Introduction - SAP-Oil and Gas to

PT SAP Indonesia 30th May, 2007

Agenda SAP Oil and Gas solution map Components of Oil and Gas Common business process flows - Downstream Companies using SAP Oil and Gas How other oil companies are benefiting System walkthrough with some scenarios

SAP AG 2007, 2

Oil & Gas

Development & Production Hydrocarbon Supply & Gas Transmission Refining & Manufacturing Primary Distribution Terminal Management Secondary Distribution Commercial Customers Sales & Retailing & Channels

Suppliers & Exploration & Partners Appraisal

Upstream Exploration and Appraisal E&P Contract Management Liquid and Gas Production Allocation and Settlement Supply, Transmission & Trading Bulk Supply Chain Planning and Optimization Bulk Supply Chain Operations and Scheduling Bulk Supply Chain Execution and Settlement Bulk Supply Chain Reporting and Analytics Physical Oil and Gas Commodity Trading Oil and Gas Paper Trading and Risk Management Refining & Manufacturing Refining Operations Lubes Manufacturing Operations Refining & Manufacturing Success Stories Downstream Marketing & Retailing Marketing Planning and Execution Sales Planning and Account Management Opportunity to Cash Customer Service Terminal Management Hydrocarbon Products Transportation Service Station Fuel Management Convenience Retailing Downstream Marketing & Retailing Success Stories Enterprise Asset and Service Management Investment Planning, Design & Construction Sourcing & Procurement Maintenance Operations and Logistics Success Stories

Enterprise Management & Support

SAP AG 2007, 3

Oil & Gas

Development & Production Hydrocarbon Supply & Gas Transmission Refining & Manufacturing Primary Distribution Terminal Management Secondary Distribution Commercial Customers Sales & Retailing & Channels

Suppliers & Exploration & Partners Appraisal

Upstream Supply, Transmission & Trading Refining & Manufacturing Downstream Marketing & Retailing Enterprise Asset and Service Management

Enterprise Management & Support

Analytics Financials Human Capital Management Corporate Services Operations Support

SAP AG 2007, 4

Oil & Gas

Development & Production Hydrocarbon Supply & Gas Transmission Refining & Manufacturing Primary Distribution Terminal Management Secondary Distribution Commercial Customers Sales & Retailing & Channels

Suppliers & Exploration & Partners Appraisal

Upstream Supply, Transmission & Trading Refining & Manufacturing Downstream Marketing & Retailing Enterprise Asset and Service Management

Enterprise Management & Support

Analytics Financial Analytics Financials Financial Accounting Management Accounting Corporate Governance Operations Analytics Workforce Analytics

Strategic Enterprise Management

Financial Supply Chain Management

Human Capital Management Workforce Process Management Workforce Deployment

Talent Management

Corporate Services Environmental Compliance Incentive and Commission Travel Management Real Estate Management Management Management Operations Support Life-Cycle Data Project and Portfolio Global Trade Quality Management Indirect Procurement Global Trade Services Management Management Management

SAP AG 2007, 5

Upstream
Development & Production Hydrocarbon Supply & Gas Transmission Refining & Manufacturing Primary Distribution Terminal Management Secondary Distribution Commercial Customers Sales & Retailing & Channels

Suppliers & Exploration & Partners Appraisal

Upstream

Exploration and Appraisal

JOA/PSC Strategic Planning (SAP S2,S19,S24 ) Capacity Management (SAP S25 Production Execution (SAP S25 Capture Field Data (SAP S25 Volume Determination (SAP S25 Monitor Reservoir Model P6 ) P6 ) P6 ) JOA/PSC Opportunity Analysis (SAP S24 ) JOA/PSC Development (SAP S2,S24 ) Venture Equity Trading (SAP S2,S24 ) Joint Venture Management (SAP S2,S24 ) PSC Management (SAP S2,S24 ) Third Party Drilling Contract Management (SAP S2 ) Third Party Drilling Contract Development (SAP S29 ) P6 ) Well Mapping (SAP S25 )

E&P Contract Management

Liquid and Gas Production

Allocation and Settlement

Contractual Allocation (SAP S2,S25 P6 ) Ownership Allocation (SAP S2,S25 P6 ) Lease Fuel Valuation (SAP S25 ) Revenue Accounting (SAP S25 ) Gas Plant Accounting Regulatory Reporting (SAP S25 ) Reserves Accounting and Reporting

