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We operate two shipyards in the Canary Islands. Supportin contractors for their SPS, rig reactivation, maintenance, rep upgrade projects as well as MPD readiness and 2nd BOP D Reinforcement in the Canary Islands. We support local wo knowledge and skills development to meet our global clie
OUR 16,000 yard FACILITIES • Subsea & heavy Mechanical workshop with 126 tons overhead Gantry Crane • Mechanical and Hydraulic workshop
• Blast & paint shop • 500 mtrs quay side wi water depth 19mtrs
Our Capabilities • Rig repair and upgrade, SPS projects. • MPD Readiness and 2nd BOP Deck Reinforcement
• Re-engineering and stru analysis with ANSYS
Ontime safely Delivered projects within fixed price co Our facilities and capabilities at Las Palmas are also s
ESTABLISHED IN GABON SINCE 1993
PORT-G A member of contact
HOUSTO operatio
PORT-GENTIL OFFICE CERTIFIED ISO 9
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Mobile assets: Vantage Drilling’s mature supply chain WRITTEN BY
JOHN O’HANLON PRODUCED BY
DENITRA PRICE
03
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VA N TA G E D R I L L I N G
Maturing Vantage Drilling’s supply chain function over the last six years, with full buy-in from senior management, has seen the department morph from support to partner, says Director of Supply Chain Andy Poosuthasee
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ased in Houston, Texas, Vantage Drilling is one of the most effective players in that specialized niche of the oil & gas busi-
ness: offshore drilling. Offshore operations are generally not as easy as onshore or littoral operations – major, national and independent oil and natural gas companies require a dependable partner to carry this out. Vantage has five ultra-premium jackup rigs capable of operating in up to 375ft of water and drilling to depths of 30,000ft. It also has three ultra-deep-water dynamically positioned drillships designed to operate in water depths down to 12,000ft and drill to 40,000ft. It’s no secret that the entire oil & gas sector is on a slow climb back from its boom days. According to the industry analyst Rystad, offshore drilling in particular may not fully recover till 2027. This has affected drilling contractors like Vantage in a number of ways, says its Director of Supply Chain Andy Poosuthasee. The most notable of these is
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Photos Š Greg Williams
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VA N TA G E D R I L L I N G
“ We won’t sacrifice quality or compliance in order to get something quicker” 06
— Andy Poosuthasee, Director of Supply Chain
that where the norm used to be longer term, multi-year contracts, these days contract terms are often counted in months. This in turn means that the company’s assets have to be moved much more frequently than before. From a supply chain point of view frequent movements call for a greater degree of maturity, says Poosuthasee. “Probably the major challenge we face currently is that our rigs don’t tend to spend a lot of time in one particular country – we’re jumping around to different locations,” he explains. With seven of its eight rigs under contract Vantage is doing a lot better than its peers – the industry average is around 61% utilization, and there’s no lack of rigs waiting to come out of shipyards to further dilute that percentage. Still, the brevity of contract duration that is the price for high utilization is a supply chain challenge. “Even if we are working in the same country, the agreements these operators have with us and with the country itself are different. Looking ahead, I think we will be seeing more rather than fewer movements and that means that we have to be very nimble from a supply chain perspective.”
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KEEPING IT CLEAN
West Africa, customs procedures are
A fact of life for Vantage is that much of
more complicated, fickle and constant-
its business is conducted in countries
ly changing. In addition, countries that
that occupy the bottom 30 percentile
are highly dependent on oil are even
of the Corruption Perceptions Index.
