Digitalization and Advanced

Analytics in upstream Oil &

Gas – from Hype to Reality
DISCUSSION DOCUMENT | MARCH 2018
Selected digital opportunities & use cases

Bringing the best partners and experts

Our agile impact driven approach with a focus on capability building

McKinsey & Company 2

 We have ready to implement impact case studies along
all types of Repsol priorities (not exhaustive selection)
A Predictive Maintenance
▪ Gas Compressor Use Case

B Real-time well monitoring

Operations &
Maintenance
We have identified three
categories of digital
initiatives based on
understanding of your
priorities
We have specific case
examples of our
experience in delivering
impact using digital and
advanced analytics
solutions
▪ Operations Centre (Siemens)
C Production Optimisation
▪ Artificial Lift Use Case (Siemens)
D Integrated Asset Management
▪ Workflow optimization (OVS)
E Supply chain optimization
Supply Chain ▪ Tanker logistics use case
▪ Water logistics use case
F Drilling & completions optimization
Drilling &
Completions
▪ Real time drilling operations centre
▪ Drilling operations optimization
(External Example – Devon)
McKinsey & Company 3
 A Predictive Maintenance can reduce production losses due to gas
compressor outage by 50% Failure 1 Failure 2 Failure 3 Failure 4
Approach – use proprietary tools Trigger for intervention
Context to develop a custom solution Impact
North Sea unit of a ▪ QuantumBlack/McK analytics developed ▪ The predictive model is able to predict compressor failures
supermajor identified that the model in 2 weeks and triggers intervention ~1 week before failure
gas compressors accounted ▪ Model identified 8 sensors as ▪ Testing the effect of PdM for the compressor with
for many failures and for a important to predict failure beyond engineers leads to a reduced loss of at least 50% for
large portion of production the 2 monitored by engineers major events
losses
▪ The most critical
compressor was Reactive system
Predicted time to failure. 12-hour average
selected - with the
prediction1, Days Prepa-
highest contribution to Mainte-
the production losses Normal
11 Normal operation nance
▪ Loss data, maintenance Failure predicted in 5 days operation
ration activity
work order data and 10 – triggers intervention
sensor data was 9
collected 14 days
8
Question Breakdown downtime
7
▪ To what extent can the
reliability be improved by 6
Predictive system
predicting when a failure 5
will happen? 4 Prepa-
Normal Mainte-
3
opera- nance Normal operation
2 tion activity
ration
1
0 Predict ▪ Order
10 9 8 7 6 5 4 3 2 1 0 failure material
Actual time until failure, Days
▪ Plan
4-7 days
work
downtime
▪ Schedule
person-
nel Time

1 Only four of the 10 failures have more than 7 days of history from between prior shutdown and compressor failure
SOURCE: Team analysis, Sensor data, Loss data McKinsey & Company 4
 B Digitalization can save 30% of manpower costs by improving
operations & maintenance of an offshore production platform
Context
▪ Client commissioned new
offshore production
platform in North Sea while
oil prices dropped
significantly
▪ Offshore platform planned
in remote location with
harsh environment
▪ Key objectives defined
– Asset: Maximize asset
uptime and its
maintenance efficiency
– Regulation: Ensure
safety and
environmental
compliance
– Manpower: Leverage
expertise located
onshore and minimize
operational team staying
offshore
SOURCE: Siemens, McKinsey
Approach
▪ Operational control center with
seamless integration of all
technologies such as Electrical,
Instrumentation & Control and
Rotating Equipment
▪ Software applications to optimize
asset performance and manage
safety remotely
▪ Cloud-based data connection
using Siemens' open IoT
operating system Mindsphere
and data analytics using
Siemens Sinalytics
▪ Operational intelligence
applications to support experts
and management decision-
making with real-time data on
safety, environment, production
insights and KPI’s
▪ Integrated alarm management for
production operations
Impact
▪ Number of high-cost offshore
personnel reduced by 60%,
thereby also reducing costs
for helicopter transport and
extra-hour shifts
▪ Increased recovery by
permanent onshore expert
connectivity
▪ ~30% savings achieved by
keeping manpower in
central onshore location
▪ Advanced condition-based
maintenance of critical
equipment's process
optimization through
advanced process control
▪ Used lifecycle process
simulation and training
software for training in safe
environment and to shorten
commissioning time
McKinsey & Company 5
 C Using Advanced Analytics for artificial lift automation and Well
surveillance can improve production by 2-3%

