Part 3- Benefits of a Unified Liquids Management Solution
I am bringing this series on digital transformation in the liquids transportation sector to a close. So far, I have provided the backstory on why the crude oil, NGL, and refined products transportation market is undergoing rapid change and how midstream service providers are responding. Topics covered have included how digital transformation is helping service providers manage growth and stay competitive as well as why companies are trending away from internally developed liquids transportation solutions to software products backed by technology partnerships.
In this third and final topic in the series, I would like to broaden the discussion from liquids transportation to the larger picture of liquids management and the complex business of moving, storing, and processing hydrocarbons. With all the moving parts to liquids management, midstream companies who make the move to a unified solution purpose-built on the cloud can reap savings and efficiencies. Everything from a lower total cost of owning software, faster processing times, and a new paradigm in user experience awaits those companies who switch to a unified, cloud-based solution for their business.
Running Midstream Operations on the Cloud
There are several liquids transportation software packages on the market, however, they tend to be built on legacy technology. This means that complex settlement calculations and allocations can take hours and often require processes to be rerun several times. Also, legacy solutions provide limited visibility into how those calculations are performed creating a black box that injects uncertainty into financial results.
Midstream companies are seeking innovative solutions that deliver high performance, confidence in data, and cost-efficiency. More importantly, they are also looking for technology partners. The legacy of rigid software restrictions continues even in some newer liquids transportation solutions. As software vendors overpromise on what they can deliver, slow development turnaround, lagging performance, and black box data issues persist.
Midstream service companies are increasingly adopting W Energy Software, not just to manage the complex business of liquids transportation, but to manage the entire midstream value chain. W Energy Software is deployed at over 100 liquids management facilities and supports the movement of 1 billion barrels of crude and refined products per month.
Benefits of W Energy Software compared to homegrown and legacy software providers include:
- Unified platform – Complete software suite for midstream companies – from modules to manage gathering, processing, storage, and transportation of liquids to right of way and complete financial accounting solutions – eliminates juggling various applications and accelerates business performance.
- Cloud-hosted – Eliminates the need to manage on-premise server software, provides on-demand computing and elastic storage (scale up or down and pay for what you use), and gives users access from their device of choice.
- Fast processing – Software is architected from the ground up to take full advantage of the cloud, enabling settlement, allocations, and other complex calculations to be processed in seconds rather than hours.
- Economy of scale – “Pay as you go” subscription pricing dramatically reduces costs by eliminating the need to buy hardware and reducing administrative costs for maintaining legacy solutions.
- Confidence in data – Complete data visibility and transparency into how calculations are performed with audit trails and tools to backtrace revenue at every stage.
The Bottom Line for Service Providers
Cost-efficiency, elimination of data silos, performance, and the ability to seamlessly integrate applications and workflows are driving midstream companies to the cloud. As an example, following an overall trend in the Permian Basin, one of the largest midstream transportation and processing service providers in the country has recently expanded its Texas-based NGL hub with additional fractionation capacity, storage, and pipeline infrastructure. Transitioning from a long-standing internally developed solution, the company has deployed W Energy Software’s Liquids Transportation and Terminal Management software. Leveraging a unified application and data architecture, the midstream service provider gains the unprecedented ability to track the accounting movement of hundreds of daily NGL shipments through its facility and manage terminal operations, all in one cloud-based solution. A significant upshot is that the service provider can now pass on these system-gained operational and cost efficiencies to their customers, providing higher value on each transaction and helping it compete in the largest energy market in the country.
As midstream continues to expand, digital transformation is essential to navigate growing information complexities, provide the agility service providers need, and create new cost efficiencies. And increasingly, the catalyst for that digital transformation is the cloud and innovators like W Energy Software.
If you have been following this blog series and have had any questions along the way, please feel free to reach out to me or the W Energy Software team for expert advice on modernizing your liquids management with our cloud-based solutions. We look forward to hearing from you.
This is part 3 of our blog series, 3 Trends in Digital Pipeline Innovation: Liquids Management Simplified. To read part 1, click here.
Author: Michael Ferrante, VP of Transportation
Michael earned a B.S. in business administration from Oklahoma State University. Since joining our team, he has helped build various modules within our software, ranging from marketing to gas balancing to land administration. Michael has lead implementation projects in many business areas of the industry and is currently focused on expanding the Transportation practice area with new pipeline and terminal clients.