With the depleting oil reserves, it is becoming tougher for the Oil companies to extract profits. The finance controllers have their task cut out while managing projects, of such magnitude. The challenge only multiplies itself by many folds, if they are to manage multiple projects at a time. However, thanks to the availability of advanced oil and gas production software, that can help identify even the smallest cost saving areas. It is absolutely essential for the managers, to bring every possible threat perception from multiple projects under one umbrella. This would create better project visibility and establish better control over the proceedings. As it is that oil and gas industry is highly capital intensive, therefore proper planning in terms of budget allocation is very essential for the end to end sustenance of the project.
Every detail has to be carefully observed and accounted for to have a firm grip on the project activities. However, the nature of oil and gas project is such that no mild financial tremors would be felt, unless it has taken the shape of an earthquake. Therefore, it is imperative to have a perfectionist approach to project management to embark on a journey of profit making. Highly competitive landscape of oil and gas sector demands real time data visualization throughout the project verticals. Organization should also have the leverage of an advanced technology, with which smart data capture points could be set up. Every captured data must pass through stringent validation procedure, which will ensure the integrity of the obtained information. It is essential for the technology partner to provide out of the box solutions to the organization, by offering event alert mechanism. Any discrepancy should be addressed then and there, without any delay, so that the same does not result into massive working capital losses.
It is essential for the organization to have an advanced spend analytics module, which would streamline financial roadmap and make processes efficient. Project leads need to have the leverage of real time reports generated from smart capture points, for better resource allocation and management. It is important to keep a tab on the account payable versus receivable ratio, so that working capital doesn’t dry up. It is important to have a thorough understanding of all the components of the supplier invoices, which is a key to better project management. Organizations should have the leverage of a technology, which streamline P2P (Purchase to pay), process. It is essential to track every activity from the generation of purchase indent to purchase order and then finishing up with the goods receipt note of the ordered material.
With primitive project management tools, organizations do face lots of challenges with respect to capital expenditure tracking. Advanced technological capabilities are required for clear cut understanding of fund flow for capital expenditure, thus churning out innovative saving strategy. Technology based activity costing methods are best for bigger project management, as it makes the process leaner buy cutting out any wasteful activity. Activity based costing methods departmentalize the organization into profit and cost centers, which provides for better understanding of the project. Good project management software must have a cohesive approach, which gives a snapshot of all the activity with the press of a button. Field data are the lifeline of any oil and gas project, which needs to be managed centrally. The technology must be able to account for different hydrocarbon allocations and integrate the revenue system, with organization’s financial activity tracker.
It is also important to have the power of trend forecasting, based on past historical data and current well parameters. Advanced oil and gas production software, paves the way for proactive production resource planning based on accurate forecasting reports. This will help the field engineers spend less time on doing paper works; rather the same could be utilized on making critical decisions pertaining to day to day operations. Advanced well monitoring tactics, helps in better understanding of future course of actions in terms of organizational policies. It is also important for the technology to function, in line with the regulatory governmental framework, to avoid any future discrepancies. Therefore, the system should generate results which are audit ready and transparent, which increases business confidence of shareholders.