Context Approach – bringing the best of McK + Siemens Impact

Of its well base, ca. ▪ Enabled remote

50% of all wells were
unconnected,
monitoring done via
regular site visits and
manual checks
design & delivery
▪ High service and
operational costs
▪ Production losses
due to
unrecognized
failures
▪ Low productivity
Goal: Develop
a cost-effective
minimum viable
solution and achieve
production
optimization through
well automation
innovation
monitoring of well
Experienced Impact-oriented and Deep digital execution status in real-time
project extensive oil & capabilities leveraging our
▪ Increased
management industry experience, dedicated units for digital
incremental
team for rapid with deep transformation and
production
understanding of advanced analytics (e.g.,
by 2-3% by
of the solution value drivers Quantum Black)
– Decreasing
downtimes
– Faster restart of
operations after
▪ Aimed for a minimized hardware setup with standardized disruptions
industrial components ▪ Expected reduction
of field-personnel
▪ Edge Analytics concept for optimized independent operation
costs by 20-30%, as
– Edge device enabling advanced analytics of wells and real- less site visits are
time data transmission necessary
– Open source software allowing expansion of software features ▪ Solution rapidly
scalable, due to
▪ Total costs for installed solution ca. 40-50% lower lean and
than existing solutions cost-effective setup

SOURCE: Siemens, McKinsey McKinsey & Company 6

CASE STUDY – DIGITAL OPERATIONS PLATFORM

D Integration and automation of workflows between existing systems has

shown a dramatic impact on engineer efficiency and effectiveness
Workflows can simplify access to data, automate analysis & Workflows implemented through Production Efficiency
prioritize anomalies – enhancing operational performance recent 8wk pilot with Santos2 uplift gain3 Impact

Well review tool: Production uplift4

Operations Provides interactive dashboard to ▪ Well optimization 5-20%
access comprehensive well ▪ Intervention
information, production data, forecasts Enabler identification
etc. Displays wellbore schematics with
Well data key numerical data such as TD, hang
up depth, tubing diameter etc. Efficiency uplift
▪ Automated 15-70%
SAAK processes
WORKFLOW
Production Surveillance Surveillance by exception:
1 APPS
Server Generates smart alerts based on
complex rules using multiple input Integration /automation
80-90%
parameters. Notifies relevant lead time reduction
personnel for early intervention
▪ The unparalleled speed of
implementation is achieved “Last month I only looked at
through leveraging pre- Compression Opportunity: 10-15% of the equipment data
built data connections to Complex automated workflow makes on a given day. I’m up to 100%.
>80 O&G software use of several software packages to Literally, I can monitor
solutions coupled with an find and high grade compression
everything, every day.”
ever growing array of opportunities to increase production
configurable workflow apps
▪ McKinsey ensure impact is
delivered through PMO, Production model update and “This analysis used to take a
governance and results calibration: full week. Now it’s a button
oriented discipline Automates transfer of cumulative
Enabler press and 4 min later its
production data to model and
compares real production rates with gathered the data and cranked
model forecast all the numbers.”

