Microsoft Unveils Information Technology Road Map for Achieving Peak Performance in the Oil and Gas Industry

HOUSTON — May 25, 2005 — Today at the 2005 Global Energy Forum in Houston, Microsoft Corp. will launch its Peak Performance Initiative, an information technology (IT) vision for the oil and gas industry. With a focus on Microsoft® .NET as the foundational methodology, Microsoft’s worldwide oil and gas industry unit has teamed with dozens of leading industry vendors to unveil a portfolio of Microsoft-based solutions that will create a strong and interconnected IT infrastructure to help oil and gas companies reach peak performance. This portfolio is designed to help companies meet and beat the future’s supply and demand, regulatory and cost challenges — and eventually realize the benefits of innovations that may render unplanned operational shutdowns across all industry sectors a thing of the past.

“Nothing short of peak performance will do in today’s dynamic oil and gas marketplace,” said Marisé Mikulis, worldwide oil and gas industry manager at Microsoft. “And peak performance has never been more challenging to achieve. At Microsoft, we are working with some of the industry’s best providers to develop and implement solutions that help companies achieve better business performance through accelerated insight and innovation.”

Oil and gas companies today already have the ability to monitor rigs remotely, collaborate cross-company and across the world, and diagnose potential refinery equipment problems before they happen. Now enabled by .NET — a set of software technologies connecting information, people, systems and devices via comprehensive support for IT industry-standard XML — Microsoft-based solutions should move industry efficiency and effectiveness to the next level.

Ability to Achieve Peak Performance

According to Rick Nicholson, vice president for Energy Insights, an IDC company, “Despite currently high commodity prices, oil and gas companies continue to face significant business challenges such as the difficulty in finding new supply sources, an aging work force and increasingly complex regulatory compliance. Our research shows that high-performing companies are not necessarily those that spend the most on information technology, but are those that do the best job of aligning technology investments with business objectives.”

To ensure that its solutions have a planned road map and align with customers’ business objectives, Microsoft invests more than $6 billion annually in research and development, enabling the world’s oil and gas companies to better seize opportunities, improve predictability and compete under dynamic market conditions through the innovative use of technology. Each Microsoft-based solution is cost-effective and built using widely accepted IT standards that leverage existing IT assets. These offerings integrate the enterprise today while establishing the foundation to be compatible with next-generation innovation.

“The pressure’s on for oil and gas companies to improve upstream and downstream business performance in the near term. Solutions grounded in .NET and supporting XML industry standards are imperative to deliver the integration, collaboration and knowledge management their businesses require,” Mikulis said. “Our vision is to offer companies the insights they need across the full business federation — from field production to refining feedstock including such complexities as delivery profiles, inventory in transit and variable contract obligations. This is the kind of innovative use of technology we’re working on with our partners and customers.”

Microsoft’s solutions portfolio focuses on four critical areas for the oil and gas industry:

  • Capital project execution. Using Project Intelligence tools and methods, companies have the ability to execute projects more reliably through timely and accurate project risk management and earlier time to first operation. They can also help decrease direct costs through better asset utilization, improved project management and reduced labor costs. These solutions are jointly delivered with Accenture, The Project Group Inc. and others.

  • Upstream portfolio management. By using technology to create a collaborative environment to improve decision and workflow quality across the oil and gas reservoir life cycle — thus achieving Oilfield Connectivity — firms can optimize production, reduce finding and lifting costs, and better address reserves replacement. Primary partners include OSIsoft Inc. and Schlumberger Information Solutions (SIS).

  • Downstream operational efficiency. Using tools and solutions to achieve superior operational and refining performance, smarter retail operations, and effective supply chain optimization can also help those in the downstream sector increase revenue by growing market share, improving asset performance and managing fuel prices. Companies can decrease costs by improving work-force performance and reducing operating and overhead costs. ABB, Aspen Technology Inc., OSIsoft, and SAT Corp. are some of the strategic partners in this area.

  • Health, safety and environmental (HSE) excellence. Today’s hardware and software can improve monitoring, tracking and reporting to help minimize health, safety and environmental concerns and decrease regulatory compliance costs. Better training and risk management processes improve security, reduce waste and emissions, and decrease injuries, which contribute directly to the bottom line. These solutions are jointly delivered with Accenture, Meridio and Software Architects, among others.

Research by Cynthia Moore, research vice president at Gartner Inc., highlights that business optimization of existing energy assets and infrastructure is a top business issue for oil and gas organizations in 2005. “Indeed, business optimization is on a par with management focus on environmental regulations and issues, and is linked to IT investments in other areas for oil and gas enterprises such as asset management and remote access technologies that ultimately can lower operational costs and increase productivity/profitability at the enterprise level,” Moore said.

Focus on Partners for Best Solutions

To help complete and deliver these solutions, Microsoft continues to partner with other oil- and gas-focused IT companies to supply innovative solutions, not only to help make today’s challenges easier, but to help enable the industry to reach its growth and profitability potential efficiently and safely.

“With Microsoft tools and technology, the development cycle for our products is significantly reduced, which accelerates our time to market,” said Blair Wheeler, senior vice president of marketing for Aspen Technology, a Microsoft partner in downstream and upstream. “By building our systems on a Microsoft platform, our customers can easily connect users across their global operations in a simplified way, using the same technology they’re used to using on a day-to-day basis.”

“We aim to revolutionize the way exploration and production companies approach decision-making. With the delivery of our unified seismic-to-simulation solution, which breaks down previous barriers to knowledge-sharing across technical domains, our customers are already realizing tangible business benefits. We see the convergence of technical and business applications as a critical next step toward a more efficient decision-making process,” said Tim White, vice president of Microsoft upstream partner Schlumberger Information Solutions (SIS). “We rely on Microsoft’s multi-industry expertise to provide a common development framework and standard technology platform with growth potential that we can readily deploy anywhere in the world — which makes these kinds of solutions possible.”

2005 Global Energy Forum Focuses on Accelerating Insight and Innovation

The 2005 Global Energy Forum, hosted today in Houston by Microsoft, will feature keynote addresses by Joseph Bryant, president and COO for Unocal Corp., and International Energy Agency Analyst Amos Bromhead. In addition, Microsoft will launch its road map for all aspects of the oil and gas industry, and host breakout sessions covering compelling industry issues and featuring leading-industry vendors and end users. Registered guests include more than 300 executives and business and IT leaders from a variety of international oil, gas and oilfield services firms.

“As Steve Ballmer summed up at CERAWeek recently, ‘our lifeblood is innovation,’ and we are committed, with our partners, to help this industry better seize opportunities, improve predictability and compete under dynamic market conditions through the innovative use of technology,” Mikulis said.

About Microsoft in Manufacturing

Microsoft, in conjunction with industry-leading partners, delivers enterprise solutions to a range of manufacturers including those in vertical industries such as automotive, chemicals, consumer packaged goods, high technology, and oil and gas. These industry-specific solutions provide a flexible, scalable and reliable platform that enables businesses to be more agile and connected. As a result, manufacturers are empowered to shorten product development cycles, integrate operations with partners and suppliers, acquire and share intelligence in real time, and more easily communicate with customers. More information about Microsoft in manufacturing can be found online at /manufacturing.

About Microsoft

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

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