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ERP For Energy Enterprises

The Energy sector faces evolving challenges including shifting geopolitical landscapes, supply chain disruptions, evolving consumer demands, and diverse regulatory frameworks. Enterprises must respond swiftly to these challenges, optimizing each function of their operations and ensuring a consistently reliable supply chain for increased profitability.


Challenges for Energy Businesses

Energy companies face complex challenges to stay competitive in the global market. ExD can support businesses with concerns like:

From initial E&P (Exploration and Production) costs like drilling and Lease Operating Expenses (LOE), including both planned & unplanned maintenance costs for machinery, to skilled labour (well tenders and lease operators), an energy enterprise faces a diverse range of operating expenses. Distilling and treatment costs for midstream operations require complex costing mechanisms for effective and accurate accounting and oil marketing companies must grapple with increasingly intricate cost regulations influenced by ever-shifting global prices and local regulations. Additionally, complex collaborative frameworks with external stakeholders through joint ventures require sophisticated expense-tracking and profit-sharing parameters that must be accurately managed for effective cost control.

Assets in energy enterprises are often scattered geographically. For upstream E&P enterprises, managing operational rigs is central to successful operations. For midstream and downstream operations, maintaining refineries, pipelines, trucks and vehicles is essential for streamlined production and delivery. Efficient Master Data Governance (MDG) is crucial for effective asset management, ensuring downtime reduction and lower meantimes in repair and between failures for optimal asset lifecycle management.

An agile supply chain is vital for a thriving energy enterprise. Managing global supply chains, contractors, and distributors is complex and requires careful management to ensure a consistent and resilient supply chain network. Transportation management operations, like route planning and monitoring, are vital to avoid supply chain disruptions. For midstream and downstream enterprises, streamlined procurement, supplier collaboration and optimized spending management are critical to success.

EHS is a multifaceted domain for mitigating risks and ensuring worker safety and environmental health. High-risk operations like Oil and Gas extraction require energy enterprises to develop and ensure robust safety protocols. Environmental concerns and regulatory compliance like carbon neutrality are additional considerations that enterprises and workers must ensure at all times. Failure in this domain can have significant implications for businesses such as regulatory fines, legal actions, shutdowns, higher insurance premiums, loss of market access and diminished shareholder value.

How Energy Businesses Can Become Intelligent Enterprises?

ERP solutions can help energy businesses tackle micro and macro-level challenges with a centralized repository of data, augmented by cutting-edge technology analysis. By leveraging the multitude of tools an ERP has to offer, energy enterprises can not only streamline and optimize operations but also boost profitability during uncertain times.

Upstream Optimization

SAP-enabled intelligent upstream enterprises have access to reliable data capture and validation to improve processes for efficient production at low operational risk. SAP solutions enable automated regulatory compliance and reporting, optimized supply chain operations like procurement, and better asset lifecycle management through efficient Master Data Governance. Moreover, upstream businesses can leverage SAP joint venture accounting to automate transactions and maintain an accurate account. ExD has extensively worked with Mari Petroleum, implementing a diverse range of SAP solutions, including SAP Ariba, SAP Cross Application Timesheet, and SAP Materials Management Modules, to optimize exploration and production operations.

Midstream Optimization

Midstream energy enterprises can optimize primary and secondary distribution through seamless pay processes, integrated simulations to improve inventory accuracy and standardized automated processes across all sites. SAP supply chain management solutions can optimize logistics operations while efficiently managing warehouse operations including managing storage facilities and optimizing stock replenishment. Moreover, industry-specific risk management tools can identify, assess and mitigate operational risks for midstream energy operations. ExD has worked with Pakistan Refinery Limited (PRL) for optimized silo management leading to significantly optimized sourcing and procurement operations through SAP S/4HANA implementation.

Downstream Optimization

ERP-enabled downstream enterprises can make decisions based on real-time insights to reduce service costs and support cross-selling operations. An end-to-end service management support system improves workflow productivity and efficiency, streamlines invoicing and sales activities and enhances process transparency. SAP’s marketing solutions support customer segmentations, helping downstream companies attract and retain customers and SAP industry solutions for downstream operations provide tools for quality control, testing and certification processes to ensure products meet industry standards. ExD has provided SAP implementation and support services to PSO for comprehensive stock management leading to increased efficiency and streamlined operations. Click here to learn more about our work with Euro Oil.

Oil Service Companies

Oilfield service companies can use SAP-enabled asset management mechanisms to optimize asset workflows and downtime reduction for maximum efficiency. Enterprises can use SAP modules like Plant Maintenance, Project Management Systems, Materials Management, Field Service Management and more to optimize services and resource management. SAP enables digital transformation by integrating new technologies like IoT, AI and ML into business processes helping oil companies stay competitive in a rapidly evolving industry. Oil service companies can significantly increase operational efficiency with the help of these integrated technologies.

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