Research On Cost Control Of The Production System Of Changchun Oil Production Company Of Jilin Oilfield

Making profit is the ultimate goal of enterprise production with the operationalproduction process being the source for realizing values and making profits. To maintainsustainability of an enterprise, adoption of modern management becomes indispensable,which involves not only the increase of production and enhancement of product quality, butalso reduction of production cost through managerial means. One of the most importantaspects of modern management of financial system is how to execute effective control ofproduction cost. Though significant progress has been made, much remains to be done inthe research in the production cost control in petroleum industry. Oil production system isan important component of the oilfield production and also a major consideration if theoverall production cost is to be reduced. The cost structure of the system varies with thedifferent stages of the production, and toward the mid and later stages of production, costcontrol becomes increasingly difficult as the cost structure changes drastically withdecrease in production and increase in the cost of maintenance. How to more effectivelycontrol the cost structure, the variables responsible for such changes, and more importantly,how to adopt modern managerial systems to control the production cost and increase theefficiency of production operation, and ultimately to maximize profit becomes criticallyimportant to the development of petroleum industry.With many years of working experience at the production facility of Changchun OilProduction Company associated with Jilin Oilfield, the author has observed many areaswhere improvements can be made to significantly reduce the production costs. Theseinclude1) the lack of systemicity in cost control, which leads to off-target strategies,missing links, and eventually, our limited current ability in cost control;2) lack ofunderstanding of the dynamics of the factors underlying effective cost control and poorability to cope with constantly changing situations；and3) advanced technological meansnot making contributions to the management of cost control, which leads to highproduction costs, high consumption costs, and low efficiency of the enterprise.This project aims at searching for new ways toward better cost control of the oilproduction system. With the research object being the oil production system atChangchun Oil Production Company of Jilin Oilfield and building on the combination oftheoretical guidance and practical experience, the author has conducted thorough analysisof the key aspects, dynamics, control methods, and management of production costs, theauthor wishes to identify more effective management systems for the control of productioncost with the hopes of laying the foundation for better control of production costs,improvement of management ability, and enhancement sustainability of the enterprise.