Oil and gas industry needs better collaboration to maximise energy transition, report states
A collaborative commercial model is set to be a key element to face the coming challenges within the oil and gas industry.
Collaboration within the offshore oil and gas industry will be key to maximising the energy transition opportunities and boosting the potential of its current supply chain.
According to the findings of the annual Deloitte and OGUK Collaboration Report, improving commercial models which support cost reduction whilst incentivising the supply chain could re-energise collaboration.
The Deloitte and OGUK’s Collaboration Index (CI), which is part of the annual UKCS upstream supply chain survey found a slight increase in the collaboration index to 7.1 in 2020 from 7.0 in 2019, highlighting the flexibility and support the supply chain showed during the pandemic.
Collaboration success rates hit a record high in 2020 with more than 50% of survey respondents saying over half of their efforts were successful.
However, while COVID-19 saw many businesses work together to address the challenges, respondents said the pandemic and consequent economic downturn also led to disadvantageous commercial behaviours such as cancelled or modified contracts.
OGUK Supply chain and Operations Director, Katy Heidenreich, says, ‘OGUK has been encouraging the industry to do business in a sustainable way to protect the supply chain. This includes finding innovative ways of working that deliver value for both sides, ensuring that industry has the skills and resources needed when activity rebounds, as well as using the Supply Chain Principles as a mechanism to improve behaviours.
‘Greater collaboration will be a key factor in unlocking future industry developments and to strengthening our basin, our versatility, and our resilience. The ability to work together well across companies, industry and the wider energy sector will be critical to delivering a successful energy transition which supports jobs and the communities we work in. Collaboration needs to be part of our DNA; while it is not a silver bullet, it is good for business.’