Portfolio and Risk Analysis (SAP S2,S19,S24,S30 )

Identify Potential Exploration Targets

Acquire Leases and Licenses (SAP S2 )

Surveying, Positioning & Evaluation

Exploration and Appraisal Drilling for Boundary Determination (SAP S29 )

Build Reservoir Models

Environmental Compliance Health and Safety (SAP S4 ) Emissions Management (SAP S4,S28 ) Secondary and Tertiary Recovery Depletion Planning Well Abandonment & Site Restoration (SAP S2,S4 )

SAP Product Available

SAP Product Available with Future Releases

Future Focus

Partner Product Available

Partner Product Available with Future Releases

SAP AG 2007, 6

Supply, Transmission & Trading

Development & Production Hydrocarbon Supply & Gas Transmission Refining & Manufacturing Primary Distribution Terminal Management Secondary Distribution Commercial Customers Sales & Retailing & Channels

Suppliers & Exploration & Partners Appraisal

Supply, Transmission & Trading

Bulk Supply Chain Planning and Optimization Bulk Supply Chain Physical Oil and Gas Reporting and Analytics Commodity Trading
Deal Capture Management (SAP S2 P2 ) Trade Contract Management (SAP S2,S23 P2 ) Position Management (Long/Short; MtM etc) (SAP S2 P2 ) Portfolio & Strategy Mgmt (SAP S2 P2 ) Trading Commodity Pricing (SAP S2,S23 P2 ) P2 ) Export / Import Compliance Management (SAP S2,S16,S17 ) Contract Performance Analyses (SAP S2,S23 ) Transportation Performance Analyses (SAP S2,S23 ) Bulk Supply Chain Tax Reporting (SAP S2,S23 ) Asset Utilization Analyses (SAP S2,S23 ) Custody Transfer Management (SAP S23 P5 ) Inventory Update & Management (SAP S23 S2,S23 P2 ) Bulk Movement Planned / Actual Analyses (SAP S2,S23 ) Bulk Movement Profit / Loss Analyses (SAP

Bulk Supply Chain Operations and Scheduling

Bulk Supply Chain Execution and Settlement

Oil and Gas Paper Trading and Risk Management

Risk Assesment and Evaluation (SAP S2,S6 P2 ) Deal Capture Management (paper) (SAP S2,S6 P2 ) Paper Contract Management (SAP S2,S6 P2 ) Portfolio & Strategy Management (SAP S2,S6 P2 ) Treasury & Financial Management (SAP S2,S6 )

Demand Planning & Forecasting (SAP S2,S23 ) Supply Planning & Sourcing (SAP S2,S23 )

Trade Planning (SAP S2,S23 ) Planning Forecast & Actuals Analyses (SAP S2,S23 ) Exchange Balance Reporting (SAP S2,S23 ) Inventory Analyses (SAP S2,S23 ) Trading Analyses (SAP S2,S23

Bulk Marine Voyage Scheduling (SAP S23 ) Bulk Batched Pipeline Scheduling (SAP S23 ) Bulk Operational Inventory Management

Allocation Planning (SAP S2,S23 )

Exchanges & Terminalling Planning (SAP S2,S23 )

Bulk Schedule / Program Planning (SAP S2,S23 )

Inventory Planning (SAP S2,S23 ) P5 ) Hydrocarbon Quantity Conversion (SAP S23 ) Inventory Reconciliation (SAP S23 P5 ) Exchanges & Terminalling Reconciliation (SAP S23 P5 ) Customs Execution Management (SAP S17,S23 )
Future Focus

P5 ) Bulk Movement Invoicing & Settlement (SAP S23 ) Inventory Valuation Update & Management (SAP S23 ) Allocation Processing (SAP S23 ) Exchanges & Terminalling Execution and Settlement (SAP S23

Bulk Transportation Planning (SAP S2,S23 )

Strategic Planning (SAP

S2,S23

P4 )

(SAP S23 P5 ) Contract Operations Management (SAP S23 ) Bulk Supply Chain Monitoring & Control (SAP S23 ) Export / Import Compliance Management (SAP S16,S17,S23 ) Bulk Schedule Management (SAP S23 ) Bulk Rail Scheduling (SAP S23 ) Bulk Continuous (nonBatched) Pipeline Scheduling (SAP S23 ) Exchanges & Terminalling Operations Management (SAP S23 ) Freight Management (SAP S23 ) Allocation Management (SAP S23 )
SAP Product Available with Future Releases Partner Product Available

