E&P Company Standardizes AFE Process with Custom Workflow Automation and ECM Solution

Stonebridge was engaged by an independent E&P company to develop a workflow-automation and content management solution for streamlining its AFE processes. The company has embarked on an aggressive drilling program that leadership conservatively estimated would result in the drilling of thousands of wells over the next three years.

To handle the expanding drilling, the company had instituted policies that compel its asset teams to follow an extensive and complex process for AFE (Authorization For Expenditure) approval. An essential budgetary document in the O&G business, an AFE lists the estimated expenses associated with well operations: drilling, land leases, seismic data, workovers, recompletions, etc. Every project involving a capital expenditure generates an AFE, and this estimate of expenses, which can represent millions of dollars, is provided to partners for approval prior to commencement of the project. For an operating company, the approval process is typically complex and multifaceted, with the AFE moving through various layers within the asset team and operating partners before it ultimately crosses the CEO’s desk for final approval. Along the way, a wide variety of documentation is attached to the AFE: Word documents, Excel spreadsheets, images, spreadsheets, additional commentary, etc.

The failure to approve an AFE on a timely basis can result in a costly delay or cancellation of a project. In this company’s case, the existing AFE approval process was paper-intensive and largely manual, and was already creating decision bottlenecks and increasing project costs. Further, faced with the prospect of drilling thousands of new wells and the added strain on its already overtaxed AFE processes, the company realized it needed to resolve its AFE problem at the enterprise level. After evaluating a number of off-the-shelf software packages for AFE workflow, the company’s CIO determined that none met their unique business need for a complete and fully integrated business solution that provided an easy-to-navigate user interface, workflow automation and process tracking, and document management capabilities. The company selected Stonebridge to help it build a custom AFE solution that leveraged existing technology investments. Prior, the customer had engaged Stonebridge to implement the content management system based on the ECM application suite of a third-party software vendor. In particular, this existing ECM application played a key role in building the company’s AFE solution.

Stonebridge designed, developed, and implemented a custom workflow-based solution for the AFE process, including approvals, status tracking, annotations, and archival of artifacts and documents. The solution has three core components:

• Custom User Interface – Using Microsoft’s .NET framework, Stonebridge created a highly graphical, intuitive user interface that is easy to use by the wide range of participants actively engaged in the AFE process, from geologists and drilling engineers to executive management.
• Workflow Automation and Process Tracking – Leveraging the client’s existing investment in ECM software, Stonebridge used the application’s native workflow engine to develop automated workflows for the client’s defined AFE processes, such as drilling, lease operations, seismic, and workovers/recompletions, and associated the workflows with specific asset teams. Each unique AFE-specific workflow described the tasks, expense thresholds, procedural steps, required documentation, authorizations, and people involved. The workflow engine has a tracking mechanism that precisely tracks the progress of a specific AFE, which increases overall process efficiency and accountability and enables management to quickly pinpoint exactly where a specific AFE is in its approval process.  
• Document Management – Using the ECM system as the central repository for all AFE documentation, Stonebridge integrated a document transformation application from Adlib Software that instantly converts AFE-related artifacts – seismic reports, Word documents, Excel spreadsheets .tif files, etc. – into a single PDF file. The system automatically updates the master PDF file each time a new artifact is attached to the AFE. Once the AFE workflow is complete, the PDF is automatically stored within the ECM repository and placed in its associated well file.

Solution Benefits:

• Tracks each AFE through its life cycle, increasing the reliability of the process
• Improves AFE approval turnaround time by 30%
• Establishes a standard company-wide AFE approval process for all capital expenditures