December 15, 2020
Our energy hubs around the world support global offshore and onshore exploration as well as ongoing MRO requirements for the global industry and across all segments.
Global supply and resupply are critical functions that we fulfill on behalf of our clients. Integrating further into the industry, we also heavily support the deployment of assets/capital equipment. Our specialist rig move approach ensures efficient mobilization and demobilization to the field with two key priorities: operational efficiency and project cost alignment.
In key offshore markets, Crane Worldwide provides vessel and agency management services to ensure smooth offshore transitions. In line with our commitment to provide the right services in the right locations, Crane Worldwide is directly present not only where global supply clusters are situated, but also in key operational geographies such as Guyana. Crane Worldwide works across the entire value chain of the industry.
We support the upstream, midstream, and downstream sectors. This includes daily operational requirements as well as capital project management and execution.
George Schutte, Vice President Energy Solutions provides his outlook on 2021 and beyond.
My view is that overall investment in the field will continue with a flat to downward trend throughout 2021. Primarily, if we are still in lockdowns and a tampered economic environment, big capital decisions and expenditures will be reserved at best.
However, as we emerge from this acute phase of trying to manage the pandemic and turn to recovery, there is still ample room for investment and growth. Even as supply/demand met its equilibrium a few months ago, the improvement is still slow and the world sits on a more than ample supply.
At the tail end of 2021 and into 2022, we would expect a boost in energy activity. There is no indication of an all-out boom, but somewhat a return to normal in terms of capacity and in terms of the deep pocket majors securing long term reserves and development.
For the forwarder, it will be necessary to adjust to these new economic patterns and take a staunch view of controlling not only our own costs but how that reflects in a global pricing strategy. Where the “work” is assuredly slower for the near to midterm, an opportunity for new services and outsourcing structures abound. As such, the more agile and financially efficient forwarder will have the opportunity to extract value from its participation in the energy sector.
The oil industry, in particular the capital drivers – oil companies, are a long-term view industry. Where significant losses and write-downs have occurred throughout 2020, those losses are also improving and leaving oil companies in a stronger financial position to drive further capital investment in the future.
In addition to oil and gas, our energy portfolio supports the marine, mining, and alternative energy sectors. A leading focus on technology ensures clear and global visibility of pipeline materials all the way to the site. Crane Worldwide is a keen outsourcing partner with a presence and competence that ensures global to local operational excellence.
The three most impactful trends are the outsourcing approach, waste elimination, and the potential for industry consolidation. All these aspects would have a significant impact and taken is where the required industry reconfiguration comes into play. The impact on the logistics industry will (is) also significant. On the opportunity side, outsourcing creates the possibility for new solutions and for the forwarder to capitalize on logistics functions that in the past were managed by the industry themselves.
There is an opportunity in providing greater visibility and in systematic reliability in supporting mush required elimination of waste by the system. That logistics efficiency can reach all the way back to procurement efficiency. The industry should be prepared to support a more agile approach to affecting the supply chain. There are cost and cash implications to which the industry is receptive. We should focus on being consistently reliable and utilizing visibility tools. Industry consolidation creates the opportunity to concentrate competence and for those strong energy forwarders, provides an opportunity to achieve growth in a depressed marketplace.
There are of course risks for the industry as well as the forwarder. Consolidation will risk the business of key players, particularly for those in a niche environment, as volumes are concentrated to a select few. There is a likely effect on the industry on pure logistics costs, however realizing enterprise-wide efficiencies far outweighs the potential impact of increased transportation costs.
The most important aspect in all of this is where the industry demands cost and efficiency correction, there is no acceptance of a reduction in service levels or safety principles. We should continually improve operating protocols and capabilities to keep up with industry demands. Wholly safe operational execution is standard to be in the market. Cost decisions or sacrifices should/will not be a driver in sacrificing safety or operational excellence.