SAP Product Available

Partner Product Available with Future Releases

SAP AG 2007, 7

Refining & Manufacturing

Development & Production Hydrocarbon Supply & Gas Transmission Refining & Manufacturing Primary Distribution Terminal Management Secondary Distribution Commercial Customers Sales & Retailing & Channels

Suppliers & Exploration & Partners Appraisal

Refining & Manufacturing

Refining Operations
Supply Plan & Sourcing (SAP S10 ) Supply Chain Monitoring and Control (SAP S10,S19 )

Lubes Manufacturing Operations

Demand Planning (SAP S2 )

Crude & Feedstock Inbound Processing (SAP S2 )

Refinery Production Planning & Scheduling

Inbound Processing for Base Oils and Additives (SAP S2,S10 ) Lubes Production Planning (SAP S2,S10 ) Lubes Production Scheduling (SAP S2,S10 ) Lubes Blending & Packaging (SAP S2,S10 ) Warehousing and Storage (SAP S2,S10 ) Outbound Processing of Finished Products (SAP S2,S10 ) Quality Assurance and Control (SAP S2,S10 )

Refined Product Outbound Processing (SAP S2 )

Semi-finished Products Blending (SAP S2 )

Emissions Management (SAP S28 )

SAP Product Available

SAP Product Available with Future Releases

Future Focus

Partner Product Available

Partner Product Available with Future Releases

SAP AG 2007, 8

Downstream Marketing & Retailing

Development & Production Hydrocarbon Supply & Gas Transmission Refining & Manufacturing Primary Distribution Terminal Management Secondary Distribution Commercial Customers Sales & Retailing & Channels

Suppliers & Exploration & Partners Appraisal

Downstream Marketing & Retailing

Marketing Planning and Execution Opportunity to Cash Customer Service

Customer Service Interaction Center (SAP S8 ) Information Help Desk (SAP S8 ) Live Web Collaboration (SAP S8 ) Shared Depot Handling (SAP S8 ) Self-Service Support through FAQ and Solution Search (SAP S8 ) Bulk Transportation Execution (SAP S8,S22 ) Packaged Products Transportation Planning (SAP S2 ) Packaged Products Transportation Execution (SAP S2 ) Bulk Transportation Planning (SAP S8,S22 )

Sales Planning and Account Management Terminal Management

Hydrocarbon Service Station Products Fuel Management Transportation

Station Fuel Pricing (SAP S8 ) Fuel Book Stock Management (SAP S8 ) Fuel Tank Management and Inventory Reconciliation (SAP S8 ) Payment Card Settlement (SAP S8 ) Station Dealer Settlement (SAP S8 )

Convenience Retailing

Customer Profitability Analysis (SAP S2,S8 )

Sales Planning and Forecasting (SAP S8 )

Marketing Planning and Budgeting (SAP S8 ) Campaign Planning and Execution (SAP S8 )

Customer Segmentation (SAP S8 ) Surveying Customers with Interaction Center (SAP S8 ) Complaints Processing (SAP S2,S8 ) Complaints and Returns Analysis (SAP S8 ) Service Performance Analysis (SAP S8 )

Sales Pipeline and Funnel Analysis (SAP S8 ) Sales Performance Analysis (SAP S8 ) Account Processing (SAP S8 ) Activity Processing (SAP S8 ) Account Analysis (SAP S8 ) Replenishment Planning (SAP S22 ) Supplier Managed Inventory Processing Hydrocarbon Quantity Conversion (SAP S8 ) Terminal Automation (SAP S8 P5 )

Campaign Monitoring and Analysis (SAP S8 ) Lead Processing (SAP S8 ) In- and Outbound Telesales (SAP S8,S22 ) E-Commerce Sales Order Processing (SAP S2,S8 ) ()

Analytics for Field Sales Force (SAP S8 )

Activity Processing (SAP S8 ) Opportunity Processing (SAP S8 ) Inquiry Processing (SAP S2,S22 ) Quotation Processing (SAP S2,S8 ) Contract Processing (SAP S2,S20,S8,S22 ) Sales Order Processing (SAP S2,S8,S22 ) Freight Cost Handling (SAP S2,S8 ) Bulk Shipment Reporting (SAP S8 ) ()

Physical Stock Monitoring (SAP S2,S8 ) Physical Stock and Book Stock Reconciliation (SAP S8 )

