Jones Energy Inc. (NYSE: JONE) is an independent oil and gas company operating in the U.S. Mid-Continent. The company owns both operated and non-operated wells in the Anadarko and Arkoma basins of Texas and Oklahoma and holds proved reserves of more than 115 MMBoe.
Among its peers in the Cleveland Basin, Jones Energy leads the way in maximizing ROI, with an operations philosophy aimed at minimizing costs while optimizing operational efficiency. The company is always on the search for innovative ways to strengthen its financial position.
Jones Energy places a priority on making decisions based on sound data to deliver a quicker ROI. However, they were consistently challenged with managing structured and unstructured data sets related to leases and wells, which existed in a number of different departments and line-of-business (LOB) applications, and with no formal organization method in place.
The company’s IT team, which consisted of only two individuals, spent months building a homogeneous master database from which the various business units would draw. With this database in place, the IT team needed help building applications and processes that the operations teams would use to access this primary source of data.
These applications and processes would have to address a number of daily challenges.
Because previous workflows could not tap into a trusted company wide source of data, inter-department collaboration suffered. Users were often limited to analyzing data sets that resided in their own departments, or sometimes on different computers or network file shares within the same department.
Timely and accurate decision-making
Existing data processes hindered management’s ability to make financially sound decisions. Most analysis had to be done manually in Microsoft Excel by manipulating data from multiple sources. The analysis was often not as thorough as desired due to tight timelines and old data, and resulting decisions came with a lingering sense of uncertainty.
The paper problem
Each acquired lease came with vast volumes of paper files that were piled high throughout the office. These files were often improperly cataloged or not tagged with metadata. As a result, important insights were missed during a hastened review process ahead of an acquisition decision, and additional opportunities for cost savings or ROI improvements were not realized.
A dependence on the individual
Data analysis processes were often dependent on specific individuals who retained the “how” and “why” of a process. An individual transitioning to a new role took this knowledge with them, forcing the company to reinvent the wheel with regards to information management
Limited IT resources
Jones Energy’s two-person IT team could not justify the time or resources required to build, execute, and manage a new, robust on-premise technology infrastructure. The IT staff wanted to spend more time on projects that grew the company’s operations, and would rather use their IT budget to build out functionality improvements to support business operations than have to hire the additional staff required for an on-premise build-out.
Jones Energy needed a collaboration tool that would help achieve KPIs for internal rate of return on projects and allow for more informed decisions. This tool would also allow for on-boarding of unstructured assets in a searchable way, enable business process automation, and be manageable with minimal internal IT support. Thanks to its expertise in SharePoint and proven track record of helping companies access hidden insights in their data, they called Entrance Software in to help.
Jones Energy did not want on-premises infrastructure, which required upgrading their hardware system, middle-ware, and software platforms. An on-prem solution would simply require too much labor, and with Office 365, they only had to pay for what they use.
Entrance proposed a hybrid cloud data management model comprising the cloud-based productivity tools available in Microsoft Office 365, coupled with the content and document management functionality of SharePoint. To on-board paper assets, Entrance enlisted business partner, KnowledgeLake, to perform document scanning and management.
The solution was first implemented for the operator’s Land team. It was built on Entrance’s FRAC information management framework, which provides Findable Content, Repeatable Process, Analytics in Context, and Collaboration Across Teams. Office 365’s search functionality lets users quickly sift through files that are tagged by name, content, and other relevant statistics. For unstructured data, the KnowledgeLake Capture program digitizes paper files and tags information by document type and its associated metadata. KnowledgeLake Connect then allows users to upload files directly from Office client applications (Word, PowerPoint, Excel, and Outlook).
The custom solution for Jones streamlines and automates workflows for business functions such as lease analysis and non-operated well proposals. An electronic proposal document can be dragged into a new library through KnowledgeLake Connect, and pertinent information—proposal type, production or revenue potential, response deadlines—is tagged to the document. A workflow then kicks off and a notification is sent to responsible parties in four departments—Geology, Land, Operations, and Regulatory—for their review. After each group has decided whether or not to participate, the proposal is sent to the chief operating officer for final decision.
The solution provides a workflow history that details which users have accessed a file, when it was accessed, and which outstanding tasks remain open. Automatic alerts notify users when some action is required, thus improving accountability and making project administration less cumbersome.
SharePoint makes finding content easy. When uploading documents to the Lease repository, users only enter Content Type & Well Name. The solution pulls and adds an additional 18 fields including: API, BOLO_ID, County, Division, Engineer, First_Prod Date, Geologist, NRI, OP_CODE, Spud_Date, and State. This makes searching for related documents easy and intuitive, and the document preview lets users quickly validate they have the right files.
The implementation of the hybrid cloud-based solution provided Jones Energy with an immediate CAPEX savings of $100,000 over building an on-premises model—money that could be invested in other revenue-generating projects.
The ability to use meaningful data analysis during the decision-making process led to increased trust in the data, better decisions, and less post-mortem analysis. By providing a single data source for structured and unstructured data, the data stewardship process became more streamlined and efficient.
The improved analysis and search ability provided by SharePoint allowed users to quickly find a wealth of information on an individual well simply by typing in a few key search terms. This reduced the number of adhoc reports that had to be generated, and limited data manipulation to just a few hours per week. This also assured that reports were issued with the timeliest data available.
The cloud-based solution provided a more steady, secure, and fast connection over the Internet, which improved collaboration between the office and the field crews. The solution afforded faster downloading of daily work reports from the field and seamless communication and data sharing when troubleshooting a problem with a well.
Finally, the solution eliminated the need for a large, in-house IT team. Rather than perform the day-to-day management of the infrastructure and software, Jones pays Microsoft a monthly fee to manage this, at a fraction of the time and cost. The Jones IT team is now free to focus its efforts on projects that can grow the business.
Jones Energy is now extending this hybrid data management solution to full digital management of corporate records. It will also be expanded into other departments to streamline collaboration, document management, and workflow automation across the entire company.
Jones Energy’s expansion plans are a testament to the solution’s effectiveness in building trust in the data—trust that leads to more timely, accurate and actionable decisions.
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