These days many of the Oil & Gas companies apply ERP
for their company, such as: Exxon Mobile, Reliance, BP,Shell, BPCL,Aramco Overseas etc. SAP has
developed an industry solution for the oil and gas industry (SAP IS-OIL),
featuring tools and automated processes designed especially for this sector
that we don’t have in SAP R/3 standard. The SAP solution integrates the entire
oil and gas value chain — from wellhead production to the service station. I
want to share my 4+ years of experience in this field debriefing about
functionalities of SAP IS Oil.
The potential benefits of SAP IS Oil solution are
including Improved barrels of oil equivalent (BOE) production, Lower operating
costs, Reduced incident rate and finding cost, Higher return on capitalemployed (ROCE),Lower capital development costs, Reduced days of salesoutstanding (DSO),Improved on-time delivery.
Normally, Oil companies implemented and have FI-CO
(financial controlling) MM (material management) ,SD(sales and distribution)
,TR( transportation). Companies in every country execute the same functions and
solutions with FI, because it depends on regulations or policies of that
particular country. However, business process is different from companies and
also industry for example the processes of apparel or poultry industry are
different than Oil and Gas Industry.
SAP IS Oil contains two major components:
Upstream: In Oil
and Gas industry initial investment is very high for locating the source for
crude oil and then getting the permission from the government of the particular
country where that source lies and then extraction of the oil, no single
company all along cannot bear that expenses so it involves big joint ventures and the material (crude oil) is explored i.e.
from underground source to aggressive storage to refineries. This is called upstream and this covers
joint venture accounting, and all the finance related stuffs.
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Oil and Gas Business Processes |
Downstream: This includes the refining, storage,
transportation, pricing, Logistics, measurement and retailing of final oil and
gas products existing core R/3 sales and distribution a lot of changes has been
done for downstream oil and gas functionality.
It’s difficult to
discuss all about a specific industry in one post and I hope that this will
help you come closer to SAP IS Oil.
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