PwC/Landmark offer Teras without tears!

PricewaterhouseCoopers and Landmark have joined forces to offer integrated services at the frontier of geotechnical and financial computing. At the heart of the offering is Landmark’s Teras suite. PwC is to add its experience at integrating this with SAP’s R/3 enterprise resource allocation environment.

PricewaterhouseCoopers (PwC) and Landmark are to jointly market and implement capital allocation and performance management software for the oil and gas industry. The new relationship will provide the oil and gas industry with implementation services relating to automate tracking of strategy execution, and to improve management of shareholder value and related information. PDM spoke to Landmark’s  Bill Diggons and PwC’s Mike Hart about the new venture.

PDM - what brought the two companies together on this venture?

Diggons - We have viewed PwC as an excellent partner for upstream SAP implementation. They are expert leveraging Enterprise Resource Allocation (ERA) with decision support systems (DSS) to derive key performance Indicators from economics data.

Hart - We have worked with Landmark, Tobin and SAP for some time on E-portfolio management. Our new offering is Integrated Portfolio Management (IPM) which we define as ERA across multi-valued properties, through the acquire, divest, drill and complete cycle. We help companies realize key performance metrics, apply balanced scorecards. We focus on what interests Wall Street!

PDM - so you are targeting the boardroom!

Hart - Yes but we drill down from there. What we are trying to get across is that increasing production does not necessarily maximize value. We help companies link strategy to overall performance at all levels. For example we move field personnel from the volume/production mindset to what is optimal strategy for the field.

PDM - How are the roles distributed?

Diggons - Landmark defines and configures economic models. PwC adds project management and change management. The client deploys SAP but this is adapted to more rigorous financial treatment. People need to be migrated from their deterministic mindset into a statistical way of thinking.

PDM - How important is the stochastic way of looking at data here?

Diggons - There was great excitement and angst at the SPE Forum this month around this very topic. It was noteworthy in that it was the first time so many experts in the field came together. There was great interest from majors and large independents. It is already accepted in exploration, but is a harder sell to the producer.

Hart - Absolutely - it is hard for many to live with a range of values for everything. But it is crucially important.

PDM - But is it new?

Hart - Companies may have had exposure to stochastics over the years, but what is new is that they now have the tools support such treatment of uncertainty.

PDM - How do you match the hard and fast numbers in SAP R/3 with the elastic input from stochastic modeling.

Diggons - The Teras-derived statistics go into the SAP Business Warehouse. This accepts range values (but not distributions). This allows for OLAP type data mining. But the route does not have to be SAP, we also link Teras with Oracle Express OLAP. Ultimately we plan to be able to forecast budgets in real-time.

PDM - We have seen various standards initiatives in the B2B arena. Where are they now?

Hart - BizTech for Energy (BT4E) was founded by PwC, SAP and Landmark and has been subsequently joined by a number of others. The SAP Energy Integration Platform was subsumed when SAP bought the rights to our Premas product. Premas allowed you to visualize a network of the fiscal flow of product within a field. This can then be uploaded to SAP R/3 or Landmark’s TOW product suite. The difference between the EIP and the present IPM initiative is that EIP maps historical product and cash flows, whereas the IMP is more concerned about current and future value propositions.

PDM - In the end BT4E seems to have got nowhere - except to have signed up lots of members!

Hart - Well I don't know about that! We have contributed our PetroCore check stub XML standards to BT4E and this will be made public. PetroCore is destined to replace the CDEX JIBI (Joint Interest Billing Initiative) that originated with API/PIDEX. PetroCore extends this to the AFE.

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