mySAP Oil & Gas

SCM Overview
Focus : TSW

Name
Speaker Title, SAP AG

mySAP SCM for Oil & Gas

z

mySAP SCM for the Oil & Gas Industry is a complete and comprehensive
solution to cover the movement of bulk volumes throughout the supply chain
network. It provides support for activities in all lines of business - crude, refined
products & LPG, lubes, natural gas and chemicals, including services.

Upstream

Mid-Stream

Refining

Primary
Distribution
Network

Secondary
Distribution
Network

Crude
Refined Products & LPG
Lubes
Natural Gas
Chemicals
SAP AG 2002, Title of Presentation, Speaker Name / 2

Service
Station
Retailing

Oil & Gas Solution Map : SCM Main Focus Areas

Business
Strategic Enterprise
Business Analytics
Intelligence &
Enterprise Management
Management
Decision Support
Upstream

Supply

Manufacturing

Sales, Service &

Marketing
Service Station &
Convenience Retailing
Enterprise Asset
Management

Business Support

Exploration & Appraisal

Supply Chain
Planning &
Optimization

Development

Acquire, Trade &

Sell

Production

Exchange &
Throughput
Handling

Manufacturing Planning
Manufacturing Process
& Optimization

Accounting

Scheduling

Employee
Relationship
Management &
Workforce
Analytics
Marketing

Inventory
Management

Batch Manufacturing

Joint Venture
Management

Disposal

Primary
Distribution &
Transport

Blending & Packaging

Secondary
Distribution &
Transportation
Product Quality
Management

Marketing

Contracts, Sales & Pricing

Service

Analytics

Convenience Retailing

Fuels Management

Site & Headquarter

Accounting

Business Analysis &

Reporting

Specify & Design

Procure & Build

Operate & Maintain

Decommission & Dispose

Employee Life-Cycle &

Transaction Management

Procurement

Financial Supply Chain

Management

Environment, Health and

Safety

SAP AG 2002, Title of Presentation, Speaker Name / 3

Oil & Gas Solution Map : Supply

Supply
Supply Chain
Planning &
Optimization

Acquire, Trade &

Sell

Production
Forecasting (S20, S3)
Demand Forecasting
(S20, S84, S3)
Market Price
Forecasting (S20, S3)
Supply Network
Modeling (Nodes,
Constraints etc.)
(S84, S3)
Simulation (S84, S3,
S20)
Supply Network
Balancing (S84, S3,
S20)
Exception Handling
(S84, S3)
Sourcing Optimization
(S3, S20)
Movement &
Transport
Optimization (S21,
S20, S3)

Inquiry/Quotation
Management (C2,
C17, S241)

Contract Planning
(S84, S3, S1, S5)

Open Position
Reporting (S241,
S48, S13)

Transport
Availability Planning
(S84, S87, S3, S22)

Purchase &
Acquisition (S240,
C2, S5)
Sales (S240, C2,
C17)
Pricing (S240, C2,
C17)
Spot Trades (S240,
S1, S12, S48, S43)
Paper Trading
(Hedges, Swaps,
Options etc.) (C1,
S241, S43, S48)
Deal Capture (S241,
S48)
Risk Assessment &
Exposure (S241,
S12, S43)

Contract History
Tracking (S241,
C17, S13, S87, S19)
Taxes & Tax
Reporting (S240,
C1, )

Exchange &
Throughput
Handling

Scheduling

Exchange Partner
Evaluation
(Exchange Portfolio)
(S3, S13, S84, S87,
S85)

Nomination
Management (S241)
Freight Contract
Management (S240,
C2, S241)

Exchange Agreements
(S240, S87)
Terminalling /
Throughput
Agreements Handling
(S240, S87)
Processing Agreements
(S240, S87)
Fee Handling/
Repricing (S240, S87)

Bulk Scheduling
(S241, S87)

Exchange Balance
Reporting (S240,
S241, S87, S85, S13)
Exchange Transaction
Notification (S240, S87,
S85)
Settlement/Netting
of Exchange
Agreements &
Reconciliation
(S240, S244)
Exchange Position
Reporting (S87,
S84, S13, S12)
Exchange Balance
Projections (S244,
S84, S87, S3, S20)
Automatic Exchange
Reconciliation (S244)

Transport
Availability and
Compatibility (S241,
S87)

Inventory Valuation
& Transfer Pricing
(C2, S87)
Oil/Gas Quantity
Conversions (S240,
S87)
In-Transit Stock
Handling (C2, S87,
S84)
Consignment Stock
(C2, S84, S87)

Compartment
Planning (S3, S20,
S21, S87, S84)

Accounting for
Commingled Stock
(C2, S87)

