The “on-tap” subsurface team has significant cost advantages
OPC’s cost effective “on-tap” model which provides a dedicated sub-surface team without the overhead burden perfectly meets the needs of all cost conscious oil companies.
The growth in smaller independent and venture capital/private equity backed oil exploration and production companies has been one of the key trends of the last three years. According to Drillinginfo, in its February 2019 Energy Capital and Market Data & Trends Report, there are approximately 500 E&P companies that are PE (private equity) portfolio companies. Sixty of those were formed in 2018.
Unlike the historic “drill at will” attitudes of major oil businesses, newly established oil and gas companies have a culture that demands the greatest fiscal care and frugality, with the highest priority given to protecting your balance sheet and obeying board and investor mandates to “operate within cash flow”.
However, keeping costs low does not help technical directors who need to have an accurate and expert understanding of the assets within the portfolio in order to maximise production, honour reporting requirements to the authorities and optimise the return for the business.
The On-tap Subsurface model
The pressure to keep costs low and have a high level of expertise has led to the development of an “On-tap” subsurface team model which has been adopted by two oil companies this year.
The subsurface team is staffed by permanent and experienced members of the OPC technical team. They deliver a steady “flow” of expertise to cover the regular/ongoing subsurface activities and then can provide additional expertise “on-tap” to cover potential new projects, acquisitions or trouble-shooting. A monthly reporting system is also part of the scope of work that includes recommendations for other cost saving measures and ways of optimising production.
The model provides a high level of expertise at a fraction of the cost of investing in a full time permanent subsurface team and gives guaranteed access to highly qualified subsurface professionals for fast turnaround projects.
Piers Johnson, Managing Director of OPC said
“What OPC are now delivering is what I have been promoting for many years as a cost effective means of supporting an oil or gas operator. Newly established investor backed companies have quickly seen the benefits of this approach – but it is available to any oil business, regardless of size or ownership. We provide all that is needed to not only support, but also, on request, manage the subsurface function on behalf of our customers. They receive the monthly reporting that they need and have immediate access to a large, multi-disciplined and experienced subsurface team when they have projects and work that needs additional support. And the best part is, it costs considerably less than employing a fully staffed permanent sub-surface team.”
Packages for the “on-tap” model start from less than GBP10k per month and can be used by oil and gas asset owners, investors and oil companies. For more details please visit our page dedicated to the On-tap subsurface model
To discuss the “On-tap” subsurface team model in more details, please contact:
Tel: +44 207 7428 1111