Market volatility and many ongoing uncertainties in the oil and gas sector require that operators are on top of operational risk management, compliance and Environmental & Social Governance (ESG).
There are 4 core focus areas for Operational Risk Management:
- Cost management and savings
- Throughput (production performance)
As regulatory pressure for compliance becomes more stringent there will be more changes to regulations and adoption to these needs to be swift. Oil and Gas companies cannot afford the risks of being non-compliant. Resource Energy Solutions (RES) has seen first-hand the many changes in the industry for our clients, and new requirements and will continue to come into effect.
We are taking steps to address this in our Well Operation platform called Total Operations, Risk & Control (TORC). This solution is a paradigm shift in the way operators can stay on top of Operational Risk and Compliance.
Managing accurate information, a consistent business process for all, and getting the information to those that need it most (digitization) and in real time, are critical in regulatory compliance and cost savings.
- Achieving operational excellence is no longer optional – it is critical.
- Operational excellence allows oil and gas leaders to confidently say and prove that they are running their assets safely, reliably, sustainably and cost effectively.
- Noncompliance can face production delays, cost overruns, unintentional loss of data.
- Effective compliance requires that companies stay updated on the latest regulations, including those Specific to each region in which they operate.
- Saving hours of time tediously managing hundreds of tasks and activities that often results in companies failing to stay on top of regulations
- Companies need to respond with agility to market demands while keeping them in compliance and reducing exposure to noncompliance and risk.
Environmental Health and Safety remain paramount in risk management strategies. Spills, blowouts, and a dangerous work environment in the field are critical factors to address, subsequently more important as we drill and produce in less time. In this fast faced environment it is critical that short cuts are not taken. Solutions to manage this multi-faceted environment are necessary to keep the operators on top of all the moving parts.
Why operational risk management? Operational risk is fully in your control.
- Cost reduction.
- Lack of available Experts.
- Operational Complexity.
- Increase in projects, complexity and regulations means there are more risks to manage.
Some industry pain points in managing information and operations include the following:
- Operating Functions don’t understand what is possible when it comes to data
- Lack of automated systems in place
- Lack of Digitalization
- Increase in complexity of regulatory compliance
- Real time data accessibility by all stakeholders
- Excel spreadsheets use is widespread
- Tracking deadlines on Well Operations and regulatory compliance tasks
- Training costs on new regulatory rules
- Maintaining a consistent process throughout the organization
- Real time field activity, data capture, and monitoring
- Time delays to get information to those who need it most
Timely and accurate data. We continue to hear the pain from operators of not having reliable and quality data. With poor data quality, it becomes more difficult to drive down costs
In many cases it is more cost effective to abandon a well, than to continue to service the well, and spend money on leaseholder fees, and continued, inspections, and regulatory reporting. Knowing when to abandon, or which wells should be abandoned ahead of the others can save costs long term.
How RES handles operational risks:
- A consistent business process/workflow to follow ensures real time monitoring and tracking of all operational, regulatory and compliance activities without relying on excel or potential human error.
- A validation engine ensure what you report to the regulator is accurate.
- Documents are managed and stored for regulatory and audit purposes.
Published by Trent Marx, President & CEO, at Resource Energy Solutions.