Global demand for energy is growing at a faster pace along with a marked shift in demand growth from “developed” to “developing” world. Though stress on energy efficiency is increasing (energy saved is energy produced!), building additional capacity has become a need for Oil and Gas firms to close demand supply gap.
Driven by unprecedented oil price increase, investment cost in petroleum capital asset also have increased during recent years. Environmental and Sustainability issues are forming an essential element in decision making during a time of regulatory uncertainity. Oil and Gas enterprises across the world are looking for more effective and efficient technology to manage the Capital Asset Management process.
Major objectives of oil and gas enterprises while managing Capital Asset more efficiently are
- Minimizing Total Cost of Ownership
- Improving Productivity of operations
- Making investments sustainable
These objectives can be best met by Capital Asset Managment process (Investment Planning, Investment Appraisal, Investment Approval, Project Planning, Project Procurement, Project Execution, Commissioning, Operating, Maintaining and Retiring of capital assets) if appropriate business-technology solutions to address these objectives are available.
Multiple technologies and numerous players participate in this complex capital asset management business process. Government Bodies, Statutory Agencies, Financial Instituitions. PMC / EPC contractors, Equipment / Material Suppliers, Engineering / Construction service providers, Operations and Maintenance contractors etc are involved in this process along with the Owner enterprises.
Owner firms response to the three drivers to improve long term enterprise value, can be partly improved by integration of information. When a new capital asset is planned, the owner firm would like to have historic information on the lifecycle cost of similar equipment installed previously, to take a decision that can minimize Total Cost of Ownership.
Multiple solutions are serving parts of these processes and different players use technologies based on their internal technology stack to carryout these processes. Custom made excel worksheets for investment analysis, primavera project plans, Design models of equipment etc are few of them. Leveraging on SOA, these capital asset management processes can be integrated and enabled on a single platform for the benefit of all players.
What is the best way to create such a business platform that can be leveraged by all players in Capital Asset Management business? Should it be driven by enterprises owning oil and gas assets? Or should it be an initiative of EPC contracting companies? Or IT outsourcing enterprises see it as an opportunity?