Category Planning and Analytics Assortment Management Physical Inventory Store Replenishment Supply Chain Visibility & Tracking Retail Pricing Promotion Management Store Promotion Management Merchandise Distribution Customer Loyalty Analysis POS Data Analytics Data Download Data Upload Category Planning & Analytics

Lead Analysis (SAP S8 )

Analyzing local data with Mobile Client (SAP S8 )

SAP Product Available with Future Releases

SAP Product Available

Future Focus

Partner Product Available

Partner Product Available with Future Releases

SAP AG 2007, 9

Downstream Marketing & Retailing

Development & Production Hydrocarbon Supply & Gas Transmission Refining & Manufacturing Primary Distribution Terminal Management Secondary Distribution Commercial Customers Sales & Retailing & Channels

Suppliers & Exploration & Partners Appraisal

Downstream Marketing & Retailing

Marketing Planning and Execution Opportunity to Cash Customer Service

(continued) Fleet Management (SAP S2 ) Tour Planning (SAP S22 ) Data Collation (SAP S22 ) Export Control (SAP S16 ) (continued) Delivery Processing (SAP S2,S8 ) Billing (SAP S2,S8 ) Opportunity Analysis (SAP S8 ) Contract Analysis (SAP S8 ) Sales Quotation and Order Analysis (SAP S8 ) Managing Catalog Content (SAP S8 )

Sales Planning and Account Management Terminal Management

Hydrocarbon Service Station Products Fuel Management Transportation

Convenience Retailing

SAP Product Available

SAP Product Available with Future Releases

Future Focus

Partner Product Available

Partner Product Available with Future Releases

SAP AG 2007, 10

Agenda SAP Oil and Gas solution map Components of Oil and Gas Common business process flows - Downstream Companies using SAP Oil and Gas How other oil companies are benefiting System walkthrough with some scenarios

SAP AG 2007, 11

High Level components of SAP Oil and Gas

SAP Oil and Gas- Production and Revenue Accounting (PRA)

SAP Oil and Gas- Remote Logistics Management (RLM)

SAP Oil and Gas Traders and Schedulers Workbench (TSW)

SAP Oil and Gas IS-Oil Downstream (IS-Oil)

SAP Oil and Gas- Service Station Retailing (SSR)

SAP AG 2007, 12

IS Oil Downstream

Hydrocarbon Products Management (HPM)

Tariffs, Duties and Permits (TDP)

Exchanges ( EXG)

Transportation and Distribution (TD)

Marketing, Accounting and Pricing (MAP)

Marketing, Contracts and Order Entry (MCOE)

Marketing Retail Network (MRN)

Bulk Distribution Requirement Planning (BDRP)

SAP AG 2007, 13

Hydrocarbon Products Management (HPM)

Oil specific data in the material master

Oil quantity conversion

Gas quantity conversion

Oil and gas quantity conversion in the Purchasing cycle

Oil and gas quantity conversion in the Sales cycle

Calculation of base quantities and water

Gains and losses in transfers

Silo Management

SAP AG 2007, 14

Tariffs, Duties and Permits (TDP)

Oil specific data in the material master

Excise duty processing within the sales and purchase cycle

Excise duty processing for inner-company goods movements (excise duty calculation for material that is moved between two plants with various tax rates).

Excise duty for production orders

Calculation and posting of excise duty liabilities and claims for goods movements of dutiable material.

The use of several excise duty rates for a material

The revaluation of inventories after excise duty rate changes

Licenses for excise duty (ED) reductions and exemptions

Split inventory management of the ED portion and the net price of a material

A data pool for creating reports

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Exchanges (1)

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Exchanges (2)

Exchange agreement with different oil companies

Exchange data flow

Terminalling for third party throughput

Logical Inventory Adjustment (LIA)

Netting

Fees

Quantity Schedule

Reporting and evaluations

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Transportation and Distribution (TD) (1)

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Transportation and Distribution (TD) (2)

Transportation and Distribution (TD) application area covers the logistics activities related to: Delivery of product from a delivering plant to a customer Transfer of product between two company-owned locations Receipt of purchased product from a vendor

These activities are carried out across the processes of scheduling, load confirmation, and delivery confirmation.