1 The McKinsey SAAK solution is based upon technology from OVS, a McKinsey strategic partner 2 Client permission obtained to use them as a
reference for SAAK implementation
3 Efficiency defined as a combination of reduced data gathering and transfer time and improved quantity of value add time 4.Typical of an extended implementation (Santos
estimate 1-2% from pilot workflows)
McKinsey & Company 2
McKinsey & Company 7
 E Integrated supply chain optimization can reduce costs of tanker logistics
by 17%
Context Approach – use proprietary tools to develop a custom solution Impact
South-Asian oil and gas and Solution – Tanker logistics routing, cost and customer ▪ 17% reduction in
petrochemical client was satisfaction app tanker logistics cost
facing a tanker routing ▪ Defined a unique cost function based upon practical costs faced during first 12 months
problem by client deployment
▪ Used proprietary route planning and optimization software solution ▪ Extensive
Worsening client satisfaction
for complex and service-critical networks (ROPOS) customization with
and profitability
generation of practical
Business objective: solutions
▪
Pick up Delivery
Pick up consign- Pickup Delivery consign- Delivery
Continuous route
▪
Route Distance stops ments weight stops ments weight Score1 Opportunity2

Arrest out of control Weight

#1
30% 20% 10% 5% 20% 10% 5%
83 H
optimization
#2 65 H
tanker logistics costs #3 53 M
leveraging machine
▪
#4 53 M

Develop optimal tanker #5

#6
50
43
M
L learning
routing from 5 loading #7
#8
40
35
L
L

ports, given monthly #9

#10
25
18
L
L

demand at 14 unloading #11

#12
15
15
L
L

ports
#13 8 L
#14 0 L
#15 0 L

McKinsey & Company 8

E Logistics optimization with custom tools can deliver 15% cost savings
Context Approach – partner with specialist software company Impact
▪ Major basin operator in Digitized workflow and created analytics tools with Arundo ▪ 15% in cost savings
North American ▪ Leading AA software company using big data and machine identified, delivery
unconventionals learning with a focus on O&G underway
▪ Water operation moved ▪ Provide software tools and data engineers to the core team – 4% from
>50MM bbl per year of procurement
fresh flowback
3/9/2017
– 5% from daily
▪ Produced and moved Hauler
InterstateNDTINC
Forecast
2,200
# trips
20

0
2,200
Actual bbls
0
Destination
Pettit
executions at the
water through a EnergyTransportationLLC
InterstateNDTINC
0
0
0
0
OXF 160
Pettit
pad
– 6% from system
EnergyTransportationLLC 0 0 OXF 160

fragmented hauler base InterstateNDTINC

no zone
no zone
0
0
0
0
0
0
Pettit
none allocated
none allocated

optimization and
InterstateNDTINC 0 0 Werner

of over ~20 different OhioValleyWaterResources

InterstateNDTINC
0
0
0
0
OXF 160
Werner
InterstateNDTINC 0 0 Pettit

contractors EnergyTransportationLLC
EnergyTransportationLLC 1200
0
11 1210
0 OXF 160
OXF 160 network design
▪
EnergyTransportationLLC 0 0 OXF 160
EnergyTransportationLLC 0 0 OXF 160

While the current operation EnergyTransportationLLC

EnergyTransportationLLC
0
0
0
0
OXF 160
OXF 160
Delivered tools and
EnergyTransportationLLC 0 0 OXF 160

maintained high service

EnergyTransportationLLC 0 0 OXF 160
end-user design
levels it lacked pilot initiatives over
▪ Systematically managed Overhaul 16 weeks
Map safety
safety performance water truck – Scheduling and
“hot spots”
scheduling routing tools,
▪ Comprehensive cost
centralized
reporting
dispatch
▪ Accurate, visible – Interactive digital
operational data
dashboards

