Sap Iog100 v097

IOG100Primary & Secondary Distribution

with SAP for OilSAP for Industries - SAP for Oil and Gas

Date

Training Center

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Education Website

Participant HandbookCourse Version: 97Course Duration: 5 Day(s)Material Number: 50110680

An SAP course - use it to learn, reference it for work

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Copyright © 2012 SAP AG. All rights reserved.

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About This HandbookThis handbook is intended to complement the instructor-led presentation of thiscourse, and serve as a source of reference. It is not suitable for self-study.

Typographic ConventionsAmerican English is the standard used in this handbook. The following typographicconventions are also used.

Type Style Description

Example text Words or characters that appear on the screen. Theseinclude field names, screen titles, pushbuttons as well asmenu names, paths, and options.

Also used for cross-references to other documentationboth internal and external.

Example text Emphasized words or phrases in body text, titles ofgraphics, and tables

EXAMPLE TEXT Names of elements in the system. These include reportnames, program names, transaction codes, table names,and individual key words of a programming language,when surrounded by body text, for example SELECTand INCLUDE.

Example text Screen output. This includes file and directory namesand their paths, messages, names of variables andparameters, and passages of the source text of a program.

Example text Exact user entry. These are words and characters thatyou enter in the system exactly as they appear in thedocumentation.

<Example text> Variable user entry. Pointed brackets indicate that youreplace these words and characters with appropriateentries.

2012 © 2012 SAP AG. All rights reserved. v

About This Handbook IOG100

Icons in Body TextThe following icons are used in this handbook.

Icon Meaning

For more information, tips, or background

Note or further explanation of previous point

Exception or caution

Procedures

Indicates that the item is displayed in the instructor’spresentation.

vi © 2012 SAP AG. All rights reserved. 2012

ContentsCourse Overview ...............................................................................x

Course Goals.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xCourse Objectives ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . x

Unit 1: Oil Company Structure and Logistics............................................1Enterprise structures and Logistics.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

Unit 2: Physical Oil and Gas Commodity Trading .................................... 33Global Trade Management .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

Unit 3: International Export/Import Operations........................................ 85Contract Operations and Bulk Schedule Management .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87Vehicle Concept and Freight Contract .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112Bulk Operational Inventory Management .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .136

Unit 4: Bulk Supply Chain Management (Inbound Distribution)..................173Bulk Pipeline Scheduling and Movement Execution ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . .174

Unit 5: Refinery: Silo Management, Refining, Internal Movements..............237Hydrocarbon Inventory and Tank Management .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .239Refinery processing ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .282Reporting ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .316

Unit 6: Exchange Agreements............................................................331Exchange Operations ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .332

Unit 7: Secondary Distribution ...........................................................377Transportation and Shipment Costing ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .379

Unit 8: Service Station Retailing .........................................................435Service Station Fuel Management .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .437Service Station Retailing... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .468Meter and Dip Reading Management.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .496Payment Cards and Service Station Partner Invoicing ... . . . . . . . . . . . . . . . . . . . . . . . . . . . .541

2012 © 2012 SAP AG. All rights reserved. vii

Contents IOG100

Unit 9: Analytics with SAP Business Intelligence ...................................591Bulk Supply Chain Reporting and Analytics.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .592

viii © 2012 SAP AG. All rights reserved. 2012

Course OverviewThis course will provide an instructional overview of the processes Supply, Refineryand Trading, organizational structures, master data and reports that support thebasic processes in Oil and Gas industry. Throughout this course, you will have theopportunity to enhance your skills in system functions by completing exercises at theend of each lesson. The exercises are based on the requirements of the case companies,an International company and a Local affiliate company, which are completing SAPfor Oil&Gas implementation. You will join the implementation team as a businessanalyst. The exercises will therefore ask you to check, test and analyze various aspectsof the industry supply chain and refinery processes. Have fun in your new position!

The first unit gives you a brief overview of the organization structures in SAP that arerelevant to build up Oil company structures in the system.

