TULSA, Okla., April 27, 2017 – An independent exploration and production company is reducing general and administrative (G&A) expense and sharpening focus on its core business via a managed services agreement with Stonebridge Consulting for a broad range of information technology (IT) services. The company’s decision reflects a growing trend in the oil and gas industry as more operators discover outsourcing to be a viable business strategy.
The Oklahoma-based company operates nearly 1,500 wells on approximately 150,000 acres extending from the Permian Basin to plays in East Texas and North Louisiana. The company’s initial evaluation of the outsourcing agreement with Stonebridge conservatively estimated a 50 percent reduction in G&A expense while broadening the IT skill sets at its disposal.
Under the outsourcing arrangement, Stonebridge has assumed day-to-day responsibility for managing network operations, storage and database administration functions, as well as providing expert-level support for commercial oil and gas applications and technology platforms. Additionally, Stonebridge is proactively optimizing the company’s information and infrastructure architecture, and performing database performance tuning and application configuration support.
This agreement follows an advisory services engagement in which Stonebridge worked with the company’s executive team and private equity advisor to manage the relocation of their corporate headquarters. Stonebridge was responsible for migration planning, including front-end discovery and documentation of infrastructure assets such as local area and wide area networks, databases and technology platforms.
As a business practice, outsourcing, whereby a company transfers day-to-day responsibility for certain functions and tasks to a third-party service provider, is most typically employed to save costs. Outsourcing in oil and gas experienced a clear uptick in response to the market downturn, when cost containment was a necessity. As the market stabilized over the past 18 months, however, many operators are realizing that outsourcing offers competitive advantages beyond cost control.
“Oil and gas companies are taking the cost containment discipline they gained during the downturn and turning it into a corporate capability,” Stonebridge Consulting President Adam Hutchinson said. “Necessity is the mother of invention, and operators are now leveraging outsourcing to be more competitive by utilizing service providers like Stonebridge who know the industry and have the requisite experience and infrastructure to ‘own’ specific functions, processes and technologies. This allows them to keep a sharper focus on their core business objective, which is to produce hydrocarbons more efficiently, safely and profitably.”
Stonebridge provides a wide range of outsourcing services through its SmartSourceSM Managed Services program. SmartSource engagements are structured under a client-defined service level agreement (SLA) and cover a wide scope of business functions, technologies, and technical skill sets and expertise. The SmartSource engagement model gives oil and gas companies complete control to fill their capacity needs, at far less cost of hiring full-time personnel.
For more information on how oil and gas companies are gaining a competitive advantage through Stonebridge’s SmartSource Managed Services, visit www.sbconsulting.com/services/smartsource. To schedule a complimentary SmartSource whiteboard session, click here.
Stonebridge Consulting, LLC, is a leading provider of business advisory and technology services for next-gen oil and gas. Stonebridge’s services help oil and gas companies produce hydrocarbons efficiently and safely, optimize volumes, increase margins, and maximize returns. Headquartered in Tulsa and with offices in Houston, Oklahoma City, and Denver, we serve the oil and gas industry exclusively, with targeted solutions for upstream, midstream, downstream and oilfield services companies focused on resource plays in North America. More information about Stonebridge Consulting is available at www.sbconsulting.com.
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