Season's End

Bill Gross the bond king intimated that there is always someone with a sandwich board predicting armageddon. Well if the shoe fits, I’ll certainly wear it. But that’s not the case here at People, Ideas & Objects. There is a deep, fundamentally broken oil and gas industry in North America. A once in a millennium fire in Canada will be resolved in the short term. This fundamentally broken industry has manifest its issues since the late 1970’s and will not be resolved until action to implement the Preliminary Specification is taken. If you believe that I am predicting demise on the basis of some apocalyptic theory then that’s fine, you can stop reading. If you believe that I am trying to solve an issue then we can continue.

If you believe that the commodity markets have rebalanced and the bureaucrats have fixed the problem, then there is nothing here for you either. To me these commodity markets appear to be capitulating. Going through the process of having major participants leave the industry as there is nothing for them. Abundant losses, no discussion about the issues and no thought that there is a problem and certainly no action to resolve the problem. These have a negative impact on people’s confidence. So yes I’m in no way optimistic about where the price of oil and gas will be heading. Gas storage will be filled this summer leading to another major step downward in pricing. Oil has Iran and Saudi Arabia competing for new customers and new demand from current customers to the tune of 4 million barrels per day. Bureaucrats, I think, have been effective in running up oil and gas prices in the short term to provide a narrative that offsets the losses they’ve incurred. Losses that in many cases wipe out the entire capital base of the producer. If that doesn’t scream at you, nothing will. Now that the agm season is over, we’ll see if the commodity prices normalize.

It is these low commodity prices that people believe is the issue. I would suggest that it’s a symptom of the larger issue addressed by the Preliminary Specification. That being, the accounting in oil and gas makes it appear to be a profitable industry because none of the actual costs are being recognized. This keeps an unprofitable and unviable industry continuing on the basis of the chronic and continual investment of capital from investors and banks. The comprehensive and continued support of producers capital programs, when continued, make the industry appear a viable going concern. Take away the investment dollars and you have a cash starved beast that can’t maintain its asset base, which is marketed as an advantage under the narrative of “market rebalancing.”

What is particularly disappointing to me is that this has gone on for so long it’s the culture of the industry. The entire industry has been raised, educated and trained on this basis and never questioned if it was a valid, functioning business model. When the producers continue to report that they’re profitable. Despite what may or may not have occurred within the producer firm. It attracts more investment. And in the case of oil and gas, more investment than the industry can handle which has lead to overproduction in the commodities. We saw this phenomenon play itself out for almost two decades in the 1980’s and 1990’s when oil prices were too low. Nothing was done, no one questioned the actions of the producers, it was just “oh woah is me,” another bad year has passed. And muddling through continued. That’s not how you operate a business and in 1991 I set out to do something about it and today that something is the Preliminary Specification.

The other day I unilaterally declared that I had the credibility going forward to fix the issues in the marketplace. This caused some laughter and commentary from my friends the bureaucrats who feel buoyant now that oil prices have recovered to as much $50! I would warn the bureaucrats not to declare anything too prematurely. The credibility that I claimed was with the investors who have not necessarily been inspired by their management. If all you’re providing them is a mirror image of the commodities activities, both up and down. Followed by a wholesale destruction of the firm in the long run. Then I would be more concerned about your credibility in that sense, rather than your momentary ability to predict an upswing in a commodities price. These problems are not solved. They aren’t accepted as being a problem and the industry has rejected the thinking contained within the Preliminary Specification by not yet adopting it. This is due to the self serving reasons that the Preliminary Specification disintermediates the bureaucrats. We are the Uber, and they are the taxi commissions. And therefore, maybe I too have misdiagnosed what really ails the oil and gas industry.

The Preliminary Specification and user community provides the oil and gas producer with the most dynamic, innovative, profitable and successful means of oil and gas operations. People, Ideas & Objects Revenue Model specifies the means in which investors can participate in these user defined software developments. Users are welcome to join me here. Together we can begin to meet the future demands for energy. And don’t forget to join our network on Twitter @piobiz anyone can contact me at 403-200-2302 or email here. 

This is All About Leadership

We are at an inflection point in the oil and gas industry. If you believe that “market rebalancing” will have a remarkable effect on commodity prices, and the good times are just around the corner then there’s nothing here for you at People, Ideas & Objects. This is the point in time when those that will be leading the industry in its next iteration stand up and say that “this” is no longer good enough. It comes down to the point of what do you believe. Are we in a minor disruption that will clear itself, or is this a wholesale upheaval of the industry. One that requires action by many people to clear out the stale and non-functioning elements of the industry. Creative destruction at its finest hour.