The second unit deals with functions within Physical Oil and Gas CommodityTrading, such as deal capture, trade management and trading commodity pricing.

The third unit covers business scenario International Export/Import Operations (rawmaterial). You become acquainted with processing of supply contracts in sales andpurchasing cycles. Next step is Bulk scheduling and operation which is performed viaTransportation and Scheduling Workbench (TSW) and considers voyage scheduling,nomination and ticket processing. The scenario also covers Quantity ConversionInterface (QCI) and interaction between Materials Management and operations inTSW. Freight management part includes basics of Transportation and Distribution(TD)

The fourth unit describes scenario Bulk Supply Chain Management (InboundDistribution). The steps of the scenario covers bulk pipeline scheduling, TSW masterdata and operational inventory management.

The fifth unit describes silo management, refining, internal movements. The scenariogoes trough Hydrocarbon Inventory Management (HPM) to Refinery processingand Reporting of internal movements.

The sixth unit covers business scenarios of exchange business and operations withfinished products. Within exchange business the scenario includes, master data,agreements, operations management and settlement.

The seventh unit describes secondary distribution of finished products and coversthe whole range of functions in Transportation and Distribution (TD): basics, masterdata of transportation units, shipment scheduling, loading and discharging, shipmentcosts calculation and settlement.

2012 © 2012 SAP AG. All rights reserved. ix

Course Overview IOG100

The eighth unit is about processes based on service station retailing. It contains fuelpricing, fuel stock management, tank management, payment settlement (paymentcard, cash, fuel card) and dealer settlement

The ninth unit consists of Reporting and Analytics for bulk supply chain. It isdescribed how to retrieve and analyze relevant for supply, refinery and tradinginformation using various reporting tools

Target AudienceThis course is intended for the following audiences:

• Members of the project team• Consultants

Course PrerequisitesRequired Knowledge

• TIOG10 Oil&Gas Business Processes and Organization

Recommended Knowledge

• SCM500 or comparable knowledge in the area of Processes in ExternalProcurement

• SCM600 or comparable knowledge in the area of Processes in Sales andDistribution

• SCM601 Processes in Logistics Execution

Course GoalsThis course will prepare you to:

• Recognize and execute the basic processes within SAP for OIL&GAS in variousbusiness scenarios. Gain conceptual information and hands-on experience ofSAP for OIL&GAS

• Understand and maintain the master data used in the basic processes• Recognize and understand the interaction between modules involved in business

scenarios.• Gain understanding on application area of SAP for OIL&GAS functions (the

course does not cover customizing of the system).

x © 2012 SAP AG. All rights reserved. 2012

IOG100 Course Overview

Course ObjectivesAfter completing this course, you will be able to:

• Explain the realization in SAP for OIL&GAS basic functions of Supply,Transmission & Trading and Refining.

• Understand the purpose and assignment of enterprise structures required forprocessing documents

• Create and process the documents used in the various industry business scenarios.• Create and maintain all relevant master data.• Execute and change layout of basic reports and lists relevant to business

scenarios.

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Course Overview IOG100

xii © 2012 SAP AG. All rights reserved. 2012

Unit 1Oil Company Structure and Logistics

Unit OverviewThis unit gives brief overview of the typical structure and organizational levels ofInternational Oil Company. At the organizational level of Local Oil Company thestructure of Supply & Distribution Department is carefully explained. The unitdescribes organization elements (units) and master data used in the modeling processof company structure using standpoint of Primary and Secondary Distribution withSAP for Oil&Gas.

Unit ObjectivesAfter completing this unit, you will be able to:

• Explain the structure and organizational levels within an international oilcompany

• Explain the logistics and supply chain in a local oil company• Name the organizational elements in the logistics process• Define the enterprise structures in SAP for Oil&Gas

Unit ContentsLesson: Enterprise structures and Logistics .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

Exercise 1: Enterprise Structures in SAP for Oil & Gas ... . . . . . . . . . . . . . . . . . 23

2012 © 2012 SAP AG. All rights reserved. 1

Unit 1: Oil Company Structure and Logistics IOG100

Lesson: Enterprise structures and Logistics

Lesson OverviewThis lesson will explain structure and organizational levels within an internationaloil company. You will study the organization elements and master data used in themodeling process of a company structure. The lesson also gives you information onthe relationship between organizational elements and master data in logistics.

