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Pioneer Natural Resources

“ Portals and Web Services (A Survivor's Guide)”

Presented by Tom Halbouty, CIO – Pioneer Natural Resources

POSC, November 2005

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Pioneer company snapshot

Enterprise Value

$8 billionProved Reserves(1)

~1 billion barrelsProved Developed

65%Gas % / Oil %

60% / 40%Reserve to Production Ratio

15 yearsSEC PV 10% Value(1)

$9 billion

Enterprise Value

$8 billionProved Reserves(1)

~1 billion barrelsProved Developed

65%Gas % / Oil %

60% / 40%Reserve to Production Ratio

15 yearsSEC PV 10% Value(1)

$9 billionBuenosAires

Anchorage

Dallas

Denver

Calgary

Tunis

CapeTown

Operating Areas

(1) 12/31/04 proved reserves, using $43.33 / $6.19 NYMEX flat prices (88% of reserves audited by Netherland, Sewell and Associates, Inc.)

Chinchaga

Horseshoe Canyon

Raton

Hugoton

PawneeWest Panhandle

Piceance & Uinta

SpraberryGulf of Mexico

North Slope

Alaska

Neuquen Basin

Austral Basin

Argentina

Tunisia

Nigeria

Equatorial Guinea

South Africa

Sable

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Technology pulls a heavy load

• Formal & informal strategy

• Execution model

• Cultural diversity

• Geographic diversity

• Degree of change in the business

• Focus of customer groups

• Diversity of portfolio

• Value of applications

• Picking of the right “battles”

• Scaling (simplicity vs. complexity)

• Credibility through basic services

• Delivery on the big ticket areas

• Practical project & program mgmt.

• Practical governance

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• Pre-Acquisition

• Post-Acquisition

• High exploration

• Geography

• Complexity

• Exploitation mode

• Functionally centric

• Process centric

• Team centric

• Centrally governed (Global)

• Loosely governed (Federated)

• Expanding / rationalizing

SS

WW

NN

EE

Understand where your company is

5Timely, relevant, accurate information is critical to value delivery.

Value

Strategy

People Process Technology

Capital

Information

Execution

Value is achieved through balance

Opportunities

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Employment Cycle (Hire, Develop, Replace)

Sales/Marketing Cycle

Purchase/Supply Cycle

Enterprise Planning & Monitoring Cycle

Asset Cycle (Explore, Exploit, Retire)

Acquisitions/Divestitures Cycle

Fundamental vertical capability must be stable before horizontal processes are optimized.

Inside Firewall•E-Mail•Portals

•Workflow•Infrastructure

Outside Firewall•Extranet

•ASPs•Portals

•Exchanges

Function vs. Process

Pu

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asin

g

Mark

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Facilitie

s

Exp

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tion

Op

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tion

s

Ris

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an

ag

em

en

t

Pla

nn

ing

Hu

man

Resou

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Accou

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Fin

an

ce/T

reasu

ry

Info

rmatio

n

Tech

nolo

gy

Leg

al

Secu

rity

Investo

r Rela

tion

s

En

gin

eerin

g

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Upstream value drivers

Proper identification of the opportunity

Acquisition of the acreage & partners

Successful drilling Profitable commercialization Efficient operations Enhancements to operation

based on opportunities & technology

Understanding when to exit

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Creating value with technology

Value generation through collaboration (3 D visualization centers)

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Toolset

Tool Current Near Term Long term

Portal Plumtree 4.5 WS Plumtree 6.1 Linux

BEA or Documentum

Sharepoint or Portal in ERP or ECM

Search Plumtree Fast Fast

Content Management Plumtree TBD TBD

Business Intelligence Arcplan, Brio, DP Arcplan, Brio, DP TBD

Workflow Unify NXJ

DP

Unify NXJ & Custom Development

TBD

Data Integration ODBC, JDBC Web Services

DP

Web Services

Apps- Web Server BEA, .Net, Apache BEA, .Net, IBM, Apache

TBD

Decision Point Gadget Delivery Web Service data integration with Business Rules

TBD

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Coral Data Access

Source Priority EngineDecisionPoint Map Objects

ArcSDE API

Generic Services

Business Rules OpenSpirit

Application APIODBCJDBCEDI

OSP,

Desktop

Architecture

Portal

• Petroweb• USGS• Geography Network

External

• Well History• PI Production• IHS Web Services• PI 297/298

PIDM

• PNR Proprietary• MMS• OOSA, ELS• Misc.

Finder/Seabed

• IHS Spatial Layers• SPE Spatial Layers• Landworks• Misc.

SDE

• TOW• Aries• OFM Datamart• Misc.

ODS• OpenWorks• GeoFrame• Petra• SMT• Misc.

PDS

Launch reports (Well Summary, PI297/298 etc.) for selected wells on the map

Legacy-Client Server

Web Services- Meta Data

Unify Arcplan Spotfire SearchUnify

Alerts-BAMService & Data changes

BPM

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Ubiquitous search, contextual or map

Federated Meta Repository

• Petroweb• USGS• Geography Network

External• Well History• PI Production• IHS Web Services• PI 297/298•PNR Proprietary

PIDM

•Submittal•Leads and Prospects

Seabed• IHS Spatial Layers• SPE Spatial Layers• Landworks•OOSA• Misc…

SDE

• TOW• Aries• OFM Datamart• Misc…

ODS• OpenWorks• GeoFrame• Petra• SMT• Misc…

PDS

GOAL

Decision Point

DocumentIndex

Decision Point Map based searchGeneric Search Tool

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Challenges

Data Growth – structured & non-structured Legacy data quality Focus on immediate value opportunities (limited time to engage) Market momentum – solutions are emerging & changing rapidly Incomplete tool sets – incomplete suites are emerging for web

services & web delivery Evolving Web Services Standards for items like security Reliability – delivery across a world-wide organization creates

significant challenges ( many “moving parts”) Skills – complex analytical skills are needed to scope, design &

manage composite solutions False promises – tool kits are overselling their capability Work flows & integration – overlaps between ERPs & “smart

suites” are emerging & complex to resolve

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Why standards matter

Portals need foundation for obtaining & presenting information inside & outside the enterprise

Standards for processes create common language & shared vision for the industry

Ability to deploy, upgrade & replace software is enhanced Efficiency & velocity of information exchanged between

interested parties is improved Acquisitions of assets or companies are simplified Quality & consistency of results improve Integration & federation efficiency are improved by allowing

the re-use (i.e. Web Services)

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Barriers to standards

Apathy Lack of real sense of value & what is important Lack of funding Insufficient time & involvement Lack of real cooperation & compromise Too many “cooks in the kitchen” Too much innovation Vendor competition Lack of real visibility & education

Solution will likely require the consolidation of standards bodies, greater participation by all interested parties in the global industry & clear recognition of value from standards

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Closing – broad considerations

Governance must vary radically based on business model Management & communication approach must fit within

cultural boundaries Process will almost always be over designed (lot of effort to

create an elegant simple solution) A vision must be flexible & “deal with the uncertainty of IT” Sourcing is complex & dynamic - driven by the “market” Great agreements are useless if a provider “closes up” No measurement system is better than a “bad one”

(unbalanced) Distraction of the organization between strategy, operational

concerns & rapid response to threats & opportunities requires intensive effort to balance & communicate