NEED FOR CHANGE
Reflecting on 2013 cannot avoid a clear recognition that cost trends for the industry in general and on the NCS in particular have been so strong that they now not only present an obstacle to recovering the last drops from mature or marginal fields, but also actually pose a threat to the development of new discoveries which we had previously regarded as solidly commercial. Oil companies, suppliers and the government need to accept responsibility here for turning every stone to pursue simplifications, efficiency improvements and cheaper solutions without increasing risk.
Our industry has made a substantial contribution itself to the cost increases. I believe more extensive processes and requirements have crept up on us, almost imperceptibly. New elements are introduced without been assessed for their impact on costs. We end up with a kind of “compound interest” effect, which results overall in large cost increases. The industry must accept responsibility for reversing this trend.
It will not be easy, because we are talking here about challenging our own modes of action, which have been allowed to develop over a long time. We need to simplify formal procedures as well as practical ways of doing things. And we need to make a bigger effort to standardise where we currently use tailormade solutions.
Many of the challenges facing the industry must be met with good change management and a solid portion of stamina. Above all, I believe that players on the NCS must collaborate. That is done best, in my view, by starting with ourselves and then participating in a respectful and open manner in the interaction needed to find good solutions.