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Exploration & Production

major projects common process


appraisal guideline

2006 BP
Limited.
All rights
reserved.
2007
BPInternational
International
Limited.
All rights
reserved.

In appraisal, we confirm project viability, create the overall business case and
make the key strategic decisions that drive project value for years to come. This
requires excellence in many dimensions.
This guideline has been developed based on the knowledge and experience of
our multi-discipline appraisal community including our top appraisal leaders; it
provides guidance to all involved in delivering appraisal excellence.
Through the consistent application of this guideline, we will ensure that we
create the right distinctive projects in Appraise and Select to support our strategy
of being the #1 projects operator.

Neil Shaw
technology vice president - projects & engineering

2007 BP International Limited

MPcp Appraisal Guideline

contents
context

overview

1 habits of great appraisal leaders

15

2 BP biases

21

2.1 Integration

22

2.2 Standardization

22

2.3 Full value characterization

24

2.4 Risk and uncertainty management

25

2.5 Natural pace

26

2.6 Quality through choice

28

3 appraise work process and activities

31

3.1 Entry to Appraise (Pre-appraise)

33

3.2 Appraisal planning

36

3.3 Appraise programme

46

3.4 Appraise-Select gate

58

4 select work focus and activities

65

4.1 Select programme

66

4.2 Define preparation

75

5 organization development and design

85

5.1 Business context

86

5.2 Key accountabilities

86

5.3 Organization development

89

5.4 Setting the organiaztion strategy

92

5.5 Staffing expectations

93

5.6 Roles and accountabilities

5.7 Organization design settings

6 toolkit

95
102

109

6.1 Core multi-disciplinary tools

109

6.2 Emerging tools

110

6.3 Facilitation process to support appraisal and development teams

111

6.4 Knowledge management tools

terms and definitions

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MPcp Appraisal Guideline

2007 BP International Limited

MPcp Appraisal Guideline

context

Our goal is to generate business value by delivering projects, which are efficient
in both capital investment and long-term operation. We will do this by consistently
creating distinctive projects and delivering them with world class execution. The
Major Projects common process (MPcp) is a key part of the overall project system
which is designed to support Strategic Performance Units (SPUs) in pursuit of this
goal. This system includes our people and processes, supported by networks and
functional authorities, guidelines, tools and good examples.

Project
Principles
App Sel Def Exe Ope
Dashboards
MPcp Elements
HSSE
MPcp
Subsurface Resource
Guidelines
Characterization
HSSE
Technology, Engineering &
Appraisal &
Technical Definition
Pre-development
Project Management & Execution
Engineering & Quality Mgt
Procurement & Supply Chain
Project Management & Execution
Management
Procurement & Supply Chain Mgt.
Project Services
Project Services
Organizational Capability

Organizational Design
Commissioning & Operational
Commissioning & Operational Readiness
Readiness
Risk Management
Performance & Risk Management
Knowledge Management
Knowledge Management
Resources

Tools

Templates

Examples

figure 1.1 MPcp and related guidelines


The MPcp document lists expectations for each of the ten elements of project
excellence, which shall be met before proceeding to the next stage of the project.
Associated with each expectation are a number of attributes that describe and
support the achievement of this expectation. These attributes are intended to guide
teams in developing their action plans for the stage and to drive consistently good
project performance.
The MPcp document also describes the governance process, including functional
attestation, required to meet the Group Investment Assurance and Approvals Process
(GIAAP).
2007 BP International Limited

MPcp Appraisal Guideline

context

Guidelines have been written for each of the MPcp elements to provide more
detailed support to teams in the achievement of MPcp expectations. They have been
compiled from the wisdom and experience that exist in the company and represent
the current view of discipline requirements and good practice, which should be
applied consistently across our range of projects.
Over time we expect the Major Projects community to identify improvements in
the practices described in these guidelines. These should be communicated to the
Directors of Appraisal within Exploration Production and Technology Function who have
clear ownership of this guideline and are accountable for its planned and systematic
update. Appraisal teams should adhere to and are responsible for implementing the
guidelines unless a material departure is considered to provide significant benefit.
Any proposed departure should be discussed with the Directors of Appraisal.

MPcp Appraisal Guideline

2007 BP International Limited

2007 BP International Limited

MPcp Appraisal Guideline

2007 BP International Limited

MPcp Appraisal Guideline

overview

BP carries a large and diverse appraisal portfolio. These originate from:


Successful Greenfield and Brownfield access.
Exploration success leading to standalone projects.
Hub tie backs, and increasingly from projects that exploit our very significant
Brownfield incumbent resource position.
The opportunities span Appraise and Select and also include others that have not
yet entered Appraise (in Pre-appraise or Access). BPs future depends on creating
distinctive projects with competitive returns from this portfolio.
Historical performance data shows a significant incidence of project wrecks is
caused by:
Inadequate business framing, e.g. governments, partners, geography.
Insufficient front end loading, e.g. technical definition, risk management,
contractor management.
Inappropriate target setting (including unrealistic pace).
Inadequate organizational capacity and capability.
Six biases underpin the delivery of improved appraisal performance in BP integration,
standardization, full value characterization, risk and uncertainty management, natural
pace and quality through choice. In combination, these biases lie at the heart of our
journey to be the #1 projects operator.

The Appraisal Guideline has been written to serve a diverse community, which
crosses multiple disciplines and functions involved in appraisal and the front end of
projects. It describes additional aspects that go beyond just supporting delivery of
MPcp expectations to provide:
Further information on appraise and select expectations.
Other important areas in delivering appraisal excellence and distinctive projects.
Examples of success with other tools and approaches.
Disciplines involved in appraisal are also involved in Access and Renewal, Exploration,
Opportunity Progression and Brownfield operations. These disciplines include
Subsurface & Wells, Drilling & Completions, Projects & Engineering, Operations and
Commercial.

2007 BP International Limited

MPcp Appraisal Guideline

Ecp

Exploration

MPcp

Major Projects

BtBcp

Beyond the Best

OPcp

Opportunity Progression
Base Management Excellence
Production Efficiency Improvement
Integrated Field Planning

BMcp
PEIcp
IFPcp
SPMcp

Supplier Performance Managment


Appraisal
Guideline

De-commissioning

Decline

ILX

Plateau

Infill

Ramp

Installation

Development
Case

First Oil
Appraisal

Prospectivity &
Development
Case

Access

overview

Appraisal
Guideline

figure 1.2 how Exploration & Production common processes relate over

the life of an asset
The fundamental emphasis is on integration that evaluates project opportunities,
improves front end loading and informs investment decisions. Figure 1.2 shows how
appraisal relates to the Exploration & Production common processes.
The Appraisal Guideline is organized in six parts.
1. Habits of great appraisal leaders
The habits are proactive behaviours leaders and teams must display and embed for
the creation of distinctive projects.
2. BP biases
This section describes the biases of BPs approach to appraisal that allow us to deliver
viable and robust projects.
3. Appraise work focus and activities
A codified and standard approach to the work focus and activities for BP projects in
Appraise to meet MPcp expectations and support teams as they form and build their
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overview

WorkFocus

Stage
Objectives

Appraise

Select

Confirm commercial viability of opportunity and identify a


range of development options consistent with resource,
uncertainty and market conditions, at least one of which is
viable technically and commercially

Evaluate the alternative concepts, seeking to maximize


opportunities whilst reducing threats and uncertainties
to an acceptable level, in order to identify the optimum
project to take forward into Define

Appraisal Planning

Appraise Programme

AppraiseSelect Gate

Business Framing

Opportunity Characterization,
Option Evaluation & Viability
Assessment

Viability
Confirmation

Option
Evaluation

Concept
Selection

Establish
selection criteria
Develop
engineering
data acquisition
programme
Evaluate options
Engage
contractors
Update risk
and uncertainty
management
plans
Update learning
and knowledge
management
plan

Select concept
Engage
and select
contractors
Deal structuring,
contract
framework,
market
development
and access

Governance

Activity

Appoint AGM
Generate options
Ensure full value
characterization
Consider all sources of value
and assess markets
Perform Value of Information
analysis and acquire data
Develop decision framework
and analysis
Consider standardization
options
Identify risks and uncertainties
and develop mitigation plans
Understand trade-offs
Establish reference case and
alternative options
Make informed decisions

Reconfirm
strategic
context and
business
objectives
Confirm
options
Build the
select team
Plan Select

Appraisal Plan
Coaching Workshop

Appraisal
Plan
Reserves Approval
Memorandum (RAM)
Legend

Concept
Definition

Appoint PGM

Build appraisal team


Consider business
drivers: resources,
developability, markets,
and external influences
Identify technologies
Identify risks and
uncertainties and
develop mitigation plans
Create learning and
knowledge management
plan
Understand
heritage commercial
arrangements

Appraise
Entry
Gate

Define
Preparation

Select Programme

Select
Entry
Gate

HOD Review

key document

Set targets
Build Define /
Execute team
Plan Define
Complete
Statement of
Requirements
Manage
residual risk
and uncertainty

IPA Review

Select Coaching
Workshop

Define Entry Gate


Discipline & HOD Reviews

Appraise
PHSSER
entry gate

Updated Appraisal
Plan and DSP
workshop

Select
PHSSER
review

IPA Review

RAM

Define
RAM
PHSSER

figure 1.3 road map for creating distinctive projects


work plans. A road map is used to illustrate the sequence of activities. Following
this road map is crucial to consistently create distinctive projects from BPs appraisal
portfolio.
The key work focus components are:
Appraisal Planning this includes business framing and strategy testing steps.
Appraise Programme describes option generation, opportunity
characterization, evaluation and viability testing through the Appraise stage.
Appraise-Select gate describes Appraise / Select transition and viability
assessment.

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overview

4. Select work focus and activities


Describes a codified and standard approach to the work focus and activities for BP
projects in Select to meet MPcp expectations and help teams to fully consider and
prepare for end-Select deliverables early.
The key work focus components are:
Select Programme describes selection criteria, concept evaluation,
commercial themes and concept selection through the Select stage.
Define Preparation includes concept definition, Define planning at the end of
the Select stage and target-setting.
5. Organization development and design
Describes the organization principles and design options for appraisal projects in
different settings in BP. This includes a list of roles and accountabilities for a standard
set of BP badged jobs in appraisal teams.
6. Toolkit
Contains a set of links to core integration tools, processes and document
templates.

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2007 BP International Limited

MPcp Appraisal Guideline

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1 habits of great appraisal leaders

Seven habits have been defined based on the experience of BPs senior appraisal
leaders and practitioners. The habits are proactive behaviours that leaders and teams
must display and embed within their project. They complement the habits of great
project managers described in the Project Management and Execution Guideline.
Creating distinctive projects

Delivering with world class execution

Appraise

Select

Define

Execute

Operate

HSSE Delivery and Leadership


Strategy
and Framing

Scope

Performance Management

Integration

Organization

Relationships

Risk and Uncertainty


Management

Contracting
Strategy

Planning Ahead

Evaluation and
Decision Making

Appraisal General Manager

Intervention

Project General Manager

figure 1.4 habits of great appraisal leaders

Habit 1 - HSSE delivery and leadership


Set the expectations, standards and behaviours for Health, Safety, Security and
Environment (HSSE) management of the project from the start.
Demonstrate their belief that HSSE delivery is paramount and ensure inherent
safety in the design of the selected project concept.
Recognize that design safety and operational integrity outcomes originate in
appraisal.

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1 habits of great appraisal leaders

Habit 2 - Strategy and framing


See the big picture and align diverse interest groups behind a clear description
of the opportunity, scope, scale, pace and complexity to inform early decisions
on organizational capability and capital requirements.
Facilitate the right conversations early regarding the business context and
strategic fit of the opportunity, including non-technical groups such as Gas,
Power & Renewables; Legal; Finance; Tax and Integrated Supply & Trading.
Understand the impact of the external context in which the project will be
implemented and how the resource owner, regulatory agencies, license
provisions, commercial framework, partner and business environment all affect
the running and delivery of the project.
Habit 3 - Integration
Create an environment of openness, inclusiveness, creativity and transparency
where integration of diverse project components, including technical and
commercial data by staff from different disciplines, can occur effectively.
Consistently simplify, summarize and communicate the project status with the
team and stakeholders to seek integration and deliver alignment.
Promote understanding and communication of the trade-offs and interdependencies in every decision before it is made.
Value and recognize the importance of all disciplines and have an active
interest in them.
Own the overall integrated business delivery, not just the project delivery.
Habit 4 - Risk and uncertainty management
Create a culture of understanding risk and uncertainty, followed by mitigation
of risk and reduction of uncertainty to appropriate levels over the life of the
opportunity.
Incorporate prior lessons learned (BP and industry) into risk identification and
mitigation.
Plan for multiple outcomes from the appraisal programme, have well thought
responses ready and communicate them, including recycle and exit.
Prepare flexible concept designs that mitigate a range of risk and uncertainty
outcomes.
Communicate residual risk, uncertainty and their impacts to senior
management and own residual risks.

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1 habits of great appraisal leaders

Habit 5 - Evaluation and decision making


Consider the widest possible range of opportunities and all potential sources of
value.
Always use concept and component standardization in evaluating opportunities,
including identifying technology requirements.
Be aware of the natural boundaries within a basin or area.
Have the ability to work with complex, ambiguous or limited amounts of datause benchmarks and analogues early to ensure options are not overlooked.
Avoid premature selection of options or concepts, particularly in Appraise, by
holding multiple options open until fully matured.
Test for team think and undue bias through frequent and informal peer input.
Focus on continually testing for viability throughout Appraise and Select.
Promote a culture where informed decisions are made in an environment of
openness and transparency. This will ensure quality through choice for all
decisions.
Base all viability, option, and concept selection decisions on full life cycle
economics and consider all sources of value.
Have an instinct for identifying problems early and intervene in a decisive and
timely manner.
Habit 6 - Organization
Build the integrated team early with sufficient depth, breadth and diversity to
deliver the project; avoiding the tendency to build teams too late and too small.
Be proactive in describing the consequences of organizational gaps to enable
the right choice in deployment of resources.
Assess people to ensure they are placed in roles based on their experience,
knowledge, development and character. Have a bias to expose the next
generation of leaders to challenging roles.
Create a motivating and inspiring environment which promotes informal
communication, ownership and a strong team culture focused on delivery.
Develop a performance management culture where teams understand their
performance data, forecasts and how to use them effectively.

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1 habits of great appraisal leaders

Habit 7 - Relationships
Identify and closely manage key external relationships.
Think carefully about reporting relationships to ensure alignment across the
team (contractors and BP staff). Work on weaknesses to resolve issues rapidly.
Continually test for communication problems and break them down.
Recognize the power of team building and co-locating staff from key disciplines
to create a high-performing team.
Create a credible upward relationship with senior management by raising and
tackling relationship issues early. Report the status of the project whether good
or bad.
Personal impact of great appraisal leaders
In addition to the seven habits, successful appraisal leaders demonstrate the
following traits:
High energy.
Ability to create focus for the team.
Ability to make hard decisions.
Respect and humility when dealing with others, especially external
stakeholders.
Positions team and stakeholders for success.
Is always aware of the project status whats going well and whats not going well.
Business acumen.
Resilience.
Keeps promises and delivers.

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2 BP biases

BPs distinctive approach to appraisal supports our objective of becoming the leading
projects operator. This approach is summarized by six biases which describe how our
appraisal teams work together, what they do and ultimately what they deliver. These
biases are:
Integration.
Standardization.
Full value characterization.
Risk and uncertainty management.
Natural pace.
Quality through choice.
Figure 2.1 depicts how the biases relate to the scope of the appraisal team.

Subsurface

Full Value
Characterization

Projects &
Engineering

ility
Viab
ty
ni
tu ter
or ac
pp ar
O Ch

Standardization

Integration

Business
Framing

Risk &
Uncertainty
Management

O
E v a p tio n
lu a t
io n

Drilling &
Completions

Appraisal
General
Manager

Commercial

Natural Pace
t
ep n
nc ctio
Co ele
S
Concept
Definition

Work Focus

Quality
Through
Choice
BP Biases

HSSE &
Operations

Disciplines

LEADER
INTEGRATOR
MANAGER

figure 2.1 BP biases and appraisal team scope


These biases map closely with the Project Principles which describe the high-level
BP Group approach to projects.
In the following sections we define these terms, how they make BP distinctive and
what this means for appraisal teams and practitioners.
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2 BP biases

2.1 Integration
Our drive for integration is based on the concept that the whole is greater than the
sum of the parts.
Integrated coaching is a key
component of MPcp. The
Appraisal Plan CoachingWorkshop
provides the foundation for
business framing and creates
cross-discipline alignment early
in Appraise. The Select Coaching Workshop supports integrated team thinking to
deliver the Select stage. This approach greatly improves team efficiency by creating
a focus on doing the right things. It also enhances knowledge transfer between the
various technical and commercial disciplines.
Integration is a behavioural characteristic
founded in the holistic, multi-disciplinary
(technical and commercial) approach BP
applies to appraisal.

For the practitioner, delivering integration involves:

Timely data acquisition guided by rigorous Value of Information (VOI) analysis.

Forming a multi-disciplinary appraisal team early and with sufficient depth,


breadth and diversity to deliver the project.

Co-locating appraisal discipline teams.

A team environment of trust and respect and a culture of humility when


dealing with other BP teams or partners, governments, regulators, and other
stakeholders.

All key project interfaces, internal and external, are well understood.

A high quality learning and knowledge management plan is in place and


actioned to ensure:

Relevant lessons (from BP and industry) are incorporated into Appraise


and Select activities.

Lessons learned from Appraise and Select are captured for future use by
others.

