Price WaterhouseCoopers has called on independent oil and gas companies operating in Africa to adopt operational excellence if they are to overcome their teething hurdles and emerge as successful companies.
A statement on Wednesday quoted the Partner, Energy Blueprint at PwC, Ole Evensen, as saying indigenous oil companies must focus on operational excellence to close the gap between their ambitions and actual performance.
He said this at the first annual Africa Oil and Gas Conference held recently in Accra, Ghana.
He said, “Operational excellence is no longer something that indigenous oil and gas companies in this region strive for but a ‘must have.’
“Getting the very best out of operational activities has become vital for oil and gas companies. Reserves are becoming more inaccessible and expensive to get out of the ground; new technologies and engineering solutions need to be maximised; scarce talent has to go further; midstream and downstream activities need to gain margin; and above all, industry safety is critical.”
Africa Oil and Gas leader at PwC, Uyi Akpata, said, “The operational excellence model developed by PwC focuses on creating a blueprint for indigenous oil and gas companies that clarifies the organisational goals, using key performance indicators; improves the supply chain management; optimises asset management; and improves strategic competence and production efficiency.”
Some of the issues discussed at the two-day conference include local content initiatives, inadequate infrastructure, operational efficiency, capital, fiscal concerns and regulation.
The Executive Secretary, Nigerian Content Development and Monitoring Board, Mr. Ernest Nwapa, said that for Nigeria to be a great oil producing nation, it had to fully optimise the opportunities in the oil and gas value chain by increasing local participation.
He explained that the Nigerian Local Content Act was passed into law in order to encourage local participation in the oil and gas sector in the country.
According to him, the board has developed a model that allows the participation of independent oil companies in the creation of training opportunities that benefit local communities – building local capacity, asset ownership and ensuring a cut-down on abuse of expatriates.
In his keynote address, the Managing Director, Shell Petroleum Development Company Nigeria, Mr. Mutiu Sunmonu, called for a meaningful collaboration within and outside the region to fully unlock Africa’s oil potential.
He listed knowledge transfer, human capital development, investment and financing as some of the benefits that could come with such collaborations in the industry.
The Advisory and Strategy Leader, PwC West Africa, Mr. Andrew Nevin, in his presentation, urged Nigeria and other oil-rich countries of Africa to diversify their revenue points or prepare for the impending revenue decline as a result of the discovery of shale oil.
He noted that oil exports had been on the decline as a result of greater adoption of shale oil by oil-importing countries, notably the United States of America.
Information from Punch was used in this report.