If you’ve been reading this blog for a while you know I appreciate the work of the oil and gas bureaucrats. I won’t go into their many deficiencies but will point you to this blog's long history on the topic. I’ll assume instead that you are that leader who is tired of the status quo, who is concerned about the state of the industry and the lack of action by the bureaucrats. If you are, this is the place you want to be. We have 5,000 man years of work ahead of us in developing the Preliminary Specification and moving the industry onto a commercial footing. And that is just the software development portion of the task that we are undertaking. Leadership everywhere and at all levels of the industry is going to be demanded to fix “this.”

The other day we talked about the Leadership teams within People, Ideas & Objects and our user community. These are the leadership positions that are necessary for just the software development, and only those that can be clearly identified at this time. There will be many more as we proceed. Those members of the user community, the 3,000 people we’re looking to provide our software developers with the precise details of how it is the oil and gas industry operates. These are leadership positions as well. The user community member will have to know what it is that is necessary to make the Material Balance Report everything that it could possibly be. For example. And have the resources within the industry to verify that information. Our user community is the critical element of our softwares ultimate quality. Their leadership will be something that we will be looking for them to provide.

The secondary role the user community member fills is that of the principle in the organization that will be developed to provide the People, Ideas & Objects software and that organization's services to the producers. Our “service providers” will be established by the user community members who will own and operate them. They will be the ones that lead these organizations and develop the service based organizations that the producers will need in the new industry configuration that is required to provide our price maker strategy. Recall the service providers will be providing the entire oil and gas industry, as their client base, the process management of one individual process. This may seem like an onerous data driven task that would be monotonous and boring to undertake. I disagree, this will be a dynamic and exhilarating place to work. The competitive advantages of the service providers are their automation, specialization and division of labor. With the access that the service providers principle, the user community member, has to People, Ideas & Objects software development capabilities. The service providers will be able to iterate and constantly improve the software they use, and their service offering to the producers, both in terms of their speed and quality. Service providers will undertake all of the industries administrative and accounting capabilities. There is movement away from each producer developing their own similar, redundant administrative and accounting capabilities that are not shareable or usable outside the producer firm. It is this overhead that is also inhibiting profitability in the industry.

Again we have only touched on the leadership that will be necessary in the software and services areas as a result of the changes that will be instituted by the Preliminary Specification. The producers themselves will be going through a process of rapid change as well. Leadership will be needed to see them through the changes that will be made through this software and service development process. A leadership team to match the activities occurring in the People, Ideas and Objects software development, our user community and service providers. Investors and bankers will be taking a different attitude towards investing in oil and gas. It will be a while before they come back. That is, they will not be back until we can prove that the industry is consistently profitable based on a detailed, actual accounting. An accounting that looks at the performance of the management, not an accounting that tries to emulate the valuation of the company. Only then will they return. Therefore additional leadership needs will have to be met within the producer firms with an understanding that the old guard will be gone and the new ways will have to have new corporate leadership.

The Preliminary Specification and user community provides the oil and gas producer with the most dynamic, innovative, profitable and successful means of oil and gas operations. People, Ideas & Objects Revenue Model specifies the means in which investors can participate in these user defined software developments. Users are welcome to join me here. Together we can begin to meet the future demands for energy. And don’t forget to join our network on Twitter @piobiz anyone can contact me at 403-200-2302 or email here.

Memorial Day Holiday

No Posting Today

Third Friday Off

Leadership Roles

In addition to the CFO position that we need to fill, People, Ideas & Objects is developing the following Leadership Teams. These teams will be permanent full and part time members of People, Ideas & Objects and the user community, a separate entity. Ownership of the user community is held by People, Ideas & Objects but will have its own Leadership Team. This is to accommodate the unique characteristics of the user community and ensure that the focus remains on providing the producer with the most profitable means of oil and gas operations. Members of these Leadership Teams will be those that can make a difference in the industry, who see this as an opportunity to make the changes that are necessary to reset the industry on an appropriate commercial footing. People who are interested in a challenge and are not afraid to jump in.

In terms of the needs for People, Ideas & Objects we are looking for two people. The CFO which we mentioned the other day. And the President & COO. These two positions are based in Houston and report to me. The President & COO will be wholly responsible for the software developments. If either of these positions interest you please contact me here. These are the key elements of the Leadership Team of People, Ideas & Objects. There will be more positions open as the funds begin to flow. Be sure to keep up to date here.