Objective analysis of trade-offs.


2.2 Standardization
The benefits of standardization are widely recognized. Standardization allows BP
to leverage its scope and scale in the market place; by working with common
technologies, some of the risk and uncertainty associated with an option being
evaluated can be more easily quantified and mitigated.
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2 BP biases

To fully realize the value of standardization, it must be considered


at the earliest stages of a project (i.e. in Appraise and Select).
Opportunities for standardization should be considered as part of the
Appraisal Planning process. The degree of possible standardization
should, at the very least, be a criterion for evaluating between
different options. Benefits can be realized from all disciplines.
The benefits of standardization are shown in figure 2.2.

Improved Operability/Reduced OPEX


Surety of start-up efficiency
Improved HSE from systems commonality
Commonality for spares and training
Improved uptime
Reduced Cycle Time

Not re-inventing the wheel - proven designs,


fully commissioned systems and processes
Simplified Execution - management of no change
Time

Reduced CAPEX
Repeat Engineering - design one, build many
Repeat contracts with key suppliers - equipment and services
Scarce resources deployed on what really matters
Efficiency of integration

figure 2.2 concept and component standardization


Benefits of concept standardization include reduced schedule, better ramp up and
operability, and lower capex. Component standardization (the reuse of earlier system/
major equipment designs) creates greater demand that can be leveraged through the
Procurement and Supply Chain Management (PSCM) segment sector strategies and
can also deliver the same benefits to projects.
While standardization creates an opportunity to minimize risk, it can introduce other
risks to a project. Evaluation of standard technology to demonstrate that an option
is technically viable should be just as rigorous as for any less well proven or new
technology. Standardization may also create an over dependence on a single vendor
across a number of projects which PSCM sector teams can help manage.
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2 BP biases

For the practitioner, delivering standardization requires:


Considering asset life-cycle costs and operability.
Considering how to get maximum leverage from BPs experience, scope, scale
and market position.
Balancing innovation and standardization.
Recognizing the value of SPU / programme optionality (e.g. sharing major
systems, sub-systems and components).
Open discussions with partners and National Oil Companies about the benefits
of standardization.
Considering and mitigating risks of standardization properly. Successful
deployment in other projects does not guarantee success in other situations.
Considering any extra resource risks if project pace is increased as a result of a
programme.
Checking that risks are not driven into other areas of the project.
2.3 Full value characterization
This bias recognizes while the value of a subsurface asset is heavily dominated by
its resource potential, there are many places that material value enhancement and
destruction can occur. Greenfield appraisal also needs to consider the impact on value
of other drivers such as cost and schedule. In Brownfield appraisal, value may be more
dependent on plant capacity or expansion possibilities. Full value characterization
includes consideration of:
Reservoir to market as BP is a fully integrated hydrocarbon company, part
of our distinctiveness is the capability to capture value from vertical synergies
across the entire reservoir to market value chain and horizontally across a basin
or capture area strategy.
Life of field evaluating opportunities and risks over the entire asset life.
Follow on potential accessing follow on opportunities outside the asset may
provide additional sources of value.
Considering the merits of a phased approach - to allow uncertainty reduction
while generating revenue.
Relationships for example, access to other opportunities in the country
resulting from a commitment of capital on the project under consideration.
Standardization and programme approaches can add value to executing
related projects.
Specific examples include leveraging infrastructure ownership to process or transport
third party production, novel commercial agreements that reduce capital risk,
standardized application of distinctive technologies to reduce cost or to increase off24

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2 BP biases

take rate and co-development of assets to share fixed costs and improve schedule.
At times, full value characterization may not necessarily be aligned with external
stakeholders. In such instances, relationships need to be managed to deliver
mutually satisfactory outcomes.
For the practitioner, delivering full value characterization requires:
Vertical and horizontal cross stream integration.
An understanding of the value added through the dimensions of life of field,
follow on potential, standardization and relationship opportunities.
An understanding of the value added through adoption of standardization and
programme approaches.
Assessment of value trade-offs within the business context.
Consideration of the opportunity cost of scarce resources (staff, equipment,
time etc.).
2.4 Risk and uncertainty management
Exploration & Production is a business where taking informed, well-judged risks can
secure competitive positions for BP, often with advantaged returns. Risk and uncertainty
provide a powerful basis for project and portfolio planning and are not inherently bad,
where project value can be created in a safe and responsible manner.
A risk is typically defined as an event (circumstance) that, should it occur, would
have a material effect on project value. Risk can result in a value degradation (threat)
or improvement (opportunity). Uncertainty is the mechanism for describing the
distribution of a parameter whose value is not absolutely known. It can be expressed
as a continuous range or as distinct alternatives. In appraisal it is important to divide
uncertainties into those which are irreducible and those that during appraisal may be
reduced with additional work or data. Uncertainty, or combinations of uncertainties,
when allied to investment decisions with expectations of delivery, may generate risks.
Not all parameters with uncertainty will be linked to risks.
Managing key risks and associated uncertainty is crucial to delivering project value and
success. Upside opportunity must be addressed as aggressively as downside risk.
In the early phases of a project the range of uncertainty is normally large. Informed
decisions demand complete transparency of all risks and uncertainties associated with
a project.

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2 BP biases

As our portfolio of assets is becoming more


complex and costs of traditional appraisal
activities are increasing, there will be
increased pressure to carry higher levels of
residual risk and uncertainty at end-Select. As
a result, concept selection should consider
flexibility implications and alternative facility
capacity and phasing as mitigations.

Understanding risk provides the


basis for performance management
and clear activity plans. The appraisal
teams objectives are to manage
uncertainty and enable informed
decisions under risk.

For the practitioner, delivering risk and uncertainty management requires:


Avoiding the tendency to focus more on subsurface risk to the detriment of
other areas, such as commercial.
Considering risk early, in Drilling & Completions, Projects & Engineering,
Operations, Technology implementation and Commercial, and understanding
the interdependencies.
Constructing and executing a risk management plan that addresses project
expectations (value) as established by the stakeholders. The risk management
plan should be transparent and use VOI analysis to inform activity decisions.
VOI is driven by a project risk register, an understanding of uncertainty and
Select stage (and beyond) decisions.
Mitigation planning to modify project threats to an acceptable residual level.
Identifying project opportunities to analyse, understand and improve value.
Information on risk tools can be found in the Exploration & Production Risk
Management Guidelines.
2.5 Natural pace
Natural pace describes the optimum speed for a project to progress to create
value and manage risk appropriately. It allows the team to deliver full project value
with confidence in meeting the target schedule. It requires judgement by senior
management, informed by appraisal team data, to make the right decision on the
pace of the project.
The key determinants of natural pace include:
Scale mega projects are more complex, have more uncertainty and take longer.
Complexity related to scale and level of technology challenge.
Technology challenges e.g. new or recently proved applications, enabling or
enhancing technologies.
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2 BP biases

Location specific issues e.g. physical or infrastructure access.


Regional environment e.g. new basin versus developed or mature basin.
Market expectations e.g. opportunity timing window constraints.
Commercial e.g. licensing and production sharing agreements, partner and
joint operating agreements, project financing.
Organizational capability and capacity constraints internal to BP and in the
external and contractor market place.
Regulatory considerations e.g. changing fiscal or environmental boundaries.
The right natural pace in Appraise and Select is fundamental for the
right work to get done. Cost and quality also need to be understood and
balanced with the project schedule to determine natural pace. Knowing
when to stop and being cost effective in Appraisal is fundamental.

Experience has shown that setting artificial or arbitrary schedule targets has been a
significant contributor to poor front end loading, poor project execution performance
and value extraction by external stakeholders.
For the practitioner it is critical to proactively communicate the natural pace of the
project. This requires:
Planning and executing activities that reduce risk and uncertainty to an
appropriate level.
Embedding standardization opportunities.
Identifying technology requirements, commercial framework and data
acquisition with long lead durations.
Accounting for the business environment of the project.
Understanding the true value drivers of a project (cost, schedule, quality
or production / resources) to differentiate between competing options and
projects.
Obtaining stakeholder approval.
Communicating the full range of schedule uncertainty to avoid the creation of
unrealistic internal or external expectations.
Senior management (comprising the Strategic Performance Unit Leader (SPUL),
Group Vice President (GVP) and Segment Executive Team), fully informed by the
Appraisal General Manager (AGM) and team, can then make business decisions
based on the full knowledge of natural pace.

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2 BP biases

2.6 Quality through choice


Quality through choice informs Portfolio
Management. It is founded on the concept
that more opportunities will be identified
than will ultimately be pursued. This enables
the selection of only the best options to
take forward in the portfolio. This approach
can be applied at both the portfolio level
(project prioritization) and the project level
(development options).

This bias enables focus and


prioritization of resources. There
should be a disciplined approach to
capital allocation and working within
organizational capability constraints.
Only the best opportunities should
attract and be allocated BPs
resources

Asset monetization and operatorship decisions are also supported by quality through
choice. All projects should carry and maintain an exit option to enable dilution or
divestment decisions to be considered (if appropriate) at key stage gate milestones.
BP currently operates 80% of its projects portfolio; however, appraisal teams should
consider the comparative benefits of others operating where they are equally
competent or even advantaged. In addition, the AGM should always consider
alternative ways to monetize the opportunity.
For quality through choice to succeed, there should be multiple options from which to
choose and these must be assessed consistently. The Segment common processes
play a crucial role to establish common language and a consistent set of expectations
that enable balanced assessments of options. The characteristics of high quality
projects include:
The project can be executed in a manner that is consistent with BPs HSSE
objectives.
Investment quality (investment returns and overall value) versus risk has been
considered and there is a compelling business case that includes all significant
sources of value consistent with SPU and segment strategies.
Embedded standardization and demonstrated learning from other projects.
The project benefits from integration with other BP assets or distinctive
capabilities.
The project is robust across a realistic range of schedule, cost and subsurface
uncertainties.
Key risks are managed and there is flexibility to capture upside opportunities.
There is adequate organizational capability to deliver the project.
The project enhances our broader capabilities and reputation, e.g. through new
technology or building internal expertise.
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The degree to which each of these characteristics contributes to the assessment


of quality will vary for each project and depend on the role of the opportunity in the
portfolio.
For the practitioner, delivering quality through choice involves:
Understanding the business context and strategy.
Considering multiple options and scenarios of future outcomes.
A consistent and objective approach to option comparisons.
A constant inquiry into the question of viability.
A constant inquiry into investment quality versus risk and uncertainty.

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The road map below shows the Appraise work focus and activities that support
creating distinctive projects in BP and delivering MPcp expectations. It also shows the
timing relationships of key activities and governance milestones including coaching
workshops, documents and functional reviews.

WorkFocus

Stage
Objectives

Appraise
Confirm commercial viability of opportunity and identify a range of
development options consistent with resource, uncertainty and market
conditions, at least one of which is viable technically and commercially

Appraisal Planning

Appraise Programme

AppraiseSelect Gate

Business Framing

Opportunity Characterization,
Option Evaluation & Viability
Assessment

Viability
Confirmation

Governance

Activity

Appoint AGM
Build appraisal team
Consider business
drivers: resources,
developability, markets,
and external influences
Identify technologies
Identify risks and
uncertainties and
develop mitigation plans
Create learning and
knowledge management
plan
Understand
heritage commercial
arrangements

Appraise
Entry
Gate

Reconfirm
strategic
context and
business
objectives
Confirm
options
Build the
select team
Plan Select

Appraisal Plan
Coaching Workshop

Appraisal
Plan
Reserves Approval
Memorandum (RAM)
Legend

Generate options
Ensure full value
characterization
Consider all sources of value
and assess markets
Perform Value of Information
analysis and acquire data
Develop decision framework
and analysis
Consider standardization
options
Identify risks and uncertainties
and develop mitigation plans
Understand trade-offs
Establish reference case and
alternative options
Make informed decisions

Select
Entry
Gate

HOD Review

key document
review

Appraise
PHSSER
entry gate

Updated Appraisal
Plan and DSP

workshop

PHSSER

figure 3.1 road map for creating distinctive projects


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MPcp describes the stage objectives and the expectations for BP projects. These
represent the overarching goals of the work focus and activities.
During early Appraise, an Appraisal Plan will be developed. The Appraisal Plan is a
formal document which outlines the scope of activities and estimated expenditure in
the Appraise and Select stages. Its focus is to enable an informed decision on project
viability and concept selection. It describes the first Depletion Plan for the field or
opportunity being considered. It should capture the opportunity from a life of field
perspective and consider the project phase and also operating the asset over the
long term. The Appraisal Plan provides a single point of reference for characterizing
opportunities.
The Appraisal Plan does not constitute financial approval. Individual Finance
Memoranda (FM) are required to release funding for each element of the Appraisal
Programme. The Appraisal Plan is the key governance document used to assure
delivery to MPcp expectations.
MPcp describes the governance expectations for BP Major Projects. The scope of
the Appraisal Guideline relative to MPcp and the principal components of governance
are shown in figure 3.2 below.
Creating Distinctive
Projects
Appraise

Select

Appraisal Plan

Governance

HoD Reviews
& TVP
Attestation

Integrated
Coaching

World Class Execution


Define

Define FM

Discipline
reviews
Appraisal
Plan

Select
Coaching

Appraise

Select

PHSSERs
Appraisal Guideline

Execute

Operate

Execute FM

Discipline
reviews
Execute Start-up
Define Health Efficiency
Review
Coaching check

Detailed Engineering
Pre-Sanction
Construction
Pre- start-up Operate

figure 3.2 project governance at the principal stages


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3.1 Entry to Appraise (Pre-appraise)


Pre-appraise describes the period immediately before an opportunity enters
Appraise.
An opportunity entering Appraise must have senior management
support. Clear expectations must be set based on an understanding
of the strategic context and country risk. Sometimes opportunities
emerging within existing business units will materially affect or
change strategy. It is very important to communicate these situations
to senior management early so that the right conversations and
decisions can occur.
The AGM is responsible for building the appraisal team which can include resources
from Exploration Access (Greenfield projects) or Opportunity Progression (Brownfield
projects). The steps to build the team and develop the organizational strategy for the
Appraise and Select phases of a project are described in section 5.
As the opportunity transitions to the appraisal team, all information completed in
the Pre-appraise stages should be transferred as part of a Management of Change
(MOC). If any of the documentation does not exist at the time of transition, it should
be developed during Appraisal Planning, prior to developing the Appraisal Plan. Ideally
appraisal front end loading occurs through some early appraisal team participation and
connectivity with the access stage team. This early awareness and pre-consideration
of appraisal objectives from the outset will help ensure the appraisal team is well
positioned for success. In some SPUs the Access / Appraise activity set may merit
the organization to develop early appraise teams to facilitate front end loading and
rapid follow on success planning.
Figure 3.3 shows the entry points into Appraise.

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Greenfield

Exploration
Success
Extension/
Tie Back to
Hub

Brownfield

New
Greenfield
Access

Appraise
/ MPcp

Incumbent
Resource
Position

New
Brownfield
Access

figure 3.3 entry points into Appraise

Greenfield projects
Greenfield resource development opportunities that lead to Major Projects typically
originate when a successful exploration discovery confirms the potential for a
commercial development, or when we acquire a Greenfield opportunity. MPcp and
the Exploration common process describe the expectations at handover between
the exploration team and the appraisal team. Greenfield projects include discoveries
that are candidate tie-backs to existing infrastructure.
It is vital that the MOC through the transition into Appraise is effective and includes:
Existing HSSE thinking from Exploration.
Agreement on transition process including a handover meeting.
Description of the opportunity including strategic fit, outline costs, schedule
and methods used to derive them.
Technical Assurance Memorandum identifying thoughts on developability and
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Hydrocarbons Initially In Place estimates, calibrated by the exploration well


results from the exploration team. Ideally appraisal teams will have had an
opportunity to interface with exploration teams to help typify assumptions for
pre-drill Long Term Plan / project characterization purposes.
Reserves Approval Memorandum and Reserves Support Package plus
supporting Depletion Plan with complexity and reservoir technical limit
assessments developed by the appraisal team but with the input and
experience of the exploration team as its foundation.
Key contacts and relationships identified (and existing Relationship
Management Plans and SPAs), commitments (including license or contract
obligations), outcomes from market assessments, access / regulatory reviews,
issues and associated opportunities and co-owner, joint-venture agreements
and relationship items.
Agreed ownership of significant previously identified risks (threats and
opportunities) as appropriate.
Early scenario-based outcomes describing the potential opportunity with a low,
mid and high case should be considered and captured in an Appraise Stage
Dashboard.
Associated opportunities for standardization and follow on potential have been
identified.
Post discovery developability assessment.
Record of any known contracting limitations (e.g., regional, infrastructure, host
government or partner requirements).
Record of lessons learnt during Pre-appraise and a learning and knowledge
management plan for Appraise.
A thorough data management handover plan.

Brownfield projects
Brownfield Major Projects originate when either, an option is progressed from a
SPU/business units Opportunity Progression Hopper, or an access deal is signed
to develop an existing discovered resource (often under an agreed bid with a capital
or work programme commitment). All business transformation of existing assets is
considered Brownfield.
MPcp and Opportunity Progression common processes describe the expectations
at handover between the asset or renewal team and the appraisal team. For new
access Brownfield opportunities, MPcp, with a combination of the Exploration

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and the Opportunity Progression common processes, may need to be followed.


