Override Inventory
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Overview
The Override Inventory screen allows the user to change oil and gas by-products' opening inventory in a production month. Typically, the calculated closing inventory from the previous production month is used as the opening inventory in the next production month. However, there may be situations where the opening inventory must be modified to be different from the previous month’s closing inventory. This could be a change to the facility total opening inventory with the corresponding re-allocation of the new opening inventory to the well/owner level or just a re-distribution between wells or owners within the facility with the total opening inventory for the facility remaining the same.
Inventory can be overridden at the following facilities:
Plants (all Products)
Balance Only products can be overridden only at the facility level since these products are not allocated down to entities and/or owners.
Gas Flow GGS/Batteries (all Products)
Balance Only products can be overridden only at the facility level since these products are not allocated down to entities and/or owners. For Gas Flow Batteries, Water is considered a Balance Only product.
Non-Gas Flow Batteries (Oil and Water)
Water can be overridden only at the facility level since it is not allocated down to entities and/or owners.
Once an Override has been entered for a specific facility and product for a production month, re-calculation of the previous month that impacts closing inventory for that month will not be automatically reflected in the next month’s opening inventory. The entered Override Inventory will continue to be used for the production month.
Once the Override Inventory records have been created on the screen, the override volumes at the owner level can be imported using the Import Data by Template - FACILITYOVERRIDEOPNINV process instead of manually entering them on the screen. For more information see How to: Spreadsheet Import Facility Override Inventory.
Override Total Inventory for a Facility
Select the Facility from the Explorer hierarchy and click on the Override Inventory menu from the right-hand menu.
Select the Product to override and enter the total Override Opening Inventory volume. When you click Save the Override Opening Inventory you entered will be reflected on the appropriate Balance screen for the facility/product.
For Water at a Battery or a Balance Only product at a Plant or Gas Flow Battery/GGS the facility total opening inventory is all you will be able to override. The Edit button for the Entities and Owners tab will remain disabled.
The Remaining To Allocate volume will reflect the difference between the Facility level inventory (either what was carried over or the override that was entered) and the sum of the entered override inventory at the Entity/Owner level. This means that until there are Entity/Owner level override volumes entered the Remaining To Allocate will remain zero.
The Delete button will be disabled unless there are Entity/Owner level overrides entered. The Delete button will delete all Entity/Owner level overrides entered but will not delete any entered Override Opening Inventory at the Facility level. To delete a Facility level override volume you simply clear the Override Opening Inventory field (the field should be empty to indicate that the Carried Forward Opening Inventory should be used).
Based on the above examples, the Battery Balance screen will now display the above total Override Opening Inventory volume as the Opening Inventory.
Next you would balance the Facility given the new opening inventory volume(s) and process Steps 1 - 2. The Facility may not process successfully and a message similar to the following may be displayed within the Message Centre for non-Balance Only products.
This message is indicating that the facility total inventory (Opening Inventory) does not match the sum of the inventory allocated to the entity/owner level (Total Opening Inventory). This occurs because the entity/owner level opening inventory is coming from the previous month’s closing inventory which still reflects the original inventory volume of 13.0.
When you launch the Override Facility Opening Inventory screen after processing, the Entities grid and the Owners grid within the Override Facility Opening Inventory screen will have the Carried Forward column populated with the Well/Tracts/Owners associated with the selected Facility/Product based on the previous month’s closing inventory. Now that the total opening inventory for the facility has been modified you must adjust the opening inventory at the entity/owner level to allocate the new total volume by clicking on the Edit button.
Edit Override by Entity/Owner
Once the facility has been processed, the Entities and Owners tabs are populated with the Wells/Tracts/Owners associated with the Producing, Sending Batteries, and/or Flow Group. When overriding Water at a Battery or any Balance Only product (Plants or Gas Flow Batteries and Gathering Systems), only the total Override Opening Inventory volume is required. Therefore, Entity/Owner updates are not required/allowed, and the Edit button will remain disabled.
You have two options when updating the entity/owner level inventory volume, you can enter the total inventory for the entity (Entities tab) and let the system allocate that volume down to the owners based on the default DOI for the entity, or you can enter the inventory volume at the entity/owner level (Owners tab) directly and let the system sum up the owner volumes entered for each entity to calculate the entity total.
There are a few considerations when entering inventory volume at the entity level. There may be more than one inventory volume for the same entity, as the entity level key fields include the Producing Battery, Sending Battery, Flow Group and Well/Tract. This means that you may have to override more than one inventory volume for the same well/tract. Entities without DOIs, wells that are not on production, default Source Wells (Outside Receipts), entities associated with Battery-to-Battery receipts, and entities associated with a Flow ID must have their override inventory volume entered at the Entity/Owner level since there is either not a valid DOI or the volume was not based on DOI allocation (Outside Receipts, Flow Groups).
Reminder: The Flow ID column will only be displayed in the Entities and Owners tab when the Facility is Gas Flow, except for Oil for Gas Flow Batteries.
When first creating override volumes at the Entity/Owner level, you should click the Override = Carried Forward button. This will create Override entries for every Entity/Owner based on the opening inventory that was carried over from the previous month’s closing. This gives you a starting point from which you can then modify the Override volumes. It should be noted that clicking the Override = Carried Forward button will display a pop-up indicating that this will replace any override opening inventory and if OK clicked it will automatically Save the created override volumes but will leave the screen in edit mode so you can make any additional changes. This will also trigger the calculation of the Remaining To Allocate so you can more easily see the difference you have to account for in your modifications.