The user community has been our priority for the past number of years. Our biggest impediment to the development of the Preliminary Specification is getting the ideas contained within the specification into the heads of the approximately 3,000 members of the user community. We have been pushing the Preliminary Specification out to the industry at large for the past two and half years since its publication. And we are generally unaware of where we are exactly in terms of achieving that number. It is important to note that we will not start developing software until the user community in its full form is in place. User community based software developments are the key to quality and that is the only basis that we are approaching the development of the Preliminary Specification. I can assure you that many people are reading the Preliminary Specification each and every day. It's important to get these ideas in the heads of the user community so that they can think on this new basis and ensure that they implement their piece of the system based on this new, fundamentally different understanding of using the Joint Operating Committee.

The Leadership Team of the user community consists of a large team of people who will be involved. I will be sitting as the Chairman of the organization, and there will be a board of four other directors. In addition there will be a CEO, CFO, and COO. These are the standard fare positions that will undertake their standard roles within this organization. Please note they are separate from the software development team. They are exclusively concerned with the process and functionality of the applications of People, Ideas & Objects. Please read the user community vision if you haven’t. To understand how this user community organization is uniquely structured within the oil and gas industry. A structure that ensures it has the power and control over the Intellectual Property that makes up the applications they are responsible for.

The last set of members in the user community Leadership Team are the Product Owners. In an agile development team a product owner is part of the software development team. They are responsible for the product and will be required to prioritize the software teams developments. Funnelling the user communities contributions into a coherent and usable application will be part of their responsibilities. We are making these Product Owners key parts of the user community Leadership Team. We have allocated a section in our budget for these individuals with healthy compensation, administrative support and a discretionary budget. We are looking for a total of 25 product owners to join our team. One for each module of the Preliminary Specification. The remainder are allocated to specific areas such as the user interface, mobile, data model, etc. As with all of the members of the Leadership Team, their background will be in oil and gas with a strong aptitude towards technology, augmented with some post secondary education in Information Technology.

#!/bin/sh is the starter's pistol for everyone to begin the competition. The industry needs these positions filled and people to start working and organizing the solution for the industry. I am working on the money and you’ll have to take it on faith that the producers will act. What choice do they have? Bankruptcy. Therefore it’s up to us. This will be a difficult task and there is no certainty of success. We will not fail because we can not fail. The industry would be out of options if we did fail.

The Preliminary Specification and user community provides the oil and gas producer with the most dynamic, innovative, profitable and successful means of oil and gas operations. People, Ideas & Objects Revenue Model specifies the means in which investors can participate in these user defined software developments. Users are welcome to join me here. Together we can begin to meet the future demands for energy. And don’t forget to join our network on Twitter @piobiz anyone can contact me at 403-200-2302 or email here. 

More Bureaucratic Abuse

Producers actions in these next few months will be the critical difference to their success or failure as an organization. Sitting around praying for “market rebalancing” will be the most effective way to achieve their demise. Pretending that they’re a viable going concern and continuing to fleece their banker and investors for more capital isn’t going to work anymore. At the same time bureaucrats will have to find that cash from somewhere. As the banks put the brakes on realizing the proceeds of any material transaction, their only source of cash is production. Which of course is the only source of cash anywhere in the industry. Which of course leads to further declines in the prices of the commodities due to further overproduction. We’ve seen this play out a few times now. What is it that bureaucrats think will change this time? They need to act now. People will be looking back to this time to see what they’ve been doing to solve these issues. If they find the producer has been hunkering down waiting for the “market to rebalance” that producers bureaucrats might find the office taking on a streetscape like appearance.

What producers need to do instead is subscribe to the development of the Preliminary Specification. They’ll need some money to do this so they’ll have to find some to make the necessary commitment. To determine their share they’ll need to calculate our budget times the amount of their deliverability, in relation to the total deliverability of oil and gas for North America. That share of our costs will be their upfront commitment to this development. No one said this was going to be easy. The scope and scale of this problem demands that a solution be provided. The upside is that they might be able to fend off any attempts to run them out of the business by the bankers and investors. Showing them that they have a plan as to how to deal with the situation might make the investors and bankers feel more comfortable than they do now. Secondly, the upside of doing this, that is our value proposition is in the range of $25.7 to $45.7 trillion over the next 25 years. This as a result of our price maker strategy and the ability of the industry to begin to return the capital that’s invested in it. Establishing the industry on the basis of the most profitable means of oil and gas operations. Making it a commercial enterprise not this daycare inspired activity exercise.