Early involvement of senior functional and line management representatives is
recommended to guide opportunities until a more structured approach is in place.
As with Greenfield opportunities, effective MOC is vital. In addition to the Greenfield
project requirements from Exploration, Brownfield opportunities will require the
following from Operations:
The HSSE Management Plan.
The Safety & Operations Integrity Plan and Operations philosophy.
Asset Long Term Plan and Ultimate Resource Potential.
MOC procedure for existing operations.
Details of other BP interests in the opportunity (e.g. midstream or
downstream).
An Integrated Field Plan.
A Production Efficiency Improvement plan.
All of the required handover processes and transition meetings must take place, for
both Greenfield and Brownfield projects, before an Appraisal Plan Workshop is held.
3.2 Appraisal planning
The objective of the Appraise stage is to confirm the commercial viability of the
opportunity and identify a range of development options consistent with resource,
uncertainty and market conditions, at least one of which is viable technically and
commercially.
The work focus of Appraisal Planning covers:
Business framing.
Technology identification.
Knowledge management.
Appraisal Plan.
Business framing
The objective of business framing is to understand the issues, challenges and
opportunities and their potential impact on business value and delivery.
Internal studies of our projects, as well as industry studies, clearly show projects
inadequately framed at the front end seldom deliver the expected value. Conversely,
projects that put in the effort and rigor at the front end, to adequately frame the
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opportunity set, have a high probability of delivering the true business value.
Business framing is achieved through creating a shared understanding of project
scope, issues, drivers, decision criteria and boundaries and then identifying a range
of unique alternatives that help define the potential business value a project has to
offer consistent with SPU and BP strategy.
MPcp sets out the framework and expectations to create a distinctive project and
includes the provision for support, advice and guidance from integrated, coaching
events (Appraisal Plan Coaching Workshop and Select Coaching Workshop).
These coaching events, which are part of MPcp governance, are led by the appraisal
coaching team and supported by the Directors of Appraisal.
Who and how
The coaching workshops are structured multi-disciplinary events aimed at assisting
appraisal teams frame the business opportunity and develop the future work
programme through:
Understanding the strategic framework, business drivers and decision criteria.
Characterizing and transparently communicating the key risks, uncertainties
and opportunities.
Identifying / evaluating the project scope, development scenarios and business
options.
Prioritizing data needs to address the key risks, uncertainties and opportunities.
Considering standardization and global agreements.
Facilitating discipline integration and alignment.
Transferring learning and best practice across the organization.
Identifying resource needs for delivery.
Clarifying Functional Excellence Elements Expectations and Requirements.
Business framing at the Appraisal Plan Coaching Workshop helps inform the
Appraisal Plan. The Appraisal Plan is a fundamental governance document in MPcp
for the Appraise and Select stages. Technical and non-technical functions should
be consulted and involved in Appraisal Plan Heads of Discipline (HoD) Reviews
(commercial business development planning and analysis Finance Control &
Accounting, Shipping, Legal, Finance, Tax, Gas Power & Renewables, Integrated
Supply & Training, as appropriate). Appraisal teams are encouraged to establish
contact with the non-technical functions early.
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Approach
1. Collect and analyse key existing data by discipline
This data is collated and used to develop a baseline understanding of what we do and
do not know about the project. The 4 legged stool is used to develop the business
context, integrate the initial findings, identify key gaps and establish communications
lines across disciplines within the appraisal team. This simple structured approach (in
figure 3.4 below) is used to help integrate the discipline data and also to:
Understand and test the strategic context (project alignment with strategy).
Develop insights on discipline issues (uncertainties, risks, opportunities)
and identify interfaces and challenges across the disciplines with a focus
on Resource base, Developability (technical definition including technology),
Markets and External Influences.
Facilitate integration, alignment and informed decision making.

Strategic Context
Establish viability (strategic, technical and commercial)

Resource

Developability

Oil / gas
Fluid properties
Structural complexity
Stratigraphic complexity
Rates and reserves
Benchmarks

Site Characteristics
Drilling & Completions
Flow Assurance
Wells
Facilities needs
Infrastructure
Technology

External influences

Integration,
Informed Decisions,
Confidence

PSA / JOA terms


Host government needs
NOC needs
Partners, stakeholders
NGOs
Local organizations
Competitor and regulatory impacts

Markets
Price
Oil and gas sales
Market intelligence
Export options
Negotiating strategy
Contracting strategy
Market developments

figure 3.4 4 legged stool approach to business framing

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2. Define and agree on the project scope


The project scope should define what is in, what is out, and acknowledge the
boundaries, interfaces and dependencies. The stick model visually articulates the
project scope. It also causes team integration across the disciplines by graphically
characterizing the functional components. A clearly defined project scope provides
focus and alignment as the team moves forward. An example of a stick model
developed during a workshop is shown below.
Partners

BPs SPU Strategy


Market

Project Scope
Surface Facility

HPHT Equip Suppliers

Drilling
Options

HPHT BP Team

Pump

Onshore
Facility

Prod Riser Sys

USCG

Marine Vessel

Export System

Long Lead Suppliers


Subsea

IST

Well
Companions

Mid-Stream
MMS

Salt

Other Structures?

West Bump

East Bump
Operating Unit

Paleocene

Adjacent Structures?

figure 3.5 example stick model


3. Gain internal alignment on project drivers, decision criteria and boundaries
It is important teams understand how the project will be viewed and what the decision
making process will be. This helps the team establish screening criteria, prioritize
and focus their data gathering, frame business options and evaluate trade-offs. An
approach to agreeing and documenting drivers, decision criteria and boundaries is
shown below.
Once the multi-discipline team has an integrated understanding of the project scope,
drivers, decision criteria, boundaries, key issues and challenges, it is in a position to:
Clearly articulate the range of risks, uncertainties and opportunities the project
presents.
Identify the data needs (need to know) to make informed decisions.
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Absolute Project Boundaries


Work through Integrated Asset
Organization Structure
Confirm with IM Standards
(coordination with Ops)
Only Existing Regulatory
and lease contracts
Only CTD used for re-entry
(no grassroots CTD)

Stage Gate Decision Criteria


Identification of risks/uncertainties
Demonstrates Viable Business Case
(fully loaded)
Meets HSSE requirements
Organizational capability and
Resourcing plan
Technology delivery plan
Demonstrate capability to drill and
Complete well on a constant basis
Knowledge management plan
Establish impact on value of export
options

Shareholder Value

Corporate HSSE
Imperatives
1. GHSSER
2. Utilization of existing
infrastructure
3. Plan for Training project
personnel ( CTD, N2, Current
Ops Procedures )
4. Minimise gas venting and flaring
5. Establish optimimum footprint
6. Embed rigor on control of work
7. Meet IM standard
8. Incident and injury free
environment
9. Successfully managed SIMOPS
10. Successfully conduct PHSSER

BP Reputation
1. Comply with third party
contracts
2. Respecting landowner,
community commitment
3. Regulatory compliance
4. Proactive PR demonstrating
value of BP presence
5. Good rapport with contractors
6. Manage internal expectations
7. Progressing technology for
producing mature

Distinctive CTD&C
Capability for Tight Gas

Financial
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.

Utilization fo existing
infrastructure (IM)
Resource (NP4) progression
Manage project pace
Cost effectivness for life of field
Identify and manage long lead
items
Integrated schedule for project
operations/activitties
Incremental Reserves and
expected project profile
Recognize the technical
challenge (uncertainty)
Fully Integrated cost across all
project elements and interfaces
SPMcp, Supplier performance
management system
Establish space for learning
Unwavering Management
Commitment (funding)

1. Completion techniques
2. Establish tight gas Frac
techniques
3. Technique to Manage Hole
stability
4. Knowledge management
5. Lead industry in tight gas
recovery/development
6. Understand and establish
Intellectual Property position
7. Identify and close technology
gap
8. Identify and establish
organization capability

Good project drivers & decision outcomes

figure 3.6 example project objective hierarchy


4. Develop creative alternatives
These creative alternatives capture the range of business value the project has to
offer. This is best done as a two-stage process.
The objective of the first stage is to:
Capture the key decisions by discipline.
List the choices for each decision.
Identify the triggers (what do we need to know to make the choice?) under
each decision.
An overview table approach for documenting key decisions, choices and triggers is
recommended. Figure 3.7 is an example of an overview table.
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Capture
Total
Infrastructure
Low
Cost/
Minimal
CAPEX
Screen
Solution

Earliest
Oil

Reservoir
Pressure
Maintainence

Number of
Drill Sites

Development

Gas
Injection

Single

Dry Trees

Water
Injection

Multiple

Wet Trees

Combination
of Gas and
Water

Combination

Host Facility

Liquid Export
System

Gas
Management

Gas
Pipeline
System

Lease/
Purchase
Development

Tightly design to
capacity (Fit for
purpose)

TLP / SPAR /

Tie Back to
Infrastructure

Store in
alternate
horizon

Loop Existing
Line

Purchase

Build for
Expansion
(Equity)

FPSO

Offshore
Load

Export via
Pipeline

Stand-alone

Lease

Tie Back to
Infrastructure

PHA

Non-Pipeline
Solution

Lease to
Own

Flexibility to
Process

Build for
future growth
(Reservoir
Update)

Semi

Sub-Sea to
tie back to
host facility

Natural
Depletion

Triggers

New Build
Pipeline

GTL

Through
Existing
Host Facility

Offshore
utilisation
(electric power)

What else do we need to know?

Decisions

Choices

Investment themes

Mapped Investment Theme example

Triggers

figure 3.7 example overview table


The overview table allows multi-disciplinary contribution to brainstorming with
the purpose of identifying conceptual business scenarios/creative alternatives
(Investment Themes) that satisfy the decision criteria and project objectives.
The objective of the second stage is to select an example investment theme and
map it across the overview table. This ties together the unique set of choices that
satisfy the chosen investment theme. The purpose is to:
Understand the potential business value the project has to offer.
Define potential data gaps and needs. What are the critical data items and
when will they be available?
Understand key multi-discipline interfaces.
Develop a focused and prioritized activity and resource plan. This plan is used in
the creation of the Appraisal Plan.
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Technology identification
All technologies must be analysed to assess associated risks, but they should also be
selected with reference to the technology biases that have been developed for the
Exploration & Production segment. The biases are intended to ensure a consistency
of approach in the application of technology and form the foundation of our Major
Project Technology Plans, they are:



Highly predictable performance and integrity through inherently reliable


equipment and materials with supporting monitoring.
Component standardization linked to well-defined functional requirements.
Process automation allowing control capability from an optimized location.
Continuous optimization of operations and access to global know-how
through an Advanced Collaborative Environment (ACE).

See the Engineering and Quality Management Guideline for more information on
the biases. It is important to include an assessment of all technologies including
Subsurface & Wells, e.g. seismic imaging. After the preliminary selection of the
technology it is important for the project to understand the nature of the technology
it plans to utilise and a key step in this process involves determining whether a
technology is proven or unproven (new).
Proven technology is that practice or item which has been provided to BP before,
to the same specification and manufactured at the same location with the same
techniques, for use under the same known conditions.
Unproven technology is a practice or item providing a function which has not
previously been used in a BP project under the conditions appropriate to that project.
This definition includes both novel technology in familiar application environments and
existing (proven) technology in new application environments or in new processing
sequences.
In the context of Major Projects, unproven (or new) technology can fall into two
categories based on value:
Enabling - a technology critical to project success, without which the project
cannot be successfully implemented.
Enhancing - a technology upon which the project is not reliant, but if
successfully implemented would enable more value to be realized for the
project.
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It is important to note that all unproven technologies must have reached a certain
level of maturity by the end of the Select stage. The Technology section of the
Engineering and Quality Management Guideline provides much more detail in this
area and should be consulted, but the key point relates to Technology Readiness
Levels (TRLs) and by the end of Select any technology selected should be at TRL3.
A TRL value lower than this means the technology is immature and the project will
carry additional risk.
To maximize the value of new technologies and minimize the implementation risk
and uncertainty, multi-disciplinary reviews of project technology requirements for
each alternative development concept should be held early in the Appraisal Planning
stage, and refreshed after key data is acquired and the opportunity characterization
matures. The outputs from these reviews and updates will form the basis for the
technology section of the Appraisal Plan which should also contain a technology
development schedule.
The objective is to define not only the project specific requirements, but also to
assess how to implement key technology biases and technology levers into the
project. There must be a plan to get to the right technology choices by the end of
Select and a detailed technology delivery plan for Define.
Technology planning is addressed in more detail in MPcp, the Engineering and Quality
Management Guideline and the other common processes.
Knowledge management
Knowledge management leverages the unique diversity of experience, expertise and
general know-how that resides throughout BP and externally.
Knowledge management should be initiated early in Appraise. The implementation
of the knowledge management plan is crucial to risk mitigation and continuous
improvement.
For the practitioner, learning and knowledge management requires:
Capturing and applying relevant learning from other similar projects, including
those outside BP.
Transferring learnings to other appraisal teams and the Projects library.
Document control and the data management plan to support current and future
decision making.

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The AGM is accountable for ensuring a knowledge management plan exists and
is implemented. A knowledge management champion should be designated to coordinate this.
A variety of knowledge sources exists in BP including:
Appraisal coaching team.
Heads of Discipline.
Functional Directors.
Network leaders.
Subject Matter Experts / Advisers.
Segment Technical Authorities.
Chief Engineers.
Projects and Engineering shared learning system.
Projects library.
Projects forum.
See section 6.2 for further information. The MPcp Knowledge Management Guideline
also contains further information.
The Appraisal Plan
The Appraisal Plan is a formal document which outlines the scope of activities and
estimated expenditure in the Appraise and Select stages. The focus of the Appraisal
Plan is to enable an informed decision on project viability and concept selection.
The Appraisal Plan is the output of the Appraisal Planning stage. It sets a broad
framework for the activity plan from discovery to first production. The plan is
specifically the execution plan for the Appraise and Select stages.
The purpose of an Appraisal Plan is to capture current understanding of the ranges
of technical and commercial uncertainty and risks / opportunities. It also defines an
activity programme that will lead to robust, compelling and viable business options
to be carried into Select. The Appraisal Plan provides the team and the Executive with
an opportunity to endorse or comment upon the full activity set envisioned during the
Appraise and Select stages at a time when it is most meaningful. A robust Appraisal
Plan also allows the team to deliver that activity set within the strategic bounds of
the endorsed plan.
The appraisal team should create the Appraisal Plan by addressing the questions in
the Appraisal Plan contents table in figure 3.8.
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Questions

Examples

What are the key issues that need to


be addressed for a viable business
opportunity?

Values, risks, uncertainties,


opportunities, options

What information do you need to


address the issues?

Value of Information analysis,


benchmarks

How will the team get the required


information?

Organization capability and capacity


Funding availability and utility

When is the information required?

Activity sequencing
Critical path - optimization of information

What is the most likely program critical


path and dependencies?

Understand the key decision making


interactions - Decision tree(s)

figure 3.8 appraisal plan contents


An Appraisal Plan is required for all potential Major Projects from new exploration
discoveries to Brownfield opportunities. It should be initially developed as soon
as practical after a discovery or selection of an opportunity from the Opportunity
Progression hopper or provided through a new access arrangement. The plan will
be cross-disciplinary and an integrated assessment covering front end loading
activities for key opportunities, risks and uncertainties, including technology. Market
opportunities for market facing projects should also be included in the Appraisal
Plan.
Other discipline specific support processes and standards, such as resource
compliance reviews, will underpin the Appraisal Plan.
The Appraisal Plan will be reviewed with the HoDs and approved by the project
Gatekeeper - usually the SPUL or GVP. The Gatekeeper will be agreed by the GVP or
appropriate authority. Technology Vice Presidents (TVPs) are required to attest to the
adequacy of Appraisal Plans. This is informed by the HoD reviews. Progress against
the Appraisal Plan will be monitored through the Quarterly Performance Review
process with the GVP.

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The Appraisal Plan should be fit for purpose and as short as practical. It is not intended
to contain all the support material necessary to underpin the recommended activities.
It should be derived from cross-disciplinary integration, addressing all of the key risks
and uncertainties which impact the decision on project viability and commerciality,
including:
An evaluation of the strategic fit of the opportunity.
A strategic review of BPs opportunity position versus the competition in the area.
Well evaluation and new data acquisition including the need for appraisal
well(s), additional seismic data and reprocessing existing data.
Feasibility studies on the host facility capability and performance, including
compatibility of produced fluids when Infrastructure Led Exploration or tiebacks are an option.
Identification of potential development options and associated costs and schedules.
Preconceived options may not always be the optimal choice or decision.
Identification of any new technology which requires early investment to
execute the project.
Organizational capability necessary to carry out activities within the proposed
schedule.
An update to the Appraisal Plan will form the Decision Support Package for the
Appraise-Select gate.
A template for the contents of the Appraisal Plan is provided in the Projects Library.
See section 6.2.
3.3 Appraise programme

The need to know information and data and the perceived impact on the key
decisions, as discussed in business framing (section 3.2), drives the activity set
definition in the Appraise Programme.
The Appraise Programme activities focus on assessing which combination of sources
of value (in a risked sense), result in the greatest overall value impact. The activities
should also focus on demonstrating viability.
The Appraise Programme will not mitigate all risks. Residual risks must be owned,
planned for and managed by the team beyond the end of Appraise.
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The Appraise Programme activity set comprises:


Opportunity characterization.
Option generation and evaluation.
Risk and uncertainty understanding and management.
Data acquisition programme.
Decision making.
Technology plan.
Contracting and procurement strategy.
Commercial themes.
Long-lead work may need to be initiated to optimize project delivery. Examples
include a technology maturation program, acquisition of development quality 3D seismic and / or collection of seafloor stability and metocean data for offshore
projects. Decisions to gather this information must be consistent with VOI strategy.

