Business Strategy and Planning
Having held senior executive positions within energy companies and technology firms serving the energy industry, Petrosaurus, Inc. consultants understand the challenges and opportunities of creating and sustaining a business plan. Our commercial business acumen and deep understanding of operations, technology and risk-management matters help us create effective, value-driven strategies.
Petrosaurus, Inc. offers responsible recommendations that consider what is at stake and who is affected by strategic decisions within each unique business setting. With pragmatism and confidence, we advise companies on how to sustain and grow market value with minimal risk.
Strategy
Strategic thinking is a core competency at Petrosaurus, Inc.. We use our broad experience — as consultants and as energy experts — to perform thorough, insightful business analyses and shape them into fully developed strategies that deliver smart, actionable results. Our solutions are designed to lower transaction costs and mitigate risks, giving our clients the time they need to make the best business decisions in times of transition. We use our to perform not only top-quality business analysis, but also to shape that analysis into fully developed strategies that deliver results.
- Formalized project phases and checkpoints
- Clear accountabilities within an integrated project team
- Checks and balances between central functions and project teams
- Continuous review to measure project value and monitor risk
Petrosaurus, Inc. works hand in hand with our clients to encompass changes in their business which allows clients to improve efficiency in the daily business of transactional processes and reporting, allowing them to focus on operations, strategic planning and business plan execution. With a skilled right-sized staff using high-quality technology, our oil and gas back-office lowers costs and allows for instant scalability, giving our clients the ability to react as their business needs change.
Organizational Design
Savvy operations and technology strategy can result in lower transaction costs, better risk control, a scalable infrastructure and more time overall in which to make stronger business decisions. By analyzing ways to reduce cost and streamline technology and process over the long term, Petrosaurus, Inc. illuminates the relevance and functionality of our clients’ capabilities — mitigating vulnerabilities and redundancies.
We understand that every company has a unique culture and specific business targets — operational and financial. In order to develop the best organizational design for each of our clients, Petrosaurus, Inc. adapts its expertise to fit the distinctive goals and capabilities of each company. These custom organizational models are designed to promote measurable growth and profitability organically, while optimizing efficiency, productivity and performance.
Change management strategies can encompass everything from management and workforce solutions to operations and process, governance and controls, and technology systems.
Given that we’re likely to persist in a low-price environment for some time into the future, it’s important for the shale operators to find additional opportunities to reduce cost. In fact, they need to reduce their break-evens by up to 30% in order to obtain acceptable rates of return on new wells to be drilled.
The first step in doing this is to understand their true cost position on a fully loaded cost per barrel basis, including both capex and operations expenses. Once they understand their true cost position, they can set both cost and productivity targets. On the cost side, there are opportunities that historically haven’t received the same level of focus, such as operations, maintenance and back-office expenses that represent significant opportunities of cost reduction.
In addition, there’ll be meaningful opportunities associated with working closely with their suppliers to reduce more structural costs associated with the well delivery and operations. Although cost will be important, the key lever for the future health of the industry is productivity. Increasing recovery rates by as little as 1% can reduce break-evens by up to 15% and thus allow the shale operators to not only survive, but thrive in today’s low-cost environment.
Facing a long-term prospect of low oil and gas prices, upstream operators need to look at more significant transformations of their businesses and organizations. This is especially important in short-cycle unconventional operations, since the majority of a well’s production comes in the first three to four years. shale operators need to reduce their all-in costs by at least an additional 30%, beyond all of the 2018 cost cutting, to achieve a 10% rate of return on new wells. At today’s prices, even the top-performing companies in the sweetest portion of the Eagle Ford are not achieving a 10% internal rate of return (IRR) on new wells.
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