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Production Sharing Agreements

Production Sharing Agreements. 12 November 2008. Production Sharing Agreements. Production Sharing Agreements (PSA's) are among the most common types of contractual arrangements for petroleum exploration and development

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Production Sharing Agreements

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  1. Production Sharing Agreements 12 November 2008

  2. Production Sharing Agreements • Production Sharing Agreements (PSA's) are among the most common types of contractual arrangements for petroleum exploration and development • Under a PSA, the Government/State (as the owner of mineral resources) engages a foreign oil company (FOC) as a contractor to provide technical and financial services for exploration and development operations • The FOC acquires an entitlement to a stipulated share of the oil & gas produced as a reward for the risk taken and services rendered

  3. Production Sharing Agreements • Cost Transactions & Production data • User defined equations created based on agreement requirements • Calculations generated to determine equity and/or entitlements

  4. Production Sharing Agreements Flexible calculation framework built around the concept of plug and play equations • Equations are chained together based on specific PSA’s • Individual equations could be swapped out as business requirements change without affecting the other equations in the chain • Core equations can be shared between PSA’s

  5. Production Sharing Agreements • Stand Alone Application (requires Enterprise Upstream Base) • Agreements, Report Centers, RC Hierarchy & Codes • Cost & Production Data • Integrated solution for EU clients • APIs for 3rd party cost, production & lifting data

  6. Production Sharing Agreements • Agreement Header Information • Hierarchy, Equation Group, Dates, Description, etc. • Contexts • Basic elements of the PSA Equations module • Agreement Context Information • Tax Rates (VAT) • Beginning Balances • Pricing • Scales • Production Volumes • Product, Disposition, Volume, BTU, etc. • Cost Transactions • Recoverable, Non-recoverable, Phase, Classification • Lifting Transactions • Product, Disposition, Volume, Price, Party, etc

  7. Production Sharing Agreements • Functions • Users can conquer the most complex equations via PLSQL functions • Calculation Expressions • Increased the amount of standard functions available for use in calculation expressions • Users can generate 99% of their equations using calculation expressions vs. PLSQL functions • Examples: • Least, Greatest, $Scale, $Context, $Prior, $Ref

  8. GET_GROSS_PRODUCTION 100000 GROSS_PRODUCTION GET_PRICE_PER_UNIT 65 PRICE_PER_UNIT GROSS_PRODUCTION CALC_GROSS_REVENUE 6500000 GROSS_REVENUE PRICE_PER_UNIT OUTPUT TABLE GROSS_PRODUCTION 100000 PRICE_PER_UNIT 65 GROSS_REVENUE

  9. Production Sharing Agreements

  10. Production Sharing Agreements • Ability to create process groups • Create a single agreement with multiple equation groups associated to it • Identify the order in which you want the equation groups processed • Allows for processing and reprocessing of equations when data from one equation group is required for processing of another equation group

  11. Production Sharing Agreements • Ability to run PSA based on actual or estimated data • Users can input actual & estimated data into any of the interface tables (Cost, Production, Lifting) • Users can choose to run PSA calculations for either actual or estimated data • Actual results can be compared to estimate based results

  12. Production Sharing Agreements • Version Control • Both actual and estimated calculations are version controlled • Output is issued version number on submission • Latest version remains on output table. Prior versions moved to history table • Ability to compare versions via reporting or on-line query

  13. Production Sharing Agreements • Enhanced Audit Reporting • Users can choose the following when submitting the PSA report: • Audit – contains complete calculation elements, values and results • Debug – contains all actions executed during processing • None – no debug messages (default)

  14. Audit Reporting

  15. Equations • Calculation expressions are the preferred method to setup equations • PL/SQL function are only to be used on very complex logic that cannot be handled via calc expressions • Calculation expressions are more visible and auditable – no black-box concept • Business analysts can create equations using calculation expressions whereas technical assistance is needed to code PL/SQL functions. • PL/SQL functions need to be compiled in the database before you can use them. Calculation expressions are dynamic and executed at runtime.

  16. Equations • Equations generally take zero or more input contexts and output one or more contexts • PL/SQL functions can output more than one context value whereas calc expressions can output only one output context value • Having each equation output one and only one value using calc expression is preferred as it makes the equation more meaningful and re-useable

  17. PL/SQL Functions • PL/SQL Functions are basically Oracle Stored Procedures • PSA provides a very flexible calculation framework for creating PL/SQL Procedure • Framework provides all the plumbing necessary to stage the input context values and write the output values back to the table leaving the developer to focus on the calculation that needs to be done • Detailed documentation available on the calculation framework

  18. Calculation Expression • Most logical way to create equations that mimic spreadsheets which will the starting point for almost all PSA’s • One equation  One purpose  One Output • Easy to develop and debug • Basic SQL knowledge helpful when writing expressions

  19. Calculation Expression • Input context values used in a calculation expression are prefixed with a colon “:” Example: :GROSS_PRODUCTION * :PRICE • When the expression is evaluated the context names are substituted with their appropriate values from the output table • If the output values of contexts GROSS_PRODUCTION and PRICE were 1000 an 50 for example, then the SQL expression would be SELECT 1000 * 50 FROM DUAL; • The output of the above SQL statement, 50000, would then be written to the context identified in the equation as the output context.

  20. Calculation Expression • Helper functions are PSA seeded oracle pl/sql functions • Like oracle built in functions, they may accept parameters where necessary and always return a single value • Helper functions are identified in the calculation expression by prefixing them with “$” sign. • The goal is to create additional helper functions as the need arise

  21. Helper Functions

  22. Additional Benefits • Leverage Existing Components • Security • Parties/Sites/Roles • Agreements • Report Centers • Codes • Fully productized and supported by P2ES • Documentation / On-Line Help • Allows Internal Specialists to focus on the jobs they were hired to perform • Uses standards and addresses dependencies • Common code set used by multiple clients

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