Ensuring the Security of Supply of Equipment, Materials and Local Content
- James Arnott (Accenture)
- Document ID
- World Petroleum Congress
- 21st World Petroleum Congress, 15-19 June, Moscow, Russia
- Publication Date
- Document Type
- Conference Paper
- 2014. World Petroleum Council
- Local Suppliers, Emerging Markets, Indigenous Workforce, Local Content, National Oil Companies (NOCs), Local Workforce, Economic Benefit, Supply Chain Integration, Government Relations, Local Supply, Supply Chain, In-country Value, Nationalism, International Oil Companies (IOCs)
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- 44 since 2007
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Across the world the “new resource” owners are looking for significant investments from joint venture partners in the broader development of their economies. The expectation is evident in the following examples:
Brazil – “Contractual commitment of purchasing local goods and services on a competitive basis with the objective of developing local suppliers and technology and increasing employment and income growth.”
Nigeria – “ Nigerian content means the quantum of composite value added to or created in the Nigerian economy by a systematic development of capacity and capabilities through the deliberate utilization of Nigerian human, material resources and services in the Nigerian oil and gas industry.”
Saudi Arabia – LC is defined as the value added or created in the Saudi economy through the utilization of in- Kingdom human and material resources in the provision of goods and/or services.
In bidding for and executing the capital project joint venture partners’ seek to fulfil local content expectations through a variety of opportunities. These include the use of local workforce, local suppliers for goods and services, and investments into the social infrastructure e.g. schools, roads, hospitals, railways etc.
Based on Accenture’s capital project research, experiences and roles in supporting clients in the execution of capital projects, Accenture has developed a Local Content framework which spans strategy definition to implementation. Using this framework Accenture will share with the audience its perspectives on the maturity of local content capability, the value orientation of local content programs and the performance of contractors in meeting local content expectations and hence securing the supply of equipment, materials and local content infrastructure. Accenture will be able to draw examples from the Middle East, Nigeria, Canada, Australia, Brazil and South Africa.
This paper is aimed at oil and gas senior executives that are responsible for the defining, implementing and monitoring local content strategies.
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