JIB statements can be several pages long and must be mailed to all working interest partners. It takes extreme attention to detail to review, print and mail JIBS to their rightful partners. In order to prepare a joint venture billing, an oil and gas accountant must refer to the original operating agreement signed by all parties.
Joint Interest Billing (JIB) is a critical accounting process in the oil and gas industry. It involves the distribution of expenses among multiple working interest owners in a joint venture. Given the complexity of operations and the involvement of multiple stakeholders, JIB ensures that each party is billed accurately for their share of the operational costs.
Oil and Gas Data
You will work hard when you get involved, but the experiences, people and benefits will be worth it. This task is made somewhat easier by making use of a software system that has been specifically customized to be used with oil and gas applications. Inconsistencies will be identified and pointed out by the software, making the accountant’s job much easier. All content on this website, including dictionary, thesaurus, literature, geography, and other reference data is for informational purposes only.
Because the industry can be high risk, high reward, it’s common for different parties to invest in a single drilling project. Shareholders within the joint venture have different responsibilities and privileges. A JIB statement divides the expenses and revenue from a drilling project among the partners, based on the agreement in place.
The difference in allocation vs vertical wells
This requires additional focus from oil and gas operators to control capital expenditures. The rapid pace of drilling activities makes timely reports and analyses essential to controlling costs. AFE management plays a critical role in controlling risk and containing of expenditures. P2’s AFE workflow application aids in tracking the AFE approval process and provides reports and dashboards to compare budget versus actual charges as they are incurred. Oil and gas firms must be confident in accounting for suspended revenues and expenses, and reporting and payment of unclaimed property. Fractional ownership management has grown more complex with increased scrutiny from regulatory agencies.
- Operators process JIBs each month as part of their accounts payable workflow.
- P2 BOLO processes more transactions every day than most other upstream software providers process each year.
- The operator performs the drilling of a site, receives the initial profits from the project and manages the upfront expenses.
- AFE cost estimates help to monitor costs that arise during development and provides good visibility into how accurate estimates were, as well as how close actual costs were to those estimates.
- Joint Interest Billing, or JIB, is a form of accounting specific to the oil and gas industry.
- In the oilfield services space, not every company is well equipped for international growth.
P2’s accounting software helps upstream oil and gas companies achieve greater value from increasingly complex assets. Our solutions are tailored to your company’s size, location, and business needs. Whether you’re a small startup, a large super major, or of any size in between, P2 can put the right tools in your hands to tackle evolving industry challenges. Are you located in the United States, Canada, or operating on a global scale?
Words that may be confused with jib
Due to the high costs and risks involved in an oil-drilling project, it is common for several parties to come together in a joint venture that designates separate responsibilities and privileges. A joint interest billing oil and gas accounting statement divides the revenues and expenses from an oil project among its partners according to their standing agreement. Joint Interest Billing, or JIB, is a form of accounting specific to the oil and gas industry.