What-If Scheduling
Simulations and
Proposals (S241)

Accounting for
Losses & Gains (C1,
S87)

Partner Schedule &

Nomination
Handling and
Tracking (C2, S241,
S22)
Berth / Dock
Scheduling (S241, S22)
Contract
Scheduling and
Allocation (S241,
S87)

Silo/Tank
Management (S240,
C2, S87)

Pipeline Batch
Scheduling (S241)
Scheduler Worklist
(S241)

SAP Component Available

Partner Product Available

SAP Component Available with Future Releases

Partner Product Available with Future Releases

Future Focus
SAP
AG 2002, Title of Presentation, Speaker Name / 4

Inventory
Management

Collaborative Business Map Available

Inventory Planning
and Scheduling (C2,
S241, S87, S3)
Location Balancing
(S241, S87)

Primary Distribution
& Transport
Deliveries to
Partners (S240, C2,
S87, S84)
Location Receipts
(S240, C2, S87,
S84)
Terminal Automation
Systems (S240, S87,
P44)
Carrier Performance
Tracking (C2, S13,
S22, S84, S87)
Handling of Transit
& Regulatory
Documentation (C2,
S241, S13)
Freight Cost
Handling (S240, C2,
C1)
Export Handling (C2)
Ticket Processing &
Forwarding (S241,
S240, S87)
Ticket Quantity
Allocation (S241,
S240, S87)
Measurement
Comparison (S241)
Laytime Calculation
and Demurrage
Assessment (S241,
S22)
Transport Performance
Tracking (S241, S240,
S22, S13)

Secondary
Distribution &
Transportation
Terminal
Management (C2,
S240)
Terminal Automation
Systems (S240, P44)
Balance Vehicles/
Compartment
Allocation (S240)
Vehicle/Compartment Optimization
(S3, S20, S21)
Rebranding &
Blending (S240, S3)
Oil/Gas Quantity
Conversions (S240)
Gain & Loss Handling
(S240, S87)
Dispatch & Route
Planning &
Optimization (S240,
S3)
Freight Cost Handling
(C2, S240)
Fleet Management
(S87)
Handling of Transit
& Regulatory
Documentation (C2)
Replenishment
Planning (S240,
S20, S21, S3)
Export Handling (C2)

Cxx SAP Component

Pxx Partner Product
For more information about these products, please see the tables
at the end of this presentation.

Solution Landscape for mySAP SCM for Oil & Gas

APO

TSW

IS-Oil

Demand Planning
(DP)

Inventory planning

Financials

Collaborative
Planning

Supply/Demand
Balancing

Exchanges

Supply Network
Planning SNP

Movement and
Capacity
Scheduling

Contracts / Orders

Production
Planning Detailed
Scheduling

Full nomination
process handling

Inventory

Transport Planning
& Vehicle
Scheduling

Ticketing,
Allocations and
and Events

Movements

Global Availability
to Promise (ATP)

Interfaces to
partner Systems
(e.g. Trading)

Transport

Integration to R/3
4.6c processing

Taxes and Duties

APO
The areas of demand/supply planning and
forecasting, as well as supply chain balancing
and optimization are key functional areas
addressed by APO.

TSW

Integration to TSW
and IS-Oil

Usage in specific business lines (e.g. chemicals and lubes)

SAP AG 2002, Title of Presentation, Speaker Name / 5

The Traders & Schedulers Workbench (TSW)

covers the whole range of business requirements for
Inventory Planning , Supply / Demand Balancing,
Movement and Capacity Scheduling (including
the Distribution Schedule), Nomination
Processing, and Integration into Execution
Processing, including Ticketing.

IS-OIL 4.6c
The processes of order entry, contract
management, exchanges and terminalling
handling, inventory management, transport and
movement execution will remain within the ERP
(R/3 with IS-Oil Downstream) area.

mySAP SCM for Oil & Gas Business Process Coverage

Demand
forecasting

mySAP SCM for

Oil & Gas
embraces SAP and
non-SAP third
party solutions to
cover the
requirements of
the oil & gas
industry

Market
systems

Demand
planning

Partner
systems

Supply
planning

Exchange
planning

Facility
scheduling

Process
control
systems

Production
planning

Inventory
planning

Sourcing

Production
Scheduling

System
Balancing

Movement
scheduling

Comparison Movement
Event
reporting
optimization Management

Transport
planning

Trading
Operations

Transport
scheduling

Logistical
execution

Information
agents

Paper
Trading

Nomination

Financial
execution

Financial
reporting

mySAP SCM solution

mySAP SCM solution - part
Third party solution

SAP AG 2002, Title of Presentation, Speaker Name / 6

Terminal
Automation

External
optimizers

Inspection
systems

Carrier
systems

E-Netting

mySAP SCM for O&G : TSW SP2 Enhancement Areas

Demand
forecasting

mySAP SCM for

Oil & Gas
embraces SAP and
non-SAP third
party solutions to
cover the
requirements of
the oil & gas
industry

