• AS SEEN ON • The Secret to a (Highly Profitable) Digital Oil Field Management System
If you’re like most operators, reality only settles in once you want to scale your company, try to create some sort of freedom from your operations (ie the reason most of us start a business in the first place), or decide to sell the business. Pick your poison, but it’s one of these three scenarios that always serves as the ice-water-in-the-face moment for the independent operator.
It’s the “oh shit” moment when most – say 99% – of all operators wake up to the realization that they’ve been doing it all wrong.
All of that hard work, all of that great suffering, all of that “doing it, doing it, doing it” – which is the tactical reality of almost every oil and gas operator – that they’ve been consumed with during the years preceding that moment when they finally think to themselves: “How do I scale? How do I make this company work for me? How do I prepare this company for sale?”
Then and only then do they see that there’s absolutely no way they’re going to get from here to scale. Here to freedom. Here to sale. Why? Because the necessary System hasn’t been deployed so that their company can succeed at what it has set out to do.
And while your System may have worked while you had 2, 5, or even 50 wells, any field management solution comprised of text messages, email updates, dossier files on well history, loose run tickets, and daily oil reporting forms in paper or Excel format isn’t going to get you where you want to go.
The System we’re talking about is the creation of your turnkey oil field management solution. Without that, you’ll never have a scalable company. It all begins or dies right here. This choice to invent your oil field management System is the most elemental entrepreneurial choice of them all.
Which is precisely the reason why it’s so damned hard for operators to rise above the entrapment of what we like to call the ‘tyranny of routine’. The calls. The texts. The emails. The daily oil reporting forms (or lack thereof). The mistakes. The incompetence.
Most operators fail to make this choice, or, even worse, make the wrong choice when it comes to oil and gas production software to stand in for their System, and it’s destined to fail from the get go.
It’s “doing it, doing it, doing it” – all until you simply can’t do it anymore.
Key Frustrations: A Checklist for the Oil & Gas Operator
One essential characteristic of oilfield operations (and modern life) is that we all depend on Systems – on assemblages of people or technologies or both – and among our most profound difficulties is making them work.
“All this talk about the System sounds great, but it’s still not clear… what exactly is a System? How can I develop my own ‘System’?”
Your oil field management System – which is essentially your oil and gas information systems workflow – is the methodology through which you deliver the result you have promised to your partners, your employees, and yourself.
It’s how you integrate the visual, operational, functional, and financial components of your oil & gas operations. Everything an independent operator would need to scale from 1 to 10,000 wells (if she so chooses).
For example, the checklist is the humblest of all Systems. Quite simply, the checklist is a quality-control device. The value of using checklists springs directly from the complexity of modern life, whether we’re talking about surgery, flying an airplane, or building a skyscraper.
The complexities of oil & gas operations overwhelm even the best-trained engineers, supervisors, and field staff. What the operator needs in order to achieve Maximum Profit, isn’t just people working together to be nice to each other. It’s discipline. And discipline is freakin’ tough.
We are not built for discipline. We are built for novelty and excitement, not for careful attention to detail. Discipline is something we have to work at.
Good checklists, on the other hand are precise. They are efficient, to the point, and easy to use even in the most difficult situations. They do not try to spell out everything – a checklist cannot fly a plane or build a building. Instead, they provide reminders of only the most critical and important steps – the ones that even the highly skilled professional using them could miss.
Understand, checklists are not just for simple, straightforward tasks. Checklists help people communicate and work together better, especially when the unexpected occurs.
So as an oil & gas operator, we must identify the missing pieces in our operational puzzle – which, in turn, are the systems that need to be there, but aren’t.
Monthly Maintenance Checklist:
- Well testing
- Circulating tank bottoms
- Chemical treating
- Planning upcoming tasks
Daily Maintenance Checklist:
- How much oil and water are in all of the tanks.
- The height of the fluid levels in all sight glasses.
- The pressures on all gauges.
- The levels of water in the disposal system and pit.
- Whether any oil has been carried over into the water system.
- Gauging the stock tank.
- Gauging water levels
- Switching tanks and opening equalizer lines
Checklist for Short Production:
- Problem downhole?
- Oil in the separator gas line?
- Oil trapped in the heater/treater wash tank?
- Paraffin?
- Flowline blocked or plugged?
- A well accidentally turned off?
- Electrical failure?
- Casing check valve fail to close properly?
- Or was a valve accidentally left closed?
Checklist for Downhole Issue:
- Pump valve not seating?
- Gas lock?
- Salt bridges downhole?
- Plugged casing or tubing perfs?
- Worn or failed pump?
- Split tubing?
… you get the idea.
These checklists should serve as an eye opener (and for some of you an emotional roller coaster…)
When working through these Checklists, you must ask yourself: “Do I have this? Do I have that? Do we know this? Do we know that?” From function to function to function to function. It becomes transparently clear that you don’t have almost anything we need to have in order to operate our company as effectively as a McDonald’s.
Which is why we say that your operation’s ultimate success depends upon the creation of an exemplary turnkey System, which says, to all and sundry, “This is how we operate here!”
A System that doesn’t depend upon your ability to find and hire exemplary pumpers, production techs, or assistants, but upon YOUR exemplary ability to systematize the management the affairs of your pumpers, production techs, and assistants (via simple tools like the checklist).
Unfortunately, few of us are taught this as oil field managers. It might be said that we are left to discover it on our own (or not). The signals we receive from industry conferences, executive education and the like, are at best, veiled instructions, brought to us in the form of edicts and directions rather than inspiration.