I’ll bet that stung a bit. Take a critical look at the industry today. The present value of the North American industry is worthless. Nothing of value is being generated by it as a commercial business. Its activity for the sake of activity. Doing rather thinking. Is this the best that the industry can do? Can we take what we have today and rise to the challenge of meeting the needs of our investors and consumers over the next 25 years? Not on the basis of this lot. And not on the basis of kneeling down and praying for the “market to rebalance.” It’s time to shape up and start doing the job that has been entrusted to the industry. Take a position; lead, follow or get the hell out of the way.

Why did we have to take it to this level of destruction? That is the question that I guess we’ll never know. It seems human nature to want to keep trying the old ways until it's obvious they no longer work. The point is that we can start to focus on the solution now and begin to make the changes that are going to turn the oil and gas industry into the dynamic, innovative, accountable and profitable oil and gas industry that it needs to be in the long run.

The Preliminary Specification and user community provides the oil and gas producer with the most dynamic, innovative, profitable and successful means of oil and gas operations. People, Ideas & Objects Revenue Model specifies the means in which investors can participate in these user defined software developments. Users are welcome to join me here. Together we can begin to meet the future demands for energy. And don’t forget to join our network on Twitter @piobiz anyone can contact me at 403-200-2302 or email here. 

Wanted, Our CFO

In anticipation that we are about to begin the process of building the Preliminary Specification. I am announcing today that we are seeking our first employee. Our CFO. We are looking for a world class CFO that can fill the position that is needed within our organization and will provide for the needs of the oil and gas producers, our user community and the service providers. As a startup there will be much to do for this individual. That pretty much defines the position, we need everything and have nothing. Those that are interested should email me here.

In follow up to our Friday post in which we discussed the demise of the credibility of the oil and gas producers. How it has been spent with the investment community as a result of the bureaucrats self-serving ways and running the industry into the ground. I want to announce as well that the line forms to the right. That is to say, as I noted in last Friday’s post, that to reestablish yourself as a profitable oil and gas producer is the credibility that needs to be earned. Therefore for oil and gas producers to earn that credibility and to prove that they are focused on profits, will be achieved by subscribing to the software development of the Preliminary Specification.

Continuation of the status quo is always an option. However, just as with ideas, choices have consequences. Going it alone will possibly enable the bureaucrats to make it through without the support of the banking and investment community. That's a tough road to hoe. The easy route would be to pay the subscription for our budget and, here’s the other requirement, actively participate in the developments. The broad scope of industry understanding needs to be captured in the software that we are developing. That is not going to happen without the user community being in the leadership role in terms of how these applications function. The user community will need the producers participation for a variety of reasons to ensure a quality of the final product and to ensure that it meets the producers end use needs. There is no solution that is going to meet your needs without your blood, sweat and tears on the floor. Paying the bill for our budget is the first step and should be representative of the understanding of the significant commitment that you as a producer are undertaking to ensure that your needs are effectively communicated and captured in the software. If this initiative fails don’t look to me or the user community, failure will be 100% attributable to poor producer participation and producers do not have the option of failure.

If you're still sceptical that I can raise your sinking boat out of the water. Talk to your bankers and talk to your investors. They have some skin in the game. They have no interest in your organization failing. If you told them that you had an initiative that you were participating in that would return your firm to profitability, has a price maker strategy, and that you needed their support to turn your producer firm around. The skies might turn and a little less black and bit more blue. What do you have to gain.

The Preliminary Specification and user community provides the oil and gas producer with the most dynamic, innovative, profitable and successful means of oil and gas operations. People, Ideas & Objects Revenue Model specifies the means in which investors can participate in these user defined software developments. Users are welcome to join me here. Together we can begin to meet the future demands for energy. And don’t forget to join our network on Twitter @piobiz anyone can contact me at 403-200-2302 or email here. 

Victoria Day in Canada

No posting today.

Credibility

In the last two days I have detailed the reasons that the oil and gas industry is in the state of decline that it’s in. That accounting and economic misinterpretations have negatively influenced the culture of the industry. And the primary reason for this decline is inaction by the bureaucrats whose motivation is inconsistent with the needs of the industry, the investors, the people who work in the industry and the service industry. Bureaucrats are, as I have stated, only lining their pockets at the expense of others. They have a healthy operation that has served them well for the past several decades. Their motivation is to hold still to keep the status quo filling their pockets.

