Ever wondered why the overall return on
investment (ROI) from E&P is around 7% while individual
prospects may have a
15% threshold? The answer, according to Landmark, lies in an overlooked
facet of
current ROI calculation - the failure to take account of the coupling
of
parameters used in risk analysis. Landmark’s contribution has
been developed
around work done in the 1950’s by Nobel prizewinning
investment theorist Harry
Markowitz, now widely used by fund managers. efficient frontier Markowitz efficient frontier techniques are
applied to exploration portfolio risk analysis in the T2B initiative.
Another
component comes from the labors of the standards body formerly known as
COM for
Energy. BizTech for Energy promises tight linkage from geotechnical
applications
such as Landmark’s StressCheck, to warehouse and inventory
information held in
ERP packages such as SAP R3. e-commerce This work has been presented before by Landmark
(PDM
Vol. 4 N° 2) but is now extended mySAP.com portal to the
e-commerce arena. The
third component of T2B is a revamp and re-release of the Teras
portfolio
management suite. OLAP Teras now deploys Online Analytical Processing
(OLAP)
techniques and data cubes to offer rapid what-if evaluation of various
strategy
options. The T2B initiative is the consecration of Bob
Peebler’s I2
Enterprise philosophy - originally sketched-out in 1996. This article originally appeared in Oil IT Journal 2000 Issue # 2. For more information or to comment on this topic email here.