs, physical) 10 Daily Drilling Reports (reports) 11 Top structure map (grid, map) 12 Composite (Completion) Log (plot) 13 Interpreted seismic horizons (data, reports) 14 License Meeting Minutes (TCM) (report) 15 Lessons Learnt (Report) 16 Well Proposal (report) Type II – non-routine information – is it codified? 17 License partner contact information 18 Departmental organisational chart 19 Well proposal template 20 Log curve naming standards 21 Depth conversion best practice 22 Who was involved in the well data acquisition? 23 Have all well regulatory obligations been fulfil led? 24 Who is the company expert on basin modelling apps? 25 What do people think of this pressure study? 26 Where are we in the development programme for

these assets?

27 What do we know about horizontal drilling? 28 What applications can I use for this process?

Using automated intelligent tools for metrics

SyntheticRFT

Well A10

Well A9

Well A8

Well A7

Well A6

Well A5

Well A4

Well A3

Well A2

Well A1

Wellbore

Diagram

Comp Log Plot

CoresWell Picks

Joined Logs

Well Header

SyntheticRFT

Well A10

Well A9

Well A8

Well A7

Well A6

Well A5

Well A4

Well A3

Well A2

Well A1

Wellbore

Diagram

Comp Log Plot

CoresWell Picks

Joined Logs

Well Header

52.345

Lat

18.342

Long

Unknown

Datum

A6

Well name

FlareDry P&A12000-25

etcOperatorStatusTDKBE

52.345

Lat

18.342

Long

Unknown

Datum

A6

Well name

FlareDry P&A12000-25

etcOperatorStatusTDKBE

No data Looks okMinor issues

Serious issues

Key

Select assets

Show by Accuracy

Show by Completeness

Show by Consistency

Show byTimeliness

Show by Duplication

Information Quality and Completeness Metric Tool

Drill Down

Show by Hyperbolic View

Selectinformation types

SelectBy process

Show by usageand volumes

Show by Validity

Scope

Data Quality metric

Display

On-linefeedbackavailable

User feedback - quality assessments

Report: What geoscientists should know about deviation surveys (3)

000Negative Feedback

000Neutral Feedback

012Positive Feedback

>6 MonthsLast 6 MonthsLast Month

000Negative Feedback

000Neutral Feedback

012Positive Feedback

>6 MonthsLast 6 MonthsLast Month

pcleverley “Extremely useful, found out some really important stuff on how deviation surveys can rotateif you get the UTM zone wrong”mwilliams ”Written for geoscientists, well worth a read I can recommend it”rjones ”Helped me identify some problems I had with my wells, some of the top reservoir picks were in thewrong x/y space. A must read for all geoscientists especially those working in international acreage”

Items with a positive feedback from 3 consumers

Items with a positive feedback from 6 consumers

Items with a positive feedback from 10 or more consumers

Avoid the traditional bucket approach for data and documents - just putting items in and taking

them out. Learning from Amazon.comTM and EbayTM, making the corporate IM system a

“living” system which builds the organisational memory and generates new knowledge.

Avoid the traditional bucket approach for data and documents - just putting items in and taking

them out. Learning from Amazon.comTM and EbayTM, making the corporate IM system a

“living” system which builds the organisational memory and generates new knowledge.

Return on Investment (ROI)

• Enable Corporate Aspirations

• Risk Reduction

• Intellectual Capital

• IM Cost Reduction


Implement

IM cost

savings

Value C

reationand R

isk Reduction

Enable

Aspirational

Objectives

(4) R

etu

rn o

n In

ve

stm

en

t (RO

I)

(2) Q

ua

lity o

f IM F

ram

ew

ork

,c

om

plia

nc

e &

cu

lture

Corpo

rateC

ompliance

Corpo

rateC

ompliance

IMF

rame

wo

rkC

ulture andB

ehaviou

rsC

ulture andB

ehaviou

rs

(3) E

ffec

tive

ne

ss

of th

e IM

sy

ste

mInform

ationQ

uality &C

omp

leteness

Information

Quality &

Com

pleteness

User

Satisfaction

User

Satisfaction

IM

Architecture

Information

Overload

Investmentin Data

Management


Management


(pure technology)


Management


Operate Benefit

Justify


Return on Investment (ROI) may be a combination of benefits, moving away from the single

number to reflect intangible benefits of IM projects and operations

Return on Investment (ROI) may be a combination of benefits, moving away from the single

number to reflect intangible benefits of IM projects and operations

A Risk Based Approach

Low Medium High

Low

Med

ium

Hig

h

Likelihood of occurrence

Bus

ines

s Im

pact

(Fin

anci

al/N

on F

inan

cial

)

Health, Safety andEnvironment

£100M

£10M

Human ResourcesAbility to attract new

staff

ContractorPerformance

Staff Competency

Legal Contracts

Portfolio/concentration

Technical

Country/Political

Regulatory

Commercial/Economic

Does your company treat IM as a key risk domain? Does it have an IM Framework to support it?

