UK Oil and Gas Industry Association : Sector Increases Take-Up of Shared Industry Tools to Improve Efficiency

A rising number of companies are using shared industry tools developed by Oil & Gas UK and its subsidiary, LOGIC (Leading Oil and Gas Industry Competitiveness), to simplify procedures and improve the efficiency of working and commercial practices on the UK Continental Shelf (UKCS).

More than 900 companies have signed up to the Industry Mutual Hold Harmless (IMHH) deed that LOGIC operates on behalf of the sector to address the contractual gap which traditionally existed between different contractors working offshore.

Ken Cruickshank, LOGIC's managing director, said: 'With the UK oil and gas sector seeking every opportunity to improve efficiency to maintain competitiveness, the IMHH provides a mechanism for small to medium-sized companies to achieve cost effective risk management by clarifying the allocation of liabilities and costs for key areas of risk covering personnel, property and consequential loss and preventing multiple insurance of identical risks.'

Demand for LOGIC's suite of ten Standard Contracts has also increased. More than 19,000 downloads have been recorded globally since April 2014, with both purchasers and suppliers benefitting from the contracts which outline general conditions to help participating parties reduce bidding costs, eliminate duplication of effort and increase the efficiency of business processes. In greatest demand is Edition 3 Services (On and off-shore) with more than 2,000 downloads. Newly available on the LOGIC website is the updated Standard Contract for Supply of Major Items of Plant and Equipment, covering the purchase of complex capital equipment including gas turbines, compressors and pumps.

Oil & Gas UK has now revised Standard Agreements for operators involved in the construction and operation of pipelines in the UKCS to address situations when their pipelines will either cross or run in close proximity to one another.

Mr Cruickshank added: 'Standard Agreements, updated to reflect new regulations and case law, provide all participating companies with terms and conditions to govern their arrangements, rather than developing their own individual contractual arrangements, while also ensuring their respective interests are cost effective and remain adequately protected.

'We welcome the news that a growing number of companies in the sector see the benefits delivered by shared industry tools including those developed by LOGIC, which will help boost the cost effectiveness of UKCS operations. These actions align with pan-industry efficiency initiatives to help improve the international competitiveness of the UKCS, the principles of the Supply Chain Code of Practice and Government policy to maximise economic recovery from the basin.'

For more information, please contact Lucy Gordon at [e-mail] or 01224 577331.

Editors' notes:

LOGIC

LOGIC was established as a not-for-profit organisation in 1999 (incorporating CRINE (Cost Reduction in the New Era)) and became a wholly-owned subsidiary of UKOOA, now Oil & Gas UK, in 2005. Since then, it has promoted and managed a suite of collaborative industry-wide tools aimed at reducing costs on the UKCS, including Vantage POB, Master Deed, IMHH, Flight Share, Helimet and Standard Contracts. To find out more about LOGIC's shared industry tools visit here.

OIL & GAS UK

Oil & Gas UK is the leading representative organisation for the UK offshore oil and gas industry. Its members, who number over 500, are companies licensed by the Government to explore for, and produce, oil and gas in UK waters and those in the industry's supply chain. Oil & Gas UK's pipeline crossing and pipeline proximity agreements are available here

The Supply Chain Code of Practice (SCCoP)

The PILOT Supply Chain Code of Practice (SCCoP) is a set of best practice guidelines which the UK oil and gas industry is encouraged to follow in order to help businesses improve overall performance, eliminate unnecessary costs and add value and boost competitiveness. More information is available here.