N. Sea industry clears ‘first hurdle’ in MER oil and gas collaboration race

mer-conference-short-logoThe N. Sea oil and gas sector has ‘cleared the first hurdle’ in its drive for better collaboration but there is still more work to be done, according to a new industry survey published 18 months after the first MER UK Collaboration Conference was held by Aberdeen University and Scottish Energy News.

In the new survey, 98% of oil and gas companies recognise that ‘collaboration is crucial to future success’, while 90% agree that ‘collaboration is an integral part of day to day business’.

The UKCS upstream supply chain collaboration survey also asked British and Dutch operators and suppliers about their experiences working alongside other companies operating in the North Sea.

In a signal that the objectives of the Maximising Economic Recovery (MER) strategy are starting to be met, nearly nine out of ten (86%) of respondents said that they see collaboration as an integral part of their everyday business – a 12% increase on the previous year. Nearly all (98%) see collaboration as ‘crucial’ to their future success.

The survey also found that both operators and suppliers reported higher levels of successful collaborations than the previous year – 40% of respondents compared with 27% last year – and cost reduction remains the main reason (32%) for collaboration.

mer-n-sea-collaboration-norwegian-styleCollaboration 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.  

A spokesman for 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.”

Bevan Whitehead, Oil & Gas Leader at survey co-organiser Deloitte said: “While 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.

“There are many examples of successful collaboration in the Dutch and British North Sea 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.”

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