Improve Performance
billing and KPI
accuracy dashboard
McKinsey & Company 9
 F Setting up a Real-Time Operations Centre helps identify opportunities,
increases performance and EBIT(1/2)
Context
Largest NGL producer
and gas processor in
North America
▪ 61 plants, 2,000+
compressors and 64,200
miles of pipeline
▪ CEO wanted to leverage
Digital and Advanced
Analytics to drive 20%
increase in profits,
change the way DCP
works and create a new
culture of innovation
DCP plants and
compressors were
underperforming; no real
time data transparency;
trouble shooting was
random and reactionary
▪ Plants had no margin or
operations targets
▪ Commercial teams
lacked tools for
contract/routing
▪ Systems operators had
no data on profitability
levers
SOURCE: Source
Approach – partner with specialist software company Impact
Solution – Design, build, hire team and launch an ICC ▪ Several $10MMs
additional profit in
first 7 months
▪ 25 of 61 plants
currently operated
from ICC
▪ Driving to deliver
~$200MM in EBIT in
next 18 months from
ICC went live in May 2017 identified and
Goal: Remote operation of all plants and compression prioritized ICC
from Denver opportunities
Center of Excellence ▪ Second wave will
focus on AA/machine
learning
Leverages detailed financial and engineering models for all
plants (in OSI Pi)
Creating system models in R to maximize value from trade-
offs and operations decisions in each basin/sub-basin
McKinsey & Company 10
 F Setting up a Real-Time Operations Centre helps identify opportunities,
increases performance and EBIT (2/2)
Context Approach – partner with specialist software company Impact
Largest NGL producer and ▪ Solution – Use ICC performance data to create Plant ▪ Significant increase
gas processor in North Leaderboard app in performance
America ▪ Plant margin and operations performance updated daily transparency
▪ 61 plants, 2,000+ ▪ Ranks Plants on key economic and engineering metrics – Doubling plant
compressors and 64,200 – Green – Plants above target profitability in
miles – Red – Plants below target worst case plants
of pipeline ▪ CEO, COO, and ICC team can call plant operators directly via – Contributing
▪ CEO wanted to leverage app directly to ICC
Digital and Advanced value
▪ Built off of ICC OSI Pi platform
maximization
Analytics
to drive 20% increase in ▪ Focusing senor
profits, change the way leadership and
DCP worksand create a plant operators on
new culture of innovation most critical
Lack of plant performance performance
transparency and inability challenges
to focus attention and ICC Plant Leaderboard ICC Plant Leaderboard ▪ Establishing a
June 30, 2017 June 30, 2017

resources on most critical Margin ( $K)

YTD Total
Other KPIs
center of
Daily Margin Margin Utilization (%) Recoveries

problems every day Zia II

Target Actual
XXX YYY
Gain/(Loss) Comment
Z,ZZZ - Goliad
Target Actual
XX YY
Target Actual
XX YYY
Comment
Xxxxx excellence to
▪ Plants were operating in address common
Goldsmith XXX YY Z,ZZZ Schd. outage Zia II XX YY XXX YYY -

Rock Creek XXX YYY ZZZ Expander down Ozona XX YY XX YYY Xxx, xxxxxx

silos; performance issues Goliad XX YY ZZZ Solid recovery SW Ozona XX YY XX YY - engineering and
not identified or
SW Ozona