Ris
k/U
nc
ert
ain
ty

The proportions of known, need to know and residual risk and uncertainty change
over time as a result of risk and uncertainty management and data acquisition. See

RRU

RRU

Need
to Know

Need to
Need
to Know
Know

Need to
Know
Known

Early Appraise

RRU

Known
Known

Known

End Appraise

End Select

RRU = Residual Risk & Uncertainty


Need to Know as justified by VOI

figure 3.9 appraisal impact on risk and uncertainty


figure 3.9.
The Appraise Programme is complete when data for the need to know has been
addressed sufficiently to enable informed decisions between concept options during
the Select stage. All significant sources of value, development options, and options
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that will be further evaluated during the Select stage, will have been identified.
Entry into Select requires that there is a minimum of one technically and commercially
viable option. Viability is described in MPcp. Commercial viability requires an
expectation of positive net present value and of sufficient investment quality
(Investment Rate of Return).
Section 3.4 describes the specific deliverables and governance requirements at the
Appraise-Select gate.
Opportunity characterization
Opportunity characterization is the key to creating distinctive value from an asset
relative to our competitors. As an opportunity is characterized in more detail, the
Appraisal Plan should be updated to provide a central repository of information.
To understand the degree of this distinctive value, potential opportunities are characterized
with an integrated, full value approach that includes initial assessments of:
Strategic fit how well is the opportunity aligned with segment and SPU strategies?
Full value characterization, particularly those derived through synergies with
other BP assets.
The primary risks and uncertainties to delivering value from the opportunity.
The resources and organizational capabilities required to progress the opportunity.
Potential to leverage BPs unique know-how, experience, or technologies
including the potential benefits of standardization.
Figure 3.10 shows how opportunities evolve through options into concepts as a
project develops. These terms are the standard approach taken in this guideline to
describe project evolution.

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Option 
Opportunity
Option 

Concept

Option 1

Project

Option 4

figure 3.10 opportunity and options in project evolution


Option generation and evaluation
Option generation and evaluation is a core work focus during Appraisal. Options are
mechanisms to deliver value from opportunities. If we design facilities with a certain
amount of flexibility, we may have the option to reduce some of our investment risk by
processing third party production. A few options will be obvious and easily identified;
others will need a structured approach. A reference case must be established to
compare options.
The key to option generation is to understand the risks and opportunities. Steps
include:
1. Developing tactics to align stakeholders.
2. Refreshing the overview table created during the business framing workshop.
Ensure the top eight to ten Select stage decisions are represented.
3. Mapping the relative sequence of Select stage decisions in reverse order
begin with the end in mind and identify dependencies between the decisions.
4. For each major decision, brainstorm the alternatives and develop a list of
reasonable options from which to choose.
5. Developing initial screening criteria and ranking options to identify the three to
four options to be carried forward into Select.
A very wide set of options should be maintained during the early Appraise Programme.
Although boundaries help constrain and focus a teams efforts, too many boundaries
may prematurely eliminate options and adversely impact cost, schedule or risk. Too
many boundaries may also impact team buy-in and ownership of the project.
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Risk and uncertainty understanding and management


Characterization of the risks and uncertainties lies at the heart of a good Appraisal
Programme. A comprehensive understanding can be used to devise the work plan
for the stage ahead. The detailed treatment of risk and uncertainty will change as
the project moves from Pre-appraise into Appraise and on into Select. This change
reflects the objectives of the specific MPcp stages.
The risk and uncertainty management objectives in Pre-appraise are to characterize
uncertainties in the resource base, understand developability and identify the key risks
and opportunities to a technically and commercially viable project. The appraisal team
must consider alternative scenarios to capture a full understanding of uncertainty.
This should include describing the shape of the uncertainty envelope does the
uncertainty distribution have a flat top? Is it skewed? How good is the definition?
This characterization identifies what data must be collected and studies performed.
In Appraise this includes the elements in the 4 legged stool (figure 3.4) and:
Appraisal wells targeted at increasing reserves, or increasing the confidence in
reserves and calibrating wells cost uncertainty.
Understanding rock, fluid and log data required to help typify reservoir performance.
Reprocessing and new acquisition of seismic data.
Gathering cost and market data.
Analogue and benchmarking studies..
Technology requirements for the development to proceed.
Government or other political risk.
Articulating any non-traditional aspects of the project risk profile (e.g. HPHT,
high sulphur crudes, etc.).
By the end of Appraise, sufficient resources should have been established to be
confident the project is viable in the context of expected contractor market conditions.
Enough studies should have been completed as part of the Appraise Programme
to establish there are no fundamental barriers to development. Residual risk and
uncertainty carried beyond the end of Appraise must be owned by the select team in
situations where a business choice has been made to carry risk into Select.
By the end of Appraise, detailed characterization of uncertainties and risks will have
been carried out, focusing on those that may differentiate between development
options. For example, the project may have a choice between a tie-back to an existing
facility or a standalone development. In this example, the key uncertainties and risks
that will differentiate between development options are:
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Timing of capacity in the existing facility and likelihood of access rights.


Impact of Brownfield work on existing production.
Size of resource to be developed a larger resource would favour a standalone
development. Determining this may require further data collection.
Flow assurance characteristics a critical differentiator when considering tiebacks.

Figure 3.11 shows the expected volume increments per penetration from the Gulf
of Mexico. It illustrates how the tie-back versus standalone decisions depend on
resources, and how this was used to inform development decisions.
Resources
500
Best Fit Volume down to mapped spill point
Current Location 600 above spill @ M51, LKO

Local
Host

400
Deep S/T

00
Grey
Zone

OWC S/T

00
Initial Well

SS
Tieback

100

5
0/

Se


M

al
iti
In

48

P
en
.

5
Se
g

54
Se
g

51
M

Se
g

Se
g

51

Reservoir segments
figure 3.11 example of risk and uncertainty management from the Gulf

of Mexico
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Once risks, uncertainties and opportunities have been considered, the data and
studies needed to resolve them will form the basis of the Appraisal Programme.
Establishing the business drivers of a project helps to facilitate quality trade-off
discussions and decisions. It is essential to develop the drivers early and in concert
with the projects internal and external stakeholders. Risks and uncertainties, their
impact and mitigations need to be clearly stated in the Appraisal Plan.
Tools available to identify, assess and design mitigations for risk and uncertainty
include:
Risk register single location for recording project risks.
Risk matrix Boston square describing the probability / impact and manageability.
Risk Assessment Tool assesses relative risk.
Decision trees enable responses to Appraisal Programme outcomes in advance.
Design Structure Matrix investigates links between data acquisition and risk
reduction via system dynamic models.
Recommended practice for framing, assessing and managing subsurface risk and
uncertainty is described in the Reservoir Uncertainty Statement & Management
Guideline. Additional information on risk and uncertainty management can also be
found in the Geoscience Handbook and Exploration & Production Risk Management
Guideline.
Data acquisition programme
The objective of the appraise data acquisition programme is to gather need to know
data to inform viability. VOI analysis compares the relative value of appraisal data
and assesses its impact to assist determining project viability. It allows the Appraisal
Programme to focus on acquiring the most important data.

VOI is founded on the concept that data has value only if:
The data impacts current or future decisions that have uncertain outcomes.
The cost of obtaining the information does not exceed the risked value
derived from the data.
The struggle is to recognize when further appraisal spend does not materially
impact development decisions and therefore begins to erode value from the
opportunity. See figure 3.12.
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Risked Value of Opportunity

Optimal
Appraisal
Spend

Appraisal Cost
figure 3.12 understanding value of information
The data acquisition programme must encompass technical information and
sources of information from non-technical disciplines that will allow the appraisal
team to evaluate the viability of the opportunity. Consideration must be given to
the data required throughout field life, e.g. reservoir surveillance data for reservoir
management purposes.
Technical data gathered for Greenfield non-programme opportunities is biased
towards defining the ranges appropriate for selecting the potential development
concept. Opportunities that are part of a programme have data gathering biased
towards confirming viability of the existing or previously selected concept.
There are two types of information required:
Characterizing the range, type and anticipated production performance of
resources available for development including uncertainties.
Characterizing concept options, developability and associated costs and
schedules.
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Developability and concept choices are influenced by:


Hydrocarbon phase - oil, gas, condensate, water.
Recovery factors - in place volumes and recovery process and efficiency.
Production rates - individual well potentials and productivity.
Reservoir connectivity - pressure communication, connected volumes.
Fluid chemistry - including contaminants that impact materials selection or flow
assurance (H2S, CO2, mercury, wax, hydrates).
Rock mechanics - impacting potential well trajectories, pore pressure
prediction, completion types etc.
Geographic location and proximity to infrastructure / markets.
Geotechnical environment - water depth, seabed or surface instability and
hazards, rock strength and foundation engineering calibration.
Location of any required hydrocarbon processing.
Secondary recovery considerations artificial lift, water injection.
Drilling & Completions scope.
Production facility thresholds and conceptual flexibility.
Technology requirements.
Final commercial value.
Life of field considerations.
The Appraisal Programme should be balanced to better understand the range of
uncertainty for cost and schedule information, engineering options, resource scale
and definition.
Decision making
Making quality decisions is crucial to the success and efficiency of appraisal
programmes and the project. Appraisal practitioners must always test: What are the
impacts of my decisions? What is the regret position of my decision if we decide
not to proceed? A balance between testing the impacts and being unable to make a
decision under uncertainty is needed.
Most of the time in Appraise, and frequently in Select, these trade-off decisions require
judgement and experience as much as detailed evaluations. Knowing when to ask for
guidance is important. The potential impact of an incomplete or poor decision should
dictate the effort that goes into informing that decision. Identifying all stakeholders
impacted by or requiring buy-in to the decision is always useful. Understanding the
number and requirements of the stakeholders also helps determine how consultative
the decision making process needs to be.
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There are a number of excellent tools available to enhance the rigor and completeness
of decision making. Decision trees are one tool which can enable the outcomes of the
Appraisal Programme to be planned in advance. In this way, an objective assessment
of Appraisal Programme options can be developed and outcomes can be thoroughly
communicated as means for everyone to understand uncertainty and risk. Decision
trees can be used to evaluate the relative value of different decision pathways (using
Expected Monetary Value). They also inform concept selection choices linked back to
Appraisal Programme outcomes. Figure 3.13 is an example of a decision tree used to
evaluate Appraisal Programme outcomes.
3-D shows no
structure, drop Lease
-$15 MM

Buy

0.4

Run 3-D
survey

Lea
se

Drop Lease
$-18MM

Drop Lease
-$15 MM

e
as
Le
uy
b
nt $0
Do

3-D
con sur v
ey
firm
s
0.5 lead
5

Drill

y
Dr

Drill second
wildcat

le
ho
0
6
0.

0.15

0.2
5

Dry hole
drop Lease
-$21 MM

0.

45
0.35
0 .2

Mid Case Discovery


+$18 MM

Mid Case
Discovery
+$24 MM
High Case
Discovery
+$99 MM

High Case Discovery


+$102 MM

Dr

Drop Lease
-$12 MM

Dry hole
Drop Lease
-$15 MM

High Case
Discovery
+$108 MM

Drill
seco
wildc nd
at

Mid Case
Discovery
+$33 MM

0.
90

0.10

0.1
0

yh
0 . 8 o le
0

0 .0 5

0 .0 5

Mid Case Discovery


+$30 MM

High Case Discovery


+$105 MM

figure 3.13 example decision tree


Appraisal practitioners must consider concept and component standardization to
simplify and focus Appraisal Programme decision making. Where a programme
standard exists, appraisal decisions are often simplified and work is reduced.

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Decision making is often informed by considering trade-offs. Typical trade-offs include:


Longer-term versus short-term value.
Capex versus opex and other financial trade-offs.
Cost versus schedule versus quality.
Simplicity of concept versus recovery maximization.
More complex trade-offs occur around qualitative issues tied closely to risk and
uncertainty management. These include trade-offs between remaining resource
uncertainty and engineering concept flexibility.
These trade-off decisions must be considered in the context of the SPU and segment
strategies.
Technology plan
The Technology Plan will be an integrated part of the Appraisal Plan.
Details on Technology Planning and the content of a Technology Plan can be found in
the MPcp Engineering and Quality Management Guideline. Exploration, Beyond the
Best and Opportunity Progression common processes also contain useful information
regarding technology work plans for other functions.
The Technology Planning process will reveal the maturity of technologies being
considered, the associated risk and drive the subsequent development activities.
Contracting and procurement strategy
Early contracting strategy work can assist identifying risks and opportunities.
Contracting risks can create boundaries on a project and recognizing these early can
help to prevent the development of unrealistic delivery and timing expectations for
the project. It may also create opportunities, for example, using local content to build
alignment with local partners and host governments creates negotiating currency
which can be used by the project. Exploration & Production PSCM sector strategies
provide the context for contracting and procurement at this stage.
Standardization can significantly simplify and improve contracting thinking and
efficiency in Appraisal, especially where an existing programme standard can be
used as the basis for considering concept options.
Additional guidance is provided in the MPcp Procurement and Supply Chain
Management Guideline.
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Commercial themes
During Appraise the key commercial themes to address include:
Opportunity characterization
Do we understand the business drivers?
Are our objectives aligned with our partners and with government?
What business model makes money for BP, our partners and government?
Have we evaluated the value proposition for BP, competitors, partners and
government?
Who are the competitors, what are they doing and how will they respond to
our actions?
What is our distinctive advantage? Is our offer distinctive?
Why should the stakeholder choose to work with BP? What options do we
have for improving our offer? For example, gas and infrastructure.
Is our competitive position sustainable?
How does the opportunity fit with the area or basin catchment strategy?
Relationship management
This is focused on external stakeholders.

Do we know the key people to influence and who makes the decisions?

Have we prepared a relationship map and do we have a plan for managing


relationships?

Do we understand the country constitution and legislative framework as it may


apply to the BP project?
Reputation management

What are the implications for our reputation?

How best do we protect and enhance our reputation?

Is the risk commensurate with our interest and the returns we may earn?
Market assessment, development and value chain management
This is principally through Gas, Power & Renewables for gas and gas products.

Have we conducted a full value chain market assessment?

What is the market structure and regulation?

How is the gas market developing?

Is there a programme of product market analysis to support pricing assumptions?

Are there fundamentals that drive market growth?

How does the product get to market and do we know the cost of access to
market?
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Legal, fiscal, financial and regulatory management

Are there any existing agreements which impact the selection criteria? For
example, Joint Operating Agreements and Production Sharing Agreements.

Can we define any key conditions precedent for the Appraise / Select stages?

Are corporate structures and local / national tax regulations understood?

Do we understand and have we taken into account the impact of local laws
including competition law and the business and energy market regulatory
framework?
Economic Evaluation

Have we developed a range of commercial scenarios to broadly evaluate each


option against and evaluate the reference case in detail?

Do we understand the value levers? Would a value tornado chart be useful


to communicate the most impacting parameters of the project or of the
underlying project uncertainty provinces?

How does the reference case make money?

What is the full value characterization (upstream, midstream and downstream)?

What concept selection methodology will be applied in early Select to rank


options?
Having reviewed the commercial themes, appraisal teams should know what the
critical path items are and have built them into the Appraisal Plan / Decision Support
Package as part of demonstrating viability. These link to the objective hierarchy
established in section 3.2.
3.4 Appraise-Select gate
The fundamental question to address at this gate is viability. By the end of Appraise,
sufficient additional information should be available from the Appraise Programme to
inform both technical and commercial viability. If viability cannot be demonstrated,
the project must be stopped or recycled. Under all circumstances, this gate offers
the opportunity to consider the best way to create value. Partner alignment should
be sufficient to proceed into Select.

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Entry into Select requires a minimum of one technically and commercially viable
option, where viable is defined as:

Do-ability technical description and technology needs must have no


foreseeable show-stoppers.

Markets - expectation of access to markets (especially gas) and to


fabrication and installation contractors.

Relationships (external influences) relationship management plan must


be in place, stakeholders are aligned with forward plan.

Economics (deterministic) expectation of a positive NPV.


The appraisal team must prepare an updated Appraisal Plan which will form the
Appraise-Select gate Decision Support Package. This enables a functional check-in
on the key elements including strategic fit. The appraisal team must be prepared to
implement the updated Appraisal Plan and be set up to enter Select.
The Decision Support Package should also confirm and describe the alternative
options recommended to carry forward into the Select stage. At least three options
including the reference case are normally taken forward into Select.
The role of the Gatekeeper is to test for readiness and viability in a formal review. If
these can be confirmed then movement of the project from Appraise to Select can
be approved. The Gatekeeper is also responsible for ensuring the AGM and appraisal
team have the required resources and context through Appraise and Select. There is
no formal requirement for a HoD Review and TVP attestation at the Appraise-Select
gate. The Gatekeeper (normally the SPUL) is encouraged to consult functionally
regarding the investment quality, portfolio fit, and risks for the project. HoD checkins are recommended, particularly for projects that have spent over three years in
Appraise.
Figure 3.14 shows the full set of documents called for in MPcp that underpin delivery
of Appraise (and Select) stage expectations. Blank boxes denote the deliverables not
specifically required by MPcp at end-Appraise.

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3 appraise work focus and activities

Key Deliverable

End Appraise

End Select

Appraisal Plan

Updated

N/A

Wells Basis of
Design (BoD)

Preliminary
Prepared

Finalized

Scenario Planning

The business case for the


development scenarios is
supported by appropriate
schedules and cost
estimates.

Project Statement of
Requirements (SoR)

Outline Prepared

Complete

Life of Field Plan of


Development (PoD)

1. Scoping plan prepared for


each option.

