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Contractual Allocation ‘Manual’ Method For PRA

Introduction:

This post describes the requirement, process steps and implications of using method ‘CA Manual Allocation’ for US PRA(Production & Revenue Accounting) Contractual allocation(CA).

US PRA contractual allocation processing is critical prerequisite component of valuation, royalty and compliance reporting. Certain business requirements may necessitate usage of method ‘CA Manual Allocation’.

Requirement:

  • PRA Production allocated Well completion volumes summarized at Measurement Point (MP) level not matching with CA Allocated corresponding volumes
  • Interfaced/uploaded IN PRA Well completion volumes summarized at Measurement Point (MP) not matching with with CA Allocated corresponding volume
  • Totals of Well, MP and Contract do Match between Production and Contractual Allocation
  • Example of mentioned issue shown below with sample data of Production Allocation and Contractual Allocation Results’ comparison:

Certain US Oil & Gas Production Companies do mention the implication of this mismatch causes impact on MP(Measurement Point) level Transport Deductions and Royalty Pricing.

SAP recommended solution in such scenarios would be to use ‘CA Manual Allocation’ method with volume allocation results computed outside SAP system.

Standard SAP provided template can be filled with CA allocated manual data, followed by upload in SAP. Uploaded data is considered for subsequent process steps of valuation and Royalty computation.

‘CA Manual’ Enablement Process Steps:

Step Description Comments Tcode
Download Well Volumes Report in Excel Well Volume Production Report O3U_WCDVL9
Use Existing Contract Volumes at MPs Wet gas Contract Volumes O3U_CA059
Use Existing SPF (Simple Plant Functionality Volumes at MPs Residue & NGL (Natural Gas Liquids) Contract Volumes O3U_CA079
Download ‘CA Manual Upload’ Template Well level contract volumes/energy to be inserted in Template O3U_CA039
Using Well volumes file and Contract Volume file as input insert contract column & respective volumes Wet Gas CA Manual Upload File preparation Manual Activity
Using Well volumes file, ascertain volume allocation factors for each well at specific MP Volume allocation factor of a well, basis of Residue and NGL allocation for specific MP Manual Activity
Using Well volumes file with allocation factor SPF file  insert contract column & allocate respective Residue & NGL volumes for a well for specific MP Residue & NGL CA Manual Upload File preparation Manual Activity
Upload Prepared Wet Gas file and SPF File via CA Manual Tcode Both Files same format, single file can also be used O3U_CA039
Execute CA CA Volume allocation to WI (Working Interest) owners (/PRA/DN_WORKPLACE_P

Prerequisites Of ‘CA Manual’ Execution

  • Delivery Network Setting Change to ‘CA Manual’, Tcode–O3U_DND2

‘Tolerance percentage’ can be input based on business requirements.

Business Realized Benefits Of Using ‘CA Manual’ File For Upload:
  •  Quick file preparation in specified format for both current and PPN (Prior Period Notification) month processing.
  •  Inbuilt validation checks on Energy/BTU/MCF calculations, during File Upload
  •  Limit File upload authorization to specific users via role assignment
  •  Flexibility to store generated file data in SAP Tables rather than via excel file.
  •  Flexibility to modify generated via standard SAP Tcode

Conclusion:

  • ‘CA Manual’ is an SAP recommended solution, guided by certain business requirements
  • All configuration, validation checks meeting audit requirements in place to enable this solution.
  •  Allocation Criterion used for volume split is as per customer discretion, can be volume based or energy value based.
  • Depending upon the Enhancement Pack/SP level, customer may have to implement certain SAP standard notes, provided for CA manual  file upload Tcode
  • Customers can also design a custom program solution to automate the process of ‘CA Manual File Preparation’

 

 

 

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