Data Synergy and the Importance of Understanding an Oil & Gas Specific Maturity Model12/14/2020
If you are trying to maintain your leases at the same time as curtailing production, you need certain information available across domains. We explored this first in our blog: Maintain Leases, Manage Shut Ins, and Maximize Efficiencies in a Downturn.
Information like a shut-in date is of utmost importance. If land, accounting, and operations are referencing the same information managed uniformly across systems, it is guaranteed more reliable than the three departments managing information independently of one another. Three people entering data in three different systems introduces more opportunities for error or latency than information captured once and shared between all three systems automatically. This shift from spending time on data entry, data validation, and reconciliation of data across systems to spending time on analysis and decision making is part of an upstream oil and gas data maturity model. This provides more value to the company and drives better decisions that improve corporate performance.
An Upstream Oil and Gas Data Maturity Model
- Level 1 – Siloed – Information is captured and stored in separate systems of record used by each individual department. Information that could be useful to multiple domains is not easily shared through integration but instead through manual entry or reentry in each system.
- Level 2 – Siloed with Collaboration – Information may be manually entered in the system of record for each domain, but collaboration between members of a decision-making team acts as validation for the information entered. If there are discrepancies in information, they can be caught and corrected.
- Level 3 – Shared Across Solutions – One system is designated the system of record with critical information being captured in that system only, then shared among other systems. All information is self-serve to any user or decision maker.
- Level 4 – Unified – There is only one place to enter data with other systems ‘subscribing’ to that data if they want it updated in their respective database(s). All information is self-serve to any user or decision maker.
Levels three and four of the maturity model offer an important advantage to companies in the form of synergy. When a decision-making team needs information like lease provisions, production, interest, or shut-in dates, they can rest assured that the information they seek is definitive across the organization. With only one system of record designated for each field’s data entry, everyone is working off the same data – there are no discrepancies between domains. This means there is no latency in accessing accurate data – if they can retrieve it, it is the most recently captured information.
Users can quickly and confidently make decisions with trustworthy data. When the revenue interest of a well is shared among land, accounting, and production, it becomes clear what the potential monetary impact of a shut in may be to their company without having to perform an on-the-fly calculation. When production data is accurate and available, land and accounting can trust daily estimates for accruals and shut-in dates that would trigger payments based on lease clauses. When land makes a recommendation, having all the data available makes modeling the effects of a change easier for a decision-making team.
Watch our recent webinar on this and related topics. Our land, accounting, and production experts discuss how to best manage shut ins and maintain important leases, plus they offer best practices around optimizing production and minimizing costs. (Click the banner below to download the recording.)