1. Available for the Reference


Case

2. Outline plan available for


the Reference Case

2. Available for each option


which tests robustness to
upside and downside
outcomes

Surveillance Plan

Outline Prepared

Plans described in Depletion


Plan

Technology Plan

In Place

Updated

Front End Loading (FEL)

Current/Predicted FEL
Assessments complete

Engineering Basis
of Design (BoD)

Available for selected


concept

Project Execution
Plan

In place and outline communicated to team members

Operations and
Maintenance Strategy

Draft Developed

Commissioning
& Start-up Plans

Updated for selected concept


Outlined sufficiently to identify
issues relevant to Define

Relationship
management plan

Preliminary plan prepared

Being implemented

Interface Management
Plan

Outline Plan Drafted

Draft Plan Prepared

Organization Strategy

Drafted sufficient to identify


major issues, limitations and
opportunities.

Developed through to and


including handover to
Operations

Knowledge
Management Plan

Established

Updated

figure 3.14 key deliverables and expectations at the end of Appraise



and Select

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A RACI chart showing the key MPcp documents and deliverables is on the following
pages. This describes which of the key leadership roles in the appraisal team owns
each deliverable. Bold elements denote the single points of accountability.
In addition to the key deliverables at end-Appraise the appraisal team must also meet
the expectations for each of the MPcp elements.

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e
rc
ou

P
M roje
an ct
ag R
er es

A
M ppr
an ais
ag al
er G
e

at
o
in
rig
O

oc
um

en

ne

ra

3 appraise work focus and activities

Appriasal Plan

Appraisal General Manager

Reserves Approval Memorandum (RAM)

Project Ressource Manager

Reserves Support Package (PSP)

Project Ressource Manager

Scenario Planning

Appraisal General Manager

Organizational Strategy

Appraisal General Manager

R/A

Technology Plan

Appraisal General Manager

Risk Matrix and Risk Management Plan

Appraisal General Manager

Knowledge Management Plan

Appraisal General Manager

Project Execution Plan

Project Dev. Manager

10

Preliminary Contracting Strategy

Project Dev. Manager

11

HSSE Plan

Operations Dev. Manager

12

Relationship Management Plan

Appraisal General Manager

13

Interface Management Plan

Appraisal General Manager

14

Drilling and Completions Uncertainty


Statement (DCUS)

Wells Programme Manager

15

Reservoir Uncertainty Statement and


Management (RUSM)

Project Ressource Manager

16

Statement of Requirements (SOR)

Project Dev. Manager

17

Operations and Maintenance Strategy

Operations Dev. Manager

18

Depletion Plan

Project Ressource Manager

19

End Appraise Decision Support Package

Appraisal General Manager

R = responsible; A = accountable; C = consulted; I = informed

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C
M om
an m
ag er
er cia
l

O
D pe
ev ra
el tio
op n
m s
en
tM
H
an
SS
ag
E
er
M
an
ag
er
Pr
M oje
an ct
ag G
er en
er
al

m
am

P
M roje
an ct
ag D
er ev
e

lo
p

en
W
M ell
an s P
ag ro
er gr

3 appraise work focus and activities

R = responsible; A = accountable; C = consulted; I = informed


figure 3.15 RACI chart of the key Appraise stage MPcp documents and deliverables
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4 select work focus and activities

The objective of Select is to evaluate the alternative concepts, maximize the


opportunities and reduce risks and uncertainties to an acceptable level, in order to
identify the optimum project to take forward into Define. An increased focus on cost
and schedule definition is essential.
The Select stage principally involves sequential work across two key areas:
1. Select Programme - focuses on work to evaluate and enable the necessary
selection from an options shortlist brought forward from Appraise.

Evaluate the alternative concepts, seeking to maximize opportunities


whilst reducing threats and uncertainties to an acceptable level, in
order to identify the optimum project to take forward into Define

WorkFocus

Stage
Objectives

Select

Define
Preparation

Select Programme
Option
Evaluation

Concept
Selection

Concept
Definition

Establish
selection criteria
Develop
engineering
data acquisition
programme
Evaluate options
Engage
contractors
Update risk
and uncertainty
management
plans
Update learning
and knowledge
management
plan

Select concept
Engage
and select
contractors
Deal structuring,
contract
framework,
market
development
and access

Governance

Activity

Appoint PGM

Select
Entry
Gate

Set targets
Build Define /
Execute team
Plan Define
Complete
Statement of
Requirements
Manage
residual risk
and uncertainty

IPA Review

Select Coaching
Workshop

Define Entry Gate


Discipline & HOD Reviews

Select
PHSSER
Legend

key document
review

RAM

entry gate

Define
RAM
workshop

PHSSER

figure 4.1 road map for creating distinctive projects


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4 select work focus and activities

2. Define Preparation - focuses on work to mature the selection in readiness for


transition into Define.
4.1 Select programme
The overall appraisal scope employs the term options to describe alternative
development approaches in Appraise; it maintains this term through the first half of
Select until a concept selection choice is made.
The Select Programme objective is to achieve sufficient technical and commercial
maturity for each shortlisted option to implement a selection process based on predefined criteria.
Decisions

Option 
Opportunity
Option 

Concept

Option 1

Project

Option 4

figure 4.2 opportunity, options and decisions in project evolution


Select coaching
Business framing, described in section 3.2, underpins the creation of the Appraisal
Plan and provides the context and framework for execution of appraisal activities. In
the early Select stage this process is revisited to ensure shortlisted options and the
Select work plan remain aligned and that the select team has full ownership of this
alignment and all boundary conditions.
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The Select Coaching Workshop can provide support for Appraise insights and building
on any screening criteria employed during Appraise. This workshop helps the team
plan for Select and prepare for the Define FM. It also assists preparation for Select
stage deliverables and an external benchmarking review that will take place later in
Select (e.g. Independent Project Analysis (IPA) Pace Setter Review). Inviting IPA to
prepare for the Pace Setter Review and using BPs in-house STEP tool (from midSelect) to self assess end-Select readiness is recommended.
Establishing concept selection criteria
Selection criteria will be developed and agreed by the team at the start of Select.
These are used to differentiate between shortlisted options carried forward from
Appraise. Selection criteria should be aligned to the key business drivers.
Classic economic measures such as net present value and return on investment are
primary considerations in developing selection criteria. GIAAP provides guidance on
the boundary constraints for criteria.
Factors to consider when developing selection criteria include:

Acceptable levels of HSSE performance.

Inherently safer design criteria for the concepts.

Enabling an existing programme / standardization framework to remain viable.

Aligning with overall strategic drivers.

Aligning with access to and extraction of value from product / export markets.

Flexibility to subsurface uncertainty.

Capturing upside resource potential / protect against downside.

Enabling tie-in of future resources.

Maximizing reservoir depletion with appropriate surveillance needs.

Reliance on areas of enhanced technical or commercial risk.

Reliance on technology development.

Access to local markets and creation of local content opportunities.

Opportunities to manage / phase capex commitments.

Opportunities for a sequenced development approach.

Minimizing the extent of Brownfield modifications.

Underpinning external stakeholder alignment with partners and governments.


Choices through Select will address strategic issues such as concept type and
development schemes, while others will be more tactical. Select stage choices must
also consider alternative scenarios as part of the concept selection process.

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It is essential the select team seek input across all disciplines to inform selection
criteria.
Figure 4.3 describes the process for ensuring the design case for safety in BP
projects. The design case for safety must be considered as early as possible in Select
and is used as the basis for the operations case for safety. Further details can be
found in the Engineering and Quality Management Guideline.

OMS
OPERATIONAL SAFETY
Inherently
Safer
Design

Procedural safety
Maintain design intent (MOC)
Operations & Maintenance plan

Capex/Opex
trade-offs &
Operational
feedback

an

Design case for safety

eg

is t

O
ca pe
s r
d e f atio
Ha o n
za r s s
rd a
s fe
R t

DESIGN SAFETY

er

Safety Critical
Design Measures

GROUP STANDARDS (IM, GMOS), ETPs


APPRAISE SELECT DEFINE

EXECUTE

OPERATE

DECOMMISSION

figure 4.3 design safety


Option evaluation methodology (technical and commercial)
Integrated development planning is required to define each option further before
applying the selection criteria. This must involve all key disciplines. It is crucial the
AGM ensures integration underpins each activity carried out as part of the Select work
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plan. Experience shows dedicated and regular integration meetings are necessary to
create the right environment and behaviours to deliver this.
Work carried out in this period will fall into three categories:
1. Technical definition and integration. This is the effort within individual disciplines
and across disciplines to deliver:

Cross discipline consistency.

Cross discipline trade-offs relatively minor changes in an area may unlock


some significant movement elsewhere resulting in overall value addition.

Holistic risk and uncertainty analyses.

Consistent technical feasibility assessment and technology selection.


2. Commercial definition, to deliver:

Continued stakeholder engagement and alignment.

The framework for development planning evaluations including focus on


tax, regulatory requirements, markets, legal, tax, finance, negotiations.

The appropriate modeling basis and expectations for economic outputs.


3. Development planning work that integrates outputs from above, to deliver:

Overall concept choices by testing against previously defined selection


criteria.

Concept level articulation of risk and uncertainty.

Assessment of options fit to the life of asset Depletion Plan.

A Depletion Plan that addresses the residual uncertainties carried into


Select.
Benchmarked and standardized input data should be used for key parameters, such
as resources, cost work breakdown structures and economic methodology. This will
minimize the probability of any surprises once the concept selection is made and the
selection is matured towards Define. Adequate benchmarking of key parameters is
essential early in Select.
Additional resources will be necessary at this stage to support these activities. The
section on contractor engagement and selection addresses the role of the Pre-Front
End Engineering Design (Pre-FEED) contractors in this context.
Risk and uncertainty understanding and management
The importance of good risk and uncertainty understanding and management is
equally valid during Select, as during Appraise.
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Opportunities for major data acquisition during Select are more limited than in
Appraise. Consequently, the focus in Select is more on management and mitigation
of key risks and uncertainties. Additional data can be acquired but must be carefully
planned. Data collection in Select should target two areas:
1. Concept selection.
2. Concept definition.
The AGM must ensure risk and uncertainty management and mitigation plans are
updated to inform option maturation and concept selection. The Project General
Manager (PGM) owns the residual risk and uncertainty for the chosen concept. The
PGM is identified by mid-Select.
The AGM and the select team will, based on the options shortlist, review and update
the risk and uncertainty profile and put in place plans to:

Mitigate key risks and uncertainties that influence concept selection or overall
viability.

Manage those risks where mitigation is not possible.

Re-test the selection criteria.

Reduce risk and uncertainty to a level consistent within the current business
context, ready for handover to the incoming PGM.
The incoming PGM, and the define team will own and manage residual risks and
uncertainties following handover and transition into Define.
Through Select it is necessary to consider:

How the remaining uncertainties will be managed.

The surveillance plan, including life of field data to differentiate between upside
and downside outcomes.

What interventions can be made to mitigate the downside and to capture upside.

What remaining risks and uncertainties are carried into Define and Execute.
Can any of these be designed out? What are the mitigation plans for the
remaining risk? How can the opportunities be exploited?
It is important to establish an integrated risk management process for Select (and
Appraise) that enables visibility of risk items at aggregated and individual discipline
levels and provides context for resulting mitigation plans. This process will ensure
selection decisions can reflect the impact of the prevailing business.
See the Reservoir Uncertainty Statement & Management Guideline for further
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information. All activities here need be in compliance with the Risk Management
Guidelines for Major Projects and the Engineering & Quality Management
Guideline.
Data acquisition programme
Availability of the right data (type, quality and level of detail) is fundamental to the
selection process. The primary data acquisition objectives are to gather information,
of the right quality and at the right time, to enable the select team to:

Make the necessary concept choices that will underpin creation of the Define
FM and progression of the project into Define. The VOI analysis should inform
this thinking.

Prepare for longer term activities in the Define stage. Gathering soils data to
underpin FEED is a classic example of this.

Provide a plan for life of field data requirements.


In Select further data and information is required. This includes:

Data gathered physically from the location of the opportunity or from the
market. This includes:

Geohazards surveys.

Development quality seismic acquisition.

Market prices for oil and gas products.

Specifications of alternative export routes.

Accessing cost norms from analogue projects.

Existing facilities to which Brownfield modifications are proposed.

Information gathered from analysis of the acquired data. This includes:

Reservoir models.

Facilities and wells definitions.

Cost estimates.
Data and information must be integrated with those acquired in Appraise.
Information that underpins the concept selection process includes:

Reservoir models, linked where appropriate, to reflect overall system


dynamics (network models are recommended for complex subsea tie-back
arrangements, Top Down Reservoir Modelling is a further powerful tool but
must be used in an informed way).

Preliminary Depletion Plan.

Wells summary highlighting numbers and types.

Engineering definition sufficient to reconfirm technical viability and to underpin


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a preliminary cost estimate.


Economic outputs for and commercial analysis of each option.
Articulation of concept trade-offs, e.g. standalone versus tie-back, wet versus
dry trees.
Integrated analysis of above to determine, in the context of the predefined
selection criteria, the basis for concept selection.

Experience and judgement is required to combine the right data elements to inform
the concept selection process. Peer assists are recommended to support this
process.
Knowledge management
Knowledge management initiated early in Appraise must receive continued focus
through Select to ensure documentation of, for example:

Select options.

Selection criteria.

Contracting strategy.
In addition, in Select it is crucial to incorporate benchmarks from other projects to
ensure maximum knowledge transfer and efficiency.
For the practitioner, in Select, learning and knowledge management requires:

Capturing and applying relevant learning from other similar projects, including
those outside BP.

Transferring learnings to other appraisal teams and the Projects library.

Document control and the data management plan to support current and future
decision making.
The AGM is accountable for ensuring a knowledge management plan exists and
is implemented. A knowledge management champion should be designated to coordinate this.
See section 6.2 for further information. The MPcp Knowledge Management Guideline
also contains further information.
Contractor engagement and selection
Work across the respective technical and commercial disciplines underpins the
selection decision. Generally this is completed in-house (e.g. Subsurface & Wells) but
the facilities teams are likely to require support from external contractors / consultants.
This external activity is commonly referred to as Pre-FEED. Further definition beyond
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concept selection will be required to support the Define FM. Integrating the output
of Pre-FEED work with the other disciplines is vital.
Pre-FEED enables better understanding of the conceptual design issues. It reconfirms
technical viability and generates cost and schedule estimates, based on more detailed
work than was appropriate in Appraise. These support the selection decision.
The Pre-FEED scope of work includes evaluation of opportunities for standardization.
Outputs need to be aligned with the sector strategy approach during the latter part
of Select.
It is expected that the Pre-FEED contractor will provide support throughout the entire
Select stage, not just to concept selection, and provision for this should be made in
early contractor engagement discussions. There must be BP control, ownership and
performance management of Pre-FEED contractor work.
Several contractors have Pre-FEED experience. The AGM should ensure use of global
agreements to underpin delivery of Engineering and Project Management Services
unless there is a compelling reason against this. It is necessary to ensure that
prospective contractor(s) have the right skills to support Select activities. Right skills
centre on ability to:

Work at a level appropriate to Select, i.e. less detailed than Define and Execute.

Engage with other technical disciplines, as integration is key to Select stage success.

Consider, with BP guidance, how to reflect uncertainty in key deliverables.


Additional information is provided in the MPcp Procurement and Supply Chain
Management Guideline.
Concept selection
Concept selection is a key Select Programme deliverable that is matured during
Define Preparation. Other majors use the concept selection term to describe the
position reached at the end of the Select stage when any outstanding technical or
commercial issues have been resolved. It is important to be aware of this difference
in definition when engaging external stakeholders.
Concept selection is:

The output from integrated technical and commercial evaluations (gathered


from in-house and contracted work) tested against the agreed selection criteria.

A key opportunity to retest strategic fit with stakeholders to provide alignment


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assurance for the remainder of the Select stage. Peer assist of inputs and
outputs should be considered at this time.
Once data analysis is complete, a concept selection recommendation can be made
for internal and external endorsement. Supporting work and analysis must be fully
documented to support stakeholder engagement and to provide data reference for
future work through the rest of Select. The options not selected must be adequately
documented, for future reference during Define Preparation.
Commercial themes and outcomes
In the Select phase the focus of commercial activity is on:
Market and competitor analysis
Updating our knowledge to develop a commercial framework which can become a
robust foundation for the detailed contract structure, for example:

Supply alternatives, demand and product price differentials for oil, gas, Natural
Gas Liquids.

Confirmation of commercial frameworks and contract structures for a range of concepts.

Understand the national commercial and petroleum laws applicable to the


formation of new joint ventures or companies and any national factors affecting
petroleum operations, including production quotas, strategic reserves or
energy policy.

Identification of value chain drivers and likely acceptable outcomes for partners
and other stakeholders.

Understand options to exercise control by BP and other stakeholders.


External engagement, negotiations and agreements
This is a deeper engagement with key external stakeholders to seek alignment on
concept selection, schedule and implementation plans for the project. Preliminary
negotiations will start in the Select stage to test if there is likely to be a mutually
satisfactory deal framework which addresses key commercial terms (e.g.
hydrocarbon supply contracts, government and contractor agreements). The Select
work programme should address:

Joint venture alignment with the operators proposals.

Availability of external finance, where required, to implement Define and the


project Execute stage.

Approval of the Plan of Development by government and relevant authorities if


required at this stage.

Satisfactory negotiation with infrastructure providers or gas buyers compatible


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with the selected concept, schedule and Authorities to Negotiate (ATN).


Identification of the consequences and mitigations of schedule slippage.
Development of an exit strategy as an alternative.
Negotiation and agreement of key terms and pricing for gas product sales
within applicable ATN.

