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Improving Supply Chain Performance for an Offshore Super Major Oil & Gas Company

Client Background & Challenges

A large Oil & Gas company was looking to find ways to optimize its logistics OpEx spend and to improve internal customer satisfaction with service logistics (e.g. not receiving goods in a timely manner, poor visibility into supply chain leading to ineffective planning of resources and activities).

Excessive inventory led to poor logistics performance. The company had surplus vessels due to port turn around cycle time – on average 6.5 days/vessel. Excess slip capacity was only 50% utilized, and poor terminal layout and material flow resulted in using 15% greater footprint than required. In addition, personnel functionally was siloed and could not see the broader improvement opportunities.

Approach & Analysis

SSA & Company led a Lean Value Stream approach to identify strategic improvement opportunities, and embedded itself as logistics team members to gain trust and fully understand the company’s challenges. SSA facilitated the development of the end-to-end upstream and downstream processes defining interface opportunities. Simultaneously, SSA partnered in the redesign and reorganization of the logistics team required to support and proactively manage the new operating model.

Results & Value to Client

SSA’s three-year engagement reduced the number of vessels by 54%, decreased vessel turnaround time by 57%, minimized HSSE exposure hours by 19%, brought down third party operating costs by 7%, and increased production by 20%. The engagement delivered increased marine utilization, road transport optimization, and terminal efficiencies that resulted in a $500 million OpEx reduction, a 50% reduction from the start of the engagement.

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