A sustainable future for the UKCS (UK Continental Shelf) will be met through ardent co-operation across the UK oil and gas industry.
This was the message heard by delegates at an Oil & Gas UK briefing in London.
Drawing on the experience of others in helping to contain inflationary pressures was also marked as a key solution in helping the industry.
Stephen Marcos Jones, Oil & Gas UK’s business development director and chair of the event, said:“While the tax reforms announced in the Government’s 2015 Budget and the establishment of the new regulator, the Oil and Gas Authority, will take effect over time, Oil & Gas UK estimates that efficiency improvements of 30 to 40 per cent need to be made by 2020 to put the basin back on a healthy footing.
“Companies are having to make tough decisions on their capacity during the downturn and are individually taking measures to improve efficiency. However, co-operative working across the industry and drawing on the measures that have yielded success in other sectors and countries can also help deliver the cost and efficiency improvements required to secure a long-term future for the UKCS.”
In addition to the range of pan-industry projects revealed earlier this month, the Oil and Gas Industry Council has commissioned PwC to study the measures taken by other industries to improve efficiency.
Through interviews and research, the ‘Cross-Sector Efficiency Study’ aims to identify characteristics that drive efficiency in high performing sectors, namely aerospace, automotive, chemicals and rail, and propose tangible practices that can be transferred to oil and gas industry operations.
The results will be presented in June at Oil & Gas UK’s annual conference.
Alastair Geddes, oil and gas consulting specialist, PwC said: “In last year’s Northern Lights report we noted that the oil and gas industry lagged behind leading supply chain management practices in other relevant sectors, such as process, extractive and engineering industries, by around ten years, and concluded that with more effective management, costs could be reduced by 10 per cent and profitability boosted by as much as £3 billion. But in terms of cross-industry best practice, this just scratched the surface.
“We’ve a long history of working closely with heavy-industry companies across a range of industries, helping them to respond to severe cost and service pressures by undertaking fundamental change.
“While there are many unique factors about the UK oil and gas industry, we believe this study will enable us to draw wider parallels and identify a number of practical lessons. For those leaders who are open to change, incorporating proven, best practice approaches could net significant long term business benefits.”