Tuesday 22 March 2016

The Efficiency Task Force (ETF) – a group set up to drive a pan-industry improvement in efficiency – is today announcing the launch of a trial which sees five operators share 200,000 inventory items on an online trading platform. The aim is that by allowing access to a greater ‘virtual’ pool of resources, companies can reduce individual stock holdings and cut lead times for access to vital equipment.

Operator companies Apache North Sea, Centrica, EnQuest, Shell Upstream International and Talisman Sinopec Energy UK Limited have come together to trade their sizeable inventories in the hope of reducing the cost associated with the storage and maintenance of materials.

After a rigorous tender process, the ETF began work with Ampelius Trading on an online trading platform. Companies have been preparing details of their inventories since autumn 2015 and today (Monday 21 March) sees the launch of some 200,000 items of varying value on the trading platform.

Stephen Marcos Jones, Oil & Gas UK’s business development director, commented:

“Improving efficiency through inventory management is potentially a real source of cost saving on the UKCS, as well as providing an opportunity to reduce the loss of offshore production that comes from required equipment not being immediately available when it’s needed.

“This is a great example of companies are working smarter – together – to ensure we make the most of our operations in the North Sea.

“In practice, if an operator doesn’t have a specific valve in stock, they’ll be able to access exactly what they need from a company down the road with surplus – rather than ordering a new part to be manufactured. That seems like a more efficient way to operate.”

Andy Taylor, Managing Director, Ampelius Trading commented on the project:

“Ampelius are delighted to be working with Oil & Gas UK and the members of the ETF to bring about real change to industry in the North Sea.

“It has been estimated that power companies could save 15–20 per cent of their annual non-fuel procurement costs by adopting innovative procurement and inventory trading initiatives, we are confident that Ampelius is well placed to deliver similar efficiencies and cost savings for the offshore oil and gas industry.”

The project has been run by experts in O&G materials and inventory management for the benefit of the wider sector. Scott Benzie, Materials and Inventory Lead for Talisman Sinopec Energy UK Limited added:

“Industry has recognised and addressed the need to improve its efficiency in materials and inventory management. Action in this space provides us with a real opportunity to progress tangible collaboration, positively influence costs and support our businesses to become more competitive within the current and future environment.

“We are happy to be part of this trial project which offers the opportunity to access items at short notice, reduce costs, reduce levels of redundant and surplus materials and inventory held by industry and potentially also to monetise these items.”

The next phase of the project will build upon the implementation of the trading platform. An assessment of the opportunity to pool specific high-value items across companies–is underway and RB211 turbines have been proposed as a test subject.

Stephen Marcos Jones added:

“The overarching ambition of the ETF is for as many companies and individuals across the basin to get involved in these initiatives so that this industry becomes as competitive as it possibly can be in the global marketplace and ready to take advantage of the oil price upturn when it happens.”

Source: Oil and Gas UK