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Pilot project for the implementation of an ERP system based on SAP (Integrated LUKOIL Overseas Management System) in TOO Karakudukmunay

Pilot project for the implementation of an ERP system based on SAP (Integrated LUKOIL Overseas Management System) in TOO Karakudukmunay

Industry

Oil & Gas

Service

Implementation of an ERP system based on SAP in TOO Karakudukmunay

Company

The Karakuduk field developed by TOO Karakudukmunay is located at 365 km to the North-East of Aktay (Kazakhstan). The oil was first discovered there by Soviet exploration geologists in 1972, but commercial development started just in 1988. Five years later, in 2003, the first million of tons of oil was produced. In May 2010 the cumulative production volume reached 7 mln. tons of oil. When the LUKOIL oil company arrived at the end of 2005, a new stage of TOO Karakudukmunay development started. The achievement of higher results required the implementation of advanced technologies in terms of IT support and infrastructure. The Parma-Telecom company has been a strategic partner in terms of the implementation and maintenance of enterprise project management systems, integrated management systems (ERP), automated plant management and process control systems, IT services.

Objective

To provide strategic management and key processes management in the oil&gas asset, focusing on production processes and production planning of the company.

Implementation Description

The automation solutions covered the following units: Production Accounting, Plant Maintenance (TORO) and such auxiliary units as Procurement and Financial and Economic Accounting.
The Production Accounting and TORO modules were integrated with the Holding's strategic planning systems based on "Potential-based planning", which ensures a complex approach to asset management, the maximization of its cost and performance improvement. The "Potential-based planning" methodology together with production modules allows:

  • evaluating the potential production levels (the production levels are calculated as part of this process considering the geological and hydrodynamical features of the field);
  • planning the field development (the mid-term field development plan is created as part of the process, ensuring the achievement of the optimal production level);
  • optimizing the production (as part of production optimization operation management of the field development plan is performed and wells-candidates for geological and technical activities are selected).

As the enterprise management system was developed, the following functionalities were implemented: Operation logistics, power facilities shutdown management and geological & technical activities management.
A solution for geological and technical activities management was designed alongside with the standard SAP functionality jointly with Parma-Telecom. As part of the geological and technical activities solution a global corporate template for geological and technical activities performance tracking was developed, a process for automated transfer of basic indicators (planned, actual, distributed) of wells activity to SAP ERP. The actual results and achieved effects of geological and technical activities are displayed in SAP ERP. Using interactive reports one may track the execution both with regard to the basic annual geological and technical activities plan and to its current relevant version.
To support the company employees adaptation to the new system, its population with data and methodological support, Karakudukmunay organized an enterprised management system capability center.

Result

Processes automated: Production accounting, plant maintenance, procurement and financial & economic accounting, operation logistics, power facilities shutdown management, geological & technical activities management.
The Production Accounting and TORO modules were integrated with the Holding's strategic planning systems, which enabled a complex approach to asset management, the maximization of its cost and performance improvement.
Management procedures were formalized, which let the company switch from total administrative control to control by variances.

Client's comment

"When during the implementation of our new projects we use the services of our partners, global experts in the oil & gas industry, we can be sure of their successful implementation. Parma-Telecom is exactly such a partner for TOO Karakudukmunay.

Stepan Gyrzhiy, Chief Executive Officer of TOO Karakudukmunay


Article. Enterprise information systems implementation – path to perceptible effects, Oil&Gas of Kazakhstan**


** The material is available in Russian version only

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