And let me be candid for a moment. It could be stated that Bernie Madoff didn’t fully comprehend the accounting principles in which he was reporting to his investors. And it also could be stated, in Mr. Madoff’s defence, that he misinterpreted some of the fundamental economic principles of the work that he was doing. Others, and there are many, think he’s a crook. Madoff went about misrepresenting the value of the assets that he held and reflecting higher profits than what the fund was earning. His operation was stopped when the FBI no longer accepted the story that was being told in his statements. Otherwise Mr. Madoff would have continued with his operation to this day. So when oil and gas bureaucrats talk about rebalancing the market, which is also known as deliberate destruction, what are we really talking about? Are they just trying to keep the operation going for a while longer? Or are they trying to get to the core of these issues and resolve them?

At what point does an industry move from being given the benefit of the doubt to being questioned as to its motivations? We have had a difficult past decade since 2008. The financial crisis. Natural gas prices collapsed and continue to slowly erode. The natural gas overproduction was then matched by the overproduction in oil to cause both sides of the business to be in difficulty. A situation that hasn’t happened before. Is this environment the one we should learn to accept as the norm with the lethal combination of shale and bureaucrats? The decline in the business has created the narrative of “market rebalancing” that took us through 2015’s earning season and annual general meetings, only to lead to no action, no plan and no discussion of the issues. Only destruction. It's at this time that the bureaucrats can start the party for the next eight months? No need to account to anyone.

How much of your money are you willing to invest in Bernie Madoff. And the related question, how much are you willing to invest in oil and gas. I wouldn’t touch either with a ten foot pole. Both have serious credibility issues that are unresolved in the marketplace, in my opinion. I think until those issues are resolved the credibility to raise any money will be in jeopardy for any serious producer seeking any serious money. And maybe I’m late to the game here. Or maybe I’m the one that’s keeping score. The amount of junk bonds issued by the producers had been significant in the last two years. Maybe the investors had these credibility questions well before this point in time leaving only the junk bond market as a source for funding. What I might be doing here is noting the point in time where the industry rope is going to suddenly become taunt. The rope being the proverbial rope that the investors were willing to give to the bureaucrats to give them the benefit of the doubt. Now with the Annual General Meetings out of the way with no action, no plan and no ideas. That’s it.

I have been barking about these points on this blog since 2005. I published related documents on this topic as early as August 2003. People are tired of me barking about this. I’m tired of barking. What has barking at the moon accomplished? Credibility that I understand what the issues are. I set out to solve this problem well before it was even seen as a problem. I also set out to develop the solution. The foundation of the Preliminary Specification is the use of the Joint Operating Committee which is what I published in August 2003. I’m either barking mad or I’m just really lucky. Either way I now have the credibility to reestablish the industry on the foundation of a commercial enterprise. The bureaucrats don’t, can’t, won’t and will not ever make the necessary changes. That may be a bit of a stretch for some people to accept. Maybe they’ll find a way to solve this in the future.

Our claim is that we provide oil and gas producers with the most profitable means of oil and gas operations. Something that should interest any company or person looking to enhance their performance. That the business model of the Preliminary Specification addresses specifically the issue in the marketplace today and is a workable solution doesn’t gain any traction with the bureaucrats. That I have difficulty selling profitability to these people should be of grave concern to the oil and gas investor. The bureaucrats are more interested in their personal franchise than they are in the business. They have taken the business to the level that it is today. Where it is now the biggest crisis since the financial crisis. And all they can do is suggest we’ll muddle along and do nothing. That this is somehow acceptable to them after filing quarterly and annual reports that show the level of devastation has been nuclear within their organizations?

Our value proposition falls within the range of $25.7 to $45.7 trillion over the next 25 years. It should be clear to everyone how that money would be earned through our price maker strategy. And all I hear from the bureaucrats is the pounding of baseball bats against my backside. It will be interesting to see where the credibility is given in the industry in these next six months. I have bored my audience to tears trying to convince others to institute these changes. And bureaucrats have done nothing but burn the place down. Who’s going to have the credibility to approach what has to be the new oil and gas industry. The one that we build from these ashes. It’s going to be an interesting few months.

The Preliminary Specification and user community provides the oil and gas producer with the most dynamic, innovative, profitable and successful means of oil and gas operations. People, Ideas & Objects Revenue Model specifies the means in which investors can participate in these user defined software developments. Users are welcome to join me here. Together we can begin to meet the future demands for energy. And don’t forget to join our network on Twitter @piobiz anyone can contact me at 403-200-2302 or email here. 