Have you quantified your existing exposure to IM?

Does your company treat IM as a key risk domain? Does it have an IM Framework to support it?

Have you quantified your existing exposure to IM?


Low Medium High

Low

Med

ium

Hig

h


Bus

ines

s Im

pact

(Fin

anci

al/N

on F

inan

cial

)


£100M

£10M


staff


Staff Competency

Legal Contracts


Technical

Country/Political

Regulatory

Commercial/Economic

Lack of effectiveInformation Management

What sort of corporate exposure do you have in terms of IM Risk?What sort of corporate exposure do you have in terms of IM Risk?


Low Medium High

Low

Med

ium

Hig

h


Bus

ines

s Im

pact

(Fin

anci

al/N

on F

inan

cial

)


£100M

£10M


staff


Staff Competency

Legal Contracts


Technical

Country/Political

Regulatory

Commercial/Economic


Perhaps its current level based on existing controls and business requirements is acceptable?Perhaps its current level based on existing controls and business requirements is acceptable?


Low Medium High

Low

Med

ium

Hig

h


Bus

ines

s Im

pact

(Fin

anci

al/N

on F

inan

cial

)


£100M

£10M


staff


Staff Competency

Legal Contracts


Technical

Country/Political

Regulatory

Commercial/Economic


Perhaps it requires improvement?Perhaps it requires improvement?


Low Medium High

Low

Med

ium

Hig

h


Bus

ines

s Im

pact

(Fin

anci

al/N

on F

inan

cial

)


£100M

£10M


staff


Staff Competency

Legal Contracts


Technical

Country/Political

Regulatory

Commercial/EconomicLack of effective

Information Management

Or is it unacceptable?Or is it unacceptable?

Types of Generic IM Risk

IM Risk Supporting Metrics described in this report

A. Behaviours 1 Sub-optimal culture for sharing information and collaborating METRIC#2C 2 IM not recognised by mgmt as a strategic resource or

corporate risk domain METRIC#2A

B. IM Framework 3 Standard and processes not well defined METRIC#2A 4 Standards and processes not adhered to, roles and

accountabilities not accepted METRIC#2B

C. Finding information 5 Difficult to find key E&P information METRIC#3A, 3B, 6 Difficult to find ‘knowledge’ related or process info. METRIC#3A, 3C

D. IM Technology 7 Having overly complex/difficult IM tools METRIC#3A, 3B, 3C 8 Not having the right IM tools METRIC#3A 9 Not having the right training for IM tools METRIC#3A

E. Information Usage 10 Poor info. incomplete, wrong version, out of date METRIC#3D,3E,3F,3G,3H 11 Frequency of information too slow Interview question 12 Duplication of critical information METRIC#3A 13 Info. Found but not in a usable format METRIC#3A, 3B, 3C 14 Use of spreadsheets for critical info. Interview question 15 Unable to integrate information effectively METRIC#3A 16 Poor information accessibility METRIC#3A 17 Information Overload METRIC#3A, 3I, 3J, 3K

F. Corporate Memory Loss 18 Not preserving all the information work products we should METRIC#3A, 3G 19 Not capturing the story about the numbers, who to contact,

what people think METRIC#3A, 3C, 3F, 3H

G. Information Security 20 Accidental/malicious unauthorised access Interview question

H. IM Investment/ Resources 21 Insufficient/too much IM investment METRIC#1A, 1B, 1C, 1D 22 Not taking advantage of latest IM cost saving techniques METRIC#4A, 4E

I. Intellectual Capital 23 Not realising the potential or value of the information and

information management system we have. METRIC#4E

J. IM Risk Exposure 24 Unacceptable business risk through poor IM METRIC#4B, 4C


Low Medium High

Low

Med

ium

Hig

h


Bus

ines

s Im

pact

(Fin

anci

al/N

on F

inan

cial

)

Not learning as effectivelyas we could

£10M

£100K

Operations reportingapplication not meetingbusiness expectations

Difficult to accessproduction and finance

systems

Knowledge loss. Corporatememory is incomplete, lack

of auditability andtransparency of info.

Poor quality andincomplete subsurface

data in Subsurface Database

Unable to share the processdocs and information within

the virtual team

Email overload

IT Infrastructure not meetingbusiness expectations

Lack off awareness andsub-optimal behaviours

in IM

Lack of poorprocedures around

deviation data insome areas

Not fulfilling regulatory andpartner reporting obligations

for well data

IM Risk profiles should be co-created between the business and Im functions.

An E&P company recently found its Corporate IM Risk exposure equated to $150Million (Risked)

IM Risk profiles should be co-created between the business and Im functions.

