Pipeline Procurement

LinkedIn | Akash S K
Email :- akash.250896@gmail.com
Mob. No: - 797577631
Pipeline procurement in SAP MM
In this topic you will learn about What is Pipeline Procurement in SAP MM. and you will
understand how to create pipe material, Purchase Info Record with P, Goods issue with
movement type 201P and invoice settlement.
What is Pipeline procurement in SAP MM

It is the process where, material will be flowing from the vendor premises to plant premises,
and pipeline material is not stored in any storage location or plant as it consumed directly as
when required, because it flows directly into the production process from pipeline or via cable
and coming to payment its similar to consignment. examples of pipeline materials are
electricity, oil, Gas and water.
Creation of purchase requisition and purchase order is not required because material from the
pipeline is always available; i.e. it can be withdrawn from the pipeline at any time and in any
quantity.
Purchase info record with Info Category Pipeline is mandatory for Pipeline material and while
creating material master we need to select the material type as Pipeline material.
Important points to remember:
 There is no PO, No Goods Receipt, No stock for these materials.

 In this we need not create a PO or keep the material in stock. We only record the
consumption and pay accordingly.
 We only record the consumption. In MIGO transaction, special stock type is “P”
 All the rate and tax info is stored in info records. Info record category for this is Pipeline
Mob. No: - 797577631
Prerequisites for pipeline procurement:
1. Assign material type to valuation area (PIPE) - OMS2

2. Create pipeline material – MM01
3. Create pipeline vendor – XK01 / XK02
4. Create purchase info record with Info Category Pipeline - ME11
5. Automatic account determination – OBYC
6. Maintain condition record for invoice settlement - MRM1
7. Pipeline settlement – MRKO
Issuing of Pipeline Material:
We can issue the pipeline material in MIGO screen by selecting

“GOODS ISSUE----OTHERS”
The possible movement types for issuing the pipeline material as
follows:
201 P Mvt - Consumption for cost centre from pipeline
261 P Mvt- Consumption for order from Pipeline
281 P Mvt- Consumption for network from Pipeline
291 P Mvt- Consumption for all Acc assignment from pipeline
let’s see the process flow for more understanding.
Before creation of material master, go to (t.code OMS2) and select
material type PIPE and click detail button here pipeline mandatory
checkbox is ticked by default and if you see that storage view is
not selected.
Mob. No: - 797577631
click on quantity / value updating, here qty/value update tick mark

is not required.
Mob. No: - 797577631
1. Create material master for pipeline material say for Gas
with material type PIPE (T code MM01)
 Select the Industry Sector & Material Type: - PIPE (Standard Mat. Type for
Pipeline Material).
 Select the Basic View for Material Creation & Enter Plant. It will not ask for
storage as Pipeline Material.
Material 368 created

Mob. No: - 797577631
2. Create purchase info record with Info Category Pipeline
(Tcode ME11)
 Enter the Material, Vendor, Pur.Org & Plant
 Select the Info Category as Pipeline.
In info record price and tax code is mandatory or else we can receive an error
in MRKO posting
Purchasing info record created

Mob. No: - 797577631
3. Post goods issue with (T code MIGO)
You can enter a pipeline withdrawal for an cost center (with movement type 201 P) or for order
(with movement type 261 P).
In the below screen it is issuing to cost center and special stock type is P
Material document 10001410 posted
You can see the accounting entries of pipeline consumption
A/c Payable for Pipeline : CR –
Consumption A/C: DR +
Mob. No: - 797577631
Note: Maintain condition record with (Tcode MRM1) to send pipeline settlement document to
vendor or else document number will not create during pipeline settlement.
Give the output type as KONS and select key combination
After giving the vendor number click on communication and enter required details and save it.
4. Maintain condition MRM1(Condition type KONS)

Mob. No: - 797577631
5. Now Do the Automatic Invoice Settlement by using T-
Code: - MRKO
Conclusion:
From the above steps, we can understand how the material flows directly into the production
process through pipeline or cable and how the material consumed even there is no stock
maintenance in storage location and how the pipeline liabilities are settled by using MRKO
transaction.

Pipeline Procurement

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Pipeline Procurement

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LinkedIn | Akash S K

What is Pipeline procurement in SAP MM

Important points to remember:

 There is no PO, No Goods Receipt, No stock for these materials.

Prerequisites for pipeline procurement:

1. Assign material type to valuation area (PIPE) - OMS2

Issuing of Pipeline Material:

We can issue the pipeline material in MIGO screen by selecting

click on quantity / value updating, here qty/value update tick mark

Material 368 created

 Select the Info Category as Pipeline.

Purchasing info record created

Material document 10001410 posted

You can see the accounting entries of pipeline consumption

A/c Payable for Pipeline : CR –

Give the output type as KONS and select key combination

4. Maintain condition MRM1(Condition type KONS)

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