Ozona
XX

XX
YY

YY
ZZZ

ZZ
-

-
Okarche

Rock Creek
XX

XX
YY

YY
XX

XX
YY

YY
-

Xxxxxx, xx
economic challenges
addressed promptly Okarche

Kingfisher
XX

XX
YY

YY
ZZ

ZZ
-

-
Eunice

Kingfisher
XX

XX
YY

YY
XX

XX
YY

YY
-

Xxxx

resulting in significant lost Eunice XX YY ZZ - Eagle XX YY XX YY Xxxx, xxxxx

Eagle XX YY Z Client vol. down Goldsmith XX YY XXX YY Schd. outage

profits/EBIT Total XXX YYY Z,ZZZ Total XX YY XXX YYY

▪ Operations excellence Below Target >5%

Above Target >5%
Below Target
Above Target

not leveraged across

plants or basins
SOURCE: Source McKinsey & Company 11
 F Production increases and cost reductions have been driven through
deploying AA in Drilling and Completions
Context
Fortune 500 exploration
company in North America
focused on onshore
exploration and
production
▪ 2,058 billion barrels of oil
equivalent in total
proved reserves
Business problem
▪ Reduce the non-
productive time during
drilling
▪ Avoid screen-outs during
hydraulic fracturing
▪ Avoid LPOs through
artificial lift failures
▪ Improve reservoir
management
EXTERNAL
Approach – partner with specialist software company Impact
Solution – Machine learning and advanced analytics to improve ▪ Devon’s costs to drill,
Drilling & Completions complete, and
operate wells have
Geosteering and drilling-focused fallen by 40%
programs
▪ Single-digit
▪ Real-time drill bit tracker percentage
▪ Real-time analytics increases in
▪ Analytic tool to predict which production across
sections of a well most likely lead to its portfolio
nonproductive time ▪ 90-day production
rates from
Avoiding screen outs during horizontal wells
hydraulic fracturing have increased by
▪ Real-time analysis of fracturing 250%
fluid, formation characteristics, and ▪ Drilling-focused
field history to indicate the analytics programs
are preventing costly
probability of screen-out and avoid it
errors and helping rig
crews deliver better
Production and Reservoir
Management wells in less time
▪ Devon has interactive map that ▪ Transformed field
used to calculate how much oil/gas is maintenance from
left in any given shale field in the US time based
schedule to one
▪ Predictive analytics used to assess
that is largely
the company’s artificial lift units
prescriptive
McKinsey & Company 12
Selected digital opportunities & use cases

Bringing the best partners and experts

Our agile impact driven approach with a focus on capability building

McKinsey & Company 13

What we bring to the table
The McKinsey you know
▪ Experience in supporting top O&G
companies on strategic and
operational topics, with deep
understanding of value drivers
▪ Extensive oil & industry
experience and benchmarks: Oil &
Gas dedicated industry specialists
and proprietary research (e.g.,
Upstream operational benchmarks,
Overhead benchmarks)
▪ Impact-oriented: track record of
driving growth, profitability and cost
efficiency (e.g., sourcing excellence,
cross-divisional operational
excellence)
▪ Pragmatic and operational: a team
that can create impact quickly
SOURCE: McKinsey
The McKinsey you may not know
▪ McKinsey Digital Labs (MDL): a team of
500+ experienced developers to rapidly
build and realize CX experiences and
transformative journeys
▪ An extensive track record
of digital transformations
conducting over 350
transformations over past five
years, including oil & gas
▪ Agile @ scale IT delivery: a
track record of accelerating
transformations, with a
rigorous focus on getting
impact through minimum
viable products; at times
BOT; at times with SI
partners
McKinsey & Company 14
Bringing a flexible model to you, which is made stronger by partnerships with
global digital players
1 Digital Strategy 2 Solutions and use cases
Quantum
Black
Quantum
Black
▪ Data-driven performance firm originating from Formula 1 and
owned by McKinsey
Quantum ▪ Leading-edge player in advanced analytics and digital strategy
Black
▪ Builds behavioral model of mature reservoirs to ensure a
reliable forecast of the field production and maximize well and
reservoir potential
▪ AI-powered research engine leveraging the web to augment data
▪ Used for e.g. predictive maintenance, predicting productivity of oil
wells and optimizing well drilling
▪ Cloud-based system for creating customizable native mobile
applications and desktop tools for field operations mgmt.
▪ Tech. stack for the next generation IoT applications in the
upstream Oil & Gas industry
▪ Includes e.g. predictive maintenance and energy mgmt.
applications
▪ Benchmarks supply chain effectiveness and offers a platform
with spend and cost intelligence in oil & gas
▪ Creates insight in cost reduction potential
▪ One Virtual Source software integrates data, manages assets and
optimizes operations
▪ Supports McKinsey in delivering end-to-end solutions to clients
SOURCE: McKinsey
3 Digital Transformation 4 Data management and
IT architecture
Quantum
Black
▪ Offers software solutions for upstream oil and gas companies
including WellSpring, an oil and gas development planning system
providing solutions in the areas of production network
▪ Kongsberg Digital provides software solutions for the oil & gas industry
including e.g. real-time data aggregation, visualization, advisory solutions,
multiphase flow simulation and rig and drilling systems
▪ Workflow platform building and delivering of category strategies with
integration of procurement analytics
▪ Provides ready to access best-in-class resources, hands-on guidance
for buyers and real-time visual impact cockpit
▪ Leading AA software company using big data and machine learning
with a focus on O&G
▪ Provide software tools and data engineers to the core team
▪ Provides advanced analytics platform enabling e.g. predictive
maintenance by transforming machine, sensor, and part data into
actionable insights
▪ Cloud computing service providing specialized IoT service offerings
that enables enterprises to perform real time analytics, machine
learning, etc.
▪ Provides computer solutions through the use of advanced information
technology including technologies, systems, products, services and
software
McKinsey & Company 15
We have many partners to deliver digital transformations, one of our
upstream technology partners is Siemens – together we bring the best to you
▪ # 1 global oil and gas consultancy, including
“new ventures”
– Digital McKinsey – our dedicated digital
arm
Who we
are – PAX – our specialist upstream asset
operations unit
– RTS – our dedicated business
transformation unit
▪ Sharp focus on digital to deliver value
▪ End to end digital transformation
– Diagnostic & strategy, design, delivery
▪ Integrate and lead all other vendors for client
What we
▪ Top blend of people with experience you
bring
would not expect from McKinsey
– Digital practitioners
– Experienced offshore operators
– Transformation specialists
Throughout the process, McKinsey remains your
impartial adviser – we will recommend the best solution
for you, whether this is with our partner or not
SOURCE: McKinsey & Company, Siemens, BHGE
▪ Globally leading engineering and
technology company
– Siemens is a recognized partner of the
Oil and Gas Industry with a
comprehensive portfolio of solutions,
systems and products
– Global Oil&Gas Practice servicing
clients from Supermajors to mid-sized
companies in 50+ countries worldwide
▪ Industrial expertise (mechanical, electrical,
systems, software platforms and
applications)
▪ Strong digital expertise (OT, IT, Analytics
Connectivity, IoT)
▪ Extensive O&G expertise across the value
chain
▪ Oil & Gas End-to-End Digital Solutions from
electrification to software & managed
services
McKinsey & Company 16
Collaboration with Siemens: selected use cases with proven impact

