UK's Oil & Gas Authority embarks on supply chain improvement initiative

The UK's Oil and Gas Authority (OGA) has introduced new measures to ensure operators work appropriately with the supply chain and "derive maximum value from project activity".

Supply Chain Action Plans (SCAPs) will be initiated, meaning operators will be required to develop effective action plans for all new projects including decommissioning activities.

The OGA has released new guidance, entitled ‘Supply Chain Action Plan Guidance’, to help operators to structure and submit their plans.

The purpose of SCAPs is to assist operators in demonstrating their contract strategies and concepts are comprehensive and well-positioned to deliver ‘best value’ in accordance with their Field Development Plan (FDP) or Decommissioning Programme (DP).

The concept of SCAPs was established some years ago in other sectors and proved successful in driving enhanced value and collaborative behaviours into new projects.

In a release, the OGA said revitalising exploration and maximising economy recovery of the UKCS is dependent on having a competitive and competent supply chain, which can operate efficiently and innovatively to deliver the services and technologies required to unlock the full potential of the basin.

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Bill Cattanach, Head of Supply Chain at the OGA said: “Supply Chain Action Plans provide a golden opportunity to drive behavioural change and promote a culture of active engagement between operators and the service sector, where it is accepted many of the solutions to enable MER UK exist.”

The SCAPs have been structured for the offshore environment and the process has been piloted by three companies, based on real projects. The pilots highlighted that early collaboration with the supply chain can significantly reduce costs through process efficiencies, reduced administration and by utilising alternative methods.

The OGA will welcome SCAP submissions from January 2018 and expects that they will be included in all FDPs and DPs from 1 April 2018. At the end of the first year, feedback will be sought from industry and the process refined as necessary.

Workshops are being held in early 2018 to ensure a wide understanding of the structure and expectations for these plans.