Lesson ObjectivesAfter completing this lesson, you will be able to:

• Explain the structure and organizational levels within an international oilcompany

• Explain the logistics and supply chain in a local oil company• Name the organizational elements in the logistics process• Define the enterprise structures in SAP for Oil&Gas

Business ExampleOne of the initial steps of an implementation project is modeling the company’sorganizational structure. The project team has to build up the organizational structureand master data in an international oil company and the German oil company VOILDE in compliance with SAP for Oil&Gas Primary and Secondary Distribution.

Supply Chain OrganizationsOrganization varies by company and within a company structure, supply chainmanagement (SCM) may be referred to as supply, refining & supply, supply &distribution, or refining & marketing, depending on the department.

Here we willl use the term supply & distribution (S&D) for the department with themajor supply chain management process that covers crude, feed stocks, semi-finishedproducts (blend stocks and rerun products), and – in terms of production anddistribution – finished products. Supply & distribution usually needs the full scopeof SCM.


IOG100 Lesson: Enterprise structures and Logistics

Figure 1: S & D in an International Oil Company

In most oil companies, SCM is also applicable within individual departments forspecific product lines, such as liquefied petroleum gas (LPG); lubes (including orexcluding base oil); jet fuels (aviation gasoline, kerosene, and lubes); asphalt (regularor oxidized); or coke (regular or calcinate). There may be also SCM for specificcustomers handled by individual departments, including industrial and wholesalecustomers (usually heating oil, diesel, or heavy fuel oil) or marine (diesel, bunker fuel,or lubes). The scope of SCM within these departments varies according to specificbusiness requirements.

There may be interactions, for example, Aviation and Marine just sell and S&D andLubes provide the products. Here there is a shared SCM process. In many companies,Aviation and Marine are organized globally with their own global sales systems.Companies may decide to interface these systems to capture local movements andinventory in SAP. Billing may be captured as well, that is, accounting is handled inSAP, and order taking and scheduling are outside of SAP.

Subdivisions in a Typical S&D DepartmentA typical S&D department is divided into business units.

Planning and optimization



This unit is responsible for the different planning cycles (yearly, monthly, and weeklyfor day-to-day business; long-term for strategic decisions). It may include planningoptimization but usually only partially, for example, refinery production or lubesblending. This business unit could also be responsible for product exchange and termcontract (purchase and sale) economics. Guidance is given on inventory handling,minimum/maximum, and targets.

Trading

Trading is responsible for purchases and sales as per planning signals, using termcontracts plus necessary spot deals to balance. Depending on the company philosophy,third-party trading is used to optimize, with or without hedging to secure wet deals.Usually, there is also a close link to upstream for production trading, that is, salesof surplus production or sale and purchase to optimize supplies (for example, tominimize transportation costs).

Scheduling

Scheduling handles daily operations within planning cycles (usually weekly andmonthly cycles). This includes tanker, barge, rail, truck, and pipeline programmingfor crude, feed stocks, semi-finished products, base oil transfers, purchases, and sales(primary distribution). The resulting slates (basically shopping lists) bridge tradingand transportation, that is, they are the basis for all nominations to suppliers (orvendors), customers, terminals, inspection companies, and so on.



Figure 2: S & D Departments and Responsibilities

Transportation

Transportation is responsible for negotiation of transportation term contracts tocover basic transportation requirements. This covers programming of availabletransportation units based on slates from scheduling; in (or out) chartering of capacityto balance coverage; safety and environmental issues; and vessel screening (ship, crewsafety status, technical condition, and ship safety record).

