Sept/Oct 2011

Managing the workflow

Calgary software firm helps oil companies cut time and costs

By R. Andrews

Operators cannot afford to let delays and missed deadlines slow production down. However, keeping a dynamic project with countless interconnected elements moving forward is a complex challenge. It is one that Resource Energy Solutions (RES) has taken on, and the Calgary-based IT/software company is intent on changing the face of financial and project management for the oil, gas and mining industries.

Since buying the small company in 2006, president and CEO Trent Marx has been selling his suite of software products to some of the world’s leading mining and energy groups. Clients include BHP Billiton, Potash Corporation, K+S Aktiengesellschaft, Oilsands Quest, PetroBakken Energy, TransCanada, Pace Oil & Gas and Tundra Oil & Gas. They are all using RES software to track project activities, monitor costs and improve field reporting, while enhancing accountability and workflow.

Most recently, the company was awarded a large contract with BPMIGAS, Indonesia’s state-controlled oil and gas company. RES is developing a customized workflow, budgeting, planning and financial reporting system to help the nation track one of its primary revenue sources.

Right place, right time

The company’s flagship product, Wellman, began as a simple field reporting tool used by a few small companies. It has since evolved into a comprehensive system that enables field workers and office staff to track costs and manage data for the entire life cycle of a well – from its geology, construction and drilling through to completion and land reclamation. Wellman was developed more than 15 years ago in response to an industry demand for a more efficient, cost-effective solution to store and synchronize data.

“Wellman was designed to do something about the frustration in the marketplace over reporting systems that lacked ease, integration, quality and consistency,” says Marx. “Our software is now used to track and manage thousands of field reports each month from supervisors managing projects worth hundreds of millions of dollars.”

According to Marx, Wellman has turned out to be “the right product at the right time” and it works with other RES products specially designed for the extraction industries. These products include Authorization for Expenditure (AFE), which complements Wellman’s functions with budgeting and internal controls over capital spending.

Keeping an eye on the bottom line

AFE was designed to increase efficiency and accountability by enabling managers to track, document, approve and compare every budgeted, estimated and actual project expense. “One big advantage of the system is that it automatically alerts decision-makers to the status of any outstanding authorizations for expenditures and identifies the location of any holdups or bottlenecks,” says Marx. “You can’t do that with spreadsheets.”

So, how does AFE work in practical terms? At the end of the shift, field supervisors send the daily project details back to the central office, which immediately sees the reports. The daily report populates a weekly report, showing project progress, commentary and accumulated costs, day by day and week by week.

Documents from the field or those stored in the organization’s shared network drive can be aggregated with the reports, providing decision-makers with one centralized location for all project information. The system electronically forwards the relevant documents, data and estimates through the authorization hierarchy for final approval.

“Our software also provides better fiscal accountability and tremendous savings in audit costs,” says Marx. “One client told me Wellman had saved him a million dollars in compliance fees, because he could quickly access all the relevant documents in one central location.”

Drilling data at your fingertips

Other clients also report that RES products have saved time and money. For example, Oilsands Quest has used Wellman for three years to standardize drilling data from the field. “We have multiple rigs east of Fort McMurray, each with a supervisor filing a daily report,” says Simon Raven, vice-president of exploration and development at Oilsands Quest. “When you have lots of people involved in fairly complicated projects and different services, anything you can do to streamline that information flow definitely makes life easier.”

The Alberta-based company hires a variety of drilling consultants for different projects and found that it needed greater consistency and continuity of different data. “If I have hundreds of thousands of records and I want to query later how many wells were drilled between this date and that date, how many wells reported drilling problems and what they were, you can’t do that on Excel,” says Raven.

Time savings and the ability to recognize trends in performance also attracted Tundra Oil & Gas to Wellman.

“We’re a growing organization, and Wellman gives us a user-friendly tool to compile information across any number of projects and to identify opportunities for improvement much quicker than in the past,” says Eric Bjornsson, manager of drilling and completions, Tundra Oil & Gas.

“We have very active field development going on with six drilling rigs and nine service rigs in southwest Manitoba, all of which have to fill out a report every day,” explains Bjornsson. “With Wellman, those reports are distributed electronically throughout our offices and it saves just a ton of time trying to access all this information.” The visual format of RES software is also important to companies such as Tundra. “What the guys see on their screen is the same form that someone else is going to see,” says Bjornsson. “You don’t have to go into a cryptic database and input information in one area and then flip back and forth between multiple screens to see what that’s going to look like in a report. What you see is what you get.”

Untapped potential

Marx contends that any oil, gas or mining company that spends over $20 to $30 million a year in drilling and other operations should adopt RES software to help manage their operations. He believes those levels of financial activity can no longer be tracked with spreadsheets because the industry has become too complex and the stakes are too high.

Marx cites a recent study from the Canadian Energy Research Institute that estimates that $2.077 trillion will be invested in the oil sands over the next 25 years.“New information, development and production technologies will be vital to manage this spending,” he explains. “We intend to become a global leader in those technologies.”

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