Oil and Gas Equipment and Services Industry case analysis

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Oil and Gas Equipment and Services Industry case analysis

Introduction

The sector of oil, gas equipment, and service industry comprise primarily in extracting natural minerals. These naturally occurring minerals can be found in the form of solids such as coal or ores, liquids such as crude petroleum and natural gas. The oil and gas extraction is a sub sector that is mainly engaged in operating oil and gas field properties. These activities include exploration of crude petroleum and natural gas like drilling, completing oil wells, equipping the oil wells as well as, operating separators like as emulsion breakers, desilting equipment and field gathering for crude petroleum, and all such activities involved in preparing oil and gas till the point of shipment.

According to Oxfam America, (2009) this subsector is concerned with the production of oil, the hydrocarbons and gas, through gasification, liquefaction, and pyrolysis. This is done at the mine site. Oilfield Services include manufacture, repair and maintain all types of equipment used in oil extraction and their transport. These services may include Seismic Testing, Transport Services and Directional Services for drilling the angled and horizontal holes. On the other hand, drilling services includes drilling oil rigs such as Land Rigs, Submersible Rigs, Jack-ups and Drill Ships.

Marketing Analysis

An analysis of business industry in the oil and gas sub sector must take the following factors into consideration:

The geographic area must be specified whether it is local, regional, state wide, national, and international.

The size.

Trends,

outlook of the industry.

The product which is oil and natural gas.

The regulatory environment.

Company information for identifying and researching the most successful businesses.

The oil and gas equipment and services industry

Oil and gas energy in Canada is an international business, with Canada being the sixth largest supplier in the competitive world market for oil and gas equipment and services. The Canadian industry is recognized worldwide for its contributions in oil and natural gas exploration and production through the use of technologically advanced equipments. Canadian suppliers of equipment and services offer globally competitive drilling technology, communications equipments, diving services, environmental services, seismic data analysis, supply vessels, offshore engineering and project management, and fabrication of offshore and marine equipment such as topside modules, rig platforms, well heads and valves (Prempeh, 2008).

International customers are aware of the vast abilities of Canadian companies, and expertise from domestic and international business. Canadian companies serve the large demanding domestic market. The industry identification is oil and gas extraction (NAICS 211). The leading businesses in this subsector are Gas Inc, Anderson Energy Limited, Compton Petroleum Corporation, Transglobe Energy Corporation, Lions Petroleum Inc, Canadian Natural Resources Limited, Bakken, Birhcliff Energy Limited, amongst others.

Problem Definition

ConocoPhillips Canada (CPC) is oil and Natural Gas Company is in the exploration, development, and the actual production of oil and natural gas. It is privately owned, and also extracts bitumen and operates in forty countries. The exploration acreage is in Atlantic Canada it extracts bitumen from oil sands. The company’s profile on demand service covers around 50000 of the world’s leading companies, and wishes to improve the product range and expand to more regions that it has never ventured (Adidjaja, 2007).

SWOT Analysis a case study of UK Company

The SWOT analysis gives the market profile of a company and considers both internal and external factors affecting the business.

Strengths

The company’s strengths are the international presence, so it is able serve customers irrespective of the geographical boundaries and locations. The company has immense capabilities in terms of equipments and personnel. The product range is exceptionally wide for optimal business, together with diverse operations. The company is able to access all the resources it needs for its production since it is able to explore its own crude oil, refine it, and get the final products. It is located in Canada covering a wide geographic region of the country, although, the company’s headquarter is in USA. Business and net income come from exploring new oil fields, oil mining, and production of oil (Prempeh, 2008).

The weaknesses

The weaknesses of the company are the leadership. Since it is a privately owned company, it does not have access to government support such as tax concessions, or benefits of trade liberalization. The processes and systems are not able to diversify to other products and services produced by other oil and natural gas companies are able to produce. The company was disallowed tax deductions for a payment concerning an oil tanker, and was assessed to offset the costs associated with the said transfer.

The opportunities

According to Adidjaja et al, (2007) the opportunities are many that the company can leverage so as to achieve its bottom lines. The company is highly at an advantage to respond to environmental changes, market changes as well technological changes. Given the type of market it operates in, it is positioned to respond to the market turbulence associated with the oil industry. The company is a leader in innovation, therefore, has the capacity to develop technologies and systems that are environmentally friendly. The North Cook inlet field produced 1.8 trillion cubic feet of gas, thus offsetting the earlier leases on the western frontier. With experience of operating in forty countries, the company has the ability to explore new markets, and develop new marketing tactics and new product innovations. ConocoPhillips is a company that does not operate solely; it can easily enter into a merger and or a partnership with likeminded companies. Therefore, the company has considerable potential for future growth and developing more products ranges (Beimborn, 2008).

Threats

Some of the threats the company faces is the intense competition from the many companies that operate within Canada, and other regions that produce crude oil in the world. The owners of the company come from the United States of America, yet they are located in Canada which introduces different trade operating environments and political attitudes. There are many competitors in this market which may prove as a threat to the interests and growth of the company. Pertaining to the Texas royalty properties were transferred from STC to Riverhill energy. The company only remained with the field, technical, and accounting operations. Environmental concern is an immense headache for many oil companies. With the world going green, environmental conservation is a priority, and its ability to produce environmentally safe products is yet to be compared to other competing companies (Gilbert, 2009).

Criteria

The strategic marketing plan for ConocoPhillips is to improve the quality of its products to be environmentally safe, and expand its operations in regions or countries that it has never ventured.

Environmentally Safe Products

Implementing the environmentally safe products is at the heart of the ConocoPhillips Oil Company. The first implementation stage of this project will be done by green conscious scientist, some of them are already employees, and any extra expertise required will be outsourced. The environmentally safe products will be produced within the company’s plants in Canada, since the company is a leader in chemical processes innovation, the company expects to consume three months in the whole process. The environmentally safe products should be ready in the market one month after the development.

Conclusion

Oil and gas equipment and services industry is a multi trillion dollar business that is expected to continue growing, and gaining more revenue. This is because many nations in the developing world still depend on oil and gas for their energy needs. Canada is a table country politically and economically, with vast oil reserves in the offshore fields. Therefore, much development is expected technologically, and the development of green chemistry, that will lead consumers to a safe environmental safe energy sources.

References

Adidjaja W. Selene I. Jessica L &, Morhardt E, (2007). Pacific Sustainability Index Scores 2007 Gilbert R (2009). Oilsands development, Major layoffs expected after Alberta projects put on hold. J. Commerce.

Beimborn E (2008). Transportation Energy: Supply, Demand and the Future, Centre for Urban Transportation Studies University of Wisconsin-Milwaukee Presentation to the District IV Conference Institute of Transportation Engineers.

Oxfam America (2009). Oil ‘hot spot’ Ghana must proceed with caution. Oxfamamerica news and publications press releases

Prempeh A (2008). The oil finds in Ghana. Alexander gas and oil connections. Company News: Africa.