- The OOC Oil & Gas Blockchain Consortium is an oil and gas industry consortium.
- The purpose of AFEs is to approbate the expense & capital projects & accredit the working interests among various parties.
- The AFE balloting proof of concept (POC) examined to make elections electronic using Blockchain Technology.
The OOC Oil & Gas Blockchain Consortium, in Houston, who engaged with GuildOne, enunciated today the first victorious application of the Blockchain industry for Authorization for Expenditure (AFE) balloting.
The OOC Oil & Gas Blockchain Consortium is an oil and gas industry consortium, established to advance blockchain technology with the objective of driving industry learnings, guidelines, frameworks and capabilities around common industry pain points.
The purpose of AFEs is to approbate the expense & capital projects & accredit the working interests among various parties who are under a joint operating agreement, mainly in the oil & gas industry. Conventionally, it handled manually & majorly a paper-driven phenomenon. The drawback to this was eloquent usage of time & conflicts of the working interest in results.
But Blockchain dumbs down the approval process, thereby minimizing errors & saving considerable time. Besides this, it also assists in documentation of final working interests.
The AFE balloting proof of concept (POC) examined to make elections electronic using Blockchain Technology by utilizing the ability to send ballots & estimating the working interests digitally. Using Blockchain nodes, the operator in the rest digitally presented AFEs under a multitude of scenarios to nine non-operating partners.
Thus, it automatically worked on a percentage of working interest based on elections made by each partner. Under this system, Balloting lasted for various rounds till a final working interest was hell-bent among parties who are participating.
Rebecca Hofmann, chairman of the OOC Oil & Gas Blockchain Consortium, said that they’re very overwhelmed about the completion & successful testing of POC in less than four months. The successful testing is in itself a testimony to the power of this technology & its ability to mend fundamental oil & gas business activities.
JD Franke, the vice-chairman of the OOC Oil & Gas Blockchain Consortium, said that AFE Balloting demonstrates just one of the multiple use cases with common industry pain points. This also suggests that the success of POC can leverage learnings to realize key blockchain frameworks for the oil & gas industry.
The POC is an integral step in the path of making joint venture management in the oil and gas industry. In 2020, the AFE balloting scope will expand to cater to more sophisticated scenarios, while initial design and testing will perform on the joint interest billing (JIB) exchange process, which deals with the invoice and payment of expenditures between joint venture partners. The aim is to streamline JIB exchange with AFE balloting for a perfect end-to-end way to manage joint venture operations.