The Lay of the Land
Return on iLandMan (ROI)
Louisiana Broker Reduces Cost to Client and Improves Brokerage Bottom Line: Lease Objectives Accomplished with 100 Crew Members Instead of 150
Within 20 months, Louisiana Oil Group (LOG) accomplished a 300,000 acre lease acquisition project, and saved their E&P client approximately $10 MM in lease acquisition costs leveraging the efficiencies iLandMan brings to bear on a project.
Uniformity Equals Efficiencies
Roland Dugas, Partner with LOG, explains his firm has a bit of a benevolent mandate for their crews. “When we hire people we explain this system is part of the job to help us work more efficiently because we want people to have the freedom to get their work done with limited supervision. We are confident LOG has among the most competent landmen in the industry because they not only understand land work, but they are able to utilize a system that allows us to save money for our clients on lease acquisition.” In the last 20 months, LOG calculates they have saved their current clients over $500,000 a month in broker costs due to their use of technology. Clients recognize LOG’s investment and preference to work more efficiently because it comes up in client management meetings. How long before this technology becomes the standard?
Industry Firsts which are Standard Features in iLandMan:
– Real-time, GIS and Mapping Layers
– Platform neutral, front-end to any back office system
– Weekly version updates uploaded at no additional cost to clients
Real-time Maps. Real-time Decisions.
Mr. Dugas at LOG elaborates further about the autonomy this technology provides their crew and some of the benefits clients see with real-time mapping. “We like being able to bring our client in with our leasing crew and our title crew so we can all focus on the project visually. We can turn on a lease layer; we can turn on an overlay of all the wells. In one of our prospects, we downloaded all wells drilled into our map for the entire State we were working. Within the database that generates the map we are provided a link, and from this we can get information on any well immediately as the link connects us directly to the well file in the records for the Department of Conservation. This has been extremely helpful because we didn’t have to get out of the system and go into the State’s database. We can just select the link and it automatically pulls up that current well file as it exists today. The other nice thing about the map is that well status and well information is changing everyday on our entire prospect, but everyone authorized on the project has access to this information in real time. Without this convergence of information, our crew would have to go into the state’s web site and pull up a map and then convert it onto the prospect map on a weekly, daily, hourly basis. The time savings is significant. In this case, when we pull up our map and we open the layer to the web to put in our wells, the well status automatically shows up on our map in real time. This is important because the status of the well can change daily.
The well status may be permitted, it could be producing, or it may be plugged and abandoned, or any number of circumstances which affect our decision-making. We can change and configure the (mineral) lease legend of the map on our own as the need arises. All of this matters for now we can have it in real time, not just for those of us in management, it’s available to my entire crew 24 hours a day no matter when they want to work. The workflow makes us highly efficient from management throughout the activities of the crew.”
Business Sense. From the Field to Management.
In LOG’s most recent project, management contends they accomplished their client’s lease objectives with one-third fewer people than would have been required without the technology —100 people instead of 150. Dugas continues, “Sure, the way we work reduces our top line, but it improves our bottom line by alleviating our administrative burden. We would have to hire 4 or 5 more administrative people to manage an additional 50 crew members. To my partners and I, our approach makes the best business sense.”
These land executives are making great strides on behalf of their E&P clients’ because they are choosing to work differently, and it is yielding dramatic improvements in profitability and productivity as oil and gas firms are as much in the business of managing assets for their undrilled acreage as they are for what they intend to produce.
LOG Partners include Roland Dugas, III, Parker Yelverton, CPL, and Chip Clark, CPL.
The Past and How a Better Way Emerged: By Richard Hines, Vice President/Partner
Gone are the days of waiting for our local oil and gas attorney or lease administration department to send us the breakdown of interest on our producing or prospective producing unit. The Division of Interest or Royalty Division Order (RDO) as it is known is the basis of all oil and gas production revenue and distribution.
From Horror to Helpful
As the iLandMan team was working with our broker and company (E&P) clients, we kept hearing the horror stories as well as the sheer panic when the NRI’s were not acceptable or an answer was needed the next day for that all important meeting. Those all nighters were not only squeezing the life out of the land professionals trying to produce accurate divisions of interest but also making life for the company presenters miserable.
Multiple Days to Minutes
We saw a large workflow gap that needed filling especially in the area of determining the correct acreage and what both the mineral and working interest parties owned. So, we redefined the work process, as well as, we gave people the ability to run RDO calculations from their tract ownership, lease ownership and unit information by simply entering the correct data for the unit, and pushing a button. With this breakthrough, multiple days of organizing, calculating and reporting were eliminated. A process was created so all parties can automatically evaluate their unit tract ownership data and determine what is missing or needs to be added so it is ready for submittal to accounting, legal, etc.
Front-end Fuels Back Office
What was once only produced from back office accounting modules (after the fact) is now available to any of the field or office staff through the iLandMan RDO module. iLandMan can serve as a platform neutral front-end to any back office system. This powerful tool now gives the staff or management the ability to review the outcome before actually creating the final unit. We now can take a defined boundary such as a unit on the iLandMan map and determine the RDO from this outline.
Today we can create the producing area outline geographically, geologically, vertically or arbitrarily, and still get the interest break down in a matter of seconds. Sound too good to be true? With iLandMan it is a reality. Once again, what we learned from our clients and how something was historically done allowed us to make a significant leap in productivity with our unique software solution. What was once a time consuming and arduous task is now simplified and gives people an automatic result that is verifiable, truly amazing.
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