Economic analysis

Conduct economic evaluation to assist the ranking of alternative concepts and


the selection of the preferred concept, with upsides and downside sensitivities
in line with GIAAP and Economics Evaluation Methodology.

The economic evaluation model should be assured externally to the SPU for
Major Projects.

Finance and Finance Control & Accounting should be involved when evaluating
currency effects.

Lead preparation of the Define FM to ensure the business case is properly


portrayed.
4.2 Define preparation
By the end of Select, a single concept will have been chosen to take into Define. The
objective in Define is to improve the technical definition and project execution plan to
give confidence in the conceptual design, cost estimate and schedule.
Following completion of the Select Programme and to make informed decisions it is
necessary to:

Mature (technically and commercially) and enhance the quality of the selected
concept in readiness for the transition to Define the AGM will remain
accountable for this up to and including receipt of approval for the Define FM
and successful passage through the Select / Define stage gate.

Create work and organization plans for Define - the PGM will take
accountability for this with support from the AGM.
The PGM will have been identified by mid-Select, and will have been engaged in
concept selection. The PGM will work with the AGM to complete the Select stage,
including concept definition, setting targets and preparing the Define FM. Project
accountability will pass from the AGM to the PGM at the end of Select via an MOC
process.

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The PGM will own:

The Define FM.

Setting Define / Execute targets.

Building the define / execute team.

The Define work plan.

Contracting strategy.

Project execution planning.

Concept residual risk and uncertainty management.

Project direction and objectives.


Appropriate resources will move from the Select team to the Define team at the
end of Select to ensure continuity. Some key Define/Execute team members will be
appointed during late Select to support delivery of all end-Select activities, including
Define preparation.
Concept definition
Concept definition activity is characterized by two elements:
Maturing and optimizing the selected concept
This focuses on enhancing the technical and commercial definition across all
disciplines and maintaining a strong focus on integration, with continuing reliance
on the Pre-FEED contractor. This enhanced definition enables:

An updated Depletion Plan, and where required a Plan of Development.

A fully worked (bottom up) cost estimate and schedule underpinned by the
latest estimating norms; implementation of cost and schedule risk analysis.

A full suite of project economics and associated sensitivities.

Reconfirmation that no technical barriers prevent forward progress, inclusive of


sufficient demonstration of viability of any new technology enablers.

Finalization of outstanding commercial matters, e.g. agreements, negotiations


that are relevant to the transition to Define.

Concept detail decisions.

An update to the standardization plan based on the selected concept.

Implementation of appropriate Value Improvement Practices to drive additional


value into the basis for the Define FM.

Implementation of internal assurance processes at individual discipline and at


aggregated business levels including an Engineering Review.

Preparation of a Decision Support Package and Define FM.

Engagement of external stakeholders such as Partners and Concessionaires/


Host Governments.
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Implementation of an external benchmarking review, e.g. IPA Pacesetter


review.
Technology implementation plan.

Building the Define work programme


Activities to build the Define work programme include:

Key documents to be used as the development transitions into Define, e.g.


Depletion Plan, Statement of Requirements (SOR), Basis of Design, Project
Execution Plan, Contracting Strategy.

Define stage work plans.

Define stage organizational and manpower requirements and team building.

Appointment of key Define and Execute team members.

Stakeholder management plan.

Update to the project risk and uncertainty characterization.


Statement of Requirements
The SOR is a document that clearly articulates the business and technical
requirements a Project must meet. The SOR will be initiated during Appraise,
to a sufficient level that provides a basis for the development and assessment
of concepts during Select. It is important to ensure the boundaries set are
realistic and that viable business cases can be demonstrated for the Project.
From this base document the Project will progressively prepare the Integrated
Project SOR through Select. At the end of Select the Integrated Project SOR is
complete, frozen and rigorous MOC is applied thereafter. At the Appraise stage,
the SOR should typically describe the location and boundary conditions, the
HSSE criteria, the source of value, subsurface characteristics and deliverability
(as appropriate) and the overall performance requirements for the main
components of the Project such as, wells, flow lines and production/export
facilities.
During Select, the SOR will be updated with more detail as the level of
understanding and definition improves and as concepts/options are reduced.
The SOR will ultimately reflect the chosen concept and will be a fully integrated
document encompassing the reservoir Depletion Plan, facility design
throughputs, estimated operating efficiency, export stream specifications,
pipeline flow assurance and installation, commissioning, operating and
maintenance requirements. It is important in both the SOR and Basis of
Design that the range of hydrocarbon fluid compositions which the design is
to be based upon is clearly specified.
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Primary stage gate deliverables outlined in MPcp as shown in figure 4.4. Examples of
typical detailed delivery lists are included in the Engineering and Quality Management
Guideline.

Key Deliverable

End Appraise

End Select

Appraisal Plan

Updated

N/A

Wells Basis of
Design (BoD)

Preliminary
Prepared

Finalized

Scenario Planning

The business case for the


development scenarios is
supported by appropriate
schedules and cost
estimates.

Project Statement of
Requirements (SoR)

Outline Prepared

Complete

Life of Field Plan of


Development (PoD)

1. Scoping plan prepared for


each option.

1. Available for the Reference


Case

2. Outline plan available for


the Reference Case

2. Available for each option


which tests robustness to
upside and downside
outcomes

Surveillance Plan

Outline Prepared

Plans described in Depletion


Plan

Technology Plan

In Place

Updated

Front End Loading (FEL)

Current/Predicted FEL
Assessments complete

Engineering Basis
of Design (BoD)

Available for selected


concept

Project Execution
Plan

In place and outline communicated to team members

Operations and
Maintenance Strategy

Draft Developed

Commissioning
& Start-up Plans

Updated for selected concept


Outlined sufficiently to identify
issues relevant to Define

Relationship
management plan

Preliminary plan prepared

Being implemented

Interface Management
Plan

Outline Plan Drafted

Draft Plan Prepared

Organization Strategy

Drafted sufficient to identify


major issues, limitations and
opportunities.

Developed through to and


including handover to
Operations

Knowledge
Management Plan

Established

Updated

figure 4.4 key deliverables and expectations at the end of Appraise



and Select
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A
M pp
an ra
ag isa
e l
Pr r Ge
ne
M oj
an ec
ra
l
ag t R
Pr er eso
M oj
ur
an ec
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ag t D
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W r eve
M el
lo
an ls
pm
ag Pr
en
og
e
t
r ra
C
M om
m
an m
m
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ag er
O er cial
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an ra
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H
SS r D
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E
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M
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ge
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ne
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en

4 select work focus and activities

Select stage
Value Improving
Practices

Project Dev.
Manager

Environmental
Performance
Requirement (EPR)
Compliance Report

Operations Dev.
Manager

Plan of
Development

Project Dev.
Manager

Wells Basis of
Design

Wells Project
Manager

Facilities Basis of
Design

Project Dev.
Manager

Front End Loading


Assessments

Appraisal General
Manager

Quality Plan

Project Dev.
Manager

Commissioning
and Start-up Plans

Operations Dev.
Manager

Management of
Change (MoC)
procedure

Appraisal General
Manager

10

Authorities to
Negociate (ATNs)

Appraisal General
Manager

11

Define Finance
Memorandum
(FM)

Appraisal General
Manager / Project
General Manager

R = responsible; A = accountable; C = consulted; I = informed


figure 4.5 RACI chart of the key Select stage MPcp documents and deliverables
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A RACI chart describing which of the key leadership roles in the Appraisal team
owns each deliverable is in figure 4.5.
Select-Define Gate
Assurance
Internal assurance processes will require considerable focus at this point.The following
discipline reviews must be undertaken prior to the Define FM HoD Review:

Subsurface & Wells.

Drilling & Completions.

Engineering.

Procurement and Supply Chain Management.

Commercial.

Cost and schedule.

Project HSSE Review (PHSSER).

Benchmarking and Front End Loading assessments, including an IPA Pace


Setter Review.

Reserve and resource compliance.


The IPA Pace Setter Review is required prior to the HoD review.
It is essential these reviews are appropriately planned and resourced to ensure they
are timely and effective. Any flexibility required as a result of remaining uncertainty
will need careful consideration at this point.
HoD reviews will assess and summarize readiness to progress to Define and provide
the basis for TVP attestation.
External stakeholder engagement
External stakeholders may have different processes at the end of Select. Some will
be happy to proceed into FEED on the basis that their only commitment is for Define
expenditure; others see this as a major sanction decision. It is crucial that the outputs,
recommendations and forward plans are suitably networked with stakeholders to
ensure they are supported at the end-Select stage gate. The AGM and PGM must
deal with any misalignment which is judged to be a potential risk to the projects
success.
Detailed commercial terms must be established by end-Select. As a minimum, binding
contractual frameworks, within which fully termed agreements are capable of being
executed are required. There may be outstanding conditions to be satisfied (such as
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government and regulatory approvals) which can be addressed during the Define and
Execute stages. Detailed plans to deliver these are required by end-Select.
Key to a successful project is the need to ensure the commercial and contractual
aspects of the entire deal (from concession access, joint venture terms to product
sale terms across the value chain) can progress without the project being stalled by
an incomplete contract or a partner yet to commit to the terms.
Define FM
The Define FM is the final deliverable from the Select stage and is the basis for
achieving internal approval to progress into Define. It is a relatively short document
that conveys sufficient information to enable strategic and project perspectives to be
taken by key decision makers.
The Define FM will be prepared in line with GIAAP and the Group Economics
Evaluation Methodology available on BP group websites. The Group Delegation
of Authority website should be used to establish who has the financial authority
to approve the resource request. Templates of the correct Define FM format and
contents are available on GIAAP websites and MPcp.
When entering Define, management or a joint venture may set targets for the
project. This may be to achieve a performance target capex or to meet the financial
frame of the SPU. The Define FM will also have a boundary condition based on Not
to Exceed capex to enable the project to be executed at a lower level of delegated
authority, e.g. Segment CEO rather than Resource Commitment Meeting. An open
conversation, transparently informed by all appropriate data should occur with key
stakeholders in setting targets (including Segment Executive Team).
Capex targets should be underpinned by Project Services estimating procedures
(see the Project Services Guideline) and should describe the performance target and
Not to Exceed capex values. This area is typically also considered at a HoD review.
The schedule in the Define FM must adequately consider the drivers of natural pace
and must be transparent in describing how residual risk will be managed.
Investment quality and any financial targets should be realistic and be supported by
an understanding of the uncertainty ranges for resources, costs, schedule and the
attendant risks.

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Decision Support Package


The Decision Support Package will confirm:

The recommended concept is viable, robust and compelling and the processes
used to derive it.

Risk and uncertainties have been characterized, and mitigations and processes
address residual risk and uncertainty.

There are no outstanding issues (including those of stakeholders) that would


preclude entering Define.

There are forward plans with appropriate targets set for the define / execute
team.
The Decision Support Package will also articulate the estimated development costs
and schedule and the associated economic parameters along with some clearly
defined sensitivities.
The toolkit in section 6 provides links to Decision Support Package and Define FM
templates.

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A clear and consistent organization strategy underpins creating distinctive projects.


Understanding, setting and developing organizations are key to project success and
are essential habits of great appraisal leaders. Integrated multi-discipline teams are
fundamental to creating distinctive projects.
This section sets out the principles, organizational design biases, BP staffing
expectations and the processes to be adopted by the AGM in developing an effective
organization strategy and plans which enable detailed organization charts and staff
mobilization plans to be created. It has been developed in support of the expectations
set out in the organizational capability element of MPcp.
There is an expectation that there will always be a BP appraisal leadership team
led by an AGM accountable for overall delivery. The AGM develops the organization
strategy on three levels:
1. Primary role of the BP appraisal leadership team related to the company goals
and expectations.
2. Key accountabilities of the BP appraisal leadership team and individuals.
3. Detailed roles and responsibilities of individuals.
Before setting the organization strategy, the AGM must first have a clear understanding of:

The project business context, as defined by business framing in section 3.2.

The roles and key accountabilities for the BP appraisal team, which cannot be
delegated to others within the project. These are described in sections 5.2 and 5.6.
The AGM must bring these complementary elements together and adhere to the
organizational principles, as outlined in section 5.3, to form the organization strategy
as described in section 5.4. The organization strategy is developed in early Appraise
by the AGM and tested in the Appraisal Plan HoD review.
When the organization strategy has been confirmed, organization charts are
developed detailing key positions to be appointed. These feed into staff mobilization
and succession plans, and ensure adequate resources are available for Appraise and
Select. The organization will need revisiting at end-Appraise to enable the appropriate
evolution of staff numbers and skill areas.
The PGM will develop a resource plan to ramp up the define / execute teams. This is
done in accordance with the MPcp Organizational Design Guideline. During Select, the
Define / Execute organization is further detailed by the PGM after their identification in
mid-Select. Providing data to the Resourcing for Success process is important at this
stage to enable functional planning for deployment of scarce staff resources.
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5.1 Business context


When setting the organization, the AGM must have a detailed understanding of the
context in which the opportunity will be evaluated and the project will be created. The
primary elements which describe the context are:

Stakeholder alignment.

Subsurface complexity and appraisal uncertainty.

Environmental considerations.

Concept elements or building blocks that could make up the project, e.g.
onshore, offshore, subsea.

Development of a programme of projects or development of a single project.

Geographical, such as multiple locations.

Political factors, such as multiple government or country expectations.

Business objectives and priorities including project pace and schedule.

Local factors, such as the requirement for national staff development, schools
and rotas, housing, medical, staffing policies and visa restrictions.

The range of Brownfield activities for the project or other SPU project activities.

Technology requirements.
5.2 Key accountabilities
The BP appraisal leadership team accountabilities are illustrated in figure 5.1. These
must not be delegated.

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Leadership

Set context
and direction,
Set strategies
and intervene

Provide
assurance,
Performance
manage project
disciplines

Technical definition

Technical
integrity/HSSE,
Enhanced
reputation,
Distinctive value

Performance
management

Define scope
and standards,
Manage
technology
development

Integrate across
functions,
Manage interfaces

Interface
management

figure 5.1 role of BP in Major Projects


Leadership
Leaders will adopt the habits of great appraisal leaders (see section 1). The AGM is
accountable for leading the team and managing the project, and must:

Enforce the standards for HSSE and technical integrity, and ensure standards
are not prejudiced by schedule and cost pressures.

Work across disciplines to integrate activities.

Work in an environment where uncertainty is both prevalent and acknowledged


as a primary characteristic of data used in evaluations.

Provide strategic context and focus for technical and commercial activities.

Be adaptive, flexible and responsive to changing circumstances.

Effectively transition the opportunity to subsequent, more detailed stages.

Establish clear priorities.

Establish the overall scope of the project as required by the business


objectives, project concept, applicable laws, regulations and BP company
standards.

Set clear lines of delegated authority and accountability from the project single
point of accountability to individual team members.
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Manage the requirements and expectations of internal and external


stakeholders including host governments, partners, third parties and Non
Governmental Organizations (NGOs) as agreed with the SPU.
Set the overall implementation plan for the project.
Provide development opportunities for team members.

Technical definition
The appraisal leadership team must:

Control the overall scope through application of the project codes and
standards, SOR and engineering and wells.

Deliver a preliminary Basis of Design managing scope, the integration


between the project elements, disciplines and overseeing technical interfaces.

Control and own the Depletion Plan.

Meet resources reporting requirements.


All projects must have access to an Engineering Authority (EA), either an SPU EA
or MP EA, to ensure the choices made are consistent with BP standards. See the
Engineering and Quality Management Guideline for more detail.
Integration management
The appraisal leadership team will actively manage all project interfaces and must:

Ensure compatibility and interface management across interfaces (consistent


with the interface management plan).

Ensure integration of the BP disciplines Subsurface & Wells, Drilling &


Completions, Operations, Projects & Engineering and Commercial to capture
maximum value at all times.

Be accountable for the handover of the project to the PGM.


Performance management
The appraisal leadership team provides rigorous performance management to identify
and intervene when early warning signs of problems occur, and must:

Ensure Appraisal objectives are met through monitoring Key Performance


Indicators (KPIs).

Deliver a level of assurance and control dependent on the project and


component risks.

Undertake regular reviews and audits of contractor activities.

Operate a rigorous risk (threats and opportunities) management process.

Deliver Appraisal activities within approved budgets.


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5.3 Organization development


Figure 5.2 shows the generic organization design for projects in Appraise and Select.
The key appraisal leadership team positions are shown. These positions must be
filled as early as possible in Appraise. Not all positions will report as shown to the
AGM, e.g. the Commercial Manager and Operations Manager may have a dotted line
reporting relationship in SPU organizations with centralized commercial / operations
teams.
Appraise / Select

Define / Execute

Appraisal
General Manager
(AGM)

Project
General Manager
(PGM)

SS&W

P&E

D&C

Commercial

Operations

HSSE

Project
Resource
Manager
(PRM)

Project
Development
Manager
(PDM)

Wells
Program
Manager
(WPM)

Commercial
Manager
(CM)

Operations
Development
Manager
(ODM)

HSSE
Manager
(HSSEM)

Reservoir
Management
Base
Management
New Well
Delivery

Concept
Selection
Facilities
Engineering
Definition
Projects
services
PSCM

Completion
Engineering
Well
Construction
Drilling
Engineering

Economics
Agreements
Non technical
functions
Markets

O&M
Strategy
Readiness

Safety
Operations
integrity
Security
Environment

High Level Work Fronts


PGM - Identified by mid-Select
- Accountable for project team and delivery from end-Select
- Key Appraisal team staff will transition to Define / Execute organization at end-Select

figure 5.2 appraisal (Appraise and Select) organization design


The AGM is accountable for building and leading the Appraise / Select organization.
The PGM is accountable for building the Define / Execute organization from midSelect and transitions from the AGM into the leadership role at end-Select.
Examples of recent Appraise and Select organizations and a description of the
factors to be taken into account depending on the type of project Greenfield,
Brownfield, non-BP Operated and Host & Satellites - are provided in section 5.7.
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Leadership

The project accountability is delegated by the Gatekeeper (usually the


SPUL, but in some cases the BUL or PUL) to the project Single Point of
Accountability, who is named in the Appraisal Plan, who is usually the AGM
in Appraise and Select. This accountability transitions to a PGM at end-Select.
The Single Point of Accountability is the first position in the organization where
accountability exists for all aspects of project creation.

