|
BP Exploration (Alaska) affirms commitment to Alaska buy, build, hire Company will host half-day workshops covering a variety of topics in the purchasing and contract services arena. Subsequent workshops will be structured around input from attendees. Tom Hall PNA Contributing Writer
BP Exploration (Alaska) Inc. spent 83 percent of its 1998 operational and capital expenditures in Alaska with Alaska-based contractors.
“Our commitment to ‘Alaska buy, build and hire’ must continue to be a cornerstone for our development in our projects over the next 10 years, and you obviously have to play a major part in that,” BP Exploration (Alaska) Procurement Manager Mike Cortez told the Alaska Support Industry Alliance Oct. 1.
That was the first message that Cortez had for Alaska contractors and suppliers.
He also discussed future projects, but said the third message — and his real reason for being there — was to enhance supplier relationships with Alaska based businesses.
Alaska buy, build and hire To underscore BP Exploration (Alaska)’s commitment to Alaska buy, build and hire, Cortez said that of $953 million in the company’s 1998 operational and capital expenditures, 83 percent was spent in state with Alaska based contractors. He added that the remaining 17 percent was spent on specialty engineering equipment and items that are unavailable in Alaska because they are not manufactured or developed in Alaska.
“This 83 percent pretty much reflects our trend for the last four or five years. It’s been in the 80 to 85 percent range and Alaska buy, build and hire, as we continue to indicate, has always been a major cornerstone of our procurement policy, and it will continue to be so,” Cortez emphasized.
He pointed out that one of the key links to maintaining such a high Alaska buy, build and hire record is by using an organization like the Alaska Supply Chain Integrators LLC (see March 1999 PNA).
“ASCI conducts most of our transactional purchasing, and is our service provider for a lot of our purchasing in Alaska,” Cortez said.
ASCI uses BP Exploration (Alaska)’s list of preferred suppliers, which covers a host of market segments, and acquires goods from Alaska based operators to run the company’s operations on the North Slope and elsewhere in Alaska. Cortez explained that while ASCI provides the transactional purchasing with BP Exploration (Alaska)’s network suppliers, the company holds the contracts for everyone of the network suppliers.
“A lot of the companies that are on this list (network suppliers) are very, very knowledgeable of our operations up on the slope,” Cortez said. “They’re very, very competitive with prices in areas that we see elsewhere, and I think part of our success in being such a low cost operator is as a result of this good operation here with ASCI and our networked suppliers.”
Future opportunities Cortez said that once the BP Amoco and ARCO merger is complete and state and federal regulatory requirements are satisfied, there would be “...a whole host of future growth opportunities on the table for both BP and ARCO.”
He mentioned the continued development of two major projects, Northstar and Liberty, as well as several satellite accumulations like Sandpiper.
BP Exploration (Alaska) also intends to establish a $70 million gas-to-liquids pilot project and hopes to determine if the process has any commercial viability for developing the vast natural gas reserves on the North Slope.
The recently discovered Fiord field and exploration of the NPR-A lease holdings are going to provide “some excitement” over the next five to 15 years, Cortez said.
“The list goes on and on,” Cortez said, “and it’s this kind of excitement that I think is being generated between both our fine companies. We’re hoping to kind of envelop you in that excitement so that we can get out there and get some of those fields developed for the good of Alaska and for the good of the supplier community.”
And as an example of how BP Exploration (Alaska) emphasized their Alaska buy, build and hire policy, Cortez cited the Northstar project where 10 major suppliers and a “whole host” of other suppliers are providing goods and services to the project.
“One of the things you need to realize is that BP, as an operator — not only here in Alaska, but around the world — tends to outsource the majority of our (market) segments in procurement of purchasing and contract services,” Cortez explained. “And that should mean a good opportunity for you as a major supplier.”
That policy, he said, is what has enabled BP Amoco to run a lean and efficient operation so that the company can stay competitive with other major oil companies like Exxon.
“And,” he added, “we can’t do that without a lot of help from our supplier community.”
An invitation Cortez recognized that some contractors and suppliers may have had a less than satisfying relationship with BP, but he appealed to them as well as to those who have never done (or have done only limited) business with BP to contact his group.
He said that the past is the past and extended an offer to contractors and suppliers to communicate with him or anyone in his group.
“I’m going to try to appeal to a lot of you to contact our group to talk with us, to visit us; or to share with us some of the expertise and skills and products and services that you can provide to us,” said Cortez. “And we, in turn, are going to try to share with you some of our needs in these market segments as we move forward in developing some of these new projects in the new millennium.”
Cortez said that BP would host a half-day workshop on Oct. 25 in Anchorage and another in Fairbanks on Nov. 3. Cortez told PNA Oct. 7 that response to the workshop was so great that it has been moved to the Anchorage Hilton Hotel. Subsequent workshops are scheduled for the spring of 2000, although firm dates have not been established.
Cortez said that, initially, experts within BP will provide details on subjects in the purchasing and contract services arena. They will cover topics such as ASCI and how it works, how transactional purchasing works, how to get on the list of network suppliers, the bidding process, contracts terminology, and health, safety and environmental requirements.
Subsequent workshops will be structured around feedback from the attendees, Cortez said.
| 