Benchmarking: Does Your Project Measures Up?

By: Tariq Siddiqui

Mega industrial projects (> $1.0 Billion) are serious undertaking. Only 20 % of E&P mega project succeed as compared to 50% other industrial mega project.  Will your project be successful or a Failure?? I strongly suggest you read ‘Industrial Mega Projects’by Edward Merrow. According to Ed, ‘In 300 global megaprojects, 65% failed to meet the business objectives and most of them were unprofitable. 

Here we will look at how Front-End Loading(FEL) and project measureshelp benchmarkUpstream capital projects and improve their profitability.

Must Know: Downturn Portfolio Strategies

By: Tariq Siddiqui

Recession and business downturns, can cause major financial distress to the companies. The companies that come out least scathed during downturn are the ones that are agile, swift to respond and have the most flexible portfolios. 

Here we will look at portfolio strategies that helped upstream oil & gas companies in recent downturn

Capital Project Management in Oil & Gas:

By: Tariq K. Siddiqui
A 3-Minute Summary of how capital projects are managed, from Identification of opportunity to Development and production

Pakistan Energy Security - Strategic Imperative

By: Tariq Siddiqui

Summary (please watch the whole video)

Energy challenge is one of the most important security paradigms in the Asia-Pacific region due to growing energy dependency, fueled by high economic growth. Pakistan population is expected to grow, It will become 20th largest economy by 2030 and 16 by 2050, based on existing GDP growth of +5.0 %. Pakistan GDP has potential to grow in double digits (see video), the only limiting factor is the supply-side bottleneck and poor governance. For Pakistan, assuring sufficient oil supplies, is a national imperative and crucial to Islamabad’s vision of energy security – guaranteeing that shortage of energy does not constrain the economic growth that is required to reduce poverty and tamp down the social and political turbulence that could be exploited by external interests

Pakistan needs rapid transformation to integrate with the world economy. To compete in the international markets, it will have to benchmark against world economies. The state-owned National Oil Companies (NOC’s) need to be privatized and made competitive; meeting the listing requirement for an IPO on international stock-exchanges. OGDC and other NOC’s needs to fulfill this role and become International National Oil Companies (or INOC's).

Decommissioning & Restoration in Oil/Gas Industry

Challenges in Next Five Years. (2018 - 2022)
By Tariq Siddiqui - Jan 6, 2018

Oil and gas Industry is facing tsunami of Decommissioning & Restoration D&R. According to Wood Mackenzie, US$32 billions in D&R spend is expected in next 5 years. The top 10 companies (Incl. Shell, XOM and Total) will spend 50% of this. The mature region facing D&R are UKCS, GOM and Malaysia. It is still an emerging industry, with lots of opportunity for supply chain industry, but the oil price collapse, has hurt the industry

So, what are the challenges in costs, strategies, regulations and funding? D&R cost involves; cost after ceasing production, platform & pipeline removal, wells P&A etc. There is a lack of D&R data and experience in forecasting costs, but it could be reduced through; lessons learned from previous D&R, new technologies, especially cluster D&R in UK or divesting the asset altogether or asset swaps

GOM has most experience with 55 D&R fields. The D&R strategies are; rig-to-reef scheme, some require complete dismantling others in East-Africa you can walk away without consequences so far. Regulations will have huge impact on cost. Some regulatory issues are scope of D&R;

 tax relief if any, liabilities/ownership issues. The supply chain industry has lot of opportunities, but there are still some major challenges ahead that need tackling.