THE OIL AND GAS SECTOR IS ONE OF THE LARGEST IN THE WORLD IN TERMS OF DOLLAR VALUE, HOWEVER, IT IS ALSO ONE OF THE MOST EXPOSED TO GLOBAL CHALLENGES MAINLY DRIVEN BY COMPLEX SUPPLY CHAINS, POLITICAL INSTABILITY OF MANY PRODUCING COUNTRIES, CONTINUOUS PRICE VOLATILITY, TRADE WARS AND THE RISE OF SUSTAINABLE ENERGY: LEAN PROVIDES A COMPETITIVE ADVANTAGE BY STREAMLINING AND STRENGHTHENING ALL PROCESSES AND HENCE MAKING THEM MORE RESILIENT
The complex oil and gas supply chain can be broken down into three key areas: upstream (exploration & production), midstream (transportation, storage, and processing of oil and gas) and downstream (filtering and refining raw materials into derivate products that can be sold to consumers). The 3 areas come with specific challenges, however, they share the requirement to increase productivity while minimizing costs, in order to drive competitiveness
The increase in competitiveness is achieved by continuously improving processes across the supply chain, from the upstream exploration and production processes all the way through the midstream transportation and the downstream refining of products. Continuous improvement initiatives should begin with the identification of major areas of improvement, in order to derive a structured implementation plan prioritizing high return projects that can be implemented easily
The application of Lean in the oil and gas industry eliminates wasted time and resources thus, increasing the efficiency of the people, equipment and processes involved. This results in achieving minimal waste, more satisfied customers and higher quality output at a lower cost, which in turn results in increased profits. The benefits of Lean in oil and gas are significant and go well beyond financial rewards.