Case examples Description Impact achieved

▪ Achieve production optimization through well ▪ Increased
automation innovation by developing a cost-effective incremental
1 minimum viable solution production by
Advanced 2-3%
▪ Uses minimized hardware setup with standardized
Analytics for industrial components and Edge Analytics concept ▪ Expected
Artificial Lift for optimized independent operation reduction of
automation and field-personnel
well surveillance ▪ Total costs for installed solution ca. 40-50% lower costs by 20-30%,
than existing solutions

▪ Maximize asset uptime and its maintenance ▪ ~30% savings

efficiency while ensuring safety and environmental achieved due to
compliance less offshore
2 labour activity by
▪ Uses cloud-based data connection based on open reducing costs
Digitalization to source IoT platform to run data analytics and software
improve offshore for helicopter
applications transport and
operations &
maintenance ▪ Operational intelligence applications to support extra-hour shifts
performance experts and management decision-making with real-
time data on safety, environment, production insights
and KPI’s

McKinsey & Company 17

We have many partners to deliver digital transformations, one of our
enterprise technology partners is Microsoft

▪ Unrivalled experience in helping organizations ▪ M+M work side-by-side as a single team

reinvent their core Improves and
▪ Each partner focuses on its core strengths
accelerates
▪ Unmatched record of supporting market leaders on ▪ Together this creates a single shared
overall
digital topics answer that avoids lost efficiency,
business
▪ Industry leader in digital and E2E agile impact inaccurate prioritization and
transformations missed opportunities

▪ M+M collaboration creates a single entity

Enhanced that works together seamlessly with the
operations – client
accelerated – Providing a single management
timeline and
▪ State of the art enterprise technology stack/IP for
reduced
interface
cloud migration and impact case development
overhead and
▪ Handovers are eliminated
▪ World class development, delivery and post-delivery cost – Rework is avoided
support capabilities – Implementation is timely

