ARO Management by Spreadsheets Doesn’t Work… Here’s Why.
Spreadsheets are easy-to-use, highly customizable, and come at no additional cost to most companies, so it is easy to see why they have become the default tool of choice for maintaining asset retirement obligations (ARO). However, as end–of–life closure activities and obligations have grown in importance and complexity, managing an ARO program through spreadsheets comes at a hidden cost. The initial benefits of spreadsheets – flexibility, familiarity, and affordability – can’t overcome the challenges posed by utilizing a tool never made for this job.
Excel wizards do love a good spreadsheet, and with such wizardry it can be a fine tool. But when should you consider moving beyond a spreadsheet for ARO management? We talked to many E&P companies to get their perspective on when and how they know they’ve outgrown their trusty tool for this purpose.
Here are some of our favourite quotes from those who have outgrown their spreadsheets:
Do any of these issues resonate with you?
Our investigation continued to further uncover the most important advantages that happen when companies move to a central management tool. Interdepartmental use of various ARO reports were appreciated. Clarification of changes within the data flowed easily based on the history trail of users and inputs. Formula integrity remained intact and pulling quick reports for banks, investors or auditors became as simple as a click of a button.
At XI, we have become a go-to for ARO management because of the problems we’ve solved. AssetBook ARO Manager was purpose-built for the oil and gas industry, developed through a culmination of government resources, expert opinion, and industry data. Plus, it is SOC 1 Type 2 compliant (read the press release here) everyone can trust the calculations.
Figure 1 – ARO Manager provides users with a simple, comprehensive look at their end-of-life closure activities and obligations, available to anyone in their organization who needs the data.
You can read more about the various struggles our clients have had with their ARO spreadsheets, including dedicated hardware solutions and “the Rainbow Unicorn Spreadsheet of Barf” by reading our case study “The Problem with Spreadsheets in ARO Management” or contact us for a demo.