Market
systems

Demand
planning

Partner
systems

Supply
planning

Exchange
planning

Facility
scheduling

Process
control
systems

Production
planning

Inventory
planning

Sourcing

Production
Scheduling

System
Balancing

Movement
scheduling

Comparison Movement
Event
reporting
Management
optimization

Transport
planning

Trading
Operations

Transport
scheduling

Logistical
execution

Information
agents

Paper
Trading

Nomination

Financial
execution

Financial
reporting

SP2 enhanced area

SP2 enhanced partial area
Third party solution

SAP AG 2002, Title of Presentation, Speaker Name / 7

Terminal
Automation

External
optimizers

Inspection
systems

Carrier
systems

E-Netting

Brief History of TSW

TSW on 4.6c(2) : FN. EXPANSION Supply Chain, Nomination, SPW
(Rundown), Planning Engine, Ticket,
Worklist, Trading Interface, APO
Integration, Location Balancing, 3-Way
Pegging, Distribution Schedule, Berth
Scheduling, Fleet Management,
Freight Contracts, What-If Pop-Up &
Clipboard, Forecasting
TSW on 4.6c(1) : FN. EXPANSION Supply Chain, Nomination, Rundown,
Planning Engine, Ticket, Worklist,
Trading Interface, APO Integration
TSW on 4.6b : FUNC. UPGRADE

TSW on 4.0b : TECH. UPGRADE

TSW on 3.1h : FOUNDATION

SAP AG 2002, Title of Presentation, Speaker Name / 8

Supply Chain, Nomination, Rundown,

Planning Engine, Ticket, Worklist
Supply Chain, Nomination, Rundown,
Planning Engine, Ticket, Worklist
Supply Chain, Nomination, Rundown,
Planning Engine, Ticket, Worklist

TSW : Functional Environment

What-If

Balancing
Stock Projection
Worksheet

Trading & Systems Interface

Location

Freight Contracts

Berth Scheduling

Nomination

Scheduling

Transport System
Partner role

Tanks
Fleet Mgmt

TSW Master Data

R/3 interface

SAP AG 2002, Title of Presentation, Speaker Name / 9

Worklist

APO interface

Partner interface

Laytime / Demurrage

Ticketing

TSW : One view of the daily process ...

Worklist

Nomination

Scheduling

Stock Projection

Replenishment
Planning/APO

schedule

Fax/
Print/
Idoc
Partner

LIS Info
Structures

Ticket

Postings

Contract

Order

SAP AG 2002, Title of Presentation, Speaker Name / 10

Delivery/
Shipping
Notification

Bulk
Shipment

Goods
movement

SCM : Simplified functional component landscape

Trading
Interface

Stock
Projection
Worksheet
What-If
Simulation

Contract
Planning
Location
Balancing
Partner
Nomination
Demand
Planning
Legend

Transfer
Generation
Optimized
Network
Balancing

TSW Component
Other Component (e.g. APO, IS-Oil, BW)
SAP AG 2002, Title of Presentation, Speaker Name / 11

Berth
Scheduling

Nomination

3-Way
Pegging

Ticket
Processing

Logistics
Execution

Financial
Execution

Distribution
Schedule
Operational
Back Office
Freight
Contracts

Supply Chain Management : APO

Solution
News

APO 3.0 : First robust APO release ; APO 3.1 : First APO release with Oil & Gas
content (master data, enhancements to TPVS, CIF for TD and nominations, O & G
planning books in DP and SNP ; DP is recognized as having general applicability for
process ; SNP has potential in chemicals, lubes and gas cases ; PP/DS in lubes
and gas ; TP/VS we cannot recommend at this stage for bulk primary or secondary)

APO 3.1 : Available as GA since end 2001

APO 4.0 : Tentative availability in mid 2003 there is no additional Oil & Gas
specific content in APO 4.0 (e.g. missing: contracts and in-transit in SNP)

Customer
Update

Live : Pennzoil (US) with DP & SNP for lubricants and consumer business
On the way : Saudi Aramco (SA) for their In Kingdom business DP, BHP
Billiton (NL) using both DP and SNP with IS-Oil and TSW, ExxonMobil
Chemicals (Singapore, US) with all main modules across the board

APO is (for O&G) a developing solution

Its strong points currently would be DP and its increasing integration
with an oil-based execution system (IS-Oil)

