SAP in Oil and Gas

Shell, Marathon and ChevronTexaco presented papers at the annual SAPPHIRE conference in Orlando last month. CTC’s e-Foundation was the largest IT project in the company’s history and Shell reports significant e-business through Trade Ranger.

Bob Ford described ChevronTexaco’s (CTC) e-Foundation Project as ‘the largest, most complex IT project in our history’. E-Foundation provides sales, supply and financial transaction processing, decision support and reporting for CTC’s products business.

E-Foundation was the first major system to leverage SAP’s portal technology and supports 12,000 users. The massive project involved 450 full-time employees at its peak, beavering away for an estimated 1.5 million hours. The project set out to underpin 70-80% of CTC’s transactions in SAP with interfaces to over 60 external systems and to replace some ‘really old’ (25 years!) legacy systems. Project scope centered on ‘order to cash’—the heart of the products business. Enterprise application integration was achieved with Tibco. A whole team was dedicated to data clean up, a necessary and in the end worthwhile activity which removed the need for 30 % of anticipated technical deliverables.

E-Foundation’s biggest gain was in data visibility—suddenly, “you could see exactly where an order was being held up”. An SAP benchmark program carried out by Aberdeen University determined that CTC’s extended SAP implementation has resulted in a huge drop in transaction costs.

Shell’s portals

Shell has 85,000 seats of the mySAP Enterprise Portal and some 60,000 of SAP Solutions worldwide. Ben Krutzen described how Shell is using portals in its upstream business—which has 25,000 employees in 41 countries. Shell’s ‘globalization’ encompasses drilling, capex project execution and IT—which is undergoing a major rationalization towards a global set of tools and applications. Shell was ‘in dire need’ of good collaboration tools and needed to improve information and application accessibility. Shell’s GeoPortal (not actually an SAP portal) ‘moves work to people’. Seismic interpretation or reservoir modeling can be performed by experts on the middle east sitting in an office in Norway. Session ‘shadowing’ facilitates cooperation at a distance. Shell’s e-Learning portal was originally developed by an oil service company using the Top Tier web portal (later acquired by SAP). Shell uses the portal to simplify access to information and applications. Relatively straightforward content is served a large number of users in the form of documents discussion forums. Shell has also developed a Wells Portal—a ‘mock-up’ at the moment but which will likely be productized by Accenture and SAP.


John Cavallero presented Marathon’s SAP HR installation. Project ‘Edison’ set out to provide an enterprise-wide HR system across the domestic and international, downstream, refinery and retail operations. Edison replaced multiple aging systems with a single integrated platform. Edison now has 125 portal ‘eye-views’ visible to 12,000 portal users. Around 110 folks worked on Edison at its peak. Cavallero cited a strong relationship with Price-WaterhouseCoopers and IBM as critical to project success.


Willem Zuidema illustrated Shell’s global e-procurement effort with a case study of a buying tool and a preview of some SAP developments—the Content Integrator and Management Information System—core components of Shell’s global solution. E-Procurement via Trade Ranger impacts Shell’s business by monitoring contractual compliance, reducing and controlling costs, process efficiency and standardization. Shell uses desktop purchasing tools from ElectroBase which are linked to the SAP Market Set, itself comprising a hosted content integrator and business warehouse. The content integrator matches product names across different vendor catalogs. The business warehouse (or MIS) captures purchase orders, invoices and receipts – leveraging USU, SPCE, DUNS and PIDEX standards.

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