By Erik Schneider
P2's Workflow solution for E&P companies has improved efficiency by more than 50 percent for material transfers at a leading mid-cap U.S. producer.
This customer, which prides itself on having one of the lowest cost structures in the U.S. upstream sector, was managing material transfers with a mix of out-of-date technologies and manual procedures. That made the process of executing and recording transfer requests – an essential and often time-consuming area of oil and gas accounting – slow, inefficient, and error-prone.
From pipes and chemicals to spare parts in storage, every type of production material used in the management of an oil and gas lease needs to be carefully tracked, often requiring specific sets of information. Record keeping needs can vary from well to well, from lease to lease, and from company to company.
Prior to adopting P2 Workflow, material transfers were being managed on a 20-year-old spreadsheet, with requests from the field being input manually. The warehouse would then fulfil or deny the requests based on availability. When approved, the request would be forwarded manually to a back-office accountant who would re-enter the transfer into another system.
The spreadsheet itself was potentially unstable and hard to navigate. The customer needed a reliable solution that would shorten the turnaround time for requests and improve the speed and accuracy of its materials record keeping.
Ideally, this would mean having one system that could take a transfer request entered remotely from the field and automatically route it to the warehouse for approval. Accounting would receive a prompt to add material-specific data like period end dates. From there, all the data would auto-post to the company finance system.
After a review of the available solutions and vendors against these requirements, the company selected P2 Workflow to help them on all these fronts.
Implementation was expected to roll out over 16 months – which P2 was able to shorten to just over 3 months. In addition to training and consultation, P2 helped design standard input forms and tailor the system's workflow to the company's specific needs, across 15 different types of production material.
• Since taking P2 Workflow live in July, the customer has seen a reduction in process time for material transfers of over 50 percent, enabling faster execution of transfer requests and freeing up back office and warehouse teams to focus on core responsibilities.
• The system's automation features have all but eliminated discrepancies and removed the need for month-end reconciliation between the warehouse and the finance system.
• By leaving spreadsheets behind, this producer can take advantage of P2 Workflow's graphic interface to visualize the status of each transfer and generate reports in real-time. They also gain a clear, searchable audit trail of each transaction.
Feedback from the end users has been excellent, and we anticipate more positive feedback as user adoption continues to grow.
Erik Schneider is Senior Vice President, Product Management, for P2 Energy Solutions
Visit source siteAccountingHydrocarbon Accountingback officeAutomationoperational efficiency