Breaking the wall between the key digital transformation

players creates a strong partnership and improves the
M+M chances of the transformation succeeding
▪ 70% of transformation efforts fail
▪ Links technology and business in one cohesive team ▪ 72% of which are due to organizational health factors1
▪ Maximises outcomes for the client through a single
end-to-end digital transformation partner to reinvent
its core
1 Source: Scott Keller and Colin Price, Beyond Performance: How Great Organizations Build Ultimate Competitive Advantage, 2011
McKinsey & Company 18
We are recognized as the leading firm on Digital Consulting

Global benchmarking of digital consulting capabilities

High
McKINSEY DIGITAL

“
Depth of digital consulting capabilities

Razorfish
Unsurprisingly, given its
BCG heritage, McKinsey Digital’s
A. T. Kearney Deloitte approach to digital consulting
Cognizant R/GA EY Digital places greatest emphasis on
the importance of the
Sapient Bain & Company overall business strategy of
any of the full-service
Capgemini Consulting PwC integrated digital practices.
“McKinsey Digital now boasts
Roland Berger
some of the deepest
Continuum Innovation Accenture execution capabilities in the
market, including in the area
Smart Design Worldwide IBM of designing, prototyping,
Tata Consultancy Services launching and developing
?What If! Innovation Partners
digital products and

”
Low
Low High services.
Breadth of digital consulting capabilities
– ALM Kennedy Research,
2016

SOURCE: Digital Innovation Consulting Report, Kennedy/ALM Research, April 2016 McKinsey & Company
McKinsey 19
& Company 5
We have digital and analytics centers of excellence worldwide

950+ 500+
digital designers, advanced analytics
engineers and specialists
specialists

CHICAGO LONDON
MOSCOW
370+ 100+
WALTHAM
BERLIN Digital Partners product and domain
DUSSELDORF
managers
SAN FRANCISCO NEW YORK
BRUSSELS
BUDAPEST
WASHINGTON, DC
MILAN
MADRID
INDIA

ABU DHABI
SHANGHAI
SAN JOSE

SINGAPORE

SAO PAOLO SYDNEY

McKinsey & Company 20

Our extended team brings world-class experience in both digital and oil &
gas
Digital Strategy and Leadership Digital/AA in Oil and Gas

Karel Dörner – Liz Ericson – Occo Roelofsen Matt Rogers

Lead MDL Europe Partner Senior Partner Senior Partner
Former Managing Former PM Digital Strategy Digital Strategy
Director

Markus Berger-de Rupert Stuetzle – Anders Brun Richard Ward

Leon – Digital Partner Digital VP Partner Senior Expert
Former Venture-CEO Former MD/CTO Digital Transformation Founder of several oilfi-
eld technology start-ups

Matthias Schmidt- Rakhi Rajani – Scott Desmarais Guillaume Decaix

Pfitzner – Digital Digital VP Partner Partner
Partner Former Design Digital Transformation Digital Transformation
Former SVP Digital Director
Media

Digital Product Building

Jennifer Kilian – Digital Friederike Schultz – Sr. Aishwarya Singhal – Sidney Levy –
Partner Digital Manager Sr. Digital Expert Exec. Design Director
Former Head of Former Chief Creative Former Manager Former Design Director
Product Design Officer

Other recent
hires from:

McKinsey & Company 21

Why McKinsey: McKinsey is uniquely positioned to deliver Digital Trans-
formations and strategically rethink the end-to-end business operations
We drive business impact and realize the value at What does this mean
hand. The client and business value are our most for you?
important goals ▪ Unparalleled view of
CxO perspective
We integrate best-of-breed technologies – ▪ In-house capability for
independent, unbiased perspective with deep digital solutions support
understanding of technologies to drive impact & no
vested interest in tech choices ▪ Long-standing
organizational and
change management
The no. 1 oil & gas consulting firm with 1700+ experience
studies in last 5 y; 500+ core practitioners & experts;
served 90% of top 20 companies
▪ Holistic transformation
approach focused on
driving business impact
Digital expertise with top industry rankings; 3000+ ▪ Proven approach on IT
studies in last 10 y; in-house expertise with 850+ strategy to enable
developers, data scientists & “translators” digital