Lower your operating costs!
Be more efficient!
Employ a multi-well drill pad!
Of course these instructions are the product of other human beings’ genuine efforts to exercise leadership (as, a generation earlier, they experienced it) – but, more often than not, are interpreted as a need to proflecize, rather than create any real change. But the “true North” for the oil & gas operator is its System.
Committing your Oil and Gas Information System to Form
As your quantification tells you that you’ve successfully increased the efficiency or effectiveness of what you do by how you do it, the very next leg of a successful turnkey oil and gas information System is Orchestration.
What do we mean by Orchestration?
By Orchestration, we mean documenting the innovative improvement you’ve made on HOW you do WHAT you do, so that every individual on your team is able to MASTER the new, innovatively disruptive methodology, which has enabled you to produce greater, more effective results, time after time, after time.
Which is, of course, the very meaning of “turnkey”: The ability to replicate successful behavior. Again and again, without fail. This is how we gauge. This is how we record our gauges. This is how we hold our purchasers and service companies accountable. This is how we send in our tickets. This is how we reconcile those tickets.
Because, to the degree that you’re unable to replicate successful behavior, your ability to scale, sell, or simply take more time off is not only hampered, but blocked. Keeping you in that unfortunate state most oil and gas operators find themselves in, looking for better and better people in the hope that they will bring better and better results.
“It’s the people!”, most companies exclaim. Well, if that were true, that success resides in finding better and better people, Ford Motor Company would have never succeeded. Nor would it have grown. No company can.
To the contrary, success – which means your ability to grow exponentially, effectively and predictably – resides not in the acquisition of better and better people, but in the creation of exemplary systems, which the greenest of pumpers and most inexperienced of production techs can learn to master. Continuously.
For example, when managing, acquiring, or drilling any well, a key component of your System is the data capture solution you roll out to your guys and gals in the field. It’s only through the eyes, ears, and minds of your pumpers and field personnel that this information can flow to everyone else in your operations (and Why it’s Crucial You Organize Around Data (Not Personalities) in Oil and Gas Asset Management). Your oil field management System should create better pumpers – in fact, it’s from this information which all improvement flows.
To be clear, it’s not just ‘systemized capture’ of sending data back to HQ – it’s a two way communications platform giving your pumpers the ability to call upon a knowledge base of the experience your company has assembled to operate these wells: historical production, graphing, commentary from anyone who’s ever visited the well site.
To keep your costs as low as possible, GreaseBook runs on whatever device your pumper already owns Apple, Android, or Microsoft.
Your Oil Field Management System is Your Promise
In the marketplace of oil & gas, the cost at which you extract oil and the System that enables you to do it is who you are. This system you either create or ascribe to is the reason your company is alive. However, as the world changes, you and your operations must become “street-smart” if you’re going to stand a chance of succeeding – perhaps, even surviving.
Remember, all of this work we’re doing is about getting results. We’re not creating only to be creative. We’re not innovating simply to be innovative. We’re not operating oil & gas wells just to operate oil & gas wells. We’ve got a serious end in mind. And, to discover how to get there, we’re going to want to study the laws of production and cost to most effectively produce exactly what we’re looking for from our oil & gas assets which is Maximum Profit.
You’re looking for a System that has already proven itself. One that can be successfully implemented. One that successfully delivers the improved results you require. One that enables you to scale at will, in the hands of ordinary people, all at a low cost, to give you an extreme competitive advantage.
And we simply believe that a new breed of field service software is the quickest to get you there (for example, through a killer oil and gas app for operators…)
Sure, you hear a lot of talk about the digital oilfield, introduction of scada to oilfield operations, and the implementation of E&P tank software and hardware. And while this idea of the ‘digital oil field’ and its tools has merit, most operators roll these expensive systems out before they come to understand their most chronic dysfunction. And that underlying dysfunction is always a strategic problem, a workflow problem, something easily solved by reevaluating the way they communicate – never a technological problem.
Unfortunately, instead of reevaluating their System (which would solve 90% of their issues for a fraction of the cost), most operators that roll-out SCADA and sensors simply exchange a set of systematic personnel issues for a new set of technological issues.
That said, allow us to articulate the simple, clear-cut premise that “the System is the solution”. Not the hardware, nor the sensors, nor the tank sticks. The idea that “The System is the solution” is core to our position in the marketplace: to transform the state of oil & gas operators nationwide.
The human element in Oil & Gas is alive and well, and the model for all successful oil and gas operators is one in which “systems run the business and people run the System.”
And, to achieve this objective of ours, we had to invent the scalable, universal oil field management software SYSTEM, which could have resonance with and be applied to every single oil & gas operator in the country.
Not only that, but be executed by the greenest of gauger, most technologically challenged pumper, and inexperienced production technician in exactly the same way every single time—in the same way a minimum wage worker makes a Big Mac or french fries.
First and foremost (and where so many of our contemporaries failed to execute, or perhaps failed to listen) was that the System must be Simple. Once the idea simplicity is recognized and achieved, you move on to be scalable. To be replicable. To be manageable. To be repeatable.
To follow the quality lexicon and to flawlessly and consistently exhibit the System’s best practices, delivering a consistent, satisfying result Every. Single. Time.
Today, that ‘digital oilfield dream’ is known as GreaseBook. And we are transforming the state of independent oil & gas operators nationwide.
GreaseBook works beautifully on any computer, PC or Mac.
