Executives in the oil and gas industry today face some unique challenges, including a competitive landscape, compliance and regulatory pressures, and the need to monitor complex land and exploration agreements. To provide strategic leadership, executives must maintain a real-time, informed and comprehensive view into the daily operations of their company. There are key performance indicators (KPIs) that can help spotlight the benchmarks being reviewed. The review of these KPIs can drive operational decision-making and influence the bottom line. A system for easily monitoring them on a real-time basis helps executives make the kinds of informed decisions that enhance productivity and cut costs. Visibility into three key business areas-accounting, land and operations-provide executives with current, business-critical information to proactively and effectively stay abreast of complex day-to-day requirements of their business and react quickly. Real-time, comprehensive, at-a-glance access to this information provides the edge that is needed to stay competitive. Following are the KPIs for the oil and gas producer. Lifting costs. One of the fundamental performance indicators is lifting costs per barrel of oil equivalent (BOE), demonstrating the extent to which a company is controlling operating costs. The basic formula for calculating lifting costs is annual lifting costs divided by annual production in BOE. Additionally it can reveal how efficient a company is at getting product out of the ground. Since budget anticipated lifting costs as they evaluate acquisitions and drilling investments, it is imperative that the costs be monitored and appropriate adjustments be taken if costs get out of line. Lifting cost is also a metric used in peer comparisons. For more on this, see the May issue of Oil and Gas Investor. For a subscription, call 713-260-6441.

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