more so severely affected in the
“This brings in a whole new level of
downturn, which has a knock-on effect
compliance and complexity into the
of potential added corruption. That has
supply chain organization where we
affected our supply chain strategy
must absolutely comply with transpar-
tremendously. We will obviously
ency and anti-bribery legislation such
comply with the anti-corruption laws
as FCPA (US). If you are working in
and have no tolerance for any devia-
places like the Gulf of Mexico or
tion. Recognizing that import clearance
Canada it is simple enough to organize
times may be measured in months
a compliant and predictable supply
rather than days, a rethink of strategic
chain, but in other locations such as in
sourcing and inventory management w w w.va nt a ge dri l l in g . com
VA N TA G E D R I L L I N G
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strategies is called for,� he adds. Poosuthasee is not daunted by such
forced offshore drilling contractors to find ways to be more effective, espe-
difficulties though. As a certified lean
cially within their supply chain. Conse-
sensei from his earlier experience with
quently, supply chain has become
the oil & gas services company
more important than it used to be in the
Halliburton, he looks on both the
past. I believe most companies
general downturn, and the rise in
(especially large ones) don’t take the
corruption that in part comes out of
total cost of ownership into account
that, as opportunities for refining best
because it is difficult to calculate
practices. “In the good times, compa-
especially when they may be working
nies tend to stagnate and the focus
in silos. For example, strategic
was more topline driven for offshore
procurement may be negotiating
drillers. I actually think the downturn
global/regional fixed price agreements,
has been a good thing because it
but not considering the import duties
(which in some countries can be up to
We have seen tremendous benefits
30% of the purchase value), customs
from that exercise.” These benefits
clearance times, freight, and inventory
include a significant reduction in lead
impact because that’s managed by
times, eliminating exposure to import
other departments within supply chain.”
duties (which can be as much as 30%) and customs fines, and enabling leaner
PARTNERING WITH OPERATIONS
inventories. In just three years, he adds,
When moving into a new country, the
Vantage’s local content in all categories
first task is for the procurement and
went from 33.2% to 56.7%, while in the
logistics team to go in, find local
same period lead times were cut by
suppliers and set up a local supply
nearly 40%. Another benefit of local
chain. “In challenging countries, where
sourcing is that it grows the local
it is very difficult to import, our strategy
economy, coupled with the fact that
is to source as much as possible locally.
many countries require foreign 09
E XE CU T I VE PRO FI LE
Andy Poosuthasee Andy Poosuthasee is Director of Supply Chain at Vantage, as well as looking after Engineering, Maintenance and Technical Support. Reporting to the COO, Poosuthasee is responsible for a key part of the company’s strategy. He joined Vantage in 2013, having previously worked at Transocean where he was also a supply chain manager. Prior to this, Poosuthasee was at Halliburton, one of the world’s largest suppliers of products and services for the energy sector.
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operators to maximize local sourcing. Any supply chain organization adds
importation delays or potential ‘penalties’ and ‘fines’. Countries that
value to operations through quality
are heavily dependent on oil and gas
delivery and pricing – in that order of
especially are constantly changing
importance, Poosuthasee believes.
their import/export requirements.
“We won’t sacrifice quality or compli-
Therefore, the potential for significant
ance in order to get something quicker
fines or penalties by local customs is
and we won’t sacrifice meeting our
there if you are not diligent and
internal customer’s operations delivery
focused on trade compliance. Of
requirements just because it’s going to
course among local suppliers, there is
save us some money,” he says. “One of
also a level of corruption so you must
the biggest benefits we see is that
spend a lot of time auditing them and
when you source locally you don’t have
doing due diligence to ensure compli-
to deal with trade compliance issues,
ance with the FCPA.” w w w.va nt a ge dri l l in g . com
VA N TA G E D R I L L I N G
Vantage now has a mature process for moving into a new market. Its Rig Move Checklist covers 30 logistics actions and 29 supply chain and procurement actions that are done before the rig moves to its new location. “We are very confident with the process because we have successfully used it so many times before,” he asserts. “I think taking the time to complete these 59 actions in advance is one reason we’ve had such success as we go into new countries. Of course, close liaison with the operations team 12
is very important: they are our customer so we spend a lot of time communicating with them to ensure we cover all of their needs prior to the rig’s arrival.”
