There are several reasons that explain why the monthly sales allocations are generally more reliable than corresponding daily pipeline numbers. Monthly allocations are performed by a comprehensive production accounting system, using more precise measurement of volumes and composition. Further, the monthly production accounting data and system is subject to audit by producers and regulatory agencies, whereas the daily process is often considered ‘just an estimate’ that does not warrant the rigor. However, imprecise daily sales contract allocations are costly and inconvenient for product owners, marketers, and facility operators. We recently spoke with the head of volume accounting at a large North American mid-stream organization on this topic. Her view clearly supports the position that the daily process deserves more attention, and that the investment can deliver impressive returns. A solution that brings the summarized daily and monthly product sales into closer alignment provides substantial benefits to all stakeholders, not least of which is the quality of service and credibility attributed to the common stream operator.
Commercial internet and data integration technology holds promise of delivering economical solutions for facility operators looking to improve the quality of their daily sales allocations reported to the pipelines. There has been successful experience documented by a few plant operators that have:
- standardized the collection and validation of measurement data to simplify the capture process for field and plant operators
- made strides in helping to streamline the producer’s task of delivering reliable daily volumes to the CSO
- utilized a subset of the monthly production accounting data structure to drive the daily process
- tailored the daily processes at each facility to meet the unique requirements of the facility
- provided the plant administrators with the tools to analyze and verify allocation data before reporting to the pipeline
- made daily production history available as a guide to forecast what to expect from producers, and provided analytical tools to operations staff to monitor shrinkage, fuel, flare, vent and production loss.
These improvements are available to any facility operator having a reliable internet connection and willing to invest in the implementation of the updated processes. System integration tools are available to take advantage of the production configuration data already being maintained, so that the daily allocation update incurs little overhead. Fortunately, most people are familiar with current internet capability, resulting in a solution that is easily implemented and accepted by plant and field operators.
Contact us if you would like to obtain a case study on the Southern Union experience.
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