98% of oil and gas companies recognise that collaboration is crucial to future success

Stephen Marcos Jones
Stephen Marcos Jones, Director of Business Excellence, Oil & Gas UK

A new survey by Oil & Gas UK and Deloitte has shown that 98% of oil and gas operators and suppliers believe that collaboration is “crucial” to their future success.

The ‘UKCS upstream supply chain collaboration survey’ asked British and Dutch operators and suppliers about their experiences working alongside other companies in the North Sea. It showed the the UK Government’s Maximising Economic Recovery strategy is having an effect, with 86% of respondents said that they see collaboration as an integral part of their everyday business – a 12 per cent increase on the previous year.

Stephen Marcos Jones, Director of Business Excellence, Oil & Gas UK, said: “Whilst it’s encouraging to see that the industry is now really on board with the importance of collaboration, we have just cleared the first hurdle and there is much more work for us to do.

“To see truly sustainable change, we need to look beyond collaboration to cut costs towards projects driven by innovation, knowledge sharing, and a desire to work smarter and more efficiently.

“Oil & Gas UK’s Efficiency Task Force will continue to support industry collaboration through initiatives such as the Subsea Technology Project to standardise specifications and the development of the Tendering Efficiency Framework to simplify and reduce duplication in the procurement process. The task force also promotes the use of change enablers such as the Industry Behaviour Charter, the Rapid Efficiency Exchange to share case studies and challenges, as well as the continuous improvement network. Our hope is that future surveys will show further improvements across the sector as a result of these collective efforts.”

The survey also found:

  • Both operators and suppliers reported higher levels of successful collaborations than the previous year: 40% of respondents were satisfied with the quality of collaboration compared with 27% last year.
  • Cost reduction remains the main reason for collaboration: 32% stated that they collaborated to reduce costs
  • Collaboration between Dutch operators and suppliers is focused on optimising capabilities (29%), whereas in the UKCS operators collaborate to reduce costs (36%).
  • The collaboration Index score has improved from 6.1 out of a possible 10 in 2015 to 6.6 in 2016. This shows the efforts invested both by the operators and the suppliers to strengthen relationships.

Bevan Whitehead, Oil & Gas Leader, Deloitte, said: “The results of our latest survey suggest that the industry has taken a considerable step forward toward improving supply chain collaboration in the past 12 months. A huge opportunity for real transformation remains, if companies can take the next step and embrace radical changes in how they work together to build efficient, sustainable and long-term businesses in the UKCS.

“There are many examples of successful collaboration in the UKCS and the Netherlands from which to build. With a world-class supplier base in place, the change the industry needs depends on strong leadership and a willingness to take action.”

The survey is the third in a series of surveys carried out by Deloitte to gauge the effectiveness of industry efforts, supported by Oil & Gas UK’s Efficiency Task Force (ETF), to improve cross-industry collaboration.

Last year the Efficiency Task Force released the Industry Behaviours Charter to encourage a collective commitment from the offshore oil and gas industry to work more efficiently and co-operatively.

Pixie Energy

Pixie logo Pixie Energy is an incubator and a facilitator of strategic research and project work, focusing on energy regulation, policy and markets at the local and national level. Find out more about Pixie Energy here.

Local Energy Matters: Scotland

Local Energy Matters: Scotland is a free-to-download brochure with a focus on energy tariffs in the two Scottish electricity distribution regions, as well news on local energy and low-carbon schemes.

Previous editions can be download here.

Scottish energy market overview

You can read an overview of the Scottish energy market here.

Scottish Government energy feed