Midstream ERP
Case Study

H2O MIDSTREAM RESOURCES

W Energy Software’s Financial Accounting, Liquids Transportation, and Transaction Management Solution Helps H2O Midstream Sustain Growth Profile in the Permian Basin

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Barrels per Day Takeaway Capacity
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Mile of Pipeline
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Meters
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AP Invoices Processed Monthly

Inspiration for Change

ACCELERATING DEMAND FOR THIRD-PARTY WATER MANAGEMENT 

Between 3 to 10 barrels of water are produced for every barrel of oil in the Permian Basin. Many operators are transitioning away from managing their own produced water to third-party service providers who offer economies of scale and cost-sharing among producers. H2O Midstream is a recently founded water management startup that is experiencing rapid growth in this large market. It owns and operates integrated produced water infrastructure consisting of a 190-mile, 435,000 bpd capacity system in the Midland Basin and a 150-mile, 500,000 bpd system in the Delaware Basin (via joint venture).

MAINTAINING BUSINESS AGILITY 

Within a short time, frame H2O Midstream’s accounting requirements grew increasingly complex as its customer contracts expanded across the Permian. At the same time, the company had expanded its water management infrastructure through acquisition in the Midland Basin and a joint venture in the Delaware Basin. As a result, H2O Midstream needed to track a growing number of meters and transactions spanning hundreds of miles of gathering and transportation pipelines.

SCALING TO MEET CUSTOMER NEEDS

With increasing customer demand H2O Midstream needed to scale its accounting operations beyond the capabilities of its existing financial software solutions, which included QuickBooks and a variety of Excel-based workflows. The service provider wanted to accelerate monthly settlement and streamline customer invoicing.

Faced with mounting contracts and the need for customers to efficiently nominate shipments, H2O Midstream also wanted to provide shippers with self-service capabilities to manage their inventory and nominations. Additionally, the service provider needed to anticipate water infrastructure build-out and secure acreage for pipelines in areas of the Permian under development to ensure takeaway capacity matches customer needs.

BENEFITS OF W ENERGY SOFTWARE

POSITIONED FOR GROWTH

After evaluating multiple ERP and accounting solutions, H2O Midstream selected W Energy Software’s Liquids Transportation, and full Midstream ERP suite, which consists of software modules for Financial Accounting (AP, AR, financial statements), Purchasing, Fixed Assets, and Purchasing. To assist with the management of shipper nominations, it selected W Energy Software’s Customer Activity Website (CAW) to provide customers with self-service tools for tracking inventory, nominations, and confirmations. H2O Midstream also chose the W Energy Software Right of Way solution for managing land-related workflows and leases ahead of planned infrastructure.

H2O Midstream implemented W Energy Software solutions with EAG 1Source, a W Energy Software implementation partner.

MEETING CUSTOMER NEEDS HEAD ON

H2O Midstream reports that by deploying W Energy Software in support of its accounting operations it now has the technology and systems in place to sustain its aggressive growth profile and meet evolving customer needs. W Energy Software’s Liquids Transportation solution enables the service provider to track complex customer contracts (including rates and escalations), automatically aggregate and validate measurement data from 250 meters, and accurately record transactions across its extensive produced water pipeline systems in the Permian Basin. And equipped with W Energy Software’s Calculation Trace (CalcTrace) feature, accounting staff now have a powerful auditing capability to backtrace revenue through every preceding transaction and calculation.

POWERING BEST-IN-CLASS OPERATIONS

W Energy Software is enabling H2O Midstream to close its month faster than ever by cutting settlement time in half.

The preparation of financial statements, which previously required 3 days, is now performed in a couple of hours. W Energy Software provides centralized management of core financial data required to generate customer invoices, create purchase orders, and process accounts payable invoices. And because W Energy Software’s Financial Accounting and Liquids Transportation solutions are fully integrated on the cloud, H2O Midstream’s staff no longer have to wait until the books are closed to see financial results but can see results as soon as entries are posted with the ability to digitally attach supporting documents to journal entries. By accelerating accounting cycle times and automating manual processes, the service provider is empowering its workforce to spend more time on high-value tasks and analysis.

Ready For the Future?