Oil and gas industry leaders—supermajors, nationally-operated companies, and independents—returned to the Upstream Industrial Benchmarking Consortium (UIBC), November 12 to 14, 2018 in Northern Virginia to get an up close look at how well their efforts to improve capital efficiency in a lower oil price environment compare with their peers. During the UIBC 2018 meeting, member companies also reviewed the latest industry research on pressing issues altering the upstream industry landscape. The UIBC is a chartered voluntary association of owner oil and gas companies facilitated by IPA.
UIBC member companies, whose large asset developments and smaller asset-based projects have been evaluated by IPA through the last year, reviewed their individual capital project system performance metrics and trends and also gained insights into how their capital project system performance stacks up against best- in-class performance. Through capital project research and knowledge sharing, companies belonging to the UIBC are able to strengthen their project systems. Industry average system performance outcomes for safety, cost, duration, and production performance are presented during the 3-day annual meeting. Disciplined approaches to capital project spending are recognized industrywide for helping companies remain competitive in the marketplace. From high to low oil price swings and back again, companies are continually rewarded for pursuing asset development system effectiveness improvement.
Several new research studies were presented at UIBC 2018. All UIBC research findings are derived from data in IPA’s proprietary upstream projects database.
The new research studies address the following topics:
Comparing Shale and Offshore Investments on a Full Asset Basis
Efficiency and well productivity gains realized in U.S. shale over the years have been well studied. These gains were triggered by a rapid learning process, optimization of completion techniques and well configuration, and high grading of drilling locations and equipment. Although most oil and gas efficiency gains are focused on U.S. shale, the latest trends in the U.S. offshore are often overlooked. With offshore companies trying to minimize their project design and develop to cost, the deepwater break-even is coming down rapidly. This study takes a close look at shale investments relative to offshore capital projects on a full asset basis.
Understanding the Interface Role on Large E&P Projects
Large E&P capital projects typically have multiple interfaces to manage. Therefore, interface management is an important area of concern. Interface management, according to the independent group Interfacemanagement.org, is “the process used to identify and close gaps between responsible parties and drive interface issues and queries to closure.” All projects perform interface management, but only some actually assign a full-time interface role to the team. In this study, IPA looks at how E&P companies approach interface management and what drives the decision to staff a role dedicated to interface management. The study also examines whether there are any benefits to having this dedicated role on project teams.
Site & Sustaining Capital Organizations: Focusing on People to Support Improvement
In 2017, IPA identified four common approaches non-E&P organizations employ to develop and execute their site-based capital project portfolio. This has proven to be an extremely useful framework to support effectively determining a site’s resource requirements. During this presentation, IPA research will assess whether this framework is equally useful in understanding how E&P site & sustaining capital organizations staff, or should staff, to support their site-based capital portfolios.
In addition, updated past UIBC research covering long-term production performance and effective management of site and sustaining capital projects will be presented at UIBC 2018. Several UIBC member company representatives delivered presentations detailing their successes and shortcomings in improving capital project system performance also. The UIBC meeting provides attendees with many knowledge sharing opportunities and actionable ideas to support their capital project improvement journeys.