One of the most used features in the entire IS Oil suite

SAP AG 2007, 19

Transportation and Distribution (TD) (3)

Various elements of the TD application area are as follows :

Vehicles

Drivers

Rack Meters

Compatibility Checking

Shipment documents and shipment cost processing

Scheduling, loading confirmations and delivery confirmations

Transportation planning interfaces

Terminal automations system interfaces

Interface for delivery confirmation processing

Shipment planning workbench

SAP AG 2007, 20

Marketing, Accounting and Pricing (MAP)

Various elements of the MAP application area are as follows :

Contract pricing Cumulative contract call-off pricing Customer price lists Default pricing dates Head office and branch level pricing Location flexible pricing using the differential reference code (DRC) Time pricing Gross and net volume pricing Formula and average pricing Differential invoicing Origin, destination, and external data in the sales and purchasing cycle Conditional exclusion (highest prices) Alternative pricing date at invoicing External quotation invoice Five-decimal pricing Additional material data in an invoice

SAP AG 2007, 21

Marketing, Contracts and Order Entry (MCOE) (1)

SAP AG 2007, 22

Marketing, Contracts and Order Entry (MCOE) (2)

Various elements of the MCOE application area are as follows :

IS Oil Fast Order Entry

Organizational data as a default partner function

Contact person details

Item category re determination

Automatic Plant determination

Excise duty

Restrictions for contract call offs

Final Delivery indicator

SAP AG 2007, 23

Agenda SAP Oil and Gas solution map Components of Oil and Gas Common business process flows - Downstream Companies using SAP Oil and Gas How other oil companies are benefiting System walkthrough with some scenarios

SAP AG 2007, 24

Downstream process dispatch of oil products from depot

Sales order is created for a customer- credit or cash sales

Delivery order is created for the sales order

Creation of an IS- Oil TD shipment

Loading of product in the tanker in various compartments

Delivery at customer location and delivery confirmation of the actual quantity delivered

Updates in the SAP system during all the transactions

SAP AG 2007, 25

Process Step 1: Creation of a sales order

SAP AG 2007, 26

Process Step 2: Checking status of sales order

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Process Step 3: Stock overview prior to delivery

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Process Step 4: Creation of a delivery

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Process Step 5: Creation of a shipment

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Process Step 6: Compartment planning for truck

SAP AG 2007, 31

Process Step 7: Start of loading confirmation

SAP AG 2007, 32

Process Step 8: Start of loading confirmation

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Process Step 9: Oil quantity calculations quantity conversions

SAP AG 2007, 34

Process Step 10: Confirmation of loading on truck

SAP AG 2007, 35

Process Step 11: Stock overview (in transit)

SAP AG 2007, 36

Process Step 12: Status of delivery after loading confirmation

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Process Step 13: Documents created in the system

SAP AG 2007, 38

Process Step 14: Confirmation of delivery to customer

SAP AG 2007, 39

Process Step 15: Status of shipment after Confirmation of delivery to customer

SAP AG 2007, 40

Process Step 16: Tracking of delivery status

SAP AG 2007, 41

Process Step 17: Material documents after delivery confirmation

SAP AG 2007, 42

Process Step 18: Accounting documents after delivery confirmation

SAP AG 2007, 43

Agenda SAP Oil and Gas solution map Components of Oil and Gas Common business process flows - Downstream Companies using SAP Oil and Gas How other oil companies are benefiting System walkthrough with some scenarios

SAP AG 2007, 44

References

SAP AG 2007, 45

Case Study- Reliance Industries

Reliance is the first private sector IndianFortune Global 500 company The Group's activities span exploration and production (E&P) of oil and gas, refining and marketing, petrochemicals (polyester, polymers, and intermediates), textiles, financial services and insurance, power, telecom and infocomm Group turnover exceeds US $ 22 bn Reliance Group revenue is equivalent to about 3.5% of India's GDP RIL is the largest exploration acreage holder among the private sector companies in India with 30 domestic exploration blocks covering an area of about 300,000 sq km The Company has the worlds largest grass root refinery in the world with an installed capacity of 33 million tonnes of crude processing capability There are 23 Terminals with presence all across India for distribution of petro-products all over India Over 2000 retail outlets all over India currently

SAP AG 2007, 46

Case Study- Reliance Industries Implementation

First Implementation for Refinery Business in February 1999

Implementation started during the construction phase of the

refinery and Go live coincided with the going live of refining

operations

Currently live at over 200 locations within and outside the

country

Dedicated SAP core group of around 200+ team members

More than 700 man years of SAP implementation experience Oil & Gas ( using IS Oil) Insurance ( Using IS Insurance) Petrochemicals Telecom Power Life Sciences