TECH TOOLS FOR THE TIMES The priority for Vantage has been to identify cost effective rather than big ticket solutions to deliver automation, data management and reporting in the areas of procurement and inventory management as well as other parts of the business, such as maintenance and engineering. This is no time for heavy investment in this industry, and Vantage’s supply chain team discovered inexpensive, cloud-based
solutions at a fraction of the price of managed software to be the answer. One implemented cloud-based solution has proven to be a collaborative and work management platform with a relatively straightforward user interface. “It is a tremendous tool that has allowed us to eliminate many of our manual processes. The downturn has meant doing the same job with fewer people but we have not seen a degradation in the service that we provide. That’s because we have been able to automate many of our manual processes through the use of simple and really economical applications.” As a lean six sigma practitioner, Poosuthasee asserts: “One of the hardest things to do is to eliminate a piece of paper from the process.” Even so, a lot of paper processes have been automated by transferring them to this intuitive cloud based system. It’s clear though that he sets more store by the attitudes and commitment people bring to their task than the methodology. “I’ve learnt a lot from mistakes I have made in the past. One of the biggest ones was chasing too many initiatives, too many strategic goals. Now I tell my team to focus on what w w w.va nt a ge dri l l in g . com
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VA N TA G E D R I L L I N G
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“ We have to be very nimble from a supply chain perspective” — Andy Poosuthasee, Director of Supply Chain
Franklin Covey calls the wildly important goals; focus on less so that your team can achieve more.” In furtherance of this principle, which Poosuthasee also characterizes as going “an inch wide but a mile deep”, the supply chain team is focusing this year on trade compliance, both to minimize the risks thrown up by different customs regimes and to further automate procurement systems and processes. w w w.va nt a ge dri l l in g . com
VA N TA G E D R I L L I N G
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A PARTNER IN THE ENTERPRISE When Poosuthasee joined Vantage in 2013, the company was still in “start-up” mode, and supply chain was doing a good job, but more as a support function. Since joining, he has worked to build the organization in three phases. The first phase was to strengthen the foundations and streamline the processes to be as effective as possible; the second was to start demonstrating and adding value to the company. “I wanted to show that we could actively impact KPIs and other value-added activities such as on-time delivery, quality, local sourcing, negotiations and inventory management. Show the company we can do more than just transactional tasks such as issuing POs.” Phase three was to become a true partner in the business, being asked to support non-traditional supply chain tasks such as sourcing service personnel and labor, real estate, catering, auditing, compliance, and even marketing right from the bidding stage. “It was truly pleasing from my viewpoint to see us moving from being a support team to being asked for advice on things we w w w.va nt a ge dri l l in g . com
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VA N TA G E D R I L L I N G
OIL & GAS DIVISION We operate two shipyards in the Canary Islands. Supporting drilling contractors for their SPS, rig reactivation, maintenance, repair and upgrade projects as well as MPD readiness and 2nd BOP Deck Reinforcement in the Canary Islands. We support local workforce knowledge and skills development to meet our global clients
OUR 16,000 yard FACILITIES • Subsea & heavy Mechanical workshop with 126 tons overhead Gantry Crane • Mechanical and Hydraulic workshop
• Blast & paint shop • 500 mtrs quay side with water depth 19mtrs
Our Capabilities • Rig repair and upgrade, SPS projects. • MPD Readiness and 2nd BOP Deck Reinforcement
• Re-engineering and structural analysis with ANSYS
Ontime safely Delivered projects within fixed price contracts Our facilities and capabilities at Las Palmas are also similar
A member of
www.tenerifeshipyards.com www.hidramar.com
VISIT OUR SITE
+34 922 104 982 gara.socas@hidramar.com commercial@tenerifeshipyards.com
CONTACT US
“ We have been able to automate many of our manual processes through the use of simple and really economical applications” — Andy Poosuthasee, Director of Supply Chain
weren’t involved with in the past and becoming a true partner in the organization.” Andy Poosuthasee and his supply chain team are certainly finding ways to add value. Even some relatively mature locations have seen some dramatic results. For example, trade compliance turned out to be a big issue in Indonesia where even airfreight imports were taking a fortnight to clear. By developing local suppliers Vantage went from sourcing 47% to 81% locally. A different challenge faced the company in Qatar following the imposition of sanctions by GCC countries from which most supplies had previously been sourced. In just a couple of years, local suppliers have been brought on, at first being given short contracts but more recently these have been extended and today, he says, it is one of the easiest locations, with more than 80% locally sourced.
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Vantage Drilling 777 Post Oak Blvd, Suite 800 Houston, Texas 77056 USA T +1 281 404 4700 www.vantagedrilling.com