Terminal Operations (including refinery distribution terminals)

Terminal operations handles coordination of loading and discharging of differenttransportation units (berth/loading rack scheduling). Terminal maintenance includestanks, racks, berths, pipes, gauging systems, and so on. Terminal operations is alsoresponsible for posting of issues and receipts and physical inventory measurements,and gain/loss management.

Administration

Administration is responsible for term and spot contract administration (purchase,sale, exchange); claim handling (contract pricing, product gain/loss, demurrage ); andinventory management (reconciliation and physical inventory adjustments).

Note: Inventory management may be handled by controllers rather then S&D.This is a common Change Management issue in SAP implementations.



The same structure is applicable (either fully or partially) to other departments, suchas Lubes or industrial and wholesale customers.

S&D Busines PartnersThe supply & distribution department interacts daily with business partnersrepresented by internal and external parties.

External: Third Party

Crude oil supplier, location Saudi Arabia, DharanCrude oil supplier, location UK, LondonCrude oil, Feed stocks trader, location Switzerland, GenevaExchange partner, location Germany, HamburgCargo inspector, internationalShipping agent, internationalForwarding agent, internationalSupply sales customer, location Germany, FrankfurtSupply sales customer, location Czechia, PragueCrude pipeline operator, location Triest (terminal) and Munich (headquarter)Product pipeline operator, location Frankfurt

External: Own International Company (but different entities)

Other affiliate, location Netherlands, RotterdamOther affiliate, location Switzerland, ZurichGlobal Crude Trading, location United States, HoustonRegional Product & Feed Stock Trading, location Belgium, Brussels

Internal: Own Local Company (transfer pricing)

S&D – Refining (crude feed stocks)Refining – S&D (finished and semi-finished products)S&D – Fuels Marketing (finished products)



Figure 3: S & D Interaction



SCM Logistics Example for the S&D BusinessOrganizationThe logistics organization of primary and secondary distribution in German Oilcontains organizational units allocated in Europe. Following the supply chain of crudeoil into the refinery via a pipeline, and oil products out of the refinery via differentmeans of transportation, the supply & distribution department has to monitor logisticoperations as follows:

• Multiple crude or feed stocks purchasing terminals (1)

– International locations operated by supplier (or vendor) or third party• Crude terminal (pipeline head) Triest (2)

– International (on coast) location– Joint venture operated by third party (pipeline operator)– Joint storage for all shippers, that is, by grade, not by ownership– Receipt and storage of crude and feed stocks on behalf of shippers.

• Crude pipeline Triest – Ingolstadt (3)

– Movement of crude and feed stocks from crude terminal to refinery (acrossborder).

– Joint venture operation with third-party pipeline operator• Refinery Ingolstadt (represented as terminal) (4)

– Domestic (off coast) location operated by S&D. This terminal is notidentical with the refinery distribution terminal. The distribution terminalreceives the products listed under output from the refinery.

– Input into the refinery: crude and feed stocks (condensate, naphtha,distillate, vacuum gas oil, atmospheric residue)

– Output from the refinery: gas, semi-finished products (naphtha, vacuumgas oil, atmospheric residue, base oil, solvents), and finished products(LPG, gasoline, distillate, fuel oil, asphalt, coke)



Figure 4: Primary and Secondary Distribution in VOIL DE

• Refinery distribution terminal Ingolstadt (5)

– Domestic location operated by S&D– Truck, rail, barge, and product pipeline operations– Discharge of feed stocks for the refinery and, in exceptional cases (refinery

turnarounds) receipt of finished products– Loading of finished and semi-finished products– Pick up of finished products with partner additive package (partner brand)

by two exchange partners• Distribution terminal airport Frankfurt (6.1)

– Domestic location operated by third party– Finished products (jet fuels) supplied through product pipeline (third-party

operator) from refinery distribution terminal– Own stocks in third-party consignment

• Distribution terminal Dresden (6.2)

– Domestic location operated by S&D– Finished products supplied by rail (third-party operator) from the refinery

distribution terminal



– Terminal Automation System (TAS) and automated load data transmission• Distribution terminal Hamburg (7)