Economics 101

In addition to the accounting issue we discussed yesterday. Oil and gas bureaucrats have misinterpreted an important element of their commodities economic behavior. They have assumed that the oil and gas commodities are subject to the principles of “price taker” when in fact they exhibit the classic behavior of “price makers.” Once again, the culture of the industry has developed over the years based on this misinterpretation and created the situation that we have today. That being of systemic destruction of the industry.

The culture is to produce. Investors are rewarded with higher stock prices based on higher deliverability. Production profile increases are rewarded with handsome, leveraged, increases in the stock price of the firm. Bureaucrats have caught on to this and have based their compensation on the performance of the stock of the producer. The more lucrative action in terms of stock price increases comes from projected production profile increases. As long as the firm can meet its targets, either through acquisition or drilling, the stock price will increase ever higher. The derivative of this thinking is that the commodities are scarce and there will always be a market for the products. That it’s beyond the producer's control to affect prices in any manner. Which is the case for most producers other than the majors.

In the past decades the investors saw that this was being achieved and reported in a profitable manner by the bureaucrats. Therefore they continued to encourage their bureaucrats to seek higher production profiles to gain more value in the stock. The investors were asked for the investment necessary to achieve these gains and the game went on and on. No one has stopped to ask why it is that every oil and gas company needs to issue stock or access their line of credit each year. This is not common in most industries, why is it the case in oil and gas? Certainly it’s a capital intensive industry but the amount raised each year only grows. Where does all this money go? Does the business ever generate its own capital? And do the investors see any of this money in terms of a quarterly or annual dividend? Or is this just “a build the company and exit” strategy? And not really the oil and gas business. Or, is it something else? We’ll discuss this “something else” tomorrow.

People, Ideas & Objects Preliminary Specification changes the economic basis in which the oil and gas commodities are produced. We provide the oil and gas producer with the most profitable means of oil and gas operations. And we do that by instituting production discipline across the industry by ensuring that every producer adheres to the principle that only profitable properties are produced. Which within our system is in their best interests to do so. And as we’ve noted, the Preliminary Specification uses the Joint Operating Committee as the key organizational construct of the dynamic, innovative, accountable and profitable oil and gas producer. It is in this way the producer will know that all of their reserves will be produced profitably. That none of the oil and gas reserves will have any financial losses added on top of the capital costs that have been incurred on that property. And that their profitable operations will no longer be diluted by any of their other unprofitable properties. And the commodity markets will find the marginal cost as only profitable production is being produced by the industry. It is People, Ideas & Objects price maker strategy that enables these benefits to occur based on the producers independent decisions, based on a factual accounting, as to whether or not a Joint Operating Committee is profitable.

We do this bit of magic by changing the structure of the industry and of the producer itself. The producer is stripped down to the C class executives, earth science and engineering resources, landmen, legal and some support staff. The remaining administrative and accounting resources are reallocated to service providers which are discussed below. The producer is then able to focus exclusively on their earth science and engineering capabilities, and their land and asset base as their key competitive advantages.

The industry is restructured by taking the administrative and accounting resources from the producers and reallocating them to the service providers based on specific individual processes and sub-processes. Each service provider will specialize on that process that they have exclusive rights to within the North American oil and gas industry. Some consideration for some processes are necessary, such as production accounting related processes. When a property incurs an activity (production), that will be communicated to the service providers through our task and transfer network which will trigger their work on that property for that process. The service provider will then complete that process and bill that Joint Operating Committee for that service for that month.

The price maker capability comes into play when the property is determined, based on an actual detailed accounting, not to have produced a profit and as a result is shut-in. And as a result of being shut-in, none of the service providers will be reported any activity in our task and transfer network for that Joint Operating Committee. And subsequently no processes will be incurred and no billings will be sent for any of the administrative or accounting service providers to that property. The property ends up recording a null operation, no profit but also no loss. Enabling the producer to achieve the most profitable means of oil and gas operations.

The Preliminary Specification and user community provides the oil and gas producer with the most dynamic, innovative, profitable and successful means of oil and gas operations. People, Ideas & Objects Revenue Model specifies the means in which investors can participate in these user defined software developments. Users are welcome to join me here. Together we can begin to meet the future demands for energy. And don’t forget to join our network on Twitter @piobiz anyone can contact me at 403-200-2302 or email here.