Deciding whether an energy company should outsource its natural gas measurement operations or maintain that function in-house is a fairly common business decision. While most smaller energy companies simply don't have the volume [or scale] of business to justify anything other than outsourcing, larger organizations often utilize a strategic combination of both in-house and outsourced resources. In either case, to identify the most cost-effective solution it's extremely important to establish a measurement policy. This will serve as a basis for identifying the processes and budgets necessary to meet corporate goals (operational and financial), and for determining whether third-party resources can be objectively compared. Once policy has been defined, assessing outsourcing options becomes a more straightforward and objective process through considerations such as the following:
- Do we have sufficient in-house subject matter expertise in all phases of measurement?
- Can our IT Department provide cybersecurity using an outside measurement services provider?
- Will our disaster recovery and business continuity plans be compromised or improved with an outsourced measurement service?
- Will we be able to effectively expand or contract measurement services with outsourcing in response to changing business conditions?
- Can the outsourced measurement services provider meet our corporate master service agreement (MSA) and safety requirements?
- Will we be able to seamlessly transfer all measurement operations from an in-house operation to an outsourced service, if necessary, such as in case of business disruption?
- Will we be able to seamlessly transfer all measurement operations from an outsourced service to an in-house operation, if necessary?
- How can we validate quality control and compliance with measurement policy for both third-party and in-house measurement operations?
- Can our field, energy lab, and flow data management processes be integrated, automated, and made more efficient using a third-party measurement software and services solution?
- How will we archive (and destroy) all measurement records according to industry standards and/or regulatory requirements?
- Will we need to provide web-based access to measurement records and data? If so, how?
- Which solution, in-house or third-party, is most cost-effective for each discreet element of the overall measurement process?
- Are there any other non-economic considerations (e.g., audit, contractual, regulatory, etc.) which may significantly influence the best option to pursue?
Regardless of how a measurement department is organized, holding all parties accountable to the same standards, as defined by a comprehensive hydrocarbon measurement policy, can have a tremendously positive impact on accuracy, accountability, efficiency, safety, and true bottom-line profitability. For assistance in developing or evaluating your measurement policy, as well as for accurately assessing the potential benefits of outsourcing all or part of your measurement operations, be sure to contact a highly specialized and experienced hydrocarbon measurement specialist.
"Not everything that can be counted counts,
and not everything that counts can be counted."
~ William Bruce Cameron, American author and humorist