– Domestic location, joint venture, operated by third party– Physical inventory for both exchange partners (no own inventory)– Pick up of finished products with own additive package (own brand) by

own customers, and stock transfers of finished (non-additive) product toterminal B

– Allocation of lifted volume as per exchange agreements with the twoexchange partners

– Terminal Automation System (TAS) and automated load data transmission• Import terminal Rotterdam (8)

– International (on coast) location– Purchasing point for feed stocks and finished products– Discharge into rented tanks or board-to-board (tanker to barge)– Delivered sales cross-border to domestic customers (rail, barge)– Stock transfers cross-border to domestic terminals (rail, barge)

• Distribution terminal Köln (9)

– Domestic location operated by S&D– Finished products supplied by barge (own fleet, third-party fleet) from

import terminal Rotterdam– TAS and automated load data transmission

Organizational Elements in the Logistics ProcessOrganizational elements are structures that represent the legal or organizational viewsof an enterprise. You can design your company structure based on your businessprocesses. Defining organizational levels is an essential step in your project and isvital for all subsequent activities.

Analyze the organizational structures and process structures in your company andmatch them with SAP structures. Once you have decided on an organizationalstructure, it is very difficult to change it.



Figure 5: Organizational Elements in the Logistics Process

Each client contains its own organization elements, master records, and set of tables.SAP systems use the client concept to allow legally and financially independententities to coexist in a system. Clients are part of the defining technical structure of theSAP system. From a business perspective, the client forms a corporate group. Systemtransactions provide special functions for working with clients.

Note: Client names are always numeric.



The procurement process uses the following organizational elements:

• As the smallest organizational unit in external accounting, the company coderepresents an independent accounting unit. This includes entry of all accountabletransactions and the creation of all proofs for a legally required individualaccount closing. Documents such as balance sheets and profit and loss statementsare created at company code level.

An examples of a company code might be a company within a corporate groupor a subsidiary.

• The plant is an organizational element within a company.

Materials management is primarily concerned with the flow of materials. Froma materials management point of view, a plant is, above all, a location wherematerial stock is kept. A plant can be a manufacturing facility or a warehousedistribution center.

In production, a plant can represent a manufacturing facility. In sales anddistribution, a plant represents the location from which materials and servicesare distributed and corresponds to a distribution center. The relevant stocks arekept here. A plant can, for example, represent a grouping of storage locations inphysical proximity. If you sell a service, a plant can represent the location fromwhich services are rendered (such as an office).

A plant must be uniquely assigned to a company code. The assignment betweensales organizations and plants does not have to be unique. The plant is essentialfor determining the shipping point.

• The storage location allows the differentiation of material stocks within a plant.Inventory management on a quantity basis is carried out at storage location levelin the plant. Physical inventory is carried out at storage location level.

Plant and storage location are organizational units that can be used by all logisticareas.



Figure 6: Organizational Elements in Procurement and Inventory Management

The purchasing organization is responsible for the enterprise’s purchasingrequirements. This unit is structured to negotiate the general conditions of purchasefor one or more plants or companies. Pricing conditions are set at the purchasingorganization level. You can incorporate purchasing into the company structure byassigning the purchasing organization to company codes and plants. This means thatyou can determine whether or not purchasing is organized centrally in your company.You can distinguish between plant-specific, cross-plant, and cross-company-codepurchasing.

The purchasing group represents a buyer or a group of buyers who is responsible forcertain purchasing activities. This cannot be assigned to a purchasing organization.

The sales organization is an organizational unit in logistics that groups the enterpriseaccording to the requirements of Sales and Distribution. A sales organization isresponsible for distributing goods and services. Therefore, it is also liable forsold products and is responsible for the customers’ rights of recourse. The salesorganization is also used, for example, to take a regional, national, or internationalsubdivision of the market into account.

A sales organization is uniquely assigned to a company code. More than one salesorganization can be assigned to a company code. If you use Sales and Distribution,you need at least one sales organization. You maintain your own master data for


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