The project Single Point of Accountability should split accountability such that
each individual has a manageable workload with an understanding of the risk,
geographical diversity, scale, scope and complexity.

Where project scope and scale allows, the project Single Point of
Accountability should be the AGM with accountability for all project activities,
including Subsurface & Wells, Drilling & Completions, Projects & Engineering,
Operations and Commercial, maximizing integration between the BP
disciplines. See figure 5.2.

The roles of each team within the BP appraisal leadership team should be
clearly defined by the AGM in Appraise.

The AGM sets the overall strategy and organization of their direct reports.
The leadership team should define their own organizations, and agree on the
size and shape of their team with the AGM. This allows the managers to take
ownership of their teams.

The organization should be sized to allow development and succession planning.


AGMs can come from any of the core technical disciplines (Projects & Engineering,
Subsurface & Wells, Drilling & Completions, Operations and HSSE), including
Commercial (provided they have a technical background), and have integration skills
and habits of great appraisal leaders.
A specific integrator role should be considered to ensure effective cross discipline
integration.
In Appraisal, the Project Development Manager (PDM) acts as the Engineering
Manager and EA.
Technical Definition
The PDM and the engineering team are central to the creation of long-term value and
technical integrity.

The PDM should report directly to the AGM. The PDM will also have a reporting
relationship to the SPU EA.

The PDM (supported by the technical authorities, the SPU EA, advisers, senior
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advisers, chief engineers, and HoD Engineering as necessary) has Single Point
of Accountability for technical quality and the resolution of engineering issues.
Development engineers will be appointed within the BP engineering teams.
They will cover process, structural and subsea positions as a minimum
requirement, as well as other positions as required by the complexity and scale
of the opportunity.
Where the AGM has a subsurface background the PDM will be their second in
charge.

The Project Resource Manager (PRM) and the subsurface team are central to
the characterization of the resource and the overall understanding of value of the
project.

The PRM will report directly to the AGM.

The PRM is the Single Point of Accountability for resource issues and technical
quality of the work.

The PRM will also hold the relationship with the SPU Reserves Authority
including resources assurance via the reserves Compliance Managers.

The PRM will be second in charge to the AGM, if the AGM has a nonsubsurface background.
The Wells Programme Manager (WPM) and the wells team are central to well planning,
design, cost estimation, wells programme execution and the overall understanding
of value of the project.

The WPM will report directly to the AGM.

The WPM is the Single Point of Accountability for wells issues and technical
quality of the work.
The Operations Development Manager is central to operations best practices being
considered in engineering design. They will work with the operations team in existing
assets to ensure Brownfield projects are fully informed by asset learning and are fully
integrated with host facility and infrastructure plans.
The HSSE Manager will support this process and ensure inherently safe design,
operations integrity, security and environment areas are fully addressed.
The AGM and their second in charge should be from different disciplines. Of the
other disciplines, the Commercial Manager offers a further powerful integration
perspective.

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Integration Management
The appraisal leadership team will directly manage:

Driving integration across the team.

Cross-functional interfaces between all disciplines.

Transition between the appraisal leadership team and the project management
team.
A member of the appraisal leadership team will be delegated responsibility to ensure
integration is effectively managed.
Continuity of staffing between Appraise/Select and Define will be considered to
ensure knowledge of the underlying rationale for the creation of the project is carried
forward into the project management team.
Performance management processes
The AGM will establish systems to aggregate project performance information and
analysis to ensure the appraisal leadership team has a holistic view of the project
status. Suitable KPIs must be established as early as possible in Select. This will
ensure intervention as required to performance manage delivery.
5.4 Setting the organization strategy
An organization strategy is a required deliverable for the Appraisal Plan review and
should:

Clearly describe the role to be undertaken by the appraisal leadership team.

Define how the project scope will be delegated from the project Single Point of
Accountability to individuals and teams providing a clear rationale for the work
breakdown structure and demonstrating alignment with the opportunity.

Be supported by organization structure and charts, and a resource Staffing Plan.

Provide clear job descriptions so people understand their role and


accountabilities.

Provide clarity on the use of agency personnel and secondees from contractors
or partners.

Define how Projects & Engineering, Drilling & Completions, Subsurface & Wells,
Commercial and Operations will be integrated into the project organization.

Include a Staff Mobilization Plan.

Use a RACI chart to help understand delivery ownership in complex SPU


organization settings.
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5.5 Staffing expectations


Key positions
Key project positions, including all leadership positions (figure 5.2), must be filled by
competent BP staff, to:

Ensure business value is optimized.

Ensure BP policies and values are upheld and implemented.

Identify and manage key business, safety and integrity risks within the project.

Provide detailed and specific skills which are not readily available in the agency
or contractor market.
The balance of BP, agency and partner secondees on a specific project will be
influenced by the availability of experienced people, the agency market, strength
of contractors, partner needs and political requirements. Opportunities to second
experienced staff into joint ventures should be considered to make a distinctive
contribution for mutual advantage.
BP staff will be employed in other positions to provide staff development, discipline
capability for the future, training and for the retention of knowledge within the
company.
The high level principles used to determine the BP badged positions are in figure 5.3.

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BP in-house

BP development

Agency / Partner

Key part of role is to instill


strategic BP values,
through leadership,
Code of Conduct,
GHSER and brand
Reputational expectation
Legal duty holder
Engineering or Technical
Authority
BP specific knowledge
Strategic leverage
No local expertise
Frequently required,
highly skilled role

Role provides succession


for more senior BP badged
role
Role is a key early
development and training
slot specifically for
challenge and early
development

Not frequently required,


highly skilled role
Local developed market
Niche service
Market is mature role
exists in the contractor
scope
JV and partnership
dictates third party
employee
Local legislation dictates
third party employee

figure 5.3 badging strategy table


The alternative of using partner or agency staff for positions recommended for BP
staff should be carefully considered both in terms of the business need and on the
basis of advice from HoD Projects and HoD Engineering.
The number of positions from figure 5.3 which are required for a project should be
defined within the organization strategy and will be a function of the scope, scale and
complexity of the project.
Team staffing and succession planning
A succession review should be undertaken each year as part of the segment wide
organizational capability assessment and to identify development needs for individuals.
These processes are managed by the Directors of Organization Capability through
the Staff Development and Deployment Network (SDDN) process. Subsurface &
Wells, Drilling & Completions, Operations and Commercial Directors of Organization
Capability and SDDNs will need to be consulted as well as Projects & Engineering.
The AGM should maintain a project succession plan for key positions in their own
project and for staff development. The plan should ensure the project can be staffed
adequately even if key people leave. It should recognize the role of the project in
developing junior staff for more senior positions across the segment, and address
generic roles as well as the specific needs of the project.
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5.6 Roles and accountabilities


The following are the key roles in the appraisal organization. Other roles in the appraisal
team are described in the individual discipline SDDNs / Competencies Online.
Appraisal General Manager
Overall role
Leads and integrates the overall project as the Single Point of Accountability in
Appraise and Select stages.
Key accountabilities

Act as the Single Point of Accountability delegated by the gatekeeper (SPUL)


for Major Projects as a Major Project Leader in Appraise and Select. Ensure all
MPcp expectations in Appraise and Select are met.

Demonstrate visible HSSE leadership by example and deliver the Appraise and
Select programmes consistent with BPs Safety & Operations Integrity agenda.

Build and lead an integrated multi-discipline team of Subsurface & Wells,


Projects & Engineering, Drilling & Completions, Commercial and Operations
staff. Plan for success.

Ensure strategic fit and business context and drivers are understood and
communicated at the beginning of Appraise.

Prepare an Appraisal Plan and lead the team through HoD and TVP reviews to
achieve attestation and approval of this key governance document.

Lead the team to characterize Appraise opportunities in terms of uncertainty


understanding, risk, natural pace and value.

Lead the team to generate and evaluate the options informed by the most
appropriate data, considering all sources of value, and taking into account
trade-offs.

Inform decisions involving quality through choice and a full value chain
assessment of investment quality versus risk to determine if a technical and
commercial viability option exists at end-Appraise.

Lead the Select programme to establish selection criteria, gather the data
to evaluate and select the concept option and prepare sufficiently for Define
entry, including the Define FM.

Ensure the chosen concept is tested for strategic fit, technical viability and
technology risk and has a commercially robust business case; all via open and
transparent conversations with SPU and Segment leadership.

Ensure effective transition of the chosen concept and the team to the PGM by
end-Select.
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Establish performance management systems and KPIs for the project


(including schedule milestones).
Develop and implement a Knowledge Management Plan.

Competencies, skills and knowledge

An appropriate technical degree.

Experienced leader with business acumen.

Is a graduate of the Projects Academy, or is booked to attend.

Deep experience in MPcp and project management.

Experienced in leading teams in Appraise and Select and also Define and Execute.

Able to deal with complex or ambiguous data.

Able to integrate effectively across data and discipline boundaries.

Able to build and maintain both strong internal and external relationships.

Capable of making difficult decisions.


Project Development Manager
Overall role
To lead the appraise / select team a mix of discipline engineers, project services
and PSCM staff.
Key accountabilities

Manage a diverse group of discipline engineers, project services and PSCM


staff, provide leadership, strategic context, coaching, development and
objectives / appraisals; define team resource and deployment requirements.

Represent team members at SPU People Day development discussion sessions.

Provide overall technical assurance of work delivered by the team.

Drive connectivity with the define / execute teams.

Drive facilities connectivity across all Appraise and Select activities.

Facilitate Appraise / Select input to and ownership of the facilities aspects of


the technical standard.

Participate in the appraise / select leadership teams comprising AGM and team
leaders for Subsurface & Wells, Commercial and Operations.

Facilitate formal and informal cross-discipline integration within Appraise / Select


and implementation / delivery of Development Planning activities / outputs.

Provide leadership input to Partner and Concessionaire Technical and Project meetings.

Facilitate focus on future facilities technology development requirements.

Provide accountability for engagement of external resources, such as


Exploration & Production Technology Group (EPTG) and contractors.

Ensure inherent safety in engineering designs and delivery of Integrity


Management Standards.
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Act in the capacity of Major Projects EA from the beginning of Appraise.


Ensure project contributes to SPU strategic delivery and overall company
technical and business objectives.
Manage interfaces with BP Shipping (where applicable) and midstream
facilities (gas plants, pipelines).

Competencies, skills and knowledge

An appropriate engineering degree and relevant engineering experience and


qualifications.

A deep understanding of Appraise and Select requirements from Facilities and


Integration perspectives.

Familiarity with BPs Capital Value Process / Common Process, with particular
focus on Appraise / Select expectations.

Able to define and prioritize issues.

Good working knowledge of front end (Appraise / Select) facilities and


integration activities, and experience of Define and Execute.
Project Resource Manager
Overall role
Leads and integrates Subsurface & Wells activity to represent subsurface
understanding and forward plan at Performance Unit or project level from preAppraise through Appraise, Select to Define FM.
Key accountabilities

Creates and owns the Depletion Plan and resource progression.

Leads key Subsurface & Wells Common Processes where relevant (Exploration,
Opportunity Progression, Base Management) and ensures timely Subsurface &
Wells input to other key processes (notably MPcp, Beyond the Best).

Manages multi-disciplinary interfaces especially with Projects & Engineering,


Wells, Commercial and Operations teams.

Informs project natural pace with clear characterization of subsurface activities


and constraints.

Resourcing and managing Subsurface & Wells team within the project
organization.

Ensures long lead data and information needs are being addressed, including
geotechnical and geohazard areas.

Provides the subsurface elements of the SOR.

Compliance with Resources and Reserves Operating Standard.

Provides overall technical assurance for the work completed by the team.

Manage external contractors and HSSE performance.


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Competencies, skills and knowledge

An appropriate subsurface degree.

Strong proven Subsurface & Wells discipline experience in project environment.

Strong and respected foundation in technical discipline skills.

Attended Subsurface & Wells Team Leader Mastery.

Demonstrated leadership skills and behaviours.

Ability for dialogue with senior projects personnel.


Wells Programme Manager
Overall role
Single Point of Accountability for all Drilling & Completions activities within the
project. Ensures Drilling & Completions issues are understood and resolved in order
to support appraisal programme delivery and concept selection.
Key accountabilities

Lead the Drilling & Completions team within the project organization.

Establish and manage plans for Drilling & Completions activities.

Well Design & Construction Performance (Cost / Schedule / Quality).

HSSE on Drilling & Completions operations.

Execution of the Operations Integrity standards on Drilling & Completions


activities.

Resourcing and people basics for Wells teams.

Supporting the contracting strategy and performance management of


appropriate contractors.

Appropriate functional support to and integration with, the Projects team.

Technical input to business proposals and providing necessary cost, risk and
deliverability assessments.

Manage wells contractors.


Competencies, skills and knowledge

Strong proven Drilling & Completions discipline experience in project


environment.

Strong technical discipline skills.

Demonstrated leadership skills and behaviours.


Commercial Manager
Overall role
Responsible for financial planning, performance management, integrated business
case development and negotiation of external agreements.
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Key accountabilities

Economic modelling and analysis.

Interpreting existing business agreements.

Interface with non-technical disciplines, e.g. Legal, Tax, Finance Control &
Accounting, and Communication & External Affairs.

Production of Long Term Plan.

Group Financial Outlook analysis and reporting.

Production of all governance of Documents ATN and FM.

Quality verification of models and analysis.

Business agreements development and negotiation.

Interface with Gas Power & Renewables on term Gas Sales Agreements.

Interface with all technical functions, including PSCM and Project Services.

Non-technical assurance - Peer Reviews and MPcp events.

Communicating the project impacts of the licence and commercial agreement


terms.
Competencies, skills and knowledge

High level of competency in each of the Commercial activity areas Planning


and Performance Management, Commercial Operations and Business
Development.

Track record of multi-discipline team integration.

Experienced coach.

Strong presentation skills.


Operations Development Manager
Overall role
Provide operating input to concept development and selection. Establish project
operations and maintenance strategy.
Key accountabilities

Identify key operations risks and issues to be addressed in the Select stage.

Ensure operations issues are understood and resolved in order to support


concept selection and the Define FM.

Establish plans for operations activities in the Define stage.

Accountable as the interface for operations in existing facilities.

Deliver Commissioning and Operations Readiness MPcp expectations for


Appraise and Select stages.

Ensure the proposed concepts can meet the projects operations strategy and
identify high level risks with each option from an operations viewpoint. Bring a
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current understanding of operations strategy, excellence and respective value


to the project.
Contribute to the business case. Develop a high level opex estimate and target
for operations efficiency (detail dependent upon knowledge in area). This
should be benchmarked where possible.
Create high level location support models (e.g. what logistics, people and
engineering will be needed and respective sourcing).
Plan for recruitment and training needs at the Appraise stage, when preparing for
activity in a new country. This may also apply in an over-heated resource market.
Ensure the concept selected and the SOR meet all requirements of the
projects operations strategy.
Provide all required input in the concept selection and SOR development, to
reflect the operations strategy in the statement of requirements, Basis of
Design (to address the operational implications of the reservoir surveillance
plan, equipment location, maintenance access, specific vendor requirements
for standardization) and PEP.
Represent operations in capex / opex trade-offs to maximize whole life cycle
value opportunities.
Contribute to the interpretation of the Integrity Management standard in the
project concepts.
Create a high level plan for the operation and maintenance of the facility
including staffing, recruitment and competency assessment.
Ensure adequate time is incorporated into the project schedule for final
commissioning and proper handover to Operations.

Competencies, skills and knowledge

An appropriate technical degree.

Must have Major Projects start up experience.

Capable of articulating operations strategy intent and vision.

Understanding and communicating the key attributes of an effective


maintenance and integrity programme.

Understanding of design and ability to communicate an operational out turn


into front end recommendations.

Experience in developing the operations strategy, application of the Operations


Management System, Integrity Management standard, Common Maintenance
Strategy and operational staff planning.

Aware of available trade-offs between capex opex model (Choke Model) and
have a knowledge of available and emerging technology.

Strong influencing skills and ability to communicate operating requirements in


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business case terms.


Ability for dialogue with senior projects personnel.

HSSE Manager
Overall role
Leads and integrates HSSE activity and advises on inherently safe concept design.
Key accountabilities

Confirm that significant HSSE issues that could affect the viability of the
potential project have been identified and that the information required
to assess HSSE risks, liabilities, regulatory compliance, HSSE contractual
commitments and adverse impacts is either available or measures are in place
to obtain it.

Ensure operational risks related to appraisal activities (wells, seismic) are being
managed appropriately.

Confirm HSSE risks (including Major Accident Review) are taken into account in
the evaluation of project options.

Ensure all HSSE concerns relating to the characteristics of the full life-cycle of
the project, novel technology and the nature of the chosen location have been
identified.

