Getting to a New Transparency in Netback

Internal and external pressures are causing chief financial officers, chief operating officers and other executives at oil and gas exploration and production (E&P) companies to spotlight the way they are calculating netback pricing and royalties to the owners of the energy sources.

Executives are justifiably concerned with accuracy for their own businesses, their business partners and the regulators acting on behalf of investors. Thus the processes and mechanisms for calculating netback pricing are under a new scrutiny that could ultimately improve the netback pricing regimen. A centralized approach is needed to insure that firms get to the new transparency they need for making correct calculations.