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Control Oilfield Equipment Costs through Job Site Portal and Rental Job Costing

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With oil prices recently falling to a 5-year low, the industry is under increasing pressure to determine ways of controlling costs and one of the opportunities for cost reduction lies in the supply chain. Many companies are now re-evaluating their supply chain to see what steps they can take to reduce the costs incurred by suppliers, materials and equipment and find solutions for controlling costs.

I am currently involved in implementing a Project where these factors have been important. The customer has previously been reliant on paper driven working and recognized the inefficiencies inherent in this. More importantly they became aware of not being able effectively to control costs of equipment from third parties.

Using the Portal enables them to regulate requirements from site, source the appropriate supply and if required build in an approval hierarchy. From the site point of view they have access to real-time information of equipment currently on rent, awaiting pickup and also view recent transactions, rather than relying on paper based information which could be up to a week out of date. Requisitions, progressing to orders with back to back re-rent purchase orders within designated approval limits, control of off-rent and damage charges are all easily managed.

The application is easy to use and provides a consistent process which is easy to maintain in personnel knowledge terms, bringing on new hires as and when there is an upturn in business without lengthy training.

Costs are controlled in terms of equipment time on site from a third party being only the time required, removing the possibility of forgotten re-rentals racking up charges. Rates are maintained in the system for specific suppliers, with the ability to add uplifts depending on the business, again improving efficiency, removing errors and disputes, all costly to resolve from a time point of view.

Over this layer of practicality is the application of Project coding which has been of huge benefit in allocating costs and revenue to the business, which can be performed on the core application or via the portal, giving immediate update without delays incurred in processing paperwork, and limiting input errors due to the inbuilt validation rules required by the customer.

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