Develop a Project HSSE Management Plan that defines the HSSE


expectations, organizations, and systems to manage HSSE throughout project
development and execution.

Ensure all applicable regulations, BP standards, practices, requirements and


expectations relative to HSSE are identified and delivered.

Provide support to the team in meeting MPcp expectations, requirements


of the MPcp HSSE Guidelines, and BP standards and practices (including
Environmental Requirements for New Projects).
Competencies, skills and knowledge

Experience in MPcp and developing a Project HSSE Management System.

Experience in leading people and developing HSSE organizations.

Experience from current / recent projects is applied.

Recognized as credible HSSE leader.

Ability for dialogue with senior projects personnel.

Understanding of Operating Management System.

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5.7 Organization design settings


Greenfield projects
Greenfield organizations are relatively straightforward to design and should
follow the suggested template in figure 5.2. Thought should be given to key staff
transitioning with the project from the Access / Exploration phase to provide
continuity as the project enters Appraise. Similarly planning early for future stage
gates (Appraise / Select, Select / Define) is important in Greenfield settings,
particularly where the project is, or could become, part of a programme.
Integrated multi-discipline teams are fundamental to creating distinctive projects
and each of the core disciplines must have a leader as a direct report to the AGM.
In some situations a specific integrator position can be used to drive integration
across the disciplines in support of the AGM and appraisal leadership team.
Dedicated resources are imperative for success and must also be present for all
core disciplines.
In most SPU settings at least some of the positions will be resourced by staff in
centralized or shared services teams, e.g. commercial staff. In these situations
it is important that a single, dedicated point of contact with a clear performance
contract held with the AGM or a member of the appraisal team leader is in place
from such teams and that they attend all regular appraisal team meetings.
Greenfield projects in programme settings are more complex. They need to be
designed to integrate standardized facilities delivery lines across multiple assets
in the programme. Each asset in the programme will be at different stages on the
road map (figure 1.3) and the organization design will need to account for this.
Staffing programme organizations requires a well-designed process for managing
the recycle of core staff between project stages as each programme element
matures.
Brownfield projects
Progressing a Major Project in a Brownfield environment adds another potential layer
of complexity to the organizational design. This added complexity means a wider
range of possible models can be considered. Specifically, there are more interfaces
to manage compared to the normal interfaces with a Greenfield project.
A Brownfield project tasked with working in an operating Asset typically means that
the Asset has huge ongoing responsibilities and is almost always challenged to make
time to provide the needed input for the project. The experience and knowledge of
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the Asset in all disciplines (Drilling & Completions, Subsurface & Wells, Commercial,
Operations, etc.) must be woven into the project. The organization model needs to take
into account the ability of the Asset team to meet their existing responsibilities and
the demands of a new project. Teams historically underestimate the effort and time
required to manage these interfaces and technical exchanges. Consideration should
be given to staffing the project with full-time resources in most, if not all, disciplines.
If a team separate to the Asset is deemed appropriate, then strong consideration
should be given to taking people experienced in the Asset and embedding them in
the project team.
By definition, a Brownfield project builds on the wealth of data, information,
experiences and evolving business context inherent in the existing asset. Drivers
include:

Considerable volumes of static and dynamic reservoir data, often stored in


inconsistent databases.

Multiple historic interpretations of production data leading to apparent


complexity.

Complexity in commercial and land agreements due to the heritage of


historical negotiations and deals.

Often greater visibility with, and attention from, regulatory agencies.


These drivers should be taken into account when assessing levels of resourcing in a
Brownfield team.
As with any project, the organization design will need to evolve as the project
progresses. Brownfield projects should start with the same organizational model as
a Greenfield and then work down with a quality assessment of which resources in
the existing Asset can actually be shared resources. This obviously depends upon the
scope, scale and pace of the new project and the existing activity level in the Asset.
In a large complex Brownfield project, early development planning is complicated
and may warrant a small development planning team. The development scenario is
complicated by the interfaces with the Asset (existing programme) and the amount
of information to include in the plan.
Non-BP operated projects
A significant proportion of our projects are operated by others. The principles of
MPcp and the Appraisal Guideline are applicable to these projects, but the role as
non-operating coventurer must be acknowledged in the organizational design of the
non-operated team.
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The non-BP operated teams purpose is to:

Influence the Operator to deliver the project according to BP principles and


business objectives.

Provide assurance regarding the project to allow TVP attestation as required.

Recover and disseminate learning from and to the Operator and within BP.
The principles below should be followed for the composition of such a team.
Levels of financial exposure are a driver for resource allocation, so bigger projects
should have bigger teams. Small projects will usually be the last in the chain of
developments within a given venture; a track record will have been established, so it
will be possible for a relatively small team to discharge its responsibilities by focusing
on critical elements of the project.
In non-BP operated projects, incremental risk is introduced through the competencies
and biases of the Operator. All key functions (static reservoir description, reservoir
engineering, development engineering, Drilling & Completions) would normally be
represented on a non-BP operated team for a material project. However, the relative
emphasis for staffing decisions should be informed by a preliminary gap analysis of
the Operators skills and practices versus BPs. The analysis should be performed and
reviewed as part of the Appraisal Plan, and updated as required based on the results
of subsequent technical work by the full team.
The core team will usually consist of the disciplines above. Dedicated individual team
members for specific disciplines will not always be justified - the implied requirement
for sharing of resources should, where possible, be with operated assets in order
to promote learnings transfer. Non-core disciplines, e.g. Commercial, HSSE, should
be sourced from other teams within the SPU or EPTG. The need for a dedicated
resource acting as AGM versus the role being performed by one of the core discipline
contributors should be assessed on a case-by-case basis. Since the team will probably
be relatively small but experienced, a flat organization is usually appropriate, modeled
on the standard design (see the Greenfield project section). As far as possible, there
should be clear role alignment with the Operator.
The ability to influence an Operator wanes rapidly after the Appraise and Select
stages, so it is critical to focus on this during Appraisal. Significant influencing
impacts are best made through a combination of appropriate influencing skills with
the early recognition, using highly developed integrating skills, of key strategic issues.
Inevitably, this requires a relatively senior profile for a non-BP operated team. The
non-BP operated team is the first source of assurance for HoDs and TVPs. Although
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other BP SMEs and peers are also valuable sources, the lens through which they
see the project is that of the non-BP operated team. The judgement required to
ensure focus of assurance efforts on key issues will require a relatively senior set of
technical team members.
Host & satellites projects
This section will look at two generic types of Host and Satellites organizations
through the lens of two specific BP Projects:
1. BP operated host with BP operated satellites.
2. BP operated host with non-operated satellites.
BP operated host with BP operated satellites
A good example of this is the Farragon Project, which was a very successful BP
Operated Satellite tied-back to the North Sea Andrew platform in 2005. This was
developed quickly, efficiently and safely through excellent communication and
cooperation between all disciplines involved, resulting in a record 31 months from
discovery to first oil (one month ahead of schedule), a doubling of the production
from the Andrew platform, and all achieved safely and on budget.
The keys to success for this project can be used as a model for other BP Operated
Satellites. They are:

Alignment at the Gatekeeper and Steering Group level to ensure the Asset and
Project teams worked together constructively and cooperatively.

A high level of cross discipline and cross team integration.

Working closely with the project contractors to ensure requirements are


understood.

Co-location of facilities, subsurface and drilling teams to ensure good


communication.

Strong integration between operations and project teams to tailor a successful


start-up programme.

Strong interdisciplinary integration naturally created an environment for creative


and innovative thinking a cradle for technology firsts in the North Sea.
BP operated host with non-operated satellites
The Fiddich Project in the North Sea is a proposed tie-back of a Talisman field through
the ETAP central processing facility. The project scope is divided such that Talisman is
the project managing the wells and subsea pipeline to the ETAP platform, while BP
is project managing the riser and topsides modifications.
The organization of the BP Fiddich project team is similar to the Farragon team, minus
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the Subsurface & Wells teams which are part of the Talisman project team. The key
part of the organizational design in this case is the relationship map between BP and
Talisman. This describes the key interfaces and communication channels between
BP and Talisman at the Owner, Commercial, Project team and Contractor levels and
is crucial to ensure the necessary alignment to deliver a successful project for both
parties.
This type of third party hub development requires a much deeper level of multidiscipline integration both within the appraisal team and across the BP and third party
project teams, plus excellence in Integrated Field Planning incorporating third party
requirements.

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6 toolkit

The toolkit is to support appraisal. The focus here is on tools that integrate across
the disciplines. An up-to-date list of tools is available on the BP MPcp web pages
http://mpcp.bpweb.bp.com and the appraisal network web page http://pe.bpweb.
bp.com/Default.aspx?tabid=416
Most contractors have a well-developed set of tools. The Concept Modelling and
Development team in EPTG can also assist. Where appropriate these should be
considered for use by the appraisal team where they improve work efficiency.
The key integration tools cover the following areas:

Concept Evaluation and Screening.

Risk & Uncertainty Characterization / Management.

Planning & Implementation.


6.1 Core multi-disciplinary tools
The multi-disciplinary tools recommended for use during appraisal are below. Support
is available from the EPTG Concept Modelling and Development team if required.
PetroVR (Caesar Systems)
This is a project planning, evaluation and decision support tool, enabling teams
to evaluate conceptual field development plans in an integrated environment,
incorporating risk assessments and economics. The tool has three modules: PlanVR
creates profiles and cost phasing from reservoir, well and surface layout data; EconVR
assesses Plan VR costings and profiles using the appropriate fiscal terms and price
assumptions to calculate economics; and PortfolioVR can create multiple EconVR
outputs. The first two modules are widely used within BP. A corporate license for
PetroVR exists.
Integrated Production Modelling (Petroleum Experts)
Mbal, Prosper and GAP are software packages that can be combined to model and
optimize production profiles and pressures from reservoir through the facilities to the
point of sale. BP has a global license to the software.
Integrated Planning Environment (Granherne)
This is an application in which surface and well layouts can be combined within a
Geographic Information System in order to model drill targets and centres, pipelines
and surface facilities together with surface topography and other infrastructure
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such as roads. Combining user defined cost and schedule information enables rapid
comparison of alternative development schemes.
Top Down Reservoir Modelling (BP)
TDRM is a technology developed by BP that consists of a philosophy and tools to
enable a faster and more robust exploration of uncertainty than has been possible.
The philosophy is to start investigations with the simplest possible model and
simulator appropriate to the business decision. Detail is added later as required. The
approach overcomes the problems of the conventional bottom-up process, which
uses detailed models that are too slow and cumbersome to fully explore uncertainty
and identify critical issues. Ongoing research and development is expanding the
scope from reservoir to wells and surface facilities.
OGM (BP)
Is used to generate the technical definition and costs for surface facility and
infrastructure components down to the equipment level for both offshore and
onshore developments.
OLGA (BP)
Is used to model steady state and transient response of pipeline networks to
demonstrate the viability of development solutions using multi-phase flow, e.g.
subsea well systems and gathering systems for cold climate onshore projects.
6.2 Emerging tools
Maximus (FEESA)
Maximus is a prototype integrated asset modelling software tool developed between
BP and FEESA. Maximus can provide deliverability predictions for complex converging
flowline systems through the lifetime of a project while simultaneously solving
rigorous thermal-hydraulic models for flow through wells, flowlines and risers.
VIPNOW (Pinnacle Resources)
This is a web-based spreadsheet tool used to support teams during Value Improving
Practice workshops. It enables the recording and more systematic reporting of
ideas generated and actions taken after the meetings. It has the added value of
enabling teams to search the corporate data base from other teams to see if similar
opportunities have been identified, and if so to learn from the outcomes.
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Clone (BP)
A work process tool developed jointly between BP and MIT to allow evaluation of
the economic value of standardized solutions either as clones of existing designs or
copies versus bespoke designs to assist business units in exploring the value of a
programme of standard solutions.
Major Projects Information Highway mpIH (BP)
A systems-orientated architecture and database structure is being developed by BP
which will allow the federation of development planning tools such as PetroVR, IPE to
allow rapid integrated evaluation of development options in both time and space.
6.3 Facilitation processes to support appraisal and development teams
bpSTART workshops (BP)
Strategic Technology Assessment workshops (bpSTART) can be used at the Appraise
stage to explore the potential value of combinations of both enhancing and enabling
technologies in creating development options. Use of enhancing technology biases
such as standardization, automation, operations optimization and predictable
performance can be assessed alongside any enabling technologies necessary to
make the development work. The process provides a methodology of rapid searching
of development options to identify a shortlist of those solutions which best meet
business expectations.
ALIGN workshops (BP)
Facilitated workshops can be used to develop contracting strategies or project
execution plans. These use techniques such as functional analysis, dependency
structure matrices and interviews to test project execution plans, optimise the
sequencing of activities, test project pace and resourcing plans and assist in aligning
contractor interfaces and expectations.
6.4 Knowledge management tools
MPcp is supported by a common framework for knowledge management which
is described in the MPcp Knowledge Management Guideline http://mpcp.bpweb.
bp.com.

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open discussion

written record
P&E SLS

Post a question
Search past discussions

Lessons

Project Library

Connect

Guidance
Templates
Tools
Examples

ETP Application

Project Forum

Find people and networks


in P&E and BP

Local SLS
Team documents

figure 6.1 knowledge management resources framework

This standard approach to knowledge management tools and processes enables


appraisal teams to access and share knowledge with the rest of the Major Projects
community. This means that the best collective wisdom can be brought to bear
where necessary in any situation.
Category 91 of the Exploration & Production Projects Library http://pelib.bpweb.
bp.com is the single federal repository where validated examples, tools, templates
and further guidance can be found relevant to the implementation of the MPcp
Knowledge Management Guidelines.
The Projects & Engineering Shared Learning System http://etpsl.bpweb.bp.com is
the single federal repository for validated lessons of relevance to the Major Projects
community.
Librarian support is available for the Library and the Shared Learning System via
GHouPELibr@bp.com
e-Projects http://eprojects.bpweb.bp.com is the BP online knowledge management
database for key project information.
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Projects Forum http://epforums.bpweb.bp.com/projects is the online question


and response tool for the projects and engineering community. As well as raising
questions, past discussion threads can be searched. Other discussion forums of
relevance to appraisal and pre-development are:

Well Engineering and Performance Forum (for Drilling & Completions, and Wells
function) http://epforums.bpweb.bp.com/wepf

OperationsCLIPS (for the Group Operations function) http://oe.bpweb.bp.com/


eclips/eclips.asp?ForumID=1

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terms & definitions

Accountability
The obligations and commitments assumed by an individual to deliver agreed
activities for which a delegation of authority has been given.
AGM
Appraisal General Manager.
Appraisal Plan
The Appraisal Plan is a formal document which outlines the scope of activities and
estimated expenditure in the Appraise and Select stages. The focus of the Appraisal
Plan is to enable an informed decision on project viability and concept selection.
ATN
Authorities to Negotiate.
Basis of Design
The Facilities and Drilling & Completions Basis of Design documents define the
respective technical basis for the project. It represents the conversion of the business
requirements (given in the Statement of Requirements) into a technical basis for the
project.
Brownfield projects
Projects involving modifications or additions to existing facilities.
BUL
Business Unit Leader.
EA
Engineering Authority.
EPTG
Exploration & Production Technology Group.
ETPs
Engineering Technical Practices.
FEED
Front End Engineering Design.

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terms & definitions

FM
Finance Memoranda.
GHSSER
Getting Health Safety Security and Environment Right.
GIAAP
Group Investment Assurance and Approvals Process. Procedures for establishing
authority to progress major capital investments. Reference GIAAP for format and
guidance for preparing FM and Authority to Negotiate (ATN) documents.
Greenfield
Projects involving new facilities resulting from successful access or exploration. They
can be tie backs or extensions to existing hubs.
GVP
Group Vice President.
HoD
Head of Discipline.
HSSE
Health, Safety, Security and Environment.
IPA
Independent Project Analysis.
KPIs
Key Performance Indicators.
MOC
Management of Change.
MPcp
Major Projects common processes.
NGO
Non Governmental Organizations. E.g. Greenpeace, Friends of the Earth, Amnesty
International etc.
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PDM
Project Development Manager.
PGM
Project General Manager.
PHSSER
Project Health, Safety, Security and Environmental Review. A seven-stage process
linked to the CVP stages, which provides external reviews of the Health, Safety
Security and Environmental (HSSE) activities of projects. Provides assurance to
management that projects are setting appropriate HSSE standards and meeting
those standards. Ref BP ETP GP 48-01.
PRM
Project Resource Manager.
PSCM
Procurement and Supply Chain Management.
Regret position
BPs exposure in terms of financial commitments if the investment or project does
not proceed.
Responsibility
The roles and enduring duties to be performed by a leader or team member that may
be individual or shared on an ongoing basis.
SDDN
Staff Development and Deployment Network.
SIMOPS
Simultaneous Operations.
SOR
Statement of Requirements.
SPU
Strategic Performance Unit.

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terms & definitions

SPUL
Strategic Performance Unit Leader.
TRL
Technology Readiness Levels.
TVP
Technology Vice President.
VOI
Value of Information.
WPM
Wells Programme Manager.

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2007 BP International Limited. All rights reserved.


This document is the confidential and proprietary property of BP and is provided solely for
use within BP by its employees or contractors who have a confidential relationship with BP.
Use or reproduction of this document is only by permission of BP and only for the purpose
or project for which it is disclosed and authorized. BP makes no warranty or representation
as to the accuracy, completeness, or usefulness of the information contained in the
document, or that the same may not infringe any third party rights. BP assumes no liability
for any damages that arise from the use of information contained in this document.
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EPTF Projects & Engineering


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Date of publication September 2007