Committed leadership & expertise that bring the best

of our global firm to clients

SOURCE: McKinsey, Team analysis McKinsey & Company 22

Selected digital opportunities & use cases

Bringing the best partners and experts

Our agile impact driven approach with a focus on capability building

McKinsey & Company 23

For any opportunity we choose to pursue, we use an agile approach:
focusing on the “minimal requirements” onto which new features are
progressively built

Traditional “waterfall” project delivery Rapid digitization agile approach

“This is a big and long project, let's make Start with the minimal viable
sure we capture everything, otherwise we product (covering 80%
are never going to get it” of customers)

What we want (and would originally build)

Evolve over time

for what we really
need

McKinsey & Company 24

Case example: Walkthroughs of major processes like Maintenance
will highlight what workers experience every day and help you
design more efficient processes PREDICTIVE MAINTENANCE EXAMPLE

▪ Identify the
biggest pain
points and
sources of
waste
▪ Ensure that
automation
solution or
application
being bought
or developed
gets at the core
of those pain
points and
losses

McKinsey & Company 25

Case example: For example, in just 8 weeks a team was able to build
an app for Maintenance that addressed big user pain points like
creating work orders and keeping track of parts

Notifications can be Standard Work Personalised parts list

raised in app, (and are Instructions and other available for each work-
integrated with SAP) references are available order
through app

McKinsey & Company 26

The long-term success of a digitalization effort depends on the ability to
develop a network of new capabilities around big data/AA/Business
Roles and typical profiles needed
Data ▪ Background in (Applied)
Scientist Mathematics, Data Mining,
– “Quant” Statistics, Machine Learning,
Computer Science, Physics
Advanced Analytics
▪ Builds the mathematical algorithms
(Data Scientist / “Quant”)

Analytics
Analytics ▪ Data Scientist background with
Analytics
Engineer more focus on Computer Science
Engineer Translator
Analytics and programming
leadership ▪ Takes data scientist’s algorithms
“Translator” and makes it more efficient
IT / big data
Traditional
management Data business Analytics ▪ Data Scientist background +
strategists managers Translator additional background and
experience in business
▪ Understands business problem and
translates into technical language
and vice versa

SOURCE: McKinsey McKinsey & Company 27

We use our proven see-do-teach change management techniques
Working approach
McKinsey consultants
▪ Initial training of change
agents
▪ Initiation of the program
▪ First-time application of
tools and category
optimisation approach
▪ Initiate feedback on new
initiatives
Level of
involve-
McKinsey
ment
Transformational, sustainable Analytics capability building to enable our clients
SOURCE: McKinsey
Change agents supported
by McKinsey consultants
▪ Replication of the training
within other groups/waves
▪ Get feedback from
participant
▪ External consultant should
coach the instructors
CLIENT EXAMPLE
Sustainable
capability
Change agents and plant building
champions to sustain the
development
▪ Client employees lead the
training across next waves
▪ Primary support provided
by experienced instructors
from previous waves
▪ Intensive feedback and
coaching provided by
experienced coaches
Client
McKinsey & Company 28
Example schedule for capability building program – to be CLIENT EXAMPLE

customized as per program needs

Activity 1 2 3 4 5 6 7 8

Data Kick-off Project work principles

Scientists
Define problems and collect data
Session 1
Data prep and initial analysis

Model selection and development

Session 2
Model optimization and implementation

Kick-off Project work principles

Translators
Define problems and collect data
Session 1
Model understanding

Derive actions from insights

Session 2
Ensure lasting results

Organization setup
Analytics Kick-off
Managers Talent management & attraction

Session 1
Change management

Knowledge sharing
Session 2
Managing partners

Kick-off
All
Case simulation workshop

▪ All sessions designed around real-life analytics cases and are delivered by field experts going through actual cases
▪ All sessions requires colocation and a dedicated 5 hour time slot

McKinsey & Company 29