Expertise in major Industry verticals

SAP AG 2007, 47

Agenda SAP Oil and Gas solution map Components of Oil and Gas Common business process flows - Downstream Companies using SAP Oil and Gas How other oil companies are benefiting System walkthrough with some scenarios

SAP AG 2007, 48

Business Objectives
Business Objectives:
Improving Regulatory Compliance Improved transparency and auditability of activities Reduce risks of fines and penalties Increase Speed & Efficiency Automate - eliminate errors due to manual processes Increasing Transparency & Accountability Increase data transparency Reducing Operating Costs & Increasing Efficiency Reduce administration, improve business processes Improving Service Delivery Faster access to relevant information Increase Speed & Efficiency Automate - eliminate errors due to manual processes Increasing Transparency & Accountability Improve transparency and auditability of activities Reducing Operating Costs & Increasing Efficiency Automation and standardization of business processes Reduce transaction costs

Scenario:

Allocation and Settlement

Bulk Supply Chain Execution and Settlement

SAP AG 2007, 49

Business Objectives
Business Objectives:
Increasing Revenue Improve capacity utilization Increasing Transparency & Accountability Increase data transparency Provide decision support Reducing Operating Costs & Increasing Efficiency Automation and standardization of business processes Lower logistics costs Increase Speed & Efficiency Increase collaboration (internally & externally Increasing Revenue Improve capacity utilization Lowering Working Capital Shorten order-to-cash cycle Reducing Operating Costs & Increasing Efficiency Lower logistics costs Reduce inventory levels Improving Corporate Strategy Definition and monitoring of a set of targets for business activities Increasing Transparency & Accountability Provide decision support

Scenario:

Bulk Supply Chain Operations and Scheduling

Bulk Supply Chain Planning and Optimization

Bulk Supply Chain Reporting and Analytics

SAP AG 2007, 50

Business Objectives
Business Objectives:
Improving Customer Service Improve service quality Increasing Revenue Efficient campaign planning and management Improve customer retention and loyalty Lowering Working Capital Reduce out-of-stock situation Reducing Operating Costs & Increasing Efficiency Automation and standardization of business processes Improving Customer Service 24x7 customer self-service Better service levels Complaint management and tracking Improve service quality Provide a single face to the customer

Scenario:

Convenience Retailing

Customer Service

SAP AG 2007, 51

Business Objectives
Business Objectives:
Improving Customer Service Collaborate with business partners Improving Regulatory Compliance Comply with future accounting and regulatory reporting requirements Increase Speed & Efficiency Automate - eliminate errors due to manual processes Increasing Security Improve document control, integrity and retention Reducing Operating Costs & Increasing Efficiency Improve accounting processes Improving Corporate Strategy Capital budgeting and allocation process Support for the strategic planning process Increase Speed & Efficiency Increase collaboration (internally & externally Increasing Revenue Develop new markets Increasing Transparency & Accountability Accurately calculate project risks

Scenario:

E&P Contract Management

Exploration and Appraisal

SAP AG 2007, 52

Business Objectives
Business Objectives:
Improving Service Delivery Faster access to relevant information Increasing Transparency & Accountability Increase data transparency Reducing Operating Costs & Increasing Efficiency Automation and standardization of business processes Lower logistics costs Integrate processes across divisions and functions Managing Fixed Assets & Resources Minimize investment in operating facilities Improve physical inventory process Improve return-on-investment (ROI) of fixed assets Optimize capital equipment and asset utilization Reducing Operating Costs & Increasing Efficiency Reduce transaction costs Lower communications expenses Reduce administration, improve business processes

Scenario:

Hydrocarbon Products Transportation

Investment Planning, Design & Construction

SAP AG 2007, 53

Business Objectives
Business Objectives:
Improving Corporate Strategy Production Growth Improving Regulatory Compliance New business opportunities - participate in cutting edge "green tags" or "carbon credits" market Increasing Transparency & Accountability Improvement of regulatory compliance Lowering Working Capital Improve capacity utilization Reducing Operating Costs & Increasing Efficiency Improve asset and maintenance management Increase Speed & Efficiency Speed innovative products / designs to market Increasing Revenue Improve capacity utilization Maximize profitability by product Lowering Working Capital Increase inventory turns Reducing Operating Costs & Increasing Efficiency Automation and standardization of business processes

Scenario:

Liquid and Gas Production

Lubes Manufacturing Operations

SAP AG 2007, 54

Business Objectives
Business Objectives:
Managing Fixed Assets & Resources Optimize capital equipment and asset utilization Reduce down-time Reducing Operating Costs & Increasing Efficiency Improve procurement processes Increasing Revenue Efficient campaign planning and management Extend market share Improve customer retention and loyalty Maximize profitability by customer Develop new markets Improving Regulatory Compliance Comply with future accounting and regulatory reporting requirements Reduce risks by permanent compliance tracking with internal and external regulations Increasing Transparency & Accountability Improve transparency and auditability of activities Support risk management Reducing Operating Costs & Increasing Efficiency Removing maintenance of interfaces (Financial Accounting, Cash Management and Risk Management)

Scenario:

Maintenance Operations and Logistics

Marketing Planning and Execution

Oil and Gas Paper Trading and Risk Management

SAP AG 2007, 55

Business Objectives
Business Objectives:
Improving Customer Service Increase multi-channel delivery of services Increasing Revenue Enable cross-sell/up-sell capability Lowering Working Capital Shorten order-to-cash cycle Reducing Operating Costs & Increasing Efficiency Automation and standardization of business processes Re-deploy labor to higher value-added activities Reduce order processing costs Improving Corporate Strategy Support for the strategic planning process Increasing Revenue Maximize profitability by customer Maximize profitability by product Reducing Operating Costs & Increasing Efficiency Automation and standardization of business processes Improve inventory visibility

Scenario:

Opportunity to Cash

Physical Oil and Gas Commodity Trading

SAP AG 2007, 56

Business Objectives
Business Objectives:
Improving Regulatory Compliance Improve manufacturing plant operations by optimizing operating conditions against permit constraints Increasing Revenue Improve capacity utilization Managing Fixed Assets & Resources Reduce down-time Reducing Operating Costs & Increasing Efficiency Improve inventory visibility Reduction of costs for integration with Accounting and Finance Management Improving Customer Service Strengthen partnerships and account management Improve forecast accuracy Increasing Revenue Efficient sales planning and management Improve customer retention and loyalty Maximize profitability by customer

Scenario:

Refining Operations

Sales Planning and Account Management

SAP AG 2007, 57

Business Objectives
Business Objectives:
Improving Regulatory Compliance Reduce risks of fines and penalties Comply with future regulatory reporting requirements Lowering Working Capital Reduce out-of-stock situation Managing Fixed Assets & Resources Improve physical inventory process Reducing Operating Costs & Increasing Efficiency Automation and standardization of business processes Reduction of costs for integration with Accounting and Finance Management Improving Service Delivery Reduce administration, improve business processes Increasing Revenue Improve customer retention and loyalty Reducing Operating Costs & Increasing Efficiency Reduce transaction costs Reduce inventory levels

Scenario:

Service Station Fuel Management

Sourcing & Procurement

SAP AG 2007, 58

Business Objectives
Business Objectives:
Improving Service Delivery Collaborate with business partners Improved quality and accuracy Increase Speed & Efficiency Automate - eliminate errors due to manual processes Lowering Working Capital Reduce out-of-stock situation Reducing Operating Costs & Increasing Efficiency Improve inventory visibility

Scenario:

Terminal Management

SAP AG 2007, 59

Key Performance Indicators

Key Performance Indicators:
Earnings Before Depreciation, Interest, And Tax Capacity Utilization Netback value Distribution Costs Forecast Accuracy Inventory accuracy Delivery Performance to Scheduled Commit Date Cost of Goods Sold Detailed Schedule Creation Time Distribution Costs Inventory accuracy Delivery Performance to Scheduled Commit Date Cost of Goods Sold Capacity Utilization Inventory Carrying Costs Total Supply Chain Costs Number of Orders without Complete and Accurate Documentation Operating Cash Flow Days Of Sales In Backlog Customer Invoicing, Accounting Costs Inventory Carrying Costs

Scenario:

Allocation and Settlement

Bulk Supply Chain Execution and Settlement

Bulk Supply Chain Operations and Scheduling

Bulk Supply Chain Planning and Optimization

Bulk Supply Chain Reporting and Analytics

SAP AG 2007, 60

Key Performance Indicators

Key Performance Indicators:
Cash Flow Economic Profit - Capital Charge Internal Rate Of Return Finding & Development costs Reserves replacement ratio Administration Costs Reductions Customer Invoicing, Accounting Costs Cycle Time: Inquiry to Contract Fast close support Faultless Invoices Number of Callbacks as % of total inquiries Percentage of Customer Complaints Percentage of Customers getting served via Internet Protocol Percentage of Service Requests Customer Satisfaction Index Customer Satisfaction Index Operating Expenses Headcount Supplier on time Delivery Performance Inventory accuracy

