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.
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.
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.
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.
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