Entities Tab
On the Entities tab you can enter Override volume for the entities where the column is enabled. Remember entity volumes that may not be based solely on DOI must be overridden on the Owners tab. This includes entities with no valid default DOIs, wells that are not on production, default Source Wells (Outside Receipts), entities associated with Battery-to-Battery receipts, and entities associated with a Flow ID.
Reminder: The Flow ID column will only be displayed in the Entities and Owners tab when the Facility is Gas Flow, except for Oil for Gas Flow Batteries.
Overriding inventories at the entity level will apply the appropriate default DOI to allocate the override volume down to the owners where the Inventory Type is WIO.
As an example, if we modify the entity level volume for one of the above entities (RLTGFCUT1 where Sending Battery is RLTGFCNPB2) to 1.2 and click Save. The Override column remains 1.2, as we entered.
If we switch to the Owners tab and isolate the same entity we can see the that the 1.2 was split between the records with Inventory Type = WIO, owners VEN67756, VEN7000 and 000020. The split was based on the default DOI for the RLTGFCUT1 tract (000020 - 2%, VEN67756 - 85.25%, VEN7000 - 12.75%).
This means that if the entity total opening inventory is made up of different Inventory Types, only the WIO types will be adjusted when the entity level volume is modified, and the sum of the owners may end up being different than what was entered at the entity level. The sum of the owners will take precedence.
As an example, if we adjust the above scenario so that some of the opening inventory being carried forward from the previous month is for Inventory Type = CRWN, then we can see the potential issue. In this adjusted scenario we will again modify the entity (RLTGFCUT1 where Sending Battery is RLTGFCNPB2) from 0.9 to 1.2.
But now when we click Save, the Override column has been changed to 1.4 even though we had just entered 1.2.
To see what happened we will go into the Owners tab and isolate this entity. The 1.2 entered on the Entities tab was allocated down to the WIO records and the CRWN inventory was left as 0.2. This is another reason you may want to make any inventory changes at the entity/owner level, so that you can make sure to correctly account for all types of inventories at the entity.
For Gas Flow facilities (other than Oil at a Battery) the Flow ID column will be visible.
Note: It is possible for the same entity to have inventory with and without a Flow ID, as with RLTGFCUT1 in the example below. Also notice that the record with the Flow ID populated has the Override column disabled, inventory associated with a Flow ID must be entered at the Owner level.
When not in Edit-mode you can click the Print Friendly button to launch a more simplistic, non-paged view of the entity level data which you can then Print. There is also a Qbyte Optix report called Inventory Override Details that you will show the Override Inventory volumes.
Owners Tab
On the Owners tab you can enter Override volume for the entity/owner. Overriding inventories at the owner level will be accumulated to the entity level to be displayed on the Entities tab. The volumes displayed at this level include more details about the volume such as Inventory Type and the Royalty TIK fields (Reference Owner, Royalty Obligation).
Reminder: The Flow ID will only be displayed for Gas Flow facilities, except for Oil for Gas Flow Batteries.
For Gas Flow facilities (other than Oil at a Battery) the Flow ID column will be visible.
When not in Edit-mode you can click the Print Friendly button to launch a more simplistic, non-paged view of the entity level data which you can then Print. There is also a Qbyte Optix report called Inventory Override Details that you will show the Override Inventory volumes.
Impact of Previous Month Amendments to Opening Inventories in the Next Month
When the facility total closing inventory remains the same but the allocation between the entity/owners changes for the previous month, the next month’s entity/owner level opening inventory will be available to be carried forward in the next month (the previous month’s closing inventory is retrieved as the next month’s opening during processing of Steps 1 - 2 of the next month).
When there are no Override Inventories entered at the entity/owner level for the next month:
When the next month is processed for Steps 1 - 2 the entity/owner level closing inventory from the previous month will automatically be carried forward as opening inventory for this next month and there is no further effort required.
When there are Override Inventories entered at the entity/owner level for the next month, then those will be applied regardless of what the previous month’s adjusted closing inventories are.
When processing the previous month you will see a message in the Message Centre indicating that there are Override Inventories in the next month that you should review.
When the facility total closing inventory volume changes for the previous month, the next month’s facility total opening inventory is not automatically updated, however the entity/owner level closing inventory is available to be carried forward into the next month (the previous month’s closing inventory is retrieved as the next month’s opening during processing of Steps 1 - 2 of the next month).
When there are no Override Inventories entered at the entity/owner level for the next month:
When the next month is processed for Steps 1 - 2, a message like the following will appear indicating that the facility total opening inventory (Opening Inventory) does not match the sum of the entity/owner opening inventory that was carried forward from the previous month (when the product is Water at a Battery or a Balance Only product at a Plant or Gas Flow Battery/GGS there will be no message generated as those products are not allocated down to the entity/owner level).
When opening the Balance screen for the next month (Plant Balance, Gas Flow Balance) a message will appear indicating that the Opening Inventory does not match the previous month’s Closing (there is currently no message on the Battery Balance screen for either Oil or Water when this scenario occurs).
To resolve these errors, you simply need to click the Edit button for the Product Balance section and then make a change. In this case we could update the Closing Inventory to reflect the difference between the original opening and the previous month opening (assuming our production, disposition, etc. volumes remain the same) and click Save. A pop-up will appear asking if you want to update the Opening Inventory based on the Previous Month. Clicking OK will update the Opening Inventory for you with no need to enter Override Inventory volumes.
When there are Override Inventories entered at the entity/owner level for the next month, then those will be applied regardless of what the previous month’s adjusted closing inventories are.
When processing the previous month you will see a message in the Message Centre indicating that there are Override Inventories in the next month that you should review.
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