Scenario:

Convenience Retailing

Customer Service

E&P Contract Management

Exploration and Appraisal

SAP AG 2007, 61

Key Performance Indicators

Key Performance Indicators:
Rate Of Return On Capital Material Management and Planning Costs Return On Capital Employed Lost Time Incident Ratio Lifting Costs Production Stoppage Hazardous Materials Emissions Delivery Date Accuracy Delivery Performance to Customer Request Date Distribution Costs Order Fulfillment Costs Perfect Order Fulfillment

Scenario:

Hydrocarbon Products Transportation

Investment Planning, Design & Construction

Liquid and Gas Production

Lubes Manufacturing Operations

Average Development Cost per New Product Number of End Products,SKUs Time to Market Campaign/Event Cost Revenue Ratio Contact Efficiency Percent of New Customers per Year Percent Revenue Growth Existing Customers

Marketing Planning and Execution

Oil and Gas Paper Trading and Risk Management

Operating Cash Flow Inventory Carrying Costs

SAP AG 2007, 62

Key Performance Indicators

Key Performance Indicators:
Cost of Goods Sold Operating Cash Flow Operating Revenue Margin Operating Revenue Margin Average Inventory Return On Capital Employed Material Stock shortfalls Revenue Revenue Per Full-Time Equivalent Employee Sales Selling Expenses Contract Negotiation Time Customer Satisfaction Index Sales Cycle Time (Orders) Cycle Time: Inquiry to Contract Order Fulfillment Costs Invoice Accuracy Rate Order Receipt to Order Entry Complete Time

Scenario:

Opportunity to Cash

Physical Oil and Gas Commodity Trading

Refining Operations

Sales Planning and Account Management

Service Station Fuel Management

Contribution Margin Rate Gross Profit Inventory Turnover

SAP AG 2007, 63

Key Performance Indicators

Key Performance Indicators:
Inventory Inventory accuracy Inventory Days of Supply (Quantity) Shrinkage

Scenario:

Terminal Management

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Roadmap for one of the countries

Restructure along SBUs Focus and Accountability Continuous monitoring Objectives & Measurement Mechanisms

Adapt, Change and Learn

Requires Information Technology Embedded into Business Processes

Therefore, an Information Systems Planning project was started as part of the Change Plan implementation in August 1997 to arrive at the long term IT Strategy for the oil company resulting in.

SAP AG 2007, 65

 a complete solution map

Time and Time and Attendance Attendance capturing capturing CAD/CAM CAD/CAM E-mail E-mail

Document Document Management Management System System

Internet, Internet, Intranet& Intranet& Extranet Extranet

EDI EDI (Electronic (Electronic Data Data Interchange) Interchange)

Core System
Service Service Project Mgmt. Project Mgmt. Maintenance Maintenance Human Resources

Optimisation Optimisation solutions solutions

Excise/ Excise/ Customs & Customs & Statutory Statutory Reqmt. Reqmt. MIS MIS

Bar Bar Code/Labels Code/Labels

Payroll Payroll Transportation Transportation

Materials Mgmt. Materials Mgmt. Procurement Procurement Inventory Inventory Quality Quality Contract Contract Management Management

Manufacturing Manufacturing Execution Execution Systems Systems in in Refinery Refinery

Health, Safety Health, Safety and and Environment Environment Production Production Planning Planning

Financial Financial GL GL AP & AR AP & AR Costing Costing Fixed Assets Fixed Assets

Sales and Sales and Distribution Distribution Order Entry Order Entry Shipping Shipping Billing Billing Sales Analysis Sales Analysis Pricing and Pricing and Commissions Commissions

Sales Process Sales Process Automation Automation E Commerce

Terminal Terminal Automation Automation

LPG consumer Accounting

Data Data Warehouse Warehouse

SAP AG 2007, 66

Agenda SAP Oil and Gas solution map Components of Oil and Gas Common business process flows - Downstream Companies using SAP Oil and Gas How other oil companies are benefiting System walkthrough with some scenarios

SAP AG 2007, 67

SAP AG 2007, 68