Identify Cost Reduction, Production Efficiency & HSE Opportunities in Your Permian Field-Level Production Operations
Improving operational production efficiency of drilling, completions, construction, production operations, and well delivery planning is important for Permian Basin operations. Unfortunately, it is difficult to identify which areas offer the greatest potential for cost reduction and whether Permian field operations are operating at maximum efficiency and uptime.
To address these issues, the Permian Basin Operational Performance Analysis (Permian Study) uses proprietary data to compare your performance against other operators to identify and quanify improvement opportunties in your field.
“Solomon does a great job at normalizing the data of a field. The study is an excellent fit with our strategic intents of operational excellence and cost reduction. We have already seen significant cost savings.” OPERATIONS LEADER, INDEPENDENT PRODUCER
Solomon's 2021 Permian Study identified improvement opportunities averaging 150M USD in potential cost savings and production efficiency uptime.
- Identification and ranking of reliability issues that result in production losses compared to peers
- Reliability KPIs
- Analysis of both competitive (unit) and normalized costs across operating expense (OpEx) categories
- Recommended maintenance expenditures to balance cost savings and reliability
- Compression analysis including utilization, cost per horsepower, and rental versus ownership
- Staffing level and cost analysis including cost per person, staff per supervisor, and staffing levels
- Energy usage including costs, intensities, and normalized performance
- Chemical expenditure comparison
- Well servicing and workover cost analysis
- Artificial lift failure rate comparison
- Saltwater disposal cost per barrel, both company-operated and third party
- Support and overhead (General and Administrative [G&A]) cost analysis
- Health, safety, and environment (HSE) performance, including personal and process safety
- Carbon emission calculations comparing intensities, normalized performance, and source compositions
The study benchmarks Permian Basin operators’ drilling and completions performance to provide reccomendations to improve production efficiency, cost reduction opportunities, and enhance safety and environmental performance. Many participants leverage large operational cost savings while concurrently boosting production performance.
Typical Study Boundary
The Permian Study uses proprietary Comparative Performance Analysis™ (CPA™) methodologies and key performance indicators (KPIs) to compare and assess the operational performance of basin operators relative to peers to enhance operations performance in the medium- and long-term.
- Compare performance with leading Permian Basin operators
- Benchmark uptime reliability metrics against peers
- Use data trends to identify potential cost optimization opportunities
- Discover and prioritize improvement opportunities with the highest impact
- Better understand operations performance and cost drivers
Study participants receive the following:
- Performance indicators and rankings for key areas of analysis: Field Operating Cost, Production Efficiency & Reliability, Carbon Emissions, and Safety
- Economic gap analysis versus top-performing peers, and identification of key underperforming areas
- On-site presentation and discussion of study results and recommendations
New Metrics that Support Emissions Strategies
Several new methodologies have been added to improve onshore operations cost and reduce emissions, including:
- Energy Intensity Index™ (EII®)
- Carbon Emissions Index (CEI)
- Operations Delivery Index
Frequently Asked Questions (FAQ)
A: The Permian Study uses proprietary CPA methodologies and KPIs to compare and assess the operational performance of basin operators relative to peers to enhance operations performance in the medium- and long-term.
A: In addition to a detailed analysis of basin operations, participants receive: measures of average well productivity and employee productivity, identification and ranking of reliability issues that result in production losses, diagnostics for using cost performance signals by cost category, including water handling, compression, and artificial lift, an evaluation of the costs of compressor rentals and compressor fuel gas utilization in their shale operations, and an analysis of direct and indirect support costs.
A: • Standardize well pad, wellbore, completion, and well site facility design • Re-use water for completion operations • Manage off-pad and off-lease completion activities to minimize well frac hit problems • Effectively deliver new pads and facilities to maximize uptime on the most prolific wells • Install the most efficient and effective artificial lift method(s) in a timely and cost-efficient manner • Access cost-effective solutions for produced water disposal • Incorporate SCADA systems, Integrated Operations Surveillance Centers, production, and loss reporting • Maintain a clear strategy on company-provided integrated services and contracting of services • Use of value-adding technology in the complete well delivery process
A: The study scope includes the operations of wells from subsurface to wellhead equipment, surface gathering and processing facilities/equipment, in-field flowlines/pipelines, and the field general administration that directly supports the above operations.
A: The Permian Study reviews are an “asset-to-asset” comparison considering the complexity associated to each asset using normalization factors.
A: As the cost accounting systems for E&P companies differ significantly, Solomon has developed a standardized set of cost categories that are used in every benchmarking study. This important step levels the comparison of operating expenses for each asset.
A: Solomon’s key approach for cost normalization is to define relations between cost drivers related to each cost category. Solomon normalization models are developed for each cost category and each peer group. The normalized assessment works to pinpoint performance gaps between the asset and peer group leaders and discovers potential cost optimization opportunities in every major category.
A: The study includes assets from Integrated Oil Companies and Independents.
A: The typical study takes about 6 months to complete.
A: The success factors that the Permian Study uses to maximize benchmarking value are as follows: Stakeholders Commitment, Data Quality, Findings Relevance, and Opportunities Prioritization.
Learn How You Can Participate
The objective of the Permian Study is to identify actionable opportunities to help you improve production efficiency, reduce costs, and enhance production. Each client receives customized focused performance feedback to provide the greatest impact for improved resource management, future financial improvement, and enhanced competitiveness. Join other operators that rely on our proprietary methodologies to improve performance and become a Permian Basin leader.
Data Quality, Benchmarking Methodology
A Foundation for Effective Comparative Performance Analysis and Decision Support
We prioritize the integrity and confidentiality of participant-submitted data and rigorously review that data before benchmarking begins. Then, we employ our normalization process and benchmarking methodology to provide valuable and trusted peer group comparisons that deliver meaningful KPIs. Finally, our staff of senior consultants apply their deep industry experience to develop practical insight and recommendations to enable your success.
Additional Studies & Analysis
With 30+ years of upstream benchmarking experience and the world’s largest database of upstream performance data and metrics, Solomon knows what “good” looks like for any given type of operation. The Offshore Study assesses your performance against peers and identifies cost and production improvement opportunities. The study focuses on critical KPIs, including operating cost, cost drivers, production efficiency, and uptime reliability.
If your organization is new to one of our studies or has experienced challenges completing the study data input forms, Solomon can help. Data quality and a proven benchmarking methodology enable results and insight you can trust. Contact us today!