Description of the Material
There have been growing concerns among stakeholders and policy makers on the need to increase local content capacity and participation in the oil and gas industry.
As new markets develop and host countries develop local content policies and performance expectations, the oil and gas development companies face increasing complexities in supply chain integration of local content. In many instances, performance assurance with local content performance expectations is becoming a threshold for obtaining and/or maintaining a company's social license to operate.
This paper chronicles one company's approach to leverage local content as part of their supply chain management strategy to grow capacity while managing and fulfilling stakeholder expectations. It documents how one upstream organization integrated use of local content into their own methodology for HSE & SR performance by evaluating the strategy, training, processes, and management systems employed within their own organization and deploying to their supply chain.
The findings will show how any oil and gas organization - by evaluating the execution of their local content / supply chain strategy – can improve performance of there development projects through local content capacity building of suppliers.
The Results, Observations and Conclusions
The paper will detail the existing performance of the organization and how they developed a 90 day - 5 year plan for improving their own HSE & SR performance as well as the performance of their suppliers. It will evaluate the strategy employed by the organization, the processes, the management systems and tools as well as the training and human capabilities.
Significance of the Subject Matter
Building local capacity positions a company to leverage knowledge, skill and capacity of local markets. Performance equates to risk mitigation (reputational risk; safety incident avoidance through engagement of local skilled worker; lower cost of capital) to business model innovation (operations efficiency; lower lifting cost, faster time to market).