An E&P company recently found its Corporate IM Risk exposure equated to $150Million (Risked)

A Risk Based Approach - IM Risk Profile

Low Medium High

Low

Med

ium

Hig

h


Bus

ines

s Im

pact

(Fin

anci

al/N

on F

inan

cial

)

Not learning as effectivelyas we could

£10M

£100K

Operations reportingapplication not meetingbusiness expectations

Difficult to accessproduction and finance

systems

Knowledge loss. Corporatememory is incomplete, lack

of auditability andtransparency of info.

Poor quality andincomplete subsurface

data in SubsurfaceDatabases

Unable to share the processdocs and information within

the virtual team

IT Infrastructure not meetingbusiness expectations

Lack off awareness andsub-optimal behaviours

in IM

Lack off poorprocedures around

deviation data insome areas

Not fulfilling regulatory andpartner reporting obligations

for well data

Email overload

..when addressed this can be significantly reduced and quantified. The value is the level of

risk reduced, which can be in the order of $Millions, but is not a traditional balance sheet saving

..when addressed this can be significantly reduced and quantified. The value is the level of

risk reduced, which can be in the order of $Millions, but is not a traditional balance sheet saving

Integrating IM projects into portfolio selection

0 5 10 15 20

Project Cost/Benefit Ratio (CBR) (£)

IM Risk ReductionActivity

Palinspastic ReconstructionStudy

Acquire new geophysical software

Reprocess seismic data

Bring in expertise of play

Prospect Generation with simulated CBR’s for a fictitious play scenario

0 5 10 15 20

Project Cost/Benefit Ratio (CBR) (£)

IM Risk ReductionActivity

Perform a workover

Implementnew valve technology

Fracturereservoir

Field Operations with simulatedCBR’s for a fictitious field scenario

New shift patterns

..a significant number of E&P activities are about reducing risk and uncertainty. Whilst

many IM activities may not be revenue generators, they can significantly reduce risk..

..a significant number of E&P activities are about reducing risk and uncertainty. Whilst

many IM activities may not be revenue generators, they can significantly reduce risk..

Simplified examples to show concept….

Typical Intellectual Capital Elements

Typical Intellectual Capital Elements (Examples)Typical Intellectual Capital Elements (Examples)

Business Strategy

Processes

Business Strategy

Processes

Concept

Formulation

Concept

Formulation

Individual

Differences

Individual

Differences

Management

Enhancement

Processes

Management

Enhancement

ProcessesOrganisational

Structure

Organisational

Structure

Team Dynamics and

Culture

Team Dynamics and

CultureTeam

Psychological

Processes

Team

Psychological

Processes

Technical

Knowledge

Technical

Knowledge

Information

Management

System

Information

Management

System

Intellectual Capital Assessment (ICA)

• Treat the company IM System as an intellectual capital item

• Implement an assessment process to develop the IC Inventory for the IM System

• Level of Knowledge (LoK)• Value Added (VA)• Need to Share More (NTSM)

• Provide IC indicators ($ optional) and also identify potential intellectual capital items

The company information management system is an intellectual capital item

used to derive wealth. Measure it….manage it.

The company information management system is an intellectual capital item

used to derive wealth. Measure it….manage it.

Link between Good IM Practices and Business Success

• Links between companies which adopted decision analysis best practices (but not technologies) and business performance have already been made

• All things being equal, it seems logical that companies who adopt an use IM best practices (not technology) will also perform better than those that do not

Arthur D. Little Carragher AAPG 2000

Can we definitively prove it?Can we definitively prove it?

Summary - Adopting a new approach

Use an activity based costing approach for

measuring and understanding IM investment stake.

Use an activity based costing approach for

measuring and understanding IM investment stake.

Measure Quality of IM

Framework against best

practice models. Treat IM

as a partnership

Measure Quality of IM

Framework against best

practice models. Treat IM

as a partnership

Measure effectiveness of

IM System using real-time

tests and technologies

Measure effectiveness of

IM System using real-time

tests and technologies

Measure value of IM System using an


Approach

Measure value of IM System using an


Approach

Treat IM as a corporate risk domain and measure

how it can enable corporate aspirations

Treat IM as a corporate risk domain and measure

how it can enable corporate aspirations

Measure IM from a number of different perspectives and use a number of different

mechanisms. Adopt on a priority basis - “you don’t need to boil the ocean”

Measure IM from a number of different perspectives and use a number of different

mechanisms. Adopt on a priority basis - “you don’t need to boil the ocean”

A new

approach:

IM Scorecard

Thankyou for listening

Any Questions?

“To manage a business well, is to manage the future;

and to the manage the future, is to manage information”Marion Harper, HBS

Documents

Measuring Information Management in the Oil and Gas E&P Industry The need for change Paul Cleverley [email protected] Flare Solutions October