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Accelerating the three dimensions of E&P clockspeed - A novel strategy for optimizing utility in the Oil & Gas industry

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  • Weijermars, Ruud

Abstract

As the global Oil & Gas Industry enters its third, late lifecycle stage (outlined in the introduction of this study), new strategies and conceptual tools are needed to postpone - or reverse - the decline of the E&P industry. The problem is this: the late lifecycle is principally heralded by limited supply due to finite hydrocarbon reserves, while energy demand soars as world population and the global economy continue to grow. This study therefore proposes a framework through which an E&P company can critically assess its capability in accelerating lag-time between exploration and production. In the first part of this paper (Sections 1-3), the need for a phase-shift toward faster clockspeeds for the Oil & Gas industry is argued to be an important step to close the energy supply gap. In the second part of this paper (Sections 4-6), the strategy concept of clockspeed acceleration is further elaborated and optimization methods for the three principal dimensions of E&P clockspeed acceleration are discussed. The three Clockspeed Accelerators(TM) are: workflow speed, improvement rate of Uncertainty Mitigation and accrual speed of portfolio value. The third part of this paper (Sections 7-11) presents the empirical analysis of E&P clockspeed performance for two peer groups (IOC supermajors and public private partnership NOCs) comprising six companies each. The acceleration of E&P clockspeed can help to optimize production levels of conventional and unconventional oil, and includes diversification strategies that replace non-renewables with renewables. In summary, E&P Clockspeed Accelerators provide the gearshift instruments that enable the energy industry to better meet the required demand/supply ratios. The results of this study translate into the following deliverables for practical use by Oil & Gas professionals: - insight into the concept of clockspeed in E&P industry setting, - use of Clockspeed Accelerators(TM) as gearshift lever tools for monitoring and directing E&P clockspeed, - a template for benchmarking and scaling the cardinal axes of E&P Clockspeed Accelerators(TM) for companies in time-series analysis and cross-sectional analysis, - insight in the critical drivers of E&P clockspeed acceleration based on the companies studied, - a set of recommendations to support and speed up the optimization of the individual Clockspeed Accelerators(TM) for Oil & Gas companies.

Suggested Citation

  • Weijermars, Ruud, 2009. "Accelerating the three dimensions of E&P clockspeed - A novel strategy for optimizing utility in the Oil & Gas industry," Applied Energy, Elsevier, vol. 86(10), pages 2222-2243, October.
    • Handle: RePEc:eee:appene:v:86:y:2009:i:10:p:2222-2243
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    1. Weijermars, Ruud, 2010. "Guidelines for clockspeed acceleration in the US natural gas transmission industry," Applied Energy, Elsevier, vol. 87(8), pages 2455-2466, August.
    2. Tarighi, Sina & Shavvalpour, Saeed, 2021. "Technological development of E&P companies in developing countries: An integrative approach to define and prioritize customized elements of technological capability in EOR," Resources Policy, Elsevier, vol. 72(C).
    3. Ionel Jianu & Iulia Jianu, 2018. "The Share Price and Investment: Current Footprints for Future Oil and Gas Industry Performance," Energies, MDPI, vol. 11(2), pages 1-15, February.
    4. Tor Guimaraes & Ketan Paranjape & Mike Walton, 2019. "An Expanded Model of Success Factors for NPD Performance," International Journal of Innovation and Technology Management (IJITM), World Scientific Publishing Co. Pte. Ltd., vol. 16(07), pages 1-29, November.
    5. Perrons, Robert K. & Cosby, Tonya, 2020. "Applying blockchain in the geoenergy domain: The road to interoperability and standards," Applied Energy, Elsevier, vol. 262(C).
    6. Tor Guimaraes & Ketan Paranjape & Mike Cornick & Curtis P. Armstrong, 2018. "Empirically Testing Factors Increasing Manufacturing Product Innovation Success," International Journal of Innovation and Technology Management (IJITM), World Scientific Publishing Co. Pte. Ltd., vol. 15(02), pages 1-26, April.
    7. Hessam Golmohamadi & Amin Asadi, 2020. "Integration of Joint Power-Heat Flexibility of Oil Refinery Industries to Uncertain Energy Markets," Energies, MDPI, vol. 13(18), pages 1-25, September.
    8. Wonglimpiyarat, Jarunee, 2010. "Technological change of the energy innovation system: From oil-based to bio-based energy," Applied Energy, Elsevier, vol. 87(3), pages 749-755, March.

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