Proposed
Strategy

Release
Strategy

Value
Proposition

Good potential/fit for lubes / chemicals / gas cases

For petroleum position together with TSW
Use ExxonMobil and Pennzoil as process-industry cases

SAP AG 2002, Title of Presentation, Speaker Name / 12

Supply Chain Management : TSW

Solution 4.6c SP1 :Included extensive updates to SPW and Nomination
4.6c SP2 : Significant updates, revisions and new functionality in all areas
News
At SP2 level, TSW covers crude and products business for both pipelines and marine.
TSW 4.6c SP1 : GA available since April 2002
TSW 4.6c SP2 : GA available December 2002
Release
TSW will be integrated in the O&G R/3 Enterprise Add-On with Extension Set 2.0, Strategy
end 2003
Live : CITGO (US) Refined Products business (with SAP-BW as well) ; TFE (France)
Customer Crude Pipeline Scheduling Pilot; STUSCO (US) Refined Products and Trading
On the way : ChevronTexaco (US) Refined Products Business Nomination &
Update Execution
; TFE (France) Refined Products Nominaton & Execution ; Saudi Aramco
(SA) Out of Kingdom Export Sales mostly marine ; STUSCO (US) Domestic Crude
Pipelines and Marine ; Transpetro (Brasil) Terminal and Pipeline Handling ; BHP
Billiton (NL) Mining Operations
Unique solution in this market sector
Strong integration to both R/3 solutions incl. APO as well as external, such as Value
trading and refinery process systems
Proposition
Built to wide-scope industry defined requirements
Position TSW as key operation handling planning to execution link
Proposed Use breadth of customers to show flexibility and solution strength
Strategy Absolute strength in bulk operation is key to making later optimization and planning
systems really work
SAP AG 2002, Title of Presentation, Speaker Name / 13

Supply Chain Management : IS-Oil

Solution
News

IS-Oil : Already strong breadth of industry standard solution components

4.6c SP2 :Lean Transport Management simplifying and adding strength to the
TAS and TPI interfaces ; Terminalling solution handling the terminalling
business for providers (fee handling etc)

4.6c SP2 : GA available end 2002

As part of IS-Oil fits in with the overall strategy to integrate solutions into R/3
Enterprise Extension Set 2.0 at end 2003

Customer
Update

On the way : Lean Transport Management Shell (Europe) ;

Productive: Terminalling STUSCO (US) since Aug. 1st, 2002

LTM interface enables up to the minute information to be provided from TAS

systems (inventory positions, rack liftings) for planning and scheduling
This interface is also unique in its level of coverage and integration with R/3
Terminalling is as important as exchanges, and SAP can make this as much a
standard as with EXG in all respects

Proposed
Strategy

Release
Strategy

Value
Proposition

Follow up on Shell and STUSCO successes stories to promote solution

Increase penetration with usage of SCM interfaces TPI, TAS
Push customer terminalling business to use new SAP solution

SAP AG 2002, Title of Presentation, Speaker Name / 14

Key SAP Oil & Gas SCM Takeaways

For most players in the Downstream market sector, the management and
operation of the bulk supply network is the key to achieving bottom line
returns across the company. The requirement is to turn optimum plans into
accountable revenues through excellence in scheduling and execution.
In 2002 SAP has therefore developed, with input from major O&G sector
partners, a uniquely comprehensive solution to meet these requirements
TSW.

With ever increasing pressure on revenues, TCO is a major factor for CEOs and
CIOs in these companies. For COOs having a system that really performs
across boundaries is the key.
Both of these requirements are best met by a system that is as fully integrated
as possible. SAP already has the deserved industry reputation as being the
integrated solution provider, this naturally applies to our SCM solutions too.

Investing in new systems can be a significant risk, both in terms of costs as well
as in terms of business effectiveness. Having a software partner with a track
record of delivery and support is now a key factor in making solution selection
decisions.
SAP now has a presence in around 80% of all oil companies Worldwide. With
nearly 20 years of experience in the oil and gas sector, and an unparalleled
record on solution delivery, this is a strong factor in solution decisions.

SAP AG 2002, Title of Presentation, Speaker Name / 15

Key SAP Oil &Gas SCM References

With our ever expanding portfolio of integrated SCM solutions, including
those in the key areas of turning plans into revenue-generating reality,
SAP is able to state the following major market players as example
references :
STUSCO (Shell Trading U.S., formerly Equiva Trading Co.)

Worlds largest Oil Trading Company

Saudi Aramco

Worlds largest oil producer

These are quoted as examples of both the strength of our solutions, that
such major players are committing their key business streams to SAP, as
well as the comprehensiveness to cover such diverse business models.

SAP AG 2002, Title of Presentation, Speaker Name / 16