One of the first applications of Delos' clearing house technology is for natural gas shipment contracts.
What makes this industry perfect for Delos' AI technology is the complexity and difficulty to manage the contracts that underpin it. In fact, we estimate that 17-20% of staff in natural gas companies is dedicated to accounting processes.
Our platform is used to automate contracts such as:
- virtual pipeline solutions (equipment, services, natural gas shipments)
- deliveries of LNG (Liquefied Natural Gas) and CNG (Compressed Natural Gas) to end users
- shipments of RNG to pipeline operators
We help our clients reduce their contract processing workload by 20% and eliminate errors that cost their business thousands.
What is AI-powered contract-to-revenue automation?
Contract-to-revenue automation is the process of automating all tasks related to the fulfillment of a contract throughout its lifecycle. At its core, it is the process leveraging AI to gather information on shipments, delivered goods or services performed and invoicing clients the correct amounts every month. Finally, the calculated amounts can be automatically paid, in accordance with pre-arranged terms.
A correlated process is that of automated contract-to-payment, where AI is used to review and audit outside vendor invoices.
What are natural gas contracts?
By natural gas delivery contracts we mean contracts whereby a business receives natural gas shipments delivered via trucks or in ISO containers. Such deliveries are usually made to businesses that rely on natural gas for their heat and electricity.
If you think this is a niche market - think again!
Natural gas not powers the backbone of many companies that don't have access to the electrical grid or a gas pipeline. Such companies require regular shipments of natural gas (by trucks) to heat their buildings, power their machines or fuel their trucks and bus fleets.
More importantly, natural gas powers the rapidly growing AI industry.
Data centers rely on natural gas shipments for their fast deployment and continuous operation. Hence, natural gas will see huge growth in the next 4 years thanks to AI demand.
Every dollar spent on building a data center means 5-10 cents/year spent on natural gas to power it.
Data centers planned by Project Stargate, AWS, Azure, xAI, Meta and others will amount to $200-$250Bn every year over the next 5 years, spent on construction.
This means $10-25Bn annually on new natural gas.
What are the challenges of servicing natural gas contracts?
A properly constructed contract for natural gas delivery is a complex document containing many clauses and conditions:
-
Natural gas pricing components:
- Multiple price components and natural gas indexes
- Indexes vary by state and shipment date
- Multiple indexes used based on gas source location
-
Transportation pricing variables:
- Shipment distance calculations
- Origin-based pricing
- Fuel surcharges
-
Virtual pipeline solution components:
- Equipment lease terms
- Equipment servicing provisions
-
Additional fees and conditions:
- Late payment fees
- Cancellation fees
- Re-scheduling fees
- Many other clauses requiring attention
In total we have found that such contracts can contain 30-50 various fees, terms and clauses that require careful attention for billing.
Due to such variability and complexity, applying the correct prices across hundreds of shipments performed every month can be a challenging task.
How can Delos help?
Delos offers a powerful AI agent that is able to understand the details of natural gas contracts. Our Agent scans every contract, extracts its key terms and maps the pricing logic to apply the correct prices. Any gaps in the contract itself, can be complemented by employee feedback on internal company processes.
Delos solution is structured as a clearing house that can serve both you and your counterparties. By default - every vendor or client contract you upload to Delos, will be made available to your counterparties via a vendor/client portal. Your counterparties can review all information pertaining to their contracts and specific invoices.
Finally, Delos can automatically process payments for you and your counterparties.
Ready to streamline your contract processing and save on operational costs? Contact us today for a free demo and see how Delos can transform your business.