Table of Contents
Acknowledgments ix
Abstract x
Chapter 1 Introduction 1
A Vital Industry 2
What Now? 3
Industry Evolution 6
Ten Reasons to Update Your Operating Model 9
E&P Needs a New Agenda 19
Notes 20
Chapter 2 The New Agenda 23
Upstream Cost Transformation 24
“Cut Costs and Grow Stronger” 30
E&P Capabilities 34
Resource-Based Key Capabilities 45
Notes 49
Chapter 3 E&P Operating Model Redesign 51
Internal Operating Model 55
Business Delineation and Performance Measurement 56
Organization Structure, Capabilities, and Workflows 66
Operations Management Processes 74
Delegation of Decision Rights 75
Informal Social Norms and Corporate Culture 77
Implications of Industry Evolution 80
Business Model Considerations 83
Notes 85
Chapter 4 PMI and Other Event-Driven Redesigns 87
The Search for a Perfect Ownership Model 89
Preparing to Go Public 91
Key Success Factors 92
Event-Driven Redesign 94
Note 95
Chapter 5 National Oil Company Considerations 97
National Oil Company Context 98
Sovereign and National Oil Company Strategies 103
Business Model Implications 109
Notes 114
Chapter 6 Collaborative Operating Models 117
Who Uses Joint Ventures? 118
Joint Venture Strategic Intent 122
Joint Venture Value and Valuation 124
Deal Structure 127
Joint Ventures in Practice—The “How” 132
Notes 141
Chapter 7 Financial Implications 143
Financial Strategy and Policy 145
Hedging and Trading 155
Notes 168
Glossary of Terms 171
Other Useful Links 171
Works Cited 172
About the Author 178
Index 179